'This Week' Transcript: Rep. Paul Ryan and White House Chief of Staff Denis McDonough

PHOTO: ABC News George Will, House Armed Services Committee Member Rep Joaquin Castro (D) Texas, 2012 Republican Presidential Candidate and (R) Former House Speaker Newt Gingrich, Washington Post Columnist Ruth Marcus, and Romney 2012 Campaign Senior Adv

Read here for a full recap of Denis McDonough's and Paul Ryan's interview.

KARL: Good morning and welcome to "This Week." "This Week" exclusive.

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OBAMA: Gabby Giffords deserves a vote. The families of Newtown deserve a vote.

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KARL: After Obama's appeal on guns, immigration, and the minimum wage, how will Republicans respond? We'll ask Congressman Paul Ryan, here live only on "This Week." Plus, how is President Obama going to get any of this out of Congress? White House chief of staff, Denis McDonough is here. Then.

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GRAHAM: The debate time for Senator Hagel is not yet over.

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KARL: Hagel on hold and -- was this really a big deal?

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STEPHEN COLBERT, TALK SHOW HOST: Don't worry, Senator Rubio, nobody noticed that you gave a speech.

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KARL: Our powerhouse roundtable takes on all the week's politics. George Will, Democratic Congressman Joaquin Castro, former speaker of the house, Newt Gingrich, Ruth Marcus from the Washington Post, and former Romney adviser, Stuart Stevens.

KARL: Hello again, George is off today, it's great to have you with us.

In a "This Week" exclusive, Congressman Paul Ryan is standing by to join us live, but first, a major political story breaking overnight. A new report from USA Today with what the paper says is a draft of the White House immigration proposal. According to the report, the plan includes allowing undocumented immigrants to apply for legal status with a pathway to citizenship after eight years. It also expands e-verify and border security.

Joining us now to talk about this is the new White House Chief of Staff Denis McDonough. Thank you for joining us.

MCDONOUGH: Thanks for having me, Jon.

KARL: Now, this hit with a thud as far as Marco Rubio is concerned. He said late last night in a statement, quote, "this legislation is half baked and seriously flawed. It would actually make our immigration problems worse. If actually proposed, the president's bill would be dead on arrival in Congress, leaving us with unsecured borders and a broken legal immigration system for years to come."

Let's be honest. There is no passing an immigration bill without Marco Rubio. How could the White House be working on a draft without Republican input?

MCDONOUGH: Jon, you know, the president has always approached this question of immigration reform from four principles. One, let's make sure that the border is secure. Two, let's make sure that we enforce on businesses who are gaming the system, enforce their requirements to live up to the law. Three, make sure that we are reforming legal immigration so that we can use it to make sure that those who have come here legally have a reasonable option.

And we've not proposed anything to Capitol Hill yet. We've got a bill, we're doing exactly what the president said we would do last month in Las Vegas, which is we're preparing. We're going to be ready. We have developed each of these proposals so we have them in a position so that we can succeed, because fact of the matter is, Jon, as you know as well as I do, going back to 2001, this has been a priority for many Congresses. So let's make sure that they get this thing done. And they're up there working on it right now. Senator Rubio, Senator Durbin, Senator Schumer and others. And let's see how they do, and we'll be ready to work with them.

KARL: But back to my question here, how could the White House be working on a draft -- even if it's a White House draft -- without at least talking to Republicans about it? I mean, has the president even met with Marco Rubio yet on immigration?

MCDONOUGH: Well, we're talking with all the parties to the gang of eight effort in the Senate. Jon --

KARL: He says there's been no consultation.

MCDONOUGH: We've been working with all the members up there. We have our staff working this very aggressively with their staffs and with the members, and we're working this very aggressively, as you think we would with such a high priority for the country.

This immigration system is broken. Border security, we've made great progress for the last four years. We want to build on that. And we're going to continue to work with Senator Rubio and others on this.

But he says it's dead on arrival if it's proposed. Well, let's make sure that it doesn't have to be proposed. Let's make sure that that group up there, the gang of eight, makes good progress on these efforts, as much as they say they want to, and that's exactly what we intend to do, to work with them.

KARL: So what do you say to Marco Rubio on this? I mean, he's saying half-baked, flawed. What do you say to him? How do you do some damage control on this?

MCDONOUGH: Well, I am not going to get engaged in that kind of a back and forth as is often the practice here in Washington, a big kind of political scrum, even before we've had actual proposal of--

KARL: It's already here. He started it. Right, I mean--

MCDONOUGH: Well, look, I'm not going to engage, as I said, in some kind of back and forth. What I am going to do is make sure that our team is doing exactly what the president has demanded us to do, and what he said to the country in the State of the Union the other night, which is we have to make progress on immigration reform. We should enact this this year, and the president will continue to work with the team to make sure that happens.

KARL: OK, I want to move to the other big battle you have coming up right now with Congress. The so-called sequester, these automatic spending cuts. We've heard some dire warnings about what they would mean. We've heard 70,000 kids kicked off Head Start, the equivalent of 1,000 FBI agents off the job, the Navy shutting down four air wings, delaying the deployment of a carrier striker to the Persian Gulf, and we've even had a senator talk about five-hour wait times at airports if these cuts go into effect.

So tell me straight with me, how bad will it be if it happens?

MCDONOUGH: Well, you didn't even raise the thing that concerns the president most about the sequester, which is we've seen pretty good economic activity over the course of the last several months. The housing market is healing. The stock market is coming back. You've seen consumer confidence restored. So the lens through which the president looks at this fight, Jon, is a lens that says, are we doing everything we can in this country to strengthen middle class families? That's how our country, our economy is strongest, when a thriving, rising middle class is the engine for growth in this economy. That's exactly what we want to do.

