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>> i was impressed. this is a plan that provides measures to create jobs in the short term but then focuses in on substantial deficit reduction as the economy recovers. it achieves the goal that every bipartisan commission over the last two years has said is the key, to get the deficit down to the point where the debt is no longer growing faster than the economy. it does it in a balanced way. and it's not some big liberal high tax plan. one fact shows that. it has somewhere between half a trillion and three quarters of a trillion less in revenue increases than the bipartisan bowls simpson commission plan and the gang of six plan, both of which had republican senators endorsing them. >> ifill: what do you think about it? >> i think the president's plan is in two parts. last week he talked about what he wanted to do to get the economy going. there were elements in there that i likeded. >> ifill: the job speech. >> the job speech. the focus on training. today was politics. it's not really economics. i think everyone understood what the president was doing today. you could see fr his demeanor on the piece before, it was politics. he's kicking off his re-election campaign. it kind of puts a bit of a pall over his very useful speech i thought from last week. >> ifill: class warfare? >> it's not a surprise that the president is going back to that and saying let's tax millionaires and all that. there's a lot of tax increases. look, we have to change our tax code. i agree with the president there. but he wants it to support higher spending. that's probably the wrong approach. >> ifill: let's talk about the tax increases. >> i very much disagree.... >> ifill: by all means. >> he's talking about the president's speech. let's move away from the speech. and let's look at something like 60-page long detail plan that has spending cut after spending cut. it takes on sacred cows for the democrats. it has changes in medicare that no democratic president.... >> ifill: i don't want to do that. i want to go through it piece by piece. let's start by talking about the tax increases that the republicans are so resistance to. the republicans are saying they're not necessary nor plausible. >> what the president proposed today is that we have a comprehensive tax reform that broadens the base and lowers the rate but produces net savings, net increase in revenue relative to what you would get if you made all the bush tax cuts permanent of $1.5 trillion over ten years. it's actually less than the bipartisan bowls simpson plan proposed. yes, he has specific proposals to close loopholes on hedge fund managers who pay less than their secretaries in rates and oil and gas loopholes and so forth. but he made very clear those were illustrative. he would work with congress. what he wanted was a comprehensive reform. lower the rates, broaden the base. do it in a way that both gives us more efficient code and brings in a lot more revenue. of course significant share is going to have to come from people at the top for two basic reasons. a, they are right now-- people that make over a million dollars a year-- are right now getting an average tax cut of over $100,000 a year from the bush tax cuts. we can't afford that. b, a lot of the unproductive loopholes in the code are concentrated in higher-income areas, big corporations, areas where people had high-priced lobbyists. but there are also a lot of expenditure cuts that members of both parties, including republicans who say they want to cut spending, i fear are going to not be willing to accept because those also hit special interests on the spending side. >> ifill: he took a big bite of the spending increases. i mean the tax increases. as well the spending cuts. why don't you do the same thing. >> sure thing. i mean, some of the spending cuts in this proposal i think everyone understands are necessary. he's looking to reform the treatment of federal pensions and looking to save the postal service, things like that. there will be some agreement. the so-called sacred cows, i think everyone understands that medicare is very serious challenges. the president last week put the word "modest" in front of medicare changes. medicare doesn't need modest changes. the president is underselling this. he's telling the american people we can do modest changes and we'll be fine. i think unfortunately that's not the case. >> ifill: is that the leaping- off point to work with congress. >> he called a sacred cow. since the president put this out in his so-called detailed proposal are very small changes to medicare. there's nothing that will really change the arc of medicare spending which is the kind of thing you have in, say, paul ryan's plan. that to me is what the most disappointing is. >> ifill: what about tax increases. how do you pay for this kind of deficit reduction without increasing taxes on somebody? >> sure. in the president's discussions with speaker boehner, the news report said there's about a four-to-one mix of spending reductions against revenue increases. the revenue increases were things that both sides agreed on. changing deductions in a way that lowered rates but broadened the base. i agree with bob. so you had that ratio. you had agreement. the president changed the terms of the discussion and the discussions fell apart. this four-to-one, this is in a sense the spending cuts here a lot of it relies on war spending that everyone understood would never be spent. the ratio supposedly is one-to- one but as people look at the ratio of spending to revenue it's not nearly one to one. >> ifill: the president said if he can't get what he calls this balance, he will veto anything that comes to his desk. he said also in the same talk that speaker boehner was guilty of a "my way or the highway" approach. isn't a veto threat also "my way or the highway"? >> no. >> ifill: why not? >> because what the president is is basically saying is i'll put my sacred cows on the table. $250 billion in medicare cuts including some changes in deductibles and co-pays and medi-gap coverage is indeed a sacred cow. it's about as much as we know how to do now in medicare without causing big problems. the health reform act will enable us to learn more in the future. and take further steps in the future. he is saying i'm put my sacred cows on the table but you have to put yours as well. i will hit in terms of some of these changes in medicare and other programs, i'll effect ordinary americans who don't have big budgets but in order to do that, we have to have some balance. big corporations, the people at the top of theincome scale have to contribute something too. speaker boehner is saying, no revenue whatsoever, period. that's my way or the highway. that's not what obama is saying. >> ifill: did you hear that kind of conciliatory language coming from the president today? >> you know, i did a week ago. a week ago i thought there was a lot of common ground. today it seems like a different tone, a different message. i give the president some credit. he finally put on the table what he really wants. his vision. they called it a vision. i do think it's a vision. there will be a contrast about the size of government and the size of taxes and what kind of society we want. >> ifill: is the challenge as we have this debate about taxes and about spending cuts and definite reduction, is the challenge that we're facing now more about politics or about policy? >> well, it's both. i mean in part i think some republican leaders don't want the president to accomplish anything before the election but