COOPER ON INSIDE POLITICS WITH PAT NOLAN
Inside Politics 12/9/11
Nolan: Today our guest is Congressman Jim Cooper from here in Nashville. Congressman, thank you for coming in, as always.
Cooper: Thank you, Pat. Always good to be with you.
Nolan: You know, every time we talk, it seems like Congress has reached a new low in its job performance, and now I think it has again. It's down in single digits. So what is it - they're smart people in Washington and in Congress - what is it about them not understanding that doing the same thing over and over again is not going to get a different result?
Cooper: Well you're right, Pat. Congress has reached a new low. Now, I'm doing all I can to reform Congress to make it do better, but there are enough of my colleagues there who just want to have partisan food fights. They just want to bicker all the time, and they're not putting the interests of the country first. I think that's deeply unpatriotic on their part, but they haven't been persuaded yet to act like adults.
Nolan: At this point, are you expecting to have to spend probably almost the whole month of December up there trying to - there are so many fiscal issues that Congress has to address.
Cooper: Congress has so far delayed so much of the important work of Congress, and done a lot of frivolous stuff instead, that we may well be voting until Christmas Eve. I'm hoping to get a few days off between Christmas and New Years, but it's ridiculous how they've delayed the essential actions.
Nolan: Now, a lot of that delay was because people were waiting for the super committee to come up with a plan that was going to deal with, over a ten year period, the deficit and the budget situation. Of course, that committee failed. Were you really surprised given the makeup of that committee?
Cooper: Well, I never want to be too cynical, but once again Washington proved the deepest cynical correct. Because when the committee was set up with six hardcore partisans of each party - six hardcore democrats, six hardcore republicans - it's going to be very difficult to get anything other than a stalemate, and that's in fact what happened.
Nolan: Well, part of the stalemate that's different this time is you have these automatic cuts that are supposed to take effect. Now they won't take effect until I suppose October of this coming year when the 2013 fiscal year kicks in.
Some of those are pretty tough. You're particularly concerned, I understand, about the military cuts.
Cooper: Well, you're right. Many people expected the super committee would fail, so there was a fail safe mechanism, a backup plan. These are across the board cuts. They're called sequestration, but almost half of those cuts come from one area of the budget, which is the Defense Department. Now, we need to do a lot of cutting in defense, but we can do nothing that would endanger American security.
Nolan: Well I understand these cuts in terms of their size are actually smaller than the cuts that were experienced by the military after the end of the Cold War, so why can't the Defense Department take care of those?
Cooper: Well, the Defense Department is already planning on cutting over the next ten years $450 billion. These automatic cuts would be on top of that, so you're looking more like at a trillion, trillion and a half dollars so we're probably going to have to have a new military strategy for America in order to accommodate cuts of that size.
Nolan: We also have a situation where there are going to be cuts potentially in Medicare or Medicaid coming up. Now you were quoted in a radio interview that you did with Nashville Public Radio in town that you were ok with that, even though Nashville is a pretty big healthcare industry. You're talking - come of your constituents are going to get hurt by that.
Cooper: Well, I think a lot of the reporter's message was not necessarily clear. Under these across the board cuts, healthcare is largely protected. Medicaid, for example, is completely protected, that's the program for the poor. And Medicare is limited to the smallest possible cut, which is about two percent. So that's actually a much better outcome for healthcare than probably would have happened under the super committee if they had been able to reach some sort of agreement. So built into the across the board cuts was a protection for healthcare programs.
Nolan: Do you expect these across the board cuts to be in any way changed? I thought I heard President Obama say he was going to veto any change to avoid these automatic cuts.
Cooper: The president has said that. That's a pretty strong statement on his part. The across the board cuts don't really take effect - it's not really next October - they really don't take effect until January 2013. And that's going to be a new Congress.
Nolan: Doesn't the fiscal year for that year begin in October?
Cooper: You're exactly right. The fiscal year begins in October, but this formula is jiggered by politicians to be a little bit tricky. So it doesn't really start until January 2013. So the calendar is very important in this debate.
Nolan: That would be after the 2012 election, wouldn't it? Just by chance.
Cooper: Exactly. New Congress and possibly new president. So, I wish congressmen in Washington would be more honest. Many of my colleagues are not being sincere with the voters back home. I've always been a straightforward guy, and I think voters deserve to know the truth. And the real problem is here - every day we delay solving these problems, they get more expensive to solve.
Nolan: This last year - what we were going to do about the debt ceiling - there was all of this concern about what was going to happen to the credit rating of the company. And that was one of the reasons the super committee was put together. There was all this concern about whether we were going to be downgraded - much as we've seen all across Europe. We've had this failure with the super committee yet nothing has happened. Did we misunderstand that? Were we misled about what we were really facing in terms of this country's credit rating being at risk?
Cooper: You make an excellent point, Pat. We, in fact, beat ourselves up more than the rest of the world has beat us up. Because when they look around the world, they look at America as the beacon of hope, and that's why they invested more money in this country after the ratings downgrade than they had beforehand. So instead of our interest rates going up, as many people expected, our interest rates actually went down.
Nolan: We are in an international economy. What we do in this country - while it may be important, it may still be the most important country in the world economically - what goes on in Europe and in other places is important too. We have this crisis going on in Europe and what used to be called the European common market and what's going to happen with their currency, the Euro. Tell me - is there anything this country can do about that? Because this alone could take us back to another recession.
Cooper: You're exactly right, Pat. The world is more interconnected than it's ever been. It's not just the internet, it's trading relationships. And if Europe gets a bad cold, we could well end up with pneumonia here. So put it in perspective: when Lehman Brothers failed, two or three years ago, that was a big shock to the American economy and to the world economy and that was about a $500 billion problem. But already, what we've seen from Greece, and Italy, and Spain, that's a $4 trillion problem, so it's already eight times larger. And we really need to be worried about this financial earthquake.
Nolan: And there's not much the U.S. can do about that, right?
Cooper: You're exactly right. Now, the Europeans, just yesterday, got together and decided they were going to try to solve their own problems, and I hope they have the guts to do that. So far, Europe has been a loose confederation. It is not a united states of Europe. There's no fiscal discipline there. They're not able to take a country like Greece or Italy and say, "shape up. Do right." But this looks like they're getting more force behind that to make them behave as a group. Now England has separated itself out of that. They've always been not only off the shore of Europe, but different in attitude. It's going to be interesting to see whether the Europeans can hold together.