The economy including Home Mortgage refinancing and the permanent end to congressional control over the debt ceiling. In return, president obama is offering republicans 400 billion in entitlement cuts over ten years. Still to be negotiated. Mr. Obama also wants emergency Unemployment Benefits and a temporary payroll tax holiday extended along with the Infrastructure Spending and mortgage relief, the price tag for the president s stimulus bill could rise to 50 billion or more. After meeting with secretary geithner, Speaker Boehner said he didnt see any sign of compromise from the white house. First despite the claims that the president supports a balanced approach, the democrats have yet to get serious about real spending cuts. And secondly, no substantive progress has been made in the talks between the white house and the house over the last two weeks. Eliot no sooner had boehner finished then Senate Majority leader harry reid took the podium to challenge republicans to come up with their own plan. Were saying extend the tax cuts for middle class. As part of that, of course, we know if we do nothing that top rates go up and the nats are waiting for the republicans to come forward with something because thats our proposal, period. Eliot on the debt ceiling Speaker Boehner retreated to the position that g. O. P. Held last year. If were going to talk about the debt limit in this, theres going to be some price tag associated with it. I continue to believe that any increase in the debt limit has to be accompanied by spending reductions that meet or exceed it. Eliot White House Press secretary jay carney didnt think much of that idea. Asking for a political price to be paid in order for congress to do its job to ensure that the United States of america pays its bills and does not default for the first time in its history is deeply irresponsible. Eliot despite boehner rejecting the president s proposal, Democratic Leaders seem to expect the g. O. P. To cave at least on raising marginal tax rates on the wealthiest 2 of all tax iers. Chuck schumer was all but gleeful as he analyzed the g. O. P. s position. Theyre not going to openly concede on this point this far out from the deadline. But they see the handwriting on the wall. Eliot for more on the fiscal cliff negotiations and todays confrontation, lets go to Michael Tomasky political correspondent. Michael, this constitutes high drama by washington standards. Any surprise that the president s proposal was outright rejected by Speaker Boehner . It was an in your face proposal to him. It was. Im not surprised. I dont think any of us are surprised it was rejected. I think were a little surprised, maybe a lot surprised it was put forward in the first place. This is really different. Barack obama, this is a really different negotiating posture and position that he is starting from. If we look back to that horrible debt ceiling fiasco from last summer in 2011, i think we all remember how bleak that was that obama started his negotiating position really from a place that met the republicans more than halfway so he was going to be bound to end up meeting them in the final analysis. Which is what happened. It was demoralizing. Now, after reelection, he has been obviously very embowdenned. Hes put forth something it is clear they wont accept it. They wont wake up tomorrow morning and think they want more stimulus spending. This is a strong move. Eliot it is exactly right. Really, the president is almost moving away from the republicans because the stimulus package which he put into this, the tim geithner took up to the hill today has not been part of the conversation so far. Hes almost saying look, guys, weve got a jobs crisis. Youre all talking about an austerity crisis. Im shifting the debate. I want to stimulate the economy. This adds a new dimension to it. He gave his back of the hand to boehners for the debt this is a rejuvenated president adding things to the table, not taking them off. It is pretty amazing. Adding stimulus to the table means exactly what you just said eliot. It means emphasizing jobs and growth instead of deficit reduction. Thats something thats going to make liberals in washington extremely happy and the whole package including this debt ceiling, getting rid of congresss authority over the debt ceiling is something it is just politically strong. It is going to make his voters feel emboldened. Theyre going to give them something to rally around instead of a discussion on numbers and how much are we going to give to entitlements. He said to his base and to his voters who just reelected him by a reasonably handy margin, weve got something to fight for here. Eliot i dont want to go off on the conversation exclusively about the debt ceiling but hes right about saying to congress you pass the spending bills you pass the taxing bills therefore when we hit the debt ceiling, it is merely carrying out your own legislation. I shouldnt need to go back to you to fund the debt plus there is the constitutional argument. Hes saying to john boehner im taking your leverage home with me. Hes right about it. I dont think the house will ever go for it. But it is the way things should be, dont you think . He should have done it the last time, he should have done it in 2011. A lot of us wrote it and wondered why he wasnt doing this then but at least hes doing it now and yes this is exactly the right way to play it. The congress has increased the debt limit i