Snowe, Corker, Barrasso & Labrador on "State of the Union"

Snowe, Corker, Barrasso & Labrador on "State of the Union"

By State of the Union - December 30, 2012

CROWLEY: Joining me from Capitol Hill, Republican Senator Olympia Snowe of Maine.

Senator, let me just start with that. It does seem sort of counterintuitive to have Republicans wanting to fight for tax hikes for no one, and in that fight, being willing to allow tax hikes for everyone?

SNOWE: You know, I would agree with that, because obviously it is important to make sure that middle-income America does not confront a tax increase at the beginning of next year, which is less than two days away. So obviously that is critical. The second part of it is, of course, is trying to address the spending cuts that are going to be crucial next year as well. More for the long-term debt reduction that I think Republicans are talking about, but the bottom line is, we should pass this tax extension for middle-income America before we adjourn this year.

CROWLEY: And what is -- what do you -- where do you think this will land? As we understand it now, there is still a difference of opinion about where exactly that tax rate should end. Is it $250,000 as the president has said, and anyone below that sees no hike in their tax rates, everyone above it does, or do you think it will end up someplace higher to help satisfy Republicans?

SNOWE: It may well end up somewhere between 250 and 400,000. The 400,000 the president had offered to Speaker Boehner during the course of the negotiations, and there is a tax quirk in the law that would actually impact income holders between 250,000 and 400,000, much higher and disproportionately than those who earn more than 400,000. And obviously small businesses.

But nevertheless, I think the bottom line is that the Senate has to step up to the forefront here and address this issue and reach an agreement, build a consensus, get the support of hopefully the majority of Democrats and Republicans, and move it to the House of Representatives. I think it would build momentum. But I do think it's crucial, and I do think in the final analysis that they will reach an accord on this critical matter. I think it would be horrific for the country if at this time, the final days of this legislative session that already has reached historic proportions of failure, that we would now culminate in the failure to extend these tax cuts.

CROWLEY: Senator, you sound willing to go ahead and agree to raising tax hikes -- raising taxes on wealthier Americans and trying to preserve them for the middle class, however that gets defined. What are you hearing among the rest of the Republican caucus? Is that something that would pass the Senate?

SNOWE: I think more likely it would. And obviously there's some other issues that are part of this agreement.

CROWLEY: What are those issues?

SNOWE: Some of the tax extenders, for example, the AMT, alternative minimum tax patch, which is important to middle income. It could affect somewhere upwards of, you know, 30 million Americans.

The other part is the estate tax, and there are some issues that are obviously trying to resolve, if they can get that to be permanent, whether it's 5 million or 3.5 million exemption and what the tax rate would be, 35 or 45 percent. But I think overall, there is an appreciation here about the critical impact of making a decision on this, on this issue, and also to get it done this year, because it's -- it's really troubling in terms of what it portends for the future.

If at this point the United States Senate cannot do what it's designed to do, and that is to build consensus, but secondly that the overall Congress failed miserably in the final days to prevent a tax increase on middle-income America -- and again could create some unforeseen consequences by virtue of the reactions that could occur not only in our own markets but global markets, because we cannot get together and solve the problems for this country.

CROWLEY: Senator, let me broaden that out just a little bit. You are leaving the Senate this time around -- you only have a couple days left, actually -- and your last vote may well be on what has been an incredibly contentious but a really important issue. We are talking about tax hikes for anyone that basically gets a paycheck.

So if it is this difficult to do this on something everyone says, oh no, we can't raise taxes on the middle class, everybody says that, Republicans and Democrats, and yet they can't -- it's been this difficult to come to an agreement, what does that say about the future of immigration reform? What does that say about the future of anything that might be done about increased violence in schools or elsewhere? What does that say about important legislation that many Americans would like to see happen?

SNOWE: Well, it does suggest that it's going to be troubling for the Congress in its next year to reach agreements and consensus on some of these key issues.

The gridlock has really superseded the interests of this country. The political party's interest has superseded the best interests of this country. And that's why I'll be speaking out about the fact that we need the public to be involved and to demand in real-time accountability and transparency on the part of our political leaders and officials and the political institutions to do the job that they were elected to do.

