This is a rush transcript from "Hannity," June 28, 2011. This copy may not be in its final form and may be updated.

SEAN HANNITY, HOST: And tonight, tensions rise on Capitol Hill as the debt negotiations seem to be at a standstill. Now, after weeks of sitting on the sidelines, President Obama has finally injected himself into the discussions.

Now, he summoned Democratic leaders to meet with him tomorrow. Now the president along with the Vice President Joe Biden will meet with Senate Majority Leader Harry Reid and Senators Charles Schumer and Dick Durbin.

And on Monday, team Obama met with Senate Minority Leader Mitch McConnell, but no one is sure if anything was accomplished. No word yet by the way if another meeting is scheduled with Republicans.

So, where are these leave things? Americans have no choice but to wait and see if the White House will put their money where their mouth is and tackle this country's debt once and for all.

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    Now, earlier, I sat down for an exclusive interview with the Speaker of the House of Representatives John Boehner to get his reaction to the debt talks and much, much, more.


    HANNITY: Mr. Speaker, how are you?


    HANNITY: Welcome to New York.

    BOEHNER: Glad to be here.

    HANNITY: Paul Ryan comes out with a plan because Medicare is going bankrupt, we're now dealing with a really pivotal moment in the American economy. And the president comes out and says about the Ryan plan that kids with autism, Down syndrome and the elderly will have to quote, "fend for themselves." That's not what is in the plan.

    BOEHNER: That's not what is in the plan at all.

    Listen, Medicare is going bankrupt. The Medicare trustees have said, if we don't make changes, this program is going to go bankrupt and benefits are necessarily going to have to be cut. Nobody wants to see seniors' benefits being cut. And so, we've got to do something. OK? They don't like our plan. What is their plan? And frankly, their plan is to do nothing.

    HANNITY: Well, does that make it difficult that you have on the one hand, you got a cordial friendship. You can play golf. And then the president goes out and demagogues what you're representing at a really important time in history. You know, how do you compartmentalize that?

    BOEHNER: Well, it is part of the process. But where we are right now is that, you know, we are too close to the next election. You know, we just got through the last election. The president is I think spending too much time thinking about the next election. As opposed to doing what the country wants him to do right now, and that's to focus on the economy and jobs. And that's why dealing with this debt ceiling increase in a responsible way is critically important. Because it will bring confidence to business people in the United States. It will help create jobs, if we are willing to take on the big challenges that face us.

    HANNITY: August 2nd, we are told is the deadline. Now, we are expecting, and it was just reported today that Tim Geithner is going to come out and say, veterans' benefits are going to be cut. The elderly are going to lose their benefits. So, we are up on a real pivotal deadline here. Eric Cantor and Jon Kyl, Senator Kyl walked out of the meetings with the vice president. At this late hour, the president is getting involved. But it seems to be an issue, and tell me if I'm wrong, Democrats want to raise taxes to get us, you know, to get some cuts involved. Where are you with this?

    BOEHNER: No tax increases.

    HANNITY: Zero.

    BOEHNER: Zero. I've made it clear to the president, we are not going to raise taxes. You can't raise taxes on the very people that we expect to invest in our economy and to create jobs. Secondly, there are no votes in the Congress, in the House or in the Senate. There's not a majority to raise taxes on anyone. So, tax increases are off the table. And I'm not sure they've gotten the message yet. But, there aren't going to be any tax increases.

    HANNITY: Why would they keep pushing for it in these negotiations?

    BOEHNER: I'm just not sure that they've been dealing with reality.

    HANNITY: All right. Senator DeMint and Senator Hatch and in the House on your side, you have a lot of your caucus now likes the idea of cut, spending now, cap in terms of the amount of spending in the future. And a balanced budget amendment. You support that?

    BOEHNER: I do. And I think that it is important that we get real cuts and real changes in spending now. I've been a big supporter of the balanced budget amendment over my career. I've always voted for it and I will vote for it again.

    HANNITY: Is this reality? Do you think at this moment in history when the nation is focused on the debt, on record deficits, on very high unemployment, real unemployment, that you think you can get the president to go along with this, any indication that he might?

    BOEHNER: I don't know. But we've got a vote scheduled. I think Eric Cantor, our majority leader scheduled a debate and vote on the balanced budget amendment with limitations on the ability to raise taxes and limitations on the ability to increase spending. And I think that's coming a week of July 25th.

    HANNITY: Those limitations, to limit spending and raise taxes, would that be a super majority, two-thirds?

