Obama Has Tense Visit With House Republicans

President Barack Obama attended the House Republicans retreat in Baltimore, Md., on Friday, and had some heated exchanges with Republican lawmakers over health care, the economic stimulus and taxes. Obama criticized what he called the GOP's "politics of no."

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NEAL CONAN, host:

On the Opinion Page this week, a variation from our usual format. On Friday, President Obama spent an unusual hour exchanging opinions with Republican members of the House of Representatives who were meeting in Baltimore. He got a polite introduction from Minority Leader, John Boehner of Ohio.

President BARACK OBAMA: I very much am appreciative of not only the tone of your introduction, John, but also the invitation that you extended to me. You know what they say, keep your friends close but visit the Republican Caucus every few months.

(Soundbite of laughter)

CONAN: After his remarks, the interesting part. The President took questions from a few opposition members, some quiet pointed, and he responded in kind. We're going to play two substantial exchanges. We begin with Congressman Jeb Hensarling of Texas.

Representative JEB HENSARLING (Republican, Texas): Jeb, Mr. President.

Pres. OBAMA: How are you?

Rep. HENSARLING: I'm doing well. Mr. President, a year ago, I had an opportunity to speak to you about the national debt. And something that you and I have in common is we both have small children.

Pres. OBAMA: Absolutely.

Rep. HENSARLING: And I left that conversation really feeling your sincere commitment to ensuring that our children, our nation's children, do not inherit an unconscionable debt. We know that under current law, that government - the cost of government is due to grow from 20 percent of our economy to 40 percent of our economy in right about the time our children are leaving college and getting that first job.

Pres. OBAMA: Mm-hmm.

Rep. HENSARLING: Mr. President, shortly after that conversation a year ago, the Republicans proposed a budget that ensured that government did not grow beyond the historical standard of 20 percent of GDP. It was a budget that actually froze, immediately, nondefense discretionary spending. It spent $5 trillion less than ultimately what was enacted into law. And unfortunately, I believe that budget was ignored.

And since that budget was ignored, what were the old annual deficits under Republicans have now become the monthly deficits under Democrats. The national debt has increased 30 percent. Now Mr. President, I know you believe and I understand the argument - I respect the view that the spending is necessary due to the recession. Many of us believe, frankly, it's part of the problem not part of the solution, but I understand and I respect your view.

But this is what I don't understand, Mr. President. After that discussion, your administration proposed a budget that would triple the national debt over the next 10 years. Surely you don't believe 10 years from now we will still be mired in this recession. It proposed new entitlement spending and moved the cost of government to almost 24 and a half percent of the economy. Now, very soon, Mr. President, you're due to submit a new budget. And my question...

Pres. OBAMA: Jeb, I know there's a question in there somewhere...

(Soundbite of laughter)

Pres. OBAMA: ...because you're making a whole bunch of assertions, half of which I disagree with and I'm having to sit here listening to them. At some point, I know you're going to let me answer.

Rep. HENSARLING: Well, that...

Pres. OBAMA: All right.

Rep. HENSARLING: ...that's the question. You are soon to submit a new budget, Mr. President. Will that new budget, like your old budget, triple the national debt and continue to take us down the path of increasing the cost of government to almost 25 percent of our economy?

Pres. OBAMA: All right...

Rep. HENSARLING: That's the question, Mr. President.

Pres. OBAMA: Jeb, I with all due respect, I've just got to take this last question as an example of how it's very hard to have the kind of bipartisan work that we're going to do, because the whole question was structured as a talking point for running a campaign. Now look, let's talk about the budget once again, because I'll go through it with you line by line. The fact of the matter is that when we came into office, the deficit was $1.3 trillion; 1.3.

So when you say that suddenly I've got a monthly budget that is higher than the or a monthly deficit that's higher than the annual deficit left by Republicans, that's factually just not true. And you know it's not true. And what is true is that we came in already with a $1.3 trillion deficit before I had passed any law.

And what is true is that we came in already with a $1.3 trillion deficit before I had passed any law. What is true is we came in with $8 trillion worth of debt over the next decade - had nothing to do with anything that we had done.

