(BEGIN VIDEO CLIP, AMERICANS UNITED FOR CHANGE AD)
NARRATOR: The Republicans in Congress are driving us towards the edge of a cliff, recklessly risking default, recklessly risking jobs and the American economy. They’re willing to risk it all to protect tax breaks for millionaires, oil companies, and CEOs who fly around in corporate jets, even if the rest of us crash and burn.
(END VIDEO CLIP)
NEIL CAVUTO, HOST OF "YOUR WORLD": All righty, what is it with cliffs? I’m gone just a couple of weeks, and nothing changes. Over the cliff and now over-the- top.
Welcome, everybody. I’m Neil Cavuto.
And my thanks first to my colleagues and friends Stuart Varney and Chris Cotter for doing such great work when I was out these last couple of weeks.
You know it amazes me, though, that despite all the news that I missed, the one thing I did not -- actually two things -- the fear-mongering and the "driving us off the cliff" thing.
In this latest ad out today from the Service Workers Union and a liberal group called Americans United For Change, no change, same old thing: Republicans are recklessly risking defaulting on our debt and driving our economy right off the cliff. Off the charts. What is it with the liberals and cliffs?
Remember the one showing a guy looking an awful lot like Paul Ryan pushing a granny looking an awful lot like the late Harvey Korman off a cliff with Medicare cuts that were over-the-top?
Look, I’ve been out for a couple of weeks, as I said, but it does seem to me that many liberals are just out to lunch, refusing to see that policies as they are the ones driving this country off the cliff.
Now, it’s not adjusting government spending that’s pushing us over the edge. It’s refusing to even address that spending. We’re all going over the cliff because we’re all out of money and on the left apparently out of ideas as well. That’s what is so crazy here, attacking anyone then who has the guts to say it is time to change things, because the risk of careening out of control is alive and well, my friends.
We have been perilously speeding along this dangerous highway for decades now. So I think it’s time we kind of all wake up now, because every time we raise the debt limit and ignore what got us into raising the debt limit, we kind of hit our limit. And, me, well, I just hit the wall.
Take it from someone who’s been missing work. These guys are just a piece of work.
To South Carolina Republican Senator Jim DeMint, who’s at the center of this fight and being criticized by many in his own party for being at the center of this fight and not accepting business as usual, something he points out quite exquisitely in "The Great American Awakening," his big bestseller on this very subject.
By the way, we did try to get someone from the SEIU to respond to this ad, so far, no response, but hope springs eternal. Senator, good to have you.
SEN. JIM DEMINT, R-S.C.: Neil.
CAVUTO: First off, sir, on the news of the day and whether we are closer to a deal or not, what are you hearing?
DEMINT: Well, Neil, there is a bill that has passed the House, as you know, the ‘Cut, Cap and Balance’ bill. It’s very common sense. Let’s cut some spending now, let’s cap it over 10 years, let’s try to move towards a balanced budget, and let the American people decide if we should balance our budget once and for all.
That bill will come to the Senate this weekend. The Democrats are threatening a filibuster, but all we’re asking for is debate and amendments. It’s the only bill here that has a chance to pass before the August 2 deadline. The president hasn’t given us a bill. The Democrats in the Senate haven’t.
But I’m very thankful for the leadership of John Boehner and the House Republicans. They passed a bill overwhelmingly. I think every Republican supports it in the Senate. We might even have a majority because I think a few Democrats are willing to let us proceed to a debate.
But the president I believe is really panicking. And the Democrats, the liberals think the Americans are stupid and that they can run these ads, but the only responsible party in Washington right now is the Republican Party. We’ve given him the increase that he asked for.
Standard & Poor’s and Moody’s will recognize this as meeting their criteria so they won’t downgrade our bonds. So Republicans have done all we can. We only control the House of the Representatives. And...
CAVUTO: No, I know that. And you might argue otherwise that it’s possible to pass this in the Senate when the vote comes up on Saturday. Everyone else I talk to says that is unlikely given just the makeup of the Senate. But you’re right. You could pick off some Democrats.
DEMINT: Well, Neil, we are not trying to pass it. We’re just asking for an open public debate on the bill for a couple of days.
CAVUTO: No, I understand, but to me it looks hopeless.
So, what I’m asking you, Senator, is whether you see any movement toward a deal that would be specifically to your liking?
DEMINT: Well, there is no deal. Tom Coburn said at our press conference for ‘Cut, Cap, and Balance’ today that the ‘Gang of Six’ proposal has no chance of being part of the debt limit debate. The McConnell-Reid deal is not going anywhere. If it gets out of the Senate, it’s not going anywhere in the House. Speaker Boehner has said today that the ‘Cut, Cap, Balance’ bill is the bill that we need to be amending, debating. We need to be talking about it. It’s the only core bill that we have. So there’s no other bill.
CAVUTO: All right.
DEMINT: If the president wants to take us beyond August the 2nd, then he can continue to dismiss this bill, but I frankly think that they’re starting to get some calls that Americans really think -- over 70 percent believe we need to balance our budget. So this is right in line with where I think America wants us to be.
CAVUTO: Now, you mentioned S&P, the ratings agency that has had this planned powwow with Republicans today. It was going to be first House Republican freshman. Then I guess they extended to Republicans, period. Who called for that meeting?
