OFFICE OF THE MAJORITY LEADER

TRANSCRIPT

On CNBC Discussing the Automotive Industry and Helping Automakers with TARP
November 18, 2008

... FOR THE AUTOMOTIVE INDUSTRY WHEN THEY HEAR TESTIMONY FROM THE BIG THREE AUTOMAKERS. WE WELCOME YOU TO ""POWER LUNCH"" FOR THIS TUESDAY. I'M BILL GRIFFETH ALONG WITH SUE HERERA AND MICHELLE CARUSO-CABRERA AND DENNIS KNEALE WILL BE JOINING US SHORTLY AS WELL. WE WANT TO GET AN UPDATE ON WHERE WE STAND ON THE ISSUES FACING CAPITOL HILL THIS YEAR AND WE'RE PLEASED TO WELCOME BACK HOUSE MAJORITY LEADER STENY HOYER. THANK YOU FOR YOUR TIME. >> THANK YOU, GOOD TO BE WITH YOU. >> HOW DO YOU STAND ON THE PROGRESS OF THE TARP, THE CHANGE IN FOCUS AND WHETHER SOME OF THIS MONEY SHOULD BE USED TO HELP AVOID FORECLOSURES AND TO BAIL OUT THE AUTO INDUSTRY? SHOULD IT GO THAT FAR, IN YOUR VIEW, OR NOT? >> WELL, WE MADE A -- WE HAD A MEETING YESTERDAY WITH SECRETARY PAULSON AND CHAIRMAN BERNANKE FOR SOME PERIOD OF TIME, OVER AN HOUR, AND WE DISCUSSED THOSE ISSUES. FIRST OF ALL, WE THINK THAT FROM THE STANDPOINT OF SECRETARY PAULSON AND CHAIRMAN BERNANKE, THEY BELIEVE THAT THE TARP PROGRAM HAS BEEN SUCCESSFUL, SUCCESSFUL TO THE EXTENT THAT THE VERY DEEP PLUNGE THAT THEY FEARED HAS BEEN STAUNCHED AND THAT THE -- AND THAT THERE'S BEEN A STABILIZATION IN THE FINANCIAL COMMUNITY, IF NOT NECESSARILY THE KIND OF PROGRESS WE WANTED IN GETTING LOANS MOVING THAT WE WANTED. WE ALSO DISCUSSED OUR DESIRE THAT THE TWO OTHER EFFORTS THAT YOU REFERRED TO, A, RELIEF FOR MORTGAGE HOLDERS, TO STABILIZE THE MORTGAGE MARKET TO GIVE -- TO GIVE PRICES TO HOMES, TO GIVE A VALUATION TO HOMES. WE BELIEVE THAT THE TARP OUGHT TO BE USED, RESOURCES FROM THE TARP OUGHT TO BE USED TO DO THAT. >> OKAY. >> AND FOR AUTOS, AND WE URGED THAT TO HAPPEN. >> WE ALSO INDICATED THAT WE THOUGHT IT WAS APPROPRIATE THAT A PORTION OF THE TARP MONEY, RELATIVELY SMALL IN TERMS OF THE 700 BILLION, APPROXIMATELY 25 BILLION, BE USED AND AUTHORIZED. WE DON'T BELIEVE THAT IT OUGHT TO BE USED NOW BUT WE BELIEVE THAT THERE OUGHT TO BE LEGISLATION AUTHORIZING THE USE OF $25 BILLION AS A BRIDGE LOAN WITH CONDITIONS ATTACHED TO IT FOR THE AUTO COMPANIES OUT OF THE 700 BILLION, NOT NEW MONEY, BUT OUT OF 700 BILLION BECAUSE WE BELIEVE BOAST THOSE EFFORTS GO TOWARDS THE OBJECTIVE OF THE TARP WHICH WAS, OF COURSE, TO STABILIZE OUR ECONOMY. >> LEADER HOYER, WHAT CONDITIONS WOULD THOSE BE THAT YOU WOULD ATTACH TO THE USAGE OF THE TARP FOR THE