We've got some significant issues facing this country, and they're all going to come to the forefront next year. And if we can't, as you say, resolve this issue at this moment in time, how then can we come to grips, you know, with tax reform and entitlement reform and debt ceiling, a budget we haven't passed in three years, another budget that expires in March of next year? So these are overwhelming issues, and, of course, the world community looks at the United States and says, well, why can't the United States of America and its elected officials come together to address the big issues of our time?

CROWLEY: Senator, you know, a lot of the commentary and some books have been written, say this is on the Republican Party here. Basically, the Republican Party in the House, but many, many people blame Republicans for this, for being intransigent on your side about judgeships, about any number of things. Do you think your party has erred on the side of partisanship and turned its back, in some cases, on the country?

SNOWE: I think that's certainly true, but it also is true on the other side. Obviously, you know, we have responsibilities to bear with respect to the dysfunction and the gridlock, but you know, unfortunately it just grows exponentially on both sides with each congressional session, because they keep looking at the elections and how they can leverage their political positions in the United States Congress rather than what's in the interests of this country.

In the House of Representatives, we've seen this through congressional redistricting, to the point that you really have 35 competitive seats based on a story that was disclosed this week and an analysis. That again, underscores how the deep divide has only grown wider because you have very few centrists left, very few competitive seats, and that is also true even in the United States Senate.

And the political parties want it this way. They want the divide. Because then again, they can build on that, they can capitalize on that in the next election. So every vote becomes about the next election. It isn't about the country.

And that's why I think it's going to be critical for the American people to watch very closely in this next session of Congress and what Congress is doing, whether or not they're in session doing their jobs, in session five days a week holding hearings, but you know, considering legislation on the floor through the amendment process. And it's going to take both sides to get that accomplished.

CROWLEY: Senator Olympia Snowe, as I mentioned, retiring, we certainly wish you well from here. Thanks for joining us this morning.

SNOWE: Thank you, Candy.

CROWLEY: Up next, Senator Bob Corker joins me in studio to respond to the president's assertion that he has a mandate to raise taxes on the richest Americans.


CROWLEY: The U.S. will tumble off the fiscal cliff in less than 48 hours. That's the main reason why President Obama sat down for a lengthy interview this morning that aired on NBC.


OBAMA: There is a basic fairness that is at stake in this whole thing that the American people understand and they listened to an entire year's debate about it. They made a clear decision about the approach they prefer, which is a balanced, responsible package. They rejected the notion that the economy grows best from the top down.


CROWLEY: Joining me now is Republican Senator Bob Corker of Tennessee. Let's start with what the president -- you heard what he just said. And he, look, he argues we had an election, I won. He did campaign quite heavily on raising taxes for those making over $250,000. And he says, I went to John Boehner, I offered him a trillion dollars in cuts, so we're talking 2:1 cuts to income rates. Why didn't you just take it?

CORKER: Well, Candy, that's interesting. I was -- I watched the interview. I don't think any American has ever seen those trillion dollars in cuts that he offered.

CROWLEY: Well, he --

CORKER: And there's never been any specifics. And if I were a president, I certainly would lay those out before the American people.

I've been as involved with this as any senator in the United States Senate, other than Mitch McConnell and Harry Reid. I have never seen those cuts. So I'd love to take those up on the Senate floor.

But let me just say this. Like every American, I'm disgusted with where we are. I know people are irritated at the president, they're irritated at Congress, as they should be. There's no question that in the next few days or the next few weeks, we're going to rescue most of the American people from a tax increase. We're going to do it. It will be better to do it over the next day or two.

But what hasn't happened in this debate is any discussion about real reductions, reforms in Medicare and Social Security, to save those. And I think that is totally irresponsible.

CROWLEY: But there's -- look, here's where we are. There is not time for you to reform entitlements between now and midnight on the 31st.

CORKER: No, and more than that (inaudible) during the debt ceiling debate (ph).

CROWLEY: So here is your choice. You either allow tax rates to go up on everyone --

CORKER: We're going to deal with that.

CROWLEY: Or you try to protect some people.

CORKER: I would bet my life that over the next very short period of time, 98 to 99 percent of the people in the country are going to be rescued.

