. i'm margaret brennan in washington. this week on "face the nation" -- debt crisis averted. now what else can a divided washington accomplish for americans and the economy? president biden signed the bipartisan deal to cut federal spnding and suspend the nation's debt ceiling, just hours before what could have been a catastrophic default. >> no one got everything they wanted but the american people got what they needed. >> we'll ask two deal makers, west virginia senator joe manchin and louisiana republican garrett graves about what's next for the country. bank of america's ceo brian

moynihan on how brinkmanship impacts an ever-changing economy. then, the field of republicans running for president is growing with one high-profile competitor diving in. >> our great american comeback will start by sending joe biden back to his basement in delaware. >> and more expected to cruise into the race this week. >> come this wednesday i'm announcing in iowa. >> we'll check in with our expert cbs political panel on what voters can expect as the race intensifies. overseas russia steps up its attacks in and around kyiv. can ukraine's counteroffensive put moscow on its heels? we'll check in with ukrainian ambassador oksana markarova all just ahead on "face the nation."

good morning. welcome to "face the nation." we have a lot to get to this morning, and we begin with republican congressman garrett graves, who led republican negotiators during the debate over raising the debt ceiling. he joins us from baton rouge, louisiana. good to talk to you. >> great to be with you. >> president biden said you all were respectful, honest and operated in good faith. do you see any sign on the heels of this that republican leaders can work with the white house on big issues like immigration reform and border security? is there momentum? >> look, the negotiations certainly were in good faith, but they also included a lot of candor. we had some tense moments throughout, but i would love to tell you we could build upon thus this. we certainly have a crisis in the energy case and immigration is a huge issue where we should work together. >> more democrats than republicans actually voted for the deal that you negotiated.

and it leaves largely intact most of the president's economic agenda. how can you claim, as you told my cbs colleague the other day, the white house got schooled? >> because the white house laid down about seven red lines, including they wouldn't negotiate, wouldn't allow anything to be done with work requirements, anything to environmental laws, they wouldn't allow us to take any funds from irs agents and on and on, and yet every single red line that they laid down, we crossed right over in negotiations, resulting in the largest savings in any legislation in the history of the congress. this is a huge accomplishment, huge legislative wins and when you look at the president's statements all he can do is talk about anything that didn't happen versus anything that did that was positive for his agenda. >> trillion to trillion and a half over ten years in savings. you said there was an erosion of trust within your own party between you and some of those

harder lined freedommbaiwa a ba this morning congressman ken buck of colorado said, speaker mccarthy has credibility issues, and while a motion to vacate won't happen right away should be concerned about being removed from office. how big of a problem is this right wing of your party? >> look, there were erosion of trust issues because folks went out and began attempting to define a deal while still in negotiations. there wasn't even an agreement struck and their interpretation or definition of the agreement, as you can imagine, was flawed. in with regards to speaker mccarthy let's be clear, this speaker has been one of the best strategists we've had delivering immigration, transparency, bill of rights and other legislation looking back on previous congress not one has been done, much less about ten huge wins this year.

>> 71 members of the house republican caucus voted against it.o cf1 o i know you had 67%. i mean you had the majority of your caucus, but 71, that's not nothing there. can you rule out a government shutdown in the fall? are these hardline members going to be emboldened on the back of this? >> margaret, let's talk about what their goals are. their goals are trying to change the trajectory of spending, transform washington, in a way that's more responsive long term thinking about the next generation and the fiscal crisis we're approaching. i don't think that should be a partisan issue. we should be on board with those objectives. in this case i think leverage was trying to be exercised that really threatened the economy in a large way. we've already seen under this administration the stock market has lost around $9 trillion in value hurting retirement accounts and families all across the country. we can't continue to see those types of challenges. i do think in the appropriations process, we are going to be working hard to continue the

momentum that we've gained through this negotiation, saving trillions of dollars. >> can you rule out a government shutdown? >> i'm not ruling out anything. it depends on how reasonable each side is. obviously, in negotiations it's difficult to predict, but i want to be clear republicans are going to demand continuing to build on the success we were able to achieve in debt ceiling negotiations, in changing the way that washington spend. >> well, i know you're one of speaker mccarthy's lieutenants here but when you hear a member go out on television on cnn and say he should be worried about his job, that he doesn't have the faith of the caucus, that's got to be concerning? that affects your tactics at a minimum. >> look i've known ken buck for years and certainly respect him. it is not a mainstream position, i will tell you right now. speaker mccarthy's position is absolutely safe. he is going to continue delivering wins for the country, changing the direction of washington and being more representative of the priorities

of americans across the country. i have no doubt his position is safe and we're going to keep marching forward, continuing to build upon the historic wins hes been able to achieve this year. >> to get what you're calling these historic wins, though, democrats would say republicans took the economy hostage. it was a pretty big game of chicken here to threaten default. fitch ratings is saying even with this deal, they still could downgrade u.s. credit outlook here because of political standoffs around the debt limit and last-minute suspensions before the x date. it lowers confidence in america. why was it worth possible wly damaging the benchmark of the financial system and the credibility? >> it's a great question and one you need to pose to the white house considering the fact that they refused to negotiate for 100 days, despite indicating otherwise. they're the ones that brought us to the brink.

