Friday News Roundup - Hour 1

Transcript for: 
Friday News Roundup - Hour 1

MS. DIANE REHM

10:06:54
Thanks for joining us. I'm Diane Rehm. Tough budget negotiations continue this week. Minnesota's government remains shut down. And U.S. employers added only 18,000 jobs in June, far fewer than expected. Joining me to talk about the week's top domestic stories on the Friday News Roundup, John Dickerson of slate.com and CBS, Laura Meckler of The Wall Street Journal and Dan Lothian of CNN, who I welcome for the first time. Good to have you, Dan.

MR. DAN LOTHIAN

10:07:33
Thank you very much. It's good to be here.

REHM

10:07:34
Let's talk about these job numbers, John Dickerson. The White House -- first White House reaction to the unemployment rate, it's unacceptably high. But they go on to say it's important not to read too much into any one month's report. And that's from Austan Goolsbee.

MR. JOHN DICKERSON

10:07:59
Who is probably happy that he's not going to be too much longer in the administration because it's a -- it's -- this is the best, I suppose, they can say, but it's not very good, either politically or substantively. I mean, what's shocking about these numbers is that the consensus forecast was, before these numbers came out, that there might be 100,000 jobs or in that range. Even some people were forecasting higher, so you've got a real punch in the gut here.

REHM

10:08:26
So how do you explain this?

DICKERSON

10:08:29
Well, this is what -- I mean, the companies aren't hiring. The people would say because there's uncertainty both in the economy and in the picture in Washington in terms of the debt deal. Other people would say because productivity is up, companies are continuing to make money and squeeze more per worker and don't necessarily then need to hire more workers.

DICKERSON

10:08:49
There's also one interesting number that -- the number of the unemployed for less than five weeks grew by about 400,000. That hasn't happened since August of '08. And the idea there is, or the -- and, again, this is just, you know, kind of reading initial signs. But could there be something happening here, a new kind of wave? Does that signal a new potential wave in these numbers?

REHM

10:09:10
Laura Meckler.

MS. LAURA MECKLER

10:09:12
Another drag on it is government hiring. The government payrolls dropped by 39,000 in June alone. So there was a little bit more private sector growth. There was about 57,000 private sector jobs created, still very low. But the government -- some, you know, state governments laying people off, that doesn't help the situation either.

REHM

10:09:35
Dan Lothian.

LOTHIAN

10:09:36
I don't think you can underestimate this word, uncertainty. I was on the road a few weeks ago, and I was talking to a business owner. And he told me that he's ready to hire, he is ready to grow, but he needs more certainty in the market before he can do that. And you hear that time and time again. And, you know, we can talk about all the other factors that play into this.

LOTHIAN

10:09:57
But if business owners don't feel like they know which way the economy is going, why should they gamble on loading up with more employees?

MECKLER

10:10:07
And I don't think we can underestimate the impact that this has on the political conversation in the upcoming presidential election. I mean, where, you know, Austan Goolsbee says don't read too much into any one report -- and they have said that before -- they practically say that every month. They say it whether the numbers are good or bad. But the fact is we've had three months in a row now of bad numbers.

MECKLER

10:10:28
And this looks more and more like one of the worst recoveries that this country has seen since, you know, going back to the '30s. We're talking about this could be years before the job market fully recovers. So there's a statistic often used about how, you know, president had -- only one president has won a re-election with unemployment this high, you know, since World War II. But I think it's even more profound than that.

MECKLER

10:10:52
If you look at the numbers, very few presidents have stood for re-election with unemployment this high. I mean, we're talking at very, very high levels. It's very rarely been at this level. And so, I think, this is a big problem for the president.

LOTHIAN

10:11:04
Look -- and I think that's why you'll see the president, you know, this event added today. He's coming out at 10:35 this morning, scheduled to come out to the Rose Garden and talk about this. And perhaps what we'll hear from him is what we've been hearing in recent weeks, is that, take a look at the overall picture, that everything is moving in the right direction.

LOTHIAN

10:11:21
And the president will probably walk us back to where the economy was before he came into office, how much deeper it was once he got in, and how he believes he was able to bring the economy back from sort of this brink of this free fall. So I think that's the message you'll hear from the president today.

REHM

10:11:37
John Dickerson, how are these numbers likely to have any impact on this weekend's discussions?

DICKERSON

10:11:47
I think they put even more pressure on a deal. We -- the latest reporting from my conversations last night is both sides are optimistic they're going to get somewhere now that we can talk about the shape of the deal. Usually, what happens is you have one side being optimistic in order to put pressure on the other side to say, basically, we're really close if they would just agree. But in this case, you had both sides suggesting a new sense of optimism.

DICKERSON

10:12:08
And, I think, for the president, who has very little he can actually do to fix these economic numbers, he needs to be able to come out and say, I did something big. I helped to put together a big deal. Now, there are plenty of people, particularly on the left of his party, who would say that cutting government jobs, that taking money out of the economy is just absolutely the worst thing you can do in a bad economy.

REHM

10:12:27
How did we get from the cutting $2 trillion to now cutting $4 trillion? I don't get it.

MECKLER

10:12:36
Well...

LOTHIAN

10:12:36
Well, look, I mean, a couple of things. First of all, you know, there was all this talk about maybe a mini deal, and the White House shot that down very quickly. The president himself came out and said that that was not something that he was pushing for. I think, you know, to jump off what John was saying, the president wants to do something that essentially doesn't kick the can down the road, to use a term that the White House likes to use.

