>> schieffer: today on "face the nation," deal or no deal? both sides are finally talking, but is there an end in sight? it's day 13 of the government shutdown, and the good news is the backroom meetings are going on. the bad news-- the house seems to have given up and is looking to the senate to fix the mess. we'll have the latest on the negotiations and talk to key senators including arizona republican john mccain. new york democrat chuck schumer. new hampshire republican kelly ayotte. and tea party republican congressman tim huelskamp. and with the republican approval ratings tanking, what is the way forward for the g.o.p.? we'll have analysis from an all-star panel including former speaker newt gingrich. former clinton press secretary dee dee myers.

"wall street journal" columnist kimberley strassel, and dan balz of the "washington post." it's shutdown city in washington, and we'll bring you all sides because this is "face the nation"." captioning sponsored by cbs from cbs news in washington, "face the nation" with bob schieffer. >> schieffer: and good morning again. well, it is day 13 of the shutdown, the debt limit set to expire in just four days. we're going to start this morning with new york democratic senator chuck schumer. we'll hear next from arizona republican john mccain. senator schumer, i want to start with you because yesterday-- i mean, you were in all the meetings. you met with both the president and the senate democratic leadership, the senate and republican leaders. you were there talking to mitch mcconnell on the republican side. where are we? >> well, bob, i'm cautiously

hopeful, optimistic that we can come to an agreement and open up the government and avoid default based on the bipartisan meetings that are going on. >> schieffer: well, what's the sticking points? >> the good stuff is senator mcconnell and senator reid both understood the gravity of afault and mao we had to avoid it, and while i don't want to get into details, the frameworks they each had were not that far apart, a lot closer than, say, house republicans and the president. it's also very good that there are bipartisan groups meeting. i really respect what susan collins is doing. and that will-- that will help bring things about. so here's what i'd say-- with the president, with senate democrats, with senate republicans, there's a will. we now have to find a way. we know the house won't find that way. so the whole-- all of it rests on our shoulders. but finding that way is hard, but we're not out of the ballpark in any way. >> schieffer: what about

undoing the sequester? i keep hearing that's the most important thing to the democrats. what does that mean? >> that's one of the sticking points. look, neither democrats nor republicans like the sequester. and one of the strongest voices against it has been ?aerlt mccain, correctly, which and what it will do to defense, which he defends so dearly. the dispute has been how to undo the sequester. republicans want to do it with entitlement cuts-- in other words, take entitlement cuts and put that money into undoing a part of the sequester. the democrats want to do it with a mix of some entitle ams and revenues. how do you overcome that dilemma? we're not going to overcome it in the next day or two. but if we were to open up the government fair period of time that concluded before the sequester took place, which is january 15, we could have a whole bunch of discussions, and i am more optimistic than most we could come to an agreement. that was one place where the house republicans and the president were not at total

loggerheads and a lot depends on how you define revenues and how you define entitlement cuts. the plan would be open up the government immediately for a period of time before the sequester hits, and then have serious discussion where we might be able to undo the sequester. i'm optimistic that could work. >> schieffer: aren't you going to have to find something that you can give to speaker boehner that he can take to those on the right side of his party and to bring them along? i mean, i'm not sure what that is, but-- >> yeah, well, you hit the nail on the head. no one's sure what will bring those people along. i think there's a feeling among senate republicans, whether it be senator mcconnell, senator mccain, senator collins, that if we can get a broad bipartisan majority to pass something in the next few days, it may help crack the logjam in the house. and, of course, speaker boehner wouldn't get the 40 or so people on the hard right to go along, but could get a lot of his

