gwen: averting a government shutdown. the debate, the tradeoff and why we're not out of the woods yet. tonight on washington week. >> lord, save us from ourselves. gwen: much talk of little action. >> republican house leadership have only a few hours left to look in the mirror, snap out of it. >> there's only one reason that we do not have an agreement as yet, and that issue is spending. gwen: a standoff that once seemed out of the question -- >> i'm embarrassed. this is the most dysfunctional place i've ever been a part of in my life. gwen: turns into high noon. >> for us to go backwards because washington couldn't get its act together is unacceptable.

gwen: but with compromise elusive and positions entrenched, the federal government lurches toward shutdown. we tackle all the outstanding questions tonight with jeanne -- michael duffy of "time" magazine, john dickerson of "slate" magazine and cbs news, and jeanne cummings cum -- jeanne cummings of "politico." >> award-winning reporting an analysis, covering history as it happens. live from our nation's capitol, this is "washington week" with gwen ifill, produced in association with national journal. corporate funding is provided by -- >> we know why we're here -- to connect our forces to what they need, when they need it. >> to help troops see danger before it sees them. >> to answer the call of the brave and bring them safely home. >> around the globe, the people of boeing are working together to support and protect all who serve.

>> that's why we're here. >> corporate funding is also provided by prudential financial. additional funding for "washington week" is provided by the annenberg foundation, the corporation for public broadcasting, and by contributions to your pbs station from viewers like you. thank you. once again live from washington, moderator gwen ifill. gwen: good evening. if you've been following the ups and downs of the budget standoff in washington this week, you are by now understandably dizzy. short story -- as of 8:00 p.m. eastern time, there is no deal. but all week there has been plenty of finger-pointing. >> it's time to take a stand. we need to say to liberals, this far and no further. to borrow a line from another

harry, we've got to say the debt stops here. >> i remain confident that if we're serious about getting something done, we should be able to complete a deal and get it passed and avert a shutdown. but it's going to require a sufficient sense of urgency from all parties involved. >> but we're not going to roll over and sell out the american people like has been done time and time again here in washington. when we say we're serious about cutting spending, we're damn serious about it. >> they can keep their word and significantly cut the federal deficit, or they can shut down america's government over women's access to health care. if that sounds ridiculous, it's because it is ridiculous. gwen: before this remarkable standoff is over, the week's

budget debate will have touched on almost every imaginable political and policy third rail. but the question is, how did we get here? how did it get to this? >> if you look at this deal that has yet to be really iced, you have a relatively small amount of money, maybe 1/100th of the federal budget. so it's really not about the money or the riders -- various riders that were attached to the bill in the end. it's really about a dry run, a dress rehearsal for a fight that's going to go on all year long, and that's about the longer-term structural deficit and debt problem we face in the country, what to do about entitlement spending and whether both sides can make progress on this small amount of money can tackle this larger problem. gwen: let's bring our viewers up to date which has been happening here, which is not much late on a friday night.

lots of closed-door meetings, lots of promised announcements which faileds to materialize, which leads me to believe that the deal is not as simple as they thought it would be. >> it's been a complicated process, that's for sure. the rough outlines -- it appears as though there will be a short continuing resolution so that they can put the finishing touches on about $40 billion in cuts. and they seem to have resolved some of the rider issues on climate change, clean water and abortion with perhaps studies that would come and probe those issues in more depth. those are the rough outlines we know about now. the speaker has to sell this now because he has said he wants to pass this with republican votes. he wants 218 of his 240-odd voting for this, so he doesn't have a lot of room for error.

and it may take him a while to bring everybody onboard, if indeed this rough outline is indeed what the final product becomes. gwen: and that's the truth. there is no deal until there's a deal. and there have been sticking points all week long, which have made the deal farther and farther out of reach. >> there are two parts of this deal. there's the number we've all been talking about, and that number has grown. gwen: from what to what? >> last week it was $33 billion, and john boehner wouldn't admit to that number, and here's why. republican wanted him to say here's a number and say all we have to do is meet that number. however we choose to meet it -- gwen: the number being the amount of money that would be cut. >> exactly. the amount that would be cut, which is just to run the government for the rest of this year. so that was the size of the cuts. boehner said it's not just about a number, it's the kinds of cuts, and that's the riders that are in here, some which are important to his republican conference and those dealt with the environmental protection

