'This Week' Transcript: Madeleine Albright, Sen. Lindsey Graham, Sen. Kent Conrad and David Cote

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AMANPOUR: The back-and-forth on whether to extend the Bush tax cuts, one of the topics for our roundtable with George Will, Nobel Prize-winning economist Paul Krugman of the New York Times, Washington Post columnist Ruth Marcus, and Robert Kagan, foreign policy analyst and author from the Brookings Institution.

Thank you all for joining us. Thank you for being here.

The deficit commission, we had two members just -- just -- just earlier. You've written very, very strongly about a lot of the proposals, among other things, saying this proposal clearly represents a major transfer of income upward from the middle class to a small minority of wealthy Americans.

KRUGMAN: Yes. I think the most important thing to understand is that the commission did not do its job. It has a bunch of ideas for reducing the deficit, some good, some really bad, some of them not ideas about reducing the deficit at all.

But, you know, anybody, it's easy to come up with ideas. I can come up with ideas for reducing the deficit while padding my tummy and rubbing my head, you know?

AMANPOUR: What should they have done?

KRUGMAN: What they -- what they were supposed to do was produce something that was good enough to have an up-and-down vote, something that a lot of people could sign on to, and they did not do that.

In particular, now, leaving aside the distributional stuff -- which is awful -- the core of the deficit problem, everybody who's serious knows the core is health care costs, and you have to reduce health care costs, not reduce them, but reduce the rate of growth. The way you have to do that is by deciding what you're going to be willing to pay for.

They completely wimped out on that. They simply assumed they were going to reduce the rate of health care cost growth. And they said, how are we going to do that? By monitoring and taking additional measures as necessary.

So the report was completely empty on the only thing that really matters and then had a whole bunch of things which involved large tax cuts for the top bracket. What on Earth is that doing in there?

AMANPOUR: What on Earth, George?

WILL: Well, Paul is speaking about the commission in the past tense, as though it has just reported. If fact, 2 of 18 members have now given their ideas; the other 16 have yet to be heard from.

The most interesting thing they did propose, interesting, A, because it's somewhat radical and, B, because it's opaque as to what it means is a 21 percent limit on revenues, not on spending, but on revenues. And I don't know what a cap means.

One Congress can't bind the other, and I don't know how institutionally how that would work, but certainly raising the early retirement age to 64 is overdue. Raising the retirement age under Social Security to 69 by 2075 is dilatory, should be done next Thursday.

AMANPOUR: A goer at all? I mean, certainly, the liberals are screaming bloody murder over this.

MARCUS: Actually, both sides are screaming bloody murder. And like most people screaming bloody murder, I think they're behaving incredibly childishly...

AMANPOUR: Well, you've told the president to be professorial about this, didn't you?

MARCUS: Professorial and the grown-up...

AMANPOUR: Written about it, anyway.

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