CBS News - Transcript

Interview

By:  Nikki Haley Allen West Thomas Coburn Paul Ryan
Date: June 13, 2011
Location: Washington, DC

"Town Hall with Republican Leaders"

Participating were: South Carolina's Governor Nikki Haley, Florida Congressman Alan West, Wisconsin Congressman Paul Ryan, architect of the House budget plan, and Oklahoma Senator Tom Coburn

The event was hosted by "Face the Nation" anchor Bob Schieffer and "Early Show" co-anchor Erica Hill, with CBS News business and economics correspondent Rebecca Jarvis.

Erica Hill:
Hello and welcome to this special hour of the Early Show coming to you from the Newseum in Washington, D.C. Our focus this morning, the economy. A town hall with Republican leaders. Here to answer your questions, just as premi-- President Obama did in a similar event last month. I'm Erica Hill, along with CBS News chief Washington correspondent and host of Face the Nation, Bob Schieffer.

Bob Schieffer:
Hi, everybody. Well, we're here to talk with key Republican leaders this time about the economy. According to a recent CBS News poll, 79 percent of Americans believe the economy is bad. More than half of us are concerned about ourselves or someone in our household losing their job.

Erica Hill:
And unemployment, of course, is back above nine percent. Gas prices still around $4 a gallon in many areas. And across the country, there are signs of a double dip in the housing market. Major economic issues affecting millions of Americans. So, today, we've invited a cross-section of folks to ask Republican leaders what they can do to alleviate some of that pain. Folks have submitted their questions about the issues they find most important. And we'll also be hearing from viewers who sent their questions in on line.

Bob Schieffer:
So, basically, we know what the questions is, they don't. (LAUGH) But joining us are four distinguished Republican officials. Beginning with Congressman Paul Ryan of Wisconsin. He, of course, is chairman of the House Budget Committee and the author of the Republican budget plan.

Erica Hill:
Also with us, Florida Congressman Allen West and South Carolina Governor Nikki Haley, who were both elected in the Republican wave from the 2010 Midterm Elections.

Bob Schieffer:
And finally, Oklahoma Senator, Tom Colburn, who served with Congressman Ryan on the president's-- deficit commission. We want to say welcome to all four of you.

Various:
Thank you. Thank you for having us. (APPLAUSE)

Bob Schieffer:
Okay. So, let's get the-- let's get right to it. Our first question is from Trey Lewis. And this is for all four of you on the panel here. So, Trey?

Trae Lewis:
Good morning, everyone. There are many ways that people as though President Obama isn't using to stimulate and make the economy more robust. If you were in the position to do so, what would be the one thing you would do to stimulate and grow the economy that President Obama isn't doing?

Bob Schieffer:
Start Congressman?

REP. Paul Ryan:
One thing? (LAUGH)

Erica Hill:
Well, 30 to 45 seconds each. You can each have time to answer.

REP. Paul Ryan:
First of all, I-- I'd go in the opposite direction on spending, on taxes, on debt and deficits. Get rid of all the uncertainty in the economy. He's promising huge tax increases on successful small businesses. I wouldn't do that. Keep taxes low and get spending under control so we don't have a debt crisis. If we have a debt crisis and we have a huge interest rate increase. We have an inflation problem. That's causing uncertainty in the economy. It's making it harder for businesses to create jobs. So, I would go in a different direction than he has gone on fiscal policy. And that's exactly what we've done in the house. Is offered a different direction on fiscal policy. Keep taxes and spending low, not high.

REP. Allen West:
I think the exact same thing we Paul is talking about is creating the economic and fiscal policies that create confidence in the American consumer and also our small business owners. What I see down in my district is the-- small businesses are the economic engine that drive this country. But yet-- when you look at some of the regulations that are coming in and that's restricting the access to capital for them to grow. And you look at some of the tax policies which are gonna preclude them from hiring more Americans. When you drive by in South Florida on U.S. Federal Highway 1, you see all

those closed storefronts. You just have to think about maybe there were six to eight Americans that once occupied those storefronts.

Bob Schieffer:
Governor?

GOV. Nikki Haley:
You know what I would like to see this president do is really lead and asked for a balanced budget, which he has yet to do. And I think that's incredibly important. But from a governor's perspective, everything I've tried to do to govern in South Carolina has been stopped by President Obama. Whether it's how we're gonna deal with the health care crisis. He's mandating more on our states and we can't afford it. Whether it's creating jobs. He's actually got the National Labor Relations Board suing a great American company for creating jobs in South Carolina.

Or when it comes to illegal immigration, he's stopping my labor director from allowing her to enforce the laws that are in place. So, you know, the key is let the states have the flexibility and the freedom they need to have. In order for us to govern, which at the end of the day is really down to the states. The federal government needs to get out of the way. We need-- a president that really understands, let the state understand what the Tenth Amendment's all about. Let them have states rights and let them handle their states in the way they need to.

Bob Schieffer:
Senator?

