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CNN "State of the Union with Candy Crowley" - Transcript


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CROWLEY: Joining me are Democratic Senator Mark Warner of Virginia and Republican Senator Kelly Ayotte of New Hampshire. Thank you both for being here.

AYOTTE: Great to be here.

WARNER: Thanks, Candy.

CROWLEY: Senator Warner, first to you. You heard the Republican reaction to what Timothy Geithner brought to Capitol Hill. It seems to me it kind of moved things backwards. There was sort of this, OK, OK, we're -- you know, we'll put revenue on the table, and suddenly people are saying, well, we're really far apart. We're at a stalemate.

Did it do more harm than good?

WARNER: I don't think so, Candy. I mean, when they first met, the president laid out his opening offer many terms of a down payment. Let's go ahead and have the rates go back up, which, by the way, was the assumption that was made in the Simpson-Bowles plan, was the assumption that was made in the gang of six plan.

WARNER: You can still do tax reform off that higher base.

Then they said, no, that's not enough, give us your full plan, because as somebody who has spent more time doing business deals than I have in politics, you lay out a term sheet. Well, the president laid out a term sheet with all the details.

I think in any negotiation I've been involved in, you put down a term sheet, the other side comes back and says, no, I like this part, I don't like this part. And my hope would be they would actually get to those negotiations because every day that clicks off, we are hurting the economy as we go into the Christmas retail season, as people are probably not buying because they may not know all the details of the cliff, but they know bad stuff is going to happen if we don't get our act together and get this done.

CROWLEY: And, Senator Ayotte, you heard the treasury secretary say, well, now it's up to the Republicans, they have got to bring us something. What would that something be?

AYOTTE: Well, Candy, let me just say I was disappointed by the president's proposal. I think it's essentially a rerun of his budget proposal. I mean, the revenue proposals are, you know, $1.6 trillion in revenue and tax increases. It's a massive tax increase.

But also not significant and meaningful entitlement reforms, which is -- as you know, the speaker came forward and put revenue on the table and said, you know, for Republicans, we really want to solve this.

And I want to commend Senator Warner for the work he has done on the "gang of six" and also the "go big" principles because that has contained really three components. You know, revenue, spending cuts, meaningful entitlement reforms. Obviously, we need to give that certainty to our economy as well. We want to solve this, and I think the speaker earnestly wants to solve it. I was disappointed by the president's initial proposal here.

CROWLEY: Do you think the president has to get more involved in this? We've seen -- you know, some Republicans are saying, where is he? You know, well, he was up in a sort of campaign style event on Friday while Geithner was presenting this thing.

And honestly, Senator, there's -- as you point out, there are three kind of critical business weeks coming, certainly for retail, and it has taken us almost a month since the election for the president to put out what everybody already knew he wanted, so what...

WARNER: The first meeting, the president laid out let the rates go back up. The assumption that Simpson-Bowles had, the assumption the "gang of six" had, and then said to our Republican colleagues, give us back what you want for a down payment, because we're not going to solve all of this by the end of the year.

Then they said no, give us more detail. And through Secretary Geithner, they've laid out more detail. I think it's also incumbent...

CROWLEY: But it wasn't new detail, and it has taken so long.

WARNER: But it's also incumbent upon the president to realize this is a conversation he needs to have not just with Washington, but with the fact of everybody in the country. So bringing in business leaders, bringing in small business owners, going out across the country.

One of the reasons why I think this time it's going to be different from the failures of the past, you know, the debt ceiling debacle, the failure of the super committee, is I think the American people and particularly the American business community, realize what's at stake, and I think there is an awful lot of us, frankly, in both parties who are willing to get there. And I want to commend Kelly as well.

There has been a big group of us, well in excess of the majority in the Senate, who said, we're willing to do our part. We want to give the president and the speaker room to get the framework, but we'll be there to get -- to help fill in the details as we go forward.

CROWLEY: Senator Ayotte, it has -- there's not much time left here, and it does seem like an inordinate amount of time, almost a month has passed, and we have a description of stalemate and way far apart.

AYOTTE: Candy, I see that as very disappointing, a big problem. That's why I didn't like seeing that essentially it was a rerun of his budget that couldn't get support from either party in the House or the Senate.

So it is time. I see, you know -- for the speaker to come forward and put revenue on the table, that was a big...


CROWLEY: That was a big thing, would you agree? The speaker put revenue on the table the day after the election, I think.

AYOTTE: That was very difficult. But let's -- I mean, I know that Mark has been -- understands that, but the primary drivers of our fiscal crisis, when we think about it, we don't want to go bankrupt. We don't want to be like Greece. Entitlement reforms, the majority of our spending, and also to make sure that those programs are preserved, 2024 Medicare is insolvent, Social Security, 2033. These are important -- it is time for us to come together and solve the big problems.

CROWLEY: Do you agree entitlements absolutely positively have to be on the table?

