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STATE OF THE UNION WITH CANDY CROWLEY

Interview with Congressman Hensarling; Interview with Reince Priebus; Interview with Senators Coburn, Warner; Interview with Mayor Villaraigosa

Aired November 13, 2011 - 09:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


CANDY CROWLEY, HOST: Time is running out but the debt committee is at a stand-still.

Today, ten days to find $1.2 trillion with the co-chair of the super committee, Republican congressman Jeb Hensarling, and two senators who have tried to bridge the party divide -- Democrat Mark Warner and Republican Tom Coburn.

Assessing the presidential field with Republican National Committee Chairman Reince Priebus.

And America's cities, our first installment today with Los Angeles Mayor Antonio Villaraigosa.

(BEGIN VIDEO CLIP)

MAYOR ANTONIO VILLARAIGOSA (D), LOS ANGELES: That's why we're here today. because L.A. is not waiting on Washington.

(END VIDEO CLIP)

CROWLEY: I'm Candy Crowley, and this is State of the Union.

On his way out of town Friday, President Obama called the two chairs of the super committee from Air Force One to tell them they needed to make a debt deal soon. That is not breaking news to panel members who have been spinning their wheels for nearly three months.

(BEGIN VIDEO CLIP)

REP. JEB HENSARLING (R), TEXAS: I'm not giving up hope. And I hope my Democrat colleagues aren't giving up hope until midnight on the 23rd.

(END VIDEO CLIP)

CROWLEY: But Wall Street may have given up hope. According to CNBC, half of the investors polled by Citigroup don't expect the committee to reach a deal in time.

Co-chair Jeb Hensarling joins me here in Washington in his first Sunday interview since being appointed to the committee. So we appreciate it. I want to show you one more poll here of people, "do you expect that the committee will reach its goal?" And this is a George Washington University Battleground poll and Politico.

Yes, 21 percent.

No, 69 percent.

So, you going to get this done?

HENSARLING: Well, Candy, I think it is important to note that the committee has both a goal and a duty and in many respects the duty is more important than the goal. The duty is to put forth legislation that actually addresses our long-term structural debt. Now the president himself has said that the drivers of our debt are Medicare, Medicaid and health care. Nothing else comes close.

So to me what we really have to focus on is that duty, and that is to find programs -- find a way to reform Medicare and Medicaid and our health care programs to get good retirement security and health security for our seniors at a cost that doesn't bankrupt our children.

CROWLEY: So you want structural change in those programs.

HENSARLING: Frankly, if we don't find structural change, we will fail in our duty.

Now let me focus on our goal. We have a goal of reaching $1.5 trillion of deficit reduction over ten years, but it is important to note that if that goal, for some reason, we fail in that goal, under law, there is still a $1.2 trillion of deficit reduction that will take place, albeit...

CROWLEY: There's lots of people trying to get around that saying it is too much, particularly the Defense side, to do across the board cuts.

HENSARLING: Well, it is not exactly across the board. Frankly it affects disproportionately national defense in a way that even the secretary of defense says will hollow out the national defense.

CROWLEY: But are you willing to do that.

HENSARLING: Well, hear me out. What I'm willing to do is be committed to ensuring that at least America gets that $1.2 trillion in deficit reduction that congress would have 13 months to do it in a smarter fashion.

But again what we have to focus on is that we have entitlement spending programs that are simultaneously disserving their beneficiaries are forms of rationing and driving the country bankrupt. And unless we deal with that, frankly, we will fail.

CROWLEY: But you can't -- you can't restructure Social Security, Medicare, Medicaid in ten days. You can't do it. People have been trying to restructure -- list the details of it.

You may say, OK, committees, you restructure Social Security and get this much out of it. You can you do that, you can give goals to committees but you can't restructure those things in ten days.

HENSARLING: Well, Candy, a number of plans have already been on the table. I mean Republicans put forth a plan in our House budget -- which by the way would have reduced the deficit by almost $5 trillion over what the president was proposing.

Now Democrats have rejected that plan. But there is a plan with legislative language that the Congressional Budget Office says will actually strengthen and save Medicare.

Well, Democrats rejected that. So we have gone to the Democrats and said, OK, if you don't like our plan, at least put a plan on the table. And if you don't, here's a bipartisan plan we would be willing to negotiate around, and that is the Rivlin-Domenici Medicare plan. And again details would have to be worked out, indeed you are correct, it would have to be through a two-step process.

