finance off the government. you can't do it cold turkey. you have to do it gradually. our plan takes a decade to do that. >> jon: we'll be here then. if they fight for a decade that should be all right. we're all going to die! [laughter] >> it's been three years we haven't done anything. you have to address it at some point. you would hope a private mortgage finance system well functioning. you have to have it well regulated and if you have that you have a much better functioning economy afterwards. >> jon: one word yes or no is that -- there any possibility in this universe that that gets done? >> 50/50. >> jon: "guaranteed to fail" it's really disturbing. get it.

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[cheers and applause] >> jon: that's our show. join us tomorrow night at 11:00. here it is your moment of zen. >> first lady michelle was seen ordering a cheesebugger, fries captioning sponsored by comedy central captioned by media access group at wgbh access.wgbh.org

>> tonight will america default on its debt? and if so, will canada let us crash on their couch for a while? then, a fresh young face for the republican party. he's only 235 years old. [laughter] and my guest david mccullough has a new book about americans in paris. sounds like somebody wants to deduct his vacation. [laughter] a six-year-old beauty queen has retired. i'm not surprised -- she was starting to get crow's dimples. this is "the colbert report." captioning sponsored by comedy central ["the colbert report" theme music playing]

[cheers and applause] thank you very much. woo! woo! boom boom boom boom! [cheers and applause] [crowd chanting stephen] [cheers and applause] welcome to the report. good to have you with us. that kind of chanting makes me want to say, you are the man! but -- [laughter] i don't want to get that wrong. [laughter]

nation, we all know the gop's number one priority is to make sure obama is a one-term president. but i say, aim higher. make him a no-term president. let's build a time machine, go back to the 1970's, and convince young barack to go into dentistry! [laughter] he would have been good. i would have trusted him for that. [laughter] but on the slim chance that my time machine plan doesn't work, there may be another way to win. republicans have an edge in 2012, thanks to a new study out of the university of chicago which found that seeing an american flag can shift voters towards republicanism. before the 2008 election, researchers gave two groups with the same political beliefs questionnaires asking who they were going to vote for:

obama or mccain. the questionnaires were identical except one group's form had a small american flag and the other did not. after the election, researchers found that those who saw the flag were less likely to have voted for obama. that means mccain could've won, if only he'd shown up to debates like this. [laughter] threw it away. he threw that one away. [ laughter ] this study has me thinking. we may have a new gop frontrunner -- the honorable franklin f. flagworth. [laughter] this guy's got everything. he's a war hero. he's been to the moon. we know he was born in america. and like all great presidents, he has an embarrassing southern relative and he has had a sex

scandal. [laughter] is there a baby? i'll never tell. [laughter] plus, whenever he shows up, the other candidates have to pledge to him. sure, sometimes he goes whichever way the wind blows, but nobody will ever question his patriotism. once we give him a flag pin. [laughter] that's the guy. and folks, we need a new leader soon, because america is standing at a precipice. which i think is either a bon fire or a poisonous australian jellyfish. not sure, but the point is, precipices are scary, and we're at one. in just a few weeks, we will reach the deadline for raising america's debt ceiling. if congress doesn't authorize borrowing more money, it could destroy our credit rating and and then

china would back a tow truck up to kansas and drag it off to guangdong province. [laughter] that may happen. that may happen because the president and congressional republicans are locked in a staring contest over a pissing contest over who will blink first. my bet is whoever gets their eyes pissed in. [laughter] now, i haven't talked about the debt ceiling a lot on the show, because i think a news show talking about federal budget negotiations is just cheap, salacious viewer bait. [laughter] i lean toward harder news like duck fashion shows. adorable. good story. i broke that story, by the way. [laughter] but here's how we got where we are. about six months ago, the president said to the republican leadership "you guys, we gotta raise the debt ceiling." the republicans said, "no way, nerd." [laughter] the president said "you guys,

this isn't funny! if we don't raise it, the economy will melt down. and we could get into trouble!" [laughter] so the republicans said, "okay, if you're really that worried about it, poindexter, we might vote to raise it, but first we have to make massive budget cuts." the president said, "thanks, guys." [laughter] so far, the gop plan is working. they've got barry here over a barrel, and they are spanking him like a page in the senate cloakroom. [laughter] obama agrees to $4 trillion in cuts. but then, in a truly cynical move, obama pulls the old washington trick of asking for something in return. but house majority leader eric cantor explained that the republicans only concession will be "the fact that we're even discussing voting for a debt-ceiling increase." ok? they agree to negotiate, in return the president gives them everything they want.

