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As it is going to be very hard to get the Republican caucus to go for rates they've offered revenue they said look okay fine you won the election we'll give you the 800 billion dollars the let's fight in in a way that has less of an economic impact.
That was Karl -- last night on special report with Bret Baier as he and Joseph Trippi.
Who's a Democrat.
Played the let's make a deal game.
And this is power play and I am in fact Chris -- all Internet and Karl Rove and Joseph -- did pretty well making -- -- for their respective Republican and democratic sides.
But when it gets -- to the real thing regardless of -- talk of whispers going on in deals forming.
External signs indicate that we have a lot of difficult ground to cover for the months to come.
Now I know that's a little dispiriting Internet I know that that does not fill you with joyous holiday.
-- best sense.
But what should fill you with some joyous holiday effervescent -- the Bob Cusack is here.
-- is managing editor of the hill in a -- to viewers it's great to be here effervescent his myself that.
Also an effervescent.
Who joins us from just but about two drivers and a nine iron away from the studios but we have much more -- said -- Mike welcome.
Thank you Chris thanks or having OK so here's the thing.
And that's what I'm wondering Mike let's certainty -- the stud -- over there on Capitol Hill and the question is this.
I see the president out.
And we're gonna talk about this more later in the show but I see the president out basically the labor rally in Detroit yesterday.
John -- -- ready to take the house floor with what is suggested to be -- And unhappy assessment of the current state of negotiations what's the real state of play.
Well I think they're making progress Chris but the bottom line is the Republicans are frustrated that so much of -- Discussion about this issue has been about raising taxes.
And not about cutting spending.
The Republicans will be happy to tell you that spending is out of control in Washington.
And the president has yet to put down.
Serious markers in terms of what he's willing to cut on the spending side of things so we expect that the speaker of the house will take to the house floor.
We had senator Mitch McConnell the Republican leader in the United States senate on the floor earlier.
Essentially punching it at the idea that the president needs to lead on spending cuts.
Something he has yet to do -- Okay so how about this.
Win the Republicans.
Talk about this we've heard what Karl Rove said they -- There's been some discussion that if Boehner tries to force through the speaker tries to force through a deal that includes any tax increases -- -- That is caucus might break and it might even -- and hit the speakership when they get back in session next year.
Well -- there's no question about the fact that John Boehner is walking a very fine line in all of this negotiating with the president who feels like.
You know he campaigned on the idea of upper income Americans paying higher taxes.
And then also trying to keep his caucus in -- keep them.
Reasonably happy with what -- whatever deal they come up with but the bottom line is this speaker does not seem to have the upper hand in terms of negotiating.
The polls all suggest that Republicans would be blamed.
If this deal goes south -- -- if the economy goes down the tubes.
So that he's in a difficult spot.
Everybody I've talked to seems to believe that millionaires will be paying war in some form -- fashion.
Whether it's reduced deductions.
Or whether it's slightly higher rates and we've heard some Republicans saying you know during the Clinton administration.
A lot of Republicans didn't do.
Poorly they did reasonably well -- so they seem to try to give this speaker a little bit of negotiating room if you will to say if rates go up a little bit on really operate -- Americans than.
That maybe what we have to do.
To keep the economy from going off the fiscal cliff.
By the manual he proved not only to be aggressive but Smart -- give him your thanks in your mind -- -- in my -- invited.
Thank you -- So if -- -- -- -- -- -- Situation.
Taking shape here which is this the president doesn't have any reason to be offering real conciliatory thanks to the Republicans because they are.
I believe Jonah Goldberg last -- -- report described it as in -- -- whole skewing it and it worked heroes.
Wish Charles Krauthammer found to be a little too colorful on the panel.
-- the Republicans are are increasingly in disarray there are increasingly freaking out.
The president is surely say whatever he's doing is working.
But if you're the Republicans.
And so he doesn't have much motivation to start giving ground right if you're the Republicans and you realize that whatever happens is probably going to be bad for you don't you also sort of get the feeling that maybe the best thing to do is just go.
You know go hardcore.
Well -- -- -- some Republicans saying let's go over the cliff.
Boehner isn't such a tough position I think he's fair and fairly strong opposition within his own caucus just because.
And no one's gonna really challenge and then.
If you will be reelected as speaker may be somebody doesn't vote for him but generally speaking there's no one's gonna.
Challenging -- him as a team so I do think Boehner is it tough spot and I see that now he says listen.
That that the presence being unyielding there was you know on Friday he said there's been no progress we'll see what he says today but maybe.
