[ singing scat ] captioned by closed captioning services, inc. >> chris: i'm chris wallace. it's crunch time in the debt ceiling talks and neither side is backing down. with president obama and congressional republicans dead locked, we will get a read on where things stand from two key house members. jim jordan, chairman of the house republican study committee. and chris van hollen, the top democrat on the budget committee. it is a fair and balanced debate, only on "fox news sunday." then, the gop presidential race. we'll sit down with candidate herman cain as we continue our series 2012, one on one. and for all of the talk about possible default on august 2, the real focus may be election day 2012.

we'll ask our sunday group which party is gaining the upper hand with voters next year. all right now on "fox news sunday." thehello again from fox news in washington. with just 16 days to go 2348 our country reaches the debt limit and with threats from rating agencies to downgrade the nation's credit, what deal is still possible? here to discuss the options are two keys house leaders. jim jordan and chris van hollen. congressmen, welcome back to "fox news sunday." >> good to be with you. >> chris: this week the house about vote on something called cut, cap and balance. let's outline what it would do. cut the deficit $111 billion next year. you would cap spending under 20% of gdp in. it is now 24%. >> and you would raise the debt ceiling only after congress

passes a balanced budget amendment. congressman jordan you are big sponsor of this. president obama says that it would cut medicare and social security much more deep ply than paul ryan's budget plan. >> we like to view it as a common sense american plan. americans know we are spending too much. we are headed for a cliff. we are headed for bankruptcy. cut spending in year one and cap it as a percentage of the economy going forward. everyone understands our government is getting too big. let's do something historic. let's for the first time in american history pass a balanced budget amendment through the house and senate and send it to the states. let's make the federal government, the entity that has a $14 trillion debt, make us live under the requirement that everyone else has to live by. >> chris: what is wrong with cut, cap and balance and what are the chances it will get through the house and national and get signed by the president? >> no one should be fooled by this. they are not proposing a clean

balanced budget amendment. they are proposing to manipulate the constitution and use it to impose the republican budget plan. if you look at the plan it does end the medicare guarantee. slashes medicaid and slashes deeply into education and protects tax breaks for special interests. they would write that into the united states constitution under their proposal it would be easier to cut medicare than it would be to cut subsidies for oil and gas companies. you have a majority vote to cut medicare and create special interest loopholes. you need two thirds to close tax breaks. that is an antimajorrity provision. framerwould be turning in their graves if this passed. >> chris: what are the chances this will become law? >> if you don't do this, the united states will default on its debt. >> chris: i want to give you a chance to respond. as we said, this are just 16 days left before we hit in

august 2 deadline. even if cut, cap and balance is as good as you say it is, should we be spending precious time what outside observers say is not going to become law? >> of course, we should. this is something that fixes the problem. we have to do big bold things or we are headed for a debt crisis. to call balancing the budget dangerous is unbelievable. >> that is not what i did, jim, i said your version of that. >> mr. president, put a plan on the table. democrats put a plan on the table. we have 16 days injuries for the next two weeks if the president can ever put details to the plan. have the american people decide do they want cutting spending and capping the growth in government and requiring an amendment to the constitution. let's have a national debate. >> i didn't say it was dangerous to balance the budget. we want to balance the budget. the budget they passed doesn't get into balance until the year

2040. the balance, the budget they voted for would require you to lift the sent ceiling by $8 trillion between the years now and -- >> chris: gentlemen, we have a lot to cover. let's move on to the next thing. we will get back to a bunch of the issues. if cut, cap and balance fails. most people say whether it is good policy or not that the chances it is actually going to pass in the next two weeks are pretty slim. the most likely fallback is some version of mitch mcconnell's fallback plan. it would allow the president to raise the debt limit $2.5 trillion without any spending cuts but there is talk about including more than a trillion dollars in cuts and setting upper in debt commission. congressman van hollen, wouldn't that be almost a total failure by democrats who control the senate, who control the white house to do anything serious about your debt when we have a $14.3 trillion debt? >> i'm not a fan of the mitch mcconnell deal.

