>>shepard: the people will go along with closing loopholes in a vacuum because closing loopholes sounds right. wait, wait, wait, wait, i will do this, cheri, people are not going to like the closing of the loophole and it is the loophole they are using. if it is my mortgage interest i don't like it. if it is my income --. >>guest: it will hurt all sides. >>shepard: but no one will be for any of it, someone has to say i don't care if you are for it or not we are about to fall off the cliff the station in trouble and here is what we are doing but does anybody have the...wherewithal to stand up and tell us what we don't want to hear but what the truth is? we must make changes. i have not found that person yet. >>guest: it will happen and it will be incumbent on speaker boehner and he knows it will hurt people on the right but he is saying he will do it and we need the president to come to the table and he will do the same thing. i like what speaker boehner said. he knows it will hurt people open his side and he set parameters. >>shepard: you are right, you could be right. it is serious, is

close the loopholes, as you discussed.n place pro-growth policies and energy and healthcare and the regulatory policy. then address the spending. the spending that has to be addressed is medicare, medicaid and snore we'll get to spend -- >> chris: we'll get to spending in a second. boehner seemed to be saying i am going to close loopholes and use the revenue. not just growth, but use the re-knew from closing the loopholes to cut the deficit. are you accepting that or not? >> i think that is the formul formula. that is the way we reach agreement. you can close the loophole -- >> chris: it's not the growth. taking the money, tax expenditures through the loopholes and giving, using it as a deficit savings. >> as long as you close the loopholes and limit the deduction, limit credits. formula for a solution. >> real solution. >> chris: senator corker, you have a draft plan you have been circulating to a number of members in the senate. is there a deal here? >> i think there is a deal. the ying and yang of this is we know there

, closing loopholes.rogram that people who care about the poor and the middle class are worried about is the mortgage deduction -- mortgage interest deduction. is that on the chopping block do you believe? >> you know, you hear that. it surfaces periodically. i cannot imagine anyone would vote for that. that's really, in terms of middle income individuals that's probably their only major break that they have. that's the path to achieving the american dream is through homeownership and part of that has to do with the tax benefit of that because when we look at the equity in one's home as a result of the wall street scams people have lost tremendous equity in their homes and their accumulation of wealth has been just eroded. so what's left? but the mortgage interest tax -- so it does surface. you hear it bubbling up. but let's hope that the tea party republicans know that once again, that would be a tremendous hit on middle class individuals and those who are striving for the middle class. >> bill: well, i'

you open to closing loopholes and credits. you would be open to offer the democrats closing loopholes? >>guest: if we do not increase taxes on the membership. >>neil: sorry, sorry, sorry, i am trying to save the world here. the democrats come back and say what to you in order to get the yes on a deal, a temporary deal, to address the more serious issues, what do you want to hear from them? you have gone ahead and told them the credits, allowances, willing to junk them and you my democratic colleague do what? >>guest: look at entitlement reform. the two-thirds of the budget on auto pilot and the fact is medicare and cad caught -- medicaid spending that has to be on the table. >>neil: what if they say we will look at the reform but they offer in skin like you just have with the credits and allowances, what do you specifically want to hear from them in the next 53 days to shake hands and do the hard stuff next year? >>guest: they have to lay out a clear path saying we will deal with entitlements and we will put it on the table an

what loopholes do you want to close?there is whole host of them you can discuss in the context of tax reform? liz: give me three. >> hear is the irony. you and i have been talking three minutes. entire three minutes we're talking about one quarter of this equation. we haven't heard anything --. liz: because that is on the side you're asking revenues of. and i totally agree with you. we heard nothing about spending cuts. that has to happen going forward. i totally concede your point without question but from your side closing loopholes and revenue which is what the other side is demanding give me like three revenue, three loopholes you close. give me three examples. >> i will not give you three specific examples right now. liz: why? >> because i'm a deputy whip. i don't want to get strung out put something together that isn't sustainable from a house republican point of view. liz: can you tell me without telling me specifics are, don't tell me what they are, have you ever offered them specific loopholes. >> no. it is a ge

