gwen: the money debate. and the political debate over palestinian statehood. tonight on "washington week." >> middle-class americans shouldn't pay higher taxes than millionaires and billionaires. this is not class warfare, it's math. gwen: the president fights back and so do the republicans. >> give the federal government more money would be like give a cocaine addict, all right, more cocaine. gwen: staring each other down on principle and on politics. while out on the campaign trail

the republican primary begins to resemble a two-man race. >> it's different what -- than what he put in his book not six months ago so you better find that rick perry and tell him to stop taying -- saying that. >> it's not the first time rick's been wrong. >> and a tense showdown over palestinian statehood. covering the week, christi parsons of tribune news, john harwood of cnbc and the "new york times," karen tumulty of the "washington post," and susan davis of "national journal". >> award-winning reporting and analysis, covering history as it happens. live from our nation's capital, this is "washington week" with gwen ifill. corporate funding for "washington week" is provided by --. >> we know why we're here. to give our war fighters every

advantage. >> to deliver technologies that anticipate the future today. >> and help protect america everywhere from the battle space to cyberspace. >> around the globe, the people of boeing are working together to give our best for america's best. >> that's why we're here. >> additional funding for "washington week" is provided by prudential financial, norfolk southern. nean annenberg, the corporation for public broadcasting and by contributions to your pbs station from viewers like you. thank you. once again, live from washington, moderator gwen ifill. gwen: good evening. this has been a week of standoffs between the president and congress, in congress between the house and the senate, among the g.o.p. presidential candidates, and at

the united nations. the president was first up with a proposal to tax the rich and use the money for stimulus spending and deficit reduction. >> we shouldn't balance the budget on the backs of the poor and the middle class. for us to solve this problem, everybody, including the wealthiest americans and biggest corporations, have to pay their fair share the gwen: the republican response was swift. >> i don't believe that class warfare is leadership, and, you know, we could get into this tax the rich, tax the rich, but that is not -- that's not the basis for america. and it's not going to get our economy going again and it's not going to put people back to work the gwen: putting people back to work, john. did we get any closer to that this week? >> absolutely not but we did question the a -- get a good political brawl. gwen: yes, we did. >> when the president laid out

his, the elements of the jobs act to try to get people back to work there were payroll tax cuts the president hoped would stimulate hiring the this week we got pay-fors, straight out of the democratic ply -- playbook. the so-called buffett rule, named offer warren bufferet, the famed investor, saying yin -- anyone who makes a million-dollar income should on principle pay the same rate in taxes as the middle class. he said he should pay as much as his stret -- zrement rollback of course deductions that they have, oil and garks corporate jets, all the things that democrats have been talking about in the past and republicans respond, as john boehner said, it's class warfare. gwen: that's the key. that's all the kings the democrats were talking about in

the past and all the things the republicans had said no to. they promised a new focus on the economy, but to what end? >> well, one end is to get the president's approval ratings up, to get him having a greater ability to pressure congress to deliver on his agenda and the second is to win re-election in 2012. the president believes he tried over the summer to negotiate a bipartisan deal that included entitlement cuts, cuts to medicare and social security, and tax increases. john boehner wanted to make that deasm the republican caucus wouldn't let him and the president decided ok, if that's the way they want to play we're going to have a big fight. >> i was struck by how warren buffett became the biggest celeb in the country, al know no one knows who he or she is. >> by the way, his secretary

probably makes more than any of us. >> does the secretary -- does he pay lower taxes in >> he could. it defends on how much income comes in capital begins -- gains which is taxed at a lower rate, 15%, than personal income. one thing is true, the wealthy have done a lot better in this economy than people at the middle and the bottom. republicans counter and say yes but they're also paying a higher share of all the taxes paid because so many people don't pay any taxes. both sides have talking points in the debate, but the president thinks he's on strong ground with the base. and if you look at the recent polls, 80% of the american people said yes, tax millionaires, 60% said yes, get rid of the bush tax cuts for people over $200,000. >> although i do hope warren

buffett's secretary does vr at least a few berkshire hathaway shares. >> it strikes me that both sides are using that class warfare language. what is going on there? >> it's an old standby for them to try to resist theys popular initiatives. he shall he has used the line, yes, it's class warfare and the rich have been winning. buffett himself has used that line. i think there is still a prospect for a deal involving payroll taxes to provide some stimulus. don't know how it's going to be paid for. i think it's likely to come at the end of the super committee process which is supposed to cowlminate around thanksgiving time. >> and given that polls show people agree with obama on this, does he think this will sell? >> he hasn't been able to gain

tractionion on congress, partly because the general economy is so bad. people are sour on the economy and that makes him -- them sour on hid -- his leadership. the question is are people listening to the president and will they pressure mechanics of congress? there hasn't been any evidence that we can move them so far but he's just begun to move this tack. gwen: in the past they've resisted this notion he was raising taxes and this time he's not exactly embracing it but not shying away from it. >> he's not only not shying away from it, he came out in the rose garden and said he would veto any deal that had cuts in benefits for middle class or working class people that did not raise taxes. thozz how the president is sharpening the divide. it's something liberals very much wanted him to do.