But this is a plan, bipartisan plan, again led by Alice Rivlin, former Congressional Budget Office director, head of the OMB under President Clinton, that would also include a provision for future seniors to stay in traditional fee-for-service Medicare, but use the power of patient choice and competition to save and strengthen the program. And so we put that on the table as well.

CROWLEY: You do not sound like a man who believes you're going to get a deal in ten days.

HENSARLING: Oh, I wouldn't say that. Listen, it's been a roller coaster ride. I will say this -- I respect my Democrat colleagues. I have an excellent working relationship with Senator Patty Murray.

We haven't given up hope. But if this was easy, the president of the United States and the speaker of the House would have gotten it done themselves.

CROWLEY: So what about the revenue side? I know there's now -- what's on the table inside that committee in terms of revenue from the Republican side? Be they tax increases -- first, give me that figure. Like in terms of actual tax increases, which Democrats have said, look, you got to put some skin here in the game. How much are you all -- how far are you all willing to go in terms of tax increases?

HENSARLING: Well first, Candy, unfortunately it is not my skin, it is the skin of the American people. Tax is already going up by any measurement, nominal terms, real terms as part of the president's health care plan, expiration of tax relief.

And so we believe that, frankly, increasing tax revenues could hurt the economy but within the context of the bipartisan negotiation with Democrats, clearly they are a reality. So we put a half a trillion dollars of revenues on the table. Some of that fees, but 250 of it is what most people call static tax revenue. But that is in the context, Candy, of bringing down marginal rates of tax reform, fundamental tax reform to make the tax code fair, simpler, more competitive to create jobs.

So whatever damage would be done by $250 billion of new taxes, we think would be offset by a system that would help create jobs. And as we're dealing with the debt crisis, we don't want to make the jobs crisis even worse. So that's what has been put on the table.

CROWLEY: But it's something Democrats have rejected, as you know, it's not enough, that it's just a token amount. It brings me back to this feeling that is widely felt, that this committee is not going to be able to do that. And the net result is going to be you're going to shake the world markets.

A lot of people think there would be another downgrade in the U.S. creditworthiness from someone other than S&P which has already downgraded the U.S. credit. Is that something this committee, a burden this committee is willing to take on if you don't reach an agreement?

HENSARLING: Well, first, Candy, I hope I'm never in Washington to where I consider $250 billion the American people's money, to be token.

CROWLEY: As compared to the tax -- I'm sorry, as compared to the spending cuts, it's pretty token, you would have to admit.

CROWLEY: Well, frankly, there are no real spending cuts on the table. Let's make sure we are using the language like the American people do. All we are talking about here is slowing the rate of growth. All of these programs, by an large, are going to continue to grow, but at a pace that would become more sustainable.

Again as I said earlier, yes, we will fail unless we fundamentally do structural reform to what President Obama himself has called the main drivers of our debt -- Medicare, Medicaid and health care. They cannot grow two, three, and four times the rate of the economy.

So here's my point -- if at some point America doesn't take care of it, if we don't take care of it now, yes, we're on borrowed time. We're kicking the can down the road and that's why we should not confuse our duty to do structural reform that not only ensures that my parents -- my dad's 84, my mom's 79 -- that Medicaid's preserved for them, but it is preserved for my children who are 8 and 9 years old. That is the challenge.

CROWLEY: But you are talking tax reform, you are talking structural changes in Social Security, Medicare, and Medicaid. Those are things that you will have to kick down the road in some sense. There's talk now that you're going to have some kind of fall-back position on the committee where you would agree to a revenue level, but then send it to these various committees, to the tax committees, rewrite the tax code with these tack already things in mind.

Is that a possibility? HENSARLING: Well Candy, indeed, yes, there could be a two-step process that would hopefully give us pro-growth tax reform, which by the way, every other bipartisan effort that has said that some revenues have to be raised in this method. That is again broaden the base, historically this is how we both produce jobs and more revenues for the government.

So we Republicans, we want more revenues, we just want to raise it by growing the economy.

And then second of all, again, unless you actually solve the problem, let's not kick the can down the road. Let's solve the problem. And if Democrats don't like the plan that we had in our House Republican budget, why don't we gather around a bipartisan plan and negotiate around the Rivlin-Domenici Medicare plan that would preserve it for future generations and not impose forms of rationing that we're starting to see on our seniors now through the IPAB, the independent payment advisory board that President Obama put in his health care bill.

CROWLEY: Congressman Jeb Hensarling, we have to leave it there. But thank you so much for coming in. We appreciate it.

HENSARLING: Thank you for having me.

