. >> we had bowles-simpson. we heard timothy geithner just hesitate as he said we would get back to bowles-simpson. are you optimistic we could revisit the work of bowles-simpson after the election? >> i remember saying one of the sunday morning shows, probably "meet the press" the day after bowles-simpson came out. i said something of this nature. i was asked whether or not i thought it would pass the house and the senate. and i said the answer is yes it's only a question all it occurs before or after a bond market crisis. i still hold to that view. i think the worst mistake that the president made was not embracing that particular vehicle right away because there were very few initiatives which have the wonderful capability of getting republicans and democrats on board the exact legislative language interpreted differently. i mean, what's in the bowles-simpson initiative is a trillion dollars in tax expenditures. tax expenditures to republicans are subsidies. eliminating them is an excellent political maneuver

let's get to work and get bowles simpson put in place. >> senator johnson, it's not as simple as simpson-bowlesbut is this government now too big to succeed? >> it's certainly too big to manage, that's for sure. i want to go back to last summer because i have no idea hough close we might have come. i was totally opposed to negotiations because the american people simply don't know what was proposed, what was rejected. we should be really following basically regular order. again, the house has done that, the senate should do that here. the democrats and the senate should put forward a plan they can actually vote for. since i've been here, a senate democrat has yet to even vote for one budget proposal. none. they need to do that first so the american people can see what their plan is for preventing the fiscal cliff. >> senator, you'll agree at some point we've got to cut spending, wouldn't you? >> let me say, ron, we'd agree to call each other by senator but, ron, he and i have a common goal, which is to get our country on a physically sustainable path. strict spending cuts provides a way forward

>> well, there's one more example of how the president disagrees with bowles/simpson. bowles/simpson says reduce tax rates across the board by closing special interest loopholes. the reason people like me didn't support bowles/simpson it ignored health care, the drive of our debt. we put up alternatives. the president hasn't offered a single solution to fix this debt crisis, to deal with this tax explosion that happens at the end of the year. more importantly he's disavowed any other alternative. that's how you get to compromiscompromis compromise, david. you pass what you believe. the senate passes what they believe. you compromise. that isn't happening because the president and his party leaders in the senate are refusing to do anything to address this debt crisis. what's going to happen at the end of the year i think will largely be determined by who wins this election. this election is going to be a great choice of two -- the president's approach or the idea offered by governor romney. the country will choose. i think that will decide what ends up happening in lame

i was positive there was, simpson-bowles would have been ? if there was such an elite consensus, simpson bowles would have been more -- i think the american people are way out ahead of their leaders on this. the leaders need to follow the hfr- >> what's your evidence for that? >> anecdotally when i go around to talk to people, when i go to campaign events, when i talk to people people in cafes or starbucks, people are worried. >> and you hear them saying i'm so worried, should you cut my benefits? i'm so worried i want to pay more taxes? >> i don't think they know the difference between simpson simpson-bowles and a the gang of six. they understand numbers. they understand the correction that the deficit is going and the peril that the country is in. i think they understand that and they understand that members of congress are not making sacrifices in their own -- with their own constituencies in order to getting across the finish line. it's the first time i think a lot of voters and taxation have seen it equated to mortality. i think they see

author of the simpson-bowles plan. nator simpson, i want to ask both of you, but i want to ask you what you think of president obama's embrace of your plan or lack thereof, and i'm going to start by asking you -- just bare with me because i talked to him in january. mostly will foreign policy, but i did ask him about simpson-bowles, and he probably got -- this got him more agitated than at any point in our conversation. this is what he said. he said, "i've got to tell you, most of the people who say if you ask them what's in simpson-bowles, they couldn't tell you. first of all, i did embrace simpson-bowles. i'm the one who created the commission. if i hadn't pushed it, it wouldn't have happened because the congressional sponsors, including a whole bunch of republicans walked away. the basic premise of simpson-bowles was we have to take a balanced approach in which we have spending cuts and we revenue increases, and although i did not agree with every particular thing that was in it, what i did do is take the framework a