LOTHIAN

10:12:58
They -- he wants to show that he's being aggressive on this front. So that's why he doesn't want something small or insignificant, I think.

MECKLER

10:13:07
But, you know, the $2.4 trillion they were talking about was never considered small. The mini deal was always more like $1 trillion.

REHM

10:13:14
Right.

LOTHIAN

10:13:15
Right.

MECKLER

10:13:15
The $2.4 trillion was considered what you -- the price of what they wanted, or to extend the debt limit...

REHM

10:13:19
The Republicans are on it.

MECKLER

10:13:20
The Republicans insisted on...

REHM

10:13:21
Right.

MECKLER

10:13:22
...at least $2.4 trillion to get us beyond, to extend debt ceiling long enough past the 2012 elections. But then -- but at the same time, we had both President Obama and the House Republicans with their own long-term deficit reduction plans that were in the $4 trillion range. Nobody really thought that this deal was going to try to tackle those.

MECKLER

10:13:41
Those -- in order to get to $4 trillion, you're talking about tax code, tax increases. You're talking about entitlement spending, Social Security, Medicare. You're talking about fundamental stuffs in the -- in government spending.

REHM

10:13:53
But there's...

MECKLER

10:13:55
And, now, that stuff is suddenly on the table because they're saying, hey, if we're going to do this, let's do it.

REHM

10:13:59
Okay. But there's another sort of shift in vocabulary. Is there not, John?

DICKERSON

10:14:05
Right. There are a couple of different shifts in vocabulary. So you come from two to four by the president basically saying, let's go big or we'll go home. And so that meant two things: one, taking on these entitlements -- and he's so -- he said, look, if I'm willing to change the cost of living increases for Social Security, maybe, or make some of these changes that he'd already proposed in Medicare, you Republicans have to be willing to raise taxes in some fashion.

DICKERSON

10:14:28
Now, the definition of what it means to have a tax increase is going to be very fungible here. And there are ways in which you can raise taxes (unintelligible) by closing loopholes. And you call it that instead of tax increase, or you can talk about having no net new tax increases. But part of the deficit number is part of -- you can count part of the deficit number as future tax increases -- sorry, pardon me -- future tax cuts.

DICKERSON

10:14:53
Therefore, if you close loopholes in one place to pay for those future tax cuts, you can claim savings. But as a net matter, there is no actual net new tax increase.

MECKLER

10:15:02
But if we have a $2.4 trillion deal, the sort of medium range, I think, that's what we're going to see. A revenue neutral deal is what they're calling. So you may have some tax cuts, other tax increases and call it a wash. And it can be sold as no new taxes net. But if you end up with a $4 trillion deal and if Democrats go along with Social Security cuts, then they're talking about $1 trillion in new taxes.

REHM

10:15:27
But, you know, before...

MECKLER

10:15:28
So that's a real tax increase.

REHM

10:15:29
Before you start talking about Social Security cuts, what they are talking about possibly is what, John, extending the amount of salary from which Social Security monies...

DICKERSON

10:15:46
Well...

REHM

10:15:46
...can be taken...

DICKERSON

10:15:47
...I don't think so. No. I think one -- at least we got to be careful here. One this is that a lot of things are being discussed.

REHM

10:15:53
Right.

DICKERSON

10:15:53
And the level of discussion and the interconnectedness of some of these things is quite -- it's a moving picture. And -- both on the tax side and the spending side. But, so far, the only thing I've heard in the context of Social Security is just changing the cost of living increase. There's the long-time debate about how you accurately measure inflation, and there was not a cost of living increase in the last Social Security -- the last time around...

REHM

10:16:20
The last two years.

MECKLER

10:16:21
Yeah, that's right.

DICKERSON

10:16:21
Two years.

LOTHIAN

10:16:21
That's right.

MECKLER

10:16:22
And, I mean, the interesting thing...

LOTHIAN

10:16:22
Raising the retirement age as well?

MECKLER

10:16:24
No.

DICKERSON

10:16:24
No.

MECKLER

10:16:24
Well, those are -- see, what has always been talked about Social Security and doing -- if you're going to do a Social Security deal, there would have several elements, including what you guys just mentioned, maybe raising the retirement age, the adjustment to the inflation, and also subjecting more taxes...

REHM

10:16:39
Exactly.

MECKLER

10:16:39
...I'm sorry -- more of your pay...

REHM

10:16:40
More salary.

MECKLER

10:16:41
...more salary...

LOTHIAN

10:16:41
Right.

REHM

10:16:41
Right.

MECKLER

10:16:42
...to earnings -- excuse me -- to the payroll tax. That is what the -- that is what has been talked about at the confines of a Social Security deal. This is something different. This is saying we're going to do a deficit reduction deal. We're going to pull one element potentially out of the Social Security menu, this one benefit cut which is the inflation adjuster.

MECKLER

10:17:01
And we're going to put that in as a tradeoff, not for other Social Security changes, but for, perhaps, tax increases in some other realm, other things dealing with the overall picture. And that really has a lot of people on the left very, very upset because they believe if you're going to make -- number one, they don't want to see cuts at all. But, number two, they say -- a lot of groups, like AARP, for instance, what they say is, we might be able to accept a benefit cut, but we want it done for Social Security, in the context of Social Security.

