Oh goodie. This is the type of bipartisanship we're going to get to look forward to after the new year. ConservaDems and Republicans both agreeing that more pain needs to be inflicted on the working class. On Fox News Sunday, both Sen. Kent Conrad and Rep. Jeb Hensarling agree that President Obama's Catfood Commission's co-chairs didn't go far enough with their recommendations.

Of course they disagreed on what the recommendations even were or what specifically each of them would do differently. Neither of these two explained how those recommendations or their suggestions here are supposed to get Americans back to work. We've been cutting the tax rates for businesses for decades now and it's created jobs alright, in India and China. Someone want to explain to me how simplifying the tax code is going to stop outsourcing? I'd like to have that "adult conversation" Mr. Hensarling.

WALLACE: Senator Conrad, let me start with you. You voted for the deficit commission plan which would cut $4 trillion by the year 2020 from the deficit. It didn't pass. But you are the chairman of the Senate Budget Committee. How much of this do you intend to put in your plan this next year? And what do you think the president is going to do?

CONRAD: What I think is really necessary now is that there be a summit that involves the president. You know, when Judd Gregg and I first proposed this notion of a commission three years ago, we designed it so the president's people were at the table. The secretary of the treasury was the chairman of the commission. The head of OMB was one of the 18.

When we didn't get sufficient votes in the Senate to advance that proposal, the president, by executive order, created this commission but did not include his representatives.

I think if we're going to reach conclusion, we've got to have the leaders of the House and the Senate, Republican and Democrat, and the president or his representatives at the table. And I think that's the next logical step.

WALLACE: And how much of this do you think could get through?

CONRAD: I think a large part of it could get through. Look, I would prefer to even go further in deficit reduction than this package. I think we need more than is provided for in this package.

But there's certainly a strong beginning. This cuts spending $1.5 trillion over the next 10 years. It has dramatic interest savings. It puts Social Security on a solvent course for the next 75 years.

And perhaps most important, it fundamentally reforms the tax system in this country that is so broken by eliminating or dramatically reducing a lot of the exclusions and deductions so that we can lower rates to help America be more competitive.

WALLACE: Let me just ask you real quickly before I bring Congressman Hensarling in, have you told the White House about this idea of the summit or are you just telling us now?

CONRAD: No, I've told them.

WALLACE: And their response?

CONRAD: I've told them and I've told the leaders in the House and the Senate. I've told the leaders of the commission that...

WALLACE: And what's the president say?

CONRAD: I've not talked to the president, but I've talked to his representatives, and they didn't give me a reaction.

But you know, if you think about where we're headed, we're going to have to do a budget resolution. We're going to have to do a debt limit extension this year. I think it is critically important for the country that we send a signal that we're going to do something serious about this debt.

We are borrowing 40 cents of every dollar we spend. That can't continue much longer.

WALLACE: Congressman Hensarling, let me bring you in. You were also a member of the panel but you voted against the plan. What do you think of -- although, having said that, you say that you support major portions of it.

What do you think of the idea of a summit bringing everybody together and try to get a deal and act this year?

HENSARLING: Well, I would -- I would endorse the idea. I believe that Republicans are ready to have a serious adult conversation with anybody who wants to talk about saving our nation from eventual bankruptcy.

I mean, one good thing about the commission is, number one, I think everybody left agreeing there is a crisis, the most foreseeable crisis in American history.

Second of all, I think it was an adult bipartisan conversation of which, frankly, there haven't been many. And somebody like Senator Conrad was a huge contributor to that.

Next, we clearly have had -- we have to have presidential leadership. I hope we get it from President Obama. And we need to do something very, very soon. As Senator Conrad said, we are borrowing almost 40 cents on the dollar, much of it from the Chinese, and sending the bill to our children and grandchildren. That cannot be sustained.

WALLACE: Congressman Hensarling, let's take a look at what happened on the commission, because all three House Republicans voted against the plan, while all three Senate Republicans voted for it.