cutting out the exemptions and loopholes. >> grow this economy and engage in tax reform. >> simplify the code. >> ywhen you get divorced, thats what happens. ♪ >> welcome back after the thanksgiving holiday and all eyes are on the fast approaching fiscal cliff with republicans possibly maybe looking to make a deal. with the deadline now just 36 days away, some top republicans suggest they could, shock, horror, break with their sacred pledge to grover norquist. >> i'm not obligated on the pledge i made tennesseans aware is just elected that the only thing i'm honoring is the oath that i take when i serve when i'm sworn in this january. >> there's a lot that has been said about this pledge, and i will tell you when i go to the constituents that have elected -- re-elected me, it is not about that pledge. it really is about trying to solve problems. >> when you're $16 trillion in debt, the only pledge we should be making to each other is to avoid becoming greece, but i will violate the pledge, long story short, for the good of the country only if democrats will do entitlement reform. >>

one of the likely way to close loopholes you don't people which loophole you will close. you say you can deduct up to this amount. >> that's right. >> so my big fear is people will take the mortgage deduction but they will be no money left over for the charitable deduction. and charitable giving, to pbs will just plummet. i think that say real danger that people who care about private philanthropy in this country should be thinking about. >> woodruff: that is the point again we heard senator corker talk about, putting a cap on it. so we've got a few minutes left. so i want to show something to our viewers. on the day after the election the president went over to his campaign headquarters in chicago and he talked to the, some of them are paid, some volunteers. and i want to show people what he said and get comments from the two of you. here is what the president said on wednesday. >> i am absolutely confident that all of you are going to do just amazing things in your lives. and you know, the ripples of hope that come out when-- that going to be you, i was just looking aro

tax loopholes closed. no rate reduction on the other side. they just want to close them down. of course we're talking about oil and gas and coal. they want $150 billion in revenues. that's going to be on top of the 400 or 500 billion dollars. tax rates may not go up but they're not going down. i tell you, to me this has stalemate. the reason i like this segment very much is the fact is stock market people think this is going to be easy. mr. obama called a couple of ceos over the weekend. i'd say right now there is just as good a chance for a stalemate as there is for a solution. last word? >> i'm willing to bet we will get something patched over before the end of the year. worst case over you go over to january 1, 2, 3, no big crisis. we've been through this stuff before. >> thank you very much. coming up on kudlow, with israel and hamas on the verge of a ground war, a cease fire could be within reach. is either side really ready to back down? the country is on the verge of attacks that could throw us into

get rid of loopholes. request like loopholes. >> you want do make sure you get something for the other side. you are so tired of the election you will cave for anything. >> the best outcome is do something, build a bridge to 2013 and we don't go over the fiscal cliff of higher capital gains and dividends and have a debate of how to reform the tax system. i would blow the whole system up and start over and get the rates down to 18 percent or 19 percent. i like what steve forbes talked about in anybody 96 -- in 1996, a flat tax. there would be so much growth, you would not believe it. you want jobs, have a flat tax. >>neil: i am a hugger, not a hater. the president, today, meeting with labor leaders, the first round of fiscal cliff talks and my guest is one of them, and he heads up the national education association. good do have you. how did it go? >>guest: good meeting. we had an opportunity to talk about what we believe is important and as you mentioned this is the first of three meeting, and he went with

i am not for just closing loopholes, but i would close loopholes if you lower overall rates which would stimulate the economy. neil: quickly, how did you make it -- what did you make of mitt romney's remarks to bankers that what hurt him was all the freebie's the president was giving out to his base and that that made the difference. >> i think we, as republicans everyone to grill the party, have to somehow develop some empathy for those who have been on government assistance and know that they don't all want to stay there. for example, i think there are many good people who have had to take unemployment insurance from other two but would like to work i don't think everybody on government assistance is a bad person. we need to figure out how to convince them to, though, that their life would be better if they vote for policies that help them get a real job and in the middle class. neil: more inclusive more conservatives say it is selling out, not you, but that they can't be democrat like. what do you say that? with your overture on immigration, a way to win over latinos to have been, yo

loopholes and using it as a deficit saving. >> as long as you close the loopholes and limit the deductions the credits, you can lower the rates and broad then base. that is the formula for a solution. and it is a real solution. >> chris: so, senator corker, you have a draft plan you have been circulating to a number of members of the senate. there is a deal here. >> i think there is a deal. the ying and yang of this, there has to be revenue. i haven't met a wealthy republican or democrat in tennessee that is not willing to contribute more as long ashey know we solve the problem. so, the ying of revenue, we understand and i think there is a good, pro-growth way of putting that into place so you are getting revenues from people like me and other folks. that make above x dollars. but what you have tied to that is true entitlement reform -- >> less than a minute. senator conrad. i mean, is there the basis of a deal here? no, it is not raising the bush tax rates. but, it is tax reform, where you close the loop hoholes and will work? >> it would. bow simpson-bowles closed off preferences, and ex

