HANNITY: $1 trillion stimulus. This year's deficit is 1.6.

GOOLSBEE: Over three years!

HANNITY: This year's deficit.

GOOLSBEE: Sean over three years, come on!

HANNITY: Wait a minute. This year's deficit is $1.65 trillion.

GOOLSBEE: And we're trying to get out of the worst downturn of our lifetimes. I mean, look, I'm not disputing.

HANNITY: For three years?

GOOLSBEE: Yes. Three years. Look, Sean, I'm out at this Fed conference where there are all of these international economic officials, from other countries. The consensus of the international arena is that in the data when countries come out of deep financial crises, it is a tough, messy process. Our fastest recoveries like the one under President Reagan come in circumstances where you can just go back to doing what everybody was doing before the recession began. We had a bubble that popped, Sean.

HANNITY: Reagan did the opposite. Reagan dropped the top marginal rates. Obama's pushing from tax to rich, tax to rich.

GOOLSBEE: Obama cut taxes.

HANNITY: He dropped the top marginal rates from 70 to 28 percent.

GOOLSBEE: You are getting the timing all mixed up.

HANNITY: I know, I studied Reagan. He dropped the top marginal rates.

(TALKING OVER EACH OTHER)

GOOLSBEE: The top marginal rate under Ronald Reagan was 50 percent until 1986.

HANNITY: Excuse me, he dropped it from 70 to 28 percent, that was the first bill he passed that lead to 21 million new jobs. He didn't go blaming his predecessor every day.

GOOLSBEE: That wasn't to get out of the recession, Sean.

HANNITY: It did, it worked though.

GOOLSBEE: Here's what I'm saying. We can argue about what happened two-and-a-half years ago for as long as you want. I don't believe that the lack of rules on the financial industry was the cause -- is -- the way to reduce the regulations of financial industry is the way to get the economy going again. I think it was the lack of rules that got us into this mess.

We disagree on that. Let's pick the things we agree on. There are some things we could agree on.

HANNITY: Hang on a second. Before we get there, I want to go back to President Obama in 2008, this is July 3rd, 2008. And I want to hear -- he now has hit the $4 trillion of Obama debt.

GOOLSBEE: That is before the financial crisis.

HANNITY: $4 trillion of new Obama debt. This is what he said in 2008, July 3rd, about George W. Bush and the $4 trillion that Bush accumulated not over two-and-a-half years, but over eight years. Here's what he said.

(BEGIN VIDEO CLIP FROM JULY 3, 2008)

OBAMA: The problem is, is that the way Bush has done it over the last eight years, is to take out a credit card from the Bank of China in the name of our children, driving up our national debt from $5 trillion for the first 42 presidents, number 43 added $4 trillion by his lonesome. So we now have over $9 trillion of debt that we are going to have to payback, $30,000 for every man, woman and child. That's irresponsible. It is unpatriotic.

(END VIDEO CLIP)

HANNITY: Based on his own definition. $4 trillion. He did it in two-and-a-half years.

GOOLSBEE: That was during a boom! That was during a boom! That's exactly the point!

HANNITY: Here's my question. Is he irresponsible?

GOOLSBEE: He is responsible. He is responsible.

HANNITY: Is Obama irresponsible? And is Obama unpatriotic?

GOOLSBEE: No, the Bush numbers that he is citing were during a boom. Obviously, if you go into the worst downturn in your lifetime, I'm surprised you are not giving him credit, Sean.

HANNITY: Giving him credit?

GOOLSBEE: Because at the same time, spending had to go up to deal with the crisis, he's had the lowest taxes as a share of GDP in 60 years.

HANNITY: Because he couldn't get his way, he tried to raise them. He tried to, you know, eliminate the Bush tax cuts.

GOOLSBEE: Sean, he's cut taxes for 150 million workers, the biggest middle class tax cut ever.

HANNITY: All right. Listen, all I can say is. Forget Sean Hannity and I'm a conservative. Look at his numbers on the economy, on the right track, wrong track. Faith in the government to solve the problems. Obama's personal approval ratings this week the lowest in his presidency.

The American people are judging as of this moment that his economic policies have failed. You won't acknowledge that his broken promises on cutting the deficit in half, on eight percent unemployment, on turning the economy around. You are going to say that he's been a success, that he has met his promises?

GOOLSBEE: Look, I'm saying we are laying a foundation for growth. We had a period where we were growing --

HANNITY: When will we see it?