• With: Tom Donohue, U.S. Chamber of Commerce CEO

    This is a rush transcript from "Your World," November 13, 2012. This copy may not be in its final form and may be updated.

    NEIL CAVUTO, HOST OF "YOUR WORLD": Well, just across the street, I'm talking across the street, but it might as well just have been across the solar system.

    Chamber of Commerce CEO Tom Donohue is not coming to the White House. That's because he wasn't invited to the White House. Lots of big labor guys were today. Lots of -- well, some big company guys were slated for tomorrow, but let's just say Barack not keen on breaking bread with Tom, the guy who represents thousands of small and medium size American companies not in on talks to sort this fiscal mess out.

    Tom, I think that's called a slight.

    TOM DONOHUE, PRESIDENT & CEO, U.S. CHAMBER OF COMMERCE: Well, we're very happy with our opportunity to make our points in all the traditional ways that we have available to us, including talking to you.

    CAVUTO: Well, I appreciate that. And don't you know the president watches this show.

    But do you feel offended? Like, I don't know. I would feel offended.

    DONOHUE: Absolutely not.

    CAVUTO: Yes, you do. Tom, I think you do. You're blocking.

    (CROSSTALK)

    DONOHUE: No, I'm not blocking. I'm working.

    You should see what we did today. We're making progress, we're all over the place, we'll have our say on what will happen here. And the business people who are there tomorrow, almost all of them are big members of our.

    CAVUTO: A lot of the ones going there tomorrow represent -- the GEs and some of these big companies, not a lot of the financial players. We're going to get into that in a second, but it's not a great cross-section of corporate America. What do you make of that?

    DONOHUE: Well, I mean, there are only a few table -- seats around the table in the Roosevelt Room. So they're only going to ask a few of them.

    And many of them are friends of the administration, or they have been involved in this new organization which I applaud, which is working on trying to deal with the debt. And we're working together with them.

    CAVUTO: Well, it seems to be making great progress.

    (CROSSTALK)

    CAVUTO: I think -- in other words, Tom, I don't mean to sound cynical on either what the left is doing, what the right is doing, what the president is doing, what Congress is doing.

    But they are not making progress. So, the same characters come in and meet with the president. And I just had a labor guy here earlier who said the only way around this is just to hike taxes on the rich and don't cut a thing, couldn't even think of anything to cut.

    And these are the first people the president meets with. I'm just thinking to myself, self, this is going nowhere fast.

    DONOHUE: Well, look, is the fundamental issue that we must deal with entitlements. Because in very few years, with 10,000 people a day retiring and the death age extending way out, we will consume all of our national revenue to take care of Medicare and Medicaid.

    And I think it's very important for us to deal with that, to deal with a reasonable restructuring of national tax, and most of all to add a third bucket, and that is energy. Energy is what Canada used to build -- rebuild their economy.

    And we have lots of it. We already have a million, 750,000 people working around in the states in the innovative ways and non-structured ways to take oil and gas out of the ground. We are in a position that we can expand that tremendously, hire millions of people, pay royalties and pay taxes and help deal with the debt and deficit.

    CAVUTO: You think the president is moving in that direction? Because his language says one thing. His -- who he meets with and what he tells them after he meets with them says quite another.

    He talks about an overture and working with Republicans, but then threatens a veto on anything that avoids hiking taxes on the rich. So I see same old, same old, same old. When it comes to energy, I hear a lot of solar; I hear a lot of wind. I don't hear a lot of the things that you're talking about.

    DONOHUE: Yeah, talk to the governors.

    But the bottom line here is when we get down to actually doing the big deal and counting up the real money, we're going to need additional funds from a third source, unless we want to dip into entitlements and defense and to taxes in a way that will severely hurt our economy.

    And I believe that we'll build a coalition of people next year that will come together to get some or most of that done. We should be very careful not to go over the cliff at the 1st of the year, because we will have a negative effect on this economy and on employment. And we'll hurt Europe and other places that are our major sources of export.

    CAVUTO: Well, you might see it that way. And you're pretty good at this business stuff. But apparently the treasury secretary of the United States does not.

    He's at this Wall Street Journal conference going on right now in which he said it would not be good policy to extend all U.S. tax breaks beyond December 31. Obviously, he's talking about going full throttle to hike taxes on the wealthy, essentially come hell or high water.

    Will that be damaging? What do you see?

    DONOHUE: Well, I think it would be a big mistake, because if you deal with taxes in a partial way before we go to do the big deal, it will make the big deal a lot harder.

    And, besides -- I know this sounds hard for you to understand, but it's a very small amount of money in terms of the deficit we're going to run in 10 years. And we ought to deploy it in a more effective way that will create jobs and will allow us to do a serious restructure of our corporate taxes.

    CAVUTO: Yes, but that assumes that whatever deal or concession you make now to get that is returned, in other words, a promise is delivered.

    And I see that maybe post the election, a lot of Republicans running with their tail between their legs and they're just – they're caving on everything. And there certainly is something about negotiating and understanding that the president did win this one. And he's entitled to certain things, but he is not entitled to everything.

    DONOHUE: He won by 2 percent.

    CAVUTO: I hear you.

    (CROSSTALK)

    CAVUTO: Are you afraid that businesses' interests will not be represented then?