>> me either. >> we can agree on that. it does punt it. what it does is says we the congress will not take responsibility or accountability for our own decisions. it is a political answer, not a real answer to the problem. now, whether we are driven in that direction by events, i don't know. we also want a big deal. the president did put a grand proposal on the table. >> chris: we will get to that in a second. if it is a choice because the clock is ticking, 16 days, if it is a choice between the mcconnell plan or nothing, not raising the debt ceiling on august 2, are you going to vote for the mcconnell plan? >> i'm working hard so that that is not our only choice. i will say that. we cannot default on our debt. americans can't choose not to pay the bills they incurred and we know what that catastrophe that would be. i know there have been bills introduced in the house that suggest you can sort of skate by this, standard & poor's, moody's, chamber of commerce,

they all say it is not so. >> chris: stay on the mcconnell plan for a moment. if it comes down to that -- you are already shaking your head. if it comes down to the mcconnell plan or going past august 2. >> the mcconnell plan doesn't have 218 republican votes. there is all kinds of conservatives who will not support the mitch -- as chris pointed out. >> chris: i want to hear you just say, you are saying that the mcconnell plan will not pass the house? >> who knows if there is a combination of rs and ds that will go for it. house conservative members, members of the republican -- they are not going to support the mcconnell plan. i'm not going to support the mcconnell plan. this is just kicking the can down the road. the american people sent us here to make tough choices. they didn't send us here to set up a commission and give the president veto power. i keep coming back to put plans on the table like we did. the only plan out there is the cut, cap and balance plan. let the american people look at

this and let's have a real debate. this is so important for the future of this country. we are headed for a cliff. if we don't fix it, now we are in big trouble. let's have that national debate, not some copout like the mcconnell plan. >> chris: president obama continues to say that he wants a big deal over $4 trillion in spending cuts and tax revenue increases. congressman van hollen, part of the problem is and this is something that congressman jordan has said several times now is that he is not specific. especially on spending cuts and especially on entitlement. let me put up something that the head of the congressal budget office said. he said we don't estimate speeches. we need more spinach fiscal commissionity than was provided in the speech for us to do the analysis. the fact is the president talked with great detail about what he wants and revenue increases. but he is not specific at all when it comes to what he will

take in spending cuts. >> well, the president has put a framework proposal on. he has been in discussions with speaker boehner. they were at the white house hammering out a lot of the details and the president has said that the framework that he wants to approach not every detail but the framework is the simpson bowles, the bipartisan plan. the reason the discussions could not continue is because your republican colleagues refused to agree to close even one corporate tax loophole. they refuse to talk about the folks at the very high end, simply going back to the rates that were in place during the clinton administration. that is sort of a conversation ender if you are not willing to talk about ending subsidies to oil and gas companies for the purpose of debt reduction, where do you go? >> chris: let me ask you about this and you can give whatever answer you want. you were reportedly congressman jordan one of key players who forced speaker boehner to walk away from talks about a grand

bargain. i understand there is a legitimate issue with fuzzy numbers coming out of the white house. assumeing that you could solve that problem, you are unwilling to accept $3 in spending cuts for every $1 in revenue increase? >> a couple of things. think about the president's frame work. there is no specificity to his proposal. he is saying all of the spending that the democrats did in the last congress that we all voted against and that the american people didn't like as evidenced by last november's election, the president is now asking us, hey, republicans, vote for a debt ceiling increase even though you campaigned against it and the voters elect you to be against it. vote for it to pay for all of the spending and just to add insult to injury, by the way, support tax increases while you are at it. it puts no specificity to any plan. >> chris: if i may. assuming there were specificity would you not accept a formula of $3 in spending cuts? this is a liberal democratic president talking about $3 in

spending cuts including entitlements. >> they all take place in the out years. he never gives us detail what is going to happen the first year which is the only year that counts. the spending cuts on the outyears. the tax increases are going to come soon. and the american people this is the old cliche, louis and charlie brown the football. the american people are saying we are not falling for that any more. if these tax things are so bad that chris talks about, the democrats just controlled owl of government 8 months ago, why didn't they get rid of them. you had the house and super majority in the senate until scott brown got elected. why didn't you get rid of all these. if they are hurting the economy and keeping us from getting to a deal. why are you doing them now? >> chris: i want to ask you one question first, the polls show only 20 to 25% of americans want a deal that is only spending cuts. >> they also show americans don't want tax increases.