they were tired of this back-room negotiating he was doing with john boehner. so he at least made part of his political base happy even if democrats, as everyone noticed, are not rushing to pass this jobs bill right now. gwen: that sets stage for the next big p standoff. are we on the verge of another government shutdown? the question is about providing for aid to fema. but it's more complicated than that. the house passed it and the senate democrats rejected if. each side is waiting for the other to blink the >> do they want the government to shut down? do they want fema to close? >> harry reid now says he won't take that bill up. harry reid is arguing with himself. this is why people don't like washington. gwen: that's among the reasons, anyway. susan, how do we get back to this point of debating

government shutdowns again? >> because this is a congress that's proven time and time again this year that they only function under extreme deadline pressure. unless things are about to fall off a cliff, they can degree on anything the i would think the government is not going to shut down but it's another example of how everything has about, even the most basic requirements of government, which is what this funding bill is, it only funds the government through mid- november, it's tiny, almost nothing, but almost every note -- vote has become either a test of philosophical purity on both sides or party unity or just plain electoral politics the gwen: does this mean all the disputes in the past that have come to last-minute resolution have basically been papering over fundamental disagreements that just bonet -- won't go

away? >> i think that's right. as simple as this equation was, there was an element on the hill today that was just both personal and partisan. there was real anger from harry reid toward mcconnell and boehner. and vice versa. they had a brief, verse conversation and boehner said we passed a bill, now it's your turn the >> haven't members of congress seen these polls that suggest people hold them in lower regard than ever before? are they trying to get into single digits? >> they're doing a request -- good job if that's the case. >> they went home for the august reess, polls showed people were not happy with the way they were doing things. but at the first test, we've seen them go back into their original positions. >> well, you said that you think there will not be a shutdown. that's also my instinct.

but given how quickly they fell back into this posture of gridlock, how would you explain to people watching this show why there would not be a shutdown? >> because i think they both know a shutdown is mutually assured destruction. no one is going to come out the winner, and if you can't see in the end how you're going to come out on top, you're going to agreement gwen: but there's no incentive to compromise. >> i do think republicans fear on some level that if the government shuts down they will be seen as the party that did it, even if the optics on this -- including all those tea party republicans? >> i think there is an element that would almost cheer it on the john boehner has a two-prong war he has to fight here. he has to face off the democrats in the senate and obama in the white house and he also has an internal faction in his caucus that we jobingly refer to as the "no, not ever

caucus." their bill failed the first time around. what they had to do intead of going and getting democratic supports -- support, be which they could have done, they decided to stick to their base and get the conservatives on bard. the choice is clear, by -- which i think was a shot across the bow to harry reid to say we're going to stick to our guns. this whole thing perfectly explains why american approval are -- of them is now in the teens. i think 13% the if you are unemployed, conte -- don't have a job, i think it the -- it's just clutter and noise coming from washington. >> it's almost enough to wonder if they're ever going to do again in this congress. is this a do-nothing congress? is obama going to be able to make that case? >> great question. beyond the funding of the

2k3w069, this super committee tarvings -- tanked with finding further deficit reduction, they've got to thanksgiving to report out and vote, the expectation is they will get something bun -- done but i don't think this is a congress that's going to do big things. and i don't think they'll do anything without a fight. >> and on the economy in? it's hard to see how it happens. we're already seeing the 2012 elections coming into play here in part because i think the republicans have a confidence about the weakness of obama. they're confident that obama is beatable and when you look at the senate, i think there is confidence that that chamber will flip. if you think you can get more of your world view enacted next year, they're patient. >> how far apart are they really? >> not far apart. what they're essentially fighting over is $1.5 billion which would offset, pay for partially the $3.5 billion that

would fund disaster relief. it's less than a fraction of a percent. not that far apart, but it does go back to a philosophical question of democrats that they don't want -- of republicans that they don't want to fund anything not paid for the gwen: and last night in orlando, the debate -- mitt romney and rick perry commanded center stage as in this exchange. >> i don't see how it is that a state like texas, to go to the university of texas, if you're an illegal alien you get an in-state tuition discount. delazz -- that's $22,000 a year. >> if you say that we should not educate children who have come into our state for no other reason that they have been brought there by no fault of their own, i don't think you

have a hear. >> rick perry has the reputation for depeeng -- being the doctrinaire conservative and romney of the more moderate but in this debate them switched roles. what were they trying to do? >> you saw romney trying to box perry in and get to the right of him on one of the few issues he could, and that's immigration. for perry it was a difficult moment because he was forced to choose between defending this position, when i he -- which he did even though he -- it was very unpopular with this audience, or changing it be and then he would be accused of being a flip-flopper. perry came into this race, shot to the front of the field and in these three debates he's becoming progressively a wobblier and wobblier

front-runner. people thought this was going to be the candidate who could come in and win over the republican establishment because of his record as the longest continuously serving governor in the country and at the same time ignite the passions of the tea party. gwen: but is it that he got in too late and it's not as easy as it looks? >> that's one thing you are seeing. it's looking like he's not able to do either one and in part what you saw last night was the contrast between him and mitt romney. 9 contrast between someone who hasn't done this before and someone who has. >> do you think there is room for someone to get into the republican race? or is this the field? >> the republicans keep speculating that there is, but i think what rick perry's entry has suggested it is that any time a white night enters,

