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In the Arena
Boehner to Rewrite Debt Bill; On the Brink of a Crisis; Taking It to the Limit
Aired July 26, 2011 - 20:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
GLORIA BORGER, CNN ANCHOR: Good evening. And welcome to the program. I'm Gloria Borger.
Tonight as we move still closer to national default, you can see the countdown clock right here on the screen. Take a look. Just over six days and three hours.
Americans are sending a message to their elected representatives. We are mad as hell. For those of you too young to remember that's a line from a great 1970s movie called "Network."
(BEGIN VIDEO CLIP)
PETER FINCH, "THE NETWORK": I want you to get up eight now and go to the window, open it, stick your head out and yell, I'm as mad as hell and I'm not going to take this anymore.
(END OF VIDEO CLIP)
BORGER: Now that sounds like how a lot of people feel these days. This time, instead of the late actor Peter Finch, it was President Barack Obama who told people to take action.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I'm asking you all to make your voice heard. If you want a balanced approach to reducing the deficit, let your member of Congress know. If you believe we can solve this problem through compromise, send that message.
(END OF VIDEO CLIP)
BORGER: And so they did. Today more than 100 congressional Web sites crashed or threatened to. Phones rang off the hook and letters and e-mails poured in. But once again, the same old posturing went on and on.
We've all seen this movie before. In fact, we've been watching it for weeks now. I'll have a lot more on this story in just a moment. But first, here's a look at the top stories I'll be telling but tonight.
(BEGIN VIDEO CLIP) BORGER: Let's say it's August 3rd. Democrats and Republicans cannot cut a deal. The debt ceiling is falling down. So what's the first bill the United States government decides not to pay?
Then again, money can't buy happiness. Really? A new study out says wealth and depression go together. For countries as well as people. Dr. Gail Saltz asks, who are the real haves and have-nots?
And Norway. A desperate text message. As the killer stalked an island full of kids, a terrified parent kept in touch with her child. A heart-stopping conversation.
(END OF VIDEO CLIP)
BORGER: And now for more on our top story, the giant showdown in Washington over the debt ceiling. Republicans and Democrats each waiting for the other guy to blink.
I want to go first to CNN congressional correspondent Kate Bolduan who is on Capitol Hill tonight with some breaking news.
Kate, all eyes have been on Speaker Boehner's proposal today. There seems to be a hiccup tonight and he's got to rewrite his plan. What's going on?
KATE BOLDUAN, CNN CONGRESSIONAL CORRESPONDENT: It's all about the money, Gloria. This has to do with the issue of savings. As you'll remember one of the principles that Speaker Boehner said he was going to abide by when coming up with this plan was that the cuts. The savings had to be greater than the amount that the debt ceiling would be increased.
That's a problem this evening. Because debt ceiling increase according to this bill would be about $900 billion. And the CBO, the Congressional Budget Office, they always come out with cost estimates for legislation. And they just came out to say that his savings, the deficit reduction in this bill, fall short of what he targeted.
Only $850 billion in deficit reduction as opposed to the $1.2 trillion that they were targeting. A big problem tonight, they're now scrambling to rewrite the bill and it's unclear what's really going to happen tomorrow. And especially they were spending all day today trying to sell the bill to their members, Gloria. Not only rewriting it.
(CROSSTALK)
BORGER: Well, so what happens? OK, Kate, so what happens? We weren't sure he had the votes before to pass it in the House. Now it looks even less likely, right?
BOLDUAN: Definitely seems like more problems or more headaches added to the speaker's plate at the very least. Unclear, really. I mean, what we were told as this was happening was that they were still aiming for a vote tomorrow. Unclear if that's still happening. There's still -- they're working right now to try to figure out what their options are. Definitely you could -- it's very easy to understand that it would be even a bigger problem selling this to House conservative who were already complaining that this bill didn't go far enough to control spending and bring -- and put in place as a cost saving measure.
BORGER: Yes. And clearly, Kate, the speaker does not want to lose. So thank you very much.
BOLDUAN: Exactly.
BORGER: And stay on top of that story. It's important.
And meanwhile tonight, we're getting some mixed messages out of the White House, too. Just a short time ago on CNN, White House communications director Dan Pfeiffer told our Jessica Yellin that President Obama would entertain a short-term deal to raise the debt ceiling.
That would give lawmakers extra time to reach a larger deal. But when I spoke to White House budget director Jack Lew earlier today, he kind of dodged that question. So take a listen.
(BEGIN VIDEOTAPE)
BORGER: Jack Lew, thanks so much for being with us. Is there a possibility, Jack, that you do you a patch of, say, a week or two- extension in the -- in the debt ceiling so that these bills can work their way and you can come up with a different kind of deal? Is that possible?
JACOB LEW, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET: You know, I don't want to look at the different hypotheticals because there's time for Congress to get its work done. The right thing to do is for them to do it.
(CROSSTALK)
BORGER: But they say they can't.
LEW: Well, I think they can.
BORGER: Say they can't?
LEW: They can and they should.