    BOEHNER: That's correct.

    HANNITY: And that sounds it'd be a big change.

    Look, the process of amending the constitution is difficult. But I'm wondering if this might be the time. Is this for you a main issue in terms of negotiation? I'm not expecting you to negotiate here on this program. But how important is that going to be as you sit down with the president, you have your discussions and what your caucus is willing to do?

    BOEHNER: Well, the president, yes, as you are well aware is not involved in any constitutional amendment. It has to pass the House and Senate with a two thirds majority then goes to the states. And I think it is important for the House to have this fight. I think the Senate is going to have the fight the week before we do it in the House. And it is going to be important that we get all the votes we can to try to demonstrate that this is possible.

    HANNITY: What happened, you met last Wednesday evening with the president? You haven't met with him since, right?

    BOEHNER: No.

    HANNITY: How did it go Wednesday?

    BOEHNER: We actually had a very honest conversation about the state of our economy. The fact that the Federal Reserve is -- they're out of gimmicks. The world economy is slowing. The debt problems in Europe are significant. And it is really important that we not miss this opportunity to make real changes. Real cuts in spending. Real changes to our long term structural debt problems. This is our real opportunity to address that. And I don't want to miss it.

    HANNITY: All right. What is more important, because there's going to be a lot of fear that the longer this goes on, as we get up to this August 2nd deadline, it's going to be a lot of fear out there. A lot of people are going to be talking about the full faith credit of the United States government and defaulting. What do you think would be worse if one is worse than the other, defaulting or not dealing with the structural problem? In other words, not sending a message to the world that we are serious about getting control of our debt?

    BOEHNER: Nobody believes that United States is going to walk away from its obligations. But I'm going to tell you, Sean, when I said this is the moment and this is the opportunity, it's exactly what I mean. Dealing with this debt problem and this deficit problem is far more important than meeting some artificial date created by the treasury secretary. We cannot miss this opportunity. If we want jobs to come to America, we've got to give American business people the confidence to invest in our economy. Today, they don't have that confidence.


    HANNITY: And coming up, more of my exclusive interview with Speaker of the House John Boehner.


    HANNITY: And welcome back to "Hannity." And here's more of my exclusive interview with the Speaker of the House John Boehner.


    HANNITY: What happened in the 2011 budget deal? Because when it was first announced, we heard it was $60 billion that you had cut. And then that number got reduced to 38 billion. And then by the time that was analyzed even further, it was down just hundreds of millions, and not even billions. What happened on that deal?

    BOEHNER: Well, that is not really true. The House passed $61 billion worth of cuts. I tried to do everything I could to get that enacted. The president wouldn't agree.

    HANNITY: Right.

    BOEHNER: What we did was, we got $38-and-a-half billion worth of cuts. That the Congressional Budget Office says, will save hundreds of billions of dollars over the next 10 years. And there's a lot of confusion out there about budget outlays versus expenditures. At the end of the day, it is all cash that was available for the government to spend. Pulling that back was the first step. And the fact is this, we are going to spend $79-and-a-half billion less than what the president wanted to spend this year. And that one third of the budget that we call discretionary pending. And the fact is, we're going spend $38-and-a-half billion less than we spent last year in that one-third of the budget.

    HANNITY: Then, why was that all the reports that kept reducing the original number?

    BOEHNER: Because people got in this debate over outlays versus expenditures and they confused people. But those are the facts.

    HANNITY: All right. Let me just run through. The CBO had some chilling numbers and conclusions that they came out with it. I just want to read a couple of things that they pointed out. We are headed for the most predictable economic crisis in American history. And Washington is not providing the leadership we need to avoid it. That's a frightening and chilling --

    BOEHNER: It is a very direct statement.

    HANNITY: Yes.

    BOEHNER: And coming from a government agency is even more remarkable. But we can't continue to spend money we don't have. We can't borrow 42 cents for every dollar the federal government is going to spend this year. A budget deficit of one-and-a-half trillion dollars. And according to the president's budget, trillion dollar deficits for as far as the eye can see, this is not sustainable. It has to be stopped. We took a small step earlier this year, now it is time for the big step.

    HANNITY: Let me just give this, maybe you can explain this to people in terms -- because I think we get into millions and billions and trillions and people get confused. The CBO projected the public debt is going to reach 70 percent of GDP this year. The normal historical average putting aside World War II is what, about 18 percent. Seventeen percent. And the other years, 11 percent, very, very low. Historical averages about 18, 19 percent. So, they predict by 20-21, 91 percent of GDP and then they predicted going to 101 percent. And then they predicted going to 200 percent by 2030. So, that means we are going to spend two times the amount we take in.