SEN. Tom Coburn:
I-- I-- I think what needs to happen is we need to identify the real problem. And the real problem is America's anxious. It doesn't have confidence about where we're goin'. And that's, I think, a leadership deficit on behalf of my friend, President Obama. I think we need to talk (UNINTEL) and honestly to the American public about the depth of our problems. They're not unsolvable, but they're unsolvable until we address them and identify 'em.

And what Washington's big habit is is we treat the symptoms of the problem rather than the problem. And so, being honest and saying, "We don't have any choice. We have to eliminate $9.7 trillion out of the federal government's expenditures over the next ten years to not go in the tank. Now, they can dispute that, but that's the fact. And if anything short of that will not solve the problem for your future or your children's future."

There's $2.5 trillion sittin' on the sideline in this country right now that could be invested if people had confidence and clarity about the future. And I don't believe-- President Obama has delivered that. And I think as soon as he does, you're gonna see a big turnaround in the economy. Regardless of what we do on the other things. Is we've gotta have confidence that we believe in our future. And I think that future is lacking, because we haven't had the leadership to put-- put that forward.

Bob Schieffer:
Well, that certainly-- gives you the Republican view of what's wrong with the economy right now. So, that gives us--a place to start here. Erica?

Erica Hill:
A nice overview. We want to move on to our next question now. Nancy Logan's an executive assistant who's currently between jobs. And chances are Nancy may look familiar if you were with us at last month's town hall. She was here. She asked the president-- pretty much the same question. So, your chance now to ask it of Republican leaders.

Nancy Logan:
Thank you, Erica. Hello. I was given a three-year adjustable rate loan modification that ends in less than a year. And the rate is likely to go up significantly, where I won't be able to afford my monthly mortgage payment. I can't refinance my house or move in-- move into a fixed rate mortgage, because I owe more than the house is worth. My question is, what is your party in Congress doing to help Americans like myself who are stuck in this home mortgage process dilemma.

Erica Hill:
And we want to toss this one to Congressman West, because I know in Florida, I believe, it's 46 percent of homes are under water.

REP. Allen West:
Yeah, if-- it's an incredible situation down in Florida, where, of course, the subprime mortgage industry really--took a toll. And I think the most important thing that we have to do is from the policies we're creating up here is set the conditions by which we can reduce the size and the scope of this federal government to get money back into your pockets. So that you can stay into your home. So that you can have this job growth.

I think that one of the problems that we have seen, if you go back and you look at the Community Reinvestment Redevelopment Act, you know, when government all of a sudden got involved into the mortgage industry, I mean, soon or later, 30 years down the road, well, you see what happens. When all of a sudden we start to take those-- those mortgage-backed securities and we're selling them freely between banks and also to form banks, then we have all this bad paper out there.

So, I think the most important thing is get back to sound economic principles that work. And not come up with the band-aid-- remedies like this $8,000-- mortgage credit that we give, which we saw really did not do anything to stimulate the-- the mortgage industry.

Bob Schieffer:
Senator-- I mean, Congressman?

REP. Paul Ryan:
Well, I'm gonna say like Tom Coburn said. Why is this happening? It's happening because the economy's in the tank. There's no confidence. People don't feel confident about the future. So, they're not going out and taking a risk and buying a home and therefore bringing your home value up.

So, this is a symptom of a bad economy. So, let's fix the economy. And there's a lot of things I hope we can get into about what is necessary to get this economy growing. Because Washington's throwing a bunch of programs at you. And it's still not working. It's cost a lot of taxpayer liability. There's no substitute for economic growth and confidence in this economy to bring that market back up so you're not under water any more.

Bob Schieffer:
All right. Let's go-- to-- Robert Johnson. Who has-- I think a fairly interesting question here. Mr. Johnson?

Robert Johnson:
Thank you, Bob. Good morning. There's a lot of agreement that we need to balance the budget and reduce the deficit. How realistic are we in achieving those goals if we do not reinstate or raise at least some taxes?

Bob Schieffer:
I want to ask-- Senator Colburn to ask that question, because Senator Colburn voted against the continuation of the Bush tax cuts last December. Kind of got the Republican reservation there. He wanted them offset. So, should taxes be off the table, Senator Coburn?

(OVERTALK)

SEN. Tom Coburn:
No, I don't think so. Look-- there's two answers to your question. One is a policy question. And the other's a political. How-- how do we with the divided government we have today fix our problems without agreeing that we're gonna have to give something to get what we want. And growing the economy to markedly enhance the revenues shouldn't be anathema-- anathema to--to Republicans.

So, if in fact we need to do all these spending reductions-- and I'd love for us to have time to really talk about it. Because I can-- I can give you $8 out of the $9 trillion I'm gonna propose. But if we're gonna do it, you're gonna-- for those that are locked in politically to those programs, you're gonna have to give 'em somethin'. So, we-- we're at historically low re-- values, as far as the percentage of the G.D.P. that comes from revenue from American taxpayers.