BORGER: OK. Well, let me -- let me talk to you about what would happen if they didn't get a deal. Today, White House communications director Dan Pfeiffer said this to CBS Radio. I want to you listen to it if you can. I know you're outside and there is a bit of a demonstration going on across the street about immigration. But try and listen to this.
(BEGIN VIDEO CLIP) DAN PFEIFFER, WHITE HOUSE COMMUNICATIONS DIRECTOR: We are seven days away from an unprecedented financial event in this country's history. One that could potentially put us back -- put us towards a depression because the House Republicans led by Speaker Boehner are unwilling to compromise one inch.
(END OF VIDEO CLIP)
BORGER: So do you think House Republicans are leading the country towards a potential depression?
LEW: I think that we are seeing a very uncompromising position. We're seeing a -- you know, my way or the highway approach.
The president has tried to compromise. He's done it in a series of negotiations. I want to point out we remain engaged after the majority leader walked away. After the speaker walked away. And the speaker walked away a -- a second time.
So I think the president has made clear, he's anxious to look for the reasonable compromise where we can agree. I think we need to see some movement on the other side. There's time for that movement. And --
BORGER: What? OK. What would movement -- give me a -- I know you don't lake hypotheticals. What would movement be? What would you consider movement?
LEW: I think if you look at the bill that Senator Reid put in in the Senate, he's outlined a path where it does give the speaker what he's asked for. Dollar for dollar, cuts for increases in the debt limit.
It's a path, it's open and available. And it offers an opportunity to reach agreement. I think that we can't be in a place -- you know the bill --
BORGER: It has no taxes.
LEW: It has no taxes. And you know we've made clear that if we were talking about the long-term deficit reduction bill to solve our problem for the next 10 years, it would have to be a balanced package. But what Senator Reid put forward was I thought an attempt to reach a hand across, to make a compromise. It was to accept the principle that the speaker said he needed.
You can't get everything your way. There has something you give.
BORGER: Well, let me play to you exactly something Senator Mitch McConnell, the Republican leader in the Senate, said today, because he may be the man who finds the way out of this. Listen to what he said.
(BEGIN VIDEO CLIP)
SEN. MITCH MCCONNELL (R), MINORITY LEADER: We're going to have to get back together and get a solution here. We cannot get a perfect solution from my point of view controlling only the House of Representatives. So I'm prepared to accept something less than perfect because perfect is not achievable.
(END OF VIDEO CLIP)
BORGER: So --
LEW: Well, that doesn't sound so different from what I just said a minute ago.
BORGER: Well, that's what I was just going to say. If it were up to you and Senator McConnell, and maybe John Boehner, it sounds like you could cut a deal. But you do have House Republicans that you have to deal. They're not going to vote for Senator Reid's plan. Right?
LEW: So, you know, I think --
BORGER: So --
LEW: If you look at the House, there are Democrats as well as Republicans in the House. It's been clear from the very beginning that if there were a big agreement, there'd be a need for Democratic votes. It may turn out that even for something small there's a need for Democratic votes.
But you know that gets back to you've got to compromise. You can't reject the principles that the other side says are important. We think it would be terrible for the economy to have this be a nine, 10, 12-month long period of chaos. So we can't have kick the can down the road six or nine months.
We can't accept a framework that puts us in a place where six or nine months from now, draconian cuts would be required that we don't agree to.
BORGER: You know, given the state of play and given the fact that so far you've spent weeks doing this to no avail and you've got seven days left, is it inevitable that the U.S. credit rating would be downgraded under any circumstance because we could be back at this or because the deficit reduction won't be large enough?
I mean what's the chance? What percentage would you -- would you be able --
(CROSSTALK)
LEW: I don't want to speculate on that. I read the same papers that come from the rating agencies that all of you read. And what's clear is that they're making two points. One, they're making the point that dysfunctional government is a bad thing. The notion that we can't extend the debt limit and avoid a financial crisis is something they worry deeply about.
They also are worried, as are we, that we need to be on path for real deficit reduction. The plan that gets us through these next few days will not be the final answer on solving our long-term deficit problems. It could point us in a constructive direction. It could be a down payment.
I think that the more we show an ability to find agreement in a reasonable middle, the more we will calm all of those, not just the ratings agencies but the American people who are worried about our government being able to work.
BORGER: And I have to ask you this question. Because in the event that you don't reach a deal, and that you do reach a deadline, in which we can't pay our bills, how do you at OMB and the Treasury Department -- how do you plan for failure? Who -- how do you decide who gets their checks -- who gets checks and who doesn't get checks?
LEW: Well, our plan is for the debt limit to be extended and for this not to come about. That's the only responsible way for this to end.
(CROSSTALK)
BORGER: But you're obviously planning. You're obviously doing contingency.
LEW: We will be prepared -- we will be prepared to deal with whatever situation arises but our plan is for this to be resolved.
BORGER: So you're not going to tell me if the Social Security checks will go out and veterans' benefits will go out? And --
LEW: There is no -- there is no way that anyone can give assurances that we will make timely payments in a situation like that to Social Security recipients, to veterans, to contractors. The president said that last night.