WARNER: I think entitlements have to be part of the mix. But saying you're putting revenues on the table versus specificity is really two different things. As a business guy, you've got to have a term sheet with details.

If the Republican leadership...

CROWLEY: If Senator McConnell said, hey, you know what, let's raise the...

WARNER: If the Republican leadership doesn't like the details in the term sheet that Secretary Geithner laid out, come up with a counter term sheet.

You know, we've got to get past the kind of Washington decoder- speak and say specifically, how do we get there? I also believe that one of the things we need to get to is major tax reform, but we need to go ahead and lay down what we're going to get done before the end of the year, and then how we get to that. I believe at least $4 trillion in net deficit reduction.

CROWLEY: Let me stop both of you there, because I have got to take a quick break. So they'll stay with us after a short break. I do want to come back and ask you about President Obama's U.N. ambassador, Susan Rice. Has the Benghazi incident ruined her chance to come the next secretary of state?


CROWLEY: We're back with senators Mark Warner and Kelly Ayotte.

Final wrap-up question on this fiscal cliff. Do you both agree with the following? This deal has to happen and this deal will happen before the end of the year?

AYOTTE: It has to happen, Candy, and I truly hope that it does happen. And -- but I'm really disappointed by the president's initial proposal, and I think that we've got to get beyond, you know, the tax rate issue.

I just want to say one thing. Republicans have offered closing loopholes, deductions, or capping deductions. There is more revenue there. The tax rate issue is more of a political trophy than an economic solution. And so it's time for us to get to the table and resolve it.

I think there's some will, though, among both parties to get this done. CROWLEY: Hoping it will happen is not the same as saying it will happen.

WARNER: It will get done. And quite honestly, getting this done will do more to jump-start jobs and the economy than any single policy proposal that either Governor Romney or President Obama put out during their campaign.


Let me turn you to Benghazi. You've been quite outspoken, senator, I know about Susan Rice, the UN ambassador, the things that she said on the Sunday following the Benghazi attack which turned out not to be true. Are her chances to become Secretary of State should the president nominate her, and we expect something to happen this week on that, are her chances over? Is she a nonstarter for you?

AYOTTE: Well, Candy, I did meet with her this week. I remain very troubled not only myself, for example, the ranking Republican Susan Collins of the homeland security committee raised some very important questions after meeting with her.

But here's where we are. If after the meeting with her - I think there was an impression left that she just went on and repeated some unclassified talking points on all the Sunday shows, but she had the daily intelligence briefings, including the classified talking -- materials that basically had the references that individuals with ties to al Qaeda were involved.

CROWLEY: So you think she knew al Qaeda...

AYOTTE: She did. That information was -- she had reviewed it before going on Sunday shows, and went on the Sunday shows went well beyond the talking points saying we have decimated al Qaeda, that was no where in the talking points, said things like the attacks were a result of the -- direct result of our heinous and offensive video, that was want in the talking points, said that the security at our consulate was substantial, strong, significant. That's not in the talking points and frankly, not supported by the record.

I mean, what happened that day?

CROWLEY: So has Susan Rice disqualified herself...

WARNER: Nothing I have heard in my mind would disqualify her thus far. Now, that's amazing to me that we should be focusing on not so much what was said about which talking points, but how did the tragedy where four Americans were killed in Benghazi happen? We've got a State Department investigation headed up by Tom Pickering and former General Mullen. We've got on the intelligence community on which I serve, we're now in a series of hearings looking at that.

How do we make sure? I'm sure Kelly and I would agree that we have got appropriate protection for our State Department personnel. How do we make sure if they come under assault that we have got assets to be able to come in and protect them. What I find remarkable is the president hasn't even nominated anyone yet. Why are we spending all this time if you nominate Secretary Rice or Ambassador Rice, we ought to have these discussion. What we ought to be looking at is what happened in Benghazi, how do we make sure it never happens again?

CROWLEY: Do you find it interesting - I mean it is, that happened September 11. It is now December 2, and we still don't know what happened. Why there wasn't any security. I mean, isn't it part of that overall discussion?

AYOTTE: And I agree with what Mark said in terms of the big picture question here. Why don't we know yet? First of all, why was the consulate so unsecure given the prior attacks, given that the British left, the Red Cross left? And also during a seven-hour attack why couldn't we help those individuals?

But also, this talking point issue, I hope that our intelligence was not politicized because there have been some intelligence questions and failures here. We've had three stories on the talking points, so that's important just for making sure that our intelligence is solid going forward.

WARNER: Well, remember these talking points came at the request of the House intelligence committee. If there was a way to make sure we get those cleaned up and they were amended four days later. Again, we'll get into this if this individual is nominated, but I think at the end of the day we make sure we never have this kind of tragedy again.

And candidly, back to the issue before, in 30 days we have to decide whether this country is going to go over a cliff that would be dramatic not only to our economy but to the world's economy. That's where we ought to have our focus right now.

CROWLEY: Senator Warner, Senator Ayotte, thank you for joining us.

AYOTTE: thank you, Candy.


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