that's exactly what bowles-simpson was designed to be. so i agree, it is a little out of character.i think that was basically a reflection of the fact that by 2011 they were feeling a lot of pressure. and they were beginning to be concerned about that pressure, and the pressure build particularly with medicare, social security. and their anxiety, which i think was the correct anxiety was, if you embrace bowles-simpson, and they said this, too, and i happen to agree, if you embrace bowles-simpson, which is where you want to end up, it immediately becomes not where you will end up but it becomes your opening pit. and you end up several hits to the right of it. if you recall paul ryan, who gave the republican opening, was often -- off in crazy land, trillions of dollars in tax cuts and cutting discretionary spending at to start an immediate post-world war ii level. so they figured, like, you have this guy, paul ryan to his way out there, and if we embrace bowles-simpson which is one want to end up, we'll end up somewhere in the middle and that's going to be a communal, a bad place to b

what we must do as congressman paul ryan knows and on the bowl's simpson commission. we must cut the deficit four trillion >> chris: wait, wait, wait, mr. goolsbee, that commission appointed by the president did take serious steps in terms of entitlement reform and president obama refused to endorse it? >> guest: not correct. >> chris: wait, wait, wait, are you saying president obama approved the bowl's simpson. >> guest: the central idea was a balanced plan three dollars in cuts for one dollar in new revenue. reason that congressman ryan voted against the bowles-simpson plan and mitt romney stood up and said would you accept a deal that had 10 dollars of spending cuts for one dollar of new revenue. mitt romney said absolutely not. because they had any new revenue they would not support it. the president's budget before the congressional budget's office and not i might add the thing they voted on in the senate. the president's budget cut four trillion in a balanced way. >> chris: all right. let me, let me. forgive me, sir. let me bring in congressman ryan. >> guest: c

the simpson bowls commission -- the simpson bowls commission said this nation has never faced a more predictable financial crisis, the same thing as the council of economic advisors said. chairman bernanke, chairman of the federal reserve, always kaw enthuse what he says, quote, "the c.b.o. prejections" -- and he is talking about the congressional budget office projections of surging debt year after year -- he says this. "the c.b.o. projections by design ignore the adverse effects that such high debt and deficits would likely have on our economy. but if government debt and deficits were actually to grow at the pace envisioned by this scenario, the economic and financial effects would be severe." and i recall at one point he said in his testimony, you see these debts being projected out there year after year, surge at this high level? he said, you are never going to get there. what he meant washings we'd have a -- what he went was we'd have a financial crisis before that happens. and so i would say to my colleagues, this is a time of challenge for the senate, the congress of the unite

what i would look to see them do is do what simpson-bowles did. they say pass our plan but trigger it when there is clearly growth because you won't have to convince anybody to do it then. as soon as there's real growth in this economy with all this public debt that has to be financed, interest rates will go through the roof, the cost of financing the deficit will be staggering and the private sector will be screaming for affordable credit. so -- but if we did it now people would see that we're a serious country and the american people would feel reassured about it and the europeans might have a way out of the box they have gotten themselves in. you see with both the eu and all these recent elections and u.k., if you impose astairity when interest rates are zero then what will happen -- i was really impressed actually after these last elections that other greek citizens would say things like we know we have to cut these pension benefits fwheerk everybody's got to start paying taxes, but we'd like to see the benefits of it. so that's what i think.

a version of simpson bowles made it to the house floor 38 votes in all. what encouragement should the audience take away from that? >> as those of us who have really devilled into simpson bowles know, and as i mention in a usa today editorial in response to that, there is a huge difference between what was proposed on the house and simpson bowles. it goes to this argument we're having on baseline issues which is an arcane but very important debate. because the proposal on the floor of the house was about $1 trillion in revenue short of what simpson bowles proposed. they essentially ignored that trillion dollars of revenue. which totally challenges the balance of cuts to revenues. i support the framework. i support the ratio and the accounting methodology of simpson bowls. yobt messily agree with every recommendation. if we disagree with a particular recommendation on revenue or cuts we have an obligation to come up with an alternative. i support the framework there be and the proposal on the house just was $1 trillion in revenue below simpson bowles. that'