There is no way to assure that all of those payments would be made were we to fail to reach an agreement on raising the debt limit. The truth is we can borrow 40 cents on the dollar. If we don't have the ability to borrow, we don't have the ability to pay.
BORGER: And on that sad note we're going to have to leave it.
Thanks, Jack Lew, so much for being with us. And let's see if you guys can get this worked out by August 2nd.
LEW: Good to be with you, Gloria.
(END VIDEOTAPE)
BORGER: As you just heard, the White House is backing the Democrats' plan put out by Harry Reid. The Republican leadership under John Boehner put out their own plan. But as of tonight, they're rewriting it. And we don't know if it's going to pass tomorrow. If it comes up on the floor tomorrow.
Joining me now is Congressman Tim Huelskamp, who was going to vote against his own speaker's plan. Thanks so much for being with us. What's going on in the House? John Boehner's plan? The Congressional Budget Office says you know what? It's not going to save as much money as we thought, under $1 trillion. So now he's got to rewrite it?
You weren't going to vote for it in the first place. Is it going to pass?
REP. TIM HUELSKAMP (R), HOUSE REPUBLICAN STUDY COMMITTEE: Well, we'll find out. That's one thing about the House. At least we have a vote. You know the Senate hasn't had a vote. They haven't passed a budget in 815 days. The president has ideas but nothing down on papers. And you know we'll have a vote tomorrow. I don't know if it passes or not. But what we need to see is a long-time workable solution like cut, cap and balance which has passed the House.
BORGER: But that's not going anywhere. Cut, cap and balance passed the House. It's not going to pass --
HUELSKAMP: Harry Reid is afraid to bring it up for a vote. I mean, bring it up for a vote, Harry. Why are you so afraid of letting people -- that's what happened in the Senate. That's what frustrates me as a freshman. These folks aren't taking any votes.
And Harry Reid's proposal might not pass. I have a letter from four senators that say, hey, that's not going to pass over there either. So they need to have a full open debate in the Senate about the budget and about the future of our country.
BORGER: But you heard what Jack Lew was saying. You heard what Mitch McConnell was saying, which was essentially, you can't have everything you want.
Tax increases, Congressman, are now off the table. So what is it you need to raise the debt ceiling?
HUELSKAMP: Well, it's what America needs. None of these plans actually ever balance the budget. They don't plant on doing that. The only balanced budget --
BORGER: But in six days we're not going to balance the budget.
HUELSKAMP: No, we're not. But in six days or longer, the reports came out today. It's really not six days. It might be longer. We don't know. We asked the Treasury Department to provide us numbers. They refused to provide us numbers. But --
BORGER: Jack Lew said it is August 2nd.
HUELSKAMP: But the Treasury Department has the number. We called his office. He says, well, we don't know. Call the Treasury Department. But I don't want to argue about that. But the point being we need a long-term solution. That's what S&P and Moody's said. They said it's not about just raising the debt ceiling. It's about showing a workable, long-term solution. And when we're spending 42 -- borrowing 42 cents out of every dollar we spend, it's a major, major problem. And we need to focus on that. And I'm glad Washington is finally looking closely at the problem. It's a spending problem and hopefully we'll pass something that would deal with the problem.
BORGER: Well, but here's the question. You have six days left. You know how Washington works. Nothing is going to get done that's big in six days. Would you be amenable to passing something shorter, say, for a week, two weeks, a month, whatever, getting you through so that you can come to a larger deal? Would you vote for a short-term increase then?
HUELSKAMP: You know I think the House has done its work. It's cut, cap and balance. I would consider something like that if Harry Reid would actually let senators actually be senators and have a debate on that. That's the problem. I go home and people say, have you passed something? Yes. We've passed two budgets this year and the Senate hasn't passed --
(CROSSTALK)
BORGER: But it's not just you. It's not just you.
HUELSKAMP: Exactly.
BORGER: It's the entire Congress. So say you've done your job. Let's stipulate that. Fine. What do you say to people who say, we cannot let this country go into default? It's embarrassing and worse than that, it's devastating for the American economy and for your constituents.
HUELSKAMP: Yes. In the last year I've hosted the 64 town halls. And they frankly didn't want the debt ceiling to be raised at all. But cut, cap and balance with immediate spending cuts -- caps in the future and a balanced budget amendment, actually we passed that an increase in --
(CROSSTALK)
BORGER: Wait. I know that. I know that but --
HUELSKAMP: And the Senate hasn't even had a vote yet. That's frustrating. I think it's incumbent upon the Senate to actually have a vote.
BORGER: So are you worried about default? Are you worried?
HUELSKAMP: I am worried that the president might choose a default. That the president might choose not to pay Social Security.
BORGER: So you're going to say I had nothing to do with this. If the country goes over the cliff, you're going to say not my fault?
HUELSKAMP: The country shouldn't go over a cliff. The question is this. Can we solve the problem? We -- under the president's budget that he proposed in January -- that's the only budget he has -- there's $10 trillion in new debt. All they're talking about is reducing that by about 10 percent. We still need -- we still have $9 trillion in new debt.