That's part of our problem. We're also at a historical high, in terms of spending. That's the bigger part of our problem. What we have to do is pull those both together. If we're gonna get back to it. The-- 18.8 percent is about the max you're ever gonna collect, unless you have a boom like the-- the dotcom bubble. But we need to solve that political problem and be realistic to know that for us to get a solution to the problem, both sides are gonna have to give something.

Now, what's the policy question? The policy question is is how do you drive the economy with the government taking a larger and larger share out of the economy? And the answer to that is is eliminate things that are not legitimate roles for the federal government. Going back to the question of homes. Where do you find in the Constitution the authority for the federal government to be in the home loan business?

I mean, it's not there. And the reason we're at risk today, the reason our children are at risk, is because we've abandoned constitutional principles. We've abandoned the enumerated powers. And we've decided to do things that our founders in the--in our best interest would never work in terms of a republic.

Bob Schieffer:
All right. We're gonna take a break here.

Erica Hill:
(UNINTEL) we're gonna take a quick break. But there will be more. Don't worry. Our town hall on the economy continues. With more questions from our studio audience and also from you at home. Stick with us. You're watching the Early Show on CBS.

Erica Hill:
We are back now with our panel of Republican leaders. Senator Tom Coburn, Governor Nikki Haley, Congressman Allen West, and Congressman Paul Ryan.

Bob Schieffer:
And we want to bring in our CBS News--business and economics correspondent, Rebecca Jarvis, who is following the questions we have been getting online. Rebecca?

Rebecca Jarvis:
Bob, thank you. And this first question comes from Facebook. It was submitted to us from Suzanne Thornton of Cushing, Texas. And she asks, "Under the Democrat president, Clinton, we had a surplus. Under a Republican president, Bush, it disappeared and turned into a deficit. So, why should we hand our country back over to Republicans?" Governor Haley, why don't you take this one?

GOV. Nikki Haley:
You know-- I think what we first have to understand is both parties made a mistake. I mean, both parties did not handle the government responsibly the way they should. We have got to--and-- and in reference to what the Senator said, we do have to cut taxes. In South Carolina, we have an economy where I have basically said, "Government was intended to secure the rights and freedoms of the people. It was never intended to be all things to all people."

So, what we did was we said, "This is gonna hurt, but we're gonna get back to the basics. And we're gonna get strong again. And we're gonna do it independently of the federal government." And a lot of that is we are cutting unemployment taxes for employers. We are cutting down the weeks for employees on what they get in terms of unemployment taxes. But we are incentivizing those that are successful to want to be more successful.

And we have to remember that when you give businesses cash flow, when you give them profit margins, what's the first thing they do? They hire people. So, your goal has to be on jobs. It has to be on job creation. And it has to be on the fact that when you know both parties have messed up, guess what that brought about? The rise of the Tea Party, which were upset with both parties. That said, "We want to take our government back. We're gonna do it. Now it's government's responsibility to control the spending and know the value of the dollar."

Bob Schieffer:
Governor-- can I just ask you this question. Corporations are-- are turning in record profits right now. But they don't seem to be hiring. So, doesn't that-- beg the question here, "Why aren't they hiring? With-- with all these big profits coming--"

GOV. Nikki Haley:
Well, you know, I'll tell you-- I'm proud to say that while the economy is taking a downward turn-- nationally, in South Carolina it's going up. And the reason it's going up is because unemployment's down for the fourth time in the row. They have a governor that's fighting for jobs every day. We just passed TORT reform. We just passed Medicaid reform. With just passed that every legislator had to start voting on the record. I mean, we're doing things that are giving companies confidence.

Confidence one to come to South Carolina. We are fighting the unions every step of the way. We are a strong right to work state. We're gonna stay that way. That's what gives a company confidence to come and say, "This is a state where we can make money. This is a state where we can invest and know that we're right to hire." And then they say in-- you know, and then they come to stay. And my job as governor is to continue to keep communication with those companies and say, "How do we help you expand?"

Rebecca Jarvis:
Representative Ryan, a lot of Governor Haley's response talks about jobs. And jobs are top of mind for Americans. The most recent CBS News poll showed that 48 percent of Americans think the most important thing is jobs and the economy. But just ten percent think it's the deficit. That's what we mostly hear from Republicans. We hear more about the deficit than we hear about jobs.

REP. Paul Ryan:
Well, I wouldn't suggest-- they're interrelated. These are the same issue. So, they're not exclusive of one another. Jobs comes from economic growth. Economic growth gives us more revenues, which helps us get down the deficit. The huge deficit we have is nothing more than tomorrow's interest rate increases or tax rate increases.

So, when government runs huge deficits, like it is today, what that tells businesses who are sitting on capital and not hiring, "Look out, my taxes are gonna go up tomorrow or we're gonna have an inflation interest rate problem tomorrow." And so, it is these massive deficates-- deficits that are showing businesses that there's an uncertain future, an uncertain future with which they don't want to invest in.

