This is a rush transcript from "The Five," November 27, 2012. This copy may not be in its final form and may be updated.
DANA PERINO, CO-HOST: Congress has 35 days to reach a deal and prevent the economy from going over the 'fiscal cliff.' But it's no mystery what the issues are that must be resolved. The Democrats in Congress know, Republicans know and so does President Obama. Entitlements are pushing the country toward financial ruin.
In fact, here is what the president said all the way back in 2010.
(BEGIN VIDEO CLIP)
PRESIDENT BARACK OBAMA: The major driver of our long-term liabilities -- everybody here knows -- is Medicare and Medicaid and our health care spending. Nothing comes close. Social Security, we could probably fix the same way Tip O'Neill and Ronald Reagan sat down together and they could figure something out. That is manageable. Medicare and Medicaid -- massive problems down the road. That's where -- that's going to be what our children have to worry about.
(END VIDEO CLIP)
PERINO: But here we are, two years later, and still no plan. Some on the left in Congress are even refusing to deal with that simple reality. For example, Vermont Senator Bernie Sanders who caucuses with the Democrats. Take a listen.
(BEGIN VIDEO CLIP)
SEN. BERNIE SANDERS, I-VT.: I get very nervous when I hear the president and others continue to talk about, quote/unquote, "entitlement reform", which I'm afraid is just another word for cuts in Medicare and Medicaid and maybe even Social Security.
(END VIDEO CLIP)
BOLLING: All right. So, Brian, let's start with you today. You look surprised.
BRIAN KILMEADE, CO-HOST: I am a little surprised. Yet honored in the same way.
PERINO: I figured, you know, we didn't start with you yesterday. Let's start with you today. Do you think that they are any closer to a deal? Like -- it seems like after Thanksgiving, people started to get back to work and they're staking out some territory.
KILMEADE: I was really encouraged to see The Washington Post said over the weekend, Sunday and Monday, the president picked up the phone and he was talking to leaders on both sides, saying, let's get something done.
But then I pick up The New York Times today -- by mistake -- and I found out inside, you have the liberal Democrats like Senator Rockefeller, you have Dick Durbin and others saying, hey, we better not touch entitlements. Mr. President, you better watch yourself because we won the election. Let's focus on those taxes on the rich. Let's deal with entitlements down the line.
That scares me because that's unrealistic. It goes against what we just heard the president of the United States say.
PERINO: Eric, when it comes to the math, when you do the math, it is clear that entitlements are the thing that they need to do and they have this good opportunity in front of them. And yet, still, we don't hear any sort of plan to deal with it.
ERIC BOLLING, CO-HOST: Sure. We heard today, Senator Reid said, quote, when asked, he couldn't name any of the cuts the Democrats are willing to offer in the 'fiscal cliff' negotiations. He said, quote, "We need to get credit for cuts previously made." This is today, the senator says. Cuts previously made -- I'm scratching my head to figure out what cuts the Democrats made prior to -- that they want credit for. If they did make, quote/unquote, "credit cuts," why did we run up four more years in a row, another trillion dollar deficit?
They don't get credit for anything. If you want us to do real, honest-to-goodness negotiations, start fresh right now. Talk about cuts and then talk about -- how are we going to raise revenues.
PERINO: Bob, what would Harry Reid mean by that? That they should get credit for cuts they already made on what?
BOB BECKEL, CO-HOST: Well, that's a $60,000 question. I'm not exactly sure what he is talking about. But I know this much, there will be cuts in entitlement programs. There will be readjustment in entitlement programs. And there will be a tax increase on the wealthier Americans of some size.
I cannot believe that Obama is going to travel around the country and make a stink about this if he doesn't think he's going to be able to get them to go along with at least some marginal increase of rates.
PERINO: That's a good point.
Andrea, let's get your take on that because the president just off campaign trail and a major victory in the 2012 election. But now, he's going to go back out and he's going to try to sell the plan that I think he believes he just won on.
Do you think that he needs to do this type of road show to try to get support for this?
ANDREA TANTAROS, CO-HOST: That's all he ever does is road shows. I mean, this is how he wins. It's how he won the election, with a giant -- as his own spokesperson called it -- PR offensive. Unfortunately, we're going to be losers because it doesn't do anything to change the policy.
Now, I don't begin to know how Harry Reid thinks or how his brain works. But if you believe what Nancy Pelosi said, she said, "If you want to look what our plan is for Medicare, just look at ObamaCare."