That still doesn't solve the problem. What's the long-term solution? Does the budget ever balance?
BORGER: So -- OK. Well, if it happens then it's not your fall. That's what you're going to say. So --
HUELSKAMP: Well, the president said --
BORGER: It's -- you're going to blame President Obama. OK. You're going to blame President Obama --
(CROSSTALK)
HUELSKAMP: Well, the president is the executive officer of this nation.
BORGER: OK. Well --
HUELSKAMP: When he said on national television nine days ago that he may not send out the Social Security checks, there seems to be plenty of evidence. We even had outside analysis today reported by three different groups that there's enough money to go another week. So that's fear mongering.
BORGER: Well, we have to see.
HUELSKAMP: Well, we shall see.
BORGER: OK. Congressman --
HUELSKAMP: But I would ask the Department of Treasury to release their numbers so we know exactly what they intend to do and what the case is for future of the nation.
BORGER: Congressman Huelskamp, thanks so much for being with us.
HUELSKAMP: Thank you. You bet.
BORGER: I appreciate it.
And coming up, what if we don't get a deal as we were just talking about? And the debt ceiling deadline passes? With so many bills to pay, the government would have to make some painful choices. We'll tell you who will feel the pain.
(COMMERCIAL BREAK)
BORGER: If the debt ceiling is not raised, the U.S. Treasury will have to make some very tough spending choices. And lots of people will put in their two cents worth on what the priorities should be.
Is it military salaries? Is it Social Security checks? And what about those air traffic controllers? Or guards in federal prisons?
Tom Foreman is here to help us figure out all the answers.
Tom, how do we make these choices? They're so tough.
TOM FOREMAN, CNN ANCHOR: Well, here's the simple part of it, Gloria.
You can pay for any of this. You just can't pay for all of it. Not under this scenario.
Let's look at the nuts and bolts of this before anything else. This was last August, this is the current August. This is how much revenue we have coming in, $172 billion. This is how much we're spending, $306 billion. So it's $134 billion that we won't have.
So Congresswoman Borger, let's put it to you.
BORGER: Yes.
FOREMAN: Let's put it to you.
BORGER: Yes.
FOREMAN: Look at our options here for the month of August.
BORGER: I've got them.
FOREMAN: If we don't have that borrowed money, we have to spend just what we take it, what do you want to pay for here? Interests? Social Security? Medicare and Medicaid? What do you want?
BORGER: OK. OK. Well, I'm a member of Congress now. I prefer you call me senator, Tom.
FOREMAN: Well, we'll see how you do as a congressman. Go ahead.
(LAUGHTER)
BORGER: OK. We've got to do the interest, of course.
FOREMAN: Interests?
BORGER: Social Security, Medicare, Medicaid. Everything.
FOREMAN: OK. Social Security, Medicare and Medicaid. All right. So you've spent this much, $128 billion. Here's where you are.
BORGER: Right.
FOREMAN: Here's your default line. What else do you want to pay for?
BORGER: Well, I think obviously we need to pay our military active duty pay. FOREMAN: Our military active duty, all the people who are in Iraq and Afghanistan. That's actually not so much. $3 billion. The people all around the world. So you're doing OK. What else?
BORGER: We have to take care of unemployment insurance?
FOREMAN: Unemployment insurance. All those people who are struggling out there.
BORGER: Right.
FOREMAN: You know they must be taken care of. That's $13 billion. Low cost. What else do you want to pay for? Tuition maybe?
BORGER: We have to pay veterans -- well, we have to pay veterans benefits.
FOREMAN: Veterans benefit.
BORGER: We have to take care of our veterans.
FOREMAN: We're taking care of our veterans. That's $3 billion more. What about -- hey, you can't forget your federal salaries here.
BORGER: I'm not.
FOREMAN: All those people who make the government run. How are you going to do without those?
BORGER: Of course.
FOREMAN: Can we throw those in?
BORGER: But where am I going to see that --
FOREMAN: All right. All right, Congresswoman. We put those in. $14 billion. How much else? What else do you want to pay for here?
(CROSSTALK)
BORGER: OK. I've got it. You've got it. People who get IRS refunds.
FOREMAN: IRS refunds.
BORGER: What about those people?
FOREMAN: Seventy-seven percent of the country gets IRS refunds. We've got to take care of those people. You're almost there. What else do you want here because you've got some responsibilities --
BORGER: Tuition assistance. Education. Education.
FOREMAN: Tuition assistance. All those young people are going to need jobs. Look at this. You're already over. You're over here. And now, you know what? I just showed up at your door. I'm an advocate for the poor in this country. People who are struggling.
BORGER: Right.
FOREMAN: And I'm telling you if you don't put in food and nutrition services in these bad times, you're in big trouble.
BORGER: Housing.
FOREMAN: So which one are you going to take off here?
BORGER: Well, I think --
(CROSSTALK)
FOREMAN: IRS refunds, because you know what? It's not April right now.
BORGER: OK.
FOREMAN: We'll take that off. So that's gone. So now I'm going to give you food and nutrition services. Look at that. You're over again.
