STEVE CHIOTAKIS: Senate Minority Leader Mitch McConnell said today there probably won't be any real budget solution until Barack Obama leaves the White House. McConnell said that on the Senate floor this morning. Meanwhile, the president and Congressional Republicans continue their talks today. To raise the nation's debt limit. If that doesn't happen by August 2, the U.S. Treasury says the country will default on its debt.
Republican Congresswoman Shelley Moore Capito represents the 2nd District of West Virginia. She serves on the House Financial Services Committee and she's with us now. Good morning.
SHELLEY MOORE CAPITO: Good morning.
CHIOTAKIS: I know the debt talks are hung up on questions of tax increases, and entitlement cuts. How would you vote on a plan that would include some sort of tax revenue increase?
CAPITO: Well, I think we have a spending problem in Washington. We don't have a revenue problem. And I think in order for us to get good solid reform, we really need to look at the spending issues first. So, a raise in the debt ceiling with a tax increase is a non-starter for me.
CHIOTAKIS: What about those who argue that defaulting on the debt is much worse than worrying about tax increases?
CAPITO: I don't believe we're going to, under any circumstances, default on our debt. I mean, I think that we all realize -- I mean I just came from a very detailed discussion on this -- we all realize that we have obligations around the world that we need to stay true to. And I think we intend to do this. This is a bargaining negotiation that we're going through right now and I think at the end of the day, you'll see us fulfill our commitments but also with some very significant policy issues and spending reform and savings.
CHIOTAKIS: We hear from a lot of economists that there has to be some sort of revenue raising some how. Do you dispute that?
CAPITO: Well I think, you know, if you go back and look at the Ryan budget that I voted for and that was heavily criticized because of the Medicare reform issues in there --
CHIOTAKIS: This is Congressman Paul Ryan's bill from the House.
CAPITO: That's correct. And also in that bill was a lot of tax reform. It was eliminating tax loopholes, which creates more revenue. It was looking at tax fairness issues which would create more revenues. So I think tax fairness and tax reform is believed to be, and I believe it to be a way to raise revenues that makes it more equitable in the tax code. And I think we've said and I've said, that we would be willing to go that direction.
CHIOTAKIS: Is defaulting on the debt an option do you think?
CAPITO: I don't believe so. Now there's some people here in Congress who think that's OK. But I'm not one of them. And I don't think the vast majority of us are either. I think we realize that we have to move ahead and we have to stay true to our commitments around the world and to our Social Security recipients and others. But we've got to find a way to make significant cuts. You know, cutting spending in Washington is probably harder than for me to do a back flip, or a triple back flip I would say.
CHIOTAKIS: Do you think if there was not such a strong Tea Party presence in the GOP that this debate would be happening at all?
CAPITO: I think the debate would definitely be happening. You know, maybe it would take a bit of a different shape. The reason I say that is we realize that the spending has got to stop. And the American people realize this. That's how a lot of folks were elected in 2010 was basically on the spending issues. So, would it be different? It might be different, but as a republican myself who I don't know that you would say I'm in the Tea Party -- I have a lot of Tea Party support, but I wouldn't be traditionally considered a member of the Tea Party -- I believe that the direction that we're going is fiscally responsible and is better for the future of our country to get out from under this debt and I always think of everything just like a regular person does. If you've got a lot of debt on you, and you're trying to, you know, pay this bill and that bill, it weakens you. And I don't want to see our country get weak under this debt.
CHIOTAKIS: Where did this spending quandary, do you think, come from, because it certainly didn't seem like such a problem for the past 20 years or so when there was a Republican Congress and even when there was a Republican president?
CAPITO: Well, I think obviously the wars have been costly for us. We've had a down turn in our economy. We have 9.2 percent unemployment. Without a growing economy, you can't grow your way out of leaner times. There again, you think about, "Well am I going to get a raise this year? Not really. Well my expenses are going up." And that's what's happened here. I think that you know -- and I've been in Congress now for 11 years -- I think that we were not as vigilant during the golden years as we should've been maybe when the revenues were up in the 2000s and we expanded too much. And then certainly since the president has been in with the $800 billion stimulus plan and a lot of raising each department over 10 percent, that's been very costly in terms of the debt. So it's been growing, but I think it's been accelerated over the last several years.
CHIOTAKIS: You know, we got obviously housing -- the housing market in this country -- is still pretty bad off. And we got this really lackluster jobs report last week. How do we get the recovery back on track do you think?
CAPITO: Well, I think you know, in a lot of ways, we need certainty. We need certainty in terms of the job creators -- big and small -- need to know what their tax structure's going to be. They need to know what their health care's going to cost. They need to know that the regulatory regime in the country is not going to stand in the way of business expansion or the ability to create jobs. And we're lacking that certainty. A lot of people are just staying on the sidelines, keeping their cash, and waiting to see what's going ot happen. And I think you know, we saw a bit of a bump in January and I believe that was a reaction to the tax compromise that was struck in December. We need to get to that point again where our economy will be able to grow without the encumbrances of worrying about, "I'm going to have to pay another 5 percent in taxes. My health care's going to cost me thus and so." You know there's always going to be questions but there's too many questions right now.
CHIOTAKIS: What are people telling you about the economy and about the debt limit debate back home?
CAPITO: You know, it's funny because normally when you get approached in a grocery story -- it's about gas prices or health care. Now it is really on the spending issues and basically I think what people want is they want us to hold the line in terms of the spending and the fiscal restraint, but they want us to pass the debt limit at the same time. So, I think they want it coupled and that's the direction that I'm moving in.
CHIOTAKIS: Congresswoman Shelley Moore Capito, republican from West Virginia. Thank you for joining us this morning.
CAPITO: Thank you so much.