forget the exact number, i think it is 73 times in american history. And never never until last year was it held hostage to other demands or filibustered by the senate which it was both of those things last year. So hes coming back and saying no no, im not going to play the game that way anymore. Eliot thats exactly right. We still dont have any clarity to switch over to what the republicans are asking for or what their proposal would look like. There are three different ways they could agree to raise revenue. You can cap deductions for individuals and mitt romney debate idea, eliminate specific loopholes or raise marginal rates. Any indication which of those three they might support and if there are enough votes within their conference on the house side to vote for any of those ideas . Hard to say. Theyre not saying very much specific as you justre certainly not saying much specific about what they want in return for increased revenues. What exact entitlement cuts they want. They may be saying something privately but theyre not saying anything publicly. You know i think that obama obviously wants the marginal rates increased. Hes really kind of drawing a line in the sand on that. A few republicans tom cole is the most notable one but a couple more today, i noticed came out and said they think their party should consider that. If we get a drip, drip, drip on that, a few a day a few a week, then maybe maybe there will be a chance by the end of december that enough republicans will go for that increase. Remember, it doesnt have to be a huge number of republicans. It just has to be 25 or so of them. Eliot the president has drawn a couple lines in the sand. One of them is marginal rates go up. Another one now appears to be the debt ceiling. Hes putting himself into a position where hes going to have to tow a tough line or disappoint the very people you said earlier hes making feel very good because of the toughness and the new vigor in his negotiating position. Fun game to watch michael. Well ask you to come back in the next couple of days to tell us who is winning and losing. Great. Always a pleasure. Eliot newsweek correspondent Michael Tomasky thanks, as always for your time tonight. Thank you. Eliot a provocative column in the New York Times this week suggests even if democrats succeed in raising marginal tax rates, the top 2 , it wont be enough to reduce income inequality. Economic columnist edward toe porter argues a broader flatter tax may be necessary to fully fund a range of social programs that would make the u. S. A more Equitable Society for all. For more, it is a pleasure to welcome back to the program edward toe porter, author of the price of everything. Welcome back. Hey, thanks for having me. Eliot this was a fascinating and almost counterintuitive argument. We fought this political battle, we thought so we could raise the marginal rates on the rich because that would make an Equitable Society. Youre saying it wont work. It wont because it wont raise enough money. Once you see progressive tax rates, they are a tool basically and what im proposing is one of the important goals is theyre to reduce inequality. To reduce inequality, the experience of a bunch of other countries, you really need money. The progressive tax system that we have even thor it is more progressive than that does not really raise that much. Eliot one of the points you make in the article is our tax system is more progressive but even with and perhaps almost because it is more progressive we have a narrower base and therefore, the sheer size and volume of the money we raise isnt enough. Well, thats right. Because the progressive tax rates, they encourage all sorts of tax evasion tax be avoidance and you know, they alter peoples behavior in order to reduce their tax liability. So you know instead of investing here, youll invest in some other country with a lower tax rate. Youve had those kind of behaviors which would be narrow and progressive tax rates. Hence, the money that you raise at the end of the day is not very much. Eliot you raise and sharpen our focus on the other side of the equation. As i was reading the article i said wait a minute, were focusing so much on how we raise the money rather than how and where we spend it. And how much we spend. In a way weve been sucked into this debate about making a tax system progressive without looking as you say we should at how much we spend on the social programs that actually do redistribute. Thats right. Thats what really makes a difference. If you look at how effective taxes are at reducing inequality, theyre really not very effective anywhere. Whats really effective is spending. Because you know, you can really if you have money, you can spend on programs to alleviate poverty on programs to help kids. You know. Thats what if you look across the board, you know western europe, australia new zealand, canada, most of the redistribution comes from the spending side. Eliot in fact, our government as a percentage of gdp is smaller than most of those countries. Every one of them. Our total taxes are about a quarter of gdp. Thats ten points less than most of the rest of them. Eliot the conclusion you reach is that maybe it would be better if you voted for have a flat tax. In other words buy conservative argument. I hate to mar it with that prejudice. Have a flat tax. Give us a broader base. Then because you could raise a lot more, kind of but well spend a lot more on