A top senator on the president's deficit commission stood strong in the face of fierce backlash against the commission's draft recommendations. In an exclusive interview on "This Week," anchor Christiane Amanpour asked Sen. Kent Conrad, D-N.D., about the controversy.
"You know, a certain amount of this is shock therapy," Conrad said. "There are different options and, of course, what everybody has fastened on is the most extreme of the options. But, look, the important thing for people to know is that we are borrowing 40 cents of every dollar we spend. That's utterly unsustainable. It can't continue much longer, so it's got to be dealt with."
Amanpour asked Conrad if he would be willing to get on board with one of the more controversial parts of the proposal; eliminating so-called tax expenditures. Conrad said he'd prefer to raise revenue through other means.
"There is one proposal that eliminates all the tax preferences, all the tax deductions, all the tax exclusions, and uses 90 percent of the revenue to reduce rates," he said. "I don't favor that approach.
"I think we need something that represents a continuation of the mortgage deduction, although reformed, to apply only to primary residences, for example, but we need to continue the child credit, we need to continue the earned income tax credit," he said.
"Fundamentally, if we're going to raise revenue, I don't think the way to do it is to raise rates. I think the way to do it is to eliminate some of the loopholes that exist in the system," the senator said.
The co-chairmen of National Commission on Fiscal Responsibility and Reform, Erskine Bowles and Alan Simpson, Wednesday released a draft proposal for reducing the nation's deficit and debt. It called for substantial cuts in spending, cutbacks in Medicare and Social Security payments, along with some tax increases.
"In my view, Democracies seem to be uniquely suited to putting the traffic light up after the fourth accident," said David Cote, chairman and CEO of Honeywell International and a member of the commission who joined Conrad on "This Week."
"Now, we can't wait for the fourth accident here."
"It's too easy for the demagogues and the polemicists to respond to something, just kind of go into their neutral corner and screaming, as opposed to saying there's a time to pull together. This is one of those times," Cote said.
"And it scares me that as a financially conversant CEO, I didn't know how bad this was going to get in the next 10 years," he explained. "I think the American public is ready for this discussion, but I don't see anybody having that discussion with them, and that needs to happen."