Transcript: Sens. Conrad, Klobuchar on 'FNS'

The following is a rush transcript of the December 20, 2009, edition of "FOX News Sunday With Chris Wallace." This copy may not be in its final form and may be updated.

CHRIS WALLACE, HOST: Early Saturday morning as snow fell on Capitol Hill, Democrats secured the 60th vote from Nebraska Senator Ben Nelson. Now it appears to be just a matter of time and parliamentary procedure before they pass health care reform on Christmas Eve.

Here to discuss the package are two key Democratic senators. Kent Conrad is chairman of the Senate Budget Committee. Amy Klobuchar is a member of the Joint Economic Committee.

And, Senators, welcome to "FOX News Sunday."

Senator Conrad, we went through some of the strong points of the Democratic plan with Senator McCain, so I'm going to ask you to address some of the problems, and let's put them up on the screen.

According to the CBO, federal spending on health care goes up about $200 billion over the next decade. It doesn't bend the cost curve down. The bill raises $518 billion in new taxes at a time when unemployment is 10 percent. And it leaves 23 million Americans still uninsured.

As chairman of the Senate Budget Committee, isn't there a lot wrong with this bill?

SEN. KENT CONRAD, D-N.D.: Look, no legislation is perfect, but this bill is a very significant advance to address health care reform. Fact is it reduces the deficit in the first 10 years by $130 billion, in the second 10 years by $1.3 trillion. That is a major accomplishment.

With respect to bending the cost curve, CBO says in the second 10 years it does bend the cost curve — in the first 10 years very modest increase, but you'd expect that when you cover 30 million more people.

What's remarkable is in the second 10 years, according to CBO, it does bend the cost curve in the right way.

WALLACE: One of the ways that Democrats got Ben Nelson's vote — and this has been remarked on by Senator McCain — was to pick up the entire cost, federal and state, of the expanded Medicaid coverage in one state, Nebraska, forever, what Republicans are calling now the "Cornhusker kickback."

That's tens of millions of dollars on top of the $300 million to get Louisiana senator Landrieu on board. As chairman of the Budget Committee, how do you justify sweetheart deals for a few states?

CONRAD: Well, on a policy basis, look, all states have the federal government picking up all of the Medicaid expansion through 2016, so that's...

WALLACE: But only one state after that.

CONRAD: But the fact is no Congress can bind a future Congress. So that's, frankly, not without a whole lot of manning. Let's just be frank. The reality is every state has all of the Medicaid expansion paid through for 2016.

After that, states like mine and states like Nebraska that are going to be having Medicaid expansions, most of it, the overwhelming majority of it — in my — in my state, 99 percent of it is paid for by the federal government.

WALLACE: All right. You said...

CONRAD: That's true of all the states that...

WALLACE: You say it's a policy matter...

CONRAD: ... are in that category.

WALLACE: ... it's a political matter. I mean, does it offend you in any way that Louisiana gets a special deal, Vermont gets a special deal, Michigan gets a special deal?

CONRAD: Look, my state gets a special deal. Virtually every state gets some kind of differential treatment based on their situation.

My state along with the other frontier states, five in number, get an increase in their Medicare levels of reimbursement because we're the lowest states in the country. And that doesn't offend me at all. It's, in fact, fair.

SEN. AMY KLOBUCHAR, D-MINN.: And actually, Minnesota, as a part of an amendment that Senator Grassley introduced, also because we are a high-quality, low-cost state, got a good deal on that as well.

And I'd add one more thing, that medical device tax — remember that? — $40 billion reduced to $20 billion. Evan Bayh and I led that effort because it fell on our states — Indiana, Minnesota, Massachusetts. So when you really look at this...

WALLACE: But I thought — I thought President Obama was going to change the way business is done in Washington. This sounds like politics as usual.

KLOBUCHAR: I think you would agree with me on the reduction of this tax. It's better for the country. It's better for the country that with this burgeoning industry that exports products...

WALLACE: But it wasn't — it wasn't done for that reason. It was done to get — I mean, it was done in all these cases to get individual senators.

KLOBUCHAR: People fight for their own states. That's the nature of a democracy.

WALLACE: Isn't that business as usual?

KLOBUCHAR: I think that that is not the business as usual when Obama was talking about — he was talking about under-the-table deals that people find out about two years later. I'd say this process has been fairly transparent. Like we're up here talking about it right now.

WALLACE: So we find out about it now instead of two years. All right.

Senator Klobuchar, let me ask you about another aspect of the effort to win over Senator Nelson. Democrats agreed to further limit abortions in these new public exchanges.

In fact, Nebraska or any state can vote to ban any policies being offered on the public exchanges from offering any abortions, even to women who would pay for them privately. As a pro-choice woman, how can you accept that?

KLOBUCHAR: Well, first of all, I preferred the original Senate language, but we had a job here, and that was to get something done for the people of this country with premiums escalating, Medicare going in the red by 2017. We had to get something done.

What this was, was a balance. There was general agreement. You want to keep the Hyde amendment in place. That's been in place in decades. It says no public funding for abortion. The question was how do you do that when you're dealing with private exchanges.

And what the compromise said was basically if you're getting subsidies, you can choose, you can have a policy that has abortion in it, you can you have a policy that doesn't. There always has to have a policy that doesn't cover abortion.

If you're in one that covers abortion, then you have to have two transactions, basically, for how you pay for that to make sure that no public funding...

WALLACE: Are you — are...

KLOBUCHAR: ... is used for that abortion.

WALLACE: Are you offended by this?

KLOBUCHAR: I am offended that so many people don't have insurance in this country. I'm offended that kids get sick and their parents are running around trying to get treatment for them because they are kicked off their insurance. I'm offended by that. Would I have preferred the Senate language originally? Of course I would.