antipoverty programs. Perhaps i wouldnt go as far as having a flat tax because our income inequality is so intense there is a very good case of trying to tax the very rich but i do think the flatter tax would be very useful. Eliot the problem we have politically here in the u. S. Of course is there is this fundamental aversion to the size of government, to a big government. And what youre suggesting is that we need different scale of government. We need a bigger government that actually is willing to spend more on the antipoverty programs. Emotionally, the public doesnt want that. Even Warren Buffett recently said we shouldnt spend more than 21 of gdp. Youre saying we should be spending more than that. Well, yes. If you decide that income inequality is a problem and more and more economists are coming to that conclusion that it is hurting our growth. It createless all sorts of what we need to combat it in a way, to create a more level Playing Field in terms of equality of opportunity. That requires money. So rather than reducing entitlements, you have to think of well, what are other ways it could help workers adapt. All of these things require funds. Eliot our federal government as representative of gdp has been about 15 . Thats right. Eliot which is staggeringly low. Thats right. It is wray low. You hear the conversation in washington, there is a lot of bringing it back to the historical average about 18. 5 of the economy. But that is still very low compared to pretty much everywhere else in the world. Every other advanced country in the world. Eliot what i hear you saying is that even if the president gets everything he wants, even if we go all the way to revenue that gets us to 18 19 and the government spends 21 , we wont resolve our fundamental problem of inequality. I think that we will not yes. I think there is a certain thing that if we get to 19 of gdp 18. 5 of gdp were still going to have to do a lot of cutting of entitlements. The idea of creating new programs to assist workers whacked by more technology or competition from abroad, there arent going to be funds to address the issues. Eliot the problem gets worse and worse because of demographics as we ang and healthcare costs increase. Thats why we have aging and a more and more competitive economy. Eliot i guess what i should have said at the time is the article is provocative but gloomy. I have been called eeyore. Eliot i wont call you eeyore. I thought the article was fascinating. We have to reframe our debate. I think the article suggests how we should do it. Eduardoporter, thank you for coming back on the show. Thank you. Eliot a new constitution in egypt and a seat at the table for palestine. Mints called mints . Answer in a moment. Eliot when news first broke the makers of twinkies were going out of business, too many people assumed it was the same old story. Union workers demanding exorbitant wages. Lets take a look at what the management at hostess has been up to over the last few years. Theyve sold the Company Three times since the 1980s each time losing assets and picking up debt. Leading to two bankruptcy filings in the last ten years. The ceos salary was tripled earlier this year. Now as a parting shot, they just gave us our number of the day. 1. 8 million. Thats how much hostess wants to pay just in bonuses to 19 of their top executives. On average, each executive would get nearly 100,000 on top of their normal salary to help wind down a company that failed under their watch. But theres no point in picking on hostess. This kind of mentality has become common. The average pay for an american ceo went up 15 last year and 28 the year before. Even as real wages for most americans continue on a 40year drop, somehow this has become the normal way of doing business. Science and republicans do not mix. Now its your turn at the only online forum with a direct line to eliot spitzer. Join the debate now. Eliot today on the 65th anniversary of the u. N. Vote that created the state of israel, the u. N. Officially recognized the state of palestine by a vote of 138 to 9 with 41 countries abstaining and the u. S. Voting in opposition. Palestine status at the u. N. Was upgraded to that of nonmember observer state. While they still be only be able to own proceedings, this allows palestine to apply for membership in other international organizations. Something both israel and the United States had hoped to avoid. Meanwhile in egypt for the seventh day in a row protestors marched in Tahrir Square to have the Constitutional Assembly begin voting on a new constitution. Yets Egypt Supreme Court announced that on sunday, it would decide whether or not to dissolve the Constitutional Assembly so voting was accelerated to perhaps render moot sundays decision. Many of whom are boycotting what they perceive to be a process hijacked by the Muslim Brotherhood. Joining. Me is James Jeffrey former u. S. America west arena bass der to iraq. He served as the deputy to the president. Thank you for your time. Maybe you can unwind the chaos that is the middle east these days. Thank you very much for having me here, eliot. First of all, behind the chaos are fundamental changes that manifest themselves first in things like the u. N. Vote which follows the fighting in gaza over the past week between israel, the past two weeks between israel and hamas and also the arab spring in its manifestation again in the developments we see in egypt. It is very, very important