it's like the old saying "you scratch my back, i get my back scratched." [laughter] they can't -- these republicans -- yeah, these people understand. [laughter] they can't give obama an inch. 'cuz again, cantor said it best: "i don't think the white house understands how difficult it is for fiscal conservatives to say that they're going to vote for a debt-ceiling increase." come on! imagine the shame of having to look their constituents in the eyes and tell them: "the american economy still exists." [ laughter ] and listen to what obama wants in return: if we choose to keep the cuts for millionaire and billionaires we have to make deeper cuts somewhere else.

steerchl he's saying they have to raise taxes. and republicans cannot agree to that. they've all signed grover norquist's anti-tax pledge! he's like darth vader; he can crush their larynx with his mind. [laughter] that's based on a true story. now that we're in this crisis that the republicans created to get partisan advantage but the republicans have to either raise taxes or get blamed for defaulting on our national debt. they seem to have painted themselves into a corner, or as political scientists call it, "got their nuts caught in a vise." thankfully, on the senate floor yesterday, minority leader and septuginarian ninja turtle mitch [laughter] mcconnell swooped in and saved the day. first, pointing out that the republicans have no good options. >> the president has presented

us with 3 choices: smoke and mirrors, tax hikes or default. republicans choose none of the above. >> stephen: coincidentally, "none of the above" is also the leading republican presidential candidate. [laughter] but he has a simple way out of this mess: to keep the republicans from being blamed for raising taxes or defaulting all they have to do is ask the president to submit a request to congress to raise the debt ceiling. then, vote yes on a resolution disapproving of the thing they asked the president to do. then, obama would veto the disapproval, and since the republicans don't have the two thirds majority to override the veto, the debt ceiling gets raised and the republicans get to say they voted against it. twice. just like the classic jimmy stewart movie. "mr. smith gives up and starts shooting people."

[laughter] [cheers and applause] it's brilliant. [cheers and applause] [laughter] it's brilliant. the gop gets everything they want, except anything they asked for. and obama gets stuck with what he wanted to begin with. and mcconnell has gotten their nuts out of that vise -- by cutting them off and leaving them behind for obama to hang from his rear view mirror as an air freshener. [laughter] not that mcconnell's nuts would be that refreshing. when we return, we will bask in the brilliance of mitch mcconnell with wall street journal congressional correspondent, naftali bendavid. is

[cheers and applause] >> stephen: welcome back, everybody. folks, before the break -- before the break, i was congratulating congressional republicans on the way they cunningly used the debt ceiling negotiations to trick barack

obama into getting what he wanted. here to tell us how the on-going negotiations are going on is wall street journal congressional correspondent, neftali bendavid. thank you so much for joining us today. i read your publication today. they had an editorial in there saying this is kind of a smart move for mcconnell to make given the situation. what is the reaction been in the republican party to what mcconnell has done? is everybody as excited as i am? >> plenty of republicans are very, very unhappy about this. the conservative blogo sphere lit up -- >> stephen: i tried to good on red state and my computer exploded. >> they called him a weasel and upon theous and other things you could think of. the house republican leadership is cool to the idea. even some of the senate remembers are backing away from this because they are worried it's giving obama too much. >> stephen: what happens next?