here is what we all know. you raise taxes on the job creators and small business owners who make our economy go, you raise it on them now, when you have 9% unemployment you are making it that much more difficult for jobs to grow. they also understand the basics. government spends too much. it is not a revenue problem, it is a spending problem. everyone gets that basic point. >> chris: congressman van holen. >> cbo said the number one driver, policy decision driving the need to raise the debt ceiling and the big contributor to the problems were the tax cuts in 2001 and 2003 that disproportionately hit the -- >> chris: wait a minute. i just read yesterday that barack obama has increased our debt 35% in the last two and a half years. that is not the bush tax cuts. >> $3.8 trillion in the last two and a half years. >> the biggest driver of the debt is the economy going down. that is a -- that is not a

policy decision. >> chris: how about the trillion dollars for the stimulus. >> that is a short-term thing. we all know that was a short-term thing to get the economy going. >> but it didn't work. >> it is not a long-term driver of the debt. get the facts straight here. you asked the fundamental questions. are they willing to take a bargain, $3 in cuts to one dollar in revenue increases. the revenue increases they talked about begin in 2013. nothing in the short-term. the president talked about payroll tax holiday. number two, we are talking about closing corporate loopholes and go back to the same rates during the clinton administration which was a time when the economy was booming, 12 million jobs added. because they won't even talk about that frame work, three to one, the conversation ends. >> chris: this what w we have just seen here is the problem quite frankly. 16 days to the debt deadline. congressman jordan, you say that the world isn't going to end on august 2.

you say the world isn't going to end on august 2, that we can pay our bond holders with the revenue that is coming in and we will prioritize the rest of the spending. here is the problem and let's putt it up on the screen. the bipartisan policy center. he was a treasury official, jay powell, did an analysis of what the government would have to cut. 44% in other spending. even if you pay social security and medicare benefits you have to choose among military salaries. veterans benefits. unemployment insurance. the fbi. the faa. and the biggest bond company the bond fund which already sold, they have already spoken with their wallet, already sold most of their treasury securities. he says the market situation might resemble what happened after lehman brothers collapse in 2008. this isn't a politician. this is the market talk. >> standard and poors is saying if we don't do something real

they will downgrade us whether the debt ceiling gets passed by august 2 or not. where we are h headed, the big crisis that is coming is more important than anything now. if in fact we get past august 2 the president has to lead and make some choices. he has to prioritize. and there is enough money in the month of august to make sure we pay the bond holders. make sure we pay social security recipients and troops in the field. after that the president has to do something he is willing to do right now. he has to make decisions and lead. >> chris: you are saying that is preferrable to pass the mcconnell fallback. >> pass cap and balance. >> chris: which is preferrable, mcconnell plan or go past august 2. in. >> mcconnell plan kicks the can down the road. >> what you heard is unless you you pass a constitutional amendment that puts their proposed budget plan in place -- >> someone has to tell me what is wrong with letting the state decide whether we should have a

balanced, 49 out of 50 states have it. every municipality. every township government and city government and every family, every business. >> you have a prosix in there that makes it easier to cut medicare. it is not a real balanced budget amendment and you know it. >> chris: we have to end this segment, gentlemen. >> let me say this. if you allow the united states to default on its debt. >> no one wants that. >> it going to hurt every family out there in america. >> no one wants that. but a balanced budget requirement which everyone else has to live under. >> chris: you got your last segment. >> read your own bill. >> chris: i'm glad we were able to settle all of this and arrive at a deal. thank you both. we will see how this plays out over the next 16 days. up next, presidential candidate herman cain and they are shaking hands off camera. presidential candidate herman

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>> chris: with few fund raising numbers out and the iowa debate and straw poll let's than a month away, we continue our 2012 one on one series with republican presidential candidate herman cain. welcome back to "fox news sunday." >> thanks, chris. i'm glad to exercise my right to return to your show. >> chris: you pland that one. that's very good. >> chris: you say we don't need to raise the debt ceiling and this will not be a financial armageddon. but the chairman says tle be a financial calamity.