for us to try to get a handle on these things because of the importance of this region and the key role that the United States should and must continue to play. Nobody can replace us in leading that region and in trying to find some way out of this chaos. Eliot you begin specifically with the u. N. Vote. Does that help or hurt . Does it make more or less likely the possibility of reigniting genuine peace negotiations . Does it help the Palestinian Authority and abbas by reestablishing his credibility as an individual with whom israel can and must negotiate or is this just some continuing unfolding of jockeying that leads us nowhere in particular . It is a symbolic vote as you said. There is much jockeying in the u. N. General assembly. That is not where peace will be decided in the middle east. On the other hand, it is popular opinion around the world is slipping away. It also is a sign of confidence in abu in abbas because of fears that the hamas group which is much more radical and rejects recognizing israel, rejects the state of israel, may be gaining ground around the palestinians and in the region so it is important to bolster him. I think thats one reason why so many states voted for this resolution. Eliot i think there has been something i hate to use the word consensus but certainly there is a strain of thought that netanyahu has missed the strain of thought to turn abbas into a genuine partner for peace and hamas as you just said has risen in the eyes of certainly the palestinians and many of the nations in the middle east. What should netanyahu do to extend the olive branch, if anything to abbas to say wait a minute, the two of us are going to be the peacemakers. Lets begin the process . Both sides have agreed that direct negotiations between the two for two state solution is the way forward. Since the end of the 1990s there has been a broad outline of how such an agreement could be achieved. At one time or another neither side or both sides are unwilling to take these steps. That includes not only the israelis but also the palestinians. So what im hoping for and what were all hoping for here in washington is not only this development but far more important, such as the extraordinary situation in syria and the continued pressure of the International Community on iran to get and encourage these two forces, the israelis and the palestinians to sit down finally and to work out a solution. Eliot the role of president morsi in egypt in helping and nudging forward the negotiation between hamas and israel during the fighting in gaza got him kudos around the world. Now theres chaos there. Nobody knows apparently what this constitution will look like. What is your sense . Will it be a constitution that is secular . That preserves Civil Liberties that is something we can look at and say egypt is now a democracy. We can embrace or will this be a shift in the other direction . First of all, eliot, egypt is a democracy today. President morsi was elected. But it is a democracy the way we see a democracy in the middle east. I experienced that in turkey under Prime Ministerrered wine and iraq under Prime Minister maliki. Both come from religious movements. Both represent partially religious parties. Well see this against both represent the question is right now the battle is being fought out over the constitution. The role of pluralism. The role of tolerance. We have to see we have to await the outcome but i was encouraged by the fact that president morsi had to back step a little bit based upon the popular protests we saw breaking out all over egypt in the past week. This is a leader who must respond to popular protest and thats a mark of a democratic system. Eliot it is indeed. It was fascinating to see Tahrir Square occupied by secular voices, not the Muslim Brotherhood saying to president morsi, were with you but you must respect our Civil Liberties and maintain some framework of a secular nation. How about the judicial officers who had been appointed by mubarak . Will they survive this, do you think or are they a relic of the past . Im hesitant to call anybody a relic of the past. I will say what weve seen in all of these similar situations is a movement away from institutions and personalities who prosper under the regime, if you will. Again, these people represent one very important stream of belief and stream of political feeling in egypt. The muslim brothers and president morsi represent another. Our Founding Fathers decided that it would be important to separate religion and the state even though most of them were themselves personally religious because of the problems in democracy, if you have a different system. Well have to see how it works out in egypt. Eliot ambassador James Jeffrey, thank you for shedding light on what is a chaotic region right now. Thank you for joining us. Thank you eliot. Eliot is christian its religion . Not so says fox news. Eliot can the senate be saved from itself . First, conan obrien on obama newest appointment and the west place to go on location. Then doesnt fit anywhere else, we put it in the viewfinder. The fbi says demand for new firearms was so high on black friday, it had a little trouble keeping up with all of the background checks required. Anna is live from randolph, new jersey with more on that story. [ gunfire ] good morning. [ gunfire ] seriously, mitt romney is going to meet president obama at the white house and after three weeks of dealing with