pursuant to clause 12-a of rule 1, the house declares the house in recess until 2:00 today. >> "" continues.

host: this is shia kabbas talking about issues of the debt ceiling and federal spending. thanks for giving us your time again. guest: good to be with you. host: back in september of 2021, we were talking about the same thing, needing a debate about debt limit so why have we come to this point where we are still dealing with these issues and we bump up against these deadlines? guest: here we go again, as they say. the federal debt limit is in law by congress that limits the ability of the treasury department to borrow a certain dollar figure. right now, the dollar figure is $31.4 trillion. it has increased many times over the course of the last hundred or so years. especially over the last decade, you have these recurring debt limit apples where there are negotiations and demands about what should be attached to the

debt limit and an extendedperiod about uncertainty how that will take place in the debt limit gets extended. the last time we had one of these was in 2021 and we are here again at the beginning of 2023. it comes in the cycle of having these debates. there is no clear path off that road. we need to get out of the paradigm we are in otherwise we will keep having this over and over and. we have very large fiscal challenge. that is expected to grow substantially larger over the coming year. the reason we keep running up against the debt limit is because we have this federal credit problem. it's not an effective tool to manage that. unfortunately, we will keep running back to this unless congress says they want to change the process. host: we heard house speaker

mccarthy expect to sit in with president biden to discuss those matters. what are your feelings about this conversation? do you have a sense of optimism? guest: it's a necessary first step. you have to get the two sides talking together before there is any negotiation. unfortunately, it seems this meeting is largely going to be an opportunity for both sides to restate the talking points they've been sharing with the media. that's not necessarily a cook -- because her optimism. i'm sure we will pay off her bills on time. we've had a debt problem for many years and congress has been externally reluctant to take that on a do anything about it.

the only deficit reduction we've had in the past decade is the inflation reduction act which the democrats passed last year which only had a moderate impact. that will raise some amount of money. the solution need to be much bigger than that. we need the two sides to talk to each other to make that happen. well the meeting is a necessary first step, i'm not encouraged we will get a resolution out of it. host: you can ask air guest questions. -- our guest questions. you can call in and pick the line the best represents you and you can also text us. you can also post on our social media sites. let's play a little bit of the house speaker yesterday talking about his responses.

let's hear from him directly. [video clip] >> are you willing to consider any reductions to medicare and social security? >> let's take those off the table. we talk about strengthening social security. the president says he doesn't want to look at it but we have to make sure we strengthen those. >> you mean lift the retirement age? >> what i want to look at is they have increased spending by 30%. when you look at what they have done, adding $10 trillion of debt for the next 10 years in a short time, they went through and they never passed a bill through appropriations in the senate. mr. schumer has been the leader and he is never passed a budget and is never passed in appropriation bill and he simply waits until the end of the year to allow two senators were no longer here to write a $1.8

trillion on the biz bill. >> you want to come to an agreement on a budget? >> yeah, i think our first responsibility is we should both pass a budget. this way the country can see the direction we are going you cannot continue the spending that is brought this inflation and economic problems. we got to get our spending under control. host: that was the house speaker's take on upcoming conversation. do you want to respond to anything else? guest: the speaker makes interesting points. some of them i strongly agree with. we should have a budget resolution passed in the congress. they are supposed to do that every year but far too often, they pass that responsibility that makes it difficult to go from where we don't have an outline to an agreement on how we will fix our fiscal problems. what is ironic is that both parties basically don't want to

touch medicare and social parity. -- and social security but those are the two biggest programs in the federal budget but those are off limits so it becomes externally difficult to extend revenue. ultimately, we will need to have conversations about those programs sooner rather than later. unfortunately, the debt limit is not an effective pointed wish to have this conversation. it's the only point when we have this conversation was his why -- which is why we are where we are today. there is no other opportunity where republicans and democrats get together and have serious conversations about our fiscal problems. we need a change in the paradigm reset up another rosses that will work at her than the one we have today. i don't think that will fix all of our challenges but if we replace the debt limit debate over 31 trillion dollars in

threats about not paying the bills and replace that with an actual serious process where there is a debate over her spending program and tax programs, that would be a much more constructive conversation. host: here are the phone lines -- you can also text us. let's hear from john in cleveland, ohio. hello. caller: the money is already appropriated. it's an oxymoron. [indiscernible] medicare and payroll tax,

