Fox News "Fox News Sunday with Chris Wallace" - Transcript

Interview

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BAIER: Joining us now are the two Senate whips whose job it is to round up the votes of their respective parties: Senator Dick Durbin, a Democrat from Illinois, and Senator Jon Kyl, an Arizona Republican.

Welcome back to you both.

SEN. DICK DURBIN, D-ILL.: Thanks, Bret.

BAIER: Well, let's try to characterize at this point where this compromise is. Senator McConnell has just said he is very close.

As you see it, how do you characterize it? Senator Durbin?

DURBIN: I would tell you, I have a much more positive feeling than I did 24 hours ago. There is an active negotiation underway. I think some of the things that are coming forth hold promise. Key elements are still being resolved. I know Gene Sperling was in a painful position earlier on your show.

We want to move this forward. We want avert this economic disaster that would occur if we default on our national debt for the first time.

BAIER: Senator?

SEN. JON KYL, R-ARIZ.: I dis -- excuse me -- I agree with what Dick just said. Republicans have also been very focused on in ensuring that we do not get into a position where we can't pay our bills, where the things that American people rely on, will still get to them in time. And as result, the leaders in both parties were fixed on the August 2nd date. Too bad we had to this closed to it, but at least it focuses the mind to get them to really agree to what it will take to resolve the situation.

BAIER: So, Senator Durbin, just to dig down into this a little bit. Is it your understanding that the broad outline is pretty much locked in, and that there is some negotiation on the trigger -- this thing that the second stage of this funding would be tied to, the joint committee?

DURBIN: That has been the sticking for quite a few days now. Initially, it was whether or not we were going to do the debt ceiling in two phases. The president said, absolutely not. And our position was absolutely not.

And that's why the Boehner approach that was sent to the Senate was rejected by a bipartisan roll call, 59 to 41.

BAIER: Although this looks a little bit like Boehner with --

DURBIN: Key element: we're not returning to this before Christmas. We're going to do this in a way so that the economy is not in suspense and doubt about our future.

But in terms of where we're going, down payment, agreed -- that we're going to make some down payment on the deficit, a significant one. Secondly, the establishment of a joint committee to move forward, to find longer deficit reduction and the trigger, which is the enforcement mechanism for those who aren't it too closely. And that has really been the toughest part.

BAIER: So, if it doesn't include tax increases, revenue increases in that trigger, are you OK with that?

DURBIN: I think it's bad policy. I sat on the Bowles-Simpson commission, and with the "gang of six" -- and we came to the conclusion, if you are serious about real long-term deficit reduction, put everything -- underline everything -- on the table. Keeping revenues off the table, I think, is a serious mistake.

BAIER: And if it includes serious defense cuts in that trigger, are you OK with that?

KYL: That would be a real problem for Republicans.

But if I could back just a moment and set the stage for where we come, remember, three months ago, the president insisted on a clean debt ceiling extension. Clearly, we will have a significant amount of spending reductions in this proposal.

The second thing was he insisted on revenues, as he called them, tax increases. There will not be tax increases in this proposal. Third, both sides agreed that we needed to have mechanism for moving forward in the future so that we could look at both the entitlement side of the ledger, as well as the discretionary side of spending and make recommendations to the rest of Congress about how to provide some accountability for the future. That is embedded in what I understand would be the key part of this agreement.

So, Republican principles I think will be significantly advanced by this proposed agreement.

BAIER: Is there a balanced amendment vote?

KYL: I think it probably will involve the opportunity to include a balanced budget amendment. But it would not be an essential element in order to move the agreement forward.

BAIER: Senator Kyl, when you hear the president say this no way to run the government, you know, that we'll likely also face another standoff at the end of September when the continuing resolution runs out and government funding -- you know, we're up against another government shutdown. You know, former White House chief of staff, Rahm Emanuel, once famously said, "Never waste a crisis."

Do Republicans now risk become the -- becoming the party that's always pushing up to the cliff, always using that cliff to try to extract concessions? I mean, do you fear the American people will have crisis fatigue, if they don't already, and that it will hurt your party?

KYL: You mentioned the possibility of a continuing resolution. Why would Congress have to pass a continuing resolution? Because the Senate Democrats now, for the third year in a row, will not have passed a budget. That's their job.

The House Republicans have passed a budget. Senate Democrats said no to that budget. So I think it's very unfair to suggest that Republicans are responsible.

We don't have the votes in the U.S. Senate. But where they do have the votes, in the House of Representatives, they've done their job.

BAIER: Senator Durbin, why haven't the Senate Democrats passed a budget?

DURBIN: It's called 60 votes. And what it boils down to is this: we have 53 Democratic senators.

(CROSSTALK)

DURBIN: Well, but I can tell you, when we get through all the procedural tangles that we face in getting through this budget resolution, it is not just a matter of finding some agreement, but getting it executed on the floor.

The point I want to make is this: this, as I understand it, the negotiation that we're talking about, will include some budget targets for at least the next fiscal year. So we won't revisit this kind of crisis politics when it comes to our spending bills for next year.

BAIER: But do you think this kind of deficit reduction that is happening this week, whatever this deal ends up being, would have happened without leaking it to the debt ceiling increase?