CROWLEY: Coming up next, two Senators who urged the super committee to, quote, go big in their deficit reduction agreement.

(COMMERCIAL BREAK)

CROWLEY: Joining me from his home state of Oklahoma, Republican Senator Tom Coburn. And here in Washington, Democratic Senator Mark Warner of Virginia. Both are members of the "gang of six."

Gentlemen, thank you both. First to you, Senator Coburn. That gang of six actually seemed to get along fairly well. We always thought they looked kind of close to some kind of debt reduction, the gang of six, three Republicans, three Democrats in the Senate, looking for a debt solution.

With that in mind, can you look at what's going on in the super committee and tell me what your level of confidence is that they're going to get something done where you all couldn't quite get it done?

SEN. TOM COBURN (R), OKLAHOMA: Oh, I think they will. I think, you know, as the time pressure builds and they get towards a deadline, I think they'll get something done. The question is will they do enough if they only do the $1.2 trillion, we're going to have to start over as soon as that's passed and find another $3 trillion or $4 trillion just to buy us five years in time -- you know, the time to work out of our problems.

CROWLEY: And, Senator Warner, if my memory is correct, I believe Senator Coburn had like an $8 trillion package where he thought he could reduce $8 trillion. What is your level of confidence here that they're going to get something done? I didn't think Congressman Hensarling sounded at all optimistic.

SEN. MARK WARNER (D), VIRGINIA: Well, listen, I'm hopeful. We're trying to root them on. We've got 45 senators now. Tom and I have helped organize this group, bipartisan senators, 100 members of the House saying if they will step up and be bold, we got their back, we'll try to give them that cover.

And as Tom has indicated, you know, we really need to be shooting for more like a $4 trillion deficit reduction plan. If there's one thing we've seen from the last few months in Europe, it is when you take these incremental steps, the market comes back and burns you time and again. At some point we're going to have to face that same kind of abyss that the Greeks faced, now the Italians are facing. And I believe we need to get ahead of it. Frankly, if the super committee doesn't come up with a result, I would go back to our gang of six. That had $4 trillion of deficit reduction. It had balance. Maybe that ought to get a vote if the super committee can't produce.

CROWLEY: And let me -- I want to -- after a committee produces a product, of course, the entire Senate and entire House has to pass it. I want to play you something Grover Norquist, who is a very influence Republican, he is the one that passed around a so-called no tax increase pledge on Capitol Hill, which got quite a bit of Republican takers.

So here's something he had to say last Sunday.

(BEGIN VIDEO CLIP)

GROVER NORQUIST, PRESIDENT, AMERICANS FOR TAX REFORM: There's not going to be a tax increase. Part of the reason is the Democrats have decided they're going to blow this process up in order to blame the Republicans for nothing happening.

(END VIDEO CLIP)

CROWLEY: So let me ask you first, Senator Coburn. Norquist says flatly there is not going to be a tax increase. In your opinion, can there be a deal if there's no tax increase anywhere?

COBURN: Well, you know, I go back to what Chairman Bernanke said. We're not going to have the big deficits in the future because people aren't going to loan us the money. And if there were 60 Tom Coburns in the Senate, there wouldn't be a tax increase.

But to get where we need to be as a country, there's going to be required some compromise. And you can call something a tax increase or you can call it a revenue increase. Most of us would rather see revenue increases by reforming the tax code.

But I would tell you that there's just as much pressure on the other side when you see the commercials on television from AARP saying you can't touch Medicare. Well, I want to tell you, we're going to touch Medicare because there's no way we can borrow the money five years from now to run Medicare the way it is today. So the question really is, is will politicians do what is best for the country or best for their party and their position? And hopefully we'll start looking to do what is best for our country.

CROWLEY: And, Senator Warner, we have heard a lot about this from both sides lately. We've had the president suggest that the Republicans are doing -- totally don't want an agreement. They don't want do what's best for this country. They're only interested in politics and defeating him.

We have Norquist here saying, listen, Democrats have decided they're going to blow this process up so that the Republicans can be blamed. We're certainly in an election cycle, but isn't that what really is holding this up, is everybody trying to get a political advantage?

WARNER: Well, I do think there's a lot of back-and-forth. And that's why, you know, Tom and I and the group of us who have spent a year-and-a-half working on this, we decided to check our Democrat and Republican hats and put our country first. And we had to make those kind of compromises.

