'This Week' Transcript: Senate Minority Leader Mitch McConnell

WILL: Well, first of all, the default itself doesn't scare some people, because the big loser in the conflict last August was Standard & Poor's. Standard & Poor's said we are appalled and we're going to lower your credit rating. They did, and the money flowed in, not out of this. We're borrowing today at about 40 percent less cost than we were before our debt was downgraded.

STEPHANOPOULOS: But you don't you...


WILL: ... default -- the question is, do you have to default? Pat Toomey says, look, our interest charges are about $300 billion a year, our tax revenues are 10 times that much. We can pay the interest charges if we prioritize and don't pay something else.

STEPHANOPOULOS: Meanwhile, Jon Karl, some Democrats on Capitol Hill -- the president says he's not going to do it -- say he should go to the 14th Amendment and simply not allow the United States to default and keep on borrowing.

KARL: And it's hard to imagine that they're not going to be tempted to look at that again, given how adamant...

STEPHANOPOULOS: Even though they've ruled it out so far.

KARL: They have ruled it out. The White House has said they are not going to do this, that Congress must act on this. But they are saying no negotiations on this.

I would say, on Standard & Poor's, it's interesting to look at what their guidance is now. They're saying the risk is not that Congress won't act to raise the debt limit. They're saying the risk is that Congress may undermine what little deficit reduction is already put in place. They're worried about the underlying problem, which is that we have an exploding deficit problem.

REICH: I think...

IFILL: The American people are worried about an underlying problem, too. We just heard Mitch McConnell say something everyone can agree with, which is it's beyond me how we got to this point, where we were right at this deadline on New Year's Eve. The president has said it's beyond me that people can't just do their jobs. And American people are saying it's beyond me that they were there doing this. What -- that is the underlying question.


STEPHANOPOULOS: ... didn't the American people vote for it? If you look at that -- and let me bring this to you, Greta...

IFILL: Did they?

STEPHANOPOULOS: ... Van Susteren, I mean, that's what they voted for. You voted for -- a lot of people believe this is not going to get solved until either Republicans win the White House or Democrats take control of the House.

VAN SUSTEREN: Well, maybe the strategy shouldn't be, how do you win? Maybe the strategy should be, how do you have sort of a sense of decency in your job and responsibility? Maybe they shouldn't take the long vacations that they do. I mean, look at the -- look at the debt ceiling, August 2011 is when they set the sequestration. The super-committee didn't make a decision by November. So what did they do? They did absolutely nothing, December, January, February, going all the way up to August. They all took the month off in August.

Then in September, they all started campaigning, and we paid their salaries to campaign. Maybe they ought to have a personal sense of decency and stop worrying about winning and trying to at least begin thinking about solving it.

REICH: Look, George, I think that the only way that the president can win on the debt ceiling is by mobilizing the business community, mobilizing Wall Street, putting huge pressure on Republicans in Congress right now. It's got to be done right now. It can't wait. The economy really will suffer if we go right up to that deadline, because it's not like the fiscal cliff. We're talking about the full faith and credit of the United States.

STEPHANOPOULOS: And if that doesn't work, Bob, I mean, does the president really -- can he really sustain this notion that he's not going to negotiate?

REICH: He can't. That's why he needs Wall Street...



REICH: ... and the business community behind him saying, don't jeopardize the full faith and credit of the United States. It is an abuse of power to subject the United States to that kind of potential danger.

VAN SUSTEREN: But how much negotiating is he doing? Last week, he had to outsource it to Vice President Biden, because he doesn't have the relationships, he hasn't spent the years, whether as president or a senator, developing the relationships so he can negotiate. He actually had to outsource it to Vice President Biden to go up to see his old friend, Senator McConnell. I mean, Washington is so dysfunctional that...


IFILL: But what -- but what negotiations start with someone saying, "OK, I'll give you this"? They never start that way. They start with, "This is my line." And that's where you begin to talk.


VAN SUSTEREN: But you've got to -- but you've got to trust each other. In order to negotiate, you have to have some sense of trust. It hasn't just to be about winning. And there's absolutely no...


STEPHANOPOULOS: But it can't just be leaders, it has to be followers, and that's why I want to come to Jon Karl on this. Speaker Boehner couldn't -- couldn't move his caucus along. And you were on the floor during his -- the vote for his new speakership, and it was a lot closer than anyone really expected.

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