'This Week' Transcript: Former Florida Gov. Jeb Bush, Powerhouse Roundtable

(CROSSTALK)

JOHNSON: You've made my point -- you've made my point, we have to agree on the facts.

(CROSSTALK)

KRUGMAN: But the facts are false.

JOHNSON: No they are not.

(CROSSTALK)

JOHNSON: They are not false.

KRUGMAN: The Social Security thing, Social Security is -- there -- it has a dedicated revenue base. It has a trust fund based on that dedicated revenue base. You can't change the rules midstream and say, oh suddenly...

(CROSSTALK)

JOHNSON: See here's -- here's the problem...

(CROSSTALK)

JOHNSON: ...here's the problem with the trust fund, the federal government owns U.S. Treasury bonds, it's the same thing as if you have $20.00, you spend it. And by the way, that money is spent, it's gone. You write yourself a note for $20.00, stick it in your pocket and say, I got 20-bucks.

(CROSSTALK)

JOHNSON: No, you don't. You -- you have a note that you have to sell in the open market. The trust fund is a fiction, it doesn't -- it's...

(CROSSTALK)

KRUGMAN: If you -- if you want to think of Social Security as not just being part of the government, then there's no such thing as a Social Security problem, it's just part of the general budget. You -- you cannot say on the one hand...

(CROSSTALK)

KRUGMAN: ...on -- on the other hand we're going to -- we're going to restrict it to only operating off of...

(CROSSTALK)

KRUGMAN: It's -- but it's important to realize that the facts that are being brought out here are in fact, non-facts. And how...

(CROSSTALK)

WILL: As Pat Moynihan said, "Everyone is entitled to their own opinion, but not their own facts", and we're going to start this chimeric negotiation from two sides that can't agree on the most basic thing...

(CROSSTALK)

JOHNSON: That's the first thing we have to...

(CROSSTALK)

STEPHANOPOULOS: We're going to have a lot more information...

(CROSSTALK)

STEPHANOPOULOS: ...hold on one second, we'll have a lot more information on the table this week. We're going to have budgets put forward in both the House and the Senate, Democrats in the Senate, Republicans led by Paul Ryan in the House. Jon Karl has more on that.

JONATHAN KARL, ABC NEWS: This one, which again includes those fundamental changes to Medicare, may actually be more controversial than his last one, because this time Ryan is promising to balance the budget in 10 years. His last budget didn't balance until way out into the 2030's. And he's doing it entirely with spending cuts. In fact I am told he will leave the spending levels under the sequester in place for the next 10 years. Meanwhile, the Senate is going to do something that they haven't done in four years, they're actually going to release a budget.

Senate Budget Chairman Patty Murray is not promising to balance the budget, but she is promising to undo the sequester with a mix of tax increases, and spending cuts found elsewhere. George?

STEPHANOPOULOS: Juliana Goldman, nothing from the White House probably until April, no White House budget until April. But Paul Ryan now able to get to balancing in 10 years instead of 30, in large part because the economy has been doing better?

GOLDMAN: Yeah, and because he's counting the revenues from the fiscal cliff deal, $600 billion, also savings from the Affordable Care Act as well, but this is an important week for budget talks. The battle lines really are being drawn here, and we are going to see just how far apart both sides are. I think one of the questions for the White House, and this is why they started the charm offensive last week, to start softening the field here, it's how they're going to respond to the Ryan budget.

They say that they're going to respectfully point out the differences that they have, but the devil will be in the details about how respectful they're going to be. Nobody wants to see a replay of when the president famously gave his budget speech in 2011, and hammered Paul Ryan sitting in the front row there. And so it will be a test of whether this civility will continue.

STEPHANOPOULOS: So, George Will, we're going to have everything on the table, probably by the end of the week. But my guess is that everyone, both in the House and Senate is still going to be hanging back until the summer, to wait and see what really happens when the sequester starts to kick in, and then when we face this next deadline, the government running out of its borrowing authority, sometime this summer.

WILL: The Republicans like the sequester so far. But so far they like the sequester. And when Senator Murray begins by saying, we're going to end the sequester, she's saying I am going to end the one thing Republicans think they've won in the last year in Washington.

STEPHANOPOULOS: Are they going to like it in June?

KRUGMAN: No because this is -- you know -- people talk. The sequester is mostly falling on discretionary spending. Discretionary spending is easy to cut, because we just say let's -- let's cut that number. Until you start to see the consequences. And it will start to build, and it won't just be White House tours, it will be air traffic delays, it will be -- you know there will be a lot of things that people actually value.

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