Obama doesn't give any ground now but then he gives -- a little something that it may be Medicare means testing something.
That at least -- can go back to his guys and say.
I got this at least an exchange fair.
Tax rates revenue etc.
so by your saying about Obama taking a hard line taking it right up to the edge of the end of the year.
That Boehner can go back to his troops and -- obviously the guy meant.
Business yes and at least I got this for us in exchange for raising taxes that's right now at the left -- -- -- -- -- Obama -- -- and -- -- -- let's -- -- -- -- -- -- -- rich people -- very -- people.
Get less and Medicare surely they would -- that I mean of all the things that they would dislike.
He definitely wanting to of course is -- -- once again that target the -- something Republicans and actually been pushing for -- for a long time -- and so I think they could go along with that but.
No they are raising the tax rates if Republicans agreed that means they have to get something because that's because Democrats and a lot that they finally broke the Republicans back.
He is Karl Rove was pointing out and others have pointed out.
And did president.
Needs to provide something in the way of cuts he needs to -- something.
On this order.
I'm hearing more and more Republican voices that say you know that that's not so bad maybe we should just -- maybe maybe.
Make Obama -- -- if he wants to go hard right let him go hard and make a moment.
And that's where it's so risky for Obama and Boehner I mean if you look at history.
The house Republican majority is fairly safe because in the president's second term his mid term.
It's probably gonna be Republicans picking up seats but if republicans' goal of the -- and they get blamed and polls do show that they would get blamed.
Then all bets are off now of course Yvonne Porter had had a good point recently when he was going through other showdowns you know spent decades ago is that -- -- member of the speaker wasn't -- -- in the audience didn't remember who the present.
Once and that's the risk from a -- They remember Newt Gingrich that that's shooting -- extra -- that was one critically.
Clinton -- anymore yet.
Clinton Clinton gambled anyone -- in those in that time we're talking about government shut down.
And we should talk more about that everything you love to talk about shutting down the government it's just fun it's just a pre Christmas Chanukah era frolic.
To talk about -- on the -- we'll do that when we come back we'll get to some of you were comments commentary Internet.
And we will do all of that when we come back.
So stick around.
We will play that game Mr.
President -- not a game to game -- playing a small ball.
You're talking about raising rates on the top 2% that would run the -- eleven days you just got reelected how about doing something -- that's not.
Liberal how but doing something big that really is not partisan.
That was Lindsey Graham.
He's a Republican senator from South Carolina and he was with the your friend of -- Martha MacCallum on America's Newsroom yesterday sounding a little more bellicose.
Senator Graham had been one of the Republicans that originally said that he wasn't so worried.
About Grover Norquist it's tax -- protection pledge but now seems to be feeling a little more upset at the president.
As negotiations take on to -- John and moderate Republicans like -- are looking for some show.
That there is a big deal possible that something bigger might happen Bob Cusack.
What the game.
That Lindsey Graham's argument there.
Was the president had said that what -- will not play that game when it comes to negotiating over the -- -- now we're looking at.
New president got 2.2.
Trillion dollars in borrowing authority in August it sounds like a lot.
But we spend a lot so we go we go through that pretty quick we borrow a lot of money so we're looking at that and.
Managed default default or shutting down 40%.
Of the rest of the government that is -- that excludes the did you -- by the way Internet that eight about 8% of everything with federal government spends its interest on debt.
That's kind of not fun and that's like that is like that is like having a whole house decorated this rental furniture.
And the TV has long been broken and then you're still paying it off that's not it's like it's -- would have had the good times but the the Republicans are increasingly saying you know what we can make it stick on the debt ceiling the president says if you try that -- That white SS as they won't raise it unilaterally they dash the hopes of Democrats said.
We don't have the power to try to do it.
Department because the bond market would say I don't think we'd like to be have money tied up in -- -- constitutional crisis in your country right they say that the Republicans it's such a reckless thing that they can basically.
Shame the Republicans in the giving them.
Yeah I mean some Democrats say that Republicans at some point -- gonna have control the White House and and and -- gonna wanna deal with this fight just like Obama has but you know the reason that.
Boehner has said even though it was so tumultuous in the summer of 2011.
That he had leverage on and you want to -- my default but -- he forced some cuts now they weren't.
Good enough recipes -- in the nation was downright invigorating so that's another reason that it.
UConn received consent of congress -- deadlines and that's why Republicans say why we gonna give up this power.
When it when else are we gonna cut because who likes to cut -- it's not politically popular now by Washington has spent for decades.