And that is why a lot of businesses are-- sitting on capital. I had a roundtable in Kenosha with business leaders last Thursday, (UNINTEL) two hours ago with business leaders. All of them are telling me the same thing. "We don't know what's coming from government next. So many new regulations coming down the pike."

(OVERTALK)

Rebecca Jarvis:
--coming from the consumer, though. There's no consumer demand for a lot of their products.

REP. Paul Ryan:
Say that again?

Rebecca Jarvis:
They don't know what's coming from the consumer. The demand that's coming from American consumers is very weak, at this point. Which is why they're not creating the jobs to sell the product or to manufacture it.

REP. Paul Ryan:
Consumption comes when people feel secure in their own lives. When people have jobs that they are-- that they--they feel secure in. When they're not worried about losing their job. You need to have a good economy that is producing jobs and giving security, economic security to Americans, who then will go forward and act like consumers.

And so, what we have right now is a government that is giving so much uncertainty, tax rates on successful small businesses under the President's plan, which is in law, is going as high as 44.8 percent on successful small businesses. Most of our jobs don't come from the big corporations. They come from these successful small businesses. And when we're gonna be raising their taxes as much as President Obama is proposing, that puts a chilling effect on job ncreation.

When we raise and borrow all this money, 42 cents out of every dollar coming out of Washington, it's borrowed. 47 percent is coming from other countries like China. This is not a future in which people, businesses or consumers, feel confident in the American economy. We gotta deal with these issues, so we can feel confident and get this job creation back on.

Rebecca Jarvis:
There's-- there's obviously a vicious cycle here. And it doesn't help--

REP. Paul Ryan:
That's right.

Rebecca Jarvis:
--that the U.S. economy is absolutely a consumer-driven economy. You talk about the importance of confidence. You talk a lot about small businesses. But going back to large businesses who are sitting on this cash.

REP. Paul Ryan:
That's right.

Rebecca Jarvis:
Isn't one of the major issues also that they have learned how to do more with less. And it is not in their interest to hire people. Is there any way you can change that?

REP. Paul Ryan:
Well, first of all, predictability. I think large businesses-- first of all, we're in the international economy, whether we like it or not? And we have to recognize, if we tax our employers, our producers a lot more than our foreign competitors tax theirs, they win, we lose. Right now, we have the highest corporate tax rate now that Japan is lowering theirs than any other industrialized country.

Right now, we are taxing our businesses, our manufacturers in America, a lot more than our foreign competitors tax theirs. And what is the government telling them? "You're gonna pay higher taxes." What is the government doing? Running up record deficits that mean even higher taxes. So, even though the president's proposing over $2 trillion in new tax increases on these businesses, we still aren't solving our fiscal problem and it's putting a chilling effect on hiring.

So, you're not gonna get good consumption in this country if you don't have good investment, if you don't have confidence, if you don't have businesses out there not only keeping people on the payroll, but adding to their payrolls. And so, we're in a vicious cycle and we want to get on a virtuous cycle.

Erica Hill:
All right, we're gonna have to stop this cycle right now. Because we need to take a quick break. (LAUGH) When we come back, though, we do have several more questions to get to. So, stay with us here at the Early Show.

Bob Schieffer:
And still ahead more of your questions for our panel of Republican-elected officials, as we continue a CBS News town hall on the economy.

Erica Hill:
This is the Early Show on CBS. Your local news is next.

Erica Hill:
Welcome back to this special hour of the Early Show. A town hall on the economy, the Republican view.

Bob Schieffer:
Joining us-- Senator Tom Coburn, Governor Nikki Haley, Congressman Allen West, and Congressman Paul Ryan. And next--we have a little question about taxes. Senator Colburn, I'm gonna ask this one be directed to you and it comes from Crystal Grant.

Crystal Grant:
Greetings. I'm originally from Boiling Springs, South Carolina. So, greetings to you, Governor Haley. My question is about compromise. With low and middleclass Americans making sacrifices every day and the deficit growing exponentially, it seems difficult to justify tax breaks for millionaires and billionaires. Are you open to considering-- maybe tax-- returning to previous levels for those making over $500,000 a year versus a $250,000 level?

SEN. Tom Coburn:
Well, I-- I think my-- my approach would be we've gotta find a compromise. I don't like that. Because-- when you-- when you do that, what you're doing is taking investment capital that's not gonna go into a small business or a medium-sized business. You're-- you're taking capital away and saying the government can spend the money better. The-- the fact is is if we were to lower tax rates we could actually generate increased revenue.

And that's what we had proposed, in terms of the president's deficit commission. That's what the gang of six was working on. You know, we-- we can increase taxes a trillion dollars by lowering tax rates and gettin' rid of things like the ethanol blenders credit that you all pay $6 billion a year for and then go to the pump and pay another Hun-- $1.72 a gallon in subsidies for ethanol-blended gasoline. I mean, we have a trillion dollars worth of tax earmarks in the tax code that are special favors across-- and some are not, but the vast majority are special favors.