fundamentally it's about policy and it's about ideology. it's also about campaign contributions and all of that stuff. you'll also unfortunately see some members both parties resist the president's proposal to do things like reduce some of the give-aways to big drug companies. in the 2003 drug bill that cost tax payers over $100 billion over ten years or to reign in some of the excessive farm subsidies to agricultural corporations. those are on the spending side. people like martin feldstein who was president reagan's chief economist have said that some of the most wasteful and unproductive spending anywhere in the budget is actually in the tax code. those are a number of things that obama is talking about. i'd also note that when you do the math and you include as one should the spending cuts that were just enacted last month in all of the non-entitlement programs, when you take the numbers, you remove the war spending-- i agree with phil there-- and you use the same budget baseline, the same measuring rod that both simpson and the gang of six today, you'll actually find the obama package is more than $2 in spending cuts for every dollar in revenue.e. >> ifill: does your math equal that? >> bob and i need to open up a spreadsheet after the show and do the math. there's going to be a mix of politics and policy. you know, for me it's fine actually for the president to put out his vision and give the kind of angry speech. that's fine. everyone should just understand last week was policy. this week is politics. hopefully those two can merge and both sides have to say, you know, we're going to move from where we are just saying no. but the president is playing the same game he's decrying. that's politics. >> ifill: bill swagel of the nuns of mer land and bob green stein, thank you both very much. >> woodruff: still to come on the newshour, the world bank and the euro crisis; a resurgence of violence in yemen; wolves versus ranchers in yellowstone; and the big money in college sports. but first, the other news of the day. here's kwame holman. >> holman: wall street struggled today with worries about the greek debt crisis. stocks cut their losses late in the day, but the market still snapped a five-day winning streak. the dow jones industrial average lost 108 points to close at 11,401. the nasdaq fell more than nine points to close at 2612. away from the trading floor, some 200 protesters marched for a third day, charging the financial system favors corporations. at least six people were arrested. rebels in libya tried to regroup today to renew fighting on two fronts. in sirte, moammar gadhafi's hometown, smoke could be seen as the two sides traded fire. and in bani walid, rebels tried to fight their way back into the city after gadhafi loyalists forced them to pull back on sunday. meanwhile, efforts to form a new cabinet in the transitional government stalled. some cities complained they were underrepresented. nato officials in afghanistan have confirmed the deaths of two troops, in addition to three killed over the weekend in separate attacks. so far in september, 26 international troops have been killed. meanwhile, president hamid karzai left afghanistan today for the u.n. general assembly session in new york. he's set to discuss war developments and seek more help in peace efforts. in japan, thousands of protesters marched in tokyo today, insisting the government abandon nuclear power. police estimated the crowd at 20,000. organizers said there were three times that many. the marchers carried banners, beat drums, and chanted, "sayonara, nuclear power." the protest came six months after the tsunami disaster caused the fukushima dai-ichi nuclear plant to spew radiation. rescue crews fanned out in northeastern india after a powerful earthquake that killed at least 53 people. the sunday night quake had a magnitude of 6.9. it shook remote parts of india, nepal, and tibet, with the worst damage in india. more than 100,000 homes were damaged across the rugged himalayan region. many towns in the zone lost electricity. former illinois senator charles percy died over the weekend in washington. he had alzheimer's disease. percy was a moderate republican who served three terms, starting in 1966. he chaired the foreign relations committee and considered a run for president in the 1970s. but increasingly, he clashed with party conservatives, and he lost his reelection bid in 1984. at his death, charles percy was 91 years old. those are some of the day's major stories. now, back to judy. >> woodruff: anxiety over the european debt crisis sent new tremors around the globe today, as you just heard, shaking up financial markets again. the most immediate worry: greece. its creditors are threatening to withhold the latest installment of a $150 billion rescue package. lenders are worried the government will not follow through on politically unpopular cuts. that prompted new fears today the country may default on its debt in a matter of weeks, triggering big problems across the continent and elsewhere. those developments served as backdrop to our interview with robert zoellick, the president of the world bank. the bank provides loans and assistance to developing countries. along with the i.m.f., it is a critical player in global economics and politics. we met at the world bank's headquarters here in washington. robert zoellick, president of the world bank, thank you for talking with us. >> pleased to be with you. >> woodruff: as we sit here today, a lot of worry out there about greece. you have said yourself in the last few days you think the world economy is entering a danger zone. do you worry more about the european debt crisis or about slow growth here in the united states? >> i don't think it's an either/or. we're in a world economy. both of them matter. but i think the euro zone right now presents a more imminent issue. that's what we're seeing in the markets. >> woodruff: given what's happened with the euro zone, is it better if this has to be the choice for the greeks to default if that is the only choice rather than to continue to muddle along, which is what has been happening? >> yeah. well, so far what the aur means have done whether it's greece or some of the other countries is to provide various types of liquidity support. they're making sure that money is available for banks or for the country's bonds. that's important but it buys time. it only buys time. there's more fundamental decisions whether it's greece or any others so the point that i've been making is that europe really is approaching a key decision point here just like it did in 1989 or '90. and it needs to think of three issues in an inter-connected fashion. one is the sovereign debt. for some countries like greece in a very, very heavy load. b, the banks because if the debt doesn't have its full value, that undermines the bank's capital. and then that shows problems with people pulling money. third for some countries is the competitive position. it comes down to a question of whether that monetary union that was created some 20 years ago will have a complementary fiscal union which can be done in different ways or whether europeans manage the consequences for highly indebted uncompetitive countries. but it's also affecting all of us just as we saw in the summer where the combination of events in europe and the united states started to have a contagion effect in markets globally. >> woodruff: you speak about the euro zone, the monetary union. there are those who argue that it would be better to have each country standing on its own dealing with the consequences