When you look at sequester, the impacts on middle class families, what's it going to be? Teachers in schools, 13,000 schools are going to be-- 13,000 teachers are going to be hit, 6,000 schools. If you look at mental health, if you look at food inspections -- and you've already heard the devastating list of horribles that the Pentagon has said are going to be out there.

So the question is, on top of all those things that you just talked about is what is the impact on the middle class? So the question the president is asking is why don't we take a step back, let's fix this in a kind of balanced way the president has proposed and the Senate Democrats have proposed, with a reasonable amount of spending cuts and a reasonable amount of revenue raisers so that we can get this thing done and move on to the business of the country.

KARL: But help me understand, because we have a budget. This is -- let's look at exactly what this is. $85 billion this year out of a budget of $3.8 trillion. You can see just the small slice, and then if you look at the sequester over 10 years, we're talking about 1.2 trillion out of $47 trillion in projected government spending. Is it really impossible to find less than 3 percent of savings in a federal budget without making those kind of horrible cuts?

MCDONOUGH: You know what, it's not impossible, and that is exactly what the president has done over the last year, $2.5 trillion in deficit reduction. He's ready to do another $1.5 trillion to get up to the $4 trillion target that economists across the country tell us is needed to stabilize the debt over the next 10 years. So that's exactly what the president has done, working with Democrats and Republicans.

KARL: But you're going to insist on tax increases, right?

MCDONOUGH: Well, we're going to insist on doing this in a balanced way--

KARL: Which means tax increases.

MCDONOUGH: A way that -- we're going to insist on doing this in a balanced way. A way that allows us to maintain the kinds of investments that middle-class families in this country rely on, Jon.

We were just talking about our families, our kids. You know what, we're not going to put at risk the education investments in this country because we can't get together to resolve this in a balanced way. This is not an ideological effort, Jon. This should not be a social science experiment. This should be a question where we ask ourselves, what is most important to the economy, what is most important to the middle class families of this country, and that's the way the president is going to do this.

KARL: OK, we're almost out of time. Very quickly, two other things.

MCDONOUGH: Yes.

KARL: Chuck Hagel, the nomination delayed, also CIA director, your nominee, John Brennan, looks like he'll be delayed. Is this a threat to national security?

MCDONOUGH: It's a grave concern. If you look at Chuck Hagel, decorated war veteran himself, war hero. Republican senator. Somebody who over the course of the last many years, either as a Republican senator or as the chairman of the president's Intelligence Advisory Board, I've worked with very closely. This guy has one thing in mind, how do we protect the country.

KARL: Is there a danger of this being delayed?

MCDONOUGH: Between John Brennan, CIA director, and Chuck Hagel as second of defense, we want to make sure that we have our -- those guys sitting in the chairs working, because I don't want there to have been something missed because of this hangup here in Washington.

KARL: OK, and very quickly, John Boehner had a very -- seemed like a harsh comment directed toward the president, saying that quote, "I don't think he has the guts to cut or to deal with the entitlement problem. He don't have the courage to take on the liberal side of his own party." What do you say to the speaker of the House, John Boehner?

MCDONOUGH: In the State of the Union address on Tuesday night, the president laid out a very detailed plan to get to the $4 trillion in deficit reduction that we need to stabilize debt, grow the economy, strengthen the middle class. That's exactly what he's done. That takes on his party, and asks (ph) the Republicans to do a little bit too. And that's what we're going to continue to do.

KARL: All right. Denis McDonough, brand-new White House chief of staff. Thank you for coming here on "This Week."

MCDONOUGH: Thanks so much for having me, Jon.

KARL: And now, in a "This Week" exclusive, Congressman Paul Ryan joins us from Janesville, Wisconsin. Congressman Ryan, thanks for coming to the show.

RYAN: Hey, good morning, Jonathan.

KARL: I want to get right to this dustup over immigration and Marco Rubio's comments. Just last week, you said that the president deserved credit for not politicizing the immigration issue. You thought that was a good sign. Do you still believe that?

RYAN: Actually, I don't, and I really don't enjoy saying this. I did think that his words were measured and productive in the State of the Union. But putting this -- leaking this out does set things in the wrong direction.

Look, the question that we always have to ask ourselves, particularly with this White House, is the president looking for a partisan advantage or is he looking for a bipartisan law? And by putting these details out without a guest worker program, without addressing future flow, by giving advantage to those who cut in front of line for immigrants who came here legally, not dealing with border security adequately, that tells us that he's looking for a partisan advantage and not a bipartisan solution.

There are groups in the House and the Senate working together to get this done and when he does things like this, it makes that much more difficult to do that. And that's why I think this particular move, very counterproductive.

KARL: Well, let's be clear. You have said that you would support an immigration bill that included a pathway for citizenship, correct?

RYAN: Yes, look, absolutely because we think that's -- there's a way to do this through earned legalization without rewarding people for having come in with undocumented status, illegally. We don't want to give them an advantage over those who came here legally and we think there's a way to do this while still respecting the rule of law. It's clear that what the president is talking about does not do that.

I have a long record of immigration reform. I'm not a Johnny-come-lately on this issue. We've always believed that there is a way of doing this while respecting the rule of law, that's the delicate balance that needs to be achieved for this to be bipartisan and the president on most of these issues and this one now, like the others, seems to be looking for a partisan advantage and not bringing the parties together.

KARL: Well, let's get to the biggest other issue out there right now which is these automatic spending cuts. You've been pretty clear. You've predicted for some time that you think that this so-called sequester is going to happen.

Let me ask you this, congress is now on recess for ten days, the president is playing golf in Florida this weekend. Is there really any everyday underway to try to avert these cuts right now? Are you even trying.

RYAN: Well, there have been from the House Republicans.