It had to do with the fact that in 2000, when there was a budget surplus of 200 billion, we had a Republican administration and a Republican Congress and we had two tax cuts that weren't paid for. We had a prescription drug plan - the biggest entitlement plan, by the way, of several decades - that was passed without it being paid for. We had two wars that were done through supplementals, that - and then you had $3 trillion projected because of the lost revenue of this recession. That's $8 trillion.

Now, we increased it by a trillion dollars because of the spending that we had to make on the stimulus. I am happy to have any independent fact-checker out there take a look at your presentation versus mine in terms of the accuracy of what I just said. Now...

Rep. HENSARLING: (Unintelligible) Mr. President.

Pres. OBAMA: And now, going forward, here's the deal. I think Paul, for example, head of the budget committee, has looked at the budget and has made a serious proposal. I've read it. I can tell you what's in it. And there are some ideas in there that I would agree with but there are some ideas that we should have a healthy debate about because I don't agree with them.

The major driver of our long-term liabilities, everybody here knows, is Medicare and Medicaid and our health care spending. Nothing comes close. Social Security, we could probably fix the same way Tip O'Neill and Ronald Reagan sat down together and they could figure something out. That is manageable. Medicare and Medicaid: massive problem down the road. That's where - that's going to be what our children have to worry about.

Now, Paul's approach - and I want to be careful not simplifying this because I know you've got a lot of detail in your plan - but if I understand it correctly, would say we're going to provide vouchers of some sort for current Medicare recipients at the current level...

Rep. HENSARLING: No.

Pres. OBAMA: No?

Rep. HENSARLING: People 55 and above.

Pres. OBAMA: Fifty-five - well, no, I understand. I mean, there's the grandfathering in, but just for future beneficiaries, right? That's why I said I didn't want to - I want to make sure that I'm not being unfair to your proposal, but I just want to point out that I've read it. And the basic idea would be that at some point we hold Medicare cost-per-recipient constant as a way of making sure that that doesn't go way out of whack. And I'm sure there are some details that...

Representative PAUL RYAN (Republican, Wisconsin): We (unintelligible) it at a blend of inflation and health inflation.

Pres. OBAMA: Right.

Rep. HENSARLING: The point of our plan is, because Medicare, as you know, is a $38 trillion unfunded liability...

Pres. OBAMA: Right.

Rep. HENSARLING: ...it has to be reformed for younger generations, because it won't exist because it's going bankrupt. And the premise of our idea is, look, why not give people the same kind of health care plan we here have in Congress? That's the kind of reform we're proposing for Medicare.

(Soundbite of applause)

Pres. OBAMA: Well, look, as I've said before, this is an entirely legitimate proposal. The problem is twofold. One is that depending on how it's structured, if recipients are suddenly getting a plan they have their reimbursement rates going like this, but health care costs are still going up like that, then over time the way we're saving money is essentially by capping what they're getting relative to their costs.

Now, I just want to point out - and this brings me to the second problem. When we made a very modest proposal as part of our package - our health care reform package - to eliminate the subsidies going to insurance companies for Medicare Advantage, we were attacked across the board by many on your aisle for slashing Medicare. You remember? We're going start cutting benefits for seniors. That was the story that was perpetrated out there, scared the dickens out of a lot of seniors.

Unidentified Man: (unintelligible).

Pres. OBAMA: No, but here's my point. If the main question is going to be what do we do about Medicare costs, any proposal that Paul makes will be painted factually from the perspective of those who disagree with it as cutting benefits over the long-term. Paul, I don't think you disagree with that, that there is a political vulnerability to doing anything that tinkers with Medicare. And that's probably the biggest savings that are obtained through Paul's plan. And I raise that not because we shouldn't have a serious discussion about it. I raise that because we're not going to be able to do anything about any of these entitlements if what we do is characterize whatever proposals are put out there as, well, you know, that's - the other party is being irresponsible, the other party is trying to hurt our senior citizens, that the other party is doing X, Y, Z.