the head of pimco says it could cause another mark collapse. you talk about listening to thion perts. aren't you ignoring them. >> that is one expert. >> chris: i just mentioned two. >> i'm listening to many others who are saying that this whole thing is a charade. let's back up, chris. this crisis didn't need to happen, number one. number two, now that the president allowed this crisis to evolve if they can hold the debt ceiling where it is, make the hard cuts like the congressman talked about earlier, and then continue to re-establish some confidence in what the they are doing. the problem is, it is all political posturing. this they do not need to raise the debt ceiling. pay the things necessary. pay the interest on the debt. take care of the military families. send out the social security checks. that will work. what the president and democrats don't want to do is to then make the cuts on whatever is left.

>> chris: let's talk about whatever is left. and i mentioned this with the two congressmen. the bipartisan policy center, this was an analysis done by a fellow named jay powell who was a top treasury official under bush 41. he did an analysis and found you can do that. you can pay the bo bond holder. what is left you is to cut other government programs by 4%. that is almost -- about 44%. that is almost half. you have to choose between veteran's benefits or unemployment benefits. military pay or closing the fbi and the faa. >> not necessarily. those are scare tactics, chris. what about money that we spend on nonessentials? what about -- >> chris: there isn't 44% of that? >> not if you are going to try to do it straight down. you have to take program by program and find that money.

some agencies you might needed to cut 60%. some agencies you might need to cut 30%. the same part across the board, no, that is not how you get there. take agencicy by agency by agency and look for the cuts and some will be bigger than 40%. >> chris: since we last talked you have put out an economic plan that you say will put america back to work and based primarily, there are other things like cutting regulations but based primarily by lower taxes. lower the top individual and corporate tax rate to 25%. no taxes on capital gains. let me ask you about this. you talk about doing something about the debt. eliminating capital gains taxes would add $1 trillion to our deficit over the next decade. that is how much we take in in capital gains. >> that is static analysis, chris. that is where that $1 trillion comes from. if you do the analysis, it does not add $1 trillion.

the capital gains tax is a wall between people with money and people with ideas. ideas create new businesses. new businesses create jobs because small businesses produce most of them. let me make one other point about this. the engine to our economic growth is the business sector. this administration has put nothing in the encontinue and everything in the caboose. we are never going to grow until we lower the tax rates and remove the capital gains barrier and suspend taxes on repatriated profits. this is why the economy is stuck and stalled. >> chris: warren buffett likes to say he pays a lower tax rate than his secretary. he is paying 15% while his secretary is paying an income tax rate. what about the issue of tax fairness? i mean the people who are going to benefit primarily if you reduce capital gains tax rate

to zero, are wealthy people. >> no, it is small businesses. remember, small business people are organized at sub chapter s corporations. there are more of them than there are warren buffett. i don't care about warren buffett's tax rate. i care about the small businesses that if they eek out a profit in the business it goes through the personal income and if they invest it and get gain on the capital they will be double taxed. that is the groups primarily affected. the whole thing about warren buffett's tax rate is playing the class war fare card. the whole thing about talking about people flying around in corporate jets is just class warfare. i'm concerned about the 15 billion people who do not have a job and not going to get jobs with more government spending. they are only going to get jobs when the business sector, the engine starts to grow again. you have to add certainty to what is going to happen in the future before businessmen and

business women start to grow this economy. >> chris: you said this week that you oppose construction of a new mosque in murfreesboro, tennessee, which is close to nashville. >> yes. >> chris: they have operated muslim worshipers at another site there for more than 20 years. what is your objection to their building a new mosque? >> one of my guiding principles, chris, is that if you want to know the solution to the problem or understand the problem, go to the source closest to the problem. i talked to the people in that community and here is their problem and i sympathize with them. our constitution guarantees separation of church and state. islam combines church and state. they are using the church part of our first amendment to infuse their mosque in that community and the people in the community do not like it. they disagree with it. sharia law is what they are trying to infuse into our. >> chris: did you saying that we should ban all muslims from