Let's take a step back. Don't forget it's the president that proposed the sequester and designed sequester and House Republicans who twice passed legislation replacing the sequester with smarter cuts in other areas of government.

KARL: OK.

RYAN: The Senate hasn't passed a bill to replace the sequester. The president gave a speech showing that he'd like to replace it, but he hasn't put any details out there. So that is why I conclude I believe it's going to take place.

But take a step back. We are here because the president back in the last session of congress refused to cut spending in any place and therefore we wound up with the sequester.

KARL: But Congressman, I've heard you say this and a talking point for Republicans for a long time. This was the president's idea on and on and on, but let's look at your own words. What you said right after the law putting this in place was passed in August of 2011. These are your words. You said "what conservatives like me have been fighting for, for years are statutory caps on spending, literally legal caps in law that says government agencies cannot spend over a set amount of money and if they breach that amount across the board sequester comes in to cut that spending. You can't turn it out without a supermajority. We got that into law."

Now it sounds to me there like if you weren't taking credit for the idea of the sequester, you were certainly suggesting it was a good idea.

RYAN: So those are the budget caps on discretionary spending. Those occurred. We want those. Everybody wants budget caps. The sequester we're talking about now was backing up the super committee. Remember the super committee in addition to those caps was supposed to come up with $1.2 trillion in savings. The Republicans on the super committee offered even higher revenues in exchange for spending cuts as part of that. It was rejected by the president and the Democrats. So no resolution occurred and therefore the sequester is occurring. And what we've always said is let's cut spending in smarter ways to replace this sequester. We passed two bills doing that and we've heard nothing in response from the Senate Democrats or the president.

KARL: Now...

RYAN: We didn't pass anything.

And the point I'm trying to say is, when you have no budget passing the Senate for four years, when the president is going to be about a month late in proposing his budget, there's no leadership on the other side of the aisle and therefore no agreement.

KARL: Now, wait a minute. Two points, first of all, actually House Republicans have not acted in this congress. You know, you did in the last congress those bills are dead.

RYAN: No, in this congress...

KARL: So why haven't you even tried to pass...

RYAN: In December we passed it again, that's right.

KARL: OK. So now we have...

RYAN: Please say that again.

KARL: Well, now we have the Senate Democrats on Friday did come out with a plan to replace these cuts. It's half spending cuts and half tax revenue increases. What do you make of that Democratic plan?

RYAN: Well, first of all I'd be curious to see if they could actually pass that, number one. Number two, the president got his tax increases last year. He got those higher revenues. He was able to tax higher income individuals. But taking tax loophole, what we've always advocated is necessary for tax reform, means you're going to close loopholes to fuel more spending not to reform the tax code.

What is the goal that we're trying to achieve here? We want economic growth. We want job creation. We want people to go back to work. We want to prevent a debt crisis from hurting those who are the most vulnerable in society from giving us a European-like economy.

In order to do that, you've got to get the debt and deficit under control and you've got to grow the economy. So if you take tax loopholes to fuel more spending, which is what they're proposing, then you are preventing tax reform, which we think is necessary, to end crony capitalism and to grow the economy.

KARL: So very quickly, though, you're body...

RYAN: So that's why we think we need to cut spending to pay for this.

KARL: But your bottom line.

RYAN: Yes, our bottom line is cut spending to pay for this, that's right.

KARL: And you're saying no tax increases, period, to pay for this.

RYAN: That is a right, that's right because revenues, loopholes are necessary for tax reform. If you take them for spending, you're blocking tax reform and you're really not getting the deficit under control.

KARL: OK, now, the next big thing here is you -- the speaker has said you were going to come out with a balanced budget that's going to balance the budget in ten years. Your last budget didn't balance until well after 2030. So this is a wig, new step.

Some in your own party are a little worried about this. Mike Simpson, Republican congressman from Idaho said "we are saying a ten-year balance. That's tougher than the last Ryan budget. There could be a significant number of Republicans that say, I'm not going there because it would be too dramatic."

How are you going to balance the budget in ten years? What further things are you going to cut that you didn't last time?

RYAN: Well, we'll show you when we finish writing the budget. We haven't literally finished writing it. We've just begun because we just now got our baseline. So I can't answer the question since it's not a complete task. But I'm very comfortable with the fact that we will pass this. I'm very comfortable with the fact that we will produce a budget that balances.

Our last budget balanced. It just balanced a little later. This one will balance on time because we have new numbers to work with from the Congressional Budget Office that I think will make it easier for us to balance.

And, look, the point also is this, we're producing a budget. We're going to be passing a budget. The Senate hasn't passed a budget for four years. The president has never proposed ever to ever balance the budget. That's wrong. The reason we want to do this is not simply to make numbers ad up, we want to prevent a debt crisis, we want to grow the economy, we want to get people back to work in society and if we have a debt crisis, that is bad for our economy today.

KARL: OK.

RYAN: And let's never forget we're robbing from future generations. We've got to address that.

KARL: We're almost out of time. I've got to ask you about this new effort from Karl Rove to weed out what he's calling problem candidates and Republican primaries.

One conservative talk radio host said of this effort "we are now at the point where you are almost better off in the Republican Party being endorsed by Barack Obama than Karl Rove. He is the reverse Midas."

Now I might note, by the way, that Karl Rove has recently called you one of the most remarkable political talents in America. But putting that aside, do you think this is a good thing or a bad thing to have a, you know, big Washington power broker trying to get in there and meddle in Republican primaries?

RYAN: You know what, Jonathan, I don't even pay attention to this stuff. I'm too busy trying to do my job. I'm too busy rising to put a budget together a budget that balances, to grow the economy, to create opportunity, to get bipartisan immigration reform. I really don't pay attention to this. So I have no thoughts on the matter whatsoever.