agency, health care, with planned parenthood. every time the democrat family said we want those riders to go away, then the amount of cuts had to go up because boehner -- it was like a seesaw. he knew that in order to get his caucus to get all of them to vote for it, he would have to by them off one way or another. if he was going to disappoint them and say you couldn't get what you want on abortion, they say you better have brought us something, which means greater cuts. gwen: so as far as we know tonight, the debate was to get this planned parenthood rider, the rider that would deprive funding for planned parenthood, which they argue they provide services to women and part of those health services are abortion, whatever. the point being, in order to get that out of there, which democrats and women in congress object to, they are saying you're going to have to come up with some more cuts. >> and the cuts are going to have to be greater in number -- the planned parenthood portion was a cut itself, but the cuts

to buy it off, essentially, in order to remove it, you have to get a larger amount of just total cuts. >> ransom. >> yes, exactly, to buy off the item. gwen: it was a $300 million cut for planned parenthood and it might be three times that. >> it does look like that. that's why i think also this week, when you had -- and especially today, when you had democrats saying they're going to shut the government down because they're fighting over abortion and women's health issues, social issues. and you'd have the retort from the republicans, know, we're talking about cutting spending. that's what we're fighting over. the last sticking points are about spending cuts. and both sides were talking about the same issue, but from their own perspective. gwen: and for their own reasons. >> exactly. because the cut to planned parenthood was that that was the republicans saying that's $350 million we want to cut, and the

democrats framed it as, but it's women's health that you're cutting. >> all those details are right, and yet, i sometimes have thought watching this unfold that it has far less to do with the details than it did with the context that both sides are on. ing under. and let's not forget, this is the first cut between president obama and the house led by republicans, led by john boehner. you know they have a long year, maybe two years at least, of battles to come. and this is really the first time they have clashed, met on the battlefield, so to speak and both sides are very conscious, i think hyperconscious, of who blinks first, who is the one who is seen by their own right flank or their own left flank, if they're the white house, to have conceded. >> you're exactly right. and that's why the small amounts of cuts, what john boehner is getting challenged from his right, those folks are saying, hey, if we buckle on this, we're going to buckle on the bigger issues.

so we've got to stay strong. but then what the house leadership was saying was, wait a minute, this is our first big test. we have been saying we're the adults in washington. we have to meet the minimum standard of adulthood, which is keeping the government open. so don't get -- you know, their first test was to show responsibility as new leaders in washington. that was the way the republican leaders saw it. gwen: we're hearing now that some of the networks are report ing that they've come up with a short-term deal to keep the government running, but not necessarily to solve the long tirm problem, right? >> this may give them -- a short-term deal gives them time to approve the deal with requirements that it takes. this is merely, as john was saying, for the current fiscal year. they have to come back and look at the next fiscal year in fairly short order, and before that, they have to solve an even trickier problem with raising the debt limit and that's not at all addressing the long-term structural debt problem. so they have a laddered set of

challenges. that's another reason, if they come to an agreement on friday night or on saturday, they're mindful that they have to turn around and make an agreement again. gwen: you know what's really a dilemma for both job boehner and barack obama -- john boehner and barack obama, and the democrats and the republicans. if they're going to get to the point tonight where the government shut down, there were never going to be any winners in this kind of a debate. why wasn't there greater incentive earlier on to where they ended up tonight? >> i think everybody needs a deadline. i think deadline pressure -- gwen: focuses the mind. >> yes, it does, in a negotiation like this. now, they really have pushed it to the wall, in part because of this last deal that had to be made. and judging from what we were hearing a few hours ago and what we hear now, it looks like boehner got $1 billion for the planned parenthood, $300

million. so it's not such a bad deal, if indeed that's what it is. so i think part of it is that. i think there was incentive for all three of these leaders -- the president, the speaker and harry reid over in the senate. they had great incentive to not shut the government down. and the president obviously is worried about the economy. it's slowing down. and he wanted -- he wants to be the grownup in washington, too, so he wanted to be able to say he shepherded the congress past this crisis. boehner knew what happened in 1995. he doesn't want to reset the political landscape. so obama is on a flight plan to re-election, when this fragile new majority is also up for re-election and reid has many vulnerable players for 2012 as well. so there was indeed great incentive for the leaders to get

this done, and they never left the table and they never attacked each other, and that, i thought, was really interesting in this. reid attacked the tea party, but he didn't attack boehner. boehner said good things about reid and the president. >> and they did those joint appearances as they were negotiating all along, which something changed for democrats here. when they did the first extension of government several weeks ago, the democrats were saying, we are under pressure because the country thinks we don't even think there's a spending problem. so when republicans say that the democrats aren't even serious, that hurts. as one advisor said to me, you know, the country is in an axe-cutting mood and we need to get to that place. once they started having negotiations and there were all these picture of e.r.a. reid and john boehner, -- harry reid and john boehner, they knew they were serious. that made it harder for republicans to say they're not serious at all. it then became about the specific kind of cults, which made it a less easy political