if we had begun negotiations in february when the president and speaker had their -- >> it was a point of leverage -- >> we wouldn't be in this situation. we would have finished negotiations in months. >> take the debt ceiling off the table entirely, you've suspended it two years, what about a vote to get rid of it? >> no. i don't think -- >> you need the leverage? >> i think that it's really important, just like if you had a child that had a credit card and unable to pay their credit card that month you would step out inn and help them out, but i would have a candid conversation about reform of spending. the committee for responsible federal budget has calculated that every child or grandchild born in america today is going to end up paying about $4.5 million because of the irresponsible spending in washington. $4.5 million over their lifetime. that is absolutely inexcusable. we cannot continue on this trajectory. >> well, one of the things that

fellow republicans are criticizing is the fact that you adopted the biden defense budget, and the 3.5% boost which doesn't keep up with inflation. how do you justify that doesn't hurt defense? >> sure. >> republicans like lindsey graham are saying. >> yeah. yeah. it's a great question. so let's keep in mind that we're increasing defense by about $20 billion to $886 billion. when you take every other function of government it equals about $704 billion. there's no question in my mind that we can improve efficiency of the department of defense, the large-scale acquisition programs, whether weapons systems, aircraft, and others. we're all familiar with the toilet seats and hammer stories of the past where the department of defense was paying outrageous prices. we are going to continue ensuring that our war fighters have the upper hand while we also ensure that department of defense improves its efficiency. >> well, we'll have to have you back, garrett graves, we'll leave it there for today. we turn to west virginia

democratic senator joe manchin. welcome back. we really came down to the wire here. >> good to be with you. >> when you were -- >> it's a shame that we do that. >> when you were with us in march, i remember you saying, speaker mccarthy and joe biden, they just have to stop grandstanding and they needed to start negotiating. how much of a miscalculation was it by democrats to wait? >> i think it's harmful. it shows you that extreme left is pushing so hard not to even negotiate and not even talk about it, you know, just hold your ground, hold your ground. that's not who we are in america. the process of democracy -- >> they said that the republicans were hostage takers, right? >> how can you be a hostage taker if you're talking about shouldn't we recognize we have an unimaginable debt and how we got here so fast and so high at 31.a $5 trillion. trajectory out of sight if we don't do something. i want to get both sides,

negotiating teams credit. congressman graves and his team on behalf of kevin mccarthy did a wonderful job and when you have basically steve row chet shetsty and louisa terrell working on behalf of the president, those are good people. it's a shame we didn't acknowledge it much quicker, three months ago at least, and not come down to brinkmanship when it kind of throws the uncertainty into the market to where here we are, the reserve currency of the world market, has to have stability where people believe that it's safe. >> yeah. >> you can't play these games. >> agreed. well, you also got an energy project tucked into this, the mountain valley pipeline, which cuts through your state and also cutting through virginia and senator tim kaine said this was a slimy way to handle it, that was his word, because it bypasses the courts and have the government seizing land from people in a hard hit part of his state. how do you respond to that? >> first of all, tim kaine is my

dear friend and a good person. he and i were governors together and we understand both of our states very well. the southwest virginia area he's talking about is entirely my entire state is demographics along those lines. first of all, this has been under review for over eight years, eight years. for eight years basically a lot of this land has been purchased and people have been paid. fair market values. they negotiated and paid. next of all, it's gone through eight nepa reviews. eight. it's been in the court system nine times. then on top of that, margaret, these processes or these projects cannot move forward unless the ferk commission determines there is a need. now three times they have issued a need for this product as far as more gas on the market. jennifer granholm and this administration came out with a statement saying this is in the national interest. the people in the carolinas are paying ten times more than in west virginia for the gas we produce. that's ridiculous for them to