And -- -- is we've retired -- yes it's and his team bring that up for forty years America was a lot easier to govern.
Because you could just get some money out there spread things around us and it was a lot easier to do than when you're in a time of austerity it's a lot harder to make deals.
When you don't have that who fiscal -- yes right.
And he when you talk about legacy whether it's you know health care or any type of expansion of Medicare Medicare prescription drugs Republicans pushed through you know those things cost -- And it's very difficult to pay for them and and that's why but here -- -- I think Obama sees an opportunity.
For legacy of of getting me -- -- -- either beat down payment now and then later thumb because otherwise history may not be content that.
What's he doing to indicate to you now that he might want that I keep hearing this right I keep hearing all the -- the -- president you know wants a bigger deal once and for trillion dollar deal he says it but I -- not seeing anything that would tend to corroborate that.
Yeah publicly now because he has the leverage he's enjoying it and it was reported that.
That present model and up to congressman Tom Cole at the White House holiday party he said.
Listen -- only go a little time.
Oh we got to set a W I said of the -- Tom COLT is -- Conservative issue congressman from Oklahoma who used to run the Republican national congressional campaign committee and and he has been out calling for Republicans to.
Ditch the whole concept of cliff -- on the middle class tax rate he says yes has it now it's not a -- you're not you're not increasing anybody's taxes.
Take that weapon away from the president for him to go out and be able to tell you tell Americans if you want to -- -- time.
And he says that would not violate -- over north coast -- you know which.
If -- -- -- -- -- -- -- -- raising anybody's taxes but Obama said to calls and listen up you know I'm Melinda media you know.
I'm let me give you something it provide specifics -- that the Christmas party but that and that's where I think that you know Obama wants to move on he wants to.
He wants to do immigration -- You know and if this is still lingering in -- genuinely -- -- -- -- Who knows what's gonna.
But it doesn't he have to figure that he'd rather move on with -- with -- back broken Republican Party yes and he would move bond with one that has been in the old or in any way strengthened in the.
This process I think Obama has to decide okay I could probably win this negotiation.
And push it all the way up -- the -- and get 90% of what I want maybe 85%.
Or maybe do I wanna get 70% or 65%.
And get a deal.
He -- stuff he -- stuff and he's kind enough to make time for you Internet.
To tell you about it you should follow him at Bob Cusack you should -- him at the hill because it's it's a good newspaper.
And we appreciate you thank you Chris -- that Internet.
One other thing before we go.
I'm -- several that's the answer on who make that little fist that's the ads on I'm patsy start -- you can follow me there and if you do.
You could have already had.
-- enjoyed steeped in enjoyment.
My column today.
A power play.
Obama's show's second term swagger and Michigan labor unrest and I was there any talk about I explained to you.
What you can tell about -- term Barack Obama from the way he dealt with what's happening in Michigan.
And it's labor disputes as opposed to what happened in Wisconsin.
Two different kinds of Obama's we will explore that question when we come back with a Smart fair minded clear eyed and -- so stick around.
Bat and there was a lot of cheering that followed that I promise and and that was President Obama speaking at what turned out to be sort of a campaign rally.
That he held in Detroit.
At a -- -- diesel plant there and this is power play.
And the Barack Obama you saw on display yesterday.
Talking diving into an ongoing labor dispute that's taking place in the state of Michigan is very different -- about -- that you saw on issues of labor.
And other things pre reelection so what does what he's doing now and how he's acting now tell us about but the rest of this -- look like.
And what does it portends toward the cliff jump.
The looming at the end of the year.
I think we have to perfect people to talk about that subject Internet.
You know Michelle -- That is the recruiting are essentially of the best right wing conspiracy they help identify and find promising.
Young or novice candidates train them bring them into the political system to fill the bench for the red team.
And you know I know you know Garland next and he is the use -- radio show host.
Under the PFW yes I here in Washington DC he's Smart he's funny we like him so we welcome you both.
Are you happy to be here so absolutely zero so far we'll see how that goes we'll see if that holds up so here's the thing.
And -- -- I -- -- start with -- we saw two years ago and a year ago in Wisconsin.
A huge fight erupts between labor unions.
And Republican lawmakers in Madison.
And I want to tell -- went out there it was ugly it was ugly ugly ugly I have.
Never been to don't stand by the box truck in Madison by the way on the street corner just hanging out that's not the place to get warm.
Was -- greetings.
But the the president basically steered clear of that -- now.
You have something that is less ideologically charged right to work which is something that's in 24 other states.