position for republicans to paints the democrats as out of touch. >> having watched a bunch of these deal-making conferences over the last 15 years, i can tell you that the dealmakers have a way of getting separated from their caucuses. even though they can come out of days of frustrating negotiations and sometimes go back and not actually be able to sell what they have wrought, ambassador that's one of the downsides of this last-minute deadlines that both sides of playing. it doesn't leave you time to miss calculate. and these kinds of judgments you make, i'll take a 3-1 turn, a 5-1 on a rider, you're really playing a very high-stakes game. so we'll see if we can get these passed. gwen: all of us were covering washington in 1995, the time of the last big government shutdown and there are similarities here. it's natural for us to immediately compare it to what we know. but it seems like there are a lot of dissimilarities here as well, not least among them, the fact that the economy itself is so weak and that there was an

argument that the white house attempted to make -- i'm not sure if they did effectively -- that this shutdown would not only close the zoo, but would also hurt the economy. >> well, that's right. the problem with that is that while the white house thought that this would hurt the way people thought about congress and maybe even congressional republicans in the short term and that they couldn't get their act together, they knew that if this hurt the economy -- and they weren't quite sure. talk to economic advisors at the white house and they say we don't really know how this is going to play out. but they worry about this squishy thing, business confidence. the idea that if it looks like washington can't get its act together on this, how can washington get its act together on the bigger debt question? and that will affect business and the way it makes its choices. gwen: the federal housing administration would not be able to close loans. >> yes, that would be direct, and lots of federal employees affected. so this was spooking them and that was always something that was really pushing the white

house to get involved here. and as we said, with john boehner, too, nobody wanted to be stuck with that. gwen: did the white house get effectively involved? >> they certainly were involved more so than it appeared. obama himself was not sitting at the white house. but his own director, jack lou, was definitely in the meetings and in close contact with the senior aides who were negotiating on behalf of the congressional leaders. and so the white house was as involved in all the details. and then there were times when the congressional leadership actually said, look, we just want to talk with each other. would you all please go down the street and go have lunch. so it definitely was involved. i think when you mentioned the differences with 1995 and today, a couple of other big ones, the wars. we were not in wars in 1995. so this late pressure that came on congress about the payments

to soldiers was a really powerful point. gwen: and newt gingrich and john boehner are just not the same. >> very different people. gwen: and a lot of what happened in 1995 -- and the reason why it backfired, had to do with newt gingrich and his personality. >> the fact that newt gingrich had given boehner a road map of where not to go, he in some ways has a more difficult caucus on his right flank, than newt gingrich did, which is saying something. but he had the advantage of having followed gingrich down this path and probably -- it's a little early to say, but he probably knew where to stop. whereas gingrich never saw stop signs, saw himself as almost an equal partner. saw himself as the government in 1995. and dared clinton to go all the way to the wall and shut down. in fact, i think gloried in the idea of a shut down. boehner never has done that. gwen: what do you see that's different?

>> the president's role in this. in 1995, it was clinton and gingrich across the table from each other. in this instance we have the president, president obama, who was irritated this week, when he came out in his press conference and said he had to get in the middle of this spat that was going on between these children. and he was irritated, but, of course, that's kinds of his pitch. we saw that last year when there was a debate over extending the bush tax cut. the president came out and said this is ridiculous that both sides -- and he positioned himself in the middle of two quabbling parties. and remember, the democrats are very angry particularly that the president hasn't gotten involved and picked up the fight here. we must note here that republicans have gotten from democrats -- democrats have now signed on to cuts in spending that are as large as the ones that house republican leaders initially proposed themselves. so there are a lot of democrats that say, wait a minute, the president was helping us make this case. we would have not had to accept so many large cuts.