the benghazi scandal and the fiscal cliff, obama is prepared to offer romney a position in the administration, president of the United States. [ laughter ] youve been warned, harry reid take away Mitch Mcconnells filibuster and he will strike back by obstructing everything you do or let him keep the filibuster so he can obstruct everything you do [ gunfire ] still to come, an easy recipe perfect for entertaining. Also the reason why the latest royal visit was extra special. For the douche duke and duchess of cambridge. Are you crying . Because the cooker because the workers wont make my muffins anymore. What religion is involved with christmas . What religion . Christianity. Thats not a religion. Thats a philosophy. Okay. Dont tell me what i think. When i said i didnt have a problem, i dont have a problem. Got it . Give the people their billions. Lets move on. I feel sorry for those people who won because now theyre part of the 1 . They will be demonized. What im wearing here and the long rifles and some are Breast Cancer awareness. John, back to you. Anna koiman live at a gun range in new jersey. Interesting. Eliot before the next senate does anything else, they should fix the filibuster. Thats where tots come from. [ male announcer ] the capital one cash rewards card gives you 1 cash back on every purchase plus a 50 annual bonus on the cash you earn. Its the card for people who like more cash. 50 more spy stuff. Whats in your wallet . This car is too small. The Natural Energy of peanuts and delicious, soft caramel. To fill you up and keep you moving, whatever your moves. Payday. Fill up and go but whether hes climbing everest, scuba diving the Great Barrier reef with sharks or jumping into the market he goes with people he trusts, which is why he trades with a company that doesnt nickel and dime him with hidden fees. So he can worry about other things like what the market is doing and being ready, no matter what happens which isnt rocket science. Its just common sense from td ameritrade. Eliot it was once described as democracys finest hour. Decades ago before mr. Smith left washington. Today the filibuster has become the procedural weapon of choice in obstructionism, notably for the republican authority who has blocked legislation to nominations, more than 360 times. Between 2009 and 2010, more filibusters were used than in the 50s, 60s and 70s combined. Senate majority leader har rye reid along with his newly reelected democratic majority are leading the push for filibuster reform. Efforts supported by a coalition of progressive organizations calling itself fix the senate now. Being led by the Brennan Center and common cause among others. Joining me is the president of common cause and former sixterm congressman from pennsylvania, bob edgar. Were joined by Michael Waldman president of the Brennan Center for justice. Thank you for your leading this worthwhile crusade against obstructionism in the senate. Congressman, let me begin with you. Harry reids reforms are pretty thin soup compared to what might be done. They say to filibuster, you have to be actually on the floor. It reduces the number of hours before you can actually break a filibuster and it says you cant filibuster initiation of consideration rather than closure to end it. Why are there not 67 votes for that sort of thin reform package . Well, eliot, there are actually three options and as you say leader reid has the most modest proposal to change the rules and allow for the filibuster to be weakened but not done away with. There is another coalition that michael and i are part of that is trying on the first legislative day to have a filibuster that looks more like Jimmy Stewarts filibuster back in 1939 when mr. Smith goes to washington. It is interesting to note that in 1939, there were zero filibusters and in the last few years, as youve said, several hundred filibusters have blocked everything. Common cause is concerned about it because Something Like the disclosure legislation pushing back on Citizens United got 59 votes in the United States senate to fully disclose money and politics. It failed. The more radical position which common cause is pursuing, if, in fact, harry reids process doesnt work, if, in fact, on the first legislative day by a majority of the senate, were not able to change the rules we think thats a viable option. But if it doesnt work, we believe we can prove in the courts that the filibusters actually unconstitutional. It was eliot i hope youre right about that. I think thats a tough argument. Well get to that in a minute. Before we get to that constitutional challenge in the courts, which is the heaviest i want to ask you, do you think that majority leader reid will use what is called the Nuclear Option of using 51 senators to break the filibuster rule on the first legislative day come january. I hope he will. He says he will. But thats one of the Big Questions that people are asking as they watch this play out. In the past, the filibuster was in an older version of the senate where basically it depended on more comity between the parties. It depended on unspoken agreements that things could be worked out. Now youve got this very hyperpartisan senate and this old rule which had its problems even then. Has become a tool for a complete minority veto of all legislation. If you look at the press, if you look at the newspapers, people have slipped into saying this bill or that bill didnt get thus 60 votes