KARL: No thoughts whatsoever.

OK, before you go you know I have to ask you about your future. There was an article in Politico by my friends Mike Allen and Jim Vandehei about your political future saying you are less inclined to run for president. And this quote caught my eye "Paul will never say he's not running for president because the constant speculation carries too many advantages, said a longtime friend. He will keep answering the questions in a way that will keep nosy political reporters interested.:"

Now, congressman at risk of being a nosy political reporter here, is it true, are you considerably less likely now to run for president in 2016?

RYAN: Actually, Jonathan, you've known me a long time and the one thing you know about me is I don't play that game. I don't talk like that. So when you see these articles that are really not accurate, that's par for the course in Washington these days.

The point is this, I think the most important thing for me to do is do my job representing the first district of Wisconsin, trying to prevent a debt crisis, helping get a solution to the economy, to jobs, to getting our deficit and debt under control.

That it me is my first priority. That's what I'm focused on. Will I or won't I? I don't know. I literally do not know the answer to these questions about what is the best role for me to play to fix these problems for our country in the future.

The point is I don't know the answer because I'm just not putting a great deal of thought into it. I'm not foreclosing any opportunity. I may or a I may not. I just don't know because right now we just had an election. We've got jobs to do.

What bothers me is this permanent campaign the president has us in. We need to start thinking about doing our jobs after these elections than thinking about the next election.

KARL: All right.

RYAN: That's the problem we have in Washington.

KARL: Unfortunately we're out of time but I'm going to take that as a definite maybe. Thank you very much, Congressman Paul Ryan.

RYAN: All right.

KARL: Appreciate your time.

RYAN: Coming up our powerhouse roundtable weighs in on gun, immigration and those budget battle. Plus we'll take on the Marco Rubio sip slip. And then in our Sunday spotlight, the brain surgeon "The Wall Street Journal" is pushing to run for president, Dr. Ben Carson is here.

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MITT ROMNEY, FRM. PRESIDENTIAL CANDIDATE: I will not cut our military budget by a trillion dollars which is the combination of the budget cuts the president has as well as the sequestration cuts. That in my view is making our future less certain and less secure.

OBAMA: Bob, I just need to comment on this.

First of all, the sequester is not something that I proposed, it's something that congress has proposed. It will not happen.

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KARL: Back with the roundtable: George Will, Ruth Marcus from The Washington Post, former Romney senior adviser Stuart Stevens, former speaker of the house Newt Gingrich and Democratic congressman Joaquin Castro. Thank you all for joining us.

George, the bottom line, these sequester cuts obviously are going to happen. And then we're going to have a battle over the government shutdown, debt ceiling. Where does this all end?

GEORGE WILL, ABC NEWS: It doesn't end. This is Democratic politics in an age where we have made promises we can't keep and there are intractable budget ceilings that we have to bump up again. Let me give you two examples this week, the Navy citing the sequester, delayed the deployment of the aircraft carrier Truman undermining our pledge to have two carrier groups in the Persian Gulf to keep pressure on Iran, citing the sequester.

You telling me the Navy can't find other ways to economize without this flamboyant and provocative way of trying to pressure congress?

Second, this week we learned the Agriculture Department has a diversity awareness program, doesn't cost much money, in which they teach the bureaucrats in the agriculture department to refer to the pilgrims as illegal aliens and minorities as emerging majorities. It's a small amount of money but a huge symptom of the utter contempt with which Washington treats taxpayers' money.

Two good reasons right there to go ahead with the sequester.

KARL: Mr. Speaker, are these being exaggerated, these -- the doom and gloom?

NEWT GINGRICH, FRM. SPEAKER OF THE HOUSE: Grossly, of course. Look, this is a government so bloated, so wasteful and so incompetent that actually this is equivalent of a recession and recessions, you know, Jack Welsh made the point the other day, any corporation that couldn't cut 2.3 percent of its gross spending would get rid of its CEO.

Now this is not an Obama comment, this a Congress plus Obama comment.

The Pentagon needs a thorough overhaul. I helped found the military reform caucus in in '81. I'm a hawk, but I'm a cheap hawk.

You look cut the F-35 overrun problem, it is obscene and disgraceful. And people should be demanding that we fix the system.

One other example -- one other example, we just learned that one of the great solar powered green energy projects was $140 million for a company in Michigan which has produced zero products, zero for $140 million. Why shouldn't the American people say cut out the waste?

KARL: Congressman.

REP. JOAQUIN CASTRO, (D) TEXAS: And Jonathan, the fact is that the president and the Democrats believe we can make cuts and reduce the debt but it's got to be balanced. So I think we all agree on where we need to end up. It's a matter of how you get there.

And just to counter a little bit about what George said, the fact is this was never the president's idea, this was the result of hostage politics engaged in by a Tea Party-controlled Republican Party and this is what you have. This is the message you have when you get into those kind of hostage politics.

KARL: Ruth, does it matter whose idea it was?

RUTH MARCUS, WASHINGTON POST: It doesn't matter whose idea it was, what matters is the unthinkable is now inevitable. I'm going to give you my modest proposal for the sequester, which is we should take the relevant members of congress and the administration, put them on that stinky cruise ship and send them back out there.

But I want to say the notion that there's going to be various government waste, more waste to cut. The absolutely worst way to cut it in the across-the-board unthinking mechanism of the sequester. And second, the impact of the sequester is bigger than it would appear if you just take it as a percentage of the budget as a whole because...

KARL: Because they're not touching entitlements.

MARCUS: It doesn't touch most entitlements. So it hits two things very hard. It hits domestic spending which is already shrunken as the size of the economy to the levels of the Eisenhower administration and it hits defense spending effectively because you're cramming it all into seven months, 9 percent of domestic spending, 13 percent cut in Defense spending. That's not smart government.