worshiping in this country 12346789. >> no, i did not say that chris. what i'm saying is that american laws and american courts that is what the people of murfreesboro are saying. >> chris: but the mosque isn't going to -- >> chris: , i. >> chris, i happen to also know it is not just about a religious mosque. there are other things going on based on talking to the people closest to the problem. it is not just a mosque for religious purposes. this is what the people are objecting to. >> chris: they held a couple of rallies in 2009 and last year to support the palestinians including hamas in gaza. this has gone to a county judge who says the people -- he says that it may be a question about the open meetings rule but he said that the people who have brought suit to try to stop the mosque haven't been heard and that they have a right to build a mosque. i mean my question i guess is, this isn't ground zero in new york city. it is not hallowed ground.

don't americans have a right of whatever religion under the constitution which you speak so much about to free speech and freedom to worship. >> to the people in murfreesboro it is hallow ground. they are objecting to the intentions of trying to get sharia law. the judge may have ruled but this case isn't over with yet. i believe it will go all the way to the supreme court. it is not hallow ground. it is hallow ground for the people in murfreesboro. >> chris: couldn't any community say we don't want a mosque in our community? >> they could say that. chris, let's go back to the fundamental issue that the people are saying that they are objecting to. they are objecting to the fact that islam is both a religion and a set of laws. sharia law. that is the difference between any one of our other traditional religions where it is just about religious purposes. the people in the community know best and i happen to side with the people in the community. >> chris: you are saying any community if they want to ban a

mosque. >> yes, they have the right to do that. that is not discriminating based upon religion, against their particular religion. there is an aspect of them building that mosque that doesn't get talked about and the people in the community know what it is and they are talking about it. >> chris: i don't want to beat a dead horse about one mosque but i want to ask you one more question and it we will move on. this gets back to an earlier controversy where as you know you said you are not comfortable with the idea of appointing a muslim to your cabinet. as someone who i'm sure faced prejudice growing up. >> yes. >> chris: in the '50s and the '60s, how do you respond to those who say you are doing the same thing? >> i tell them that is absolutely not true because it is absolutely totally different. i grew up like you said in the '50s and the '60s, i grew up before the civil rights, during the civil rights movement and after the civil rights movement. i went in corporate america when the openness to putting

blacks in corporate america -- we had laws restricting people because of their color and their color only. >> chris: aren't you willing to restrict people because of their religion. >> i'm willing to take a harder look at people that might be terrorists, that is what i'm saying. i know there is a peaceful group of muslims in this country. god bless them and they are free to worship. i have no problem with that. i never discrim nateed against anybody because of religion or sex or anything like that. i'm going to err on the side of caution rather than on the side of carelessness. >> chris: 2012. in the last month, forgive me for saying thi saying this it t michele bachmann has taken much of your support among tea parties and social conservatives. let's take the poll of likely, iowa caucus goers.

she leads and you are back at 1% in the poll. has she eclipsed you and why should someone pick you over bachman? what is the choice between you and bachman? >> the choice is real simple. my entire career has been problem solving, not politics. that poll may not reflect it but the numbers that we have gotten in our first report reflect a little bit different story. secondly, if you look at the latest gallup poll in terms of positive intensity, i lead all candidates in terms of positive intensity. second little, within the last six weeks my name i.d. has gone from 21% to 48%. >> chris: versus bachman, are you different on the issues? >> we are close on the issues. we are different on the fact that i have more direct hands on problem solving experience. that is where we differ. issue wise we are very close and i said that before. the difference is my entire career as a problem solver and

business executive at pillsbury, burger king, the problem solving approach is where i have stronger credentials than literally many of the other candidates. >> chris: let me ask you a question and we get to the bottom line. four years ago, sam brownbeck finished third in the ames straw poll and felt after all his campaigning he had to drop out, finishing third. don't you have to finish at least that well in iowa? >> i believe we will finish in the top three so i would agree. >> chris: and if you don't, would you you drop out? >> not going to drop out and here is why. the nomination process doesn't stop with the early caucuses only. there are a lot of other states on the back end of the process that could swing it from what it starts out. no, that is not necessarily going to be a determining factor. the biggest determining factor as to whether i stay in or drop out won't be whether i finish first, second or third or fourth, it will be the number of supporters we are getting