So, I'm wondering, Bob, if the cuts that Reid is talking about are the $500 billion in cuts that they already made to Medicare that were denied the entire election, if they're actually going to start to take credit for those.
But this is really scary, Dana, because he's trying -- he's trying to rally the people on his side. He believes that they think they should tax the rich and I have to say, he doesn't even have the will of his own party. Senators like Chuck Schumer says, no, got to be $1 million or more. Conservative senators that are up for re-election in two years are saying, no way.
PERINO: And the ones who just got elected who campaigned against --
BECKEL: Let's remember that he took a lot of heat the last time around when he got to the debt ceiling -- debt ceiling issue. And he was negotiating the whole time and not out in the country campaigning. And this time around, I think they've decided that that kind of strategy, staying in Washington, dealing with the Republicans --
BOLLING: Campaigning what though, Bob? I mean, who is he campaigning? You got one size that says raise taxes. The other side -- I don't --
BECKEL: I think he's got --
BOLLING: Look, the Super Committee couldn't get it done. The Gang of Six couldn't get it done. How are these people going to get it done?
We have Grover Norquist saying, all the people who are allegedly going to violate their pledge, I think only Lindsey Graham is the one who said, yes, in fact, we'll violate it. The rest of them are kind of waiting for Democrats to come up --
BECKEL: Is there a way to ban Grover Norquist's name from the show?
BECKEL: Because he's an idiot, that's why.
PERINO: Let me ask you about the road show. President Obama goes out and he talks about raising taxes on the rich. I think they're probably is -- there is a constituency in America who says, yes, it's the right thing to do.
Boehner says, we're for more revenue, we would get it a different way because we think raising rates will hurt the economy, but we would reduce their deductions so you get to the same place. But still, and none of that, with President Obama's going on a road show, he doesn't even answer the question that he brought up in 2010, which is -- then what are you going to do about entitlements and how would you make it better?
PERINO: I don't think raising retirement age by six months or a year is going to solve the problem.
KILMEADE: I tell you, my head is going to explode if he goes out on the road and keep saying we've got raise taxes to balance the budget. The math doesn't add up.
And number two is, he has to go in and roll up the sleeves and get things done behind closed doors. And if the media is frustrated, then let them be frustrated. He just got to go in and make a deal.
BECKEL: Brian --
KILMEADE: He's got to give in and give the framework out. He did not --
BECKEL: There's one big the difference this time around, he won.
BOLLING: Hold on. This is a very important point. What do you mean go behind closed doors --
KILMEADE: I want him to go with Speaker Boehner and I want him to say, this is what -- here are my cards. What are yours? And then come out and say, we've got a deal together.
BOLLING: But they did that.
TANTAROS: They did.
BOLLING: They did that at the fiscal cliff -- at the debt ceiling. Here is the deal. You're coming up with $600 billion. We're going to come up with $600 billion. They say they had an agreement. They walked away from the table. All of a sudden, President Obama wanted $800 billion.
TANTAROS: Because they didn't want the entitlement cuts. It was the left that didn't want the entitlement cuts. And, Bob, you've even said yourself on the show -- that's what sunk the deal as President Obama couldn't get his side to come along with it.
BECKEL: I agree.
PERINO: That is incredible from the PR standpoint that the Republicans get a lot of attention for being divided. It's actually the Democrats who are more divided but they don't get as much attention. Why is that?
BOLLING: Because the media focuses on -- you know, they want to take shots. Honestly, there is a problem, though, Brian, because on the right -- let me phrase this properly -- between the Republicans and the right, there's another divide.
Forget right/left divide, you have a divide on the right that says there -- who are staunch fiscal conservatives are saying, don't raise taxes, don't close loopholes, don't cut up deductions. Don't do anything that's going to increase revenue, unless you're getting the spending cuts. And the middle-of-the-road, some of these establishment Republicans are saying now, well, we need to work it. So, how you're going to get the House which is Republican to vote for it.
BECKEL: Deductions will be on the table. And I want to know what's the difference is between raising rates --
BOLLING: There's got to be more deductions, though.
BECKEL: Well, if you take deductions out, they're going to have fewer dollars in the pocket. The so-called wealthy people are going to have fewer dollars in the pocket. What's the difference, you raise their rates, they have less money.