AUTOMAKERS? SOME SAY IT SHOULD BE MR. WAGONER LEAVING HIS POST AND OTHER IDEAS HAVE BEEN FLOATED OUT THERE. WHAT DO YOU THINK SHOULD BE ATTACHED THERE? >> FOR ONE THING, I THINK IT'S GOING TO BE A CAP ON DIVIDENDS, A CAP ON SALARIES, A CAP ON GOLDEN PARACHUTES, THAT KIND OF THING THAT WE'VE DISCUSSED WITH RESPECT TO THE FINANCIAL COMMUNITY. IN ADDITION TO THAT, THERE WOULD BE A REQUIREMENT THAT EARLY NEXT YEAR AND THERE ARE DATES BEING THROWN AROUND PERHAPS AT END OF THE FIRST QUARTER THAT THEY COME IN WITH A REORGANIZATION PLAN, AND THAT PLAN CONTEMPLATES A NEW BUSINESS MODEL FOR SUCCESS. OBVIOUSLY THE BUSINESS MODEL THAT HAS BEEN USED HAS NOT WORKED AND I'M SURE THERE'S A NEED FOR CHANGE. >> I'M SURE, SIR, YOU'VE GOTTEN RESISTANCE FROM SECRETARY PAULSON AND CHAIRMAN BERNANKE ON THOSE ISSUES, ON BOTH AVOIDING FORECLOSURES FOR HOMEOWNERS ON THE AUTO INDUSTRY. WHO HAS THE AUTHORITY, CAN YOU BIG FOOT, IF YOU WILL, AND GET THEM TO DO THIS WHETHER THEY WANT TO OR NOT OR DO THEY HAVE FULL AUTHORITY TO IMPLEMENT THIS MONEY HOWEVER THEY SEE FIT? >> THEY HAVE THE AUTHORITY RIGHT NOW BUT CLEARLY WE COULD PASSION LEGISLATION EITHER NOW OR EARLY NEXT YEAR WHICH WOULD DIRECT THEM TO TAKE SUCH ACTION OR TO AUTHORIZE SUCH ACTION BE TAKEN, FOR INSTANCE, IN THE AUTOMOBILE CASE, SECRETARY PAULSON IS NOT SURE THAT HE HAS THE AUTHORITY TO DO THAT AND HE BELIEVES THAT QUESTIONABLE. I BELIEVE CHAIRMAN FRANK BELIEVES THAT IT MAY BE ACCURATE AND THAT HE WANTS TO PASS SPECIFIC AUTHORIZATION FOR A SUM NOT TO EXSEED 25 BILLION TO BE EXPEND OUT OF TARP $700 BILLION SO THAT RIGHT NOW I THINK THE SECRETARY DOES HAVE THE AUTHORITY TO EXPEND THAT MONEY IN A MANNER HE BELIEVES THAT ACCOMPLISHES THE OBJECTIVES OF THE LEGISLATION, BY THINK WE CAN EXPAND UPON THAT AND FRANKLY WE COULD DIRECT HIM TO SPEND CERTAIN SUMS OUT OF THAT. >> OKAY. I KNOW YOU SPOKE TO THE NATIONAL PRESS CLUB. WAS IT THIS MORNING YOU MADE THE REMARKS. >> YES. >> AND I KNOW AMONG OTHER THINGS US A LAID OUT AN AGENDA FOR THE COMING YEAR, YOU ALSO SPOKE ABOUT FISCAL RESPONSIBILITY AT A TIME WHEN WE'RE SPENDING ALL THIS MONEY TO TRY AND REVIVE THE ECONOMY. I'M CURIOUS, YOU KNOW, PRESIDENT-ELECT OBAMA WAS ON ""60 MINUTES"" ON SUNDAY NIGHT AND SAID WE SHOULDN'T HAVE TO WORRY ABOUT DEFICITS THIS YEAR OR EVEN NEXT YEAR AS WE DO SPEND THE MONEY, WHATEVER IS NECESSARY, TO TRY AND, YOU KNOW, REVIVE THE ECONOMY AND KEEP THE FINANCIAL SYSTEM WORKING. ARE YOU IN AGREEMENT WITH ...