This is a rush transcript from "On the Record," December 10, 2013. This copy may not be in its final form and may be updated.
GRETA VAN SUSTEREN, FOX NEWS HOST: This is a FOX News alert. A bipartisan budget deal on Capitol Hill. House Budget Committee Chair Paul Ryan and Senate Budget Committee Chair Senator Patty Murray hammering out the agreement.
Congressman Paul Ryan joins us.
Nice to see you, sir.
REP. PAUL RYAN, HOUSE BUDGET COMMITTEE CHAIR: Hey. Good to be back with you, Greta.
VAN SUSTEREN: You must be happy tonight. You hammered out this deal with Senator Murray?
RYAN: I am. I am. It's a deal that moves the ball in the right direction. It cuts the deficit without raising taxes by cutting spending in smarter ways than the across-the-board approach. All of our members were worried about all the defense cuts. We are stopping the military from getting cutting further and we are cutting spending in smarter ways on auto pilot programs that have been untouched for years by Congress. And we're doing it in a way to make sure that there is no tax increases and that we actually lower the deficit versus doing nothing.
So if you take a look at --
RYAN: Do you want me to walk it through it a little bit I'm happy to do that.
If you take a look at this chart, this shows you what we call discretionary spending, spending on government agency budgets. The blue line on the top here shows you the agreement we had a year ago under the Budget Control Act. The sequester is the red line. That ended up cutting spending. What this green area does is it reflects what we are doing, which is by preventing the military from getting cut any further, we're putting a little bit of money back in the sequester here and we're paying for it by cutting spending in other areas of government.
For instance, we're asking public employees to pay a little bit more for their pensions. Our argument is that hard-working taxpayers pay for their pensions in the first place and their benefits are on average better than the taxpayers who pay for them in the first place. We have got a number of reforms that are permanent, that actually save more money and pay for some relief of "The Sequester."
We also see that this puts us in the right direction because, the numbers down here, a year ago when I was passing a budget in the House, we were hoping for a trillion, $19 billion in total discretionary spending. We won't hit that spending level until the year 2017 with this agreement.
So we are well ahead of schedule and we are getting more deficit reduction in spending cuts in areas that we have never been able to get before. That's why I think this is a good agreement and it makes divided government work and prevents government shutdowns, which we think is a good idea as well.
VAN SUSTEREN: I love any deal bipartisan in this city is a really good sign. I like the fact that it's two years so there is some level of certainty for the business community. Because that's what's been so painful the continuing resolutions no one know what was going to happen so they couldn't make business decisions. Other than asking the federal workers to pay more for pensions, where else?
RYAN: We are opening up a little bit of the Gulf of Mexico for oil and gas drilling, 172 million barrels of oil, 302 billion cubic feet of natural gas in an area that had been closed off now is going to be open up. We are saying that deadbeat dads who don't pay for their kids' Medicaid payments need to pay for them. Making sure we don't send prisoners checks from the IRS in prison that they shouldn't be getting.
VAN SUSTEREN: Hallelujah.
RYAN: We are making sure that people can't rip off dead people's identities so they don't keep getting checks to go to somebody else. There is a lot of fraud, waste. We also go after corporate welfare. Research and development program for energy companies that are subsidizing with public taxpayer dollars -- I mean, public spending for private taxpayer dollars. The point I'm trying to say is shouldn't be development costs. That's a program we get rid of. A lot of things like that.
VAN SUSTEREN: If Senator Pattie Murray was sitting right here what would see say she was happiest about?
PAUL: Stop government shutdowns and have the Congress actually appropriate money and don't do continuing resolutions anymore. Some relief from the sequester.
VAN SUSTEREN: You like that too though.
PAUL: She wanted relief from the sequester.
VAN SUSTEREN: You wanted relief from the sequester.
RYAN: So long as we paid for it and we paid for it with more deficit reduction. I didn't want to net out to zero. I wanted -- whatever we did, I wanted to make sure it was a step in the right direction towards fiscal conservatism towards deficit reduction. She wanted relief from the sequester. That's where we were able to find common ground. The way we decided to do these negotiations was I had core principles that I was not going to compromise. I'm not going to raise taxes and I'm going to lower the deficit. She had some core principles she wasn't going to compromise.
VAN SUSTEREN: Like?
RYAN: She wanted relief from the sequester. She wanted 50 percent go to domestic spending and 50 percent to go back to defense spending.
VAN SUSTEREN: Did she get that?
RYAN: She did get that and so what we did is found where is common ground. We looked at our budget passed in the house. Her budget she passed for the first time in three years in the Senate and the president's budgets. We looked at those areas of common ground, common understanding. We negotiated that and that's what this result is.
The way I look at this is you don't have to require another person to violate a core principle to get things done. You have common ground. This isn't the greatest agreement of all time. We have a long ways to go to get this deficit under control. This is a step in the right direction.
VAN SUSTEREN: This has obviously nothing to do with tax reform, right?
RYAN: It doesn't deal with taxes.
VAN SUSTEREN: It only deals with the whole budget. All right, one of the things that the Democrats want was to extend unemployment benefits.
RYAN: We didn't do that so there are a number of things that they asked for we wouldn't agree to. That's one of them.
VAN SUSTEREN: Did you ask for anything that they didn't agree to?
RYAN: Yes, I wanted to means test Medicare benefits. I wanted to have higher income seniors to pay more of their premiums for Medicare. They would not agree to that.
