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MSNBC "Morning Joe" - Transcript


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MS. BRZEZINSKI: With us now, Democratic senator from Missouri, Sen. Claire McCaskill -- (exchange aside)-- who's the lead sponsor, the lead Senate sponsor of President Obama's PAYGO efforts to rein in government spending.

Ah. Shall we start there?

MR. SCARBOROUGH: Yeah, let's start there.

MS. BRZEZINSKI: Let's start there.

MR. SCARBOROUGH: So, Senator, you're from Missouri; obviously a state that is really -- I mean, God, it's the middle of America in every way.

MS. BRZEZINSKI: (It is. ?)

MR. SCARBOROUGH: And so I know you've got people in your state, constituents, that are concerned about what I consider really reckless spending by Republicans for eight years and reckless proposals over the next four to eight years.

How important is it for middle America to get the message that Washington is going to start being responsible with their tax dollars?

SEN. MCCASKILL: Well, they're not going to get the message until we are. I --

MR. SCARBOROUGH: But, by the way, you voted against -- what, was it the stimulus package?

SEN. MCCASKILL: I voted against the omnibus. I'm --

MR. SCARBOROUGH: Omnibus, yeah.

SEN. MCCASKILL: And I don't earmark. I'm one of the handful of folks that have spurned that way of appropriating money.

Joe, the problem is, is if you look at the deficit -- there's a pretty good analysis in The New York Times this morning about what makes up the deficit -- about 37 percent of it is cyclical.

Because we've got to spend a whole bunch of money right now on unemployment, more Medicaid, because of the downturn in the economy.


SEN. MCCASKILL: And around a third of it is Bush's policies, the tax cuts.

And one of the unbelievable programs that was put in place was Medicare D.


SEN. MCCASKILL: It was amazing. That entitlement program --


SEN. MCCASKILL: Insanity. No way to pay for it. No means testing.

MR. SCARBOROUGH: And $7 trillion --


MR. SCARBOROUGH: -- $7 trillion added to a program that was already going bankrupt. Stunning.

SEN. MCCASKILL: Right. Now -- and then around 20 percent of it is what we have done with the stimulus and spending and carrying on the Iraq war and the tax cut for folks under $250,000.

MR. SCARBOROUGH: And the Afghanistan war and the war on --

SEN. MCCASKILL: Right. Right. So how are we going to get out of this mess? How are we going to bring down spending?

We have to decide we're going to do one or two things. We have to decide we can't spend a dollar until we save a dollar, and we have to quit spending as much, and reform health care in a way that gets costs down.

MR. SCARBOROUGH: So let's say health care costs $2 trillion. You're going to find $2 trillion in cuts in the budget to pay for that?

SEN. MCCASKILL: Well, I do not think it'll pass unless it's paid for. I don't believe that it will.

MR. SCARBOROUGH: That's good news.

SEN. MCCASKILL: I really don't. I --

MR. SCARBOROUGH: With no accounting tricks. I mean, just seriously dollar-for-dollar, no rosy scenarios.

SEN. MCCASKILL: And ultimately, one of the frustrations for us is a lot of the savings we're going to get out of health care, if we do it right, are not going to be scored.


SEN. MCCASKILL: And as you know, there's this thing we have to do with OMB, which is a discipline I welcome, and that is it's got to score that it's paid for.

So we have to find ways to actually pay for, in the short term.

In the long term, I think it's got a chance of changing the entire arc of the deficit through the miracle of compound interest.

MR. SCARBOROUGH: So let me ask you this question. And I have people come on the show -- we were talking about it earlier -- and they say, well, we've got to do something. And I agree.

And then we say, okay, I'll give you years one, two, and three for stimulus purposes. Spend as much as you want to spend and let's revive this economy.

But as you know, CBO, the Democratic Budget chairman, a lot of people are saying it's the out-years, years four through 10 of the president's budget that are so reckless.

Are you concerned about the out-years, that the president puts this 10-year plan out there, that he even admits has deficits that are unsustainable, and now he comes to us and says, okay, now he's supporting PAYGO?