This is the problem. If you look at this, Congresswoman, no matter what you do, if you knock out the defense vendors here, look at how many people, $32 billion.
BORGER: Right.
FOREMAN: Well, you know what? I have to kill this and this and this and this and this to get the defense spenders. But guess what? The defense spenders, that's a tremendous number of jobs in this country.
BORGER: Right.
FOREMAN: If you don't pay for those, Congresswoman, that's a bunch of jobless people who are going to have more struggles.
This is the fundamental problem for everybody in Congress right now. All of your colleagues, and I'm telling you, if you don't do a better job --
BORGER: Which is --
FOREMAN: -- with this, you'll never be a senator.
BORGER: OK. So you're talking about the larger programs here.
FOREMAN: Right.
BORGER: And it's easy to talk in generalities, Tom.
FOREMAN: Sure.
BORGER: Because that's what people are talking in terms of these days. But what about if you're the member of Congress and you're going home and you have to tell your constituents exactly what this is going to mean for them and their pocketbook and their piggy bank.
FOREMAN: Exactly. Exactly.
BORGER: How do you -- how do you explain that?
FOREMAN: All right. So Congresswoman Borger, you go home to your district and you meet the happy family. And you noticed they're not as happy as they normally are. Why? Because when you apply all of those cuts that you might have to look at -- these are things you have to make those tough choices on. You're going to find some tough thing.
Here's one of the first things you find out. If we go into default, interest rates are going to rise. That's one of the predictions. And credit restrictions will be greater. So if they're trying to buy a house or do anything that has to do with interest, which is an awful lot of things, they're going to see some different costs.
They're going to find that the products they're buying, cars or stereos or iPads, or whatever it is, that those could very well be more expensive. Because all those companies are having to pay more interests. And because they have to pay more interest, they have to have somebody else pay for it.
So they're going to put it into their product. They won't have any choice.
Individually, though, look at these constituents of yours. What about mom over here in the family? Let's say that mom is a government employee. Well, she very well could wind up being furloughed if you don't pay for those people if you make those choices. Or she could also see her credit card rates rise as part of this. That's going to affect how she runs her house.
What about dad over here? He's a small businessman. He could wind up unemployed if he works for a small business or somebody else who says, I just can't afford all of this. He could be losing money in his 401(k) because of all these wild things happening with interest rates. A difficult time getting a loan and on and on it goes here.
The daughter here is in the military. She could have a -- a delay in her salary. Private contractors could be laid off. The son is trying to go to school. He could find his student loans very hard to obtain. And of course, as you were talking about a moment ago, grandma could have her Social Security delayed.
This is the whole problem, no matter what you pay for, something else doesn't get paid for if the debt ceiling stays where it is.
BORGER: Tom, thanks so much. That's great information. Something we all need to know. And that's why I'd like to be a senator because I only have to run every six years as opposed to every two and making those tough choices. FOREMAN: Good point.
BORGER: Thanks so much.
And coming up, Norway is in mourning. As more information emerges about the man who took so many innocent lives. A chilling portrait of a killer and the country he scarred forever.
(COMMERCIAL BREAK)
BORGER: In Norway today, thousands of mourners gathered with roses at Oslo City Hall for a vigil and a march in memory of the 76 victims of Friday's massacre.
Meanwhile, a picture emerged of the suspected attacker. Anders Breivik, as a cold and detached person. Breivik's lawyers says his actions appear to be, quote, "insane," and that during the attacks, Breivik used drugs to keep himself, quote, "strong, efficient and awake."
In an interview on Norwegian television, Breivik's father who asked to remain anonymous repudiated his son in the strongest possible way.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE (Through Translator): No, I'll never have more contact with him. In my darkest moments, I think that rather than killing all those people, he should have taken his own life.
(END OF VIDEO CLIP)
BORGER: Absolutely tragic. And CNN's senior correspondent Nic Robertson was on site at Breivik's farm today as police detonated what was left of his explosives.
He joins me now from Norway. Welcome. Nic, what do we know about the attacker today that we didn't know a couple of days ago?
NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, I think we've got a sort of a deeper insight to him through his lawyer because this is the first time we've had a chance to talk to his lawyers. His lawyers met with him on three occasions and he said for several hours.
Perhaps the thing that struck me most, talking to the lawyer today was when he described his own sort of assessment or watching him try to give an assessment. He said that he never met anyone like this before.
You could really see this articulate man struggling for words to describe this person who is now defending. And when he said that, you know, he is insane, what he was meaning there, this is a man who couldn't be sane if he carried out the acts that he did.
But he did say he was going to have to wait for this sort of clinical analysis. We've heard that Breivik is tired now that he is in jail. That he didn't expect to get away with this. That he expected to be shot by the police. He expected to be tortured when he was in custody, but is also ready to pay the price.
He said he knows that people will hate him for what he's done. But this is something that he believed he had to do. He is holding out against the police in two key areas right now, one of those is that he says there are two other terror cells that support him in Norway and others in the rest of the world.
