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Reps. Huelskamp and Hayworth on the Debt Ceiling

Reps. Huelskamp and Hayworth on the Debt Ceiling

By John King, USA - July 21, 2011

JOHN KING: Fifty-two percent of Americans say the president has acted responsibly in this showdown. Forty-six percent say he hasn't. Only 33 percent of Americans say Republicans are acting responsibly. Sixty-three percent say they are not. So, let's go inside the critical House debate now with two members of the freshman class that delivered the majority to Republicans and the speaker's gavel to John Boehner.

Nan Hayworth represents New York's 19th Congressional District. That's a moderate swing area just north of New York City. Tim Huelskamp is from the 1st District of Kansas. That's a more conservative area once back in the day represented by then Congressman, later Senator Bob Dole. Thanks both for being with us tonight.

I want to start with this message from the Chamber of Commerce, the message from Standard & Poor's. Congresswoman, to you first, do you believe if we got to August 2nd and there's no deal and there was a default, do you believe the warnings it would have a catastrophic impact on the American economy?

REP. NAN HAYWORTH (R), NEW YORK: John, certainly I have been well persuaded that it would have a substantial impact on interest rates, and that includes, of course, what happens on main street, not only on Wall Street. So, the resolve of this member, and I think of the majority of the conference, if not everyone in the conference, is to get this issue settled by August 2nd.

KING: So, to get it settled, Congressman Huelskamp, to get it settled by August 2nd, you can't get your way. The House passed its plan. It will fail most likely tomorrow in the Senate. Then what happens? Are you willing to sit down and authorize your speaker to sit down with the president of the United States and negotiate a deal that gets you much of what you want but not all of what you want or if there are any revenues in that plan, would you say, no way, I'm walking away?

REP. TIM HUELSKAMP (R), KANSAS: Well, John, I think it's very premature to presume to know what the U.S. Senate has done. They've not taken a vote yet on this issue. They are going to have a clear plan on the table. They've got no detailed plan. The president has no detailed plan and that's frustrating as a freshman to say, hey, we're going to negotiate with some folks that won't identify a solution. And Cut, Cap and Balance is a solution. It's balanced in terms it deals with the necessary spending cuts but it does give the president his debt ceiling increase and I think that's a reasonable balance.

KING: You say it's a reasonable balance and I certainly, sir, respect the promise you made to the voters when you ran on it, but we have a divided government right now, and the House of Representative which has passed its plan and you like that plan. I can do the math pretty well. Our Hill reporting team can do the math pretty well. They say the votes aren't there in the Senate and the president said even if it cleared the Senate he would veto that.

(CROSSTALK)

KING: Go ahead.

HUELSKAMP: John, the thing about Congress is you've got to let them vote. You've got to let them vote. There are 23 U.S. senators that have said over and over in their district they support a balanced budget amendment. This is part and parcel of helping pass a balanced budget amendment and those 23 senators many of them up for re-election are going to have to go home and explain to the voters why they promised one thing and delivered another. So you can do all your reporting counting but the final vote will be on the Senate floor and as a freshman I look forward to them casting their first vote on this issue after months and months of discussion.

KING: We look forward to the vote. I look forward to this debate moving forward anyway. Congresswoman, let me come back to you. The president has said and I respect what the congressman says, let's let the Senate vote. The president said even if the Senate passed it, he would veto it. Now maybe you could say if the Senate passed it, he would, but if we get to the point, if we get to the point where we need a new plan, are you willing to support a plan that has some new tax revenues in it if that's the best the speaker can get?

HAYWORTH: I think, John, if the plan is to bring revenues in through growth, that's something that a lot of Republicans can support. We can't have any net tax increases. That's anti-growth, John, and that's the key. We can do lots of great things to bring this debt under long-term control and we need to do them and we need to do them by being fair to the 14 million Americans who are desperately seeking employment and who can then contribute their fair share to the workings of the federal government. That's really what we're talking about when we talk about no net increase in taxes. Let's get working capital back into the economy.

KING: So, here's my rough understanding of what the speaker and the president have talked about. It would be about $3 trillion in long-term, over 10 years, deficit reduction. It would have substantial cuts in the Medicare program. It would have some changes to the Social Security program. It would cause for some defense cuts and some other cuts in the domestic discretionary spending. The Bush tax cuts would then expire on 2013, which is right on the books now anyway.

