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And here in Washington, a member of the Republican leadership, Roby Blunt of Missouri.
Senators, welcome back.
SEN. ROY BLUNT, R-MO.: Good to be here.
WALLACE: Before we start, let's talk about the big differences between the budget that the House has passed and the Senate has passed. Let's put them up on the screen.
The Senate calls for $975 billion in new taxes. The House has none. The Senate cuts 2.7 -- rather, $275 billion from health care, mostly from Medicare providers. The House cuts $2.7 trillion by repealing ObamaCare and changing Medicare to a voucher system. Overall, the Senate budget is $91 billion more.
Senator Blunt, big differences there. Is there a deal to be made?
BLUNT: I think there is an agreement to be made here. But, you know, what we should have learned in the last couple weeks is, if you're in a divided government, and you're arguing against the law, you're disadvantaged. And one of the -- that number that the House used actually is the number that the law ultimately will enforce if we don't reach some agreement to moderate that.
WALLACE: The sequester --
BLUNT: The balance of the Budget Control Act is the only thing we found that actually controls spending. This is the second year in the row and the first time since the end of the Korean War that spending has gone down at the federal level two years straight.
The Budget Control Act is there. Senate Republicans, I believe House Republicans, are very supportive of that.
And whatever kind of agreement we make -- entitlements, savings, versus some additional spending -- I think has to be done with the understanding that at the end of the day, if we don't make an agreement, the number is going to be $967 billion in discretionary spending.
WALLACE: Well, let me pick up on that with you, Senator Durbin, because as Senator Blunt suggested, Republicans have some leverage here. If nothing happens, the sequester spending cuts kick in on January 15th and discretionary spending is cut by $21 billion.
Paul Ryan, the House Budget chair, is proposing a kind of trade in which they would agree to some short term spending increases which you guys want, in return for some long term spending cuts to entitlement reform.
Does that sound reasonable?
DICK DURBIN, D-ILL.: Well, I can tell you this -- if this is the bargain that the Republicans are now pushing for, that we have to cut Medicare to avoid cuts in the Department of Defense, they ought to step back and take a look at this. Paul Ryan couldn't pass his budget in the House of Representatives. The Republican majority wouldn't vote for it unless he violated the Budget Control Act, and added more than $20 billion in defense spending.
We ought to sit down together and realize that sequester is the clumsiest, most awkward, ham-handed way to cut spending. We can do it much more sensibly.
And I think we can meet our spending targets. We can reduce the impact, the negative impact of sequester on our national security and national defense.
WALLACE: Well, then, let me ask you -- you know, and don't get into the weeds on me here -- if they were willing to relax some of the short term spending cuts for Defense and domestic programs, what would you give them?
DURBIN: Well, I'm going to leave that to Senator Patty Murray. I'm not going to negotiate here on FOX. Patty Murray is the chair of our budget committee.
I respect Paul Ryan. We disagree on politics and certainly on issues like the future of Medicare. But when it comes down to it, we've got to be able to put everything on the table. That means Republicans have to be willing to put revenue on the table.
I just can't understand this basic premise that this tax code is sacred. That there aren't loopholes in there that should be closed and the savings be dedicated to reducing the deficit.
Why is that such a radical idea to most Republicans?
WALLACE: Well, it raised its head (ph) even before I brought it up, and that's what I suspected you're going to say, Senator Durbin, which is it can't just be short term spending increases for long term spending cuts.
Revenue, is that a nonstarter? One of the ideas is not raise rates, but just that you would close some loopholes, tax reform and use some of that money to cut the deficit.
BLUNT: You know, I don't know anybody that's opposed to closing loopholes. In fact, if we were going to do a revenue neutral tax rewrite, Chairman Camp, Chairman Bachus could do that and do that pretty quickly.
BLUNT: The amount -- the percentage of the wealth of the country, the gross domestic product of the country that's coming to the federal government right now is pretty much where it has been at the high numbers since World War II.
WALLACE: About 18 1/2 percent, 19 percent --
BLUNT: About 18 1/2 percent, 19 percent, why does it need to be more that? This is not -- you know, this is not about closing loopholes. Who's not for that?
This is about whether you close those loopholes to make tax rates lower, or you close those loopholes so that you have more than 20 percent of the gross domestic product coming to the government, and then -- you know, the Congress just failed today do it's job. Still, the unwritten story about the shutdown was that we were at the last day of the spending year, and not a single appropriations bill had passed the Senate of the 12 it need to fund the government. Only one of them had been brought to the floor, and it was the one -- it was one that the majority leader knew couldn't pass.
WALLACE: Well, I don't -- let me go back to taxes, because I do think that always seems to be the big problem here. Senator Durbin, why is it any different than Republicans refuse to raise revenues, than President Obama's refusal to make in changes in ObamaCare.
DURBIN: Let me just tell you this before we go any further. I want to correct the record for Roy.
The one appropriation record that we brought to the floor, the transportation bill, was a bipartisan bill -- Senator Murray, Senator Collins. When we brought it up for a vote to go forward, with the only appropriations bill we brought to the floor, Senator Blunt and all of the Republicans, except Senator Collins, voted against going forward on the bill.
