The Cycle | January 31, 2013
>>> in the next hour, the senate is expected to vote on and pass the house's debt ceiling deal. a bill that su spends the debt limit for four months and foregoes the threat of default but doesn't end the fiscal threat. sequestration looms large over the capitol. a provision in the bill being voted on today would whoeld house and senate salaries new york city budget , no pay. there's an incentive. joining us is virginia congressman robert scott and, congressman, let's start actually with what we have already looked at and then move forward from there. the fiscal cliff deal that passed which basically extended the bush tax cuts for those under $450,000, modified the state tax, moved the capital gains rate up to 20%, was that a good or bad deal for the american people ?
>> we don't know yet because what we did is half of the budget . the tax cut part of the budget . we didn't do how to pay for it part of the budget . the problem that we have gotten ourselves in to is people trying to do budgets as if the taxes and spending are unrelated. they keep talking about reducing the size of government with unspecified cuts or to spending problem, not a taxing problem. but when you try to pin people down on numbers, you find out that what they're talking about is spending too much money on social security , medicare , head start , transportation or even embassy security. if you look at the budget last couple of years, embassy security was being cut so when they talk about these cuts, without specifying them, you're not really doing a budget . we passed -- we passed a -- almost $4 trillion tax cut without an indication of how to be paid for. now we have the sequester kind of hanging over our heads and at some point you're at a point where you have to put numbers on the table. if you're not going to do the sequester, then it's anticipated you'd have to come up with a trillion 200 billion in actual cuts. and the fact of the matter is nobody would want to be associated with cuts of that magnitude so a lot of people are resigned to the idea that the sequester might actually going in to effect.
>> well, so, picking up that point, if the option is sequester or 1.2 trillion dr $1.2 trillion alternative, i think we know the alternative, a grand bargain that obama and boehner came close to striking a few times and basically half of it and a revenue component. it right now would be tax expenditures . the other half involves entitlement programs , medicare , social security and obama floated chain cpi before the new year and two summers ago to raise the medicare eligibility age. would you be more comfortable with that broad framework, half revenue, half entitlement reform or just go with the sequester? which would you prefer?
>> i would frankly prefer we did not pass $4 trillion in tax cuts . maybe 2.8 trillion in tax cuts and wouldn't have to cut anything --
>> right, right. but this is where we are right now. this is the choice to make, right?
>> this is the problem. we are doing a sequential budget . we tugt do it all at once. cut taxes, how do you pay for them? if you don't pay for them that way, you don't get the tax cuts and doing things sequentially and ending up as your question suggests cutting social security and medicare to preserve tax cuts . i don't think if people knew that's what was going to happen, i think most people wouldn't have wanted the tax cuts to begin with. most people don't remember them from ten years ago and to preserve tax cuts they don't remember getting, they wouldn't want to cut social security and medicare . and you talked about raising the age of the chain cpi, both significant cuts in the programs. it's probably as painless a way but i would not support cutting social security and medicare in order to preserve the tax cuts and what we have done in this kind of sequential budget that we are dealing with.
>> congressman, i want you to help me understand something. krystal referenced the no budget , no pay provision. they won't be paid with no budget by april 15th and sounds good and i'm sure the american people are like, wow, they're doing something but 27th amendment of thesays no, you can't do. no law varying the compensation of services of senators and representatives shall take effect. why would you tell the american people we won't get paid until we pass a budget when you can't do that?
>> there's provision in there to deal with that and that says you won't get paid until the end of the congressional session and so ultimately you would be paid and so that makes sense for a group that doesn't need a paycheck and so for the millionaires in congress it wouldn't make a difference. you just live off the dividends and the capital gains and get the salary income later. for people living on a paycheck, it is not such a good idea. so it has interesting implications for the makeup of congress if that's how you do things. hold your pay until the end of the session and then you got all of your pay at once as if you didn't need to pay your mortgage, didn't need to make a car payment or salary during the year. you can just wait for it at the end of the year. but i mean, it is not a serious attempt at dealing with the budget problems. we have serious budget problems. we have trillion dollar deficit. we know if we cut $4 trillion in deficit reduction in 4 years we can get what the commission said within fiscal sanity. you could have done that by letting the tax cuts expire. no sequester, no talk about cutting social security and medicare . you would have achieved your $4 trillion all at once so all of the discussion that you have suggested about cutting medicare and cutting social security is in order to preserve the tax cuts . i mean, when's the last time you heard somebody talk about a jobs bill?
>> i agree but it amounts to a couple hundred or thousand dollars. most people remember it. i want your thoughts about ken c cuccinelli. what are your thoughts on his ambitions for governor?
>> well, i happen to -- i happen to know his record in the state senate and he's a -- and i don't agree with most of his views. some, you know, he's been working on restoration of rights for felons with the governor.
>> not all bad.
>> but basically i think his -- i'm not familiar with his book. so i can't go in to detail on that but in terms of the budget , we have serious work to do. ought to do it with arithmetic. if we're going to cut taxes say how you pay for it before you vote to cut taxes. and that's what we haven't done.
>> all right. congressman, thank you so much for joining us.
>> thank you.
>>> and up next, as much as the debt kreeling is a bunch of make believe, allegedly there are a lot of actual conservatives on college