SEN. MCCASKILL: Well, I think that there was two problems. One was an economic retraction that was unprecedented, and he needed to do something.

MR. SCARBOROUGH: Right. Short term. That's the first three years. Right.

SEN. MCCASKILL: Then it's long term. And that's why this PAYGO is important.

And anybody who thinks it's a PR stunt, we're going to have a chance to vote on it. Vote for it. Let's put it into law.

It used to be a rule that everyone respected back in the '90s when we got to surpluses. And you remember those days.

MR. SCARBOROUGH: Yes, we did. But you know, Nancy Pelosi, though, promised in 2006 if Democrats took control of Congress they would have the PAYGO rules.

The second they got in Congress, they were just like Republicans the last six years. They were reckless and said, no, we're not going to do it now.

SEN. MCCASKILL: Well, I don't think it has been as reckless as you think.

Discretionary domestic spending has not gone up in the last two years, if you adjust for inflation.

MR. SCARBOROUGH: No, no, I'm just talking -- just for PAYGO, Democrats promised if they were put in charge they would use PAYGO.

SEN. MCCASKILL: And we've --

MR. SCARBOROUGH: And then Nancy Pelosi said no, we're not going to do it.

SEN. MCCASKILL: Well, there have been some instances where PAYGO has been ignored. AMT -- historically, we've adjusted the alternative minimum tax consistently without paying for it.


SEN. MCCASKILL: But by and large, there has been a lot of preaching from Kent Conrad and Judd Gregg and a lot of people in the Senate, we have got to stay with PAYGO.

MR. SCARBOROUGH: Oh, great guys, on this issue.

SEN. MCCASKILL: And I think we've tried, but this would make it law.

And if the president is willing to sign it -- which, by the way, Bush never indicated he would sign PAYGO as law.

MR. SCARBOROUGH: Right. Right.

SEN. MCCASKILL: What Obama is saying to Congress is I will sign a law that requires PAYGO. Now let's pass the law.

And I think that's a great idea.

MR. SCARBOROUGH: That would be exciting.

And so if PAYGO's in place, the president's proposed budget deficits down the road, that were in this first budget will, out of necessity, shrink, right?

SEN. MCCASKILL: They will. They will.

MR. SCARBOROUGH: That is good news.

SEN. MCCASKILL: Especially if we get to some of that entitlement health care costs and Medicare, which is the 800-pound gorilla in the deficit.

MR. SCARBOROUGH: We're in -- okay, could you explain that? because again, people come on the show; it's very frustrating, and they just say oh, we need health care reform because we have to pay the -- get health care for 47 million uninsured Americans.

Which, again, I say, just like the stimulus, fine. You want to make that investment, fine. But the tough question is how do you stop Medicare and Medicaid from bankrupting America, as it will by 2018?

SEN. MCCASKILL: You start paying for outcomes and --

My short answer is quit paying for scooters.


SEN. MCCASKILL: Anybody seen a scooter ad? Get a free scooter on the government? Now, just think about how stupid that is.

What should people be doing? Should they be walking or should they be riding a scooter for their health?

MS. BRZEZINSKI: Thank you, Senator.

(Cross talk.)

SEN. MCCASKILL: We have had market-driven reimbursements --

MR. SCARBOROUGH: By the way, Scooters R Us, major advertisers of MSNBC.

MS. BRZEZINSKI: No. People need to walk.

MR. SCARBOROUGH: But -- I understand your point.

SEN. MCCASKILL: I'm just telling you, and the scooter is a good example.

MR. SCARBOROUGH: That's a good example.

SEN. MCCASKILL: If we pay for outcomes, then we're going to have less cost.

If we have more Medicare providers in the area, it's more expensive, without better outcomes.

MR. SCARBOROUGH: Right. There are also going to be tough choices we're going to have to make --

SEN. MCCASKILL: Of course. We're going to have to make some people mad.