KARL: And, Stuart, that's a big hit on the Pentagon. I mean, we all know there's some waste over there, but a big hit immediately.

STUART STEVENS, FRM. MITT ROMNEY ADVISER: Yeah, but Jonathan, you opened the show correctly with the most powerful person in the world saying it wasn't going to happen. I can't believe, given his extraordinary communication powers, that he can't get people together, talk to the country and solve this problem. It doesn't look like he's really trying very hard. I mean, it's just not the top item on his agenda. And he's made that clear.

KARL: So you're endorsing the cruise ship idea?

STEVENS: I like the cruise ship idea particularly if they can maybe come close to being hit by a meteorite, because then it would be...

KARL: You could bring it all together.

STEVENS: It would be just a huge cable bonanza.

But this is a test of leadership. I mean, this is why we have in our system a president. He's a leader. He's got to lead us through this crisis. And it's just not happening.

KARL: All right, we have to take a very quick break. We'll have lots more roundtable ahead. We take on those breaking developments on immigration reform plus Chuck Hagel, what the latest delay means for his chances. And the president's push on guns. That's next.

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KARL: More roundtable straight ahead but first, "The Sunday Funnies."

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JIMMY KIMMEL, LATE NIGHT WITH JIMMY KIMMEL: President Obama made his fifth State of the Union Address tonight in Washington, D.C. He spoke in front of congress. His focus was on jobs and the economy. He has an interesting plan to grow the economy and he laid it out. This is it. Cash for gold. It's -- look how cool that duck is, how could you go wrong?

UNIDENTIFIED MALE: Did you see this photo yesterday? Lightning struck St. Peter's Basilica just hours after the Pope Benedict announced his resignation. Yes. Then the pope said I guess that's a no on getting paid for unused vacation days.

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DAVID LETTERMAN, CBS HOST: Top 10 things going through Marco Rubio's mind. Number 10, smooth.

JIMMY KIMMEL, ABC HOST: It would have been less awkward had he been wearing one of these on his head during the speech.

LETTERMAN: Oh, my God, I asked for sparkling water.

GEORGE STEPHANOPOULOS, ABC HOST: You tweeted out the water bottle yourself. You've gotten there again. You know the thing -- you've shown the ability to laugh at yourself.

Do you have anything to add to that tweet from last night?

SEN. MARCO RUBIO (R), FLA.: No, I mean, I needed water. What am I going to do? You know, it happens.

(END VIDEO CLIP)

KARL: All right. Back again with the roundtable. We'll get to the Watergate in a second but the serious news with Marco Rubio was this White House immigration plan that leaked overnight and his, you know, pretty strong attack against it.

I've got to ask you, Congressman Castro, even your Democratic colleague from Texas, Congressman Cuellar, said that it would be better if the president would let Congress take the lead on this.

Is the White House botching the effort to get a bipartisan deal here?

CASTRO: Well, remember, this was leaked, so it's not something that the White House rolled out and it's also -- it's also clear that it's incomplete. So I think, no, I think, look, it's important that every branch of government, the executive and the legislative branch both work on this.

And I also think there's a silver lining in this, which is that there are a lot of commonalities between the two plans, including a path to citizenship, so there's a lot to work with there.

KARL: But let me ask you what I asked Denis McDonough, which why haven't then even talked to Rubio about this?

CASTRO: Well, I mean --

KARL: The only people that have gone down to the White House -- it's all Democrats.

CASTRO: Sure, and I think because all of that is still in the process. It hasn't happened yet. It will happen before something is acted upon and certainly before something is passed.

KARL: Stuart?

STUART STEVENS, ROMNEY 2012 CAMPAIGN SR. ADVISER: Well, I hope that they speak to the senator about it because, to have success here, you have to have a plan that passes and that has not only the votes to get it but has the consensus of support among the people.

And that's the great, the great missing element here, is a consensus of what needs to be done. And you have a moment here that's been created. It's a tremendous opportunity for the president to show leadership here. You have a senator in Marco Rubio, who is showing, I think, true courage here in trying to solve a problem. They should go forward and not just stall here.

KARL: And, George, I have to say the White House seems genuinely irritated that this leaked, as I could imagine.

GEORGE WILL, ABC NEWS CORRESPONDENT: Yes, I can imagine. Look, there's a great consensus on the two really contentious issues that have bedeviled us for a generation.

First, the 11 million people who are here are not going to be deported and are not going to self-deport. The American people would not tolerate the police measures necessary to extract from our community these people, a majority of whom have been here five, six, seven, eight or more years.

Second, we need immigrants. We need them for seasonal labor. We need them for construction industries. There are all kinds of industries dependent on this. So we have the consensus on this.

The problem is not stopping the flood from Mexico. It stopped two years ago. The Mexican economy, furthermore, is doing better than ours is, and as it grows it's going to solve the immigration problem largely that way.

KARL: More than any fence can.

WILL: More than any fence can, exactly.

KARL: So you brought up a phrase, self-deport. I want to flash back here, since we've got a little bit of a Republican primary reunion, to that moment in the Republican primary when Mitt Romney brought this issue up.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: So if you don't deport them, how do you send them home

MITT ROMNEY, FORMER GOVERNOR OF MASSACHUSETTS: Well, the answer is self-deportation, which is people decide that they can do better by going home because they can't find work here because they don't have legal documentation to allow them to work here. And so we're not going to round people up.

(END VIDEO CLIP)

KARL: OK, Speaker Gingrich, how much damage did Mitt Romney do, not just to his own election prospects there, but to the Republican brand with how he handled that issue?