That's why I say if we're going to frame these debates in ways that allow us to solve them, then we can't start off by figuring out A, who's to blame, B, how can we make the American people afraid of the other side. And unfortunately, that's how our politics works right now and that's how a lot of our discussion works. That's how we start off. Every time somebody speaks in Congress, the first thing they do, they stand up and all the talking points I think Frank Luntz up here, sitting in the front. He's already polled it and he said, you know, the way you're really going to - I've done a focus group, and, you know, the way we're going to really box in Obama on this one or make Pelosi look bad on that one, I know - I like Frank. We've had conversations - between Frank and I. But that's how we operate. It's all tactics, and it's not solving problems.

CONAN: That exchange between the president and Congressman Jeb Hensarling of Texas on Friday. You're listening to TALK OF THE NATION from NPR News.

And in that exchange, you heard references to Paul that's Congressman Paul Ryan from Wisconsin. Here's his exchange with President Obama.

Representative PAUL RYAN (Republican, Wisconsin; Ranking Member, House Budget Committee): I serve as the ranking member of the Budget Committee, so I want to talk a little budget, if you don't mind.

Pres. OBAMA: Yeah.

Rep. RYAN: This spending bill that you have signed into law, the domestic discretionary spending has been increased by 84 percent. You now want to freeze spending at this elevated level beginning next year. This means that total spending in your budget would grow at three hundredths of one percent less than otherwise. I would simply submit that we could do more and start now.

You've also said that you want to take a scalpel to the budget and go through it line by line. We want to give you that scalpel. I have a proposal with my home-state senator, Russ Feingold, a bipartisan proposal, to create a constitutional version of the line-item veto.

(Soundbite of applause)

Rep. RYAN: Problem is we can't even get a vote on the proposal.

So my question is, why not start freezing spending now? And would you support a line-item veto and helping us get a vote on it in the House?

Pres. OBAMA: Let me respond to the two specific questions, but I want to just push back a little bit on the underlying premise, about us increasing spending by 84 percent.

Now, look, I talked to Peter Orszag right before I came here, because I suspect I'd be hearing this - I'd be hearing this argument. The fact of the matter is, is that most of the increases in this year's budget, this past year's budget, were not as a consequence of policies that we initiated, but instead were built-in as a consequence of the automatic stabilizers that kick in because of this enormous recession. So the increase in the budget for this past year was actually predicted before I was even sworn into office and had initiated any policies. Whoever was in there, Paul - and I don't think you'll dispute that...

Rep. RYAN: No.

Pres. OBAMA: Whoever was in there would have seen those same increases because of, on the one hand, huge drops in revenue, but at the same time, people were hurting and needed help. And a lot of these things happen automatically.

Now, the reason that I'm not proposing the discretionary freeze take in to effect this year - we prepared a budget for 2010, it's now going forward - is, again, I am just listening to the consensus among people who know the economy best. And what they will say is that if you either increase taxes or significantly lowered spending when the economy remains somewhat fragile, that that would have a destimulative effect and potentially you'd see a lot of folks losing business, more folks potentially losing jobs. That would be a mistake when the economy has not fully taken off. That's why I've proposed to do it for the next fiscal year. So, that's point number two.

With respect to the line-item veto, I actually - I think there's not a president out there that wouldn't love to have it. And, you know, I think that this is an area where we can have a serious conversation. I know it is a bipartisan proposal by you and Russ Feingold. I don't like being held up with big bills that have stuff in them that are wasteful but I've got to sign because it's a defense authorization bill and I've got to make sure that our troops are getting the funding that they need.

I will tell you, I would love for Congress itself to show discipline on both sides of the aisle. I think one thing that, you know, you have to acknowledge, Paul, because you study this stuff and take it pretty seriously, that the earmarks problem is not unique to one party, and you end up getting a lot of pushback when you start going after specific projects of any one of you in your districts, because wasteful spending is usually spent somehow outside of your district. Have you noticed that? The spending in your district tends to seem pretty sensible.

So I would love to see more restraint within Congress. I'd like to work on the earmarks reforms that I mentioned in terms of putting earmarks online, because I think sunshine is the best disinfectant. But I am willing to have a serious conversation on the line-item veto issue.

CONAN: President Obama at last Friday's meeting of the Republican congressional caucus in Baltimore. That exchange with Wisconsin Republican Paul Ryan.

Tomorrow, adoption and abduction: saving Haiti's children. Tune in for that on TALK OF THE NATION from NPR News. I'm Neal Conan in Washington.

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