This is a rush transcript from "Your World," June 20, 2012. This copy may not be in its final form and may be updated.
NEIL CAVUTO, HOST OF "YOUR WORLD": Well, it doesn't have to come to a House vote on contempt against the attorney general of the United States. Darrell Issa says that vote can be avoided on the floor if some documents are handed over fast from the attorney general's office.
Speaker John Boehner, Eric Cantor, part of the Republican leadership, saying the same thing. But if positions remain as they are, that House vote should be coming next week.
Part of the Republican leadership joining us right now, Wisconsin Congressman, House Budget Chief Paul Ryan.
I know all of this is fast-moving, Congressman. I'm glad to have you here. But do you subscribe to that view as well? The documents come in, a void is -- a vote is avoided?
REP. PAUL RYAN, R-WIS., BUDGET COMMITTEE CHAIRMAN: Yes, I do.
You know, Attorney General Eric Holder brought this upon himself. He has been stonewalling Congress for 16 months. And, yes, he can avoid this if he just brings the documents that have been requested for months.
CAVUTO: Do you think -- a lot of cynics are going to say very quickly, that this is pretty much along party line, that this is sort of like a Republican cabal to embarrass the attorney general, embarrass the White House. What do you say?
RYAN: I think what is embarrassing is Fast and Furious. It's something that never happen ever again, and we need to get to the bottom of it.
And all Congress is doing, Neil, is its job detailed in the Constitution to conduct oversight of the executive branch. We have a separation of powers for a very important reason. It to preserve liberty and limits to government. And this is being infringed upon by this stonewalling.
And so we are just simply doing our jobs here in the legislative branch.
CAVUTO: Do you think this is going to escalate to a full-blown constitutional crisis?
RYAN: Yes, I don't know.
RYAN: I don't know. I think that is up to Attorney General Holder. I really don't know the answer to that.
If you don't mind, I would like did switch gears, sir, to Chuck Schumer and others who have been critical of you from beyond Medicare now and I guess throwing granny off the cliff to throwing the middle class off the cliff, saying that a lot of your economic prescriptions benefit the high and mighty, the rich, and -- like Mitt Romney, a man with whom I don't know, depending on the Republican operative, you might be running, it's just one-tiered and only one-tiered.
We called Chuck Schumer to come on and talk to us. He refused. We're happy that you did not. But what do you make of that?
RYAN: The Senate Democrats put out a report on our budget and it wasn't flattering. I am not really surprised about that, Neil.
CAVUTO: All right, so that is the Fox News Alert. But go ahead.
RYAN: Yes. That is breaking news on some stations, I guess, yes.
RYAN: But, so, first of all, what we are talking about is tax reform.
Here is the issue about this, Neil, is there are a lot of Democrat who actually agree with what we're proposing. Erskine Bowles and the fiscal commission proposed the same kinds of tax reform, lower tax rates by broadening the tax base. And those people who get most of the tax loopholes are the people in the top tax brackets in the first place that we are talking about curtailing in order to give everybody, families and small businesses, lower tax rates.
Let's not forget that our competitors around the world are lowering their tax rates. We have one of the most progressive tax systems in the industrialized world. We have among the highest tax rates. And it is putting us at a huge competitive disadvantage. It's costing jobs and its costing growth.
Where I come from, in Wisconsin, nine of 10 businesses file their taxes as individuals. Chuck Schumer and Barack Obama are proposing that the effective top tax rate in January go as high as 44.8 percent. This is a job killer. It is going to hurt prosperity.
What Mitt Romney is talking about, what he is proposing, is to get back to an American idea of an opportunity society with a safety net. Turn economic prosperity back on. Have a society of upward mobility, not this redistribution, tax, borrow and spend mentality that has dominated Washington and has given us the worst recovery since World War II.
And so if those kind of economic prescriptions that Chuck Schumer and the rest are talking about what would be successful, worked, we would be entering a golden age, along with Greece, right now, Neil. We are not. What we want is economic growth. We want to get spending under control and we want entitlement reform and we want to dodge a debt crisis and we want to get people back to work.
That is what Mitt Romney is talking about. He was in Janesville, Wisconsin, on Monday talking about this. That is what we're talking about. And bipartisan commissions, Democrats who are out of Congress are agreeing with us. Get your tax rates down, so you can grow jobs and the economy.
CAVUTO: But are you concerned that because both sides are so cemented in their positions, for whatever reason, that there is not going to be any middle ground and we're going to be facing a time bomb at the end of this year, and that the closest prescription I hear both sides coming up with, is maybe, maybe a one-year extension of the Bush rates, with the promise -- I think it was Mitch McConnell on this very program who said of serious tax reform next year.
CAVUTO: And that -- that, of course, springs eternal as hope, but probably unrealistic, don't you think?
RYAN: Well, the whole thing you are mentioning that the Democrats put out today was about our budget, which says we want to do tax return, a 10 percent bracket for low- and middle-income taxpayers and a 25 percent top rate, 25 percent corporate rate with a territorial system.
We think that is going to ignite economic growth. And you can do it in such a way that it doesn't cost you revenue from what we already raise in the federal government.
CAVUTO: But would any of your plans, Chairman, look into what Jeb Bush has said, a balance? And it doesn't even have to be a fair balance. It could be $1 in revenue for every $9 or $10 in cuts. I think to quote him or paraphrase him; he would sign up for that.
CAVUTO: Would you?
RYAN: Here is the problem with this current dialogue.
You never get the spending cuts. Barack Obama -- President Obama -- excuse me -- President Obama's budget, his tax increases don't even pay for a fifth of his proposed deficit.
CAVUTO: So you would never even entertain that ratio? That would be out because you don't think you would get the spending...
RYAN: I am not going to say...
RYAN: I am not going to say or negotiate with myself. I don't see the point in negotiating with myself on ratios, when we are talking about comprehensive tax reform, which we do believe would bring in higher revenues, and getting spending under control.
The problem is, our friends on the other side of the aisle want to pocket the higher revenues and never give up the lower spending. And so what is happening here is they just want to increase revenues and pile it into more spending...
RYAN: ... which drives us deeper into a hole.
Here is the point I would say. We are going to bring a bill to the floor in July that says extend the current code for a year and, yes, have a fast-track procedure to actually get fundamental tax reform. We are working with Senate leaders on how to do that, so that we can be really serious about reforming this tax code and not having these temporary rebates, not having all this uncertainty pile up at the end of the year.
So, we are passing legislation this summer in the House to deal with this train wreck at the end of the year. Unfortunately, the Senate, because they have not passed a budget in three years, the president has not offered a solution other than massive tax increases, we are going to have this impasse at the end of the year.
CAVUTO: All right.
RYAN: And, so, yes, I think a lame duck is going to determine this stuff. And who wins the election will largely determine how the lame duck plays out.
CAVUTO: All right.
RYAN: If the president wins, massive tax increase; if we win, tax reform.
CAVUTO: We will see.
CAVUTO: Congressman, Mr. Chairman, always a pleasure. Thank you very, very much.
RYAN: You bet, Neil.
CAVUTO: All right.
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