Senator Tom Coburn, one of the people up there on that graphic, who's such a hardliner on spending he's known as Dr. No, said pass the plan, which would have -- if you passed it by 14 of the 18 votes, it would have forced a vote, an up-or-down vote, in Congress this month to cut spending by $4 trillion. Here's -- take a look at what Tom Coburn said.

(BEGIN VIDEO CLIP)

SENATOR TOM COBURN: The time for action is now. The threat is real. It's urgent. We cannot wait for another election. We cannot wait until we get more of what we want.

(END VIDEO CLIP)

WALLACE: Congressman, didn't you waste a chance here to back up your rhetoric and force an up-or-down vote that would have maybe not been perfect but would have done substantial -- made substantial progress in cutting the deficit this month?

HENSARLING: Well, Chris, number one, the deficit is the symptom. Spending is the disease. There's a number of elements about this plan that I liked. But at the end of the day it still, unfortunately, represents a roughly $2 trillion tax increase on the American people and does not fundamentally address the key driver of our national fiscal crisis, and that is health care.

And so yes, I want to do something soon. I've been working for eight years, ever since I came to Congress. I've co-sponsored a spending limit amendment to the Constitution. I've co-sponsored Paul Ryan's road map for America's future, solutions that would ensure that the next generation doesn't have to have a lower standard of living.

And so, listen, I think I could have give Senator Coburn's closing speech. He probably could have given mine. We just came to slightly different conclusions about this package.

And if I could, Chris, there's nothing magical about 14 votes. If the speaker and the Senate majority leader want to bring this provision before the Congress, they can. And I would encourage them to do it. Whether it received 18 votes, four votes or one vote, they have the power to bring this to the Congress today.

WALLACE: Senator Conrad, I want to pick up on some of the objections that Congressman Hensarling has on this, because they represent what a lot of critics say. And obviously, Congressman Hensarling speaks for the new Republican majority that takes over in the House at the beginning of the year.

First of all, he says, and a lot of Republicans say, that this would - - this plan, the deficit plan, would have increased revenue $2 trillion over the next decade. True or false?

CONRAD: Well, I don't agree with that assessment. It would have increased revenue, by the commission's estimates, by a trillion dollars over 10 years.

But how would it have done it? It would have done it by dramatically reducing tax expenditures, using the vast majority of the money to lower tax rates to make America more competitive, including lowering the top corporate rate from 35 percent to 28 percent, which most economists say would help us be more competitive...

WALLACE: OK.

CONRAD: ... and would help us create more jobs.

WALLACE: Let me ask you about the other aspect, and this is a criticism you hear from a lot of people -- is that this bill didn't get serious about the single biggest cause of government spending, which is health care.

CONRAD: Well, I really respectfully disagree on that as well. First of all, we've just done a health care reform bill that is going to reduce the deficit, according to the CBO...

WALLACE: Well, you know, there's disagreement about that.

CONRAD: Well, then -- no, no, no. There's no disagreement by the official scorekeeper, which is CBO.

WALLACE: I understand.

CONRAD: They say that the health care reform bill will reduce the debt by over a trillion dollars over the next 20 years. It needs to have more done. And this bill -- this proposal from the commission does more.

First of all, it deals with the most important thing most economists tell us, which is to change the tax treatment of health care, phasing out the deductions, number...

WALLACE: The tax exemptions. Let me just...

CONRAD: The tax exemptions.

WALLACE: ... because we are going to run...

CONRAD: Yeah.

WALLACE: ... out of time here, and I want to get into taxes.

Congressman Hensarling, your response both on the revenue side and also about the health care?

HENSARLING: Well, back to the commission plan, it depends on whose baseline you use, which is Washingtonese for whose set of assumptions. The commission decided to use the president's assumptions. We respectfully disagree and believe that it represents a $2 trillion tax increase.

Be that as it may, yes, health care continues to be a contentious debate in Washington. I mean, I think it is instructive that the Congressional Budget Office, that probably gave the health care plan its most glowing score, did not change their long-term cost estimates.

And if you talk to the actuaries at the Centers for Medicare and Medicaid Services, they actually say it will increase the national health care bill.