And he won't tell police about them and he also won't tell police about amounts of fertilizer that could be used in bomb making that the police are trying to track down. So on the one hand, he wants to talk. On the other hand, he is sort of playing this game of stringing the police out and keeping himself in the limelight.
BORGER: Do the police believe him, Nick, when he says that there are two other terror cells? That he was working with or do they think he is just lying to them?
ROBERTSON: They don't really know. I spoke today to the head of Norway's intelligence here and she told me that she believed that this is Breivik trying to stay in the limelight. This is what she described part of his magic by stringing the police along, by creating the impression that there are other cells, other bombs perhaps out there.
But at the same time, one of her senior analysts told me, the director of the sort of threat assessment told me that they just have to take what he is saying and check it thoroughly. On the one hand, they don't want to believe them to a degree.
On the other hand, they say they have to check it out because the reality is, if there are other people out there, there are more explosives, this is really, really dangerous and they can't afford to take any chances. So that's their real concern here.
BORGER: But, you know, the police are coming under some citizen criticism too. As you say Breivik himself believed that he wouldn't get away with it, but he did manage to pull this off. The police did not stop him on an extended shooting spree.
ROBERTSON: Yes, there are two things here that I think people are asking questions about. The immediate one, how could he continue the shooting spree for an hour and a half when television camera crews and others were able to rent helicopters in nearby Oslo and fly to the scene.
And the police helicopter wasn't available, apparently, because the crew wasn't there, apparently because they were on holiday. The police couldn't fight, take care of an incident in Oslo and the other situation.
But the other question is how could he get away with all of this? How could he buy explosive fertilizer? Have sophisticated weapons systems, buy chemicals and bring them into the country. The intelligence services say the reason he was able to do that was because he did everything by the law.
He got a handgun almost a decade ago and took several years before he bought another weapon. That he got a smaller amount of something they won't say it is what, $15 from Poland. He did everything legally and very carefully, intentionally not to get caught. So that seems to be the defense of the intelligence services. He wasn't breaking the law.
BORGER: Yes, and it is obviously something that he had been thinking about for an awfully long time. Nic Robertson in Norway, thank you for being with us.
Still ahead, can you call it a debate when the two sides talk at each other and not to each other? I'll ask our political panel. With the president going on TV and the speaker of the House taking his turn, is anybody actually trying to get a real deal done? We'll talk about it in a minute.
(COMMERCIAL BREAK)
BORGER: There is breaking news tonight on the debt crisis. CNN has just learned that the vote on Speaker of the House John Boehner's proposal to raise the debt ceiling has been postponed. This after the Congressional Budget Office just announced his plan cuts less than he said it would.
Joining me now are men for both sides of the aisle. They can certainly talk about this. Democratic consultant James Carville and former Republican Congressman Rick Lazio. Welcome, gentlemen.
OK, it looks like we've got some trouble here for the House Speaker tried to sell this to his troops, couldn't sell it. Then the CBO comes out and says you're not saving us much money as you thought you were.
Let me go to you first, Rick Lazio. So, what does this mean for House Republicans?
RICK LAZIO (R), FORMER U.S. CONGRESSMAN: It only means it is delayed. The vote will be delayed for a day. Hopefully not longer than that while the Congressional Budget Office rescores or re- estimates whatever new offerings the House comes up with.
They've promised to come up with least a trillion dollars in savings. As I understand it, CBO, the Congressional Budget Office, came back with about $850 billion. So there are $150 billion plus or minus short.
So they have to come up with a couple of additional pieces of savings, but they should still be on track to have a vote by Thursday or Friday at the latest.
BORGER: Well, you know, a day matters, every day matters. But James, let me put this to you. I mean, it now looks like the Democratic plan, Harry Reid's plan cuts an awful lot more than the Republican plan, John Boehner's plan, and it doesn't include tax increases. So haven't the Republicans won, why didn't they declare victory and just go home?
JAMES CARVILLE, CNN POLITICAL ANALYST: I don't know. There is nobody for the Democrats to surrender to. They've been trying to get on the right flag and it keep running away from them. I thought that the speaker's plan was $2 trillion, $2.1 trillion. I thought his pledge was that he would cut as much as they were raising the debt limit. I didn't know it was a trillion. Don't hold me to it. But I thought it was supposed to be $2.1 trillion in cuts.
LAZIO: It's 2 trillion I think, as I understood it.
BORGER: Let's not use that word. We have to have a moratorium on that.
LAZIO: Two phases, one supposedly about $1 trillion, $1.2 trillion and second one was a panel that I think Harry Reid has also propose, by the way, that had would save another $1.8 trillion so a total of $3 trillion was the overall goal.
BORGER: Well, let me just -- I want to play you guys something. I spoke with Senator Kent Conrad early today, Democrat, chairman of the House Budget Committee, member of the gang of six, on the deficit commission. He wants a grand deal.
And the question is, of course, whether you can possibly get that or anywhere near that in the next seven days. It looks very unlikely. I want you to listen to what he said. And James, why don't you come out of it?
