Rep. Defazio: There is no fiscal 'cliff'

>> congressman peter defazio , a democrat from oregon. good morning.

>> good morning.

>> you're one of the folks who have said, correct me if i'm wrong, that republicans won't accept tax hikes for wealthy and we might as well go off the fiscal cliff and take it up after january 1st . is that an accurate representation of your position? and if so, why?

>> sure. well, first, off the cliff is an unbelievable exaggeration. there's no cliff. in fact, the only tax rate that changes on january 1st is we do away with the social security /fica holiday. the other tax rates we would have ample time to deal with, and we would be then bargaining from a position of strength. the republicans would be free from their pledge to grover norquist about not raising taxes . and we would be talking about who is going to get some tax relief -- middle-class families, you know, people with children, and other targeted cuts, and the republicans could say, gee, i wanted to give the rich a tax break but we just couldn't get there. but, hey, we helped ow 98% of the people in america. i think we'd be barg frng strength. i'm very worried that we're getting back to where we were two years ago where the president was put in a box or a year ago when the president got put in a box over the republicans threatening to defall on our debt. we need to bargain from a stronger position and going over this bump in the road would give us that.

>> as you know, there are a lot of people who would disagree with you about that, not just about the financial numbers per se , say the $200 billion the president is talking act next year, but also from a psychological standpoint. we've already seen wall street reacting in a negative way, concerned exactly about what would happen if a deal doesn't get made and their growing sense that it might not happen. consumer confidence has been up. americans concerned that their taxes are going to go up. you don't think that those are legitimate concerns?

>> i think we can assure people that we would fix it early in january. wall street --

>> why should they believe that, congressman, with all due respect when what they were hearing before the election was it was going to get done by the end of the year?

>> i don't know where they heard that from or they heard it from credibly. look, the republicans want to be reasonable, great. but we're still dealing with the existing congress. it's a lame duck. and you've got a lot of the most radical tea party members who lost their elections. they're still here. they're still pushing the republican conference. next year it will be better. we can do this very quickly in january. we can assure people that. wall street , they are going to get hysterical because they want to drive tax cuts for the wealthy. they want to keep the special tax breaks for hedge fund managers and all the other goodies they're getting. so, yeah, they'll manipulate the market and try and frighten congress into doing a bad deal. no deal, and going over the bump in the road and fixing it in january is better than a bad deal.

>> let me ask you about one particular issue that has come um among the many that is of great concern to millions of americans, and that's the mortgage deduction. former treasury secretary larry summers said this morning it should be part of negotiations. let me play that for you.

>> i think it should be being phased out. and the advantage of a phaseout is frankly housing is coming back but it can use a bunch of help. and if we phase it out, then people have an incentive to buy their houses sooner rather than later and so you can give the economy an extra lift.

>> that makes the housing industry very nervous and some american, too. but do you agree with what larry summers said?

>> absolutely not. i don't think i've ever agreed with larry summers on anything. he was a disaster as an adviser to obama. that's crazy. the one tax break most middle-income families in this country can get unlike everything that's available to the wealthy and the spk lay or thes and everybody else is their mortgage interest deduction . i'm going to fight to keep that.

>> congressman peter defazio , thank you very much. great to have you on the program.

>> thank you.