and what we are hearing from the people out in the states. >> chris: we have run out of time. i want to plug the fact that you have a new album. >> it has been out since 1996. >> chris: reissued called sunday morning. we are not going to have time to play it but we have been listening to it hear on the "fox news sunday" set. it is wonderful. even a song called sunday morning. mr. cain, thank you so much for coming in today. safe travels on the campaign trail and we will see you for the big, iowa debate. >> i'll be there. >> chris: good. >> coming up, the sunday panel on the debt ceiling crisis and whether next week will bring a grand bargain, cut, cap and balance or a fallback plan. back with the sunday panel, in a moment.

the problem is members of

congress are dug in idealogically into various positions because they boxed themselves in with previous statements. >> we asked the president to lead. we asked him to put forward a plan. not a speech. a real plan. and he hasn't. we will. >> chris: president obama and speaker of the house john boehner continuing to point fingers over who is to blame for the current debt ceiling stalemate. time for the sunday group, bill kristol of the weekly standard. john podesta head of the center for american progress. liz cheney from keep america safe and fox news political analyst, juan williams. house and senate republicans are separately going to be pushing for votes this week related to a balanced budget amendment. i understand that it appears to their base and jim jordan certainly makes an impassioned argument as to why it is the right policy. shouldn't they have been doing this months ago rather than

waiting for the final two weeks? >> i think it would have been better if house republicans pushed cut, cap and balance a month ago. i'm extremely sympathetic to the dislike of giving the federal government more money. no one has a proposal to cut $1.4 trillion right away which is what you have to do. i think it is very important on tuesday that they will now pass a debt ceiling increase with spending cuts and spending caps and a balanced budget amendment added to it. it can no longer be said that the house republicans have their heads in the sand. they have passed the debt ceiling increase and then it is incumbent upon the democrats and president obama to say what version are you for? dense the spending cuts? against the spending caps? against the balanced budget amendment? >> chris: and gets us to the big republican argument about the democrats and especially this president why is that he keeps talking about a big deal

and talks with a lot of specificity about revenue increases he is fuzzy about spending cuts, especially entitlement cuts. why? >> i think he put a frame work on the table as chris van hollen said that includes restraint in discretionary spending on the domestic and defense side. put forth $100 billion of cuts in healthcare programs in the plan he put forward. i don't think he has been -- and i think he has gone even further in his discussions with speaker boehner. i don't think he has been nonspecific in the areas. >> chris: he was asked at the news conference, let me just ask the question. he was asked at the new yous conference what entitlement reforms would you make and he would only mention one which is means testing for medicare. >> and he has specific cuts in the budget with respect to both medicaid and medicare which are more i think -- remember, the republicans ran against the cuts in medicare and then

flipped around and said now we have got to privatize the system and go to a voucher system and take $1.4 trillion out of medicaid. i think he has been specific. there is a negotiation. i think what we are doing now is just running the clock and wasting time and that is -- and that is tragic, i think. >> liz? >> i think that if you want to look at who is really serious about spending cuts look at the two budgets. the president's 2012 budget includes an additional over $7 trillion added to national debt. the republican budget passed by the house cuts spending by $6 trillion. at this point you have a president who will not put a plan on the table. what he wants to do is demagogue. the republicans saying we have got to have spending cuts here. i have been watching this debate from wyoming. from wyoming is looks an awful lot like politicians in this town who want to kick the can down the road. a group of republicans particularly in the house and some in the senate like jim jordan who are saying no, we have got a freight train of

debt that is hurdling down the tracks toward us and the only responsible thing we can do here is get spending under control. >> chris: you have got divided government. the democrats controlling the white house and the senate. republicans controlling the house. eventually any negotiation people have to be willing to give. >> the republicans and the democrats both need -- we got to be able to raise the debt ceiling. we cannot leave it where it is. given that, though, the president and the democrats have got to understand that people are not willing to vote for h that increase without significant change in terms of our spending. significant cuts in spending. >> chris: but let me ask you this question. i'm sorry, juan, i will get to you in a second. i understand the republican argument that all of the cuts that the president talks about are fuzzy. if you could get $3 in spending cuts for $1 in revenue increases would you make that deal? >> if i was voting, absolutely not. because revenue increases, tax increases which the president wants and i think is important