MR. SCARBOROUGH: I mean really tough. We're going to make Democrats mad, because chances are good the social safety net is going to retract, out of necessity.

We're going to make Republicans mad because there's going to have to be means testing. Everybody's going to be angry.

But it's got to be done, doesn't it?

SEN. MCCASKILL: Should we be helping pay for really wealthy people's medicine?


SEN. MCCASKILL: Can we afford that, seriously? Can we afford to help Warren Buffett with his cholesterol pills?


SEN. MCCASKILL: I don't think we can. We just can't.

And I think we need to be honest about that, and realistic about it.

MS. BRZEZINSKI: But isn't the problem that a lot of the savings are so far down the road, ultimately, when you completely make a full reform, that it's going to be a very tough sell at this time, after have spent so much money?

SEN. MCCASKILL: If this was easy to do, we wouldn't have the problem.

MS. BRZEZINSKI: Well, exactly.

SEN. MCCASKILL: And part of it is that we have come to a political world that you are so worried about making anyone mad that you end up just treading water. It's --

I call it -- the way that people learn to speak in Washington, where they go on for two or three paragraphs and never say anything. Because if you never say anything, you can't make anybody mad.

And we have seen it time and time again.

MR. SCARBOROUGH: Exactly. And the easy thing to do is to write the $7 trillion check for Medicare prescription drug benefits. The easy thing to do is write the $2 trillion check to give everybody health care insurance.

The tough part of it is writing that check and then telling middle-class and upper middle-class voters -- everybody -- listen, we're going to have to cut back on a lot of your benefits.

SEN. MCCASKILL: I think the --

MR. SCARBOROUGH: Who has the courage to do that in Washington?

SEN. MCCASKILL: Well, this will either get done the right way, or it will happen in a crisis. Because it's either going to get worse a little bit, incrementally over time, or it's going to get worse all of a sudden.

If our -- if the people that hold our loans, if all of our foreign bankers that -- frankly, we fought the Iraq war on the loans from China -- if they just all of a sudden, they're getting a little iffy about buying our paper.

MR. SCARBOROUGH: They're very concerned.

SEN. MCCASKILL: If they all of a sudden balk at buying all of our paper and we see and incredibly -- a spike in interest rates, then you're going to see the same kind of economic crisis on the inflationary side that we saw on the recession side.

And it will be something that we will have to deal with --

(Cross talk.)

MR. SCARBOROUGH: Change of topics.

MR. RATIGAN: (Inaudible) -- is to sell the dollar. The default position in America in the investment community is to -- barring some other variable on a given day, get rid of dollars. That's something we're going to have to deal with.

In other words, that goes directly to what the --

MR. SCARBOROUGH: The Chinese are getting very antsy right now, and for good reason.

So let's change topics.


MR. SCARBOROUGH: Do you know many Republicans on the Judiciary Committee?


MR. SCARBOROUGH: Like -- who's, like, one of your closest friends there?

SEN. MCCASKILL: Lindsey is a friend.

MR. SCARBOROUGH: Okay. Who else do you know on there?

SEN. MCCASKILL: Well, obviously, I know Jeff Sessions. He and I are both former prosecutors.

MR. SCARBOROUGH: Well, they're all friends of mine. I love 'em all. And -- even if half of them hate my guts.

MS. BRZEZINSKI: Now, stop. I'm sure --

SEN. MCCASKILL: No, they don't hate you.

(Cross talk.)

MR. SCARBOROUGH: They really -- you know what? Republicans don't understand Republicans -- (cross talk).

MR. RATIGAN: They're just jealous, Joe. They're jealous.


SEN. MCCASKILL: You guys are having a little internal warfare right now. And we're just getting a bag of popcorn and a Diet Coke and watching --

(Cross talk.)

MR. SCARBOROUGH: Unfortunately --

MR. RATIGAN: Apparently, they hate you. Never mind.

MR. SCARBOROUGH: I've been fighting this war since, actually, 2004, Medicare Part D.