have that heck of a stranglehold on it. and also helping the rest secure national markets as far as energy, you have to be independent, you have to be secured. this is a great project that's going to help not only just west virginia, but the entire energy security system. >> okay. it's interesting because last month you said you were going to block all of joe biden's -- president biden's epa nominees until he halts a radical climate agenda but he just green lighted a bunch of products including this one. you've been critical of the president in recent months. does this change your point of view? are you ready to endorse him? >> well, the bottom line is, i'm going to work whenever i think that basically we're moving in the right direction. what you've just seen is basically the extremes trying to run this operation. the united states government from the far left and far right. it was the middle that pulled everybody together. it was basically reacting to the people saying enough is enough. >> that wasn't a yes, when i asked you about endorse him,

though? >> well, the bottom line is, i'm not involved in the political process right now, with all the things that we have to do. everyone thinks about politics first. i don't. we he an awful lot of work to n do and we still have permitting to get done. we have a geopolitical unrest around the world. we have to support ukraine. we have to make sure that we get our financial house in order and get inflation down. >> okay. >> if you throw politics in you won't get any decisions on any of that. i don't think we would have got this bill done. >> to get all those permitting issues done, because you only got a fraction of them in this bill, you want things that will speed up energy infrastructure permitting for fossil fuels and clean energy. do you need a second term? >> absolutely. >> do you need a second term to get those things done, another term? are you running for re-election. >> you have to continue to keep working. we can get it done now. we're on the brink of getting it done right now. we could have got it done last

year but politics entered and we couldn't. here we are. we got part of it done. we got some reforms done as far as permitting and now what we can do is basically make sure we're able to get the pipelines and the delivery system we need for clean fossil all over this country to be energy independent and also be able to invest in the technologies of the cleaner technologies with less carbon, but we need more transition. i'm for all energy snools you know why i asked it that way -- >> i can support this from wherever i'm at. >> wherever you're at. you know why. jim justice, your governor, republican, is coming for your job. he has declared, and i know you have said you're going to take your time until the end of the year to decide, but doesn't he have at least six month advantage here? don't you need to tell people what your plans are? >> here's the thing, margaret. you said about my job, my job is to do what i can to help the people of west virginia and support this great country of ours and defend the constitution. that's truly the primary cause of my job.

it's not for me to get re-elected. if i run i'm going to win. i'm looking at everything i can to basically help my country to be stronger, to be more moderate, more centrist governed, than anything i've ever done. that's what my focus is because i know that's where good decisions. look what happened here. we got clear to the brink, but this is the first time i've ever seen from the house working with the democrats, hakeem es rthynd his team, to make something happen. i read about that when it used to be tip o'neill and president reagan. now i've seen it. i've seen also president biden and his team come back to the middle getting away from where the left pushed him. basically it's the middle that brought them together. >> well, that's -- joe manchin, always more to talk to you. >> that's where we are. >> more to talk about and i want you to come back to talk to us when you make a decision about whether you're running for re-election or that other option you said last time you're leaving open possibly.

presidential run. >> everything is open. everything is on the table and not off the table. one thing i wanted to mention to you, we need a risk assessment, risk management team for the united states of america to get to this brinksmanship every time. we should be taking this on every day. what's the risk we're taking if we don't do that. >> i want to talk about that with one of our upcoming guests, ceo of bank of america. stay with us. abetes, i want to keep it real and talk about some risks. with type 2 diabetes you have up to 4 times greater risk of stroke, heart attack, or death. even at your a1c goal, you're still at risk ...which if ignored could bring you here... ...may put you in one of those... ...or even worse. too much? that's the point. get real about your risks and do something about it. talk to your health care provider about ways to lower your risk of stroke, heart attack, or death. learn more at getrealaboutdiabetes.com

. we've got some good news about america's job market this week, but there appear to be economic headwinds on the horizon. mark strassmann reports. >> the bill is passed. >> reporter: turmoil averted. while washington's treasured blueprint governing by crisis. >> the great news for americans right now is that we avoided the catastrophe of hitting the debt ceiling. the troubling news is that we came that close. >> reporter: like washington, the rest of us have bills to pay. good news first, spending consumers keiep creating more

jobs. employers added 339,000 jobs in may, gains in health care, construction, leisure and hospitality. but still not enough job seekers for restauranteur nick osbourne. >> we are in need of extra depth, and it has been hard to find that extra depth for sure. >> reporter: there were also layoffs in the tech sector and a sharp rise in black unemployment that pushed up the overall jobless rate. it's a snapshot of a complicated, wobbly economy, with stubbornly high inflation and the specter of a recession. pessimism is having a late spring to remember. in a recent gallup poll, 55% of people believe their financial situation is only fair or poor. half say it's worsening. fewer americans, less than two in three, have $400 squirrelled away for an emergency. >> and that's -- >> reporter: for house hunters that struggle hits home.