What's been missing in this debate, Candy, is this has been building for two years now. The president had the Simpson-Bowles committee 25 months ago, give a report. If I were president, again, I would lay out a very specific plan as to how to solve this. The president keeps talking about the $1 trillion that he offered Speaker Boehner. I've never seen it. Have you ever seen it? I was surprised that David Gregory today didn't pursue that in the interview, because he's really good at those kind of things.

So I think if we can get that on the Senate floor also, to deal with this next debt ceiling debate, I've laid out a specific plan, I've given it to the president. I've given it to Senator Reid, but that's what's missing, and what's happening, unfortunately -- we're going to move -- you know, we created this fiscal cliff, and we're going to deal with it over the next few days or few weeks.

But unfortunately, for our country, every American's quality of life is going to be lesser than it should be because now this is going to drag on to the debt ceiling. We're going to have the same kind of thing play out--

CROWLEY: The president says he's not going to play games with -- not going to play politics. He just wants it raised.

CORKER: I think he should go ahead then and lay out the reductions. You know, we set the precedent on a dollar for a dollar, a dollar increase in debt ceiling for a dollar in reductions. I actually laid out a bill to do that this week, with Lamar Alexander.

But I think what's been missing here, Candy, is it appears to me that the president either lacks the courage or the will to lay out those specific things that need to happen. Because I assure you, if he would lay those out, the House would take it up, the Senate would take it up, and we could move this behind us, and we could start this next year with the wind at our back and this fiscal issue behind us, like most of us would like to do.

CROWLEY: You know and I know that's not going to happen in the short time we have.

CORKER: I just wonder why it hasn't. And we will deal with it--

CROWLEY: Well us too -- I mean, you're part of it, right?

CORKER: No, I've offered a very specific bill.

CROWLEY: All of America kind of looks and goes why -- everybody is complaining about the other person, not --

CORKER: No, no. Wait a minute. I actually laid out a very specific bill five weeks ago. Gave it to the White House. Not many people are willing to lay the cards on the table, but it's the president's responsibility, when we have a situation like this, to be very specific about what needs to happen and let Congress take it up.

So look, I think everybody should be disgusted at where we are. We're going to deal with this tax issue, we're going to deal with it either before midnight tomorrow or in the next couple of weeks, but nobody in the country, 99, 98 percent of the people in the country should not be worried about revenues. But what they should be worried about is we still haven't tackled the issue of fiscal solvency.

CROWLEY: It's likely to come up during the debt ceiling. Where is your bottom line in terms of taxes?

CORKER: You know, I'm -- I feel so certain, Candy, that something's going to happen on the Senate floor over the next day and a half. I don't even want to -- Mitch McConnell --

CROWLEY: Would you -- if Mitch McConnell says, look, $250,000, everybody above that is going to get a tax hike, are you there, aye?

CORKER: Say again?

CROWLEY: If Mitch McConnell comes out and says, look, here is the best we can do, $250,000 and above, it's going to get --

CORKER: But he's not going to do that.

CROWLEY: -- a tax rate hike?

CORKER: Because -- he's not going to do that. Let me tell you why. Senator Schumer doesn't want to see that happen. Kirsten Gillibrand doesn't want to see that happen. Dianne Feinstein doesn't want to see that happen. So it's not going to be at 250. But some number. There's going to be -- I don't know what it's going to be. We know it's probably -- the floor is at least 400, because that's already out there. So my guess is, we're going to be in -- I don't even want to say it, at least 500, and my guess is it's going to happen and it's going to pass.

But here's the thing. You're talking about eight days of funding for the United States government.


CORKER: We have a Medicare --

CROWLEY: When the (ph) spending (ph) comes in.

CORKER: We have a Medicare program where people are paying one third of the cost, and 20 million more Americans are going to be on it over the next ten years, and we have yet to deal with that.

CROWLEY: Let me ask you about one other thing that the president said during this interview. He was asked about Chuck Hagel, used to be a Republican senator. His name has surfaced as a possible secretary of defense. There have been complaints about him, about some votes that he made, vis-a-vis Iran, also some comments that he made about gays and some other things he said about Israel, and here was the question from David Gregory.


DAVID GREGORY, NBC NEWS: Anything disqualifies him?