I think that's what the vast majority of Americans want us to get. You know, there's going to need to be revenues, I believe through tax reform. There is going to need to be entitlement reform, so there is really a Medicare, a Medicaid, a Social Security program 20, 30, 40 years from now. That's going to take some changes.

And what frustrates I think a lot of us is, you know, we've got to be willing to probably make some folks mad on both ends of the political extreme. And you'll know this super committee is getting close if you hear folks on both ends of the political extreme scream the loudest, because that will show that there's actually movement being made.

CROWLEY: So, Senator Coburn, I guess what frustrates so many Americans when they look at this is that you and Senator Warner and your colleagues, four other colleagues, Republicans and Democrats on this committee, worked for a year-and-a-half and couldn't come up with anything. And yet I know you all got along and you were...

WARNER: And yet we did come up with something, Candy. That's -- I mean, I'll let Tom answer this, but we had a product. We had a product.

CROWLEY: But you had a product you couldn't sell. Right?

WARNER: We had a product that we had 40 senators say we will support that. That's more than anything else that has been put out on the table.

CROWLEY: But you need 60, Senator Coburn, in the Senate.

COBURN: Well, I think that the important thing is, had you put together what we had, a ratio of about 3 to 1, 2.7 to 1, entitlement reform and spending reductions with revenue increases, that's the sweet spot that I think you could move people in the House and the Senate to.

The question is, is will you do what's best for the country. You know, Candy, we have $30 billion a year in indirect payments, credits, subsidies, and government programs for people that are grossing $1 million or more a year.

We ought to be getting rid of that. That's $300 billion over the next 10 years. Why wouldn't we do that? Most people can come together and do that. So the question comes as, what is the motive? And you alluded to it. Is it political or is it the country? The fact is, is if you go back and look two years ago at what they were writing about Greece, it is exactly what they're writing about us today.

COBURN: And if in fact we don't make these very difficult decisions that calls on every American to come and contribute to solving the problem, then we're going to be in very serious trouble and it will come very quickly.

We can fix our problems, but we require leadership from the president and the leaders of the House and the Senate and say we're going to do this and we have not seen that, on both sides of the aisle. And that's what's so disappointing.

CROWLEY: Picking up on what Senator Coburn just said, this is from Alice Rivlin, who as you know, former CBO but was also on the national commission on fiscal responsibility. And she said in the New York Times Wednesday, "I fear the president is missing a huge opportunity for leadership at a crucial moment. The president could greatly enhance the chances of such a bargain by getting visibly involved. It is not only the right thing to do, it is his only chance of getting his jobs program."

Has the president -- we have not seen the president 's fingerprints at all on the debt commission, not much on his jobs program, though he's been out campaigning. He is now with ten days left gone overseas to attend to his commander in chief duties and leader of the free world and all of that, but should he be more involved?

WARNER: Well, I think we saw the president and the speaker try to weigh in at the end of the debt debacle in early August. It didn't end up producing a result.

CROWLEY: Right.

WARNER: And we saw the president come forward saying he would support the Gang of Six. I do think with this president, whatever he comes up with, there's going to be a series of folks that will reject that categorically just out of hand. So we've tried this congressional process. I think we need to let that play itself out. We want to be there to support it. We want that super committee to be successful, but if they're not successful we think that the Simpson-Bowles approach, and the Gang of Six, something that has got that $4 trillion number, that ought at least get a vote as well.

CROWLEY: Or be a back-stop.

Senator Warner, Senator Coburn, I have to end it here but thank you both so much for coming in. Two debates in the span of just four days. How did the Republican presidential candidates fare? We will ask a key party official, RNC chairman, Reince Priebus next.

(COMMERCIAL BREAK)

CROWLEY: Joining me here in Washington Reince Priebus, chairman of the Republican National Committee. Welcome.

REINCE PRIEBUS, RNC CHAIRMAN: Hi, how are you.

CROWLEY: Appreciate it. I'm very good, thank you.

We've heard so much about these polls that are so bad for the president at this point in terms of his approval, particularly on the economy. But I want to show our audience a different poll here. This was a CBS/New York Times poll from this week where people were asked about the policies of Republicans in congress.

69 percent of those polled -- this is all Americans -- say that the policies of the Republicans favor the rich. 9 percent said they favor the middle class. And on down the line.

Is that not a real problem for you all going in to January to have 70 percent -- almost 70 percent of the country thinking the GOP has policies that favor the rich?

PRIEBUS: Well, I mean I think both parties have perceptions that they need to battle. And certainty also not true. And I think that it is a red herring. And I think that the president is doing a full- time job of trying to play a game of class warfare.