So, don't criticize us. We tried to move forward on appropriations bill.
WALLACE: OK. You guys are so far beyond what most people know or I think care about.
Go back to taxes. Why is it that Republicans are unreasonable when they say no new taxes, but President Obama is perfectly reasonable when he says no changes to my health care reform plan?
DURBIN: You've never heard me say that. I don't think you've heard the president say that. There is no perfect law. I said before, the only perfect law was brought down on clay tablets by Senator Moses off a mountain.
So, we should sit down and look at constructive ways to make ObamaCare, the Affordable Care Act, work better. Chris, look at what's happened here. In just a short period of time, 17 million persons have tried to log on to this Web site. A half a million -- I'll dispute some of your earlier claims -- a half million are moving towards signing up for health insurance.
This is a popular program. Let's make it work better instead of trying to defund it.
WALLACE: I'm going to talk about ObamaCare on a second, but you're not answering my question. Why does taxes -- why do taxes have to be on the table? Why can't you just make a deal, short-term spending for long-term entitlement reform -- which, Senator, you support and President Obama support. You have supported the idea of some entitlement reform.
DURBIN: That's right. I do, and I'll tell you why -- because Social Security is going to run out of money in 20 years. I want to fix it now, before we reach that cliff.
Medicare may run out of money in 10 years, let's fix it now. And that means addressing the skyrocketing cost of health care. That's what ObamaCare is focused on, and yet, the Republicans want nothing to do with it.
If we don't focus on the health care and dealing with the entitlements, the baby boom generation is going to blow away our future. We don't want to see that happen. We want to make sure that Social Security and Medicare are solid.
WALLACE: All right. Let me bring Senator Blunt into this. We have been talking about the fact that the Web sites are shut down again for repairs this weekend. We have the situation with Secretary Sebelius where she can go to a gala in Boston, but no, she won't testify before a House committee.
BLUNT: Well, I think the secretary's view that she doesn't have to testify, doesn't have to answer questions, is too busy for that is unsustainable. And she won't be able to sustain.
You know, what we're really about talking about here --
WALLACE: When you say not sustain it, should she be out?
BLUNT: I think she will have to testify. I don't think she can refuse to answer questions about this, and trying to defend that I have to time to go to a gala in Boston, but I don't have time to appear before the Congress because I'm busy trying to make the system just doesn't make sense. And people know that.
But, you know, this is a very mechanical thing. The most expensive Web site ever, and it doesn't work. We're nowhere close to knowing whether the president's health plan is going to work or not, and people are going to find out over the next few weeks and months just how hard it is to sign up, what happens to your insurance rates.
We'll see if Senator Durbin is right or if I'm right. I don't think this plan will work because I think it's based on a couple premises that don't work. When you can't put together a package to sign up, that shows how big a job it is to try to -- for the federal government to manage 16 percent of the economy, and people's health insurance plan is not where the federal government should be.
WALLACE: Senator Durbin, we've got about a minute left. Isn't this rollout an embarrassment that raises serious questions about ObamaCare? And isn't it an embarrassment that Secretary Sebelius is refusing to answer questions from a House committee?
DURBIN: Listen, ultimately, Secretary Sebelius will testify before Congress, you know that. I don't know about the circumstances with this last minute, let's do it in a few days. But 17 million people have already -- 17 million Americans have already visited these Web sites. We understand --
WALLACE: How many have signed up, sir?
DUBRIN: Almost a half a million and let me tell you, one of the most --
WALLACE: No, half a million have filed applications and the government continues to refuse to say how many have enrolled.
DURBIN: Absolutely. What else -- what else are we going to do but take their applications and process them. But that's an indication of national interest.
One of the most successful states per capita so far is Kentucky, the state of Senator McConnell and Senator Rand Paul. They've had 10,000 people. Governor Steve Beshear has done there. It's an amazing outpouring of interest in health insurance and the Republicans want to close it down.
WALLACE: So, in 30 seconds, do you think this has been a success, sir?
DURBIN: I think it's on it's way to be a substantial success. It's off to a rough start with the Web site.
But if we're talking about competency and accountability, I have a question for the Republicans. We just went through a government shutdown of your creation. It's cost $30 billion for taxpayers, hundreds of thousands of jobs, and the Republican Party brand is at the lowest level in the last 30 years. Who's going to be held accountable for that? Is there going to be a question about the future of Senator Cruz and his own Republican conference?
WALLACE: It's a very good question, you got 30 seconds to answer it, Senator Blunt.
BLUNT: Well, the answer is -- Senator Durbin and some others think somehow this is a big win for their party? Nobody won in the last three weeks. The president saying he won't negotiate about important issues, Democrats in the Senate rejecting offer after offer from the House. People's confidence in government is shaken.
Democrats look terrible, Republicans look terrible, the president looks terrible -- we all better figure that out before we go into drawing lines in the sand like changing the Budget Control Act in this next set of negotiations.
WALLACE: On that happy note -- Senator Blunt, Senator Durbin, thank you both. Thanks for coming in today. We'll follow what happens with the budget and ObamaCare.
Thank you, gentlemen.
BLUNT: Thanks, Chris.
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