TANTAROS: Yes. But the economy is much more sensitive to playing with marginal rates than playing with deductions. That's the biggest issue.
BOLLING: Can I show you the numbers? If you do the deductions that are proposed, it's a trillion dollars over 10 years. That's $100 billion a year. If you do -- if you let the Bush tax cuts for over $250,000, let those expire, that's another $80 billion. You're up to $180 billion and you have a deficit of $1 trillion a year. You're only 18 percent of the way. You are still missing 82 percent of the pie here.
BOLLING: That's the number. That is the exact number we're playing.
PERINO: Can I ask -- we have just two minutes left, can I ask you one other thing? Because you brought up transparency. There are some on right who are trying to push for the negotiations to be all up out in the public, to be broadcast on C-Span. Would you -- I think that's a terrible idea. What do you think?
KILMEADE: It is a terrible idea. It is a terrible idea, because the only time they really dealt with their sleeves up and working deals out -- I grant you, Eric, you are right -- in that very grand compromise. When you talk about stimulus package, when you talk about ObamaCare, when you talk about the auto bailout, they all did things totally on their own. The president was not engaged. He passed it along.
I would like to say him say, I don't care what Harry Reid says. Medicare and Medicaid and Social Security have to be restructured, not fine-tuned. And Obamacare has got to be in play.
BOLLING: You don't want to see it on C-Span? I do.
KILMEADE: I don't want to see these guys with makeup, what they look like, with their sleeves roll out.
TANTAROS: Dana, you worked on the Hill, I worked on the Hill. We both worked in Washington. The chances of it really happening on C-Span -- it would happen in the men's room. It would happen in the hallways. They'll be calling each other after the camera left the room.
PERINO: In the gym when they do P90X.
TANTAROS: Yes. You know what I think? Someone brought this idea to me and it's really crazy. What if Republicans were to say, I'm not going to vote on this. If you want to push for higher tax increases, Boehner brings it to the floor. They don't vote and this all becomes the Obama tax hikes.
TANTAROS: This becomes the Obama spending cuts. This all gets put on him. Let him own it. The people voted for him. Let them own it.
BECKEL: I'll guarantee you he'll get Republican votes on that.
KILMEADE: -- House Democrats going along with maybe a John Boehner caucus in order to pass it. That is how divided it could be. It could end up costing them the House. When it's said and done and we're sitting here on December 31st, on an emergency session of "The Five" -- I'll be here in case of an injury -- there will be sitting there saying this is deal we got to cut. And, unfortunately, we got to get the Democrats to come along with Republicans.
PERINO: But aside from politics, I don't think enough people are talking about what's the right policy, what's the right answer, what's the solution to get the economy going again? And see Social Security and Medicare saved for the next generation. That's -- no one is talking about it.
BOLLING: One quick point, can we as "The Five" or at least the conservatives, Bob, you should be interested in this, too, we can -- forget Social Security.
KILMEADE: We should include the crew.
BOLLING: We pay -- people pay into the Social Security system. It's supposed to be self-fulfilling. So --
BECKEL: Yes, they pay in Medicare, too.
BOLLING: No, no, but we way with payroll taxes and FICA into Social Security. It's government that raids Social Security. The only reason that Social Security is even on the table because they took $2 trillion that we paid into it and they've used it for other stuff.
BECKEL: Dana's original question was, do you want to have transparency and have like Grover Norquist sit down there and shoot his mouth off and make it difficult--
PERINO: No, he wouldn't be. He's not a member of Congress, Bob.
BECKEL: Well, he seems like he's a member of Congress.
PERINO: No, he's not. If I were Republicans, I would come out for getting away with the payroll taxes. And find the spending cuts to do it and put it on the table.
KILMEADE: If you want to reform Social Security, retirement age 91, and then --
TANTAROS: Dana, you brought up how they're not even talking about the policy. Actually, we had a presidential ticket with the courage to talk about the policy --
TANTAROS: -- but they were completely crushed by the media and the people.
KILMEADE: I know --
PERINO: Well, we're going to have to keep following it.
Right before, we came out, Keith Hennessey of the Hoover Institute put out a piece and called it -- he said that the president is bluffing. The president today saying through his spokespeople that he would veto anything that did not have the tax rate increase. But I think given that the economic consequences of that would be so dire, I think Keith is right, and the president is bluffing.
KILMEADE: It's a big bluff.
PERINO: We shall see.
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