>> brawl. now live from our nation's capitol neal vavuto. >> man, we want to bring you up to date on the latest headlines. believe it or not, tax hikes are back on the table. we have the headlines right now. senator hairy - harry reed reedd and the senate planning to go over his plan and looking at tax hikes and revenue enhancers . also look being at deeper

spending cuts potentially to win over republicans. that might be legislation nongrata for the house of representatives where it may be dead on arrival. that's what they are looking at. the president's approval rating as the house starts is all-time low of 40 percent . other surveys have him in and around the neck of the woods. congress approval ratings are tumbling and his is more pronounced. believe me, congress is in no position to brag. congressman, they will come to a deal but not to your liking, explainn. >> there is such pressure and anxiety to get something done, there is an obsession with the august 2nd deadline. >> is that a real deadline? >> i don't believe it is. you and i have talked about

this. it is a floating deadline. we have government renues to take care of what we need to. we need to get it right if we have to go a few days, let's do it people are up here so long, they are in a menitality of getting something done . they are easily panicked. mitch mcconnell plan. i am trivializing. congress tends to flat them down and if he raises the debt limit in ways, if they don't have the numbers to counter them. two-third and the debt limit gets passed. you wouldn't like that? >> not at all. i offered a letter and 87 of my colleagues said don't pass a mcconnell plan. it accedes our ability to deal

with the issue. mr. president we disapprove and let's move on but raise it. >> presumably buying time to come up with a deal. i know how that goes. where do we go. in that event our debt is downgraded regardless. >> there is a decent chance it will be downgraded regardless. we pass cut, cap and balance last week, the credit rating said that was the only plan on the table that met the criteria. >> it went no where. senate tabled it as they tabled boehner last night. you guys are coming back and essentially shooting down a facsimile of the reed measure. it looks like we are playing tennis and keep batting balls. >> are they just wasting time. >> we missed our opportunity for real reform. >> is it to say which body.

the house or the senate? >> that's what harry reid is trying to do. the only act in town has been the house. the president has been leaderless on this and the senate hasn't passed a budget in days. >> the rating agency is downgraded. >> probably. >> and would you be okay standing for principle, forcing that issue and your critics would say you have forced the issue. >> i think it happens regardless. anything shy of real spending cuts . they gave us an idea. we were looking at a downgrade. >> and all right. i have audio problems in my ear and hearing voices. but thank you, congressman you are smarter on these subjects.

>> don't bet on that. the issue of holding triple a securities and they are downgrade a lot of institutions have the triple a. you have to get rid of it. there is a statute from what barney frank was saying that is not the case. that could give institutions wiggle room or not? >> i don't think that dodd frank can override a mutual fund perspective. the by laws say you have to hold a certain amount of triple a securities. be honest about the debate. we have one rating agency moody's investor service that came out yesterday and said unless we default, we are likely to keep the triple a. s&p. it sounds like they are going to downgrade and let's say s&p lowers us to a double a .

that is a split rating? i covered the bond market all of the time and institutions go with a higher rating. i will say this, neal and your last guest hit the nail on the head. we have a chance right now to do some good things and cut the budget. this august 2nd deadline. >> we are going to be up against the deadline. >> it may not mean anything. we are not going to default. people are going to get their social security checks. >> i am sorry we are having serious audio. and we remind you we are back on sunday with special coverage especially your world.

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welcome back. the latest sort of the news. news is just gozip. we are a long way from enact being anything. but the latest talk is that the senate is looking at another trigger attack to woo more democrat votes for the measure in the senate. is it a slam dunk at all and conversely to win over the republicans, they would look at deeper spending cuts than the ones envisioned and up front them a little bit more. a lot of republicans said no, that doesn't cut it. mike emanuel is following the

soap opera. what do we make? >> the sticking points are the triggers. in english that is enforcement. what forces them to make substantial cuts down the road. three republicans and democrats in the house and in the senate. but what if they can't agree? democrats say we put tax hikes as a trigger to force republicans to the table . republicans are saying spending cut to force the democrats to the table. it is a scum with senator chuck schumer. we have to have tax hikes as a trigger. why would we put a sacred cow on the table and not have the republicans do the same. we have debt-cutting deadlines to meet them every year. if we are not getting there,

we want the option of being able to raise taxes to get us there. and republicans want the option of deeper cuts to get us there . there in lies the rub. >> why are we here on saturday. washington has trouble getting it done. they are saying we have to have reall triggers and enforcement mechanisms to say get back to the table and get it done and they don't want to raise the debt ceiling for the next two years and there is no real spending cuts. >> do you think that it will be all subteruge and drama ahead of a mitch mcconnell deal and he raises it and they balk about it . they can't raise it because the numbers are not there. >> my sense is, you need plenty of postering between now and tuesday . they realize let's not mess with the united states economy and raise interest rates on

anybody. you know the economic better than i do. they don't want to be the guy whed first. there is probably private discussions going on and we heard other members talking about what is acceptable in terms was a compromise and they were not going to give reid everything he has. >> senate has 30 hour rules and just to start on that brings a deadline . so can they logistically get something past one way or the other with their own rules in place? >> i think senator harry reid is saying i will support the boehner plan and reid plan and it is time to move the country forward. >> any deal . i think he realizes eight or nine problems, i can get it done and then get mcconnell on board and the senate is coming

together and now the house should come together. >> it is we're. i am trying to get the notes on what they could be discussing and the fact of the matter everything is up for grabs. you can hear me regurgitate the notes like the expert outlined. wouldn't it be great if the congress went through that like mike did. >> it is great to have you here. and running out of the money.

