"We could have had surpluses during this decade," said Rubin. "We started the decade with surpluses and we had good federal revenues. But instead, because of the fiscal policies put in place, we had deficits through all this period.
"What Senator Obama has said is that he is committed to restoring sound, long-term fiscal conditions," Rubin continued. "I think that's essential if we're going to have a good and strong economy. He said he'll pay for everything he's going to do with respect to Social Security and Medicare."
Rubin said "we could absolutely get back" to a balanced budget.
Fiorina said McCain would balance the budget by 2013 by growing the economy and getting government spending under control.
"John McCain has never asked for an earmark," Fiorina said. "He has promised he would veto every bill [that has them]. Barack Obama has voted for bills that are laden with pork, whether it's the 2005 Bush-Cheney energy bill, the 2008 agricultural subsidy bill. Both of those John McCain voted against because they were laden with pork. Both of those Barack Obama voted for."
[According to Craig Holman of government watchdog group Public Citizen, who is quoted in this USA Today article, McCain "delivered" on a $14.3 million earmark for SunCor Development in 2003.]
Asked about McCain's comment that "there is nothing that's off the table" when asked about an increase in payroll taxes last week, Fiorina said the Arizona senator does not support raising payroll taxes despite the comment.
"John McCain has been very explicit in saying he does not support an increase in payroll taxes, particularly because they impact small businesses and sole proprietorships more greatly than any other part of our economy," she said. "His record is very clear on that, and he has a number of economists who support his assertion, that we can solve the Social Security and Medicare crisis - but particularly Social Security - without raising payroll taxes."
Both Rubin and Fiorina, top economic advisors to their respective candidates, said economic conditions could deteriorate further.
"I think that the current difficulties, the current duress, I think the most likely scenario with respect to all of that is that it will likely to continue for quite some period of time, could get a little bit worse," Rubin said. "There's always some chance that matters could get better more rapidly, but I think that's very low probability. And there's some chance (and hopefully it's a low probability) that things could get considerably worse."
"I certainly agree with him that the situation could get worse," said Fiorina. "And there are a couple of things that will make it worse. One is to raise taxes, which is what Senator Obama proposes to do. Another is to massively increase government spending, which is what Senator Obama would propose to do, over $1.5 trillion in increased government spending. And the third is to become isolationist and protectionist, which Senator Obama would also propose to do."
Rubin denied that Obama intended to raise taxes.
"What Senator Obama said is that he'll have a middle-class tax cut, and that tax cut will go to roughly 95 percent of all the people whose incomes are under $250,000," he said. "For people whose incomes are in excess of $250,000, their income tax rates will go back to the rates we had under President Clinton. Their capital gains rate will go up to some rate less than the rate we had during most of the time President Clinton was in office. Taxes on dividends will go up to the rate that will apply to capital gains, and that will be substantially below the rate that was in place when President Clinton was elected."
He also said Obama has not changed his mind on expanding offshore drilling, which Obama now says he would consider under very controlled circumstances despite opposing it in the past.
"What he said with respect to offshore drilling is it's going to have no effect in the short term, zero; that it's going to take years for this to come on board," said Rubin. "On the other hand, you're referring to the proposal that came up Friday, in which offshore drilling was a piece of a much larger piece of legislation.
"What he basically said, as I understand it - and I think this is right - is that there's a lot in there that he thinks could be constructive," he added. "And if it means doing something that he has a lot of reservations about in order to accomplish something much larger that's constructive, then that's the way a legislative process should work, in a democracy."
Read the full "Face the Nation" transcript here.