DURBIN: Well, I understand the brinkmanship that's necessary to sometimes bring this matter forward. But let me say, the president did create a deficit commission. I sat on it, a bipartisan commission, and voted for it. And I had at least two, maybe three Republican senators who joined me in that vote.

BAIER: But it didn't make the needed vote to bring it to the --

DURBIN: That's exactly right. We tried to follow up, the Gang of Six. Again, a bipartisan effort. There has been a commitment from the president, as well as many in the Senate -- I just speak for the Senate -- to move forward in a responsible bipartisan way to deal with the deficit.

BAIER: But actually doing it, Senator, actually seeing the cuts, there are many people who believe that if it wasn't linked to this debt ceiling vote, that it really wouldn't be happening.

DURBIN: Well, I can tell you that if we have to risk our economy, a very weak economy, with so many people unemployed and businesses facing higher interest rates, which is bound to happen now because of this brinkmanship that we're engaged in here, that is not a good way to run this nation or the economy. And if that is the strategy coming from the House Republicans, it is not good for our long-term economic growth.

BAIER: Senator Kyl, your colleague, Senator John McCain, read from a Wall Street Journal editorial this past week on the Senate floor speculating about the thought process for Tea Party Republicans in the House who refuse to raise the debt ceiling and believe that the blame would fall to President Obama.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN, R-ARIZ.: Then Democrats would have no choice but to pass a balanced budget amendment and reform entitlements, and the Tea Party hobbits could return to middle Earth having defeated Mordor. This is the kind of crack political thinking that turned Sharron Angle and Christine O'Donnell into GOP Senate nominees.

(END VIDEO CLIP)

BAIER: Senator, do you agree with that characterization of Tea Party Republicans?

KYL: Well, the Tea Party folks in the House who say they're standing on principle not to raise the debt ceiling remind me a lot of Senator Barack Obama, who did the same thing, voting against the debt ceiling increase when he was in the Senate. Sometimes people are just so firm in their beliefs, that they think that they have to vote against the debt ceiling increase even though the majority of us in both the Republican and Democratic Parties believe that that would be a mistake. That is to say that we need to extend the debt ceiling so that we don't get into the economic problems that would exist if we didn't.

But I would disagree a little bit with my colleague Dick Durbin here. While it's true that it's not a good thing that we use the debt ceiling to focus the debate on reducing spending, it has resulted in a change in the president's attitude from a plea debt ceiling -- that is to say, no spending reductions at all -- to an agreement where we will have over $1 trillion in spending reductions now and, in the future, another $1.5 trillion, at least.

BAIER: Let me go back to 2010 quickly, Senator Durbin.

Senate Majority Leader Harry Reid had many opportunities to raise the debt ceiling with a Democratic Senate, a Democratic House, and a Democratic president at the end of 2010, when it would have been sure to pass. He was blunt that, really, what it was about was politics.

Here's what he said in December, 2010 about raising the debt ceiling.

(BEGIN VIDEO CLIP)

SENATE MAJORITY LEADER HARRY REID, D-NEV., MAJORITY LEADER: Once the Republicans have some buy-in on the debt -- they're going to have a majority in the House. I think they should have some kind of a buy-in on the debt. I don't think it should be when we have a heavily-Democratic Senate, heavily-Democratic House, and Democratic president.

(END VIDEO CLIP)

BAIER: So was that a mistake?

DURBIN: Well, I can tell you, it reflected the reality of the situation. Bret, let me give you an example of what we face.

Many of the most conservative members of Congress on the Republican side, House and Senate, have been urging us to stay in Afghanistan, to continue to spend $10 billion a month. We know we borrow 40 cents for every dollar that we spend, so it means $4 billion every $10 billion each time that they want us to spend needs to be borrowed. Now when the president comes in and says here's the debt ceiling, now we have to borrow the money to continue the war -- that's one example -- that you all are in favor of, they're saying we're not going to touch it, we're opposed to the debt ceiling.

What Harry Reid is saying is, if you're going to stand for policies that spend the money, for goodness sakes, responsibly stand up and vote for the extension of the debt ceiling.

BAIER: Sure. But when you're upset about the situation you're in now, and you look back to December, 2010, you could have taken care of it then.

DURBIN: Well, maybe. I don't know if that could have been part of the grand deal that extended the tax cuts across America and unemployment compensation benefits. That's Monday morning quarterbacking.

BAIER: OK. Let's do one last thing. Do you think that this deal, whatever it is, can get through the House?

DURBIN: You're asking me? I don't know the answer to that.

I can tell you that the president is reaching out to both political parties. We're hoping it will be bipartisan in both the House and the Senate, and we'll allay the fears that people have across America that this weakened economy will be hurt more if we continue the showdown.

BAIER: Senator Kyl?

KYL: It's important that we extend the debt ceiling, but it's also important that we look at the details of the agreement. That's what our constituents want us to do, and I'm sure that's what we will be doing over the next several days.

BAIER: Well, good luck, Senators. Thank you.

DURBIN: Thank you.

BAIER: Coming up, our Sunday group on the debt negotiations and the bad news this week about the struggling economic recovery.

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