DICKERSON

10:17:30
Right. Instead, the argument will be, this doesn't have anything to do with shoring up Social Security. You're just looking for a place to find some money...

MECKLER

10:17:35
Mm hmm.

DICKERSON

10:17:35
...and also be able to claim for the president. Look, I went after one of my own sacred cows here. And, therefore, Republicans should come along in some kind of a tax deal of some size. Well, regardless -- and, again, it's going to become a debate here about what you call a tax increase and what you don't.

DICKERSON

10:17:52
But we should -- finally, there's one other important political piece here, which is that the president, by going big at $4 trillion -- and let's say they only get the 2.5, the sort of middle option -- the president can then campaign and say, look, I was going to go for $4 trillion. I was even willing to go after Social Security and Medicare and do all of these risky things within my own party.

DICKERSON

10:18:09
But Republicans, because they are so, you know, hard over on protecting the rich -- I'm now speaking in his political voice -- ...

REHM

10:18:15
Right.

DICKERSON

10:18:15
...wouldn't do it. And so that he could both get a deal at 2.5 and then also have an issue, that's one of the possible outcomes.

REHM

10:18:23
John Dickerson, he's chief political correspondent for slate.com and CBS political analyst and contributor. Short break here. We'll be right back.

REHM

10:20:03
And just before the break, we were talking about the negotiations that will go on this weekend over resolving issues between Democrats, Republicans, the administration -- a lot of parties here -- and whether there are contingency plans in place, John Dickerson, if they cannot reach some sort of agreement.

DICKERSON

10:20:30
You know, if there are contingency plans in place, it's in no one's interest -- particularly the people who would be making such plans -- to let them know that they're out there. And Treasury Secretary Geithner apparently briefed the president and congressional leaders in the meeting yesterday about the state of play. And at the -- at that level, everybody has agreed that it would be catastrophic. And also it gets catastrophic the closer you get up to this deadline because...

REHM

10:20:57
Of course.

DICKERSON

10:20:58
...what is being worried about here is the market reaction. Now, so far, the market -- at least, as far as the stock market is concerned -- has been in pretty good shape the last few days. People seem to think some kind of a deal will be made.

REHM

10:21:09
Up 10 percent for the year.

DICKERSON

10:21:12
Exactly. And there was a period where it had gone down, people getting nervous. But in the last...

REHM

10:21:16
Sure.

DICKERSON

10:21:16
...week or so, things have looked better. So -- and there are also -- so it doesn't look like there really is a plan B. And Republican leaders, in the one sort, are trying to get this deal done and count the votes. They certainly don't think you can -- that you can risk it in any kind of way.

REHM

10:21:32
Dan, could even talk about a plan B hurt the negotiations?

LOTHIAN

10:21:40
Well, I think so. I mean, if you have a back-up plan, then why should you agree to what's in front of you, right? The Treasury Department has been very sort of upfront in saying publicly that there is no plan B, that, really, as John was pointing out, it would be catastrophic if this Aug. 2 deadline came without any kind of deal.

LOTHIAN

10:21:57
The one thing that has been floated out there -- and I did a story about this, this week -- has been whether or not the president will invoke Section 4 of the 14th Amendment, essentially allowing him to just continuing -- continue to borrow money.

REHM

10:22:13
On a constitutional basis.

LOTHIAN

10:22:15
Exactly. The president hasn't directly knocked this down, although he said that's not something that they would be looking at. Jay Carney, White House spokesman, essentially, in a roundabout way, said that that's not something that they're talking about. But, to my knowledge, that's the only thing that the president would have, is sort of a plan B if they can't meet the deadline.

REHM

10:22:36
And here's a comment posted to our website, drshow. Steve says, "Does anyone on the panel have thoughts on why President Obama has moved so close to Republican positions? Is it because he feels he has no room to maneuver? Or does he truly believe what he's saying?" Laura Meckler.

MECKLER

10:23:04
I think it's a little bit of both. I think that this debate has absolutely been fought on Republican turf. And, from the beginning, it's all been about, you know, what spending can we cut. It hasn't been about raising taxes, if there have -- taxes have absolutely been in the -- at the back of the line, rather than the front of the conversation. Same thing -- we even -- and most of the conversation about what to cut has been domestic spending.

MECKLER

10:23:26
It hasn't been defense spending, which is something that Republicans are much more loathe to touch. So it's -- he really hasn't had a lot of options in the sense that Republicans kind of hold the cards. They've just been playing chicken with this and said, we're willing to let this come to the brink, and he isn't. So that's one thing, is he hasn't had a chance. But, on the other hand, I think he recognizes that there's a political mood in the country which says government's too big.

MECKLER

10:23:53
You are spending too much. You need to get your act together. We -- we're having to live on less money. You have to live on less money, too. There is -- that's real. And that was reflected in the 2010 elections. And I think that Obama wants to get out in front of that and wants not to be seen as being dragged along, but as, yeah, me, too, I'm for cutting government spending.

DICKERSON

10:24:10
If the economy is injured by coming up to the deadline or hitting the deadline, the president pays the penalty above all others. So they really do believe this would be an economic catastrophe, and he would take the pain of not having a deal more than anybody else. You can try and spin in the ways that other -- that Republicans would be at fault, but they believe, at the White House, you can't spin it past what would be a very bad reality.

