Center Seat: Sen. Kelly Ayotte on the issue with bipartisan budget bill

This is a rush transcript from "Special Report," December 16, 2013. This copy may not be in its final form and may be updated.

BRET BAIER, ANCHOR: We are back with our panel and joined in our Center Seat by New Hampshire Republican Senator Kelly Ayotte. Senator, thanks for joining us. We know you are in between votes so we appreciate your time.

SEN. KELLY AYOTTE, R - NH: It is great to be here, Bret.

BAIER: So as it stands now, you're ready for this vote tomorrow on cloture on the budget? Where are you on this and how will you vote?

AYOTTE: Well, I appreciate the bipartisan work by Congressman Ryan and Patty Murray, but here's the issue. There is a provision in this that I think needs to be changed, and that is that we are taking it from the backs of our military retirees to pay for more federal spending. And this provision basically takes $6 billion for the retirement of our military retirees, the COLA that they receive, and they are the only group that gets hit directly in this. The changes for the federal employees are prospective for new hires.

And so I think that if you think about it, a man or woman right now serving in Afghanistan probably on their third tour, could be more tours than that, they may have served in Iraq as well, 19 years in. and the message we are sending them right now is that you of all people in this agreement will be singled out and that you will receive less. I think that's wrong. I've introduced an amendment for another pay-for that I think is much more responsible so we'll save the same amount of money so we don't have to take it from our military.

BAIER: Senator McCain has said that he thinks that Senator Levin has assured him that this issue will be taken up in the next year's authorization bill and it doesn't kick in until 2015. So that's good enough for him. He thinks that if you have to deal with it now that it starts to unravel everything else. That is not good enough for you?

AYOTTE: It is not good enough for me because, truthfully, in Washington, we'll review it, where does that get you? What does that say to the military retirees? I don't think it solves it for them, and too many things in Washington go under review and never get fixed and it never gets addressed.

So I think – I don't think $6 billion is a deal breaker, by the way. I've already introduced two amendments today on other ways to save money. Do you know over the 10-year window we're going to spend according to the CBO $47 trillion. We can't find $6 billion in waste, fraud, and abuse or something else in the government then to take it from our military retirees? I think that's absurd.

KATIE PAVLICH, TOWNHALL.COM: Senator, there is talk about the $60 billion, this money being paid back in, say, 10 years, right? But you've also mentioned there are tons of duplicate programs. The Government Accountability Office shows there are $250 billion a year in wasteful spending. Can you elaborate on whether Washington is ever take that and get rid of some of these programs that are duplicative instead of taking it off the backs of the military?

AYOTTE: Well, I think that's another really good point. Since I've been in the Senate I've voted repeatedly to implement the actual GAO reports. I'm a cosponsor of legislation to require the president to make recommendations and Congress to vote on the GAO reports. Tons of duplication, fraud, abuse, and we haven't implemented any of that. And here we are, let's take from the military retirees on a deal, by the way, that doesn't deal with the underlying drivers of our debt but somehow is singling out this particular group of people who have sacrificed the most for us.

BAIER: Kirsten?

KIRSTEN POWERS, COLUMNIST, NEW YORK POST: The debt limit is going to hit again in a couple of months and Paul Ryan has said that the Republicans are probably going to want to extract something for this. What do you think it is going to be?

AYOTTE: It is hard to know. You have -- if this agreement passes, it is a two-year budget agreement. So I don't know what the Republicans will extract from it with the two years set in place.

I do hope that we focus on the underlying drivers of our debt, really looking at reforming programs that are going bankrupt, making sure that we can set our country on a stronger fiscal path. Those issues aren't addressed in this agreement. So I'm not clear yet on what the House will put forward, but it has to be something connected to our debt. At times they have talked about unrelated provisions, but the thing about the debt ceiling, you wouldn't want to increase the debt limit on your credit card without dealing with the underlying problem if you're an individual. And I think that's the key for Republicans is to keep it on topic.

BAIER: Charles?

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: Let me switch to sanctions on Iran. I know you supported the bill. Will it pass the Senate? How many Democrats will you get to oppose the administration?