NEWT GINGRICH, FORMER SPEAKER OF THE HOUSE: Oh, I think that and the 47 percent comment were fatal. If you look at the polling data from Univision and others, the minute he got into self-deportation, both Asian-Americans and Latino-Americans said, don't talk to me about jobs. You're going to deport me? You expect that my grandmother is going to go home? I mean, don't talk to me.

And you couldn't break through. And the -- look at the last ad that the Obama campaign ran in Spanish for the last few weeks of the campaign; it was just Mitt Romney.

RUTH MARCUS, COLUMNIST, "THE WASHINGTON POST": And, John, I think the Republican Party understands that and that's why I think there is going to be immigration reform. The president wants it. It's really his top legislative priority.

The Republican Party wants it for the reason that it would like to retain -- regain the presidency at some point.

But Congressman Ryan, in his interview with you, used the phrase "delicate balance." And there were two delicate balances here. The first is the balance of whether the degree to which the president inserts himself into the process, the legislative process, or whether he holds back.

For the White House there's a little bit of a rerun of health care here, where they held back too long and let --

(CROSSTALK)

KARL: Then it was --

MARCUS: -- the process slip away. But they've been urged to stay out a little bit. So you have that back and forth.

The other delicate balance is the degree to which the Republican Party can bring itself to do what it knows it needs to do in terms of comprehensive immigration reform.

And so I think the unhappiness that Senator Rubio expressed also reflected the delicate nature of how far Republicans can go in creating that pathway to citizenship.

(CROSSTALK)

KARL: And Stuart --

STEVENS: Let me say something, Republican Party had a problem with Hispanic voters before this primary. I don't think it got better during the primary certainly. And I think that --

KARL: I mean, it got worse.

STEVENS: That's regrettable. But if you look at the numbers, it didn't get significantly worse.

The greatest appeal that the Obama campaign had for Hispanic voters turned out to be ObamaCare. And they ran a tremendous amount of their advertising appealing to Hispanic voters. It was the only place in their advertising where they talked about ObamaCare, was into -- in it -- to the Hispanic community, because an extraordinary percentage of Hispanic voters are uninsured.

And that was smart politics. They did it well. The party was also known as the party that was against ObamaCare and that hurt us.

There's not one solution here for the problems that Republicans have with Hispanic voters and I think --

(CROSSTALK)

KARL: -- immigration suddenly solves it.

STEVENS: And I hope and pray we can get through this stage and we can come to some sort of consensus here and go forward.

KARL: George, immigration is a big part of this. And were you struck by how kind of over-the-top Marco Rubio's response was to this? I mean it was a draft. It wasn't -- the White House wasn't putting it out and he, you know, came out blazing on this.

WILL: Yes, I'd like to see the details of what he finds in it that is offensive or left out that is important to add to it. In that sense, it strikes me as this may tell us something about the many pressures, conflicting pressures on Marco Rubio.

He's been on the cover of "Time" magazine, anointed the savior of the Republican Party. That's a big lot of pressure. And he -- I'm sure he's heard from members of the Republican Party, some of whom do not want to be saved with the kind of immigration reform he has in mind.

CASTRO: Jonathan -- and I would point out I think that's right. I think his response was very eager. I think within 30 minutes after "USA Today" broke that story, they had put something out. I think it would be better to be constructive, to actually get with the White House, get with the Democratic folks in Congress and figure out what we can do to work together on this.

GINGRICH: But -- go ahead. (Inaudible).

CASTRO: And I would also say that, as far as immigration goes, I think health care education, other issues for the Latino community, are very important, just like all Americans. But they do use, I think, that immigration issue to sort out who the good guys and bad guys are in politics.

So it's not just tone, but it's also the policies that were passed in Arizona, in Alabama, in Georgia, and those aren't going away for awhile.

GINGRICH: But I think there's a very important part of this that the Obama administration probably can't bring itself to deal with. An Obama immigration plan is not going to pass the House.

KARL: He needs a Rubio-Obama plan.

GINGRICH: I'm just saying, that you start from a -- just from a Bush Social Security plan after '04 was dead because it was the Bush Social Security plan. So if you want to actually get legislation --

(CROSSTALK)

KARL: Will a Rubio immigration plan pass the House?

GINGRICH: No, but I think a Rubio -- and -- the House Republicans and House Democrats have been meeting on immigration. I mean I think there will be a House immigration bill that has a very substantial support that Boehner and Cantor and others will be supporting. And I think that negotiated with a Senate immigration bill that has to have bipartisan support could actually get to the president's desk. But an Obama plan led and driven by Obama in this atmosphere with the level of hostility towards the president and the way he goads the hostility I think is very hard to imagine that bill -- that his bill is going to pass the House.

MARCUS: Well, Newt brings up actually the really interesting leadership conundrum of Obama. Because on the one hand, you have Republicans at times demanding that the president lead and demanding the president's plan, then you have the reality on the ground that when the president does lead, the answer is, no way.

KARL: It becomes radioactive.

MARCUS: And so -- go ahead.

STEVENS: That has become a litmus test of the president. Is this about politics or is it about passing a bill, because you have in Senator Rubio someone who really is doing something here extraordinary, trying to to and he could be a partner in this process to help get it through.

MARCUS: But one thing, Stu, is the president...

STEVENS: And you're going to use that person and try to help and work with him and lower the temperature to all of this and not be leaking plans and not be calling bluffs and try to get something done. You could get -- this is a moment.

MARCUS: Well, we don't know who leaked. And the question -- I'm a big believer in working together and I'm a big believer in reaching out. I also think Newt is exactly right if you reach out too publicly, if you embrace too much you're going to doom your plan. And so it's very complicated and especially because of the cross pressures on Rubio and the Republican Party that George mentioned.