    BOEHNER: This is not sustainable. The American people know it. That's why I don't want and my team doesn't want this opportunity to escape us. It is time for the president to get serious about cutting spending now and making real changes so that the debt curve out in the future turns down dramatically.

    HANNITY: Even Greece, and we see what is going on there, is 150 percent of GDP. So, we are on this trajectory. The Democrats though have been using these tactics, predictable fear tactics. Medi-scare we call it. You know, how are you going to counter the predictable attacks against conservatives and Republicans by the president, he's already done it, and by the Democratic leadership?

    BOEHNER: Well, I don't know we want to outline the steps that we are going to take. But they are going to come. It is pretty clear to me that we are going to see the Treasury Department or the Social Security Department sending letters out, suggesting that you might not get your Social Security check next month. Or we may have to stop payments to Medicare providers, unless this debt ceiling is dealt with. It is predictable. It is going to come. What we've got to do is continue to press our case with the American people that cutting spending now and dealing with our long term debt will help create a better environment for job creators in our country.

    HANNITY: Last point in the CBO. They said, Medicare is unsustainable. Paul Ryan put forward a plan. Can you explain to people, how this won't impact, as the president said, kids with autism, kids with Down syndrome and the elderly, that they will have to fend for themselves. What is the plan?

    BOEHNER: What it does is give every American who is on Medicare the opportunity to choose a health care plan that fits their needs. Guaranteed issue. Nobody is going to be denied. And for most of the population, we will pay the full cost of that premium, if you will. Medicare recipients today pay a small premium every month. They will continue to pay that. But if you are wealthy and you've got substantial assets beyond your Social Security, we are going to expect you to actually pay the cost of your premium. But it is not going to affect anybody in the middle class or below. It will actually give you choices of a private sector plan that will actually cover more than what Medicare covers today.

    HANNITY: More, in other words, it will go to the states and the states will -- in other words that money will be allocated?

    BOEHNER: No, no. Just like the prescription drug plan that seniors have available to them today. They get to choose whatever kind of plan they want. They pay a portion of that cost. The government pays a portion of that cost. Why shouldn't Medicare have the same kind of opportunity where the private sector would actually offer these plans, in a variety of plans to seniors?

    HANNITY: What about Social Security, similarly it's headed for bankruptcy. Is means testing inevitable, raising the eligibility age, is that inevitable?

    BOEHNER: At some point it is. I would hope the president would deal with it. When I said everything is on the table, except raising taxes, I meant everything is on the table.

    HANNITY: Yes.

    BOEHNER: We know we've got long term problems in Social Security. We know it has to be dealt with. And the longer we wait, the harder it is going to be to make the changes necessary to assure that the program is sustainable. And there for those seniors who needs it.

    HANNITY: Pretty profound though when you think about it. We take in $2.2 trillion a year and we spend 1.65 trillion more than we even took in. It's almost double, we're spending double of what we take in.

    BOEHNER: Sean, I've been watching leaders for 20 years that I've been in Washington. Every year they look at this problem. And it's like, they look up at a mountain, they see how tall it is, and they see how steep it is and decide, nah, we are going to kick the can down the road another year. Well, guess what? We are out of road to kick the can down. Now is the time to deal with it.

    HANNITY: All right. Let me ask you this. One or two foreign policy questions. The battle, the president, the war powers act in Libya. And recently, you had a vote in the House saying, you know, what? You don't feel that there's a defined mission by the president. Explain why that vote went that way.

    BOEHNER: Well, I've never seen an administration act so precipitously when it came to engaging American troops on foreign soil. There was no consultation, there was no discussion, not with members of Congress, not with the American people. Next, you know, we've got troops flying missions in Libya. And so, there's a constitutional battle that's taking place here between the Congress and the president over the fact that there was no consultation. Was no authorization. Secondly, we get into this whole issue of, what is the mission? What is our goal here?

    HANNITY: He said, there were no hostilities.

    BOEHNER: Yes. Right. Well, nobody bought that nonsense at all.

    What is our strategic interests here? The plan is to protect innocent civilians and hope that Colonel Qaddafi goes away. Well, guess what? I asked the question, two days into this, Mr. President, what if he doesn't go away? I didn't get an answer.

    HANNITY: All right. Mr. Speaker, we really appreciate you coming in.

    BOEHNER: Sean, nice to see you.


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