frankly, i think loopholes are the -- so-called loopholes, deductions for home mortgage, at this pointg place to look for new revenue. the place is look is with different kinds of tax s. is this a do or die line for democrats? >> it's 39.6 under clinton. as i recall, we did pretty well. i think that's a fine number, but at any rate there's going to be some kind of give wrg on revenue. that's obvious. i think the democrats have a stronger hand as a result of the election, and the fact that by the way during the election it wasn't about big issues. one issue was big and that was raising taxes on wealthy people, and people knew that's what president obama wanted to do. they new mitt romney didn't want to do it and voted for president obama. he has the authority of the election behind him, and that gives him a good hand here. >> david let me ask you about grover norquist. the man who authored the pledge that so many reps signed and mike lee was the latest to say there's a lot of ways to skin a cat and back off the pledge. grover spoke to soledad on cnn. here was his comment. >> if you want

frankly, i think loopholes are the -- so-called loopholes, deductions for home mortgage, at this pointto look for new revenue. the place is look is with different kinds of tax sources. not by making it more difficult for people to work save and invest. >> wow, adding even more taxes. did you switch parties? i'm just teasing you. >> if your goal is to keep the top rate low, i think a top rate of 35 is already quite high. if your goal is to keep a top rate low. you have to look at other kinds of sources other than the income tax. >> james, i guess the question is here would the democrats even accept a deal that was additional sources or closing loopholes as opposed to this rate has to go up. is this a do or die line for democrats? >> it's 39.6 under clinton. as i recall, we did pretty well. but at any rate there's going to be some kind of give wrg on revenue. that's obvious. i think the democrats have a stronger hand as a result of the election, and the fact that by the way during the election it wasn't about big issues. one issue was big and that was raising taxes on wealthy people, and

that is just how things go. >> this whole issue came up because of a loophole, because someone found a leap hole. >> right. so i think to some extent the ethics commission has the ability to address leap hole lope holes. the only downside if we don't define "support" at all there will be the chance of zero gay and lesbian as of what "support means." >> if we had "support" i would define it as public action or statement or actions encouraging or urging -- i will concede that i'm hoping that my hypothetic is ridiculous and it would be interpreted in the way that we have all think it should be. >> you just built them their loophole. >> i was thinking that election makes it more restrictive. >> that was my reaction when you said that. >> the big problem we had last time, the committees kept saying we are not a campaign. we don't have a candidate. we can't be a campaign without a candidate. and the commission accepted that. but at the same time, they were raising money and spending money that had the effect of a campaign while not being regulated. >> could we solve it by having both in th

there are loopholes. host: what are loopholes?uest: for example, when people move assets overseas, that is very much a loophole. there is carried interest where investors pay capital gains tax instead of ordinary income tax. that is a loophole. press your guests, if i might say so, when they say local, tell us what you mean. in order to solve this problem, to avoid the fiscal cliff, we have to get away from some of the rhetoric and talk about the realities. host: laurie, a democrat in minnesota. go ahead. caller: hi. i totally agree with the last caller and with what you just said about loopholes. we can't -- out and tax deductions because we are middle income. -- count on tax reductions because we are middle income. this is about two fundamental differences in philosophies. the republican philosophy is that to grow the economy -- excuse me, i'm nervous -- to grow the economy, you have to coddle business, lower taxes and regulations. the democrats philosophy is that to grow the economy grow the middle class. you invest in people.