mainstream republicans. i'd say this-- i think these mainstream republicans are getting fed up with the tea party and ted cruz. they see where it's leading them, to very low poll numbers. this idea that unless i get my way i'm going to do huge damage to our credit rating, to millions of people who depend on the government. it isn't working. and i think there probably is a new mode in the house. speaker boehner can't lead, but if the senate leads, i believe he could follow our lead. gloab because i mean the reason i brought that up is, i hear republicans saying to me, "look, you may not like speaker boehner. you may have all kind of differences with speaker boehner. but if he is toppled and some of them are saying to me he could be toppled this weekend if things don't go exactly right, that what you'd get after boehner would be worse to deal with than trying to strike a deal with speaker boehner. >> john and kelly would know, and tim would know this better than me, but my view, is when

your party is doing as poorly as it has, mainly because they've let ted cruz and the tea party-type thinking lead them around, you break from that. and you may not have the ability to put together your own plan and move forward but you might have the ability to follow a bipartisan plan, such as we're trying to come up, senator mcconnell, senator reid, senator collins in all of us in the senate. >> schieffer: let me tell you the other side of that, i heard from people-- nobody will say this on camera-- but i was told you were very close to a deal thursday night or maybe early friday morning, and then that "wall street journal"/nbc poll hit, and showed that the public was overwhelmingly blaming republicans, and it gave some on the left, to the far left, more backbone. they said, hey, we've got the republicans down. what we need to do now is put our boot on their throat and break them. is that right? >> no, i don't think we were close to a deal is the problem. the issue you brought up of

sequest-- we have one other issue that's very seriously tout there. there's a disagreement, and that is how long the debt seale, should go. we think it should go for as long a period of time as possible so you don't go through this every few months and the plans brought to us have it in january or earlier. that's not good enough. there are real issues but they're overcomable. >> schieffer: senator, thank you so much. i'm going to the other side of the table, and senator mccain. senator mccain, do you see any kind of a path to a deal? >> i'm glad that negotiations are going on. i'm disappointed that twice they were close to a deal, and the democrats moved to go oppose, in light of the polling data. i'm very disappointed that the president of the united states has not played a more active role in this as bill clinton did back in '95. i am very disappointed that the

12 of us led by senator collins, senator ion the, senator mikulski, senator marchion-- we had a plan, and we wanted to present that plan. and the democrat leadership squashed it. we were ready to go to the press gallery, and the democratic leadership said no. and i still wonder why, unless maybe it was too generous. so i'm hopeful that we will get negotiations. i hope the president will become engaged. maybe we need to get joe biden owment of the witness protection program because he has good relationships withw-- >> schieffer: we haven't heard very much from him. let me ask you this, senator, do you think it is possible to get a deal that does not get a majority of the republicans in the house of representatives? >> you know, i don't know, and i hate to tell the house republicans what they should to. they resent it it, and i understand that. i once once in the house and

thought we were a bunch of snobs, which is probably true. the fact is they're going to have to understand that we're on a fool's err abando fool's errand when we say we're going to defund obamacare. now that has all changed-- and can i mention one other thing. the director of national intelligence said the schulte down is extremely damaging to our ability to defend this nation. look, al qaeda's not in shutdown. and when i saw, as you did, these death benefits not being given to families, i'll take-- everybody take the blame. but it's not acceptable to the american people. it's not acceptable. and we should be sitting down, and the president should be engaged, and the democrats, they better understand something. what goes around comes around. and if they try to humiliate republicans, things change in american politics, and i know what it's like to be in the majority and in the minority, and it won't be forp gotten.

now is the time to be magnanimous and sit down and get this thing done. >> schieffer: let me ask you this, senator, how is it-- i've been in washington a long time, you've been in washington a long time-- that a freshman senator less than a year in office, ted cruz, was able to lead your party into what some in your party are calling a box canyon here. how did this happen? >> i think the very extreme dissatisfaction that many people feel. there was already fertile ground because of those many members of the house who were elected in 2010 on the promise that they would repeal and replace obamacare. by the way, there are many of us who fought it back to 2009. we still at the present time changed. but to say that we were going to defund it just-- after the 2012 elections, every speech i gave all over the country, we'll repeal and replace obamacare. well, we lost. we still can fight provisions of