Congress would have to act to change that and then the speaker and the president would have a commitment for the Congress to work on tax reform which would go from six brackets hopefully to two or three brackets with lower rates, but tax revenues to Washington, then, as a result would come up. Congressman to you first -- are you OK with that?

HUELSKAMP: Well, John, we're looking for the details. And I visited with the speaker just a couple of hours ago. There is no deal. There are discussions. And it's amazing how people claim to know what's in a deal even before it's been reached and agreed to. But frankly, I agree. We need more revenue, and we do this by putting folks back to work, by letting the economy create more jobs. Instead of hammering small businesses across the country we need to encourage them.

We need lower regulation. We don't need higher taxes. That's the way we get more revenues. And most Americans are very supportive of that concept. They recognize Washington is not helping to create jobs. We have 9.2 percent of Americans out of work, 14 million Americans. We need them back to work. We passed multiple job bills through the House and they refused to consider those in the Senate and the president hasn't presented a jobs package either. That's how we have more revenue. KING: I just hit an important point, so I want to stick to it because there's an impression out there that some Republicans, they just simply don't trust the process and so they don't want any deal that could lead to more revenues. But if I'm hearing both of you right, if your plan fails in the Senate, and I understand and respect you want to see that one go forward first, but then you would be OK voting for a deal that had some things you didn't like, like the Bush tax cuts expiring as long as there was a promise that Congress would work on overall tax reform that would lower rates.

HAYWORTH: I will not favor expiring -- allowing the Bush tax cuts to expire, John, if there's a net tax increase there. That sure sounds like a net tax increase and I have trouble believing that our speaker and our leader negotiating with President Obama haven't made that adamantly clear. We can certainly make the tax code flatter and fairer. There's a lot of opportunity to change the entire system of exemptions so-called loopholes without raising net taxes and activate the economy. And, John, that's the kind of tax changes we're talking about, not about a net tax increase.

KING: Let me ask you, we're going to have to wait probably several days before we see how this plays out before we have more details of what would be a plan "b," "c," "d," or "z." So let me ask you a more philosophical question. You're this new Republican class. You are the reason John Boehner is the speaker of the House.

What are the conversations among you as a group? And you represent two very different districts. So I'm wondering if you agree on this point, in the sense that this is what we promised. This is what we're here for and if we have to vote no and even if the country were to go into default and even if we were to lose our seats, is that how important it is to stand your ground here?

HUELSKAMP: Well I think what's going on here is pressure coming out of the White House, the Treasury Department picked the date of August 2nd. As far as I know we're still kind of looking at what the actual cash flow numbers are. And we certainly don't want to have a default, but if there is a default, it would be the president's choice in my opinion. This is the president that threatened to withhold Social Security checks just seven days ago and that was wrong to say that, and so we need to be honest in negotiating. We need a detailed, written plan from the president. We need a detailed, written plan from Senator Reid. We listened to your polling as we went in here. There was no discussion of U.S. Senate.

Where is their plan? What is their discussion? What are they going to pass? They never passed a budget in 811 days. They have no deficit or debt ceiling plan. We sent Cut, Cap and Balance over there. I encourage them to consider that and have a full, open, and honest debate, but tax increases on job creators, on small businesses across America that doesn't create jobs. What creates jobs if Washington could do less regulation and unleash entrepreneurs across America that would create more revenues? I do not believe we need to repeal what I call the Bush/Obama tax cuts. They were continued under this president. I think they should continue in the future so we can create more jobs. HAYWORTH: John, we are not going to let the nation go into crisis based on the actions that we take here. We are here to solve problems, not to make them worse. We are here to put 14 million Americans back to work. We are here to revive the economy. And we will assure that that will happen in the timely fashion, a deadline will be met. I have every confidence in our leaders to make that happen.

KING: Congresswoman Nan Hayworth, Congressman Tim Huelskamp, appreciate your time tonight. We're going to keep in touch as this one plays forward, a dramatic moment for the country and a big moment for the freshmen House Republican class. Thank you both for being with us tonight.

 

John King, USA

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