we haven't talked about bowles and simpson call the tax loopho loopholes, the 1.1 trillion we spend every year. if we were to get rid of the tax loopholes in the book, we would not only do probably as much as bowles-simpson did, but we would deal with a lot of the in-balance that we have in our tax code. a lot of those tax breaks people have become accustomed to, so we have to figure out a way that we don't disorient the american family, but you can do a number of things without having to do violence to the american family and it ability to do what my parents did to me, let me become the first to become a college agree. >> many republicans have the view that the lack of spending discipline which we've seen in recent years had its origins in the bush administration in which he served, that there just was insufficient concern to the long term costs of things the med cared prescription drug benefit and the rest. >> that's accurate and if you look back at the time period 2001 off after 9/11, particularly there was a sense in this town that more meeted to be spent on homeland security and defe

bowl simpsons is a great outline. i think domenici-rivlin was terrific.e end of the day what's got to happen we've got to come together and deal with our long-term debt threat and i believe we've got it a chance to do that, either in a lame duck or the first part of next year, but we've got to do the homework now. >> and you're still -- are you getting any traction on this from the white house? >> you know, i can't speak for them. but i can tell you that the president was very prepared to do the grand bargain last year and i think he is absolutely prepared to do it. but you know, you've dot have both sides willing to come together. and our republican friends are going to have to cross the rubicon and be willing to have more revenue because if you look at current circumstance revenue right now is at or near a 60-year low as a share of our national income. spending is at or near 60-year high. we've got to deal with both sides of the equation. most of the republicans friends, most, not all, say, no, you only deal on the spending side of the equation. thats n

yes. >> i've read every word of the simpson-bowles report. i think you could put together sufficient democratic votes to enact a simple variation of simpson-bowles or even to do more. >> yes, virginia, there is a santa claus solution to the debt crisis, it's call simpson-bowles. it would cut taxes to three brackets, 12%, 22%, 28%. tax cuts for all. there are places where we'll all pay more. and there will be cuts to mortgage rate reductions. but it's better than that cliff. sometimes i wonder if the democracy our country is so proud of, the democracy that happens here in this building, where i'm standing tonight, isn't actually what's putting the wind behind the lemmings tales. is democracy going to be what sends us over the cliff? >> we're in our 223rd year of our experiment in democracy in representative government. it's not worked well if you go back to the days of the greeks or romans. there's some point at which they had problems. >> the view from america's cliff look like a little thrill. if we fail, all the opportunities, liberties and

with simpson-bowles. i support the framework of simpson-bowles but i support the ratios and the accounting methodology of simpson-bowles but i don't necessarily agree with every recommendation they make but i think for those of us if we disagree with a particular recommendation, whether it's on revenue or cuts, we have an obligation to come up with an alternative. so i support the framework there, and the proposal on the house just was $1 trillion in revenue, below simpson-bowles. that's a pretty big difference. >> all right. listen, thank you all for participating in this panel. great discussion. jodi, thank you very much. will have to move on to our next bill. again, thank you very much. [applause] >> we will move from one tricky subject, the fiscal situation here in america, to another tricky subject, the housing situation here in america. my colleague, nela richardson will moderate the next benefit if they want want to make away up to the station i would a quick introduction. shaun donovan, the secreta

madam president, i was part of the so-call ed bowles-simpson commission. supported the conclusions that called for that kind of an approach. additional revenue but also additional spending cuts. and madam president, that's what the american people says we ought to do. but that is not what our friends on the other side are proposing here. they propose additional tax cuts. dig a hole deeper before you start filling it in. and then they say, well, in addition to that, we will have really draconian spending cuts because you are going to have more tax cuts that primarily go to the wealthiest among us and you are trying to reduce the deficit. that means you are going to have even more spending cuts. just say that our republican friends the budgets they are offering here today have something in common. everyone of them ends medicare as we know it. every republican budget offered today ends medicare as we know it. madam president, on social security one of the republican budgets being offered here today cuts social security 39%. that's their answer? if you are gee