WALLACE: Let me ask you, though, as a liberal Democrat, there's a lot that you have to stomach in this bill. And let's put it up on the screen. No public option. No Medicare buy-in. No end to the antitrust exemption for insurers. New restrictions on abortion.

As you well know, you're a liberal. There are a lot of other liberals like Howard Dean, like some of the big labor unions, that say it's a bridge too far, that this is no longer true reform, that it's a bailout for insurance companies, and the bill should have been voted down.

KLOBUCHAR: My major focus here, Chris — my major focus was always on reducing cost. Minnesota is a medical Mecca. We have high quality, low cost. And I wanted to take that model. And you see all kinds of cost reforms in this bill.

So that what's happening right now is a bunch of our taxpayers' money — getting sucked down to Florida where they don't have as efficient a health care system. I think the people of Florida should have Mayo-type services.

WALLACE: So what...

KLOBUCHAR: They should be able to have high-quality, low-cost care. That was my major focus.

WALLACE: So what do you say to a liberal like Howard Dean who says kill the bill?

KLOBUCHAR: You know, I disagree with him. I don't have that ability to just, like, leave my Christmas presents and go home. We had to get something down here.

WALLACE: Senator Conrad, what do you expect to happen? Because now this isn't the end of the process. It's just another step in the "Perils of Pauline."

What do you expect to happen in the House-Senate conference next month? After struggling for months to get Senate Democrats on board to accept this, what are you going to do for Democrats who have a bill which is considerably to the left of your bill?

CONRAD: I think any bill is going to have to be very close to what the Senate has passed because we're still going to have to get 60 votes. And anybody who's watched this process can see how challenging it has been to get 60 votes.

And let me say, if I can, on this question of reducing Medicare, there are $500 billion of savings to Medicare. Most of those savings have been negotiated with the providers. They're going to get less than they were anticipating. They've agreed to those savings because they know they're going to get 30 million more customers. That is a dramatic increase in business for them, and they are sharing some of the savings so that we can pay for this bill. There's not unreasonable.

WALLACE: But to go back to the question of the conference, you're saying that you don't — you can't go further, that the House is basically going to have to accept — the House is going to have to accept the Senate bill?

CONRAD: It is very clear that the bill, the final bill, to pass in the United States Senate is going to be — have to be very close to the bill that has been negotiated here. Otherwise you will not get 60 votes in the United States Senate.

So, look. This is a bill that does reduce the deficit according to the independent expert. This is a bill that expands coverage to 30 million people. This is a bill that will begin to control the cost explosion, has got critically important insurance reforms, delivery system reforms.

So those who say kill the bill, I think they have really missed the boat. This is critically important legislation to this country. And frankly, to do nothing, which is what I heard Senator McCain say — that's not an option.

We are headed for Medicare being bankrupt in eight years. Premiums are rising three times as fast as wages. Doing nothing is really not an option.

WALLACE: Senator...

KLOBUCHAR: (inaudible)

WALLACE: Let me pick up, if I can...


WALLACE: ... because we're running out of time, Senator Klobuchar.

According to the latest Rasmussen poll — and let's put it up on the screen — 57 percent of voters given a choice between do nothing — you were just talking about this, Senator Conrad — do nothing or pass this bill, 57 percent say it would be better to pass no health care reform bill. Only 34 percent say it would be better to pass the bill.

Senator, don't Democrats run a considerable political risk when you're going to pass major legislation with no bipartisan support over what seems to be almost a 2-1 opposition from the American people?

KLOBUCHAR: Do you know what the poll numbers were on Medicare when they voted for Medicare decades and decades ago? Like 28 percent of the people favored it. Now 96 percent do.

I don't blame the people for being mad right now — all of this bickering. This thing has gone on and on and on. They want us to get something done. My view is once we get this done, some of these reforms are going to hit immediately.

If your kid gets sick, you're no longer going to be banned from getting insurance. Seniors are...

WALLACE: Yeah, but most of them ...

KLOBUCHAR: ... going to be able to ...

WALLACE: ... aren't going to kick in till 2014.

KLOBUCHAR: Well, that got a little changed with this amendment. By 2011, you know, seniors are going to be able to start having some of their prescription drugs covered that weren't covered before. The taxes actually got moved, a number of them, to 2011. So you saw bringing together some of the taxation and the benefits that we didn't have before in this amendment.

WALLACE: Most of the benefits don't come in till 2014, Senator.

KLOBUCHAR: But a number of them come in sooner — the real important one on the prescription drugs, the preexisting conditions on kids, the lifetime limits on what the coverage is. A number of them have been moved up.

WALLACE: Senator Conrad, we've got about 30 seconds left. You said the other day that in the short term this is going to be a political drag for Democrats. How come?

CONRAD: Because there have been hundreds of millions of dollars spent misrepresenting what is in this bill, and people are confused. People of my state have had millions and millions of dollars of advertising spent saying things that just aren't so about this legislation.

WALLACE: Senators, well, that's one of the reasons we have you and these shows exist, is so you can — you and Senator McCain on the other side can set the record straight.

Thank you so much for coming in today, both of you. I know it wasn't an easy trip, although for you, from Minnesota ...

KLOBUCHAR: I have all the ...

CONRAD: North Dakota.

WALLACE: Exactly. I mean, this I ...

KLOBUCHAR: We're used to it. Why do you think you invited us today?

WALLACE: Well, actually, we did take that into account. Thank you both.

KLOBUCHAR: Thank you.

WALLACE: Merry Christmas to both of you.

KLOBUCHAR: Appreciate it.

CONRAD: Merry Christmas to you, Chris.

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