'Incredibly heated and intense': Inside Joe's debate with Paul Krugman

>> to the thriller in bloomberg. that doesn't work. last night in his debate with "new york times" columnist, joe raised some concerns about spending and long-term debt, particularly with an ageing population , reaching retirement age . take a look.

>> we should have used the '90s. we should have used the bush years to pay down debt so we would have come into the era of a baby boomers retiring with very little debt. we didn't do that, and that is not the choice right now.

>> what's changed since 1997 --

>> the world. the worst economic crisis in three generations.

>> what has not changed is the fact that baby boomers -- you predicted they'd be moving towards retirement. you said specifically, why worry about deficits, there's a huge army on the march. baby boomers are getting older. the enormous generation is going to be turning 65 in 2010 . their ranks will swell. the ageing population will create huge, foreseeable budget problems. you predicted that in '97.

>> everybody knew that was coming. that was a reason to pay down debt back then. now the urgent problem is the highest long-term unemployment since the 1930s , right? a deeply depressed economy.

>> but in this problem you predicted, it's still with us.

>> but the opportunity to pay down some debt in advance, we missed that. now we need to run budget deficits and the difficulty we're having is that 2 1/2 years ago, the conversation in washington totally turned away from creating jobs to deficit issues as if the deficit, which is a problem for 10 years, 15 years, 20 years out, as if that were the crucial issue we needed to deal with now, and it is not. so i've also learned a few things, you know, in the last 15 years. so using things i said in 1997 is not actually the best way to analyze my views now. but the main thing is --

>> this is what you said in 2050 2005 . medicare and medicare will greatly increase the deficit. that will make argentina look like a model of responsibility.

>> well, things have changed since then too.

>> since 2005 ?

>> got a little mad there. it got really intense. we're going to to show more.

>> didn't like me quoting him, actually. it's a real question right now, mark. this debate does matter because it's always been understood that this president -- i've been assured by david axelrod going back to 2008 . you've been assured that the president understands this entitlement crisis, understands it's a generational theft we're engaging in, that we're stealing money from our children, from our grandchildren. as i said last night and as bob rueben has said, you never know when the bond crisis is going to hit. you don't see it coming like a hurricane. it comes immediately like an earthquake. then are you ready for it or not? so i guess this debate matters so much right now because there is a question as to whether the president has changed his position on entitlement reform. do you still believe he thinks that we need to protect social security , medicare , medicaid by reforming it now?

>> i think he does, but i think he'd like to do it when the economy is better so these choices are less difficult to make. in the short term, he wants stimulus. he can't always say that, but that's what he wants. in the long term, he does want to put the programs on better footing. i think where he differs from you is the medium term and the question of do you really need to do things in the ten-year space, tinkering with entitlements, tinkering with defense spending , discretionary spending in a way that makes people feel better about the next ten years. not so much because the balance sheet requires it, but that the markets react to it.

>> we're talking, though, about medica medicare , medicaid.

>> but if he doesn't do that in his term, the programs are not going to be insolvent when he leaves office. he doesn't want to make a deal when the economy is bad because the deal has to be much more draconian with low growth rates.

>> but steve, every year that goes by is another year we add more debt. when barack obama came in off, we were at $11.5 trillion. now we're at $16.5 trillion. every year gone by is an opportunity lost.

>> if you look at a second-term presidency, typically there's 18, 19 months to get something done on the domestic front. then your administration becomes. the province of foreign policies , where you look to build your legacy. on all this fiscal issues, it looks like it will be the work of the next president because there's not going to be a deal done.

>> all right. joe also challenged krugman's ideas about government spending .

>> basically, any kind of spending cut right now is going to hurt the economy.

>> entitlements or not?

>> whether it's entitlements or not. even if it's wasteful defense spending it's going to hurt the economy if you cut it right now, which doesn't mean we shouldn't be looking for ways to cure waste. right now, spending is spending. if we -- so do the kind of entitlement reform i want and stop overpaying for medicare , stop paying for unnecessary treatments. that's clearly something we want to do in the long run. right now it's going to mean less income for hospitals. it's going to be a problem for the economy.

>> i don't think spending is spending. not all dollars -- not all investments are created equally.

>> then you just don't understand what it means to be a depressed economy. how did we end the great depression?

>> you just throw money at the problem?

>> all right.

>> and the answer was, yes. that was his answer.

>> we have much more of this ahead. it got incredibly heated and intense at times and went on for a full hour. it was exhausting to watch.

>> but in a good way.

>> in a good way. it was really enlightening.

>>> still ahead, former governor jeb bush will be onset.

>> boy, he made some news yesterday.

>> real big news.

>>> also, economist jeffrey sachs , retired supreme court justice sandra day o'connor. and "the washington post " eugene robinson . first, here's bill karins with a check on the forecast.

>> well, we have this winter storm bearing down on chicago . shortly it'll move into the ohio valley and the east coast tomorrow. let me show you the latest totals for your area. right now the snow is flying from minneapolis to rochester, cedar rapids , the quad cities . it's not yet in chicago . i think you got another two hours before the snow begins there. as far as the snow today, during the daylight hours, full-fledged snowstorm for chicago , northern indiana . eventually that light snow will go into areas of ohio and southern michigan . mostly a wintry mix near the ohio river . minneapolis, 6 to 10. chicago , 4 to 8. madison, about 4 to 8. a little less around indiana and iowa. indianapolis, you miss out on a lot of the heavy snow. it'll stay to your north. by wednesday, the storm comes off the east coast , especially wednesday afternoon. it looks like coastal areas on i- 95 will be rain during the morning and afternoon, including new york city , philadelphia, and washington, d.c. it'll go rain to snow late in the day on wednesday. it's going to be a heavy, wet snow. it's going to be windy. i am concerned about power outages, especially if we get more heavy, wet snow than i'm calling for here. this is kind of my first forecast. we're looking at about 3 to 6 for d.c. baltimore baltimore , 3 to 6. areas of southern new england t looks very messy and sloppy. if you're at higher elevations, you'll be getting more snow. bottom line, chicago , already 1,000 flights canceled for today. tomorrow, areas like reagan national and bwi in baltimore , you're going to have a lot of flight troubles tomorrow. make your plans accordingly. what a beautiful start to what will be a messy