WILL: If the president wants any substantial legislative achievement in the next four years and every hour that passes his power begins to leach away it's got to be this. Go back to -- it's as distant as the Peloponnesian Wars now, but go back to Tuesday night's speech, he says he's going to redesign our high schools. No he isn't. He says he's going to have manufacturing hubs, which is a recipe for dozens, scores of Solyndras along the way and more crony capitalism. He says we're going to double down on Head Start. We have 47 years of experience with Head Start and know that all the good has dissipated by the third grade. None of that is going to happen. This could happen.

KARL: So, this is -- the stakes are extremely high for the Republicans here, not just the president in terms of a legislative achievement. We have as much talked about Republican reboot. I want to take a look at "The New York Times" magazine has a cover story today on the Republicans and their problem with technology. And Stuart, this quote caught my eye "Romney's senior strategist Stuart Stevens, may well be remembered by historians as the last guy to run a presidential campaign who never tweeted."

STEVENS: Really made -- if I had tweeted in this campaign this whole discussion we've been having about the second amendment would probably be replaced one about the first amendment and whether it should apply to tweeting.

Listen, I don't think -- it would be a great mistake if we felt that technology in itself is going to save the Republican Party. Technology is something to a large degree you can go out and purchase and if we think there's an off the shelf solution that you can go out and purchase for the Republican Party it's wrong.

You know, we've had a lot of chance now since the campaign to spend time with the Obama folks and sometimes they had better technology, some cases we have better technology. We don't have 140 character problem in the Republican Party. We have a larger problem that we have to look at and be patient about it. And trying to think that there's one solution like this, I just don't think...

KARL: Are we ever going to get you on Twitter, though?

STEVENS: We can discuss that.

KARL: So you disagree with this. You think there's a big technology...

GINGRICH: I think the way Stuart just said it is exactly right. The technology problem is a culture problem. I mean the Democrats had 54 data analysts and were hiring Ph.Ds in advanced math because they were using the most advanced decision processes in the country. They were bringing in behavioral scientists. They were trying to figure out how you talk to 311 million people and do so in a way that you can survive 8 percent unemployment and get re-elected and it worked.

Now, I think it's actually -- he's right in a sense it's a cultural problem. None of our consultants would have imagined hiring 54 people in the decision area, none of them would have imagined having 24 people did nothing full time except e-mails and then blind tested the best e-mails to see which ones worked. I mean, this -- they are a Super Bowl team that we ought to respect deeply. And we are currently a midlevel college team floundering around and I agree. It's not just -- you can't just go out and buy this, this is a fundamental rethinking of how you relate to the American people.

And, frankly, most of them -- I'm embarrassed to say I thought election day we'd win. I couldn't imagine this economy and Obama getting re-elected and that made me think if your airplane hits the mountain maybe you better buy new radar.

KARL: Yeah, yeah, you definitely have a radar issue there.

Very quickly, because I want to move on...

MARCUS: The Republican Party's technology problem is a little like its immigration problem. It's necessary but not sufficient for it to get up to speed on those things. It won't help it win. I think about the Republican Party like the old joke how many therapists does it take to change a light bulb. The light bulb has to change. The Republican Party has to decide it wants to change.

KARL: So I want to move on to this dust-up over Chuck Hagel. And, George, the Republicans delayed this. I don't understand what's going on in the Senate, because a lot who voted against having the vote said, no, no, I'll let it happen in two weeks. Are the Republicans playing a dangerous game here by blocking Hagel and Brennan, Defense and CIA, when they know that both of them are ultimately going to be confirmed?

WILL: Because they do know that, and because most sensible Republicans believe that a president is owed vast deference in picking his cabinet because the cabinet leaves when he leaves and the cabinet exists to implement his policies, neither is true of judicial appointments, for example.

Now, Chuck Hagel took that principle and made it really hard to subscribe to with this appalling performance in his hearing. Nevertheless, if the president wants a terrible Secretary of Defense, he's got a right to him. And I think he'll get him.

KARL: There's an endorsement.

So, why are the Republicans playing this game?

GINGRICH: Well, there's a secondary part of this, which I think George would subscribe to. The Constitution divides power. This is one of the first occasions where you see the Republicans in the Senate get together and say, you know, we want to remind the executive branch that you have to have some deference to us. I mean, Lindsey Graham's point is tell us the rest of the Benghazi story. Other folks would like to know more about where did Hagel's money came from.

I don't find it unseemly to say to a potential Secretary of Defense or Secretary of Treasury, tell me what you've been doing, where you're money has come from while you've been out of public office.

CASTRO: OK, but so, Jonathan, let me point out also you had a North Korea doing its nuclear test, we've got a drawdown on Afghanistan, all of these very significant issues and Chuck Hagel is being asked about sneaking fees that he may have received three or four or five years ago.

KARL: May or may not have received.

And I want to tell you the one guy more than any other that blocked this is the new Senator Ted Cruz. He's barely been in office a little over a month. And listen to this exchange he had with John McCain.

(BEGIN VIDEO CLIP)

SEN. TED CRUZ, (R) TEXAS: It is at a minimum relevant to know if that $200,000 that he deposited in his bank account came directly from Saudi Arabia, came directly from North Korea.

SEN. JOHN MCCAIN, (R) ARIZONA: Senator Hagel is an honorable man. He has served his country and no one on this committee at any time should impugn his character or his integrity.

(END VIDEO CLIP)

KARL: Now, Cruz went on to say I don't have any evidence that moneys come from North Korea, but I mean, this is a fellow member of the Texas delegation.

CASTRO: Sure. And I met Ted. And he's always been nice to me. But that was quite frankly shameful to suggest that somebody that was a decorated veteran in Vietnam, who was wounded and hurt for his country was not loyal to his country I think really is quite harsh and had no place there.

MARCUS: He's not running for senator congeniality. And doesn't much care.