required. It isnt 60 votes required. So under the regular senate rules, it takes 67 votes. But on the first minute of the first hour of the first day of the legislative session they havent started those rules yet. And so this is called some of it is called the constitutional option. Thats when you get 51 votes. Harry reid wouldnt do it last time. But now hes so fed up, he says eliot last time, they crafted some meaningless compromise. Now i hope hes learned a lesson the compromise was meaningless and hell use the 51. Congressman, back to you, i, too, along with michael read the constitution. I never saw the number 60 in there which is the magic number. Are there even 51 democratic votes for the Nuclear Option . I know that sounds like it should be a silly question but there are a lot of Democratic Senators who were stuck in the gridlock mentality. Do you think harry reid could get the 51 votes on the first day . I think there is a better shot at that this year than two years ago when we tried it. There are some newer senators who have come on board and in their campaign, senators from maine and massachusetts and across the country who have increased the number of Democratic Senators who have said yes lets come on that first day and lets try to fix it. And Work Together on this. So i think harry reid has a stronger position today than he had even five months ago four months ago. I want to see some courage out of the leadership there in the senate. Because i believe that the next four years will be very difficult if every issue has to have super majority vote. Eliot i think well know on the first day whether the Senate Leadership has the backbone to force this through and if they dont, were going to have the gridlock weve seen for the past couple of years. I also want to see michael another aspect of filibuster reform which is the areas out of the filibuster rule such as president ial nominations. Judicial and otherwise. Where it seems to me the senate role is meant to be circumscribed, should not have a supermajority. Is there thought to saying judicial nominations 51 is all you need . In this particular round i dont think people are looking at that. Youre exactly right. It isnt just great issues of constitutional import like civil rights which we all think of the segregationists leaving the floor book on the floor of the senate to hold the bills up. They were pretty big bills but now every single nomination, whether its for a judgeship or for the assistant secretary of commerce is filibustered in effect and held up and on average now, it takes 188 days for a judge to be confirmed. You have a judicial emergency all over the country with not enough judges. Ill say i actually think there is an argument to be made that you want more consensus on judicial nominations perhaps than not because theyre for lifetime but these everyday appointments, budget bills routine bills this isnt about deliberation, the worlds greatest deliberative body. It is about someone finding a tool and using it to gum things up and it is time to change the tool. Eliot fascinating Counter Point about the judicial nomination. I hadnt thought about it that way. Congressman, i want to come back to you for the last question, unfortunately. You have this lawsuit pending which says the filibuster itself is inherently unconstitutional. Quickly explain your reasoning on that. Well, the senate has the right to set its own rules but the courts have pushed back time and again and said to the senate you have that right but your rules cant be unconstitutional. The filibuster was invented by aaron burr 20 years after the constitution. It was used more often to protect slavery and lynching laws and we believe that we can prove in a court of law that the Founding Fathers who were so smart they put six instances in the constitution for a supermajority vote. You cant impeach the president. You cant have a trade bill. You cant amend the constitution. Without a supermajority. But if you read the federalist papers and english commonlaw, it is clear that they were fearful that on every issue you needed a supermajority. In 1965, medicare passed. Most people like medicare. Had 55 votes. If it came before the senate before, it would fail. Eliot i gotta one very quick thing the healthcare legislation was watered down time and again by the use of the filibuster and they kept making it weaker and weaker and weaker because they needed 60 votes to even consider it. Eliot not that it matters but if i were a judge, i would say the fact of the constitution specifies where you do need a supermajority implicitly says you dont therefore fill buster is not constitutional. I did not know that about aaron burr. He both gave us the filibuster and dueling as a way to resolve disputes. The guy has extensive process clearly not what ours is. Bob edgar ceo of common cause. Michael waldman president of Brennan Center for justice. Thank you for joining us tonight. Another teenager senselessly gunned down in florida raising questions again about the scope of the stand your ground law. Eliot a detailed report on corruption within the murdoch media empire and what must be done about it. Thats next. But later join Jennifer Granholm in the war room for more on the socalled fiscal cliff with laura tyson congresswoman Donna Edwards at 10 00 p. M. Eastern in the war room. More viewpoint coming right up. Questions, of course, need to be answered. We will not settle for the easy answers