In an interview this morning, House minority leader Nancy Pelosi made the case that we don't have a spending problem. Indeed, Pelosi says, it is wrong to say we have a "spending problem"
Here is the full Interview
WALLACE: Congressman Pelosi, welcome back to FOX NEWS SUNDAY.
PELOSI: Welcome to the Capitol.
WALLACE: The White House says, sequestration will have a severe effect on many Americans. House Republicans agree. But they say the answer is to find other spending cuts, not tax hikes. PELOSI: Well, I think that the sequestration is a bad idea, all around. It is something that is out of the question. The fact is, we have had plenty of spending cuts, $1.6 trillion in the budget control act.
What we need is growth. We need growth with jobs. And if you have spending cuts, education of our children, other investments, on the National Institutes of Health, where you are hindering growth, you're no going to reduce the deficit.
So, what we do need is more revenue, and more cuts, but I would like to see that a big, balanced, bold proposal. Short of that, we should -- we must do something to avoid the sequester.
WALLACE: But here's what House Speaker Boehner said this week.
REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: At some point, Washington has to deal with its spending problem. I watched them kick the can down though road for 22 years I have been here and I have had enough of it. It's time to act.
WALLACE: Congresswoman, let's look at this numbers. Are you really saying that in a government that spends $3.5 trillion a year, that increased federal discretionary spending by 14 percent, over the last four years, you can't find $85 billion to cut, to avoid the sequester?
PELOSI: Well, we have cut in terms of agriculture subsidies, there are tense of billions of dollars in cuts there and that should be balanced with eliminating subsidy for big oil. Why should we do -- why should we lower Pell Grants instead of eliminating the subsidies for big oil?
WALLACE: Why not just cut spending? Eighty-five billion dollars in a $3.5 trillion government.
PELOSI: Let's back up from -- with all due respect to the speaker, what he said is not the gospel truth. The fact is that a lot of the spending increases came during the Bush administration. Two unpaid for wars we got ourselves engaged in. A prescription drug plan that added enormous amounts to our spending, and the tax cuts at the high end that did not create jobs and create revenue coming. So that's --
WALLACE: But the total debt has increased $5 trillion since this president came in.
PELOSI: Well, part of that is from the -- what we had to do to avoid going over the cliff of the recession -- depression. Yes, we had the Recovery Act which saves or created 3.5 million jobs. You know the record of job growth in the private sector has been consistent from many record number of months.
So, again, we have to make a judgment about what -- how do we get growth with jobs? That's where the revenue comes from. You don't get it by cutting down your (INAUDIBLE) or cutting in education, cutting back on investments in science, and National Institutes of Health, food safety, you name it.
So, it isn't as much you a spending problem as a priorities, and that is what the budget is, setting priorities.
WALLACE: But you talk about growth. Even Christina Romer, the former head of the Council of Economic Advisers for the president, says you increase taxes, that also hurts growth.
PELOSI: Well, it's about timing. It's about timing. And it's about timing as to when make cuts, as well. We --
WALLACE: But you -- the fiscal cliff, you raised taxes $650 billion, right away.
PELOSI: Yes, and that was a very good thing to do on people making over -- the high end in our population.
So, here's the thing, though: we are here to have a budget that has revenue coming in, that has investments made, into the future. We also want to make decisions in those two areas where growth with jobs are created, because more jobs, more revenue coming in. Nothing brings more money to the Treasury of the United States, than investment in education of the American people.
So, we need to recognize that, which cuts really help us and which cuts really hurt our future. And, cuts in education, scientific research and the rest are harmful, and they are what are affected by the sequestration.
So, it is almost a false wrong to say we have a spending problem. We have a deficit problem that we have to address. Right now, we have low interest on the national debt and it's a good time for us to act to lower the deficit.
We think the deficit and the national debt are at immoral levels. We think they must be reduced. We're sick and tired of paying interest on the national debt. And that 15 percent, that's a large percentage of the budget, the interest on the national debt. It's lower now because of the lower interest rates.
WALLACE: But again, all I would say is: we've got a $3.5 trillion budget and they are talking about $85 billion in cuts.
Let me -- let's go to the taxes, though --
PELOSI: OK. But we agreed in spending -- we agreed to $1.6 trillion in spending, in discretionary, domestic spending.
WALLACE: But the sequestration is just spending cuts. PELOSI: Right. Secondly, we have gone to Medicare and had savings of over a trillion dollars in Medicare already. And when I say we, I mean the Democrats. And what the Republicans are proposing is to make a voucher of Medicare, no longer making it a guarantee. There are other things in this discussion that I think American people make fully aware --
WALLACE: We're going to touch on them --
PELOSI: -- understand what it means in their daily lives.
WALLACE: Let's talk about taxes. You keep talking about raising taxes and you talk about making the wealthy -- let me ask the question first.
PELOSI: Yes.
WALLACE: Let me ask the question: you keep talking about making the wealthy pay their fair share of taxes.
PELOSI: Right.
WALLACE: The top 1 percent --
PELOSI: Right, right.
WALLACE: -- the top 1 percent pay 37 percent of all federal income taxes. The top 5 percent pay 59 percent of all federal taxes. If you took the total income of everyone making more than $1 million a year, if you taxed it all, at 100 percent, that's only $726 billion, which is less than the projected deficit for the year.
I mean, the bottom line, Congresswoman, is you can't raise taxes enough to solve the deficit problem.
PELOSI: Nobody is saying that. We are saying it has to be balanced. Now, on the subject of the high end, we're not talking about raising rates. We did that. We eliminated the high end tax cuts of the Bush years which only increased the deficit, and didn't create jobs.
