Deficit Debacle: No More 'Kicking the Can Down the Road' on Spending and the National Debt

This is a rush transcript from "On the Record," July 14, 2011. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Joining us Republican congressman Paul Ryan, chair of the House Budget Committee. Good evening, sir. And I just want to take up the point that I spoke with Congressman Van Hollen about, this corporate jet thing. I want to get this straight. What is your vision or view, or what happened, because this is something that's been kicked around politically and seems to taint the argument.

REP. PAUL RYAN, R-WIS., BUDGET COMMITTEE CHAIRMAN: It was in the stimulus package. None of us voted for the stimulus package. This is called accelerated depreciation. It's a tax policy that the president put in his stimulus package and passed. Now he's saying it's a corporate jet loophole. It applies to lots of things, airplanes included. What I find interesting about this one particular issue is it never came up in our debt negotiations. It never came up in discussions. First time I heard about a corporate jet loophole which, was in the stimulus package, was when he mentioned it six times in a press conference.

VAN SUSTEREN: You know, I don't -- I really I don't understand this. You know, it so cheapens his argument. I mean, to the extent that he has valuable arguments about certain things, when you look petty, when you cheapen it like that, you know, it's just astounding. And it's sort of -- it really doesn't elevate the discussion because these are important issues for Americans. I mean, there's a very big difference between these two parties. And August 2nd really does matter.

RYAN: And it just makes you wonder. When the rhetoric is over here but the actions are over here, when we're saying this in private but then they go and say something else in public, it makes it harder for parties to come together. It makes it hard for trust to be earned between two different parties to get to an agreement.

And so -- look, I understand it plays for good politics and good class warfare and makes it look like all we care about is our corporate -- who cares about a corporate jet loophole? It's -- it's -- we want to get rid of all these loopholes in tax reform.

And what they -- what people don't tell you is our Republican budget - - that's exactly what we propose doing. We're saying, Clean out the brush of loopholes and lower everybody's tax rates so we can create jobs in the economy. That way, the government doesn't lose any money, but we clean up the tax codes so we're not picking winners and losers in the tax code.

General Electric paid no taxes, but made a lot of money. UPS, another big company, paid about a 34 percent tax rate and their competitor, DHL, paid 24 percent. So there's something wrong with the fact that we're taxing a lot of employers more and we got to fix that.

VAN SUSTEREN: The tax code's a problem. The GAO has identified so many problems. ... Let me ask you this about -- Speaker Boehner, I think, has difficulty within his own party. He has people like you who under no circumstances will vote for -- to raise the debt ceiling with a tax increase, is that right?

RYAN: Yes, no, we should not be raising taxes in this economy.

VAN SUSTEREN: All right. And -- and -- and Senator McConnell has proposed sort of a staggered approach, a three -- three...

RYAN: Right.

VAN SUSTEREN: ... and there's under -- and so that would sort of kick the can -- not kick the can, but there are three steps that would...

RYAN: Right.

VAN SUSTEREN: ... it really wouldn't face the problem head on now, but would sort of do a little bit, a little bit and a little bit. You're opposed to that.

RYAN: I don't think it's the best idea.

VAN SUSTEREN: Would you vote for that, if it came to that, of Senator McConnell?

RYAN: I don't think it's a good idea for us to sort of negotiate through the media as to what we would take at the end of the day. But I think where this is probably headed is -- the president seems very unwilling to cut the level of spending that is required from our standpoint.

VAN SUSTEREN: What number is his willing -- what number do you understand he's willing to cut?

RYAN: It keeps moving every day.

VAN SUSTEREN: Because I mean -- because Congressman Van Hollen seems to think there's a number. Speaker Boehner says there's no number.

RYAN: I've heard three numbers today.

VAN SUSTEREN: Well, why can't you get together on this, at least get the number? I mean, this is getting absurd.

RYAN: So what we've said for months now is for every dollar you want to raise the debt limit, let's cut more than a dollar's worth of spending so we get a really good down payment on our debt and deficit.

Look, the debt is hurting the economy today. It's hurting job creation today. The president isn't coming anywhere close to being willing to cut that amount of spending, so he's -- he keeps moving the number down on spending cuts, not up. And that means to me we won't raise the debt limit for as long as he wants it to be raised for because he's not willing to cut as much spending.

And then comes your McConnell scenario or some other scenario, which is if he's only willing to raise the debt limit -- or this -- or raise spending cuts this much, then he's only going to get that much of a debt limit increase.


RYAN: But if he wants (INAUDIBLE) debt limit increase, we're not going to give him this much of spending cuts.


RYAN: We got -- we got to cut spending up here!

VAN SUSTEREN: Is he negotiating in good faith or you think he's been playing politics?

RYAN: It just keeps changing. So I don't know...

VAN SUSTEREN: What's the answer, politics or good faith?

RYAN: I'm not in the room. I'm not in the room, so I can't answer the question. Our top leaders (INAUDIBLE)

VAN SUSTEREN: What's your thought? You're not in the room, but you're hearing from the leaders. What, good faith or politics?

RYAN: I don't think he wants to cut spending and I think he wants to raise taxes. Look, you got to understand, the spending that has happened over the last two years has been enormous, unprecedented, highest since World War II. And that was a pretty big war.

He wants -- we've got a bunch of tax increases coming in 2013, $1.5 trillion in tax increases starting in 2013. That's hurting the economy today because businesses see the tax increases coming. He's now saying to us, I know I spent all this money, so raise more taxes to pay for it.

We don't agree with all the spending. We don't want to raise taxes even more than what's coming. We want to cut spending, and he just doesn't want to do that.

Now, I think we'll get spending cuts out of this because we have the House. And we're not -- but it's amazing to me that it's taken so much effort, all this wrangling, just to cut what I would consider a fairly modest amount of spending.

VAN SUSTEREN: Congressman, thank you. Congressman Paul Ryan, I should add, of the great state of Wisconsin.

RYAN: Thank you. Sorry for the coughing.

VAN SUSTEREN: No, I know you've been sick. Thank you, sir.