he is the simpson of simpson bowles.of the most passionate and entertaining speakers today. >> how many contractors do you have in the defense department? well, it's quite a range. what is it? it's between a million and 10 million. that is a hell of a range. obama care, call it elvis presley carry. where do you get your health care? is it free? there'll be hair and blood and eyeballs all over the floor. how the hell do you get that? anyway. >> even the guy used to be the guy youngest in the room but not anymore showed up. president bill clinton was there. he's 65 years old which is young, but he's spending a lot of time working towards bipartisan solutions. so, look. here's the bottom line. shows americans do care. and older people do care allot. tom brokaw was there, my mentor. they care. they care. anderson cooper starts now. -- captions by vitac -- www.vitac.com >>> thanks. good evening, everyone b. we're keeping them honest tonight of whether president obama is trying to have it both ways. attacking leaders of compan

he is the simpson of simpson bowles.of the most passionate and entertaining speakers today. >> how many contractors do you have in the defense department? well, it's quite a range. what is it? it's between a million and 10 million. that is a hell of a range. obama care, call it elvis presley carry. where do you get your health care? is it free? there'll be hair and blood and eyeballs all over the flo

my three appointees to the bowles-simpson commission voted for it. one of my appointees will to the joint select committee later in the year offered our friends on the other side new revenue. that's not something that we lightly offer. we got nothing in return. about the long-term debt problem facing this country, and we all know that it's on the entitlement side. so at some point here, this president needs to become the adult because the speaker and i have been the adults in the room arguing that we ought to do something about the nation's most serious long-term problem. >> schieffer: well, talk to me about the timing here. are you talking about you'd like to do this, having this argument over whether or not to raise the debt limit before the election or are you willing to let that go until after the election? >> well, the timing will be determined by the president. they determine when to request of us that we raise the debt ceiling. we assume that will happen at the end of the year, early next year. >> schieffer: so, so you're not going to do anyth

and then there was a vote against a simpson/bowles-like budget by the congress. understand that there isn't agreement on simpson/bowles. in fact, there's not a lot of damage about simpson/bowles and then the other thing i would say, we were talking about big government. another way to measure size of government is revenues as a share of gdp. they are near 15%. they were below 15%. they are at an historic low for the post world war ii. people need to talk about, are they willing to pay for the social security medicare student loans, et cetera, that they want. >> i think people get it recognize that we can't afford the programs that we have right now but people don't come out and say, hey, we can't afford this. this is what we need to do even though it's not going to impact people 55 and old ohher today but future generations are not going to have it there. how do you get the buy in, kevin, from the people, to make the hard choices that need to be made? >> well, i think it takes leadership and it takes a much different path than the one we are on. if you go back and

i favor with simpson-bowles said. i've likened to take even more out of the deficit was simpson- bowles. -- i would like them to take even more out of the deficit. interest rates will go through the roof. the costs of financing the deficit will be staggering. the private sector will be screaming for a political credit. it thing we did it now, people would see that we are a serious country. the american people would still feel reassured about it. the europeans might have gotten themselves out of the box up the find themselves in. you e this both in the you and the recent elections -- in europe and the recent elections. revenues will drop more than you can cut spending. i was really impressed after the last election. all the political leaders themselves cindy jensen, ordinary citizens would say that we know you need to cut these benefits. we know we have to do these things. but would like to see the benefit of this. we should pass a plan asoon as possible, but you would simpson- bowles said. trigger an uncertain growth p

commission they wanted to have the they want you want to have a commission to solve our debt crisis bowles simpson comes out with a plan and nobody really ever talked about it over the goal simpson didn't clear the three trillion dollar tax cut for wealthy people like paul ryan's plan which i told you that it's all a gimmick to redistribute wealth from the very bottom to the very very top you're right it was completely different i'm right it's not so much it's different in paul ryan's plan absolutely but it's not so different i mean the fact was it aggressively pursued cuts in a way that president obama could never sign on to unless he was going to disinfect his liberal base is. the full sense of kind of bipartisan plan is something that the republicans though have refused to look at paul ryan even said on sunday on meet the press that he won't even negotiate with himself let alone negotiate with the other democrats in the house and in the senate on coming up with a compromise so that it everyone can benefit through up through this budget republicans have taken a hard line against tax increases th

