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House Democratic Leader Nancy Pelosi discussed the possible solutions to avoid the fiscal cliff in an interview with co-hosts Charlie Rose and Norah O’Donnell that was broadcast live today Dec. 12, 2012, on CBS THIS MORNING on the CBS Television Network (7:00 AM – 9:00 AM).

Below is the transcript of the interview:

ROSE: Where are these negotiations, because when they were bargaining over the grand bargain, you gave the President, and your caucus did, room to go in there and negotiate. He has that, I assume, again, so he can put spending cuts and entitlement cuts on the table.

PELOSI: The President knows our views, shares our values, we respect his leadership, and there’s a recognition that he may need our votes.

ROSE: But there’s no red line for you and Democrats in the House. You want the President to make a deal and lay out what he can do.

PELOSI: That is true. However, we want what happens to be fair, and we want it to be able to work. And one of the things that we object to is raising the Medicare age.

ROSE: But it’s not a red line for you.

PELOSI: Well, it is a—it’s something that says don’t go there, because it doesn’t produce money. In other words, what do we need here? We need resources, we need cuts, and we need growth. High tax cuts for the wealthy increase the deficit and do not produce jobs. Raising the minimum wage—excuse me—raising the retirement age does not get you that much money, so you’re doing a bad thing when it comes to seniors, and you’re not achieving your goal. So we’re saying does it work, is it fair, or is it just a trophy that the Republicans want to take home whether or not it achieves—contributes to reducing the deficit and creating jobs?

O’DONNELL: Leader Pelosi, I know there’s been a lot of talk about increased revenues on the Republicans’ side, but there’s also a burden on the Democrats, which is that what entitlement cuts are you willing to make? You wrote an op-ed, you said no way on raising the Medicare eligibility age. What are you willing to offer in terms of entitlement cuts to get this deal done?

PELOSI:  First of all, we already have made entitlement cuts. Republicans criticized them, but in the Affordable Care Act, we have over $700 billion in savings from Medicare, which we plowed right back into Medicare to extend its life and to increase benefits now. The President, in his initiatives, in his budget to be specific, has over $400 billion additional revenue—not revenue—entitlement changes that’s over a trillion dollars. Over a trillion dollars in reforms in Medicare, just as a down payment. So we’ve already done that, in addition to $1.6 trillion in cuts, which we’ve already voted on. We’re almost $1.6—$2.6, $2.7 trillion in cuts in spending and entitlements as a down payment. We need to see the revenue.

O’DONNELL: But as a journalist, I look at this, and I don’t see Speaker Boehner and the Republicans making concessions on revenues, and I also look at this and I see the Democrats as not making concessions on entitlement cuts. Yes, there are some that the President has offered. But in terms of larger spending cuts he has the same spending cuts on the table from 2011. Why can’t he move on the spending cuts to move this forward?

PELOSI: Well, because if you go beyond $1.6 trillion in spending cuts, pretty soon you’ll have a blueprint for a second-rate nation. You have to reduce the deficit for sure, but—

ROSE: But if you go over the fiscal cliff, you have a recipe for a second-class nation, too.

PELOSI:  But you can’t go there, you can’t go there, you can’t go there. Now let me just say because I think it’s very clear—it needs to be clear—that we’re, Charlie, about two stage, that the Speaker suggested two stages. Let’s do something significant now, and then in the next stage we can address further entitlement review/reform as well as reform of the tax code. You can’t do all of that in a two-week, three-week period, but you can do a down payment, set the stage, and go to the next stage, because we care more about saving the entitlements than the Republicans do. So we do want to reform them.

O’DONNELL: And just really quickly, do you agree that if we don’t have a deal this week, it won’t get done until after Christmas?

PELOSI: No. I’m more optimistic than that.


PELOSI: I do think that Mr. Boehner is a well-intentioned person. He knows what the risk is, because actually this isn’t about us. This is about the American people; people watching your show, drinking their coffee, wondering how they’re going to pay their bills. And how does this affect them, how they pay their bills, how they reach retirement, how they send their kids to school, and the rest of that. This has—is relevant to their lives, and that is why we cannot be frivolous about it. Just get it done. Whatever it is, get it done, and make corrections or expansions on it next year. But they have to know that they can pay the bills, their holiday bills next year.

Click here to watch the video.

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Chris Licht is the Vice President of Programming, CBS News, and Executive Producer of CBS THIS MORNING.

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Press Contact:   Lorie Anne Acio      212-975-5460