PELOSI: It would -- no, I don't think so. I think it would -- it would be -- bringing middle-income tax cuts to the floor now, passing those would help our economic recovery, would be a clear signal that the upper-end tax cuts for the wealthy will expire, because they will not be -- the middle-income tax cuts will not be held hostage to those, and that we can go to the table and say, what are the cuts we need to make? What are the -- what is the revenue that we have?
Assuming the expiration of the high-end tax cuts, how do we create growth for small businesses, the entrepreneurial spirit of America? This is exactly the path we should go down. We should work together. They're over the edge. We want a balanced approach.
STEPHANOPOULOS: The speaker's pretty clear about having pressure from his own conference. He talks about being leader. He says it's like having 218 frogs in a wheelbarrow. And -- and I wonder how much pressure you're going to face from your own members on this.
A couple of weeks ago, you actually said you would vote for the Simpson-Bowles deficit reduction plan. And that has caused a former member, Senator Russ Feingold, to call that a potential capitulation on bedrock values. He says it makes it easier for corporate Democrats to join with corporate Republicans and destroy these programs. What do you say to Democrats who...
PELOSI: I don't think...
STEPHANOPOULOS: ... believe that?
PELOSI: ... he understands what that is. What I said was -- and what I believe is, that the framework of Simpson-Bowles was a very important one. It assumed the expiration of the high-end tax cuts. It took a harsh look at all of our spending, including our defense...
STEPHANOPOULOS: Including Medicare and Social Security.
PELOSI: ... our defense spending. It -- it was -- had a proper balance between cuts and revenues that we have to have. What I didn't like about it was what it said about Social Security, but I said that can be handled separately. Social Security, whatever we do on Social Security should be returned to Social Security to extend its life.
What this is about, though, is about the creation of jobs. How do we do that as we do our budget? We do it by a balance between establishing our priorities, making some cuts, but making sure that we're investing in the future and bringing in some revenue.
And so I -- our members have been very -- we stuck with the president on the grand bargain that he had last year, that he and the speaker agreed to, and then the speaker walked away from. He walked away from it.
STEPHANOPOULOS: As you know, he says the president upped the ante on him and demanded more tax increases.
PELOSI: That's simply not true (inaudible) you told that, because it's simply not true.
STEPHANOPOULOS: One other thing he seems quite confident on is if this election is about the economy, the Republicans are going to win.
PELOSI: The fact is, this election, if it is about the economy, the president will make his case that he has been a job-creator from day one. And the president's record of job creation, taking us from a deep recession, almost a depression, to a hopeful place, versus whatever the Republicans will propose, but they have stood in the way of every job piece of legislation that would be significant in that regard. But let's have the debate.
STEPHANOPOULOS: If the election were held today, do you think the Democrats would win?