But anyway, would you just tell them we're going to chip in here on the "Morning Joe" set, because we're concerned for their well- being. And we're going to get them an Evelyn Woods speed-reading course. And I think they've got them now on DVD --


MR. SCARBOROUGH: -- where they'll show the words and tell you how you can read faster.

MS. BRZEZINSKI: I could pick them up at the bookstore when we go to our book signing tonight.

MR. SCARBOROUGH: Just so they can actually get somebody on the Supreme Court by the end of July.

Would you tell them that for us?

SEN. MCCASKILL: Well, 60 days is a reasonable time, I think.

(Cross talk.)

SEN. MCCASKILL: I think Roberts and Alito were both -- one was 72 and one was 60-something.

MR. SCARBOROUGH: But Republicans are angry, though, because the hearing's going to be in July.

MS. BRZEZINSKI: They're being rushed.

MR. SCARBOROUGH: Explain that to us.

SEN. MCCASKILL: Well, and if they read those opinions, they're going to find somebody who is brimming with judicial restraint. That's the irony of this.

MR. SCARBOROUGH: Wait -- brimming? (Laughter, cross talk.) How does one --

When she decides to take over, like, whatever, you just -- brimming with judicial restraint? That's a bumper sticker that's going to follow you.

I hope it's the case. But seriously, what are the Republicans doing saying this is not enough time? That's just a silly, silly argument.

SEN. MCCASKILL: It's what we do in Washington. Lots of times they're silly arguments; you know that.

I think we're going to have the hearings in the middle of July, and I think the Republicans, there's going to be a lot of -- (inaudible).

And by the way, let me say this happens when a Republican nominates a Supreme Court justice.


SEN. MCCASKILL: This is not a sin that occurs on one side of the aisle and not the other. There's this game of gotcha that goes on.

If you really sift down through all of Judge Sotomayor's record, especially if you look at the fact she came up through the ranks as DA in a state court, that's a real prosecutor.

That's somebody who is not picking which case to prosecute. That's a 911 prosecutor.


SEN. MCCASKILL: She is really a moderate, moderate justice. And she's going to get confirmed.

MR. SCARBOROUGH: I want to end this on a personal note and a personal plane.


MR. SCARBOROUGH: Mika and I went down to Princeton last night --

SEN. MCCASKILL: I bought my Kindle over there. I've got to confess; can I confess? I have not yet downloaded --

MR. SCARBOROUGH: You don't have to tell us!

But this was a thing, though, that we took away from it, because you know how shrill some cable shows can be, and some authors can be?


MR. SCARBOROUGH: We went there last night and it was about 50 percent Republican, 50 percent Democrat. These are the type of people that would vote for you or a reasonable Republican. And everybody's concerned.

And you and six, seven Democrats in the Senate, you really do -- you control where this country goes over the next two years. And it's just important.

It's really important that some restraint is shown and some realism is shown, so --

SEN. MCCASKILL: And everybody needs to remember it's okay not to get every single vote.


SEN. MCCASKILL: We've got to realize that there are going to be some people that are angry with us.

And we've got to try to do what's right for the country and not play to the cheap seats, not go to the lowest common denominator --


SEN. MCCASKILL: -- and realize that if it means we don't get reelected, you know, it's not the end of the world.

(Cross talk.)

MS. BRZEZINSKI: (Inaudible) -- you'll like the book.

MR. SCARBOROUGH: But anyway, there are a lot of people out there that aren't ideologically right or ideologically left. They're just right in the middle.

SEN. MCCASKILL: That's exactly -- there's a bunch of us.

MR. SCARBOROUGH: And that's why this PAYGO plan, I hope this time it works.

SEN. MCCASKILL: I hope so, too.

MS. BRZEZINSKI: Senator Claire McCaskill, thanks very much. Great to have you in the studio. You're a great guest.

SEN. MCCASKILL: Fun to be here.

MR. SCARBOROUGH: It's great to be here. Thank you. Thanks for keeping the taser --

(Cross talk.)

SEN. MCCASKILL: I didn't even get to talk with Willie --

(Cross talk.)

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