VAN SUSTEREN: Have you spoken to Speaker Boehner? Has he been part of this?
RYAN: He has been part of this. Our leadership team, I have spoken to dozens of colleagues in the House, talking them, getting their ideas, getting input, speaking with a lot of members in the Senate. Pattie Murray has done the same thing as well. I'm trying to get input from our colleagues. We haven't had a bipartisan budget agreement where both parties since 1986.
So putting something like this together is not easy to do. It allows for give and take. As far as I'm concerned, I think this is a step in the right direction. It advances our principles of fiscal conservatism. More importantly it stops the government from shutting down in January and stops the government from possibly shutting down in October.
And we think government shutdowns are not in our interest. I think some people would like to seat political distraction of a government shutdown. We would like to focus on doing oversight of the executive branch, oversight on Obamacare and oversight on the IRS and not focus on government shutdowns.
VAN SUSTEREN: Does this have any impact at all, directly or indirectly, on the fact that we going to likely hit the debt ceiling in the spring.
RYAN: This does not deal with that issue. Just like it doesn't touch taxes or tax reform. By limiting it in scope to spending in deficits, we're able to -- it's kind of an agreement.
VAN SUSTEREN: All right, in terms of getting it passed in the House, you are going -- I suspect you are going to need some Democrats.
RYAN: It's a bipartisan agreement. So we anticipate that as well.
VAN SUSTEREN: You are going to lose Republicans in the House.
RYAN: I anticipate that some people will not vote for it for various reasons. But, as far as a conservative Republican principle is concerned, we are lowering the deficit without raising taxes by cutting spending in smarter ways we have permanent spending cuts to pay for some temporary sequester relief. We are not turning the sequester off.
We are giving short-term relief for the sequester and keeping it. I think as far as conservatism is concerned we are advancing the ball. The problem is we didn't get everything we want I didn't pass my budget. My balances the budget in 10 years and pays off the debt. I know with this divided government I can't get that so I want to get this.
VAN SUSTEREN: All right, so you're going to lose some Republicans in the House, you get to pick up some Democrats. That's why I asked about the issue about extending the unemployment because that would have been a way to pick them up.
RYAN: It is but it's something that we weren't prepared to do. Democrats weren't interested in paying for it. That cost $20 billion to $25 billion. We also think that there is a big economic case to make with the fact that long-term unemployment is propped up. People are more induced to staying long term unemployed. That's what a lot of studies are showing by extending emergency unemployment insurance from 2008.
VAN SUSTEREN: Your press conference ended, I think, about 6:20, or 6:25. At 6:33, Senator Marco Rubio, Republican in the Senate had already issued his press release to everybody in the media saying he was opposed?
RYAN: Well, I haven't talked to Marco about it. I don't know that he has seen the contents of it. I do expect some people may vote against it for various political reasons. He has his reasons. In the minority you don't have to pass things. That's a luxury or not. That people have in the Senate. Marco is a very good friend of mine. I'm a big fan of his. I wish he would support it.
But, if he doesn't, that's fine. For me, I'm cutting the deficit without raising taxes and I'm getting permanent spending cuts from an area of spending that we haven't been able to touch for years. I think that's a good step in the right direction.
VAN SUSTEREN: What's Senator Murray's biggest problem?
RYAN: They don't like federal employees, the idea that we were going to ask federal employees to pay more for their pensions.
VAN SUSTEREN: Is Congressman Van Hollen -- he has a lot of federal employees. He is a big mover and shaker in the House. He has had a lot of federal employees.
RYAN: He had a hand in how we did this. I was willing to negotiate on how we treated federal employees. Not if we made them pay more for their pensions. He had a very substantial involvement in how this policy works. What we basically want to do is make sure that federal employees had their benefits more in line with the hard-working taxpayers that pay for them. This is something we dealt with in Wisconsin.
States are dealing with this all over the country. We really think it's time we deal with this at the federal level. I didn't get every policy I wanted on this. We got a substantial down payment on this. Senator -- and Congressman Van Hollen was a part of that.
VAN SUSTEREN: I actually think that the certainty is such an important element of this. No one gets what he or she wants. The uncertainty is so important for economy, any time we get give it a shot. You know, that that helps.
RYAN: I think the idea of a government shutdown in January and then the idea of another government shutdown in October, and getting rid of that is good.
VAN SUSTEREN: To jump all over.
RYAN: I think there are a lot of people who would like the distraction of a government shutdown for one reason or the other. The administration is not really high on the Obamacare focus that is occurring in this country.
VAN SUSTEREN: Did they like the shutdown?
RYAN: Completely unraveling.
VAN SUSTEREN: Do you think they like the shutdown?
RYAN: I don't know. I wouldn't say that they like shutdowns, but I think they like to get off ObamaCare and by not turning the government down, we are not get off ObamaCare. Keep speaking truth to power. We are going to keep doing shining the light on the problems of the law. And that to us, gives us a good position. The last point I would make is this retains the power of the purse in Congress, the legislative branch.
We are supposed to set spending. We are supposed to prioritize funding. We were supposed to exercise the power of the purse. For the last three years we have been doing these things continuing resolutions where we delegate that power to the executive branch. I want Congress to reclaim that power from the administration doing something like this, guarantees that we do that.
VAN SUSTEREN: Vote likely on Thursday?
VAN SUSTEREN: All right, Congressman, thank you. And congratulations to both you and Senator Murray. Good luck.
RYAN: Appreciate it.