OBAMA: Not that I see. I've served with Chuck Hagel. I know him. He's a patriot. He is somebody who has done extraordinary work both in the United States Senate, somebody who served this country with valor in Vietnam. And is somebody who's currently serving on my Intelligence Advisory Board and doing an outstanding job.


CROWLEY: Do you have any problems with Senator Hagel?

CORKER: Well, I never thought Susan Rice was going to be nominated after her name came forth, and she wasn't. I don't think Chuck Hagel is going to be nominated.

CROWLEY: You don't? Why?

CORKER: I don't. I just -- look, I always start out and give people a fair hearing. I served with Chuck for two years, but I just heard too many very, very strong opinions both on the Republican side and the Democratic side about his positions, and I don't think he's going to be nominated. So if it comes up forth, certainly I look forward to knowing more about his background and having a real hearing, but I would be very, very surprised if Chuck Hagel is nominated.

CROWLEY: Senator Corker, thank you for your time this morning.

CORKER: Thank you, thank you so much.

CROWLEY: Have a busy day ahead--


CORKER: We do, and I -- I -- the American people should know that this is not going to linger, and we're going to deal with this issue. We should have done it a long time ago.

CROWLEY: Or linger any further probably is--

CORKER: That's right. Thank you.

CROWLEY: Thanks so much, Senator Corker, appreciate it.

CORKER: Thank you, thank you.

CROWLEY: We are waiting for today's rare session of Congress to begin at 1:00 p.m., about 40 minutes from right now, but next, we'll go live to Capitol Hill for an update on how we expect today to play out.


CROWLEY: I want to take you up to Capitol Hill now and our senior congressional correspondent Dana Bash.

Dana, how do we expect to see things unfold over the next couple of hours? We have got about, what, a little over 30 minutes before they convene?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: That's right. We are told not to expect any big breakthroughs to be announced when they do come in. But they are coming in at 1:00. And I'm told by an aide to Senator Mitch McConnell, the Republican leader, that we do expect -- we should expect to hear from him.

Just to sort of give people a sense of the fact that they are still talking, again, I don't expect him to show his cards because they are definitely still being held very close to the vest because these talks are still continuing one floor below me, where I am right now.

CROWLEY: This morning, Dana, both at 9:00 and now, so far, at noon, I've heard a lot of optimism from Democrats and Republicans. It's hard to tell often when a politician is about to get nailed for not doing something, how much of this is wishful thinking and how much of it is actual. What are you picking up, up there?

BASH: You know, I checked right before coming on with you, with Republican and Democratic sources, and they are saying the same thing, that things are going well, that talks are proceeding, and then the next breath I get the "but," but we are not there yet, but there are a lot of outstanding issues still left on the table.

And I'll just give you a couple of examples of what we are being told are outstanding issues. First and foremost, the issue which are tax rates, how much will go up and for -- at what income and how many of these tax cuts will stay in place?

Democratic sources are saying that they think at this point, they see it being at about an income level of $250,000 to $400,000. Republicans say that they want it to be more than $400,000, meaning they want tax cuts to stay in place for even upwards of people making $400,000.

Another thing that I'm told is -- a sticking point, is the sequestration, you know, the $110 billion of pretty draconian spending cuts that will start to take place on January 1st. I've heard the Democrats are saying, well, maybe we can just replace that with some of the revenue we get from these tax increases.

And Republicans are saying, oh, no, we're not going to do that because they want to get to deficit reduction by spending cuts and that, of course, is what the sequester is. So that's one of the sticking points.

But, again, I'm told one of the many, many sticking points right now. We're going to possibly see Republicans and Democrats meet in their respective corners to try to get a briefing from the leaders about what's going on at 3:00 Eastern, but I'm also warned if talks continue, that that might be pushed back as well.

But that's the next timeline that we're looking for, 3:00 Eastern.

CROWLEY: I think thematically what we are hearing from Republicans is, where are the spending cuts? And we heard the president this morning also reiterate that he thinks some of those tax hikes could help mitigate that $110 billion or so that is being taken out of, you know, across-the-board cuts.

So we will see you later on this afternoon, Dana, as you follow every minute of this. Thanks a lot.

BASH: Thank you.

CROWLEY: President Obama says slashing the deficit is a priority but so is more spending on certain things. We'll talk with two Republican lawmakers about the president's second-term agenda, next.