it, and the irony of all this is, the roll-out is a fiasco. that should be on the front page of newspapers. >> schieffer: what about ted cruz and the impact he's had? is that positive for republicans? >> oh, obviously it's very divisive in our party, but ted cruz is entitled to his views, and he's very articulate. he's very intelligent. and what we need to do is to have this debate within the republican party. and it's going to be a serious debate, and, look, i respect senator cruz. he didn't make any bones about what he was going to do when he came to washington. the question is, is should we follow that leadership or should we go in other directions and coalesce the majority of the american people? look, i guess we can get lower in the polls. we're down to blood relatives and paid staffers now. but we've got to turn this around. and the democrats had better help us rather than do what

they've done-- turn down two good proposals that they were about to agree to, and then, of course, this proposal that they just scuttled yesterday. >> schieffer: what do you think the sticking point is? >> the majoring point, is of course, sequestration. that's the key element, and i'm very worried about the devastation to our military and our defense. but at the same time, we do have to reign in spending. that's a major sticking point here. senator, thank you so much i want to go to new hampshire, and republican senator kelly ayotte, who is in man chevmenter this morning. she was one of those working with susan collins who came up with the plan. a lot of people thought it was going to be the plan to kind of break this stalemate and then it all fell apart. senator, where do you think this is right now? >> well, unfortunately, bob, i did think we had a framework for a plan. we had six democrats, six

republicans. something that would get the government open, address the debt ceiling, also some things we could agree on around obamacare exprirk to agree with what senator mccain said. we were close and then the senate democratic leadership-- and i believe the white house-- pulled back, and where i'm concerned, bob, is where we are now is that the defunding strategy was a zero sum strategy, and now we have a zero sum response. and the american people lose. so it's time-- i'm tired of the politics on both sides. time for us to resolve this. but again, the democrats did pull back from this. and it's unfortunate. i thought we were close to getting an agreement. >> schieffer: do you now believe that the government will go into dwe fault, that you won't be able to come to an agreement? when is it, wednesday or thursday that the deadline runs out? thursday, i guess it is. >> bob, i hope not. we can't do that. it's time to put-- get out of our trenches and resolve this, and we need presidential leadership to resolve this.

i can understand the american people are tired of this. and, again, i think the zero sum politics is not good for anyone. it's not good for the american people. so i hope that this bipartisan agreement can be resurrected. we can get this resolved. we can get the government open, and, ocialg also, deal with the debt ceiling issue while talking about our underlying fiscal challenges. we still have $17 trillion in debt. >> schieffer: do you think-- the same question i asked senator mccain-- do you think there could be a deal that could come through the house that does not enjoy the majority of republicans in the house? do you think that such a deal is possible? >> well, i think that's the challenge for the speaker of the house. and, obviously, in terms of his leadership, it's important that he stay leader because who comes next in the house of representatives? we need to govern this nation

and solve the problems of this country. so i'm hopeful that the house can get their act together and come up with something that can pass the senate. if not, then the senate's going to have to do it. again, we were close to a bipartisan agreement, and i hope that the president leads on this. that it doesn't just become this political game. >> schieffer: what do you think the fallout is going to be from ted cruz? some people say he has led your party into what amounts to a box canyon here, into a place where there doesn't seem to be anything out. do you-- what's your evaluation of the impact he's had? >> well, i believe that defunding strat joint chiefs of staff a failing strategy from the beginning. it's not something they supported. although, i opposed the health care law, and we've seen the flaws with the law as it's been rolled out. but look where we are. from the beginning, the government is shut down, obamacare exchanges have still opened. so i just disagreed with the

strategy. i think it's time for conservative problem solvers to move forward, to govern the nation, to get things done. that's what ronald reagan did. and i think that's what we need to do as a party. >> schieffer: all right. all right, well, senator, i want to thank you very much for being with us this morning. and i wish you the best of luck. we'll be back in one minute to get a tea party analysis of all this. i'm beth... and i'm michelle. and we own the paper cottage. it's a stationery and gifts store. anything we purchase for the paper cottage goes on our ink card. so you can manage your business expenses and access them online instantly with the game changing app from ink. we didn't get into business to spend time managing receipts, that's why we have ink. we like being in business because we like being creative, we like interacting with people. so you have time to focus on the things you love. ink from chase. so you can.