We ought to eliminate those, lower the tax rate, so people can have the confidence and the expectation that they know what they're gonna pay. So, I'm not against increasing the revenues of the federal government. But I-- we ought to do it in a way that actually increases jobs and increases wealth and increases prosperity. But combined with that, you have to decrease the size of the federal government. The size of the federal government is double what it was ten years ago. We just simply can't afford it.

I mean, you-- you just said, in your statement, you have to live within your means. And the federal government has refused to do that. And-- and we're incompetent in Congress to address the issues. A couple examples, if I can take some time. We have 80 economic development programs-- we have 188 total. We have 80 within four agencies. Not one of those economic development programs has had-- ever had a measurement on it to see if it was actually effective in developing ec-- the economy. Not one time have we ever looked at it.

And the cost-- for that money, that's $6.6 billion that goes for that. We don't know what-- wouldn't we be better off having that $6.6 billion in the states like Governor Haley. And say, "Here, do economic development with the money the way you think you ought to do it, rather than us in Washington, where we don't actually know how to do it."

Bob Schieffer:
What would be your take on that, Mr. West?

REP. Allen West:
Well, I think it's very simple. And--and understand, four years ago, I was sitting in a desert and Kandahar, Afghanistan. So, I bring a very common-sense perspective. And being in the military is-- is simple. You know, we don't reinforce with additional resources where we're gonna lose those resources. And so, I think until we up here in the federal government can show that we can be fiscally responsible with the resources of the American taxpayers. Then we should not be asking to-- to get increased resources.

See, one of the problems is when you have tax cuts, but then you grow government, that's how you take a surplus, you turn it into a deficit. But it's not just the tax rates. It's all of the additional taxes that make up a marginal tax rate. So, the next thing you know, you've got the dividends tax, you've got your capital gains tax, you've got your estate tax. You've got all of the other taxes you may have at the state level, even down at the local level. And now what we're talking about is a marginal tax rate for people that can be anywhere from 60 up to 70 percent.

And even when John F. Kennedy took over as president, and he saw a marginal tax rate on those top-- income tax brackets of 91 percent, he said, "That's too high." And he cut it down to 71 percent. So, when you're talking about growing the economy, once again, investment, ingenuity, and innovation does not come from Capital Hill, does not come from Washington, D.C. It comes from the people down here.

And we have to set those fiscal and economic policies that promote that. And we have to get spending in line with revenues. 18 to 20 percent. That's where it is. We need to cap that federal government spending at about 20 percent. Right now, federal government spending, as per G.D.P. is 25 percent. And with the Obama budget, it's programmed to go above 30 percent. And you cannot continue to go on that path, if you want to have long-term, sustainable economic and job growth.

Bob Schieffer:
Let me-- let me ask you-- the three members of-- of Congress here, you've been here since January. The best to my knowledge, you've done absolutely nothing. There's no jobs program. You've got unemployment at 9.-- 1 percent. Why is that?

REP. Paul Ryan:
Well, we have divided government now. First of all, what happened the last two years--

Bob Schieffer:
Well, there's always been divided government.

(OVERTALK)

Bob Schieffer:
Well, (UNINTEL) jobs program is a trillion dollars when you add the borrowing cost in stimulus. Remember what stimulus was supposed to do. It was supposed to keep unemployment from going above eight percent. We're at 9.1. We went as high as 9.8 percent. What else happened? Our tax increase, $800 billion in tax increases with the president's health care law. The health care law passed, which is basically the government taking over 17 percent of our economy.

We've got new energy regulations coming through, putting a chilling effect on American-made energy to lower our-- our gas prices. And so, with so much has come from the government in the last two years, I believe that that is a gre-- greatest reason why the economy's not growing. What have we done since January? In the House of Representatives, where the two of us work. We've passed a budget to reform this tax system, make people take away tax shelters from higher income individuals in exchange for lower tax rates (UNINTEL) businesses to create jobs.

Bob Schieffer:
Congressman, not to be argumentative, but you passed something that you knew there wasn't one chance that the Senate was gonna chance.

REP. Paul Ryan:
Well, it would be nice if the Senate tried to pass a budget. It's been 775 days since the Senate even bothered trying to pass a budget.

Bob Schieffer:
But wouldn't it be good to try to find some way to compromise on these--

REP. Paul Ryan:
That's why we've said--

Bob Schieffer:
--things to kind of get the people at the same table and say, "Here's something we want to do. Here's something you want to do. Instead of passing these things that people know will never get agreed to by the other house."

REP. Allen West:
Well, I'll give you another great example. Our office came up with HR-16-63. Which is the-- Small Business Encouragement Act. And what it says is in the previous fiscal year, if you're a small business that has revenues of $20 million or less. You have $100 employees or less. We're talking about extending the work-- opportunity tax credit for 2012 and 2013 which says we'll give you $6,000 if you hire a person off the unemployment rolls.

