'This Week' Transcript: Jacob Lew and Jon Kyl

MR. LEW: Thank you.

MS. AMANPOUR: Thank you, indeed.

And the parties are in a bit of a cooling-off period after a contentious series of White House meetings. At one point, tempers flared between President Obama and the number-two House Republican, Eric Cantor. Witness to it all leaders of both parties including House Speaker John Boehner and his Democratic counterpart Nancy Pelosi, Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell were also at the table. And so was my next guest today, Minority Whip Senator Jon Kyl of Arizona.

Thank you very much for joining us.

SENATOR JON KYL (R-AZ): Thank you, Christiane.

MS. AMANPOUR: You just heard the budget director, Jack Lew, saying absolutely a deal will be done and this country will not default. Are you there as well with that?

SEN. KYL: The country will not default. Whether or not there are savings achieved in the process remains open to question.

MS. AMANPOUR: What kind of a deal do you think is going to be done? We've heard a resurrection of the grand bargain. Do you think that's possible?

SEN. KYL: Unless the president gets off of his absolute obsession with raising taxes, Republicans are not going to agree to do anything that will harm our economy. And job-killing taxes will harm our economy.

So there will not be a default, but as to whether or not we can achieve savings in the process, again, depends on the president.

MS. AMANPOUR: Let me quickly ask you first then how will there not be a default? What do you believe will be the outcome? You're at that table.

SEN. KYL: Right.

Republican leaders have made it clear that, if all else fails, if our efforts to adopt legislation to cut the deficit, put a straightjacket on it and balance the budget -- the so-called, cut, cap and balance -- I think that passes the House. But if that doesn't pass the Senate and if there is no other way to reach some kind of savings agreement then, at the end of the day, Republican leaders have made it clear that we will not be the ones who put the government into default.

MS. AMANPOUR: So that would be the Mitch McConnell last-ditch effort?

SEN. KYL: Well, it's McConnell-Reid effort.

MS. AMANPOUR: Yes. So that will be what you will agree to if all else fails?

SEN. KYL: That's what the Senate is proceeding with. Now, the House of Representatives has to make its decision about what it will do. But I'm simply answering your question, at the end of the day, I don't think there will be a default.

MS. AMANPOUR: All right. You talk about taxes and, obviously, the Republicans have made that a line in the sand; no new taxes. And yet poll after poll recently have basically said that the American people are not with you on that issue. The majority actually says that there should be a balanced approach, whether it's the Quinnipiac, even including not even a majority of Republicans say there should be no new taxes.

So do you think that you're out of step with the American people on this?

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