DICKERSON

10:24:34
And the other thing is that the president's economic message, after you get past this, will be about investments and targeted investments in order to grow the economy and do things. Well, that, to some voters, might sound like your sort of typical Democratic spending, spending, spending. So in order to make that case about the future, they want the election to be about the future, as you might imagine at the White House, rather than the past and the most immediate past in terms of these job numbers.

DICKERSON

10:24:57
In order to be able to have credibility to talk about spending in specific areas, you need to be able to say, look, I am a spending cutter, and I cut a lot of spending here because I recognize that the deficit is a problem. So to what Laura is saying, meet the mood of the country, but, also, it's the predicate required for this conversation they'd like to have about the future. And the president needs to be able to say, look, I've proven myself as a person who is a good fiscal steward.

REHM

10:25:22
John Dickerson of slate.com, CBS, Laura Meckler of The Wall Street Journal, Dan Lothian, White House correspondent for CNN. What's happening here in Washington is, in another way, happening in Minnesota, where you've got an entire state shut down. Laura.

MECKLER

10:25:49
You do. And the arguments in Minnesota absolutely mirror the federal arguments, which is that they've got -- of course, the numbers are smaller. It's one state. They've got a $5 billion budget gap that they need to close. The Democratic governor, Mark Dayton, is saying that we need to raise taxes. He's suggested taxes on millionaires. He's suggested a cigarette tax. And he -- and Republicans have said, no, we need to do this on...

REHM

10:26:10
And he's got a Republican majority...

MECKLER

10:26:12
Exactly.

REHM

10:26:12
...in his state legislature, all of whom come up for election next year.

MECKLER

10:26:20
And they are saying, no, this is not a taxes problem. Just like you hear in Washington, this is a spending problem. They presented him with a budget with a lot of cuts to social services. He vetoed that. And that's where the stand-off is, and it's now been going on for a week.

LOTHIAN

10:26:33
And I think the concerns there, that the longer this goes on, it just impacts the overall economic health of that state. I think one of the things, you know, when you look at a story like that, beyond just the government workers there who've been furloughed, is the impact that this has on the private sector there in Minnesota. There are all of these people who own private businesses, who depend on the public workers spending their dollars.

LOTHIAN

10:26:59
And when they're not making money, they're not getting paid. They're not spending. And so there's sort of the ripple effect that occurs, impacting the overall health of the economy of that state.

REHM

10:27:07
You know, it's interesting that it's Minnesota. I think of Minnesota as a place where people get along.

DICKERSON

10:27:16
Right, a state that has its act together, yeah.

REHM

10:27:18
Right.

DICKERSON

10:27:19
And now we have a governor running for president from there and a congresswoman running for president there. It's a hotbed of the country's political moment. This mirrors more the conversation we had in Washington about the government shutdown from the spring because you have a situation which two-thirds of the government actually is still operating the sort of essential services in Minnesota.

DICKERSON

10:27:37
And so you have kind of a disconnect, which is that, at least, the whole thing hasn't shut down. You do have all of this money, however, that's not coming in...

REHM

10:27:46
That's right.

DICKERSON

10:27:46
...from things like the lottery, the fees at state parks, uncollected tax revenue. And so it's kind of the worst of all worlds. There's not the sense of immediate sense of urgency because the emergency services are being taken care of. On the other hand, day by day, you're losing a lot of money.

REHM

10:27:59
How much longer can a state like Minnesota afford to be shut down without economic -- real economic hardship for the entire state, Laura?

MECKLER

10:28:15
I honestly don't know how long it can go. Obviously, it gets worse the longer you go. There was one estimate that they are losing about $23 million a week in spending power between what the government workers are not spending and other ripple effects. You know, that obviously starts to add up. Their debt was downgraded by one of the rating agencies yesterday. So I think that this affects -- the longer it goes, the worse it gets.

REHM

10:28:43
Do you agree with that, Dan Lothian?

LOTHIAN

10:28:44
I completely agree. I mean, yeah, I saw that number as well, that estimate of $23 million. This is -- no one really has sort of the crystal ball to know at what point it becomes catastrophic. But every day that this goes on, or every week that it goes on, it has to be undermining the economy of that state.

REHM

10:29:01
Dan Lothian of CNN. And the most popular topic in President Obama's first ever White House Twitter town hall was jobs.

LOTHIAN

10:29:15
It was jobs. I believe -- what was it? -- 27 percent of the questions that were submitted had to deal with jobs. And I think, you know, you can look at all of the other issues that sometimes people inside Washington focus on -- the foreign policy issues, Afghanistan. Certainly, it's important. There is the overall, you know, internal debate here about, you know, what's going to happen with the debt ceiling and so forth.

LOTHIAN

10:29:38
But at the end of the day, I think the American people care about jobs. You know, they care about whether they can hang on to their homes. That was the second most popular topic, is housing, but also jobs, whether they'll be employed. And there's a lot of concern about that. And that's why you see, you know, House Speaker John Boehner will never miss the opportunity to talk to the president or ask the president about it.

REHM

10:29:59
He did it himself.

LOTHIAN

10:30:00
And, in fact, he crashed the Twitter town hall, was able to get a question in to ask the president about jobs. And the president admitted that, you know, they have not been able to create as many jobs as demand is out there for. And so, yes, jobs remains, I think, the number one priority for Americans.

REHM

10:30:21
You know, at the same time, you had Mitt Romney announcing via Twitter that he was in a meeting with British Prime Minister David Cameron. He's in London to fund-raise. He raised a good bit of money in the last few weeks, Laura.