they've had it for 70 years. the answers are there. they should take a lie detector test. host: that's john cleveland, ohio. guest: the caller makes some good points where the solutions have been known for some time especially in the social security challenge. it's more about math problems and medicare problems. we know what the options are in social security and they are opportunities to tweak those. republicans and democrats nearly -- need to come to the table and examine those options. we will probably need them to

get the system into balance. host: the white house yesterday had put out a statement saying congressional republicans have advocated for cutting earned benefits. their policies would privatize dire and social security rates and t rirement age or cut benefits. he says house republicans refused to raise revenue from the wealthy but strengthen earned benefits programs. is that a fair characterization? guest: we will need some of both. we will need the wealthy to contribute more than they are today area we will need changes on the benefit side as well and for both sides to say any tax increase will kill the economy or the other side saying any benefit adjustment will throw millions of seniors into poverty, that's just not the case. the more both sides continue to

use talking points and view the issue as a cudgel, the less likely we are to get any kind of progress. to be more optimistic, there are serious conversations owing on in the senate right now around social security that are much-needed because that graham, the trust fund is projected to be insolvent in a decade area in 10 years, if congress doesn't take action, there would be an across-the-board cut of about 25% and everybody's benefits. that's unfathomable and we cannot let that happen. the sooner congress acts, the more gradually they can phase in those changes. i am encouraged by the fact that they were these earnest conversations in the senate across party lines and i'm hopeful there'll be some type of package that comes out of the trap this year to advance those conversations and hopefully see some reforms in the next couple of years. host: when it comes to social

security and medicare, is there a least painful approach of changing these programs to preserve their solvency? guest: absolutely, there are reforms we can put into place they go into effect many years in the future and gradually and are targeted at the people can afford the most. all of those are things we should welcome. less time social security was informed in the early 1980's, they put in in just retirement age increases that just finished going into effect recently. those were 30 or 40 years. we have time to do phase in's to make sure people on the program have limited or no impact on the benefits and people early in their careers were coming into the workforce will see modest changes to how their benefits are calculated years down the road area that's what we need to do on the benefits to make sure there are enough revenues coming to the program to funded and that will mean modest tax increases especially groups of people who can afford it most. host: if that's the case and

you've west is for a long time, if solutions are easy, why can't congress come together and enact these? guest: it's politically unpopular. it's much

caller: and let that be the way we get out of this terrible debt problem. we have did it once before. how come we can't go back and analyze the mechanics of that time and reapply it to today. thank you. host: thank you, caller. guest: very good question.

do i think we should look to history for lessons we can take away to solve our current problems. there is a couple dynamics that make this situation today very different from what we have historically, even though we do have similarly elevated levels of debt. after world war ii, we drew down our forces and spending on our military dramatically as well as other programs that were supporting, domestically supporting that effort overseas. it made for a natural opportunity whereby our debt came down. that wasn't the entirety of the solution, but it made up a lot of the reason why our debt went from well over 100% of g.d.p., over 100% the size of our economy, to much more sustainable levels. today we have a situation where we don't have that large conflict overseas, we are spend ago lot on our military budget, but it's not near the order and magnitude of world war ii. that's one distinction. we don't have that easy ability to draw down our defense forces

and make a dent. the demographics we are facing are tkeufrpblt right now we have a situation where our older americans are increasing rapidly. people are going on to social security social security and medicare, that's outpacing the people paying into the programs. the working americans, taxpayers contributing to social security and medicare right now. we expect that trend to go on for an additional several decades. as well as the fact that over the longer horizon people are living hropber and longer. they are spending more and more years in retirement collecting those benefits. to change that we are going to need reforms that really fundamentally reform the basis tell. we can't -- base system. we can't keep doing that otherwise we have to raise taxes. we need more revenues into the program, but we'll have to make some adjustments to the benefit trajectories. host: you talk about history, take us back to 2011, president

obama face ago similar situatior situation. with debt control. what does that do and how was it as a solution? guest: with the bipartisan policy center working on the debt limit for about that long, 12 years, because the first time in the modern era where it came up in the political fashion that it did was 2011. that was when republicans were insisting on particular budget reforms in exchange for extending the debt limit under president obama. that summer there was a very protracted debate over how we were going to get this done. ultimately they did pass a debt limit extension. it was very close to what we call the x-date, the point which the government would not be able to meet all its obligations in full and on time. that led to a credit rating downgrade by s&p. which had ramifications both in the short-term and longer term. what that agreement, the budget control