This is a rush transcript from "Your World," January 26, 2012. This copy may not be in its final form and may be updated.
NEIL CAVUTO, HOST OF “YOUR WORLD”: All right, debt spiking, time for more spending?
Well, a Senate vote today just clearing the way for the president to raise that debt ceiling another $1.2 trillion bucks. That brings it now to nearly $16.5 trillion. That’s more than this country churns out. That is more than our combined GDP. Think of that. We owe more than we have.
Count Republican Senator from Wisconsin Ron Johnson not happy at all.
But the beat goes on, Senator. It goes on and on.
SEN. RON JOHNSON, R-WIS.: Well, Neil thanks for having me on.
Yes, it is very unfortunate. This is not exactly a banner day for the United States Congress here. And, as you said, Neil, the very dangerous metric that we need to be concerned about is, how large is our debt in relationship to the size of our economy?
And noted economists take a look at economic history and say, when we are above 100 percent of debt-to-GDP ratio, you have a real hard problem, difficult time growing your economy. And I want people to think about -- relate that to their family.
If you are in debt in over your head, how can you grow your own personal economy? How can you increase spending when every dollar you have got is going toward the basics and servicing that debt?
(CROSSTALK)
CAVUTO: So, what are you guys going to do? What are you guys going to do?
If, in other words, you -- the president, for -- continuing to submit higher and higher budgets and all of that, and then the super committee completely bombs on coming to any sort of a consensus on cuts.
JOHNSON: Right.
CAVUTO: So we have these automatic cuts that really aren’t cuts. I mean, they just trim the growth in spending over the next 10 years.
This is not good, Senator.
JOHNSON: Well, it’s an important distinction, too, what you just said.
We are not cutting anything. We’re just reducing the rate of growth in spending. The debate over the next 10 years is President Obama in his budget wanting to spend $46 trillion. The House budget would have spent $40 trillion.
But, Neil, what we need to do is we need to hold their feet to the fire. The first thing is make sure the United States Senate passes a budget this year. It has been 1,002 days since that has happened. And it is very difficult to get into any kind of debate on how you’re going to restrain spending when the other side doesn’t even put its plan on a piece of paper.
(CROSSTALK)
CAVUTO: Well, here’s what scares me about that, Senator that life is going on, 1,000-plus days without a budget.
So I know the budget is important, but it must say something in Washington about how it’s deteriorated that you can go on in this surreal Disney World environment without a piece of paper for guidance, without a budget on which you go forward. Families can’t do that. Companies can’t do that. But you and your colleagues are doing it. I don’t understand.
JOHNSON: I am new here, Neil. And, of course...
(CROSSTALK)
CAVUTO: I understand, but it is what it is.
JOHNSON: I know.
In 31 years operating in businesses where there’s always a budget, this is the first time I have ever been involved in a financial entity -- and let’s face it, the United States government is the largest financial entity in the world -- that I am operating outside of a budget. But, Neil, it takes two to tango. And the sad fact of the matter is, it’s President Obama and his allies in the Senate that refuse to pass a budget. The House passed a budget. But I am hopeful. We had a Budget Committee hearing today with the Senate, and Chairman Conrad said he was dedicated to passing a budget this year, hopefully reducing spending by $5.5 trillion, was what he was...
(CROSSTALK)
CAVUTO: All right, we will see. We will see.
JOHNSON: Well, reducing the deficit by $5.5 trillion.
CAVUTO: OK.
JOHNSON: So, I know. We will keep their feet to the fire. That’s what we have got to do.
CAVUTO: All right.
Senator, thank you very much, Ron Johnson.
JOHNSON: Thanks for having me on.
CAVUTO: All right.
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