both the gop leaders have put on the table possibility for closing loopholes. they both described it that way. is that going to be acceptable? >> our model is the reagan model of reducing marginal rates across the board for all people and eliminating this. if he did right, you could have a lot of economic growth. president obama things you get $400 billion by raising taxes on the top 1% or 2%. he could get $48 billion by doing the buffett role. his solution is $400 billion. he is running up deficits up $6.70 trillion. the size of his solution compared to the problems are not even in the same ballpark. that is why he is in there. he jumped to that promise. he sounds like he was not going to but when he got specific he made it clear in a year from now the middle class might target this. so no whining, all you peasants out there. >> if sometime in the next few weeks there is an agreement here that closes loopholes but does not yet lower those rates, is that violation? >> republicans would not support it. it would violate the pledge that most republicans have made

no it's not raising the bush tax rate but it is tax reform we closed the loopholes. will that work?it could. i think the reality is bowl simpson which i was a part of lowered rates but raised more revenue. >> closing off preferences exclusions deductions and it equalized capital gains and dividends with other tax rates. if you really want to go to where many think the tax rate is unfair you have close to an effective rate of a top rate of 35 percent people who are much much wealthier seeing an effective rate of 13 or 14 percent. that is really unfair. how does that happen? it largely happens because there is a 20 percent differential between capital gains and income. 35 percent for ordinary income, 55 for gains. >> i know you have been chomping at the bit to get the spending in entitlement reform which has to be part of any deal. congressman van holland a year ago august when boehner and obama were involved in the debt talks the grand bargain the president put on the table raising the eligibility age for medicare and slowing the cost of living adjustment for securioci security. woul

lowering rates, broadening the base, ending loopholes and e deductions. where have we heard this before? >> if we eliminate some of the loopholes and e deductions at the high end, putting a limit on deductions and exemptions, particularly for people at the high end. >> broaden the base, simplify the code and create incentives for growth. >> they have the same talking points. this is th plan wasn't good enough to get mitt romney elected president but republicans are still selling it hard. at least this is what they have been selling in public. behind closed doors is a different story. john boehner doesn't have the leverage he used to have. on a conference call he told house republicans they had to avoid the nasty showdowns that mark so much of the last two years. senate republican leader mitch mcconnell was the number one obstructionist in the president's first term. now he tells "the wall street journal" he'll do whatever it takes to get a deal. i'd be willing to pay the ransom if e we thought we were going to get the hostage out. but the hostage is what?

would closing loopholes instead of raising rates for them sty y satisfy you? >> i think there are loopholes that should be closed and we should look at how we can make the process of deductions, the filing process easier, simpler, but when it comes to the top 2%, what i'm not going to do is to extend further a tax cut for folks who don't need it. >> raising tax rates is unacceptable and frankly, it couldn't even pass the house. >> well, it feels like a dÉjÀ vu all over again. somebody is going to have to blink or we go over the fiscal cliff. my next guest knows all about fiscal cliff uncertainty and its effect on the individual investor. walter bettinger is ceo of charles schwab. the market certainly feels pessimistic. we are looking at another 200-point decline today. the market is down 5% since the president was re-elected. what are you hearing from clients? >> clients are really concerned. there is pessimism among investors. there's great uncertainty. we have a lack of confidence. they're looking to washington for leadership to address meaningful issues. ri

he said over and over again close loopholes. which ones?t burden will that bring to bear on different people, and how do you make the numbers square? why hasn't he answered that question? >> well, your putting exactly the right question to speaker boehner as have i. i think we should say okay, you talked just the other day putting tax revenue on the table. let's see your plan. the president has been clear and direct about how he would achieve this deficit reduction plan and how he would get the revenue. he talked about it again today. you know, during the campaign mitt romney kept refusing to provide the details of their plan. now speaker boehner should come forward. the speaker said we should do this in a transparent way, open this all to the public. mr. speaker, let's see your revenue tax plan, because so far it's not clear to me exactly what he is proposing. i don't know if is simply saying what republicans have said in the past that some how if you reduce rates on high income earners you're going to get this magical growth that pays for

he said i'm okay with closing loopholes, but it has to be revenue neutral. but i think everyone knows that to get a deal done it can't be revenue neutral. are you open to a deal where you cut a lot of spending, and you raise some taxes and it is not revenue neutral? in fact you take in more tax revenue when you're done than when you started? are you open to that? >> what i'm open to is the idea of acknowledging the fact that we can bring in on average 18.5% of gdp through our revenue stream. that's what our tax system is capable of doing in the united states. that remains a constant. whether or top rate is at 35% as it is now, or at 70% as it was back in the early 1980s. that's a relative concept. what i want is for us to produce a steady stream of 18.5% rather than having these peeks and valleys. last year, we had a valley of about 14.5%. other years, closer to 20%. we want a steady, even, 18.5%. >> but to get from 14.5 to 18.5 is not revenue neutral. >> to get to there is not revenue neutral in the immediate sense, but what i'm saying is that if it produce