CROWLEY: It's clearly working.

PRIEBUS: Well, here's the thing -- first of all of, of course the party doesn't favor the rich, but what the party does favor is reducing taxes on every single American out there, everyone watching. We favor reducing taxes and making sure that Washington is focused in on job creation, on cutting spending, on reducing the size of government. These are things that will spur the economy, and these are things that are cornerstone to the Republican Party.

Look, you're right, there are lots of polls. But the poll that I think matters the most in this country right now is that over 70 percent of Americans in poll after poll after poll believe two things. One, this country is on the wrong track, and number two, this president hasn't fulfilled his promises.

And obviously we've got to do a better job or, according to this poll, of portraying the fact that number one, we want you to have a job, we want every American to be making more money and we want to reduce taxes on every single American no matter what income category you fit into it. CROWLEY: But as long as you have -- right now the focus is on Capitol Hill with this debt commission. As long as you have Republicans, many of them up there saying we need to make structural changes in Medicare, Medicaid and Social Security -- and that would include cuts for some people and for providers in Medicare, as well as for patients in Medicare.

And by the way, we don't want to -- we want to lower taxes for everybody, including the rich. That is not a perception. That's a fact.

PRIEBUS: Well, because there's other ways of gaining more revenue, of course. I mean, if you put more people in to good paying jobs across the country, you have more people paying taxes which increases revenue into Washington, D.C. If you reduce capital gains, more people invest and we've seen revenues increase.

Look, we have, as you know, we are approaching a $15 trillion deficit. We have a president, under his policies, who will accumulate more debt than every single president before him combined.

Now, for those people that are watching this program right now, whether you are a Republican or a Democrat, they will agree with the fact that this government is making promises in regard to their entitlement -- in regard to our entitlement programs that it just can't keep.

So what are we going to do about it? Are we just going to make believe this isn't a problem or are we going to tackle these issues so that we can save Medicare and Social Security for generations. And I think that's what you saw Jeb talking about earlier in the program.

CROWLEY: Let me ask you about the Republican race at this point. We have seen things go up and down, Mitt Romney's always number one or number two but people floated up and down. We are now seeing a surge by Newt Gingrich. And yet we are getting the feeling there's a lot of commentary now that it is really going to be Mitt Romney when it all settles down.

You saw the debate last night. I know they're all your children and you can't pick -- you can't pick one of them, but where do you think this race is headed?

PRIEBUS: Well, I mean, honestly, I don't know who is going to come out of this primary. Here's what I think. And just to remind you and others that primaries are tough and, you know, we just came through 2010. And as you know, a lot of these Republican governors, whether it be Walker, Snyder in Michigan, Kasich, even Chris Christie in '09, they all came through, remember, very difficult primaries.

These were not cakewalks into these governors' houses. And I just happen to believe that primaries work. Look, we've got a president right now in the White House, came through a very tough primary against Hillary Clinton through the end of June before a national convention, and look, he won pretty easily. He got a 60-vote majority in the Senate, a majority -- a super majority practically in Congress. I think primaries work and I think, here's the thing, after all of it is said and done and all of this drama that goes on, we are going to have a completely unified party, because we know that this president is going to destroy this country economically if he gets re-elected.

CROWLEY: When do you think you'll have a winner and can the party afford to have this go into May and June?

PRIEBUS: Well, first of all, I think no matter what happens and no matter when it ends, we're going to be strong. I don't know when it is going to end. Obviously we have two pretty important dates. March 6th is a day when a lot of the states are going to come out. And we have winner-take-all states starting in April.

It could end before then, it could be just shortly thereafter. I can't answer that but I do know we are ready to go and we're ready to help save this country.

CROWLEY: And finally, the influence of tea party was felt quite a bit during the 2010 elections. You have a lot of folks with a lot of years in Congress, particularly in the Senate, that are now facing a possible challenge by tea party candidates in their primaries, Lugar, Snowe, Brown, Carter (sic), Wicker, all face possible tea party primaries.

Is there any role for the Republican Party to protect someone like, say, Richard Lugar, or help someone like Richard Lugar who has served the Republican Party for more than three decades or do you just totally stay away from that?

PRIEBUS: Oh, no, we appreciate the service that he has given, but we don't get involved in primaries. And I happen to believe that the tea party movement has been good for America, it has been good for our party.

CROWLEY: Lost you some Senate seats...

PRIEBUS: And -- oh, we won a whole lot of Senate seats too.

