CNN "State of the Union with Candy Crowley" - Transcript

Interview

CROWLEY: Though they don't like to hear it out loud, most Democrats admit that politics are tough for them this year, but as much as the terrain favors Republicans, it's no picnic out there for them either.

A recent "Washington Post/ABC News" poll asked how much confidence do you have in Obama, Democrats or Republicans to make the right decision for the country's future? President Obama still generates confidence. Republicans came in last, with just 26 percent saying they have a great deal or a good deal of confidence in Republicans.

Here with me now to discuss politics, jobless benefits and the Republican's groove is Senator Mitch McConnell. Thank you so much for being here.

MCCONNELL: Glad to be here, Candy.

CROWLEY: I want to play a little bit more about what the president had to say yesterday when he really was slamming Republicans for standing in the way of this extension of unemployment benefits. Take a listen.

(BEGIN VIDEO CLIP)

OBAMA: They say we shouldn't provide unemployment insurance because it costs money, so after years of championing policies that turned a record surplus into a massive deficit, including a tax cut for the wealthiest Americans, they finally decided to make their stand on the backs of the unemployed.

(END VIDEO CLIP)

CROWLEY: Look, we're talking about $34 billion to extend unemployment to the long term unemployed, to give them more weeks of unemployment benefits. Doesn't he have a point? I mean, why in the world would you choose to take this down? I mean, the deficit's a trillion dollars this year, so for $34 billion that's going to help people with no jobs, you all are standing in the way of it.

MCCONNELL: Well, the budget is over a trillion dollars, too, and somewhere in the course of spending a trillion dollars, we ought to be able to find enough to pay for a program for the unemployed. We're -- we're all for extending unemployment insurance. The question is when are we going to get serious, Candy, about the debt?

We recently passed a $13 trillion cumulative deficit threshold. When are we going to get serious about this? This administration has been on an incredible spending spree.

CROWLEY: I get that point and I understand what you're saying and I think the American people are concerned about the deficit spending. But you all -- when Republicans were in charge six of the eight years that President Bush was here, you were Majority Leader at times during that, you spent on a prescription drug bill that was not paid for that is far more expensive than this unemployment bill is. You had two wars, ongoing wars that were not paid for.

So for you now to stand up and say, well, we're for balancing the budget, and, by the way, you've got to pay for these unemployment benefits, it just seems dissonant to the trials of the American people, particularly those without jobs.

MCCONNELL: Well, let's put it in perspective. The last year of the Bush administration, the deficit as a percentage of gross domestic product was 3.2 percent, well within the range of what most economists think is manageable. A year and a half later, it's almost 10 percent. You know, how many --

CROWLEY: But you can object then --

MCCONNELL: -- how long can we -- how long can the other side run against the previous administration? They've been in charge now for a year and a half. They've been on a gargantuan spending spree. They've taken, as I said, the deficit as a percentage of GDP from 3.2 percent to almost 10 percent in a year and a half.

Look, at what point do we pivot and start being concerned about our children and our grandchildren? There is no way in the world on a trillion dollar budget this year we can't find the money to pay for an extension of unemployment insurance, something we're in favor of.

CROWLEY: But part of that $13 trillion came during a Republican administration for eight years, and I guess the question is that you now are asking the public to bring back a Republican Senate or a Republican House. How can they trust you if three years ago you all were deficit spending, and now you go, well, we're for -- we want to stop. We want to have -- pay as you go?

MCCONNELL: Well, the issue is not whether the public thought Republicans spent more than they should have. The issue is when do we stop doing this?

CROWLEY: Did you spend more than you should have as Republicans?

MCCONNELL: Look, if you put it in comparison, as I just pointed out, we've been on a gargantuan spending spree for the last year and a half, far more than any deficits that were run up in the early part of the decade. This is -- this is a serious matter. At what point do we pivot and do something about this? And we think if you can't pay for a program that everybody agrees we ought to extend, what are we going to pay for?

If we can't pay for a program like extension of unemployment insurance that virtually every member of the Senate -- I think, in fact, every member of the Senate wants to extend, then what are we going to pay for? When do we start?

CROWLEY: Let me ask you, along the same lines. I want you to listen to something that Alan Greenspan, former head of the Fed, had to say earlier this week.

(BEGIN VIDEO CLIP)

ALAN GREENSPAN, FORMER CHAIRMAN OF THE FEDERAL RESERVE: They should follow the law and let them lapse.

(UNKNOWN): Meaning, what happens?

GREENSPAN: Taxes go up. The problem is unless we start to come to grips with this long-term outlook, we're going to have major problems.