what closing loopholes satisfy your? >> i think there are loopholes that can be closed.ld look at how we can make a profit of deductions. the filing process easier and simpler. when it comes to the top 2 percent what i'm not going to do is to extend further a tax cut for folks who do not need which would cost close to a trillion dollars. it is difficult to see how you make up that trillion dollars. just by closing loopholes and deductions. the mass tends not to work. it is important to establish a basic principle that was debated extensively during the course of this campaign. this should not be a surprise to anybody. when it comes to how we reduce our deficit, i argued for a balanced responsible approach. part of that included making sure the wealthiest americans pay a little bit more. i think every voter understood that that was an important debate. the majority of voters agreed with me. more voters agreed with me on this issue than voted for me. we have a clear majority of the american people who recognize that we are going to be serious about that deduction. are we g

we need to limit loopholes for the wealthy. mr. simpson, if you say yes to simpson-bowles when it comes to revenue, so will i and so will most republicans. we can get revenue without destroying jobs and both need to. no republican will vote for increased tax rates. we will insist our democratic friends reform entitlements something we've never done ask that's where the big money is at. say yes to simpson-expwoalz we'll get this behind us. >> schieffer: senator, thank you so much. and now we're going to get the other side of this picture. and joining us now, one of the architects of the president's victory, his senior campaign adviser, david axelrod, who is out in chicago. mr. axelrod, thank you so much for joining us. let me just start, on friday, the president said he was open to compromise, but he said he would not accept any approach to deficit reduction, that does not ask the wealth tow pay more taxes. speaker boehner, the republican speaker of the house, has already said that's a nonstarter. aren't we right back where we were

>>neil: what about closing loopholes? ending credits? that sort of thing?>guest: closing loopholes is fine and good if we are lowering marginal rates. we knee to focus on growth. our economy the last four years has grown 1.5 percent a year. we need to get it to historical acknowledges of 3 percent or 4 percent or 5 percent. the way to do that is with fundamental tax reform and regulatory reform and were toking burdensome regulation, and if the president means what he said on the campaign trail, that he is interested in working across the aisle to do some of that, i will be happy to work with him. but if he reads this election as a mandate to double down on more and more spending and debt and taxes and regulation, then i will spend every moment in the senate working to help lead the effort to stop that because i think continuing down this pass is very harmful for the country. >>neil: thank you again, senator elect. more after this. . [ male announcer ] if you're eligible for medicare... now's a good time to think about your options. are you looking for a pla

>> devil's in the details, can close the loopholes, whatever.we reported today on the fox business network is that he's telling banking executive, and i know this because these are the banking sectors that i cover, doing this broadly. neil: no one better connected. >> thank you. that says something about me; right? neil: yes, it does. >> what white house aids tell the folks is that we're ready to compromise. neil: but wheret's >> let me finish. that president obama believes debt is a legacy issue, that this is a big legacy issue for him. now, he's where the devil of the details, he has not said, and the white house doesn't say. here's the other devil in the detail, who is he appointing as treasury secretary? if it's jack lou, the current chief of staff, that does not sort of sh a lot of compromise. he's a partisan liberal. they think jack is the leadin choice. what about bowles, he's gone out there, former north carolina senator, said he doesn't want it, but suppose he goes there saying i want you, you can get the compromise. them you know there

john mccain in 2001 called for closing the gun show loophole. john mccain in 2001 was pushing for a patient's bill of rights. in 2001 he was flirting with abandoning the republican party and running as an independent in 2004 or even switching to the democratic party. that was john mccain exacting his version on veef revenge fro beating him in 2000. this is a grouchy guy that came back to the senate to use that seat because of sour grapes. i'm just sick of it. >> for many of us, this is not a political issue, and for many of us this is not revenge. there are legitimate questions whether you believe it or not, and there is some evidence that things aren't quite on the up and up. we're getting to the bottom of it. straight ahead, the stock markets respond to the talks at the white house today. in the guest spot a top money manager who oversees billions tells us what he's watching for. gecko (clearing throat) thank you, mr. speaker, uh, members of congress. in celebration of over 75 years of our government employees insurance company, or geico...as