(BEGIN VIDEO CLIP)
SENATOR KENT CONRAD (D), BUDGET COMMITTEE CHAIRMAN: We're not going to get a grand deal in seven days, but you know, we could get an agreement on a process going forward to secure a grand deal. That's what is really required. I would hope that at the end of the day here, we would adopt something that would get us through the immediate short term crunch. Get it past the debt extension crisis.
BORGER: Are you talking to the White House about this possibility?
CONRAD: Certainly I am. Look, the House is going to have to decide if they're going to try to do this all on the Republican side of the aisle or are they going to recognize.
The only way they're going to get a plan that can carry in the Senate and be a balanced plan is that they do it with Democratic votes in the House and Republican votes.
This idea that they're just going to do it all by themselves on the Republican side of the ledger means that they are locked into a formula that cannot possibly solve the problem.
(END VIDEO CLIP)
BORGER: So James, is he right? CARVILLE: Yes, in a word. But I think what's happening here, it strikes me as, the speaker who I think is a decent guy. They're trying to get something through the House.
Then Senator Reid will try to get something through the senate. Then they can get something to like conference committee. Then make they can strike something there. They have to get two thing will sort of pass that they can work from here.
And you know, the public is turning to this quickly and I think the folks are feeling a lot of the heat. And there is nothing that can motivate a group of politicians, apparently based on our reporting and what I've seen today. A lot of it is coming in.
BORGER: Well, you know, let me ask you that, Rick Lazio. Because I just spoke with a freshman member of Congress who said, we Republicans, we voted for it in the House. We've done our job and was blaming Barack Obama. Will that last if the nation actually defaults and people don't get their Social Security checks?
LAZIO: Well, listen, I don't see that happening. I think that you're going to see that probably what James has laid out. The Senate will move, and maybe in fact, Harry Reid and Boehner will come up with a single offering on both sides, which would be better yet. Republicans would be better off --
BORGER: How would they do that? Wait a minute. How would Harry Reid and Boehner come up with a single offering?
LAZIO: Right now, they're not so far apart. Both sides agree that they can't get a bill passed with taxes so that's off the table. Only the president doesn't understand that.
The second thing is they both have to understand they to get more savings than the amount of the hike in the federal debt limit. So there are the parameters of some agreement out there. They're not so far apart that they can't come together.
I'm more hopeful with what hard Harry Reid has done and said. I think the harsh rhetoric and the name calling and the points frankly president made during his national address didn't really help people to come together and get an agreement.
I'm hoping behind the scenes you'll see a little more constructive dialogue and that you will actually get a good outcome. A good outcome is not a trillion or $2 trillion in savings. A good outcome is to address this in a long term manner.
Republicans to have real eye, they can't get the whole thing done in six days. They're going to have to live with something less than what they really want and live to fight another day to get more savings.
BORGER: OK, James. Go ahead.
CARVILLE: Apparently, Senator Conrad is someone else who doesn't think it can be done without something on the revenue side. Be that as it may, politically, this is not bad for the Democrats. It is terrible for Republicans.
They're destroying their brand over there and I think they know that. I think that the speaker and Senator Reid and people understand that this has to get resolved. If they get it to some point, I think they can push enough to avoid the default.
And then come back and maybe deal with it another day. I know the president and a lot of people say we need to get this resolved prior to the election year, 2012. That is a noble goal, but I'm kind of skeptical they'll be able to do that.
BORGER: James, you don't think this is bad for Barack Obama?
CARVILLE: It might be a little bit, but it is just awful for the Republican brand. Look at our poll. I mean, just yesterday, everyone that comes in, it gets worse and worse.
It strikes me the position is deteriorating. We had it at 50/30. Every poll that comes in, I mean, the public overwhelmingly blames the Republicans and with good reason. The Democrats are trying to surrender and the Republicans won't take it.
LAZIO: Those aren't the poll number I've been seeing.
CARVILLE: Which one you saw?
BORGER: Rick Lazio, people do blame so far in the polls that we've taken at CNN, people do - I mean, Barack Obama is not doing fabulously, but he's not doing as badly as Republicans.
LAZIO: His numbers continue to sink down in terms of the stewardship of the economy. The people that place blame for where we are right now. Listen, neither side looks great.
I don't think that we accomplish anything by saying one side is doing three points better than the other side themselves. Both don't look very good in all this. The bottom line is the country is facing a major fiscal crisis. It is likely to be on a path of austerity for a number of years.
We'll have to re-establish our expectations and we're going to have learn to save, work, and the government will have to live within its mean in a way that it hasn't done over the last several years under both Republican and Democratic presidents.
BORGER: OK, James, giving you the last word.
CARVILLE: First of all, it's not three points. It is like 20, 30, 40 points in some polls. Secondly, there are group of people who think it is really, really counterproductive. They have austerity in the middle of these economic times.
There are a group of people who say this is exactly the wrong thing. The president is not one of them so there is a consensus that we'll cut all of this in the middle of these economic times.
LAZIO: And some people say that Greece and Portugal and Spain should have been having this debate two or three years ago. The debate we're having right now. So a lot of people thinking it is pay me now or pay me later.