As was what's got what was -- in Wisconsin president dives right in what does that tell you.
Well it tells me that the president feels very much power I think is something that that that.
Cause that was the the way the the the election turned out that he actually you know -- -- states they didn't think he was gonna win I think 889 -- -- I think after this the identity the president is looking back and he's feeling strong he's -- -- as -- -- I think the first four years he felt like he couldn't be drawn into any serious fights so I think he feels -- I think he feels.
Ready to go toe to toe with the GOP you remember.
The nuclear summit and the line to Dmitry Medvedev as the pocket -- -- That he said to the president was overheard -- on a hot Mike.
Say at -- Vladimir.
That after the election I will have more flexibility.
He's got more flexibility when -- come I don't know what he's gonna do by missile defense but he's got a lot more flexibility when it comes dealing with -- people.
That's -- he's out of the -- of voters at this point you know and he was cautious about energy acting in Wisconsin and in Chicago of all places earlier this year when -- union protests and I was just because.
And he had an election to run and and didn't want -- on the -- side of the argument but now you know he he's untouchable and clearly he's going to be governing from the left it's not the clintonian model where you realize that you know there has to be some sort of bipartisanship -- -- centrist.
Rule making to get things done in fact he he's moving ten.
But you know the leftist principles that he believes in and and this -- -- on him.
Okay so in let's talk about what's at stake in Michigan what's going on in Michigan it took 44 states mostly mostly and I'm not gonna take you all the way back to Taft Hartley.
24 states in the country that are mostly in the south and in the -- Mostly Republican states have what are called right to work laws that say that you cannot have a close shop that is to say that if the union organizers and in a place of employment.
That you cannot be compelled to pay -- to that union.
In those states that's what it says if you live in Virginia or North Carolina or Indiana or state like that you are not.
Going to be forced to join a union just because majority of the people at your work for at your workplace once voted.
That they wanted to -- union members but Michigan Garland is.
That sort of beating heart well the coal country is that beating heart of America's labor -- that's the soul of America's laborers union.
Movement but Detroit in the UAW that's a big deal for this to be able to pass and it looks like it will in Michigan as it is a big deal -- -- It is and I think the way it happened was this the governor initially said he didn't support it he says you know he didn't think this is a good idea and you know once he's realized easily conducting looked over children's that a lawyer I can do what I wanna do now.
So I think there was a little bit of you know.
Not shouldn't you know -- he wasn't exactly square with the people it is -- and.
Why -- he never -- -- -- -- and it wasn't he wasn't supported this wasn't the time but way back have been his Snyder the -- because Snyder just got elected just value and Obama's state of -- exactly the transatlantic surely they don't believe okay.
-- -- -- -- -- -- -- -- So he.
So the Republicans are saying they want to bring this right to work there Michelle for Democrats.
They have a big interest in this especially because there's two versions of the bill what they're doing up in Michigan is now there and that he reconciliation process between the senate bill and house bill.
The house bill I believe one of the two bills includes government workers in this if you do that.
And Michigan has -- the highest percentages of labor union membership if you do this in Michigan not only are you going to.
Knock the wind out of labor and they are sort of emotional homeland.
But also you're gonna.
Killed Democrats in Michigan.
Yeah that's sure -- -- so.
A big -- in the -- think after.
Their loss in November even try to get collective bargaining into the constitution now there's this.
Unions in general Austin Wisconsin I think it's just a big at big bloated and and I would suggest instead of you know rallying protests -- shipping and people from out of state.
Encouraging teachers take time off of work instead they refocus on what services are offering to their members to -- tell people to join the union.
Are on our back in Washington.
And they're saying.
We're going to entice President Obama into doing a bigger deal in the wondering what kind of tax rate increased.
And it's like they're having two different discussions Republicans are back here in Washington like.
Well if we give him this maybe he'll give us that.
The president is out there I listen to a man on the stump yesterday that said hey give you nothing I didn't come here to give you stuff I just won an election.
We picked up seats in the house we picked up seats in the senate when we were supposed to lose them and I won you lost so get the project.
Well I think what's -- Illinois he's actually kind of he's he's making his demands and he's sitting on the sideline because the issue is.
The fight between the wings of the Republican Party.
There are those wise people in the Republican Party who recognize the need to make a deal but there is a very -- days of angry about this -- could definitely say I heard about -- yeah yeah -- -- -- -- deal so I think he's kind of making his visit is his voice heard and he's gonna sit on the sideline and kind of see what.
