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Gregory: Secretary Panetta has said the following about the impact of that. sequester, he said, which is the process by which those automatic triggers go into place, will lead to a hollow force that in effect invites aggression. He also said in a letter to senator Mccain of armed services, the impact of these cuts would be devastating for the department of defense. as a result we would have to forumlate a new security strategy that accepted substantial risk of not meeting our defense needs. would you support a workaround of some measure that would not -- that would prevent the automatic tax cuts from going into place. excuse me, automatic lick spending cuts.
Kyl: what people should know is that one way or another we're going to have $1.2 trillion in reduced spending. it could either be done the ugly way, which would happen if our committee fails. or we could do it more intelligently. but we do have the opportunity, even if the committee fails, to work around the sequester so that we still have $1.2 trillion in savings over ten years. but it's not done in the very draconian way that secretary panetta is referring to. now that will require work on congress' part, and some agreement. but i can't imagine that, knowing of the importance of national defense, that both democrats and republicans wouldn't find a way to work through that process so way still get to $1.2 trillion in cuts, but it doesn't all fall on defense as secretary panetta pointed out.
Gregory: so you don't think the defense cuts will happen?
Kyl: well, i think there's a way to avoid that, if there's goodwill on both sides. again, i think when the reality sets in and even those democratic friends who would like to see more defense cuts, when people like secretary panetta says this would be extraordinarily bad policy for the national security of the united states, we'll find ways to work around that.
Gregory: do you feel some urgency to get this done? what about the potential of another downgrade of america's debt?
Kyl: again there's going to be $1.2 trillion in savings, whether the committee agrees on a method of doing it or it happens automatically, as you say. this shouldn't foster a downgrade or run on the market or anything like that. $1.2 trillion in savings occurs one way or the other.
Note Kyl's language: he never says 1.2 trillion in deficit reduction. He says, "cuts", "savings", "reduced spending." No taxes or revenue of any kind. He's simply asserting that this is about discretionary and mandatory domestic spending cuts, period. And that trigger obviously means nothing.
Then, you had John Kerry on right afterwards saying that the Democrats were more than willing to take a meat ax to the budget as well but they really, kind of, wanted some revenue too. It doesn't look like they are going to get even that (thank God.) But the terms of the election year debate are all going to be about how the Democrats are insisting on raising taxes. After all, the only spending cuts that are controversial anymore are the defense cuts --- which Democrats will never fight for.
In fact, the Republicans will be able to say quite honestly in their campaign ads that the Democrats want to cut social security and medicare and raise taxes.
Those are all very popular stands with the public.
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