MECKLER

10:30:41
He did. He raised $18.25 million. That's -- that was a good haul, well ahead of any of his challengers. Mitt Romney is clearly the front-runner in the Republican presidential nomination race. The question now is, really, who is going to be the alternative to Mitt Romney. For a long time, people thought it might be Tim Pawlenty. Then people kind of thought it might be Jon Huntsman, the former governor of Utah.

MECKLER

10:31:05
Now, a lot of people seem to think it might be Michele Bachmann, the congresswoman from Minnesota, who was dismissed, I think it's fair to say, by a lot of people in Washington, but is -- seems to be pretty popular out there on the trail. In Iowa, she and Romney are in -- virtually tied for first place. So...

REHM

10:31:21
John Dickerson.

DICKERSON

10:31:23
Well, I think, you know, we always -- well, a couple of things, first, on the Romney money. Big haul, you know, very good, but there are still a lot of Republicans who worry about -- that the number on the Obama side will be gargantuan, you know, close to $800 million. Some people talk about a billion. That's probably a little overstated, but...

MECKLER

10:31:38
Well, you're now speaking for the entire race, not for this month.

DICKERSON

10:31:40
For the entire race. So -- and so -- right, but Romney's haul was not as good as it could have been. It was certainly better than the others, but Romney's case is, I can run against Obama. That's why he's in London. He's looking like a presidential candidate already. He's been very smart in, really, basically keeping this race about him versus Obama. It works nicely because he can say, I was in the business world, the economy is bad, I know how to fix it.

DICKERSON

10:32:05
So for a candidate focused on the general election, if you look then at the general election money picture, what looks very good relative to his other Republican opponent doesn't look so good relative to the president. And so that's one thing to keep in mind with Romney's numbers. With respect to Bachmann, I think that we basically will have to wait to see what Rick Perry does, the governor of Texas.

DICKERSON

10:32:24
He presents a significant challenge to Bachmann in that wing of the party. We always knew it would be a split primary between the sort of Romney and then the alternative. Rick Perry looks like a very strong alternative who could run well with those conservative voters, evangelical voters that Bachmann appeals to. She's from Iowa. And she has a strength there, which is why she's doing well in that state.

REHM

10:32:46
John Dickerson of slate.com, and you're listening to "The Diane Rehm Show." We also heard from David Plouffe this week, the White House senior adviser, who said it's going to be a closer race this time than last time, Dan.

LOTHIAN

10:33:06
Well, I mean, that's the strategy as well, right? You don't want to say early on that you're going to run away with the race, but, no. They realized the reality that it is going to be very competitive. But back to, also, Mitt Romney, the White House realizes, I think, that he is the front-runner at this point because you'll hear David Plouffe talk about Romney as being a political contortionist.

LOTHIAN

10:33:26
They are going after him, and they're not really talking about any of the other Republican candidates. It's Mitt Romney. So, clearly, they view him as the person to beat, you know, as their opponent.

REHM

10:33:40
And, meanwhile, you have Ron Paul criticizing the TSA, saying that he wanted to introduce the American Traveler Dignity Act, Laura.

MECKLER

10:33:55
Right. He basically thinks that airport security should be run by the airlines, not by the government. Of course, that's much closer to the situation we had pre-9/11 before the federal government took charge of standards. And most -- of course, most of airport security now is run by the Transportation Security Administration. I think a lot of people who are experts in this field would say going back to an airline-run system would not be smart from a security point of view.

MECKLER

10:34:23
I also think that he probably is tapping into kind of a populist vein of people who don't like being, you know, told to take off their shoes or patted down in, you know, cavity searched and that sort of thing. I'm joking about the cavity search.

REHM

10:34:35
Now, where are the...

MECKLER

10:34:36
But, you know, that's -- people don't like it. And so, when you go out there and say, yeah, I don't like it either, let's get rid of it, that's a popular thing to say.

LOTHIAN

10:34:45
But...

REHM

10:34:45
There -- go ahead, Dan.

LOTHIAN

10:34:46
But look at the week that he -- you know, this week, the news out is that the airline industry does continue to be -- remain a threat for terrorism, that there are ways that terrorists are looking to bring bombs inside their bodies on to airlines. And so, while people might be frustrated that, you know, they're being patted down or whatever happens when you're trying to board an aircraft, the reality of the situation is that the threat out there remains real.

MECKLER

10:35:15
Yeah, absolutely.

LOTHIAN

10:35:16
And so this is a -- it's a message that might resonate with some, but I think it doesn't really hold a lot of water with a lot of people.

REHM

10:35:22
And, finally, John Dickerson, Casey Anthony has been convicted of lying to police about her daughter's disappearance. But she was acquitted on the much more serious murder charges. What did you think about the decision of the jury?

DICKERSON

10:35:45
Well, there was a lot of outrage because a lot of people who watched the case closely about, you know, the death of her 2-year-old daughter and looked at all of the evidence that was presented by prosecutors thought, well, of course, she's guilty. But, you know, in a criminal case, where you have to prove beyond a reasonable doubt, not guilty doesn't mean she was innocent, but it means that the case was not proven.

DICKERSON

10:36:06
And the whole reason that our justice system is balanced that way is that, you know, we want a system in which it's very hard to send people to prison because you don't want to send an innocent person, and so you had it weighted in this fashion. And so this is another example where people are unhappy, much like with the O.J. Simpson trial, where people thought he was guilty.