CROWLEY: One of President Obama's initial proposals to avert the fiscal cliff included $50 billion in new infrastructure spending. That, as we know, landed with a thud among congressional Republicans. But despite that reaction, it doesn't seem like the president is backing down.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The second thing that we've got to do is to stabilize the economy and make sure it's growing. Part of that is deficit reduction, part of it is also making sure that we're investing, for example, in rebuilding our infrastructure, which is broken.


CROWLEY: I'm joined now by two Republican lawmakers Wyoming Senator Barrasso of Wyoming -- as we just said, and Idaho congressman Raul Labrador. Gentlemen thank you for joining us.

Let's talk first about new spending. I mean, investment, generally, means you want to put more money into infrastructure -- bridges, roads, schools, things like that. Is that something that you all might go along with? Is that a nonstarter?

BARRASSO: It's a nonstarter. The president really -- and you have pointed to the problem -- the problem in this country is we have a spending problem, that's how we ended up with $16 trillion in debt. And yet the president doesn't talk about ways to minimize the spending or actually get the economy growing. You know, that's one of the things he proposed was an additional stimulus package and then he wanted an unlimited credit card to be given to him so he can continue his spending binge.

We're hitting the debt limit again tomorrow.

CROWLEY: And -- but what the president is saying and has said all along -- and a number of Democrats, Treasury Secretary Geithner says, wait a minute, we did a trillion in cuts the last time around with the debt ceiling, the president says he offered Speaker Boehner of the House another -- an additional $1 trillion so it would be two to one in savings to tax hikes, what's wrong with that?

LABRADOR: It's not a trillion dollars in cuts. He talked about this morning on "Meet the Press" that he wanted to do away with the sequester by raising taxes on people.

CROWLEY: So let me just define the sequester which is basically spending cuts that were also part of this fiscal cliff.

LABRADOR: So he's taking credit for the spending cuts in the sequester in the Budget Control Act, but now he wants to do away with them and then wants to do more infrastructure spending and he wants to do all these different things, plus he wants to pay $1.6 trillion in additional revenues and just a couple days ago he decided that he was going to start paying federal employees more. He did away with the freeze on federal employees' salaries.

So he want to raise taxes on people so he can pay federal employees more. And I don't think there's anything out there saying federal employees are not making enough money.

What he wants to do is he wants to continue to spend more money. And I believe -- and some of my colleagues disagree, even Senator Barrasso I think disagrees with me, I think the president wants to go over the cliff. He doesn't want -- he's not acting in good faith right now.

You listen to him this morning, what he was saying on "Meet the Press" he's saying he came with a plan that was a balanced approach. A balanced approach, he talked about two to one, three to one, we don't have a two to one or three to one and as Senator Corker said a few minutes ago, where are his spending cuts? There's not a single plan out there with spending cuts. CROWLEY: You -- I understand the politics of this town fairly well. But -- and you're not the first to suggest that the president wants to go over the cliff but there are a lot of people saying so do Republicans, because Republicans would rather vote for restoring tax cuts to people than getting rid of them for some people.

So I mean, two can play this game. And in the end, the problem is, nobody's gotten the job done.

BARRASSO: Patty Murray who chaired the Democratic senatorial campaign committee has advocated going over the cliff so the taxes would go up, more tax revenue would come in for more programs that they would have all of these military cuts that the Democrats have supported and they could claim they'd have an opportunity to blame Republicans.

But the president the night that he was re-elected said I don't want our children to live in a country where they are burdened with debt. The president has done absolutely nothing, nothing at all, to focus on that and even in his interview today, he has again not gotten serious about tax reform or reforming the entitlement programs when 10,000 Baby Boomers today are turning 65 and they did yesterday and they will tomorrow.

And as you said earlier, people are focused on the Redskins game tonight. Every week there are enough people turning 65 to fill that entire football stadium. And we need to grow the economy to make sure that we can keep that safety net for those people.

CROWLEY: Here's the thing. You're not going to do tax reform in the next 48 hours. You're not going to do entitlement reform in the next 48 hours. You all had a year, or two years, however long, it's not going to happen. So right we're staring down and looking at everyone's taxes going up. Is that going to happen or do you think the House and the Senate with Republicans going along, will vote for something that would raise taxes on the -- in the upper brackets, but maintain them for middle-class Americans?