and we did that in the bowls-simpson. probably not as well as i would have liked, but we did it to try to get the process moving. your guest earlier said it was a mistake that the president didn't embrace it. i agree. it showed a lack of leadership. but what you have to do is you have to reform the tax code. and with that, i remember in the reagan -- which you were a part of, the reagan tax changes, my taxes the first couple of years went up, but they ultimately went down as incomes rose. so if you reform the tax code, not by raising tax rates but by lowering tax rates and broadening the base, and if you save medicare by reforming it and you save social security by reforming it, and if, in fact, you markedly decrease the wasteful discretionary spending that we have and the duplication, we can strike a balance. >> you got $300 billion. we just talked about it on the radio, i think it was last weekend. wouldn't that be fodder for compromise? >> well, there's $300 billion, one. but you also could get another $300 billion put

that is exactly what bowles-simpson was and was designed to be. i agree.it is a little bit out of character. that was basically a reflection of the fact that by 2011, they were feeling a lot of pressure on the left. they were beginning to be concerned about that pressure. the pressure dell particularly with medicare, social security, and their anxiety, which i think was the correct anxiety, was if you embrace bowles-simpson, which is where you want to end up, it immediately becomes not where you will end up, but it comes your opening bid. you'll end up several feet to the right of that. paul ryan, who gave the republican opening bid, he was often talking about things of dollars of tax cuts and cutting discretionary spending down to post-world war ii levels. you have this guy, paul ryan, who is way under, and if we embrace full simpson, which is where we end up, we will end up somewhere in the middle. first, that will be a bad place because we don't feel like we should go anywhere further to the right for bowles-simpson, and second, we will get killed polit

i wonder if you can hone in on during this debate as we look back at bowles-simpson that we might have got something done, the debate goes to you. grover norquist would say that's bad because it will close loopholes. >> the taxpayer protection pledge was designed in 1996. president reagan set up americans for tax reform, the group i run, and asked me to run it to be the outside group to push tax reform. that was 1986. reduce tax rates. broaden case. it eliminated many deductions and credit that cluttered the tax code. it gave us good economic growth. very helpful. the americans for tax reform and american people are all in favor of getting rid of deductions and credits but not if it's a trojan horse for higher taxes. so let's reduce deductions and credits and reduce marginal tax rates. congressman from kansas has a great bill that eliminates tax credits targeted toward energy, natural gas, oil, tealgae and everything. lower taxes and no special deductions. >> you'll have to get into it with grover on your own time because we're out of time. still ahead on "starting point," harsh punish

peoplet of all, you ask to actually read what simpson- bowles did on social security. i have read every word of simpson-bowles. you should read it if you have not. on corporate tax reform, i agree with what they did. they would raise slightly more money by flattening rates. the bank want to do that i disagree with is get rid of the r&d tax cut. we are already 17th in the world and we are trying to get manufacturing back to america. manufacturers increasingly like to have already done where they do manufacturing. otherwise, those two things are good. on the medicare entitlements, you have two problems. one is demographics. if the baby boomers consume health care at the same percentage of gdp our kids did -- i mean, our parents did, we are sticking it to our kids. about $200 billion of the $1 trillion difference in what we pay under our system that we would pay if we had any other advanced country's system is because of diabetes and other lifestyle-related things that older people and children do. we have to deal with that. i think you can -- the democrats could be induce

if everybody looks at bowls simpson, everybody agrees four and a half trillion .. is just enough to send a signal to finish time doing it so if we got four and a half trillion dollars by bowls simpson in the next four and a half years we will need another four and a half trillion if we want to get out of the hole so we take a trillion-dollar out of the pentagon and people say, oh and i am a hawk, i am a defense hawk, but everywhere i have been, every military man i have talked to or woman, say, if you had to, tomorrow, could you get ten to fifteen percent out of your budget? there isn't one that hasn't told me yes. >> rose: would leon panetta tell you that? >> well,. >> rose: ten to fifteen percent? >> privately he might, the point is, they don't know, you realize we don't even have financial statement of the pentagon? they can't even get an audited financial statement? they don't even know how many programs they have got. they don't know where they are. they don't know whether they paid the bill or not paid the bill. >> rose: you take 20 percent out out of the pen