All-Star Panel: Weighing the ramifications of sequestration

This is a rush transcript from "Special Report," February 21, 2013. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

PRESIDENT BARACK OBAMA: What I say to them is there is no reason they should be furloughed. There is no reason they should lose their job or be laid off. This is a problem that Congress can solve. You know, these automatic spending cuts that were put in to place in 2011 were designed to get Congress actually avoid them by coming together with more sensible approaches to deficit reduction.

(END VIDEO CLIP)

BRET BAIER, ANCHOR: President Obama talking to a local affiliate about the sequester. House Majority Leader Eric Cantor saying, "House Republicans have acted, and it's time for the president and Senate Democrats to join us. It's time to get off the campaign trail, and get to work. Show us what spending reductions you prefer, and let's find some common ground."

So here we go again. You heard interviews in this show earlier trying to press for some answers. Charles, your reaction and we're one day closer?

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: The president says it doesn't have to happen. He is right. All he has to do is say he is prepared to speak to Republicans about shifting accounts. In other words, by having the same amount of cuts by actually, but actually having to make choices, priorities, which is what governing is all about. And that's why you have a budget. X is important so it gets supported. Y is less important it gets cut. He is saying I'm not going to do that.

BAIER: As Gene Sperling said, no off-ramps. I think he said four times –

(CROSSTALK)

KRAUTHAMMER: Yeah. The off-ramp is a negotiation on allowing the money to move around accounts. The one thing that Obama is not facing is the fact that even if all the cuts are enacted, it's one-twentieth of the annual deficit. It's doing absolutely nothing, and still he says it's utterly impossible.

BAIER: Kirsten, we also saw Jennifer Griffin's piece about the impacts in these towns, and they will be felt.

KIRSTEN POWERS, COLUMNIST, NEW YORK POST: There will be huge impacts. And people being laid off is actually a big deal. It's not good for the economy. If you look at the cuts and what happened to the Defense Department alone what that would do to the economy in terms of the unemployment rate is serious. I don't think that anybody has really laid forth any kind of serious plan. The president's plan doesn't talk about entitlement spending at all and continues to load everything onto the Defense Department.

Look, I'm all for, you know, cutting where there can be cutting. But you can't constantly go back to the Defense Department and ask them to be doing as much as they're doing and continue to cut them and pretend like this entire pie does not exist over here that needs to be dealt with.

BAIER: Steve, by the way, that Warn Act thing, we are going to follow up on that, because I think that is a potential problem or trial attorneys may be licking their chops. I'm not sure.

STEVE HAYES, SENIOR WRITER, THE WEEKLY STANDARD: It seemed to catch Gene Sperling a little bit by surprise, I think. He didn't have a ready answer as to how exactly they are going to handle this. I mean it would be almost the perfect coda to this entire episode if it ended with the federal government paying for the lawsuits for federal workers who sued because they had been laid off in an effort to save the government money. It's almost perfect because you have this ill-conceived super committee from the beginning that I thought was doomed to fail. It was a bad idea from the beginning. They couldn't get it to work. So now we have this sequester, which was a bad idea from the beginning. It would be almost the perfect poetic ending if it ended with those --

KRAUTHAMMER: But cuts are a good idea and this is the only chance of having any cuts out of this administration between today and January 2017.

BAIER: So does it happen?

KRAUTHAMMER: Yes.

POWERS: Yes.

HAYES: It happens and then I think it is pulled back in part.

BAIER: That is it for the panel, but stay tuned for recap of Vice President Biden's Facebook Q & A.

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