>> i am congressman joining us. a tea party favorite. but you were not the tea party candidate when you ran against seven thousand other republicans. >> it gets with those values. >> and people who preach those values, the tea party are not a happy camp. i know there is a lot of tea party congressman. but one of the groups are saying, i am watching their votes and if they go for the boehner measure we'll remember that . anything that calls for a revenue hike or something i guess, that is what the senate

is kicking around, they will remember that. what do you make of that special? we want things to move faster and the plan we put forward in the house was not going to solve all of the problems, but this takes time and it is what the boehner bill did. dick >> you voted for it. >> yes i did. >> is there any retribution. >> people want to have things get through the house and senate and signed by the president. but we have to look at reality and make sure we are moving in the right direction. we are not getting everything we want all at once. >> what is your sense of a deal imminent or not. >> i don't know. >> you are the first one who said i don't know. >> i mean, last night we had the senate act faster than i ever seen it act in the entire

life. within two hours it knocked it out. >> now you are saying a facsimile of the remeasure that they will talk about. you guys want to take up and reject and send a message back to them. >> we don't know if the remeasure will get cloture in the senate. the republican senators are holding strong on it and not allow it to advance. >> also there is parlimentary measures to move around that. >> you think the rating's agency is downgraded even if a deal is putting together we are looking at a downgrade end of story. >> that would be detrimental. but interest rates are not determined by s&p but demand for treasuries. >> but the fact of the matter, markets are going to be

responding to the rating's agency will do. >> i don't know how much affect it will have. where else will they go. uk or france. >> that is a cava lier bet. >> we need to get our country going in the rit direction and can't moody's mign grade us. wee to tackle our fiscal problems and we just got downgrade see what the riellity. it is the market who determines the interest rate. >> you don't think there is a civil war amongst the tea partiers and republicans in name only types. you know it is wid than that. , we are all in this together and we have the same ideals and looking to push that ideal. we have different strategy. some are getting it all at once.

others are saying we don't have the senate or white house. we'll get what we can get and move the country in the right direction. there is not a sces'm of idea but strategy. >> congressman, thank you very much. >> good to see you. and we have more to follow as we debate. the congressman was good enough to say he didn't know. but the fact of the matter we don't know. a lot of folks don't know how it unfolds. the reid measure is coming up in the next couple of hours and the house will preferably shoot it down and the pressure builds after midnight when the reid measure that calls for cuts and more to follow up in that and helps with the commission. they love commissions here and it is not a done deal . right now it is looking like an iffy deal. we'll have more after this.

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>> all right welcome. we are a little disjointed. i am technically in the dark here and my communication with the control room in new york and guests in new york are down and we are trying to work that through here. i apologize if i seem more than the usual crazy, disjointed that is now added by a factor given the heat here 100-fold . my friend manual is here to be and pick up the gainsmanship. >> on the senate floor senator m conle said let's vote on your bill and i talked to an aid of mcconnel we'll gladly vote on senator reid's bill .

prove he doesn't have 60 votes. >> he knows that . so what he is trying to do. figure out the sweeteners he can give the republicans in the senate to get the 60 votes to send it back to the house. >> they shot that by looking at a trigger by including tax hikes. >> orrect. what do they do for triggers because the american don't have faith in congress to cut the spending and raise the debt ceiling and bottom line that's what we are stuck on. >> and if they come up with a deal and agreement. they are keeping an eye on wall street . stocks did tumble four plus percent. there is not a melt down type reacademies. nothing like when the first tarp measure fell under president bush. it will take something like

that to get them off of the dime or do you worry if they rush to a deal. >> some people suggested that that is what it may take. >> hopefully not. they are voting after hours. boehner plan ended up coming up at 6:00 p.m. last night just in case there was not a market reaction or if it went down in flames . so they are being careful and doing a lot of work over the course of the weekend and talking to the senators, it sounds like they do get it but where do they compromise and figure it out? >> as we said earlier, mitch mcconnell seems like the hero of the day or back up plan of the day and could be honest, with the president to raise the limit and move on. will they see it as a success or failure? >> that's washington, stock is

up and down and personal stock and in terps of power, boehner's stock was threatened if he couldn't get it through the republican house. >> talk about the games manship. why risk the political capitol for a deal that he knew would be shut down in the senate. >> my sense is because washington said he couldn't get a republican house to vote for him. some led with an iron fist and years ago, what is it that it in your district. >> they can't do it. >> and his style is not the iron fist style and do it for the good of the party and country and show a balanced budget amendment as the votes in the house and force it in the senate and we'll debate it another day. >> thank you very much. mike emanuel. all right. that is where we