BLITZER: Chuck Schumer, the senior senator from New York, is joining us right now. He's obviously been a player in all of this.

Senator Schumer, thanks very much for coming in.

But I assume you're very happy that this deal looks like it's going to happen.

SEN. CHARLES SCHUMER (D), NEW YORK: Yes, we are very glad because it's a win for the American people. To have the middle class payroll tax cut expire would have been bad for middle class families and bad for our whole economy, so we're glad that the House has come to its senses and basically passed the Senate bill. They suggested a technical correction which is a good one, but the Senate bill is largely passing intact.

BLITZER: So, correct me if I'm wrong. Basically, the House/Senate conferees, the members, are going to have two months right now to work out a deal that will allow this tax cut to continue for the rest of the year, allow unemployment benefits to continue, and allow these Medicare reimbursements for physicians to continue. But that's easier said than done, isn't it?

SCHUMER: It is. And we will see if our House colleagues really have good faith. If they do what they did on their first bill, load it up with so many things that make it unpalatable to just about anybody, then we'll know that they're really not with good faith to get this done for a year. But there are -- because of the work of the super committee, there are pay-fors that are not easy, but can bring about bipartisan agreement.

That will be the job of these conferees, and hopefully the extreme wing in the House, who initially was against any payroll tax cut, then was only for one if it was so loaded up with things that were unpalatable to the rest of us that we were never going to get one, if they don't run the show, we can get this done. If Speaker Boehner continues to let them run the show, then we won't be able to get it done. It's that simple.

But this is a good first start. Speaker Boehner has ultimately prevailed over this hard-right minority in this caucus, and hopefully it's a metaphor for the future, because for a while, they wouldn't take yes for an answer, and now they finally have.

BLITZER: Now, the Republicans, almost to a person, they say no new taxes on even millionaires and billionaires. Is it fair to say that the conferees, from the Democratic perspective, that you guys have given up a tax surcharge, if you will, on people earning more than a million dollars to pay for the continuation of this payroll tax cut for the middle class Americans?

SCHUMER: Look, we think that's the fairest way to go because everyone has to give a little bit here, and those at the highest income levels, over a million dollar incomes, have done the best in this economy. So that should still be on the table.

Obviously, we have to come to a compromise, but it is the view of many Democrats that having those of incomes over a million pay a fair share of this makes some sense. But we want to have a compromise. We want to get this done. We want a yearlong extension because it's good for the economy and good for the middle class.

And I would just say one other thing, Wolf. Let's hope that now we have turned the page.

There was a small group in the House that basically believed in brinksmanship and paralysis of government until they got their way on just about everything, and it led to the kind of paralysis, the kind of gridlock and deadlock that we saw this past year. But this was the first time they sort of had to wave the white flag. And let's hope it's a metaphor that mainstream conservatives, but not those way out on the deep end, will be involved in running the Republican caucus, and Democrats and Republicans can come together in a bipartisan way.

And the first real test will be extending it for a year. If people insist on things that are unpalatable like cutting Medicare or eliminating the president's health care bill, we'll know we're back to the old ways, but hopefully that won't happen.

BLITZER: Senator Schumer, thanks very much for coming in.

SCHUMER: Thank you. Good to be here.