(END VIDEO CLIP) CROWLEY: It's Alan Greenspan, talking about allowing the Bush tax cuts to expire in January. Now, this is a man that supported the Bush tax cuts.

MCCONNELL: Right.

CROWLEY: What do you think?

MCCONNELL: Well, the issue is whether we're going to raise taxes. This is current tax law, and what they're saying is we ought to raise taxes in the middle of a very, very difficult economic environment. I don't think it's a good idea to raise taxes in a middle of an, of a situation like we face today. So we're not talking about extending tax cuts. We're talking about raising taxes.

And then, Candy, they will come back and say, oh, we're only talking about raising taxes on the top income earners. Well, if you do that, you will capture the income of 50 percent of small businesses in this country, the ones right now who are not expanding and hiring.

CROWLEY: I don't know many economists who look at this deficit and don't say you have to do two things here, have you to raise taxes and you have to cut spending. How can the Republicans argue that it is time to get serious about the deficit and let -- and yet argue that these tax cuts should be allowed to stay in place?

It just seems not to make sense. It seems like you're arguing both sides, that -- that you don't want to give benefits to the unemployed until they're paid for, but, by the way, you want to keep the tax cuts in place for people who are quite wealthy, some of them, you know? So it just seems like you're arguing both things here.

MCCONNELL: Well we -- we believe the problem is not that we tax too little, but that we spend too much, and we've had this rate for taxes now for almost a decade. The question is not cutting taxes. The question is raising taxes. What they're trying to do, Candy, is to argue that at this juncture, with this kind of economic environment, we ought to have a significant tax increase. I don't know the economists you're talking to, but the ones I'm talking to are saying raising taxes in the middle of a recession is not a good idea.

CROWLEY: OK, overall, though, a $13 trillion deficit, do you think there is a way to bring down and get rid of a $13 trillion debt without raising taxes? MCCONNELL: I think that we have a serious problem here because we spend too much. I think we ought to concentrate on the spending side. I've on fact been encouraged by the comments of Erskine Bowles, who's one of the chairmen of the president's Deficit Reduction Commission, a Democrat, who's saying that he thinks two-thirds or three-fourths of the problem is a spending problem. So that's where we ought to --

CROWLEY: (INAUDIBLE) --

MCCONNELL: That's where we ought to start.

CROWLEY: OK, could -- but could you say, categorically, that you would never support a tax increase?

MCCONNELL: I can say categorically that I don't think it's a good idea to raise taxes in the middle of a recession, and that is exactly what will happen if they let the Bush tax rates expire at the end of this year.

CROWLEY: Let me try this one -- one more time, and that is, do you see -- absent a recession, do you see a time when you're going to have to raise taxes in order to get rid of a $13 trillion debt?

MCCONNELL: Well, you can't say absent a recession. We're in the middle of a major economic slowdown.

CROWLEY: Oh, the recession wouldn't always be here.

MCCONNELL: The issue is what are we going to do now in the middle of this economic slowdown? I think raising taxes is a terrible idea, and the economists I talk to believe that it's a terrible idea.

CROWLEY: I'm going to call that a maybe.

We'll be right back. Up next, is there anything on the Democrats' to do list that the Republicans will give them a hand on?

(COMMERCIAL BREAK)

CROWLEY: Joining me once again, Senate Minority Leader Mitch McConnell.

Thanks, again, for being here. Very famous quote from you this week that the Republicans have their groove back, but when only 26 percent of Americans say that they believe Republicans would do the right thing for the country, it seems to me that you have a little more grooving to do before you get back in sync with the American public.

MCCONNELL: Well, a more important question than that one -- I don't think the public has a lot of confidence in anybody right now. A more important question than that one is what is called the party generic ballot question. And we had a consistent dead even or ahead position in the party generic ballot question for some months. Candidates are either competitive or ahead in 11 different states now where there are Democratic incumbent senators. The environment is very good for a good year. You still have to actually win the races.

CROWLEY: You do. How many do you think you might pick up?

MCCONNELL: You know I'm not going to answer that question. I think if the election were today, we would have a good day. We'd be in a better position...

CROWLEY: How do you define good?

MCCONNELL: I'd like to be in better shape than the 41 that we have now. And I think the chances of that are pretty good.

CROWLEY: One of the things that the Democrats have painted Republicans as, and it seems to have stuck, is the whole idea of the "party of no," that all you all do is oppose things. I wanted to read to you something that Senator Dick Durbin, who is the assistant Democratic leader, said to Roll Call this week. "Senator McConnell has told Senator Reid, forget it, we're not going to do anything. Other Republican senators have said, we're just not going to give you anything."