There was no predicate for suggesting that that money came from North Korea or any other scary, horrible country and as the former solicitor general of Texas, he ought to know better than that.

If you look at this Cruz story more -- the Hagel story more broadly, if Washington wanted to come up with a way to look worse, I can't imagine one. You know, first of all, I'm with George. The president is entitled to his nominee but his performance, I was going to go with execrable, but I'll settle for appalling. It was an appalling performance.

And now the Republicans just want to make themselves look even for obstructionist with a country frustrated with that? I mean, come on. Confirm the guy -- don't like him, but vote against him.

GINGRICH: This is just such Washington nonsense. You look at what Democrats did to Clarence Thomas. You look at what Democrats did to Judge Bork, you look at the three months that John Tower was hung out to dry by the Senate this is...

KARL: Well, you're not endorsing that behavior, though.

GINGRICH: No, but I'm saying to in this brand-new standard no matter how stupid Chuck Hagel is, no matter how bad his performance, no matter how much he keeps in secret, we all know he is an honorable man. How do we know that?

KARL: All right. Well, we are unfortunately out of time. This was a great roundtable. Thank you very much for joining us.

Congressman Castro, Newt Gingrich, Stuart Stevens, Ruth Marcus, and George Will, really appreciate your time.

Up next, in a presidential run in store for this brain surgeon? The Wall Street Journal hopes so. Our Sunday spotlight is next.

Plus, who stole the spotlight at the White House this week? We'll be right back.

(COMMERCIAL BREAK)

KARL: Now time for our Sunday spotlight. This week shining brightly on Dr. Ben Carson, one of the top pediatric neurosurgeons in the country who made quite a splash with his recent appearance at the National Prayer Breakfast, where, with President Obama at his side, he had some choice words on political correctness and even the flat tax. Listen.

(BEGIN VIDEO CLIP)

DR. BEN CARSON: We've reached a point where people are afraid to actually talk about what they want to say, because somebody might be offended.

What about our taxation system? When I pick up my Bible, you know what I see? I see the fairest individual in the universe, God, and he's given us a system. It's called tithe. Now, we don't necessarily have to do a 10 percent, but it's principle.

(END VIDEO CLIP)

KARL: We're seeing the Wall Street Journal had a lead editorial saying Ben Carson for president. Thank you for joining us.

CARSON: Well, thank you for having me.

KARL: Typically prayer breakfast speeches don't get this kind of attention. You got more than 2 million views on Youtube of this speech. What do you make of this reaction?

CARSON: Well, I make of it the fact that before I gave that talk, I prayed and asked God to give me wisdom what to say. What would resonate, what would be important. And, you know, I don't think it was a particularly political --

KARL: Some people do.

CARSON: I know they do, but to be able to express an opinion about something that is problematic -- you know, I'm a physician. I like to diagnose things, and, you know, I've diagnosed some pretty, pretty significant issues that I think a lot of people resonate with. And, you know, I've just been kind of overwhelmed by the response, particularly a lot of older Americans, who say they had given up on America. And, you know, what we really need is to be able to tone down all the rhetoric and be able to discuss things in a reasonable and rational way and come to conclusions, rather than one side or the other side winning. If we can do that, I think there's real power in that.

KARL: In your book, which came out more than a year ago, it was down quite a ways on Amazon. Now it's No. 3 on the Amazon best-seller list, but I've got to tell you, I have never heard of somebody talking about the flat tax at a prayer breakfast. That was a pretty interesting --

CARSON: Well, you know, I preferred to talk -- to refer to it as the proportional tax, because, of course, it comes from the concept of tithing, you know. If you make a gazillion dollars, you pay a gazillion dollars. If you make very little, you pay very little, but everybody contributes.

KARL: What do you make of President Obama as a leader?

CARSON: I think he's a very talented politician.

KARL: That sounds like faint praise. You obviously disagree with him, that was clear in your--

CARSON: There are a number of policies that I don't believe lead to the growth of our nation and don't lead to the elevation of our nation. And, you know, what I would like to do -- I don't want to sit here and say all his policies are bad, but what I would like to see more often in this nation is an open and intelligent conversation. Not people just casting aspersions at each other. I mean, it's unbelievable to me the way people act like third graders, and if somebody doesn't agree with them, they're this and they're that. And, you know, and it comes from both sides and it's so infantile. And I don't know how we're ever going to make any progress.

KARL: First, we're out of time, but before you go, I got to ask you, the Wall Street Journal, Ben Carson for president? You're retiring as a surgeon this summer. What do you make of it? Are you going to get into politics?

CARSON: It's not my intention to do that. But as I always say in every part of my life, I'll leave that up to God.

KARL: That sounded far from ruling it out. Thank you very much, Dr. Ben Carson. Appreciate your time.

CARSON: Thank you.

KARL: You can read an excerpt from Ben Carson's book, "America the Beautiful" at our website, abcnews.com/thisweek. And now good news to report. For the third week in a row the Pentagon released no names of service members killed in Afghanistan. But there was a reminder of service and sacrifice of our soldiers there. On Monday President Obama awarded the Medal of Honor to Army veteran Clint Romesha, whose son stole a bit of the spotlight before the ceremony began. Romesha fought back tears as he was presented with the award for leading a charge against Taliban fighters who had attacked a small outpost in 2009. Eight Americans died in that battle. We honor the service of Romesha and all of those soldiers.

And finally, "Your Voice" this week. The question comes from Yasin who asks, "where can I rewatch your programs?" Well, thank you for watching. Every "This Week" episode is available at our website, abcnews.com/thisweek. You can also check out our exclusive web-only interviews, like this morning Newt Gingrich will be sticking around to answer your questions. That's all for us today. Thank you for sharing part of your Sunday with us. Check out "World News" with David Muir tonight. George will be back next week, and we hope you will too.

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