And if you're in a county that has a double-digit unemployment rate, you get an additional $6,000. And now those are the type of things we're looking to do to help small businesses get out there, encourage them and incentivize them to hire people. It's sitting in the Ways and Means Committee. And-- hopefully, they'll get it passed and we'll get it in the House floor and then we'll get over to the Senate. And hopefully they-- they'll pass that and it'll get on the president's table--

Bob Schieffer:
Senator?

REP. Allen West:
--before we recess.

SEN. Tom Coburn:
Well, I think-- Bob, I think what you're describing is-- is a system of the careerism that has invaded and

perhaps been here a long time. The goal is the next election, not the next generation right now in Washington.

REP. Paul Ryan:
Absolutely.

SEN. Tom Coburn:
It-- we're more interested in political careers than we are fixing the very real and urgent problems in front of our country. The Senate has-- this is the lowest level of votes the Senate has had in my seven years and the lowest level of votes in 25 years.

And the reason we're not voting is people don't want to take a vote, because they might have to defend it. So, rather than come up here and do the job and have the courage and the honor to go out and defend your votes, what we do is we just don't vote.

Erica Hill:
How do you change that? How do you change that, Senator.

(OVERTALK)

Erica Hill:
But leadership-- leadership continues--

REP. Paul Ryan:
We've put ideas on the table.

Erica Hill:
--to change.

REP. Paul Ryan:
We've passed ideas in the House. We've said, "Here's how we think we balance the budget. Here's how we save Medicare. Here's how we create jobs." We're putting these bills out there. We're passing these bills, because we think you need to do is lead with your ideas, defend your ideas. And what we're having is basically the crickets are chirping. We're not seeing any action from any of our legislative partners on the other side of the aisle.

Bob Schieffer:
Governor Haley ca-- looks like she'd like to comment here.

GOV. Nikki Haley:
I have to say this. Because while--

Bob Schieffer:
From outside Washington.

GOV. Nikki Haley:
While D.C. is-- is totally-- in chaos. And has-- (LAUGH) is just-- not doing anything. The states can't wait. We have to lead. And so, what I would beg of both the Congress and the Senate, which I think everybody should agree on is give us flexibility. Quit mandating any expend-- any spending down. Medicaid alone is a quarter of South Carolina's budget. Give us the ability to decide what the health care needs are of our citizens. When it comes to any education mandates, let us decide how to educate our kids. When it comes to any of the health care, let us decide our health care. And (UNINTEL) and Medicaid is huge for us.

(OVERTALK)

GOV. Nikki Haley:
--and I know that the Congressman has done that, as well. And-- and they've been helpful, these are things that can really make a difference. So, you know-- I have said D.C. is just dysfunctional right now. But all I would beg is that those things can be done right away. Those are things that y'all could pass hat would make a huge difference with our states. That we could continue to function and lead for our people, while y'all figured everything else out.

Bob Schieffer:
Let-- let me just ask Senator Coburn to wrap this up. 'Cause I think he hit the nail on the head here. Is there any way to change this, Senator? I mean, will we sill a change in our lifetime?

SEN. Tom Coburn:
Yeah, I think American people need to change it, though. I-- I'm convinced--

REP. Paul Ryan:
That's why we're here.

SEN. Tom Coburn:
--that Washington is-- its main focus is short-term political expediency. And the reason our country's at risk is because we think short term and about the next election, rather than thinking about the future of our country. You know, the reason I'll stand up as a conservative Republican, one of the biggest deficit (UNINTEL) in Congress and say, "I'll negotiate on taxes." Because our country's in trouble.

And if we don't, we're gonna lose the very limited future that's in front of us today and somebody else is gonna tell us where we're gonna spend our money. It isn't gonna be the American people. It's gonna be the bond holders throughout the world.

Rebecca Jarvis:
So, Senator Coburn, do we go the direction, then, of the United Kingdom and employ austerity measures and face, potentially, a toxic environment. That's what the Bank of England just said. A toxic environment where there's slow growth and inflation, taking place at the same time?

SEN. Tom Coburn:
No, you do both. You do both. There's no question if what-- first of all, every dollar the federal government spends doesn't give the same bang in the-- for the buck in the economy. And I can show you about $5 trillion that gives us a negative return on the dollars that we spend. So, if we're gonna spend money as a federal government, then we ought to be spending it where we get an economic multiplier of $2 or $3.

The problem with the stimulus bill, there was only $46 billion out of almost $900 billion that actually had any productive change in terms of economic multiplier in the whole stimulus bill. No wonder it failed. We said it was gonna fail. Because it did not create jobs that then created more jobs. So-- this isn't hard. What-- what is hard is to come to the realization that career politicians in this country are killing this country.

Erica Hill:
We-- and with that, we actually have to move on to the next topic. Although we could talk about this for a long time. And this comes from Leslie who's in our audience. Leslie has a question about Medicare.