DICKERSON

10:36:25
Unhappy with the way it turned out, but it causes a kind of conversation again about the way our system is structured so that, you know, you don't err on the other side. And, now, she'll -- you know, people are now talking about her going on and having a career and making money off of this, which I'm sure will increase the outrage exponentially.

REHM

10:36:45
Laura.

MECKLER

10:36:46
Yeah, I mean, I think it's just very hard for anybody. They see a mother who, you know, doesn't report her child missing for, what, 31 days, who, you know, so clearly lies to police and -- which, of course, she was convicted for and doesn't seem to be all that interested in finding her or all that upset about it. I mean, all of that is very hard to see and very hard to hear. And it makes you, you know, really wonder what's going on here. How is this person going to just essentially walk away?

MECKLER

10:37:15
But, on the other hand, you know, I can't -- I don't feel like I can be here and say the jury was wrong. I didn't sit there. I didn't listen to the evidence. And from what I understand, there was no solid proof, no forensic evidence tying her to the crime. And, you know, she was also on trial for the death penalty, we need to keep in mind. So, I mean, this is serious stuff.

REHM

10:37:33
Laura Meckler, White House correspondent for The Wall Street Journal. When we come back, it's time to open the phones, 800-433-8850.

REHM

10:40:03
We'll go right to the phones in this -- our Friday News Roundup, the domestic hour. Let's go to Dan in Sussex County, N.J. Good morning to you.

DAN

10:40:17
Good morning. I'm calling in reference to the starve the beast program that conservatives devised back -- way back into the Reagan administration, where they were to cut taxes or never raise taxes, and it was further implemented on the George Bush, where we're in two wars -- didn't pay for them -- gave the prescription drug program to seniors -- never paid for it -- and ran up trillions of dollars in debt.

DAN

10:40:44
And, right now, we're -- the house of cards that they built is falling down. And they're using that as a cudgel to beat President Obama back against the head about, you know, cut the deficit by cutting all the social service programs that it can be possibly be cut, instead of raising a nickel on taxes anywhere. This is devised plan by the conservatives of the Republican Party that has been in play now for close to 30 years.

REHM

10:41:13
All right, sir. Laura Meckler.

MECKLER

10:41:15
Well, there's no question that the deficit increased quite a bit under President Bush for some of the reasons that the caller mentioned. I think, though, the overall government spending has been fueled by both parties. I don't think you can put that all on Republicans. There's -- deficit has increased quite a bit since President Obama took office. Now, he would say that it was for necessary things to save the economy.

MECKLER

10:41:36
But, nonetheless, it has been -- the deficit has been steadily climbing, so -- and I do think that there's a frustration with the incredible size of our deficit and our national debt in the country that has penetrated in a way that only happens every so often. People really start to care about this, so, I -- there certainly are Republicans who feel like the answer is, smaller government at any cost and have had that sort of starve the beast mentality. But I don't think that that's the only thing going on here. I think it's deeper.

REHM

10:42:09
All right. To Newton, Mass. Good morning, Lisa.

LISA

10:42:15
Yes. I wanted to raise the issue of what happens to the disabled with these debt limit cuts to Social Security. If they realize that -- I'm what's called a disabled adult child, which means I've been disabled since childhood. And my father's retired, so I collect according to his record. And then when -- if he's -- if I survive him, I would -- I was supposed to get more. You know, my parents and my family won't be here to help me.

LISA

10:42:46
They say they want us to live in the community. I get just over $1,000 month now. And, apparently, the disabled groups, they're saying that, you know, if you live a long time, the disabled people collect for a long time, longer than most. And this will affect us disproportionately, and we're the most vulnerable. Statistically, disabled adult children are the poorest. And it just seems, to me, it's all about numbers.

LISA

10:43:17
Nobody thinks about the disabled. No one thinks about the vulnerable. And when you rush something, then, I think, it's like designed so that no one can think about people.

REHM

10:43:29
That's a truly eloquent statement, John Dickerson.

DICKERSON

10:43:33
I think it's exacerbated in this debt discussion because it is about numbers. It's not about Social Security solvency and those other things we mentioned, raising the retirement age, expanding the amount of income that can be taxed doesn't affect the benefits side. And so those would be things that would get you more money, allow the system to be more healthy and don't affect people like Lisa.

DICKERSON

10:43:55
And so, you know, this is -- we don't know what's being discussed -- I mean, we've heard rumors and things like that or whether anything will be changed. So there's also a lot of rumors around here and people saying things that are in play, that may not, in fact, be, so we have to keep a close an eye on that, too.

REHM

10:44:13
Dan.

LOTHIAN

10:44:13
I think that's so true. I mean, so much right now, it's just about speculation. We don't know specifically what's on the table. But I think that, that's why you hear people, like, you know, Nancy Pelosi, or other, you know, progressives who are saying, you know, this can't be touched because the impact to people who are needy, have these medical needs, the disabled, is unknown, and they're scared. And I think that's why there is so much concern among the people.

REHM

10:44:38
Lisa, I wish you all the best. Thanks for calling. Here is a comment on the drshow website, "Shouldn't we be talking about the man behind the Republican stubbornness, Grover Norquist? Who elected him? Here is a man who's professed the desire to make the government so small it can be flushed down the toilet, who has all kinds of connections to Jack Abramoff.