loan applications down 30% from a year ago. why? rising interest rates now just under 7%, tightening credit and cities like orlando have a startling lack of inventory. one third the sellers this market needs. >> don't want to leave because they don't want to give up their interest rate. >> reporter: for the first time in more than a year the fed is expected to hold rates steady at its regular meeting later this morning this month at least for now, uncertain whether this economy is stabilizing. margaret? >> mark strassmann, thank you. for more now we are joined by the ceo of bank of america, brian moynihan. good to have you back here in person. >> it's great to be here, thank you for having us. >> our last two guests talked about the fact that we came to the edge. what do you think is the financial cost here since america's credit rating is still in question? >> well, we had the one in 11, the one in 13, it's not good for the united states to go through

this. it's a political process. it's good they came to a resolution and it's good it's behind us and that has provided momentary momentum in the market and allows us to face real debt level issues ahead of us. >> some of the ceo of banks have talked about setting up war rooms and doing emergency planning. how much of an impact is there? >> well, it's -- because it's over, there was an impact. we were doing all that and we were prepared in case, you know, it didn't come out right. the good news it came out right and you heard talk about coming together in the center and voting it through. now we can move forward. there's still issues ahead of us and we can talk about those. >> do you think that they should get rid of the debt ceiling, as some ceos have called for? >> that's a political question. at the end of the day, we need to have a serious discussion about how much debt we can have in this country, how much we can afford and that discussion needs to go on. the debt ceiling triggers certain debates around it at certain times. it's part of the process of government and whether you're a

republican or democrat, they have to get together and do it and keep the financial stability and strength of the united states paramount. at the end of the day if we're not strong the rest of the world will not be strong. >> let's talk about that strength because the federal reserve is predicting a mild recession on the horizon. what are you seeing there in terms of how the consumer is behaving and where we might be seeing any kind of slowdown? >> so last time i was here it was the end of last year and we predicted a recession this year. we moved it out. it's basically third quarter this year, into the first quarter. a mild recession. unemployment gets up in the high 4% range. still very low by historical norms. and that's our core prediction. as you think ahead, what's going on now, the impact of the fed's tightening has had its effect. consumer spending 22 over 21 by bank of america consumers, 4 trillion plus a year, was up 9%. year to date it's up a 5%, thatels more c2%sisten growthnoa

2% inflation economy not a 4% inflation level economy, 4 to 5%. so the fed is getting the consumer spending level in line and now we have the jobs report and other things which sends confusing and ambiguous messages. the activity the consumer is more in line with what the fed wanted because the rate increases and other aspects have had their effect. quantitative tightening had their effect. >> you gestured that the prediction of recession keeps getting pushed out, like economists keep getting surprised by the data out there. is the prediction going into this presidential year ahead of us that we will be in the midst of a recession? >> i think we're at the point where the fed having tightened as much as it has with the impact of the failures of two or three banks which are different than a lot of the banks that failed, the impacts of the treasury funding has to come forward, the impacts of the

environment around us slowed the economy down. the question is inflation under control and right now, most people are thinking like in 1984 when continental failed and volcker who was fighting inflation having paused maybe the fed should pause and let the effects of this take hold and see what happens, but at the end of the day that has a slight recession. >> we're going to finish this thought on the other side of the break. stay with us. enters the room. phil: excuse me? hillary: that wasn't me. narrator: said hillary, who's only taken 347 steps today. 348, 349... hillary: i cycled here. narrator: haha! on an e-bike... speaking of cycles, mary's period is due to start in three days. mary: it is? narrator: and her friend hasn't washed his hands since... monday! yeah, i'd put that back. and then there's bill, whose heart rate rises to 115, nervous i'll mention... bill: my diarrhea? narrator: his chronic night sweats. linda: you sweat more at night than you do at the gym. narrator: which is rich coming from linda, who's wearing yoga pants but never does yoga! linda: i stretch!

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if you miss an interview or an episode, you can find it on our "face the nation" youtube page. we'll be right back. hi, i'm jill and i've lost 56 pounds on golo. hi, i'm barry and i've lost 42 pounds. jill and i are a team. if she tells me to do something, i usually jump on board. golo was doable, it's realistic,

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>> announcer: this is the "cbs overnight news." we begin tonight with new tensions between global rivals. today china's defense minister aggressively defended sailing a warship directly in front of an american missile destroyer. speaking at a summit in singapore he warned the west to stay out of waters and airspace near china's borders. the dangerous close encounter happened in the taiwan strait separating taiwan from china. cbs's elizabeth palmer leads us off tonight. >> reporter: addressing an audience of global security officials, china's defense minister, general li shangfu, had some blunt advice