So, A, did you say that? But, B, if that is your attitude, then aren't you the "party of no"?

MCCONNELL: Look, what we are proud to say no to, and I think what the public wants us to say no to are things like the government running banks, insurance companies, car companies, nationalizing the student loan business, taking over our health care.

They've just passed, in my view, a terrible financial services bill, supported, interestingly enough, by Wall Street and opposed by community bankers. It's going to require the issuance of 370 new regulations.

We have had an explosion of hiring of federal employees with borrowed money. They have got people over at the FCC trying to regulate the Internet. People over at the NLRB trying to get rid of the secret ballot in labor union elections by regulation. Look, Candy...

CROWLEY: But is being opposed to all of these things enough to get people for you?

MCCONNELL: Yes, we are opposed -- let me make it clear, we are absolutely opposed to all of those things, and proudly so.

There are some things the president is trying to do that we support. We support his efforts in Afghanistan, I think he is on the right track there. I think he continued the policy successfully in Iraq. He says he is for trade deals, where are they? We would like to help him pass them.

He says he is for nuclear power. What is he prepared to do on that? We are for that. He says he is for clean coal technology, we haven't seen any evidence any action on that, but we are for that. So the question is, what are you saying no to? We will proudly say no to the litany of things that I just mentioned a few minutes ago.

CROWLEY: The majority leader has said that he would like to see an energy bill this year. The president wants to see an immigration bill. Any of those things going to happen?

MCCONNELL: Well, it could well be possible that we would do something with regards to the oil spill. Although I must say, this is mainly a failure of the administration. BP caused the spill. It is BP's responsibility to plug the leak. The federal government is in charge of trying to keep that oil off of the shores of the United States.

It took the administration 70 days to order skimmers down to the Gulf.

CROWLEY: In terms, though, of...

MCCONNELL: You can't -- my point is, you can't legislate competence. I think it's -- you know, we are happy to look at oil spill legislation, for example. Do we have the right kind of commission in place to look at what happened? There are aspects of that that might require legislation. But this has mainly been a competence problem on the part of the administration in keeping the oil off of our shores. CROWLEY: How about an overall energy bill, though, cap and trade? Some more investment in alternative energy? I mean, a big comprehensive energy bill, a big comprehensive immigration bill, do you see that -- truly, do you see either one of those things happening this year?

MCCONNELL: A comprehensive energy bill, if it includes cap and trade, you mean a national energy tax. I mean, just think of this, you pick up your bill and you have got a new line on there for a national energy tax. I don't think any of my members are going to be prepared to...

CROWLEY: Well, it's opposing charging companies.

MCCONNELL: Oh, but that will be passed on to the consumers. It is a national energy tax. Seizing on the spill in the Gulf to try to pass a national energy tax strikes me as one more example of what the president's chief of staff said famously early on in the administration, "a crisis is a terrible thing to waste."

In other words, you have you a crisis over here and you try to use that as an excuse to pass a piece of legislation over here.

CROWLEY: Do you even want an energy bill or an immigration bill this year?

MCCONNELL: Energy, I think there are some things we could do. I mentioned them. I mean, we're interested in nuclear power, clean coal technology. I think there are things in the energy area we could and should do. What I am not interested in doing is using the oil spill as an excuse to pass a national energy tax.

CROWLEY: Do you think that there are racist elements in the tea party?

MCCONNELL: Oh my goodness, in the whole country, is there racism?

CROWLEY: Well, as you know, this weekend, NAACP said that the tea -- there are racist elements in the tea party.

MCCONNELL: I am not interested in getting into that debate. What we are interested in is trying to have an election this fall that will respond to what the American people are asking us to do, which is to have some checks and balances here.

They have seen big government on full display for a year-and-a- half. They are appalled. They would like for it to stop. And the best way for it to stop is to have a mid-course correction, which is not unusual in American politics, and I am hoping that is what is coming this fall.

CROWLEY: Nothing that you have seen on TV, including some of the signs that we've seen, albeit the minority at some of these tea party rallies, some of the posters that have been put up in the name of some factions of the tea party make you the least bit uncomfortable? MCCONNELL: Look, there are all kinds of things going on in America that make me uncomfortable, both on the right and on the left. I have got better things to do than to wade in to all of these disputes and discussions that are going on out in the country. What we are trying to do is to make the president a born again moderate. We are trying to send enough conservatives to Congress this November to move him in a different direction.

CROWLEY: Senate Republican leader Mitch McConnell, thank you so much for your time, I appreciate it.

MCCONNELL: Thank you, Candy.

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