We kept the middle income tax cuts. The -- what we have in our proposal that Congressman Van Hollen has put forth, our top Democrat on the Budget Committee, is to say we'll eliminate subsidy to big oil. And it gives us a lot of money, eliminating the subsidy for big oil.
We also have the Buffett Rule which says all of the high income people would pay a minimum of -- they would have to pay --
WALLACE: So, you're raising tax on the wealthy.
PELOSI: No, you are saying they should pay their fair share, which is 30 percent, which is even lower than 39.6, which is the rate -- the bracket they are in.
WALLACE: But you are saying that if they have a deduction from a home mortgage --
PELOSI: They take advantage of so many loopholes.
WALLACE: Well, deductions that are on the books. But the point is --
PELOSI: Thirty percent.
WALLACE: The point is, that you can't raise enough money. I mean, the main driver of the debt is entitlements. Sixty percent of our budget, our spending, is on entitlements.
When Medicare started life expectancy was 70. It's now 79. Don't you have to raise the eligibility age and slow the growth of benefits? Isn't that the way to deal with the deficit?
PELOSI: OK. I'm glad you brought up Medicare because don't you think you should -- to use your question -- don't you think you ought to see if raising the age really does save money?
Those people are not going to evaporate from the face of the Earth for two years. They're going to have medical need and they're going to have to be attended to. And the earlier intervention for it, the less the cost will be and the better the quality of life.
I do think we should subject every federal dollar that is spent to the harshest scrutiny. And I do think the challenge with Medicare is not Medicare, the challenge is rising medical health care costs in general and prescription drugs and the rest of that, that driver those costs. So, that's what we have to address, which we did in the Affordable Care Act and we are about to see some reports from the Institute of Medicine, about how we reduce the cost of health care, in Medicare, because we are paying for quality, not quantity of procedures, but quality of performance.
And I think that there is money to be saved there. And I don't think it has to come out of benefits, or beneficiaries, and I don't think you have to raise the age.
WALLACE: Gun control will be a big part of the president's agenda in the State of the Union address Tuesday night. But I want to ask you about another part of the effort to stop these horrible, repeated acts of mass violence. As part of your plan, you call for more scientific research on the connection between popular culture and violence.
We don't need another study, respectfully. I mean, we know that these video games, where people have their heads splattered, these movies, these TV shows, why don't you go to your friends in Hollywood and challenge them, shame them, and say, "Knock it off"?
PELOSI: Well, I do think, whatever we do, because when you talk about evidence-based, we have that throughout our proposal. In other words, we don't want to just anecdotally writing bills. We want to have the evidence to say -- WALLACE: Well, I'm not sure you want to write bills anyway. But don't you -- I mean, what would -- you have a lot of friends in Hollywood. Why don't you go to them and publicly say I think challenge you to stop the video games?
PELOSI: I do think -- see, I understand what you're saying. I'm a mother, I'm a grandmother. But, they tell -- not they, not Hollywood, but the evidence says that, in Japan, for example, they have the most violent games and the rest, and the lowest -- death, mortality from guns. I don't know what the explanation is for that except they may have good gun laws.
But I think you took one piece of it. We are talking about -- we are talking about stop -- no further sales of assault weapons. What is the justification for an assault weapon? You know, no further sales of those.
No further sales of the increased capacity, 30 rounds in a gun. We are talking about background checks which is very popular, even among gun owners, and, hunters. We avow the First Amendment, we stand with that, and say that people have a right to have a gun to protect themselves in their homes and their jobs, whatever. And that they -- and their workplace -- and that they, for recreation and hunting and the rest.
But we are in the questioning their right to do that --
WALLACE: I guess the question is -- I think a lot of people say, here it is, liberals like Nancy Pelosi want to go after gun owners. But, when it comes to mental health laws, when it comes to their liberal friends in Hollywood, they don't want to make them ante up.
PELOSI: Well, mental health laws, I have to tell you, when I was speaker and we couldn't get a hearing on this before that we passed the mental health parity act and, in the Affordable Care Act we took it to the next step and in another year you -- we'll have many more services available, because of mental health parity.
We certainly have to do more. And, I salute the -- applaud all of those who are saying we have to do more in mental health. But we have to do it, I think, we have to do it all and that is why we said -- we included in there we have to look at what these games are.
I don't think we should do anything anecdotally. We have a saying here -- the plural of anecdote is not data. And so, we want to know what is the evidence, what would really make a difference here. And I think it has to be comprehensive.
WALLACE: Finally, President Obama predicted this week that you will once again be speaker -- his words -- pretty soon.
What do you think of the chances of you regaining the majority in the House and you, once again being Speaker Pelosi after the 2014 midterms?
PELOSI: Well -- that's nice he said that. But the fact is, what is important, the Democrats regain the majority in the House. Between now and then, we have a lot of work to do.
We want to pass comprehensive immigration reform. We want to pass, keep our kid safe and pass some initiatives that relate to gun violence, prevention. We want to create jobs and have initiatives for growth with jobs.
We want to make our country more democratic in terms of how elections are conducted, reducing the role of money, increasing the level of civility so that more women and young people participate. It's about confidence -- confidence in our democracy, confidence in our children's safety, confidence in our economy, confidence as to who we are as a people.
So, we have plenty to do before then. But what the president said was complimentary, but as far as I'm concerned, it's about the issues and the issues are better served by a Democratic majority in my view, and that's what I'm hoping that we will achieve in 2014.
But as I say, that -- we have a lot of work to do, hopefully in a bipartisan way, between now and then. And I think that in the issues that I named, we could get bipartisan collaboration.
WALLACE: Congresswoman Pelosi, thank you.
PELOSI: Lovely to see you.
WALLACE: Always a pleasure to talk to you.
PELOSI: My pleasure. Thank you.