And so until we change the architecture of the health care plan that was recently passed by Congress and reform Medicare for future generations, grandfathering all the grandparents, you just don't get there from here. I don't see any road to fiscal sanity without doing that.

And although this plan of the commission does many great things with respect to trying to flatten the tax code, save Social Security for the next couple of generations, its fatal flaw is its failure to deal with the single largest driver of fiscal insanity, and that is our health care program.

WALLACE: Gentlemen, let me move to the other big subject in Washington right now. While the deficit commission, and you on it, were talking about the debt crisis and cutting the deficit, there are negotiations going on between the president and congressional leaders of both parties about a compromise plan that would greatly increase the deficit, and let's put that up on the screen.

Extending all the Bush tax cuts would add $115 billion to the deficit just in the first year. But the president is now threatening a veto unless Congress also extends other tax cuts for lower income families and small businesses, and extends jobless benefits for another year. And the cost of all that would be $150 billion.

Add it up and we're talking about another $265 billion and more debt the first year, and as much as $800 billion over two years.

Senator Conrad, even in Washington, those are big numbers. I know we've got a weak economy, 9.8 percent unemployment as of Friday for the last month. Would you support that compromise? And how do you square the idea of adding another quarter trillion dollars to the deficit at the same time you're trying to reduce the deficit?

CONRAD: Because what's clear is we've got to think of this economy in two different ways, the short term and the longer term. In the short term, I think it's imperative that we extend the tax cuts, at least for the middle class, because the economic consequences of a failure to extend the tax cuts are severe.

We could see economic growth cut in half if the tax cuts, especially those for those for low -- for the middle-income people are not extended. We could see economic growth cut in half next year. So it's simply got to be done.

But that doesn't take away from the fact we then have to pivot and have a longer term plan to control the debt and bring it down.

WALLACE: Congressman Hensarling, as I've laid it out, where you would have a temporary extension of all the tax cuts, but you would also extend at least for a year jobless benefits and also some of the, if you will, Obama tax cuts that were in his stimulus plan, could you accept that compromise?

HENSARLING: Well, we'll have to see how the negotiations unfold, but I think our position is quite clear. We don't want no tax increases on nobody. Now, that may be poor grammar, but it's great economics.

Ultimately, the cost of government is what it spends, not what it taxes. We have a spending problem in Washington. The cost of government has averaged 20 percent of the economy in the post-war era, and over the course of the next generation it's due to double.

We don't need any more taxes, number one. Taxes are already baked into the system. Under CBO's analysis they're going to increase roughly 10 to 12 percent over the course of the next generation.

WALLACE: But let me -- but if I may...

HENSARLING: But it's spending that's due to double. Yes?

WALLACE: Congressman, let me ask you one last question, because we're just almost out of time. There are some people who say, "Hey, look" -- here Republicans are saying, "If we're going to extend unemployment benefits for people who are out of work and have been out of work for months, the government has to cover that," but they don't have to find a way to make up for the difference when you're going to extend all of these benefits which is -- or, rather, all of these Bush tax cuts, which is going to cost a lot more.

I take your point that allowing people to keep their money is a cost, but it have an effect on the -- or is not a cost, but it does have an effect on the deficit.

HENSARLING: Well, I agree. But again, the deficit is the symptom. Spending is the disease. And I fundamentally reject that we're talking about tax cuts. What we're talking about is preventing tax increases, something that even Keynesian economists would warn against in this particular economy.

I mean, we have to have spending restraint, not tax increases. It's that simple.

WALLACE: I'm going to give the final 15 seconds to Senator Conrad.

Go ahead.

CONRAD: You know, the disease is the disease. The disease is a runaway debt. The fact is spending is the highest it's been in 25 years as a share of the economy, or 50 years. Revenue is the lowest it's been as a share of the economy in 50 years. You've got to work on both sides of the equation if you're going to reduce deficits and control debt.

WALLACE: All right. We're going to have to leave it there.

Senator Conrad, Congressman Hensarling, we want to thank you both so much for coming in today to discuss the challenges you're facing. Good luck to both of you gentlemen.

CONRAD: Have a good day, Jeb.

HENSARLING: Thank you.