that's his day and from then on he's requesting to get scuffed you have up. >> don't you think someone who can beat rick perry like a drum has got some skills. what is the problem exactly? he flubbed the attack, which is you going on offense. how do you diagnose the problem? >> is it that rick perry didn't do well or that romney well -- really did? >> well, one thing, mitt romney, for those of us who covered his campaign four years ago he's much sharper, more focused, more disciplined and much quicker on his feet than he was. rick perry, yes, he drubbed kay bailey hitch -- kaye bailey hutchison but he has spent his career in a basically one-party

state where -- and he's running in a primary where people are very concerned that someone they nominate can then appeal to a general audience and independents. gwen: there were moments when it sound more like a book club keebt to me than a political debate. >> you said in your book, now you're saying that -- were there whoppers flying around there in had >> oh, many. even by the standards of presidential be debates there were a lot of them. rick perry talked about how one person had lobbied on -- him on the h.p.v. vaccine was a desperately ill, diagram woman. in fact he had never met this woman before -- until after he had signed the executive order. mitt romney said he had changed a line in his book when he

didn't the gwen: and it's going to be a long campaign season the now we move on to the last in this week's "haven't we been here before" series. despite the obama administration's most vigorous efforts to head it off, palestinian leader mahmoud abbas presented the united nations with a request for recognition today. the speech -- abbas' speech was warmly received at the u.n. general assembly but not by the u.s. or by israel. so how did it come to this, christ ie? had >> we could go back many decades to answer that question but we could also start with the administration, you remember the president began very hopeful to do something about the middle east the >> they're always hopeful the >> get them talking and defuse tensions and maybe that would be a bridge to building warmer relations in the region the but two years later, obviously things have fallen completely apart, the parties aren't even

talking to each other and don't seem to have any incentive to do that. gwen: and the u.s.a. could not persuade abbas not to bring this big challenge to the u.n., which we -- they were desperate to do. >> they've had many weeks, many months to work on that. it would be embarrassing. the u.s. obviously opposes it. the u.s. and israel want to see this worked out in direct taungs but despite -- talks but despite all the months of direct diplomacy, it still seems abbas has no reason to go into talks with the israelis expecting anything more than he has already gotten. >> what does this is a about the balance of power in the middle east especially after the arab spring? >> it says a lot. obama, this was a key part of his foreign policy, to turn a page with the arab world, the muslim world.

that did happen. it just turned out the reboot wasn't one he was trying to cement what it says about going forward here, the u.s. position is a little bit more compromised than it was about. no one in the u.s. -- u.n. really saw the unus -- u.s. as an impartial broker going into this. but there were some things -- those were not in play this week as he addressed 9 -- the u.n.. but this is happening as there's kind of a shift taking place in the dynamics there and it's no longer just the u.s., no longer just the israelis, palestinians and the u.s., you've got europeans coming in and taking a stronger role and the u.s. and israel a little bit more isolated from the international community. >> how much pressure is the white house feeling politically on its stance toward israel? you had mitt romney in the

debates saying he thrown israel under the bus, rick perry sharply attacked him on his stance on israel. how much of a problem is that who are the white house? >> that's a good question. when you look at the actual policy, the obama administration hasn't changed it. every u.s. administration back to lyndon johnson has had the same basic bottom lines and obama hasn't departed from that. what he changed was the tone, of course. >> the claim about the 1967 borders was false, of course? >> right. there has been some twisting of obama's actual positions on this. he wanted to use the 1967 borders as a starting point but for a land swap to take place and essentially for the parties to work it out themselves and make their own piece -- basket -- peace. bull your question was -- what was your question? [laughter] >> about the political pressure the >> right, that's very important.

i want to go back to that because the administration, i think you did see obama responding to some domestic political pressure from his own base when he was speaking before the u.n. this week and he was emphasizing we really do stand with israel. it was a much more lopsided story than he's told in the past, much more sympathetic to the israelis, and that was a message to his base. i don't know how much he's really at risk of losing jewish voters. gwen: and netanyahu was, got up and spoke today and was very supportive of the u.s. everything else was supporting abbas. thanks, everyone. we have to stop here, but the conversation continues online, in the "washington week" webcast extra, where we'll get to everything we couldn't get

to here. it will be posted at 11:00 eastern time on pbs.org the and before we go tonight, we send condolences to the family of the late charles percy of illinois, the three-term senator and among 0 things, father of share percy rockefeller, the c.e.o. of weta here in washington. chuck percy was 91 years old. keem up with daily developments on air and online at the pbs news hour, and we'll see you next week right here on "washington week." good night. >> "washington week" was produced by weta, which is solely responsible for its content. funding for "washington week" is provided by -- >> this rock has never stood estimate since 1875 we've been there for our clients through good times and bad. when their needs changed, we were there to meet them. through the years from investment to real tate solutions, we've developed new ideas for the financial

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