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exceedingly unpopular, and clearly unworkable and remains unfairp. the last offer we sent to the senate was two weeks ago. they have yet to have a recorded vote. and i find it interesting listening to senators talk about what they might do. the house has passed 15 appropriations bills to keep the memorials open, take care of the veterans, take care of our troops, and the senate just sits there. at the end of the day what we have accomplished is not much yet. but we have to focus on obamacare, and we also have to focus on the underlying problem that's been ignored for years, and that's too much spending. >> schieffer: but, congressman, don't you have to focus on keeping the government running? nothing can happen until the government is running. and this idea-- i mean, people do this from time to time, but the idea that you can kind of put a wish list, attached to legislation to keep the government running, why is that a good idea? >> well, bob,un we've sent bill after bill to the senate.

and they've rejected it. they chose to shut the government down over two issues. they did not want to extend the same break that the president gave to big business, did not want to extend that to the rest of america. and they also wanted to maintain their gold-plated health care system just for members of congress. i think those are two very unpopular approaches from the senate. but at the end of the day, we've got a spending problem, and we have a debt ceiling and it's approaching. the debt ceiling is note the problem, bob. it's the fact they've been spending about $1 trillion more than they're take next. i think most folks are tired of not only the games in washington, shutting down the world war ii memorial, and more importantly, which is why the tea party took off is they think washington is ignoring the underlying problems of spending too much money. >> schieffer: if i could interject. i think you may have a problem coming that may be worse than all of that. if the government has to default on its debts and the term, "full faith and credit of the united states government" is no longer

operative, if that happens we're going to plunge off into the unknown. nobody knows what the impact of that will be on not just our economy but the world economy. would you be willing to let that happen in order to postpone obamacare, which you haven't been able to do. obamacare marches on, not marching very well right now, but obamacare has started. and all of the rest of this is happening. are you willing to let that happen to prove this point? >> bob, i know you are probably surprised to hear me say this, but i agree with joe biden in august of 2011, the last time we had this type of crisis, joe biden admitted in china to our folks over there that there will be no default. it's not going to happen. there are no payments due on october 17 to pay our creditors. there are no payments due until november 15. that's why moody's has indicated it's not going to have a major impact. >> schieffer: congressman,

congressman, i don't want to interrupt you here, but that's not what the secretary of the treasury said. that is not what he reported. that just is not-- you tell me. >> well, he said a lot of things a week ago. i i think-- clearly the white house is trying to scare the markets. i think that's unfortunate. but at the end of the day, the reality soctober 17 is a date that will not have a major impact unless the white house is able to create concern about that but the real concern is not raising the debt ceiling, bob. it's as senator obama said in 2006, it's an idea, it's the result of failed leadership. they're spending too much money in washington, and this idea that we're going to continue to maintain a $700 billion deficit. that's the current position of the senate, and the president is to continue these massive deficits. i mean, the frustration i have, and i think most americans have is not only the games but more importantly the ignorance of the

major problem-- a $17 trillion debt, trillion dollars worth of deficits every year for the first four years of this administration, that's why during the debt ceiling proposal last week was to say let's talk about entitlements, let's talk about how we can get our spending under control, not in the short term, not this week, this year, but in the next decade, and that's yet house republicans are pushing for a plan to balance the budget in 10 years, and obamaed cace cannot be part of that plan because it blows a huge noel our deficits. >> schieffer: okay, i think you've made your point. you're not backing off. you're not budging a bit. all right, well, thank you very much, conclud congressman. we'll be back with personal thoughts on another is very strange week in washington. it's a growing trend in business: do more with less with less energy. hp is helping ups do just that.

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