BORGER: Guys, we're worried about this country now and we're kind of on the brink of something here on August 2nd. So we will continue this debate. James Carville, Rick Lazio, thanks so much for being with us. Great discussion as always.
Coming up, that great political analyst. Was she a senior political analyst May West once said, I've been rich. I've been poor. Believe me, rich is better. That's hard to argue.
But a new study says when it comes to a nation's happiest, maybe richer isn't better.
(COMMERCIAL BREAK)
BORGER: Money can't buy you love. What about happiness? Well, according to a new study, it looks like that's out, too. The report from the World Health Organization shows that people in rich countries like the U.S. are more prone to depression than those in poorer countries like India or Mexico.
In face to face interviews with nearly 90,000 people around the world, researchers found that on average, 15 percent of those in wealthier nations have suffered depression at some point in their lives. That's versus just 11 percent in lower income countries.
Here with more on the study is psychiatrist Dr. Gail Saltz. Welcome, Dr. Saltz. Can you tell me why people in wealthier nations seem more prone to depression?
DR. GAIL SALTZ, PSYCHIATRIST: We can only hypothesize because the study didn't look for the reasons why, but I think a few things we could conjecture are that in poorer nations, first of all, it is more typical to turn to family.
In fact, if you think about it, in poorer nations, families often live together in close circles. They do a lot of the childcare. They do a lot of the marital advice. And we know that actually, close family and social supports are protective against depression.
Additionally in poorer nations, often people are more turning to religion, spirituality. That also is viewed as protective against depression. And on the contrary side, in terms of more affluent nations, there are greater expectations. In this country, there is a great disparity of wealth.
Yes, we are over all a wealthy country, but we look at some people being very wealthy. Others are not doing so well and yet, they have the same expectation of doing well. So there is a lot of stress in the disappointment, quite frankly, that people suffer. BORGER: Could it also be that we just talk about depression more in this country? That it is something that is not frowned upon? It is considered something that is treatable. It is considered pretty routine, actually.
SALTZ: I would say actually it is a flaw in the study, in a sense of that they asked people about their depressive symptoms. Well, first of all, they asked retrospectively. So they asked you to think back over the past whether you thought you had these symptoms.
That's already a problem because people don't remember necessarily the same or they might not, in some nations where they're not as educated about mental health issues and as you pointed out, where it more stigmatized.
They might not report that they were depressed because one, they might not know or two, they might not want to tell someone from a foreign country that they felt these symptoms. So that is problem.
BORGER: What about different age groups, also? Are older people more likely to be depressed, younger people more likely to be depressed?
SALTZ: Again, that could vary from country to country. And it depends on, I think, frankly how older people are treated and how younger people are treated.
When countries where to be older is to be revered, to be treated as wise, as an important person in the community, that is less stressful than for instance, in this country where as we know we all struggle with the it's better to be younger, such a youth-based culture.
People who are older often feel put out to pasture and at the same time, today at least, they're not assured that they will be taken care of in any sort of way. That's very stressful.
BORGER: Is there any comparison? Kind of over, you know, five years, 10 years, whatever because the economy is bad everywhere in the world and why isn't that reflected in every country? The economy is bad here, but it's bad in Greece. One could say it's worse in Greece, right?
SALTZ: As much as the economy and stress of that is affecting people, and certainly it does, but depression is a much more complicated illness than just that than just one stressor. We know that being stressors in trauma can precipitate a depression in somebody who is already biologically predisposed to that.
But we know that there are genetics involved. In some ways it is a biological illness. That is not the full picture. So we see rates of depression don't necessarily change hugely depending on the economy.
Because as I said, there are other factors involved that really stay the same. I think what we should think about the study is really that when you look at the rates, they're really quite substantial whether you're talking about a poor country or a rich country.
That says to me that we really need to do more to educate people about the treatments that are available when they have the symptoms and when they really do need to seek treatment because depression has a real mortality rate attached to it.
BORGER: And learn to recognize the symptoms. Thank you so much, Gail Saltz.
SALTZ: My pleasure.
BORGER: Thanks for being with us.
Up next, what parents fear most. A child in terrible danger and there is absolutely nothing you can do. For one mother and daughter in Norway, the cell phone was their life line, literally. That when we come back.
(COMMERCIAL BREAK)
BORGER: Turning back to the tragic events in Norway. Norwegian media and the BBC today published an extraordinary exchange of text messages between a mother and daughter. Julie Bremnis (ph), a 16- year-old girl, pinned down by the shooting on the island of Utoya frantically texted her horrified mother, Marian.
At 5:42 in the afternoon, as reports of the shootings first emerge in the Norwegian press, here is Julie's first text. Julie's mother quickly responds. Moments later, the mother received another text from her daughter. Then at 6:30, there is this exchange and finally, at 7:01, Marian writes this.
After a long search, Marian Bremnis finally got a call from Julie, safe and on her way home. That's it for us tonight. Thanks so much for joining us "IN THE ARENA." I'm Gloria Borger. Good night from Washington. And Piers Morgan starts right now.
