• With: Rep. Tim Huelskamp, Rep. Charlie Rangel

    This is a rush transcript from "Your World," December 31, 2012. This copy may not be in its final form and may be updated.

    LORI ROTHMAN, GUEST HOST: Reports a deal will hike taxes on people making more than $400,000 a year. But if the House didn't OK a plan to hike taxes on millionaires, how would this plan pass?

    We go now to Republican Congressman from Kansas Tim Huelskamp.

    Congressman, thank you so much for joining us.

    What is your take on where we stand now, the framework of the deal here? The talk, at least today, was that this threshold being lowered tax hikes to families earning more than $450,000 a year. You didn't like a million dollars in plan B. What do you think of this new number?

    REP. TIM HUELSKAMP, R-KAN.: Well, Lori, I am still looking for any study or any person that says raising taxes is going to...

    ROTHMAN: Yes.

    HUELSKAMP: ... is going to create jobs.

    We think this might impact a million small businesses paying more in taxes, and -- but that is a position most Republicans -- we do not want to raise taxes. But I fear a deal with no spending cuts, no entitlement reform, and raising taxes. It looks like three strikes you are out, and not a good deal and certainly not a solution to our problems.

    ROTHMAN: We have known for months now the Congressional office -- Budget Office predicting that if we do go over the cliff it will send the economy, the domestic economy, back into a recession.

    And we are hearing now that the House will not vote on anything tonight because there is nothing to vote on, despite all the work done today and over the weekend, nothing for the House to vote on, which begs the question, if we go over the cliff, which it appears likely here, with the New Year's Eve ball dropping just hours away, what next?

    HUELSKAMP: Well, it looks like the IRS has postponed the withholding tables, so we have a few more days.

    But the Senate has not passed a budget in 1,341 days. And I didn't expect them to work very quickly today, but hopefully they will put something out that actually includes spending cuts, because that is the problem here.

    And not only did we have the fiscal cliff. We had the debt ceiling that we're going to push through and blown through an enormous amount of spending since the last debt deal. And, again, that remains a problem and any deal that ignores spending is no real solution and actually just punts and makes it more difficult down the road.

    ROTHMAN: How do you get leverage by negotiating around the debt ceiling? Because, as you know, it is the second time in, what, two years that we have blown past the ceiling, yet no one seems to care. There is no leverage there. There is no leverage footing.

    HUELSKAMP: Well, I -- well, the -- the bad debt deal, 17 months ago, created much of the situation today.

    And in a couple of months ago, we will face that again. But I certainly hope -- I think the last thing Republicans want to do is have anything around the debt ceiling inside this potential deal. But again we don't have any details. We will hopefully hear those in the next couple of hours and get some final, final details out to us.

    But again it looks like three strikes going the wrong direction and that is frankly what most of my constituents feared Washington would do, is ignore the real problems and say they have solved it and go home for the New Year's. And that -- again, that doesn't solve the spending problem here in our nation's capital.

    ROTHMAN: All right, Congressman, we appreciate your take. Thank you.

    HUELSKAMP: Thank you, Lori.

    ROTHMAN: OK, hours to go before the new year, the market may be closed. Markets rallied 166 points today, but again there are hours to go.

    To Democratic Congressman from New York Charlie Rangel now with his take on things.

    It looks like taxes are going up for the higher earners, some would argue, Congressman, yet the sequestration, if that also goes in effect, that could do some serious economic damage, especially in defense industry and jobs there.

    REP. CHARLES RANGEL, D-N.Y.: It is amazing how people have such little confidence in government.

    Just when people say that we have an outline and it looks like we are close to a deal, people are happy. The fact is that we don't know whether we have a deal or not. But if in fact -- if the White House and the Senate can leak out information to the press that we are close to it, let's accept that.

    The sequestration is a problem that we created and it's one that we can move on and deal with at another time. And I hope this will be the case. But right now, I think people want to see their government work together.

    And if we have that type of attitude, instead of one of confrontation, there is no problem before us that collectively we cannot resolve.

    ROTHMAN: But, Congressman Rangel, something I want to key in on with you, this confidence in government, why should Americans be confident in Congress, in you, when we have been down this road before, the debt ceiling fight of a year-and-a-half ago?

    And it is just totally dysfunctional. We cannot get to a deal, we can't get to a compromise. It is one cliff after the other, it seems.

    RANGEL: Come on now. You're Fox. You have to be fair and balanced.

    We are just bringing good news that we are already there, and you are saying, what if, what if? You are probably right. These are problems that we are going to have to face. But right now, we have a...

    (CROSSTALK)

    ROTHMAN: You think we are almost there, but Senator John McCain is throwing his hands up, saying there's no deal, there's no vote, there's...

    (CROSSTALK)

    RANGEL: Senator John McCain and I are in the same position. We're outside of the loop. We are not involved in the negotiation.

    And we had some good news just a few minutes ago that we probably are close to resolution, a temporary resolution of the problem. This is not the time for us to be complaining about problems that are going to be down the road.

    ROTHMAN: But a temporary resolution is not a resolution. And down the road -- the kicking the can phrase is like the banned phrase for the new year because we have overused it so many times.

    We can we just put the period on this and move on?

    RANGEL: One thing that we want is that some...