CROWLEY: ... in 2010.

PRIEBUS: I think 2010 goes down as a pretty darn good year for the Republican Party. And I think that we owe a lot of that to the tea party movement.

CROWLEY: Reince Priebus, we thank you so much for coming by.

PRIEBUS: Thank you, Candy.

CROWLEY: We hope to see you a lot in the coming years. It will be a busy one for you.

PRIEBUS: You bet. Looking forward to it. Thank you so much.

CROWLEY: Thank you so much.

PRIEBUS: You bet.

CROWLEY: Coming up, we go local on the economy. A look at our "America's Cities" series, starting in Los Angeles.

(COMMERCIAL BREAK)

CROWLEY: And now the opener in our series "America's Cities." We'll be visiting mayors of cities, large and small, gauging their struggle to create jobs. We went large for our first stop, Los Angeles, home to almost 4 million people. Antonio Villaraigosa was elected in 2005, the first Latino mayor of Los Angeles in over 130 years.

(BEGIN VIDEO CLIP)

VILLARAIGOSA: Our city not only represents America's greatest hope, we also face many of its most daunting challenges. I intend to be a mayor who confronts those challenges.

(END VIDEO CLIP)

CROWLEY: Six years later, unemployment in Los Angeles is 11.3 percent, more than 700,000 jobless Angelinos. One out of every 394 homes received a foreclosure notice in October. Next year the city is expected to post as much as $250 million in red ink.

Against this backdrop, Villaraigosa has proposed a five-point plan that includes tax breaks for businesses to lure them back into the city, and infrastructure spending like the $4.1 billion modernization of the L.A. International Airport.

It is his crown jewel, and the mayor was anxious to show it off, choosing this rooftop overlooking the massive project for our meeting. My conversation with Mayor Antonio Villaraigosa after the break.

(COMMERCIAL BREAK)

CROWLEY: Mayor Villaraigosa, thank you so much for being with us. Let's first explain what you've got going here, because we are literally on the rooftop of what you hope will be one of the jewels of your mayoral-ship.

VILLARAIGOSA: Well, this will be the gateway, the entry point, the welcoming door, if you will, to the Pacific Rim. This is the largest destination airport in the United States. And we think it's time to really do a little sprucing up here at the airport.

CROWLEY: Let me look at L.A. right now and ask you, as mayor, what's your number one problem? Pick out one for me.

VILLARAIGOSA: The biggest challenge facing us is the challenge of preparing our workers for the 21st Century, the challenge of improving our schools. And I've engaged in an effort to push reform in our schools, improving our graduation rates, our test scores, and getting our kids ready for a 21st Century economy which is predicated on intellectual capital and their ability to read and write, and importantly, to focus on math and science in a world where those subjects are so important, and where we don't have enough people graduating in those fields. CROWLEY: You have a sort of wide variety of things that you're doing to try to help create immediate jobs and set the stage for jobs of the future. It's not just this airport. It's the sidewalks and the streets of Los Angeles, you're trying to attract businesses in by proposing more cuts in city taxes for establishing business here. And I guess the question is certainly when you look at some of the business things you want to do, you sound very much like a Republican.

VILLARAIGOSA: Well, we have a five-point plan that focuses on cutting our business tax here in Los Angeles, growing more businesses, including auto dealerships, Internet companies, and the like.

Cutting red tape, that's not Democrat or Republican, that's just something that makes common sense. The government has to be more efficient. So what we've said here in L.A., that -- and I think what mayors across the country are saying -- there's not a Republican and Democratic way of fixing the economy. Yes, we've got to be more efficient, yes, we've got to cut some entitlements, yes, we've got to make sure that we're cutting red tape and the government is functioning efficiently. But we also got to invest.

You don't hear a lot of Republicans talking about investing in an infrastructure anymore. You don't hear them talking about the need to fix our bridges, our ports and our airports.

So we here in L.A. we call them like we see them. Sometimes those initiatives may look more like Republican initiatives. Oftentimes they look more like Democratic as well.

I think what the people in our country and certainly in our city are looking for are leaders that get things done, not ideologues and folks focused on orthodoxies that don't put people first.

CROWLEY: Let me ask you about Occupy L.A. 41 days they've been taking up housing on city property. How long does that last? How long will you allow that to last?

VILLARAIGOSA: One of the hallmarks here with the Occupy L.A. folks is that they've been peaceful. And we respect that. And so we're working with them and working through these issues and making some progress.

CROWLEY: How do you keep L.A. from becoming Oakland?