to distinguish, tax increases right now are going to be job killers. they are going to lead to slowing the already very sluggish economic growth. the president himself acknowledged in 2009 yo 2009 yt raise taxes in the middle of an economic downturn. the businesses looking ahead they will know they will have massive increases in taxes because of obama care and massive regulations and new taxes in 2013. they are not going to hire or invest. we have to cut spending. taxes are not the issue here and the republicans are right to say absolutely not mr. president. we want a dollar of spending cuts for every dollar of increase. >> i'm amazed at the number of republicans who will say it is an arbitrary deadline being sent by the treasury secretary despite what we heard from standard and poors anded

moodies and ben bernanke. with regard to tax hikes if this was about taxes we would see interest rates already high in this country. interest rates are at a historic low at the moment. that is not the problem. for $3 in cuts which is what republicans said they want. someone saying let's have the super rich share some of the responsibility and still republicans say no. it lacks the element that i think is so kiwi i key, which t reasonableness. enough with the political posturing. bill kristol talks about now they will have a package on the floor. the vote is so symbolic and empty. >> chris: bill, i mean, look, we have heard all of these arguments. it is 16 days and counting. where do you get a deal? >> you don't get a deal, i don't think. and i'm against all of the closed door negotiations. let people put their cards on the table. internet not have this horrible poker game that is going on

with -- let's not have this horrible poker game going on with liar's poker and all of that stuff. the house of representatives is going to pass legislation tuesday. that is different from speeches and closed door negotiations. let the democrats respond. >> chris: where does that get us if it is not going to pass the senate? >> how do we know? have the majority leader bring it up. if democrats don't like parts let them offer amendments or alternate legislation. >> he is the president of the united states and he has no proposele. there is no pro posal on the floor right now to deal with this problem. the house republicans to their credit are going to pass actual legislation that will raise the debt ceiling and cut spending. >> chris: i have to break in here. when we come back, in addition to talking about this we will focus on the political impact as the debate over the debt ceiling may have on the 2012 presidential race. we'll be right back. you go next if you had a

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whoever the republican nominee it, you know, we going to have a big serious debate about what we believe is the right way to guide america forward and to win the future. and i'm confident that i will win that debate. >> chris: president obama acknowledging the current debate over the country's debt and size and scope of government will be one of the big issues in the presidential race next year. we are back now with the panel. white house officials do seem genuinely confident like the president said that they are winning the argument at this point, at least politically. they say the president is the

one who comes off as he wants a big deal, he is the one who comes off that he wants a balance which if you believe the polls is what most people want between spending cuts and at least some revenue increases. bill, are they right to feel -- forget the substance, are they right to feel good about their position? >> there is no empeericcal evidence that is helping the president. look at the different polls, the president's approval rating drifted down over the last two, three, four weeks. in the last gallup he had a higher disapproval than approval in a matchup against the generic republican candidates he loses now by five points. 7 was the biggest margin in gallup which he has been losing. i think inside the beltway everyone thinks obama is out maneuvering the republicans. the truth is the longer we have a debate about debt and deficit and the magnitude about president obama's spending and failure of the stimulus and the failure of his big spending programs, i think the hurts the president and i don't think republicans need to shy away

from the debate. >> there is not one of the republicans running who beats president obama head to head so that whole business about generic. that is like harry potter running against luke skywalker. there is no reality to it. >> chris: potter skywalker. that would be a hard choice. >> against voldemort. >> it i overwhelming and the president said even republicans would go on some type of tax hikes on the superrich to get a deal and avoid this calamity. >> chris: he was elected, first of all, to fix the economy which we would all agree he hasn't done. secondly, we were told he was the one that was going to end the partisan rancoa and make it work. doesn't that hurt him and one of the reasons people voted for him is he was going to fix the system. >> there is no evidence that he is not working toward a deal. he is willing to compromise. he is willing to say there is