Leslie Siddeley:
Hi there. I'm 48 years old. So, I'm in the age group that would be impacted to the changes to the Medicare program under the so-called Ryan Plan. I'm also the caretaker of an elderly parent. It's common in my age group. How can I be certain that Medicare will be affordable for me when it comes time for me to retire? Especially considering I've been paying in for 30 years.

REP. Paul Ryan:
I'm the Ryan guy. (LAUGH) I guess I'll answer the question. A few facts that are not in dispute. Fact number one, we have 10,000 baby boomers retiring every day and fewer workers coming in to pay taxes to pay for the program. Fact number two, health care costs, they're skyrocketing at about four times the rate of inflation, which is threatening Medicare's current ability to provide affordable accessible care.

Fact number three, all the independent ex--experts agree, Medicare's going bankrupt. Medicare along with Social Security, I would argue, are the most important federal programs we have. And so, what we want to do is save and strengthen the program. Here's what we say. Number one, if you have retired already or if you're 55 and above and you're about to retire, government made a promise to you. We should keep that promise.

So, we say, "Don't change the program for anybody above the age of 55." But in order to be able to do that. In order to cash flow that promise, prevent that bankruptcy from hitting my mom who's on Medicare. You know, my mom and I took care of my grandmother when she was on Alzheimer's on Medicare. It's very important to me, personally, as well. You've got to fix it for the next generation, if you want to keep it for the current generation. And the way in which we propose to fix it for 54 and below are to have a system that works like the one we have in Congress.

Like the one that President Clinton's bipartisan commission to save Medicare proposed in the late 1990s. It's an idea that's had bipartisan support in the past. It's called premium support. It works just like Medicare Advantage today. Medicare prescription drugs. Medicare supplemental. You get a list of plans that Medicare preapproves that are guaranteed coverage options that you select from.

These plans compete against each other for your business. And then Medicare subsidizes that plan based on who you are. If you're a wealthy person, we don't think tax payers should subsidizes their health care as much as everybody else. If you're a lower income person or if you're a person who keeps getting sicker, we think we should have increased subsidies. And so, what we say, is starting for the 54 and below crowd, when they turn 65, is take what we spend per person on Medicare, apply it to these people and adjust it like I said. Less for the wealthy, more for the poor and the sick, so that they can

have plans to choose from and use choice and competition.

Here's the alternative. The president passed a law, it's in law, Obamacare, I know people don't like it being called Obamacare. The current health care law raids half a trillion dollars from Medicare to spend on this new health care law. And then it puts a board of 15 unelected, unaccountable bureaucrats in charge of cutting Medicare for current seniors through price controls, which will lead to providers dropping care, which will lead to rationing, which will hurt the actual program for current seniors.

We repeal the rationing board. We repeal the raid of Medicare. We think Medicare funds should go to Medicare, not other programs. How many times have you heard that since Social Security? And then we save it for the next generation, so that we can cash flow the promise and keep it for the current generation. So, when you turn 65, you'll have a program that will be there for you. At--at the rate-- at the age you are, 48, I'm not that much younger than you. It's not gonna be there for us if we don't do anything to save it.

It is going bankrupt. The sooner we act on this, the better off we are. And the more gradual the necessary reforms are. It will be British austerity. It will be painful benefit cuts to current seniors, tax increases on everybody like young people that slows down our economy, if we keep kickin' the can down the road. And it is a political careerism around here that has put is in the mess we are in. And you need leaders to step up and stop doing this.

We put a plan out there. I don't expect everybody to like the plan. But at least we put a plan out there. And I would love to see our partners on the other side of the aisle put their alternative plans out there, so we can get to the business of actually solving this problem.

Bob Schieffer:
We need to kick this can over to Rebecca for the next-- (UNINTEL) Rebecca.

Rebecca Jarvis:
Well, we have a question from Brian Olfey, from Post Falls, Idaho. He sent it via email. He says, "Considering the fact that the U.S. Government is the nation's largest employer, how do you expect to cut $2 trillion from the budget without sending the jobless rate through the roof?" And-- Representative West, why don't you take it?

REP. Allen West:
I think it's important for us to-- as we say, we gotta get back to understanding what are the essential functions of the federal government? One of the questions I asked when I got up here, 'cause I'm a newbie, I've been here since the 5th of January. Never held any type of public office before. But it's-- once again, it's a common-sense approach. It's a very disciplined approach that the military-- teaches you. 13 appropriations bills come out of the--the House of Representatives. What's the priority? No one could answer that.

And that's why I wrote a letter over to the House Appropriations chairman-- Hal Rodgers. Why don't we have a tiered progress-- program so that we say, "These are the priorities." And then we can understand from the bottom up. We can start to refine. We can start to cut. And get the federal government back into its essential functions. So, I think that, you know, we can have this bureaucratic

nanny state. That grows up here in Washington, D.C.