VILLARAIGOSA: I think here in L.A. we decided that we're going to work with these demonstrators. We recognize that they've been peaceful and here we're taking another path.

CROWLEY: Let me ask you in terms of in your capacity as president of the U.S. Conference of Mayors, by this administration, the Obama administration's own prediction, we are looking at very high unemployment through the elections. We are looking at sluggish growth -- growth, but sluggish growth. What do you see for the cities in your capacity speaking for the U.S. Conference of Mayors? What's going to happen to the economies in these cities? VILLARAIGOSA: Just so you understand who the Conference of Mayors are, we represent about 89 percent of the GDP in the country. If you just took New York, Chicago and L.A., we're roughly the size of France, about $2.5 billion economy. If you took the ten largest cities in the United States, it's roughly the GDP of China, little less, about $5 trillion, they're $5.9 trillion. We'd be the third largest country in the world.

So as the cities go, so go the nation. That's why we're here today, because L.A.'s not waiting on Washington. We recognize that there's gridlock there. We believe that they're failing in their responsibility, that they're actually committing malpractice by failing to fix this economy, by failing to respond or work with the president in as many attempts to work across the aisle on initiatives that have been supported by Democrats and Republicans both.

So what we're doing here is we're working -- we're focused on self-reliant program that creates jobs but we could augment that and accelerate that if we had a partnership with the federal government.

(END VIDEOTAPE)

CROWLEY: Coming up, more with Mayor Villaraigosa. Has President Obama kept his promise to the Latino community? And what are the president's prospects for re-election?

(BEGIN VIDEO CLIP)

VILLARAIGOSA: I think that any of the Republican candidates are going to give us a run for the money. The fact is, this is going to be a very close election. There's no question about it.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

CROWLEY: Antonio Villaraigosa is mayor of a large and overwhelmingly Democratic population, and as spokesman for America's mayors, his voice on national issues matters to Washington. We asked for his take on the nation's capital starting with the work of the super committee.

(BEGIN VIDEOTAPE)

CROWLEY: What do you most fear the super committee might do?

VILLARAIGOSA: Allow for just automatic cuts.

CROWLEY: That's your worst case scenario. Is that they did nothing and the automatic cuts came?

VILLARAIGOSA: I think the best thing to do is to make the tough decisions. We've got to address some entitlement reform. There's no question about it. It is not sustainable going into the future. CROWLEY: Social Security, Medicare, Medicaid, all of those. VILLARAIGOSA: All of that should be on the table. But we also, importantly, got to close tax loopholes and we've got to promote tax fairness.

CROWLEY: In general, from your 3,500-mile vantage point, what do you make of how Washington works?

VILLARAIGOSA: I think it's more partisan than I've ever seen. It's always been a partisan place.

CROWLEY: Do you think that the Democrats are blameless in this?

VILLARAIGOSA: No, of course not. No, no, look, they're not blameless. You know, there's too much in the way of orthodoxy. There's a failure to understand that the country's evenly divided, and when it is evenly divided in the way that it is, we've got to have a balance and we've got to have a mix, if you will.

CROWLEY: You were an early supporter of Secretary of State Hillary Clinton when she was running for the presidency. Do you sometimes look back and think she'd have been better at this?

VILLARAIGOSA: I've never been prouder to support a candidate than I was supporting Hillary Clinton, but that was the past. The fact is, President Obama ran a great campaign and he won. And under very, very difficult, difficult circumstances he's had -- he's done a great job, frankly. A yeoman's job when you think about that we've recession, that we almost went into a depression.

He's got a tough job and a tough road ahead. He'd be the first one to tell you the road ahead is not easy.

But one of the great things we have going for us is that people see the president as someone who reaches across the aisle. He tries to work with the other side. He sometimes gets criticized by his own party for doing it.

And the other great thing we have going for us, I think, is that the economy's going to start to turn around, maybe not as much as we would like, but it's going to start to turn around, and, finally, their candidates.

When you have, you know, a candidate who's been on all sides of every issue over the last few years, another candidate who can't finish his sentences and thinks that Social Security is a Ponzi scheme, and still another candidate that thinks the best way to fix the broken immigration system is to electrify a fence on the border and put crocodiles on the Rio Grande.

CROWLEY: He did say he was kidding. But let me -- let me ask you, as you size up, you don't think that Mitt Romney, for instance, would give the president a real run for this office? You don't think he's qualified to be president?