DEMINT: I’m not sure. I suspect -- well, of course Paul Ryan’s been very involved with the numbers here, Jim Jordan, who runs the Republican Study Committee. We’ve got a lot of new leaders in the House.
And I know they’re trying to do this the right way. I know the media’s trying to dismiss it. But this is a very responsible, well-written bill. They’ve compromised with the president by giving him the debt limit and all they’re asking for is some reasonable cuts similar to what Moody’s and Standard & Poor’s are asking us to do.
So this is not a partisan bill.
CAVUTO: No, I understand that, Senator. But I just find it weird that whoever arranged the meeting with the S&P ratings folks, what the S&P folks will say is we risk financial Armageddon if we don’t raise this debt ceiling or default, the triple-A credit rating goes away.
So obviously, I would assume that it was meant to scare Republican members who were there of what they risk to do.
DEMINT: Well, I don’t think so, Neil, because if you read the statements that we’ve gotten from Moody’s and Standard & Poor’s, it says if we raise the debt limit without credible, significant long-term deficit reduction, they’re going to lower our bond rating.
So they’re not after us just raising the debt limit. They know we have to do this as part of this.
CAVUTO: All right. Putting some meat behind it, some teeth behind it.
CAVUTO: Let me get a sense, though. You’ve been a critic, as you have written very eloquently in your book, about this sort of facade we go through when we constantly raise the debt ceiling and keep doing this. We’re in this jam because we keep doing this. And when you go back through administrations, Democrat and Republican, 17 or 18 times through the Reagan administration alone, to what end?
Because the debt just keeps piling up regardless, and I’m wondering what we solve with a quick agreement, period.
DEMINT: Well, we don’t need to panic and make a bad agreement.
What we need to do is set goals over how much we will cut next year, how we will spend over the next 10 years. Let the American people decide about a balanced budget. I know I sound like a broken record, Neil, and the president says we do not need a constitutional amendment to do our job. Frankly, history says we do.
The debt limit is supposed to stop us from spending, but this is the 10th time in 10 years that we’ve raised it. So, I think we are on the side of the American people here. Over 70 percent think we need to balance our budget. And, so, this is the time to do it. We can’t borrow another $2.5 trillion and expect good things to happen in our country unless the world believes that we’re going to get control of this debt.
CAVUTO: If it doesn’t happen, people always assume everything stops on August 2. And obviously these dates are moving targets. But I don’t think they’re going to stop taking taxes out of my paycheck, so, the money keeps coming in, right? What can be done to prioritize that money going out then?
DEMINT: Right. Well, we’re not going to default. And we’re going to pay Social Security and Medicare. We have those trust funds that can be converted to public debt if we need to, to cash out. That’s not ideal. But we will make our Social Security and Medicare payments.
CAVUTO: So when the president said, Senator, a week or so ago, two weeks ago, I should point out, that those payments, Social Security and Medicare payments, a lot them hit on August 3, I believe, are in jeopardy, if we haven’t raised this, you say that’s hogwash?
DEMINT: That is hogwash. The only way they will not get paid is if the president decides not to pay them for political purposes. Because the resources are there.
There’s no question that sometime in August that some government contracts, some payments for things that the government’s doing could be delayed. Standard & Poor’s could call that a technical default, but we’re not going to default on our bonds and the debts that we have as a nation. We have got the tax money to do that.
If the president wants to drag us through that to try to blame us for his bad economy, the Republicans need to be prepared to take that fight to him.
DEMINT: Because we have put our best proposal on the table. They have put nothing. I don’t what else we can do but say, if you don’t like ours, give us a proposal.
CAVUTO: Senator, I wanted to flash to the Big Board.
Pam and Frankie (ph), if we could show this.
We were up a lot on the stock market today, 152 points. If they worried about default or something even worse in the next 10 days or so, they certainly had a funny way of showing it.
I know you don’t like to talk much about the markets, but why do you think they are behaving the way they are, that this doesn’t matter to them, or they you guys are going to reach a last-minute deal anyway? What?
DEMINT: Well, they probably think we’re gonna reach a deal and we probably will.
But they also know we’re not going to default on our loans. And, Neil, maybe it’s they’re optimistic about the ‘Cut, Cap and Balance’ plan. I don’t know.
DEMINT: But the markets know that we;re not going to default. We will pay our bills.
So, hopefully, they will stay steady, despite what the president does to try to create chaos in the markets.
CAVUTO: Real quickly, your relations with Mitch McConnell you rejected his, I guess, brokered deficit "get out of the way" agreement?
DEMINT: Well, I appreciate Mitch trying to negotiate in good faith with the president.
Now, I warned the whole conference a couple of months ago -- and maybe I am cynical -- that I thought the president was just using the Biden working group to burn up the clock, so he could create a crisis. It turned out that I was right. But I can’t fault Mitch McConnell or John Boehner for trying to negotiate in good faith.
But, frankly, we were not elected in November to make it easier for the president to spend money, increase our debt. This is a time Republicans have to take a stand. We have put a plan on the table that solves the problem. If the president wants to reject it, then he owes America his plan.
Senator, it’s always a pleasure. Good seeing you again.
DEMINT: Thanks, Neil.
CAVUTO: Senator DeMint.
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