GOP Leader McConnell on debt ceiling, fiscal cliff deal

>> congress has vowed to use the upcoming votes to get more spending cuts to entitlement programs like medicare . some are threatening a government shutdown . in a moment, we'll talk to alan simpson and erskine bowles about where they see the fiscal cliff deal leaving the country. they say it falls short. but first, the man who brokered the deal with the white house on behalf of the republicans and no doubt will be a key figure in the battles ahead, the top republican in the senate , mitch mcconnell . he joins me now. leader mcconnell , happy new year. welcome back to "meet the press."

>> good morning, david.

>> let me talk about a preview of coming attractions and the fights ahead, including the debt ceiling that was so bitterly contested back in the summer of 2011 . here is something you said in august of 2011 that i wanted to show our viewers and have you respond to. you said then, i think some of our members may have thought the default on paying america 's bills issue was a hostage you might take a chance at shooting. most of us don't think that. what we did learn is this. it's a hostage that's worth ransoming. is that the strategy for the coming fight over the debt ceiling?

>> well, first, these last-minute deals are no way to run the government. i can tell you that. we know what the problem is. you're going to have al simpson and erskine bowles on. they have talked about this for a couple of years now. we have a spending problem. you know, we have a debt the size of our economy, which makes us look a lot like greece. this administration has driven spending as a percentage of our economy from 21% up to almost 25%. we've resolved the tax issue now. it's over. it's behind us. we were able to get permanent tax relief for 99% of american taxpayers. and for 500,000 small businesses. so that's behind us. what's left to be dealt with is the spending. and it's a shame that the president doesn't embrace the effort to reduce spending. none of us like using these situations like the sequester or the debt ceiling or the operation of government to try to engage the president to deal with this. but --

>> but you said that was a strategy, that's what you learned. i want to come back to the question. it's a hostage that's worth ransoming, the debt ceiling of the united states government . is that the strategy that you would ransom that here again to force the kind of spending cuts that you think are necessary?

>> it's a shame that we have to use whatever leverage we have in congress to get the president to deal with the biggest problem confronting our future. and that's our excessive spending.

>> but you're conceding that that may be the strategy this time?

>> well, what the strategy ought to be is we ought to be doing something about the problem.

>> well, i understand that. but there are additional problems as well that flow from that. as you know, after the debt ceiling was resolved in the summer of 2011 , america 's credit rating was downgraded. johningler was the republican governor of michigan and said the following. he said this is to bloomberg news. it's a terribly blunt, clumsy instrument to try to use. it's not a good weapon for anything except destroying our own credit rating . so i understand your views about spending, and we can continue on that. but just as a matter of how you try to force those spending cuts, you heard the president. he said he will not negotiate over increasing the debt ceiling. you're saying despite whatever the business community thinks, you may have to push it to the brink once again.

>> what we're seeing here is the problem, the biggest problem confronting the country, is our excessive spending. if we're not going to deal with it now, when are we going to deal with it? we have watched the government explode over the last four years. we've dealt with the revenue issue. now the question is, will the president lead? you know, why should we have to be bringing him to the table? why isn't he leading us in the direction of beginning to solve our long-term debt and deficit problem? it's perplexing to me. that the president of the united states , elected to lead the country, is so reluctant to engage on the most important issue regarding our future.

>> but you understand what the president told me last week and other democrats have said, the republicans had a chance to say yes to a number of things, in addition to the trillion dollars of spending cuts that were en80ed as part of the budget control act of last year. they could have had additional cuts in entitlement programs if you had agreed before you did it in this temporary measure. going back to the summer of 2011 , the president said to all of you republican leaders, if you didn't have such a hard time saying yes to me as president we could have solved some of these issues why. is he off base about that?