VILLARAIGOSA: I think that any of the Republican candidates are going to give us a run for the money. The fact is, this is going to be a very close election. There's no question about it. But I think everything points to President Obama getting re-elected, for the reasons that I said...

CROWLEY: Really? Simply because the numbers -- no president with the kind of numbers that even the White House expects to be having a year from now, a 9 percent unemployment rate, or at least around there, still a sluggish economy. This is a very tough environment even for a guy who hasn't somewhat alienated his base, who we all expect to come home, of course. But, nonetheless, this looks like a very tough re-election for him simply because it's going to be very hard for him to argue his record.

VILLARAIGOSA: Well -- I acknowledge it's going to be a tough road ahead. But if President Obama was relying on the numbers in past performance, he never would have been elected president. He defied the odds.

CROWLEY: So you're looking for an election miracle?

VILLARAIGOSA: I -- no, I'm looking for a re-election...

CROWLEY: Economic one?

VILLARAIGOSA: I'm looking for a re-election. I think that -- for the reasons that I just stated.

CROWLEY: Let me ask you about the Latino vote, which was in large part very Democratic in the last election. We've seen some slippage in the polls.

And I want to read you something that the president said during his campaign. "What I can guarantee is that we will have in the first year an immigration bill that I strongly support and that I'm promoting."

That hasn't happened. In fact, the president has deported a record number of undocumented workers. He sent more folks to the border for Border Patrol -- was pressure from the right -- than any other president before him, or at least to higher levels than they've been before.

So there must be some disappointment within you that immigration reform, and by that I mean, you know, comprehensive immigration reform, has not happened.

VILLARAIGOSA: Let me just say a couple things about that. First of all, President Obama doesn't have a vote in the Congress.

CROWLEY: No, but he can push something.

VILLARAIGOSA: And he has pushed immigration reform. He has supported the DREAM Act. He is unabashedly in support of fixing this broken system.

Now, having said that, I'll also acknowledge that their -- that the Secure Communities program does not work. It was fashioned to focus on serious criminals who are undocumented. We know that the vast majority of people, more than 400,000 of the 700,000 who have been arrested and are facing deportation, were not criminals, not felons. In fact, some of them were victims of domestic violence and crimes themselves.

So I don't have to agree with everything this administration is doing to support President Obama. I unqualifiably support him, but I also, you know, disagree with some of their proposals. And that's one of them.

CROWLEY: And then what's next for Antonio Villaraigosa? What do you do in 2014?

VILLARAIGOSA: You know -- you know, I'm not focused on anything except for finishing my job.

CROWLEY: But you wouldn't rule out elected politics down the line? It's not the end of your elected career?

VILLARAIGOSA: I'm operating as if it's the end of the road. But you're right; I love public service. It's an honor to be mayor. I loved being speaker of the California State Assembly and the -- I -- I'm not going to rule it out, but I'm not focused on it, either.

CROWLEY: Mayor Villaraigosa, thank you so much.

VILLARAIGOSA: Thank you, Candy.

CROWLEY: We appreciate your time.

VILLARAIGOSA: Thank you.

CROWLEY: We've got a noisy group here.

VILLARAIGOSA: Yeah, we do.

(END VIDEOTAPE)

CROWLEY: You can expect more of our "America's Cities" series in the coming months.

Up next, top stories, and then, on "Fareed Zakaria: GPS," a closer look at the threat of Iran and its pursuit of nuclear technology.

(COMMERCIAL BREAK)

CROWLEY: Time for a check of today's top stories. At the Asia Pacific Economic Cooperation Summit in Hawaii, President Obama pushed for more exports to Asia. During a meeting with China's President Hu Jintao yesterday, Obama brought up concerns about China's currency manipulation.

Italy's top political leaders are meeting today to find a replacement for former Prime Minister Silvio Berlusconi. Berlusconi resigned yesterday after Italy's parliament approved austerity measures to shore up confidence in the country's faltering economy.

Supporters of Syrian President Bashar al-Assad protested outside embassies in conflict of countries that voted to suspend Syria's membership in the Arab League. The Arab League's actions is in response to Syria's deadly crackdown on pro-democracy demonstrators.

A tense situation in Portland, Oregon, this morning between members of the Occupy movement and Portland police. The protesters defied a midnight deadline to leave public parks. There are no reports of arrests, but police surrounded the protesters.

Thank you so much for watching "State of the Union." I'm Candy Crowley in Washington. Tune in for my interview next week with former Secretary of State Condoleezza Rice, next Sunday, 9:00 a.m. Eastern and Pacific.