LABRADOR: I think something is going to happen. I don't know if it's going to happen in the next 48 hours. Whatever happens, whether it happens the first month with congress, whether it happens in the next 48 hours, I think the majority of Americans are going to be safe from a tax increase. But the reality is that we need presidential leadership. We've had two years to deal with this mess. He has not led at all. We've had -- he's had four years in the White House. He's going to have an additional four years in the White House. He needs to do what Bill Clinton did. He needs to do what President Reagan did. President Reagan was willing to sit down with the Democratic Speaker of the House and work on real common sense solutions.

CROWLEY: He met with Speaker Boehner.

LABRADOR: He sat down once in the last two months.

CROWLEY: But wasn't the problem that Speaker Boehner couldn't get his House Republicans to go along even with his Plan B.

LABRADOR: You keep saying that, but look at Plan B. Plan B was a plan that was advocated by Nancy Pelosi, was advocated by Chuck Schumer just less than two years ago. They said that what we should do is raise taxes on people that make a million dollars or above. There were only 50 House Republicans who said they were not going to vote for Plan B.

You couldn't even get 50 House Democrats to vote for something like that, to send something to the Senate and then the Senate could maybe raise taxes on people that make less than that. So don't blame the Republicans when it's the Democrats that are unwilling to work on anything.

When the president said that he wanted to look at chain CPI, it was the Democrats who said.

CROWLEY: That's would be changing the way...

LABRADOR: That's a nonstarter.

CROWLEY: ...changing the way Social Security payments are attached to the cost of living.

BARRASSO: The Democrats in the senate are very divided on what that tax rate should be as well as on taxes on small business as well as the death tax. They are very divided on this issue.

CROWLEY: The estate tax, yeah.

So let me have you answer that question quickly, because I have another subject I want to bring up. But do you think there will be a deal and that most taxes will not go up?

BARRASSO: We're not there yet, but I'm hoping in a bipartisan way we can get something done before New Year's Day.


Let me -- I wanted to play you something else, particularly because you were an immigration lawyer before you came in, continues to be something you're interested in. And the president was talking about priorities for this year. And here's what he had to say.


OBAMA: I've said that fixing our broken immigration system is a top priority. I will introduce legislation in the first year to get that done. I think we have talked about it long enough, we know how we can fix it, we can do it in a comprehensive way that the American people support. That's something we should get done.


CROWLEY: Sounds like it could be a done deal. Talked enough about it. What do you think? LABRADOR: I think he has talked enough about it, hasn't done enough about it. If you look, that was the first promise he made to Hispanic community that he was going to work on immigration reform did nothing his first four years. I want to work with the president on immigration reform. We have a broken system like you said. I actually practiced immigration law for 15 years. It's a broken system. It's a system that you can't get can employers and employees to actually work within the system. We have too many people that are here illegally. I think we can get something done.

The question is going whether the Democrats want to play politics with it or whether they actually solve the problem. If you remember, in 2007 when Barack Obama was in the Senate, he voted for poison pill amendments in the Senate that actually killed any kind of immigration reform where the senators were -- were not able to get anything done because the Republicans walked away once the pro labor union amendments passed in the Senate. And those amendments passed 48 to 47 and Barack Obama was the deciding vote.

CROWLEY: Senator, let me get you in on this, do you sense a will in the Senate to get something done, immigration reform? Do you sense in the Republican Party there is a need to get immigration reform done because it really hung up Republicans certainly during the election?

BARRASSO: Well I do sense that. I've worked and discussed these issues with Marco Rubio who's taking a leadership role in that.

One of the other things the president talked about today was energy. I'm from an energy state on the energy committee and yet his actions are very different than his words in that interview. He continues to block the Keystone XL Pipeline which would help us in terms of energy security and bringing more jobs to America, so his words are very different than his actions and we see it again on energy with his policies.

CROWLEY: So, Senator Barrasso, thank you so much for being here.

Congressman Labrador, both of you come back. I appreciate it. LABRADOR: Thank you very much.

BARRASSO: Thanks. 

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