REHM

10:45:07
"And it's his pledge that most Republicans are loyal to not the good of their constituents. More light must be shown on this man behind the foolish stance Republicans are holding."

MECKLER

10:45:25
Well, that very well may be true and what -- and Grover Norquist does have a lot of power. He is -- does oppose anything that is a tax increase in any form. Having said that, is he the one that people should be angry with? He wasn't elected. It's members of Congress who are choosing to sign this pledge, to abide by this pledge, to care what Grover Norquist says...

REHM

10:45:46
The pledge he wrote.

MECKLER

10:45:47
...that he wrote. But I don't care who wrote it. It's up to an elected official to decide whether to participate in it. So, I mean, really, Grover Norquist only has the power that elected officials give him. So, you know, I mean, that's not to say that he isn't, you know, a bad influence on the system, but it isn't -- I'm just saying, though, that it's up to individuals to make -- up to elected officials to make those decisions.

REHM

10:46:13
John Dickerson.

DICKERSON

10:46:14
And up for people -- to voters to penalize and punish those politicians or to do their own version of what Grover Norquist has done. I mean, he's a free citizen. Now, you can claim -- I mean, so the right of one person has a point of view to do everything in their power to get politicians to dance to their tune, you know, is -- should be protected, whether you like what he's doing or not. And so the way to combat it is to focus on the politicians and the choices they're making.

REHM

10:46:43
All right. To Elkhart, Ind. Good morning, Jacky. (sp?)

JACKY

10:46:49
Oh, good morning. There was an interesting op-ed in our local newspaper here at the South Bend Tribune. It was written by Ezra Klein, K-L-E-I-N. And in it, he states, I know right after the president was elected, Rush Limbaugh got up and said, I hope he fails. And in 2010, Mitch McConnell said that the most important thing for the Republican Party was to see that Obama is a one-term president. That goes above everything.

JACKY

10:47:15
And it made me think of an ancient Chinese proverb, "To appease the dragon means only that you feed your children to him last." Republicans are not going to quit. No matter what we give them, they're going to keep us in a state of constant fear and upset and agitation. They don't care about the American people.

JACKY

10:47:31
The fact that they're willing to possibly crash the whole economy over this one little thing, I mean, it's -- not that the deficit is little. But, I mean, that should be handled separately than all these safety net programs.

REHM

10:47:43
Dan Lothian.

LOTHIAN

10:47:45
Well, I think if you spoke to a Republican, I don't think that they would say that they don't care about the American people. I don't know that John Boehner -- Speaker John Boehner has ever come out and made a statement that he didn't make some kind of reference to the American people. You know, the argument can be made out there that there are some Republicans who want to see the president fail. But I think at the end of the day, both Republicans and Democrats realize what's at stake here.

LOTHIAN

10:48:13
They've all realized that, you know, it's in the best interest of the voters, or the American people, to get this debt ceiling raised. The question is, can you find compromise between, you know, Republicans and Democrats?

REHM

10:48:25
All right. Here is a question from Twitter, "Why was Mitt Romney raising money overseas?" John Dickerson.

DICKERSON

10:48:35
Americans who live in London, who can still give money -- he's not raising it from Londoners. And -- but the larger point, in addition to just getting dollars to keep the campaign going, is that it's a way for a candidate to have a sort of -- to go over and look presidential. He meets with the prime minister. He -- you can see him as a potential president when he plays in this role.

DICKERSON

10:48:58
You remember, candidate Obama did a similar thing with the European trip in which he was greeted by throngs of fans. The McCain campaign tried to use it against him. It didn't work. But this is -- so it's kind of a twofer. It's the money and the chance to sort of play act a little bit.

REHM

10:49:16
All right. To Charlotte, N.C. Hi there, Mark.

MARK

10:49:21
Hello. How are you all tonight?

REHM

10:49:22
I'm fine. Thanks.

MARK

10:49:24
I am a small business owner, and with all due respect here, I don't understand why people don't get out of the Beltway and just come to America and see. You know, we feel -- and I voted for Republicans, and I voted for Democrats. But as business owners, we all feel that our political leadership is just failing our country. And I'm not speaking about Obama. I wasn't a big fan, but, at least, he was trying to work and negotiate.

MARK

10:49:51
The Republicans signed the Grover Norquist pledge and then simply walked out on the meetings. The stock market is down because small businesses and -- really, we have to protect ourselves against a Minnesota outcome here at the end of the month. I think if they would get their act together, settle the debt issue, you would see a huge improvement on employment by small businesses.

REHM

10:50:20
So...

MARK

10:50:20
We're all just having to protect ourselves because we don't know what they're going to do.

REHM

10:50:25
So let me ask you a question, Mark. If this badgering back and forth continues and we go past the deadline that has been set on the default, who would you be blaming?

MARK

10:50:47
Well, I'd definitely be blaming the Republicans. Get in there and settle. This is not rocket science. For instance, in North Carolina, our new Republican legislators cut a 1 percent sales tax that 70 percent of the people said they wanted to keep for education. They went ahead and cut it. And now, we're laying off 17,000 teachers, which nobody wants to do. How is that going to improve education or the economy?

MARK

10:51:11
But it's all about this Grover Norquist deal. Why are we allowing somebody to really put the hedge on the American process?

REHM

10:51:21
All right. Laura Meckler.