>> you can relitigate the past if you want to. where we are now is we have resolved the revenue issue, and the question is, what are we going to do about spending? i wish the president would lead us in this discussion, rather than putting himself in a position of having to be dragged kicking and screaming to the table to discuss the single biggest issue confronting our future. you know, until we adjust the entitlements so that they meet the demographics of our country, we can't ever solve this problem. the time to solve it is now. presidential leadership is desperately needed. we know he's good at campaigning. but when does he put the campaign aside and start governing and addressing the single biggest issue confronting america ?

>> you have said a couple of times so far that the revenue question is over. the president doesn't agree. he thinks that additional revenue needs to be looked at. maybe it's part of tax reform , closing loopholes, raising additional revenue if not through direct tax increases through other simpson - bowles also think you have to look more at deductions. is that your final answer, it's done, solved, you won't look at it again?

>> yeah, that's over. i think tax reform ought to be revenue equal as it was during the reagan years. we don't have this problem because we tax too little. we have it because we spend way, way too much. so we have settled the tax issue. the question now is can we address the single biggest threat to america 's future. and that's our excessive spending. i would like for the president to lead. it is a shame that we have to kind of drag him to the table to get him to discuss the single biggest issue confronting the future of our country.

>> again, i think that people would push back at the idea that you would have to lead him. the president proposed significant entitlement cuts. simpson and bowles said he did it, though they would have liked him to have gone further. you can't say he's been dragged kicking and screaming when he has proposed entitlement cuts is. that true?

>> no, he has not. he didn't even embrace simpson - bowles . ask them why he didn't embrace simpson - bowles . he hasn't embraced any specific thing in public to deal with significant entitlement changes. he has suggested he might be for change cpi, which would be an important step in the right direction. i would like to see him actually put that on the table in any kind of negotiation. he's mentioned it publicly. but has been unwilling to do it privately. until the president leads --

>> for you, though, on medicare , you're the leader of the republicans . what do you put on the table right now to solve this problem?

>> i have said repeatedly publicly and other members have that until you adjust the eligibility for entitlements, do things like raising the age for medicare for future beneficiaries. not for those currently receiving or those about to receive. have serious means testing for high income people. you know, warren buffett is always complaining about not paying enough taxes. what i'm complaining about is we're paying for his medicare . we ought not to be providing these kinds of benefits for millionaires and billionaires. we ought to make sure that the eligibility for entitlements meets the demographics of america . when social security was passed back in the '30s, i think the average american lived to be about 61. this year the average male, 79. the average female, 81. we need to adjust these programs for the future so that they'll still be there. the trustees of medicare and social security say that medicare is going to tank in 10 years. the question is, are we going to preserve these programs for future beneficiaries? the president should be leading, not being dragged to the table by republicans who want to solve the biggest problem confronting the future of our nation.

>> if you are not satisfied that you're dealing with the spending issue, the entitlement issue, the way you think it ought to be dealt with, would you rule out a government shutdown to achieve your goals?

>> what i think we ought to do is to encourage the president to actually be president, address the single biggest issue that --

>> i understand that. but my question is, would you rule out a government shutdown ?

>> i know what your question is. what i'm telling you is i haven't given up on the president stepping up to the plate and tackling our spending.

>> but other senators are saying they would consider a government shutdown . as the leader of the republicans , would you rule it out?

>> i'm telling you we elected the president to be president. it's time for him to step up to the plate and lead us in the direction of reducing our excessive spending.

>> as a senator, as a leader who's also facing re-election next year, or in -- yeah, next year now, i have to keep track of my dates. i want some of your reaction to some of the criticism from the right to this fiscal cliff deal, which as you know doesn't deal with spending, is a temporary measure, and taxes are going up. charles krautheimer said it's a complete surrender on everything. ericson blogger from red state wrote this. dear members of the press, yes, you can all refer to this as the mitch mcconnell tax hike. red state approves the tea party of louisville, the president saying this week, the next test will come with the debt ceiling debate. let's hope mcconnell compromises and giving in while getting nothing in return. however, if his fiscal cliff negotiations are any indication, we'll most likely see him wave the white flag again. what's your reaction, senator?

