'This Week' Transcript: Bonuses, Bailouts and Budgets

BERNSTEIN: The president is prepared to negotiate on this budget with folks like those at this table, and certainly Senator Conrad has been a longtime budget negotiator at times like these. And the president's been very clear about this, as has our budget director. We don't expect these folks to sign on the dotted line.

What we do expect -- what we do expect and what we are going to stand very firm on, because this president, this vice president have made this clear, that there are these priorities that brought them to the dance here: energy reform, health care reform, education, all done in the context of a budget that cuts the deficit in half over our first term.

STEPHANOPOULOS: Yet -- yet as the president's pursuing these priorities, you have former supporters on -- on the stimulus, like Senator Collins, saying, no, she can't go along. You've got Democrats, like Senator Conrad, saying your ideas on taxes we can't accept.

BERNSTEIN: Well -- well, George...

STEPHANOPOULOS: You're not going to get the kind of revenue you're calling for. So these are really major changes the president has to contemplate.

BERNSTEIN: Not necessarily, George. I mean, we've -- we've been here before. This is opening negotiations of a -- of a large and historically unique budget.

Now, we know that this budget ramps up deficit spending in the first couple of years. And the reason we do that is because this economy is facing something we really haven't talked about yet today, one of the deepest and more far-reaching recessions of any of our lifetimes, backed up by a -- a crisis in financial markets that we haven't seen since the days of the Great Depression.

Let us not lose sight of the people who realty haven't come into this conversation yet, middle-class folks who are facing an 8 percent unemployment rate, African-Americans, facing a 13 percent unemployment rate, over 20 million people underemployed right now.

And so this budget needs to take into account the difficulties that American families are facing in the face of the toughest recession of many of our lifetimes.

STEPHANOPOULOS: Congressman Pence, and the question is, will the House Republicans and Republicans in general also come up with a budget that addresses the kinds of concerns that Jared Bernstein just raised?

PENCE: The House Republicans are going to come up with a budget alternative that is going to be built on fiscal restraint and getting this economy growing again. Look...

STEPHANOPOULOS: A comprehensive alternative?

PENCE: It's going to be a comprehensive alternative. And let me tell you, after -- it's after months of runaway spending on the federal level. I mean, we saw last -- last year's Wall Street bailout, the part of -- auto bailout, and then we saw the so-called stimulus bill, then the omnibus bill.

You know, the American people have had it. I mean, the president's budget, the American people know, spends too much, taxes too much, and it borrows too much. And they want this government and this administration to start doing what families in my district in eastern Indiana, small businesses and family farms are doing, and that is making decisions, setting aside tomorrow what we don't have to spend until today, and putting the family budget ahead of the federal budget.

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