• With: Sen. Mike Lee, R-Utah

    CHRIS COTTER, GUEST HOST: The president wants to go big, so why do the numbers keep going down?

    Welcome, everyone. I’m Chris Cotter, in for Neil Cavuto. And this is "Your World."

    And in moments from now, a new round of debt talks will get under way at the White House. But it’s not all smiles, as you can see it was yesterday, by because the president’s grand plan ain’t looking so grand.

    In a week, we’ve gone from talk of $2 trillion in spending cuts to $1.7 trillion and now getting closer to $1.5 trillion, plus a few more here and there. And there’s no guarantee that number won’t go even lower as these debt talks drag on.

    Utah Republican Senator Mike Lee also thinks we need to go big.

    But, Senator, $1.5 trillion in cuts spread out over 10 years and no talk of lowering the corporate tax rate, is that really going big?

    SEN. MIKE LEE, R-UTAH: No, it’s not going big at all. In fact, I’m not sure it’s going anywhere.

    The problem is that one Congress cannot bind another Congress. So no matter how big the spending cuts are that we’re talking about, if they’re stretched out over a period of 10 years and if they are not accompanied by a constitutional amendment, we have no guarantee that they’ll even be followed.

    COTTER: Well, do you get a sense that both sides now are kind of taking -- each taking a step back to try and get a deal and making the deal small enough that it will be palatable to both sides, because the administration and the Democrats are not make a big deal unless you have big tax increases, and the Republicans want big spending cuts, and neither side is willing to give, so they’ll both take small cuts and small increases?

    LEE: Well, some have suggested that.

    I actually believe that we’re not nearing a deal in that area at all, because at this point the only plan on the table, the only plan that has any significant degree of public support is that found in the Cut, Cap, and Balance act that we filed last week, a week ago today.

    We now have the support of about 35 Senate Republicans. A companion bill is being introduced today or tomorrow in the House of Representatives and we expect a lot of support there as well.

    (CROSSTALK)

    COTTER: Senator, how does that plan work? Because I think people – we’ve heard that term now over the last week quite often, and I’m not sure if everybody out there really understand how it would work.

    LEE: Well, it involves some immediate spending cuts. It takes the domestic discretionary spending for fiscal year 2012 back to 2006 spending levels.

    And then it brings about a series of cuts that on the Senate side at least would result in about $6 trillion worth of cuts over the next 10 years. But the most important feature of it is that it requires passage of a balanced budget amendment to the Constitution as a condition to raising the debt limit at all. And that it’s distinguishing feature. That’s the one that we have to have in order to make this deal work. This plan is growing. It’s the only plan out there right now.

    (CROSSTALK) COTTER: Well, there’s another plan. It’s the McConnell plan. And it seems to be gaining some acceptance on both sides of the aisle. Even earlier today, Dick Durbin-- If we don’t get an agreement today, we will have no choice but to pass a McConnell-type plan after that. Bob Corker--We’ve got to stop this childhood behavior. He talks about -- or he intimated to our own James Rosen earlier in the day that that plan is gaining some support.

    Do you get that sense?

    LEE: Well, that plan has been described by Senator McConnell himself as a backup plan, as a plan B.

    There are a number of us, myself included, who are not willing to consider that plan and will not support it. I’ve pledged from the beginning, in fact since before I even took office, that I will not support any plan that is not accompanied by a constitutional amendment.

    COTTER: Talk to me about what happens on August 2. We certainly have heard the scare tactics by the administration about Social Security checks. Talk to me what happens on that day if we don’t have an agreement to raise the debt ceiling.

    You have a plan that could -- or certainly would enable Social Security checks to be mailed out and some other expenditures by the government to actually be taken care of, don’t you?

    LEE: Oh, that’s right. That’s right. My plan would address the debt limit and it would allow the government to continue to operate, for Social Security checks to continue to be sent out.

    That’s why I find so insulting the president’s unwillingness to go along with this plan. He has yet to describe what it is about the idea of a constitutional amendment that he finds so repugnant. But the president dismissed it out of hand and the very next day said let’s go ahead and just cut all of the Social Security checks going out to current retirees without any explanation as to why they would be the first on the chopping block.

    Look, when we’re bringing in about $200 billion a month and our interest payments are less than 10 percent of that, and Social Security payments are about $50 billion, why on earth would you cut Social Security checks first? That doesn’t make any sense to me and I think it’s insulting to America’s retirees.

    COTTER: And we were just putting on the screen some of those 20 items that you think could be cut and trimmed before you had to dig into the Social Security fund and would have to stop mailing out those checks.

    One final thing for you, Senator. Do you get a sense at all that there’s a split within the GOP because of these negotiations? I know Cantor’s been getting hammered. I talk a lot about some of these other senators that are favoring the McConnell bill. Some like yourself are not favoring it. Do you feel like there is a little bit of a split?

    LEE: Well, look, what I see developing is a growing consensus behind the cut, cap, balance approach.

    And I’m pleased to announce that Senator McConnell himself has signed on as a co-sponsor to the Cut, Cap, Balance Act. So, I think that’s where the consensus is growing. I’m choosing to focus on where there’s agreement, rather than where there might be disagreement.

    COTTER: Senator Lee, thank you so much. We appreciate your time.

    LEE: Thank you.

    COTTER: All right.

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