>> well, the election will take care of itself in 2014 . the question is, what will we do now? we know that everybody's taxes were going up a couple of days ago. what we did was prevent tax increases on 99% of the american public. nobody in the senate , not the 90% of senate republicans who voted for this, voted to raise anybody's taxes. and the arbiter of whether something is a tax increase or not is americans for tax reform . the head of americans for tax reform said it was not a tax increase. and had he been a senator, he would have voted for it. look, this was not a tax increase. it was not the kind of complete deal we'd like, because we want to cut spending. but we did save a lot of taxes. the tax issue is behind us. and now we move forward to see if we can get a reluctant president to do something about reducing our excessive spending.

>> what do you say about all the division within the republican party ? look at the difference between senate republicans , house republicans , the fact that speaker boehner doesn't seem to be in a position to negotiate with the white house any further. that seems to be falling all to you. how much damage does it do to your goals for the government that the republican party seems to be so divided over what you have just done on the fiscal cliff, and continues to be divided over the way forward on taxes and spending?

>> well, there are divisions among senate democrats as well. in fact, i don't think there's a bipartisan -- i think there's a bipartisan majority in the senate for not raising taxes further. in other words, taking the same view that i do, which is that the tax issue has been resolved. it's behind us. so there are divisions on both sides. i mean, we can spend a lot of time talking about that. but the requesty is, what are we going to do for the country in the meantime? the american people chose divided government . we have a democratic president, democratic senate , and a republican house. they expect us to figure out some way to make progress for the country. that's my view. i wouldn't have chosen this government. i voted for mitt romney . if mitt romney were elected, nobody's taxes would have gone up. but this is the government we have. and can we make some progress for the country over the next two years? i'm hopeful we can.

>> you said notably in the president's first term that your number one political goal was to make him a one-term president. he is now a two-term president. what's your number one political goal today?

>> well, as bob woodward pointed out, all of you left out the second part of that discussion, which is that was a long time off in the future and meantime we needed to do important things for the country. my goal is always to try to accomplish progress to achieve things for the american people . the single biggest issue we have right now is this massive, massive debt hanging over the heads of our children and grandchildren. we need to address it. and the american people elected divided government . they expect us to deal with the problems, even though they are hard to deal with, when you have different points of view. i would hope the president would step up to the plate here and say, we need to do something about this spending addiction , and i'm going to lead the way .

>> a couple of quick ones, leader. chuck hagel appears to be set to be nominated as defense secretary . will he be confirmed, do you believe?

>> well, i think he'll be subjected to the same kinds of oversight hearings that any nominee for such an important position would expect. and his views with regard to israel, for example, and iran and all of the other positions that he's taken over the years will be, you know, i think very much a matter of discussion during the confirmation process.

>> so you're not predicting smooth sailing for chuck hagel ?

>> i think it will be a lot of tough questions of senator hagel , but he'll be treated fairly by republicans in the senate .

>> as you know, i spend the holidays in kentucky, your home state, and i know full well there's a much different view of gun regulation in your state than in other parts of the country. never ttheles nevertheless, the president appears to be ready to push forward to a more comprehensive package dealing with mental health . have your views changed? are you willing to entertain the idea of new gun regulation ?

>> i think we need to see what the vice president's group comes up with, what their recommendations are. there will be plenty of time to take a look at the recommendations once they come forward. what's going to dominate washington for the next three months here is going to be spending and debt.

>> before i let you go, you talked about your re-election next year. there's talk that ashley judd , the actress, might indeed try to challenge you for your senate seat. i know you've said you're a fan of her movies. do you think she'd be a formidable opponent if it comes to that?

>> look, the election is going to occur in 2014 . in the meantime, i've got my hands full trying to deal with all of the issues that we've been discussing here this morning. we'll worry about the election in 2014 .

>> all right. leader mcconnell , thank you very much as always.

>> thank you.