AYOTTE: Well, I think that basically what we're going to see now is there is a lot of concern about this, quote, so-called "interim agreement" with Iran. They don't have to dismantle any centrifuges, the plutonium reactor is not dismantled. There's so many concerns. We will see another round of sanctions proposed on a bipartisan basis that basically says to the administration if they don't follow through with real, measurable results as they are supposedly saying to the administration, then another round of sanctions will be imposed by the Congress automatically.

KRAUTHAMMER: Will it kick in automatically without allowing the president a waiver?

AYOTTE: It will be kicking in automatically. I think that the legislation that I have seen so far does have a waiver provision in order to get Democratic support.

KRAUTHAMMER: Then it is useless.

AYOTTE: I agree with you, Charles. I think there will be strong certification provisions, but I agree with you. I would like to see no waivers.

Here is the thing. We have been in a position right now, where the administration has been saying, I think, too much, don't impose additional sanctions because this may cause Iran to back off. I take a very different view. My view is, is that if Iran is serious, why should they care about prospective sanctions, because they won't have to worry about them if they are serious?

KRAUTHAMMER: But if you are serious to want to impose the sanctions if Iran is unresponsive, we know the president will waive it if he has a chance.  So why don't you stick to an automatic kick-in?

AYOTTE: I am happy to vote for an automatic kick-in. I would introduce legislation tomorrow to do that and so would many of my colleagues. We are not on the other side of the aisle getting the support for that, unfortunately. However, I will tell you this. I think they will be very, very strong, the requirements that the president will have to meet at least.

KRAUTHAMMER: But why not expose the Schumers of the world, introduce it without that waiver which is an escape hatch?

AYOTTE: Well, I agree with you. I think that the waiver provision is -- has been used too much from the administration.

KRAUTHAMMER: I beat that horse.

AYOTTE: You did beat it.

BAIER: The five follow-ups from Charles is pretty good, Senator.

I want to ask you this, because we get it all of the time. Is the Benghazi story going to continue? Is the investigation going to continue?  Is it going to lead to some kind of independent panel? Or do you think that it's run its course in your mind?

AYOTTE: Well, it hasn't run its course because we still haven't gotten answers.

BAIER: No, I understand. But is it -- on Capitol Hill, is the impetuous still there? Is somebody blocking it? We get these questions all of the time.

AYOTTE: I think the Republicans are in charge of the House. They can have a select committee on this issue --

BAIER: So why aren't they?

AYOTTE: -- that they haven't had. I have certainly urged the leadership in the House to do it. And if we were in the position in the Senate, where we had the majority, I can assure you, we will do it, because there are enough of us that say this has to be looked at. And it can't be looked at in this piecemeal fashion because the administration has, again, been able to sort of -- we'll answer you here but we won't answer you over here. And what we say here contradicts here.

And I think we have to look to the big picture here to get to the truth of what happened in Benghazi. But I've been disappointed that the House hasn't had a select committee. And in the Senate we've pushed as hard and will continue to push with any means that we can. But obviously the House having the majority right now for the Republicans, I would like to see them do the select committee.

BAIER: Does the budget pass tomorrow, does it get passed cloture?

AYOTTE: Right now I'm hearing that there may be enough votes for closure, but obviously they haven't been fully identified yet.

BAIER: Close?

AYOTTE: It is close, because just what I've seen which of my colleagues have come out and said they will support cloture, as far as I've seen, I've seen at least five now. And so if all 55 Democrats were to vote for cloture and everyone is present, now everyone is not always present, so it is close.

KRAUTHAMMER: What are you on cloture?

AYOTTE: I'm no. I'm no because I feel like this provision I talked about earlier can be fixed and can be fixed with savings that don't take it from the backs of our military and don't single out our military.

Understand, the military retirees get hurt on this agreement, where the federal employees, the changes only go to new hires. So the military didn't get the same protection, and I don't understand why that unfair treatment given -- you would think we would treat them the best with what they've done for our country.

BAIER: Well, senator, we really appreciate the hustle. We know you are in between votes and you have to get back over there, so thank you for your time.

AYOTTE: No, I appreciate it. Thank you.

BAIER: More with the panel after a quick break.

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