And if you continue to have that, you're gonna continue to have the separation between the revenues that are coming in and the spending that is going out. And so, what we've seen in the past three years, $1.42 trillion. $1.29 trillion. And now $1.65 trillion of deficits. So, we have to make the hard decisions up here. And I think that's one of the reasons why persons like the governor and myself, we're not career politicians. And we're bringing a perspective that is totally different and outside of the beltway.

Rebecca Jarvis:
Coming back to the question--

(OVERTALK)

REP. Allen West:
--we've got to make a change.

Rebecca Jarvis:
Coming back to the question, though, of jobs. We are facing a new reality. We are a facing a reality--

REP. Allen West:
Government does not create jobs. The private sector creates jobs. And if we continue--

Rebecca Jarvis:
And we are looking at--

REP. Allen West:
--to-- if we continue to--

Rebecca Jarvis:
--a private sector right now that's not doing it.

REP. Allen West:
You're not--

(OVERTALK)

Rebecca Jarvis:
They're shipping them overseas.

REP. Allen West:
--conditions for the private sector to grow. You're not setting the conditions.

Rebecca Jarvis:
Well, let me tell you what the conditions are--

(OVERTALK)

REP. Allen West:
--business tax rate of 35 percent. The highest in the world. Who is going to be able to create a job in the United States of America, bring production and manufacturing back to this country, if you're pushing them away?

Rebecca Jarvis:
Well, Ford Motor Company, for example--

REP. Allen West:
Ford Motor Company did not take--

Rebecca Jarvis:
--is creating jobs.

REP. Allen West:
--any bailout money and they created jobs.

Rebecca Jarvis:
Exactly. They are.

REP. Allen West:
Great company.

Rebecca Jarvis:
They're creating 7,000 jobs here over the next two years. But they're also building a third of their cars and producing a third of their cars for the Asian market by 2020. That means the market is changing, the world is changing. People overseas are the primary customers of U.S. businesses.

REP. Allen West:
Absolutely. And that's why--

Rebecca Jarvis:
If they are building cars for foreign counterparts, why aren't they building them in foreign countries? That's exactly what they are doing. How do you work against fate?

REP. Allen West:
Well, I don't think we're working against fate. I think the thing is once-- I look at the Panama Canal. The Panama Canal is gonna be expanding in 2014 to bring in larger cargo ships. We happen to have a little thing in my district called Port Everglades, brought in $98 billion of revenue last year. I've already had meetings with the-- senior representative from Hong Kong and also--Consular General from Taiwan who want to have increased trade and increased revenue comin' out of South Florida with small business owners.

Those are the type of things we're looking to do. How can we increase our production, our manufacturing, our export to some of these foreign markets. But right now, we don't have the right type of economic and fiscal policies. It comes back to the one word we keep saying over and over again. Certainty.

GOV. Nikki Haley:
Well, I-- I think we've missed talking about the fact that the National Labor Relations Board, when you've got a president that allows the National Labor Relations Board to actually sue an American company for creating jobs, you are actually incentivizing companies to do business overseas. That was huge. And that is right at the heart of what we're saying. If we have to create jobs, government can't be the one stopping them.

I mean, President Obama can't say on one side, "I am for job creation." And on the other side, sue one of the companies that is trying to create thousands of jobs. They created a thousand jobs in South Carolina all while expanding 2,000 more jobs in Washington. And they still sued them. That sends a terrible message to our companies. And a terrible message-- when I was at the U.S. Chamber of Commerce, we had a Canadian company that said, "I'm not doing anything until I see what happens with this lawsuit."

Erica Hill:
We're gonna have to leave it there. (LAUGH) Stay with us, though. We'll be back again in just a moment.

(OFF-MIC CONVERSATION)

Erica Hill:
We are back with time for one quick final question, a yes or no if you can. Do you believe the debt ceiling will be raised?

REP. Paul Ryan:
I do believe so, if for every dollar of borrowing, we cut more than a dollar's worth of spending.

REP. Allen West:
Not without spending control measures.

GOV. Nikki Haley:
Only with deep spending cuts and spending caps going forward.

SEN. Tom Coburn:
I agree with the governor.

Erica Hill:
Okay. There's not a yes or no in any of those answers. (LAUGH)

REP. Paul Ryan:
Yes, but. Yes, but.

Erica Hill:
But they were all short. And we appreciate that. We appreciate all your time today.

Bob Schieffer:
Thanks to all of you.

Various:
You're welcome. Thank you.

Bob Schieffer:
Very, very interesting. We all learned a lot. Thank you.

Erica Hill:
Our panel again. Congressman Paul Ryan, Congressman Allen West, Governor Nikki Haley, and Senator Tom Coburn.

Bob Schieffer:
And thanks to our studio audience out there. And our host, the-- night studio at the Newseum here in Washington.

Erica Hill:
If you missed any bit of it or maybe you'd just like to see it all again, you can view the entire town hall at YouTube.com/CBS or on our website at EarlyShow.CBSNews.com. And also be sure to log on to CBSNews.com for a special Washington unplugged with reaction from our town hall. Have a great day, everyone. Thanks for being with us.