gwen: the democrats think they got rolled in this. >> the white house says we didn't want to get involved in this tiny fight over a little tiny bit of the budget. we are thinking about since the state of the union, the large budget, the big thing about entitlements and investment and america's future and jobs. and we want to have the big conversation and have the president ready for that, so we didn't want to get involved in the little one. >> but we don't know when we're going to have that conversation. and one of the things that happened this week because of the proposals laid down by paul ryan -- gwen: the house budget commilt chairman. >> yes, who's providing much broader changes, is that he is forcing the president's hand, perhaps, to get back involved in a dramatic way and be very specific. don't forget, we're in chapter two of the obama presidency. the first chapter was when he was very much involved in health care reform and so he pulled back. and now he's going into i'm going to lead from the back stuff, whether it's overseas or at home on this. >> one of the things that the

republicans are pressing on not just in terms of timetable but in terms of the demand that we do something about the structural deficit long term is they're saying you better get back in the game. and it will be really interesting to see if he does. >> it's interesting how the white house reacted to paul ryan's recommended budget, because they were very careful in what they said. they didn't necessarily attack him in the way that congressional democrats did attack his budget document. and part of that, i think, as michael says, and john is saying, is that the president's got to go there, too. and if you look at ryan's broad budget, that cutting $6 trillion from the government over 10 years -- gwen: this continuing resolution fight seems so tiny. >> yes. and inside of that document is basically the republican version of health care reform and the republican version of tax reform, and the republican version --

gwen: entitlement reform. >> -- of entitlement reform and energy reform. it is one big document and there are going to be pieces of that, especially tax reform, that the president has said i'm rather interested in that. so we have to be careful not to attack the whole if he wants to pull pieces out. >> it is worth, just as a viewer's guide, remarking on what we're about to get into here. we are about to talk talk about the role of government in the lives of americans, what the purpose is, do we have a safety net? who is it for? taxes. how much should they be, and what's fair? what is the american role in the world? and, by the way, what does the federal government have to do with the economy? i mean, every single philosophical -- >> and what is the government's responsibility to the old and the poor and the handicapped? >> in a time of huge deficit. gwen: when you look at a week like this and you look at the way the president -- periodically we say this is obama's big test and then we run that trap. and here we are now, another one of those big tests. if we look at the way this week played out and we look at what

awaits him, how well did he score on the test? >> well, i don't think we know yet. i think depsh you know, david walker, who ran the j.a.o. said this week was like fighting over the bar bill on the titanic. the way the small board fight is connected to the big one is as follows -- the bond market, overseas investors. watch the united states, the people, its government, and they say these people can't fix their problems. and if they can't fix their problems, then i am exposed here in a very big way. and i think one of the things we saw this week that's important, and obama will have to respond to, is i think the timetable that the white house thought it had to deal with the long tirm structural problem, which they hope to be pushed into 2013 or 2014, maybe a second term, has really shrunk here and they're going to have to deal with this now, at least make a start, before the election. and that is not what they wanted. and to that extent i think this is not something the white house

hoped would be a results of this. but i think it is one outcome, even if they get a deal. >> i think the fact that if they succeed in walking away from this brink and the government doesn't shut down, i think that all of them will be better off than had it shut down. because if the government is shut down, then the public could have been looking to point a finger at somebody. gwen: right. >> and the early polls -- the polls we have now suggest that the landscape was shaping up a lot like 1995, where there's an nbc news poll that was done where 37% of the respondents were going to blame the republicans to congress, 20% were going to blame obama. gwen: either way there was going to be a lot of blame. >> there's going to be blame, that's right. so i think if they walk away from this, then they all will come out all right. but then they go into the biggest brawl and the debt --

lifting the debt is another big vote. gwen: the thing about the debt is white house officials were laughing about the possibility that this would even be a debate not long ago. now it looks like it's real. >> this is not a debate that the president can avoid because in his state of the union and in all of the speeches he's been giving. while this fight has been going on about the revolution, the president is talking about energy, all of the education. his argument is yes, i'm serious about the debt, but we need to make smart choices about the investment. he engaged in this debate, so he can't say i'm not going to do it now. gwen: it looks like they have a deal as we sit here tonight. john boehner and harry reid have come out and said they're going to vote on a deal tonight. you all can stay up and watch that somewhere else, because we've got to go. but thank you, everybody, for helping us understand what this week was about, as we wait and watch for all of it to finally get sorted out. keep up with breaking news around the clock online at the pbs "newshour," and if you want to look back at how "washington

week" covered this same story back in 1995, go to our website and click on "the vault" to hear about it and how it looked back then. you can finds us at pbs.org. we'll keep covering the news and then meet here again to make sense s of it all next week on "washington week." good night. >> the conversation continues online. see more from our panel about the week's top stories it's the webcast extra found only on "washington week" online at pbs.org. captioned by the national captioning institute --www.ncicap.org-- >> funding for "washington week" is provided by --

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