too much spending in this town, let's have substantial cuts. eric cantor has said they had in terms of the biden negotiations, two trillion dollars on the table but eric cantor wasn't willing to say there was some revenue increase to go along with it. >> this president out of step. he does not fundamentally believe that the private sector creates jobs. three examples in the press conferences this week. at no time did he say the words private sector. he believes more government growth and have the government hire people. in the second press conference or first press conference he said that really he doesn't think that he ought to be able to keep more than he needs from the government. this notion that the government decide hass the american people need and ought to be able to keep is not a recipe for economic health. it certainly isn't capitalism.

he said he wants to increase taxes and get through the initial crisis to spend more and infrastructure. this is an insatiable appetite for spending. irresponsible. >> i think that is just so fundamentally wrong on the facts. president obama has proposed taking the domestic government down to the size that it was in the eisenhower administration. that is in his budget. we have taxes now lower than they have ever been since 1950 and have had. >> chris: a lot of that has to do with the fact that we are in a recession. >> but the bush tax cuts contributed substantially to that. you know, particularly for the high end. what are the republicans proposing? go even further than that. now, we are in a hostage taking situation on the debt limit that will be catastrophic if we actually do go over that august 2 deadline. i actually think this is the craziest hostage takeing that we have seen since al pacino

and john were in dog day afternoon. >> that is our second movie reference. >> we like movies around here, right, chris? i think they have got to come to grips with the fact that it would be catastrophic as ronald reagan has said in 1983 as s&p and moody's has said and ben bernanke has said, if we don't raise the debt limit by august 2 and the 4% in cuts take -- and the 44% in cuts take place it will do nothing but drive the economy into a second recession. maybe that is what the house republican leadership wants which is to damage obama by damaging the economy but i think that the american people see what the framework is right now. >> i was jetting what the president said in -- quoting what the president said in his press conference. he has added more to the debt than all previous presidents combined. all you have got to do it --

>> all you have got to do. >> chris: wait, wait, wait. let her finish. juan, juan. stop it. go ahead. >> the stimulus program did nothing to help it. 9.2% unemployment. you could find $1.2 trillion in savings in you were to repeal obama care. not complicated. about but this president refuses to put obama care on the table. ing. >> every independent analysis -- >> it says. >> chris: wait, wait, wait. >> the bush tax cuts. medicare part d and the two wars. >> the bush tax cuts. you guys keep talking about the bush tax cuts for the super rich. >> chris: here is the question. wait, wait, wait. everybody calm? let's -- what is going to happen? i mean all you are doing is repeating the arguements we have heard and heard and heard. every one of you agrees that we cannot get past august 2 without raising the debt ceiling. we all agree. >> we should not. >> chris: what is going to

happen? >> the republicans will pass on tuesday and then pass the prioritizing of federal ex-pen tithers. if there are a few days or couple of weeks where the debt ceiling goes past august 2. they will also pass i believe next week a short-term increase, maybe a month. $100 trillion. >> chris: which the president says he will veto. >> let him explain that to the american government. the president himself endorsed and he will veto it? why? because it doesn't accord with his decision of what he thinks should happen. >> i don't like it but i think it is probably some version of mcconnell which is a cut that the deficit now by $1.3 trillion or $1.4 trillion. get this passed and get the debt limit passed. the election and then fight it out next year in the election. president obama will bring it and the republicans can answer. >> chris: you have 30 seconds. what is going to happen? >> the president is going to louisiana the election.

>> chris: not november 2. >> i think if the republicans in the house will in fact pass spending cuts along with debt limit of retirement questions.

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>> chris: time for comments you posted to our blog wallace watch with the debt deadline fast approaching. many of you had questions like we did. russ nichols writes if congress does not have a deal by august 2nd will the salaries of washington leaders and staff be suspended along with other payments? one asked... >> chris: and finally anne sent this. >> chris: please keep your comments coming to us at foxnewssunday.com. we want to wish the u.s. women's soccer game all best in the finals. have a great week and we'll see you next fox news sunday.