• With: Newt Gingrich

    This is a rush transcript from "On the Record," June 28, 2011. This copy may not be in its final form and may be updated.

    (BEGIN VIDEO CLIP)

    Footage of shouting and protests in Athens, Greece

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    GRETA VAN SUSTEREN, FOX NEWS HOST: That's Athens, Greece. Violence is seizing that city. Protesters hitting the streets, enraged about the potential of new austerity measures. It's no secret is in trouble. It's government is trying to find its way out of a catastrophic meltdown resulting from the staggering national debt.

    And what is happening in Greece is striking a nerve here in the United States? How about our own debt? Joining us Republican presidential contender and author of the brand new book "A Nation like No Other," former Speaker of the House, Newt Gingrich.

    Mr. Speaker, nice to see you. We see what going on in Greece now about these new austerity measures that may go into effect. Any chance the United States is remotely heading into the direction Greece is?

    NEWT GINGRICH, GOP PRESIDENTIAL CANDIDATE: A chance we are headed towards the huge financial problem. They are professional anarchists who want to create violence. The best thing the police there can do is lock them up. These are people who want violence.

    There were several thousand peaceful protesters more like what happened in Madison, Wisconsin here. Those were folks representing government unions didn't want to see their contracts changed. The real violence is caused by people out to create violence. It's nothing about the meltdown.

    The problem the Greeks have and the problem we have is that politicians have promised more than they can deliver. People like the promises. When you start saying we're going to have to change it people start counting up what they are going to lose.

    In Greece they are in so much trouble they could lose one-third of their total value. If you are somebody who has been working all your life, could you lose a third of everything you saved your whole lifetime. And it's combined with real anger at Germany, which occupied Greece in World War II. You have a combination of nationalism and real economic fear coming to the. I think it is going to be a mess and it is going to stay a mess for a long time.

    VAN SUSTEREN: Here in the United States the president is meeting with leaders on Capitol Hill. Republicans say no to tax increases. Democrats are not going as far as spending cuts Republicans want. So there's a line drawn in the sand, do you agree?

    GINGRICH: I think the line has been drawn. On the Democratic side it is a silly line.

    VAN SUSTEREN: I would expect you to say that about the Democrats, because it is the other party.

    GINGRICH: Republicans ought to say we'll accept the cuts the Democrats have offered, whatever that number and we'll raise the debt ceiling the amount the Democrats are prepared to cut. That might be three months, two months, whatever. Let the Democrats decide how long the debt ceiling is going to last by the amount they are willing to cut. With 14 million people unemployed, to have a tax increase to further weaken the economy is truly socialist economics. It makes no sense at all in this country to raise taxes right now.

    VAN SUSTEREN: If you were still speaker or president that would be your line. Under no circumstances taxes being raised, correct?

    GINGRICH: My line would be we ought to have dramatic economic growth package and get people back to work because nothing will do more to balance the budget than getting people to work.

    VAN SUSTEREN: If that is your position and if the Democrats are unwilling to change their position, and that's as far as we get in terms of -- both sides will say you have compromised, the fact is nobody is moving any closer, what would happen?

    GINGRICH: I think the House Republicans should pass the package the Democrats have offered on spending side. Democrats can decide if they want to obstruct or not and the president can decide if he wants to sign it.

    VAN SUSTEREN: What do you think will happen?

    GINGRICH: If the Republicans are calm and cheerful, the president will sign a spending cut only bill.

    VAN SUSTEREN: You think the Republicans will not budge on the tax cuts and the Democrats will move closer to the Republicans' position?

    GINGRICH: Democrats are faced with a real crisis. The president is about to preside over the United States defaulting on its debt. He can't do that. So he is going to have to in the end agree to something. The Republicans are in a position to say they are very happy to avoid a default if he will sign a spending cut bill.

    VAN SUSTEREN: I think what the Democrats will say, they are going to say the Republicans just want the rich to have all the money and they are willing to put the country in default to do that.

    GINGRICH: Right. If you are the Republicans you should say we have more people on food stamps today than ever before in history. President Obama is the most successful food stamp president in American history. We need a program to put 14 million Americans back to work. We are committed to creating jobs. The Democrats are committed to killing jobs. You decide which future you want, paychecks or food stamps?

    Republicans shouldn't flinch because Democrats yell class warfare. Republicans shouldn't blink and run for the hills. They ought to be calm and say this is the Obama depression it is going to get worse under his policies and we ought to change it now.

    VAN SUSTEREN: The thing that always bothers me is that there's talk about whether to raise taxes, not raise taxes, spending cuts, but there seems to be little talk about waste and fraud and improper payments.

    I have a copy of improper payments by the federal government. The numbers are staggering for last year. Department of Health and Human Services Medicare fee for service, %34.3 billion improper payments. Medicine -- Medicaid $22.5 billion dollars, unemployment insurance department of labor overpayment $17.5 billion, billions and billions of dollars. That seems like it would be so politically attractive that any party would seize upon an opportunity to do that.

    GINGRICH: I think it is frankly mystifying. At the center for health transformation a couple years ago we published a book called "Stop buy paying the crooks." We thought that title would be catchy enough that Washington pay attention. We believe the total amount of fraud and theft in Medicare and Medicaid is $720 billion a year.

    VAN SUSTEREN: But why?

    GINGRICH: I can't tell you. IBM and dell and other high-tech companies have offered to show how to save 125 billion dollars a year. American express, IBM and Visa have offered to show most of the fraud, in Medicare and Medicaid.

    You cannot get either the Congress or the president who slow down and look at better management. It is either do you want more or less? I would like a lot less theft. It is very hard to get them to pay attention. You raised the right point. There are potentially a trillion dollars or more sitting on table in savings over the next 10 years if we would have a serious initiative on managing the federal government.

    VAN SUSTEREN: Mr. Speaker we are going to take a quick break. I hope you'll stay with us.

    (COMMERCIAL BREAK)

    (NEWS BREAK)

    VAN SUSTEREN: Breaking news in Afghanistan, a deadly, savage attack by the Taliban at a Kabul hotel. A dozen people murdered at a place where many guests are Americans and journalists. They seized the hotel dressed in civilian clothes and stormed inside. Right now the United States is sending more troops to the hotel.

    Newt Gingrich is back with us. What do you think about that?

    GINGRICH: I think we are drifting to a very, very dangerous situation. None of the generals recommended the speed of the drawdown the president wants. We are beginning to lose in the region.

    You just had a meeting this week in Iran the president of Pakistan and Afghanistan to Iran to sit down with Ahmadinejad, the dictator of Iran. That has to be seen as an insult in the United States. Iranians just got elected vice president of the general assembly.