MECKLER

10:51:23
Well, I think one interesting thing is there are a few Republicans who are willing to buck Grover Norquist, the people like Tom -- Sen. Tom Coburn, who has been in a sort of a public fight with him. He is a -- as interested in cutting government spending as anybody is, has long preached about this and has said that, yeah, we also have to raise taxes, too, as part of a balanced deal. And --

REHM

10:51:42
But they're very few.

MECKLER

10:51:43
But there are few. That's true. There are few, but I think the interesting thing what the -- what Mark said was he said, you know, we feel the country's leadership is failing us, or the leadership is failing the country. And, I mean, and that's what's going on, the sense that -- now, he's putting most of the blame on Republicans. I don't know if that would necessarily be the -- I don't think anyone really knows how that will fall out in a widespread way.

MECKLER

10:52:06
But I think that what the White House wants to show is that they are above that and trying to cut -- get up something balanced, something we give and you give.

LOTHIAN

10:52:15
But he also makes that point, that we were talking about earlier, is that uncertainty is still a big issue.

REHM

10:52:20
Of course, for him.

LOTHIAN

10:52:20
And so -- for him as a business owner.

REHM

10:52:22
Sure.

LOTHIAN

10:52:22
So if you can resolve this situation, raise the debt ceiling or any other, you know, political or financial situation that might be negotiated in Washington, then that can create more certainty for the business owners outside of the Beltway.

REHM

10:52:36
Dan Lothian, he is White House correspondent for CNN, and you're listening to "The Diane Rehm Show." Mark, thanks for your call. Let's go to Arlington, Texas. Good morning, Ed. You're on the air.

ED

10:52:53
Yes. I think President Obama is handling the current discussions with Congress poorly. I think, rather than being the calm, dispassionate negotiator that he's trying to present himself as, I think he needs to present himself more as the harsh principal of a school of juvenile delinquents. He needs to tell the American -- he needs to present himself as kind of the informer of the American public as to how poorly Congress is doing its job, and mainly the Republican-controlled House.

REHM

10:53:28
And Ed is certainly not the only one who -- even among President Obama's supporters have criticized him for not standing up more strongly, more forcibly, going directly to the people.

DICKERSON

10:53:45
Well, I would say a couple of things. One, at the press conference last week, the president did precisely what Ed is talking about.

REHM

10:53:51
Right.

DICKERSON

10:53:51
He scolded Congress. He scolded Republicans. He, in fact, compared them unfavorably to the homework habits of his daughters. I mean, everything is short of suggesting they needed a drool cup.

DICKERSON

10:54:03
So I think that that's -- I think he was pretty harsh. Now, the problem is he faces reality. There is a deadline here. He believes in the deadline. He believes that if the deadline is not met, the economy will crater. He believes that he will pay a real price if that happens. So he can lecture, and then he can deal with reality. And I think that they are dealing with reality.

DICKERSON

10:54:20
Presidents are limited in what they can do by a lot of things. And, right now, he's limited by the political situation that he faces. And he could try a big, risky, bold gambit and have a huge, massive fight Republicans, and he could fail. And he thinks that the chances of failure are large, and they would be catastrophic. And so he is doing the best he can, given the hand he faces.

REHM

10:54:44
All right. To Owosso, Mich. Good morning, Brian.

BRIAN

10:54:49
Good morning, Diane. Basically, the reason I'm calling is I really dislike the confusion that has been displayed by so many people about the -- they equate raising the debt ceiling -- like, if you don't raise the debt ceiling, we will default on our loan. And I just -- I -- that's, frankly, not true. I mean, if you borrow so much on your credit card, for instance, and you go to your credit card company and say, hey, I want to borrow more, and they say, no, that doesn't mean that you default.

ED

10:55:24
You keep making your payments. You just don't get to borrow anymore. And that's, you know, that's all I really have to say. I really dislike how everybody is equating not raising the debt ceiling and default. And it...

REHM

10:55:36
Laura.

MECKLER

10:55:37
But in order to pay our ongoing obligations to send Social Security checks out...

REHM

10:55:43
Right.

MECKLER

10:55:44
...to pay government workers, to pay interest on bonds that's owed to all sorts of people, in order to do all the things that the government does every month, we don't have enough money coming in. So if you -- in order to do that, we need to borrow more. So, you know, you could -- the problem is a lot of this -- he may be suggesting, and there have actually been some who have suggested this -- yes, just pay the interest on the bond and just stop all other government services.

MECKLER

10:56:11
Meaning, no one gets Social Security checks, no Medicare doctors get reimbursed. You know, we just sort of stop paying the TSA. Maybe that would make Ron Paul happy, you know...

REHM

10:56:18
How likely do you think that is...

MECKLER

10:56:20
I think...

REHM

10:56:21
...to happen?

MECKLER

10:56:21
I think it's virtually impossible.

DICKERSON

10:56:25
Because -- and the reason it's impossible and the reason they'll work to get a deal is that even if you could do the math and arrange things in such a way as Laura describes, that might solve the math problem for the moment, but the market reaction to that would be catastrophic. And that's what they're worried about.

MECKLER

10:56:41
Right.

REHM

10:56:41
Well, let's hope they all come to the White House this weekend ready and willing to negotiate in honesty and fairness. John Dickerson of slate.com and CBS, Laura Meckler of The Wall Street Journal, Dan Lothian of CNN. Happy Friday. Have a good weekend. Thanks for listening, all. I'm Diane Rehm.

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10:57:11
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