i understand just a little while ago obama walked out of the debt negotiations and said don't call my bluff no other president, reagan, would sit here like this. >> there's an increasing testiness between cantor and obama. they are going at each other. sometime it's a prelude to reaching a deal. they are posturing and then they can sit down and degree. on august 2 the united states will no longer pay its bills or financial obligations. it's getting to a scary point. >> stephen: that could guarantee. this could be part of the plan that could guarantee obama is a one-term president because there's no more america. la laugh. >> there's maneuvering going on for who would get the blame. >> stephen: obama, right? he gets the blame thank is the republican hope is that obama gets the blame because he insisted on tax hikes is what they would say. obama is saying that since they are not compromising they should

get the blame. >> stephen: he says "don't call my bluff" to eric cantor but he is calling their bluff, isn't he? i think one of reasons why he is calling their bluff is that they have publicly said their bluffing. [laughter] they have said, you know, we -- we won't raise the debt ceiling. [ applause ] then they publicly told the wall street buddies, don't worry we're going to raise the debt ceiling. that's like paying poker across from obama and saying (bleep) we're all in. you don't want to see what i got in my hand and then turning to your buddy and saying i got nothing. obama is using the fact that he heard them say that. >> i think one of factors here is that i'm not sure that the republicans can control their own truths. particularly speaker baner in described getting this -- speaker boehner said it was a

rubik's cube. >> stephen: reagan said his first piece of legislation was like crapping a pineapple perhaps they are trying to crap a rubik's cube. >> this is a hard thing to get through and in one has figured it out. >> stephen: let's talk about the brinksmanship here. i love it. i love the power play going on. i'm actually drooling i love it so much. [laughter] i love the play of forces here. and the rule is -- phil graham said never take a hostage you are noting mr. to shoot. republicans have taken americans hostage here saying give us what we want or we blow the economies brains out. do you think it would help if they continued the negotiations long enough until america got stockhome syndrome and fell in love with what the republicans were doing, changed our named to

tracey and married them. [laughter] >> i think one of problems here is that at some point it's reality and it's not a joke anymore. this is scary stuff. >> stephen: this is not funny to me. naftali bendavid thank you so much. from the wall street naftali bendavid.

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[cheers and applause] >> stephen: welcome back, everybody. my guest tonight is a world famous historian who has written a new book about americans in paris. if it's anything like my experience there it's about having your -- if it's anything like my experience there, it's about having your siouxie and the banshees cassettes stolen from your backpack out of the youth hostel. please welcome david mccullough. [cheers and applause] good to see you. please. good to have you. what an honor to meet you, sir. >> a wonderful chance to be with you, thank you. >> stephen: i have to say, obviously i admire your writing and collarship but the look. you have really got that wise old man thing down! >> the old man! >> stephen: i gotta get that

look. unfortunately i am cursed with eternal youth and raven hair. [laughter] the new book is called "the greater journey: americans in paris." now this is the 19th century americans going to paris. why would they go in the 19th century? >> almost all the people i have read about were young americans of talent ambitious to excel, writer, painters, sculptors, architects and physicians, doctors. >> stephen: why go to france? that seems unpatriotic. they should have stayed here and appreciated american things like the statue of liberty and mayonnaise. checkmate. checkmate. [laughter] why would they go there? >> the statue of lib ber tip hadn't arrived yet.

-- liberty hadn't arrived yet. there were no schools of architecture here. medical training in in country was woefully behind. most american doctors had not been to medical school. >> stephen: no? >> and trained under doctors that never went. >> stephen: how did it help to good to france? they were teaching medicine in french. >> that's right they had to learn french to attend the school there. >> stephen: were they just as senate toy as they are now? they are creeping people. [laughter] >> you have to remember that frns and the united states have been in very good relationship for over 200 years. there have been rough time it's be sure. >> stephen: oh, yeah. >> but we would not have succeeded with our revolutionary war or independence had it not been for the financial help and military help of the french both on land and sea at the surrender

of cornwallis at yorktown, for example, the army under rorcha rorchanmbeau was larger than the army under washington. >> stephen: i don't like. that we'lled it that out. what did we get back from the young thinkers that went there? >> we got back numerous paintings of major importance which hang in the galleries and in the white house and everywhere in the country. we got back an idea for something called the telegraph which samuel f.b. morse came back with staofrpblgts we stole that from the french? >> he was inspired but something he had seen in france before the teledbrf. he brought back photography. he didn't invent it