What becomes of the fight within the Republican Party has an idea and so he would like to see who hold important -- it's that he would like to see eight.
Can't ballistic at Christmas and much more that would be -- that and I did an awesome -- He's got that on his wish -- and he's he's a -- -- this fight on his terms right we're talking about increasing taxes on the wealthy it's not about.
But the original problem was that just deficit spending and the debt ceiling limit is so he can sit back he's in control of the game and I Republicans I think -- just the cities with say with the Republicans was immediate fix -- they -- -- addition.
They've got the debt ceiling he doesn't wanna see -- use it as leverage but it honestly it's only leverage they -- this point to get some sort of promised on entitlement spending.
Come next year.
Now we -- Now wait a minute and Garland I'm listening to a Republican Party that says.
We need to hurry and increase taxes so that we can cut Medicare next year this is not sound to me like yeah.
Hurry -- tax ideology you know what I mean we've got to get through the tax increase we can hurry cut entitlements yet that does not sound like something that's going to middle.
I don't don't let what little we really didn't seem to be talking about at the end of the day not is not just kind of turning its growth -- way to get rid of our deficit.
On the ground in his ten.
-- -- on taxes on people aren't gonna help growth if we had unemployment down a -- 5% in growth in our economy is up to three or 4% we get rid of half our deficit.
Those that -- the -- It is politically wise because the numbers say most Americans want taxes raised on the wealthy so they're inviting us -- -- that Americans want.
Spending cuts -- right so they're fighting a losing battle was always -- -- that taxes on the wealthy gay marriage headed downhill with that that's when they can't win and I think that's why some of the Republicans are saying we need to get out from under this what.
Talk about -- Talk about growth OK well let's let -- to do something for growth sensitive kind of felt -- taxes -- the answer.
All right folks.
-- -- -- succeeded in -- yeah -- that we thank you for your advice counsel and your advised both of you.
And we won't want to talk to you soon Christopher Todd says this.
Is there much or any concern for Republicans that if they were to cave on tax rates now in hopes of a bigger spending deal next year.
With the debt ceiling as a bargaining -- that the president would continue to back the Republicans into -- corner to force what he wants and never actually budgeted spending cuts.
Yes that's what Republicans are concerned about that is there preeminent concern is that if you start a negotiation.
By caving in on the first point he will keep caving and keep caving in keep caving because if you can't hold the line at the beginning now they know where you're weak spots are and and they can pick you apart.
So that's something cheerful again cheerful thoughts Republicans out there today.
Cheerful thought to include this on the hunt with Jonathan Hunt -- coming up next that cheers you that could chew it that -- your yuletide.
The mock tank.
These so called wise Republicans are also called -- as well this.
Remember not to expect the big ones admired in the other party is -- generally are the ones that are closest to their own way of thinking.
So that's something else thing about but how about some power points would you like to have some I think -- would.
Slow motion disaster.
The most conservative American president of the twentieth century said this when you don't know what work to do.
Do the work that's in front -- -- that was Calvin Coolidge.
Who said that.
And the the deal here is this the president's -- campaign.
-- Republicans are fighting amongst themselves in a vicious battle about how to raise taxes and which entitlements they would like to cut and all of that other stuff.
The clock is ticking it's almost done it's time for people to do the work that's in front of them when you don't know what to do do the work that's in front of you.
Should go for the president and it should go for the speaker there's stuff to do here it's time to get busy about the business of doing it.
Says here's your second point if there is a self awareness -- deficit.
In Washington yes we have a fiscal deficit but we have a self awareness deficit.
As it relates to what voters really think about what's going on and how high up Democrats are and how far down Republicans are these things are ephemeral and we are currently in the hangover from election and it makes people weird it makes them act weird it's not cool.
So here's the third point in all of this and the reason that people should quit -- was going so slowly into this disaster and that is.
It is a reverse Heisenberg principle it was Heisenberg.
Who pioneered the fact that by observing.
Reactions in physics that you have an effect upon them in this case it is.
You were first what's happening in Washington is having an effect.
And those who -- observing -- the people out of America who are buttoning up their wallets the businesses that are not hiring.
And pinching down on the economy the longer they screw around with this the -- they will make it so that's what I think.
Thanks to make him some time for us today and now we want to do every -- we want to leave you with the word from our French -- It's.
An early as Everett -- a war and our history where the president speaks less about.
And -- is less support on behalf of a real ongoing.
Operation where Americans are dying if that's our mission which is minimal.
Getting out why -- these -- soldiers.
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