CNBC - Transcript

Interview

MR. QUINTANILLA: This economic stimulus plan on the Hill, the proposal is being put through their paces in Congress this week and potentially next.

Joining us from Capitol Hill, Majority Leader Democratic Congressman from Maryland, Steny Hoyer joins us, along with Leader Armey here on set.

You guys know each other, right, Leader Hoyer?

REP. HOYER: We do.

MR. ARMEY: Yes, we do.

MR. QUINTANILLA: You go way back.

MR. ARMEY: Steny Hoyer is my wife's favorite Democrat, so I cannot be mean to Steny Hoyer or I'll be in trouble when I go home.

MR. QUINTANILLA: That's good stuff. Leader Hoyer, let me start with you in the stimulus, obviously, in appropriations it went along party lines even despite these attempts by Republicans to massage it somehow, put PAYGO in one way or maybe make sure that this CBO report about how the money would come too late that that doesn't happen.

Are those voices going unheard at all in your party?

REP. HOYER: We're going to have continuing discussions on what's going to be in this. I had some discussions yesterday with some Republicans about amendments that they'd like to offer and we're going to continue to discuss these. President Obama has said he wants to reach out. We're having a bipartisan meeting at the White House on Friday.

So there are going to be a lot of discussions before this package is finished, but we need to act quickly. We need to infuse the economy with, not only dollars to grow the economy, but to grow confidence and also we have to deal as we dealt last night in the House of Representatives with a package, which will bring greater accountability, transparency and really help for mortgage holders to the TARP program.

MR. QUINTANILLA: How firm are you in sticking with, A, the size of the package? And B, the mix of spending, the tax cuts? Are those non-negotiable?

REP. HOYER: Well, I don't think they're non-negotiable, but I think they have been the result of an awful lot of discussions, not only between the Obama administration that's now in office and the Democrats in the Congress, but also with Republicans and Republicans in the administration.

I've had talks with Secretary Paulson as recently as last week, but the fact is that we think almost every economist says we need to act, we need to act boldly, we need to act with significant resources and we need to act relatively quickly.

MR. QUINTANILLA: Leader Armey?

MR. ARMEY: Well, first of all, my hat is off to Steny Hoyer. He's got an extremely complex job and he manages it well. There are so many factions even within his party. Differences of opinion between the new president and the Speaker of the House, as well as differences between the House and the Senate and Steny negotiates, I think, with a great deal of ability and I admire what he does.

I, frankly, am in that group --

REP. HOYER: I feel the bad news coming.

MR. QUINTANILLA: Here it comes.

MR. ARMEY: Here comes the knife in the back. I'm in that group of economists that says that the fact of the matter is they acted with this enormous big panic last fall with this big bailout package that, frankly, they've done nothing but probably exacerbate the problem.

I don't think they're going to do a whole lot of good -- this whole stimulus package is more of a political exercise than it is an exercise in sound economic policy.

MR. QUINTANILLA: That's a lot of --

REP. HOYER: Let me say that Dick and I, as you could tell, are friends. We worked together, but we have very significant differences, and very frankly, Dick has very significant differences with the Bush administration and the economic leaders in the Bush administration.

So there is a significant difference of opinion as to whether or not we need to act and how large the action needs to be. Marty Feldstein says we need to act both with spending and with tax cuts, which is what we're doing.

MR. QUINTANILLA: Congressman, Leader Hoyer, one thing that people keep talking about, the way to get this anchor off the banks would be to somehow change mark to market accounting, change the accounting rules. Some who are close to the Obama administration say that that's not impossible.

Is that ball beginning to roll on the Hill?

REP. HOYER: I think there's certainly discussions about that. There are differences of opinion as to how much of a role that played in the crisis that confronts us, but nevertheless, we need to discuss all the options available to us to stabilize the financial markets, to give value back to homeowners so that they can feel confidence in going out and purchasing goods and not be worried about the value of their home.

There are a lot of things that we need to do and we need to consider every option. Lyndon Johnson once said, it's not difficult to do the right thing, it's difficult to know what the right thing is, and I think that's really the problem that we're confronting in the Congress and in the country.

How do we stabilize the economy? Everybody wants to do that. We want to get us back on track, but how exactly you do that, frankly, is a subject of real debate, but we've made progress, I think. Many economists would say if we had not acted earlier in the year, last year, the economy would be in much worse shape than it is now and it's in bad shape.

MR. ARMEY: Well, again, I guess I'm always going to be the skunk at this garden party. My view is that the economy took a terrible nosedive precisely because the president and the Secretary of the Treasury had a very public panic, again, I was cautioned even as majority leader, a relatively insignificant position in the government, hardly recognized by most of the people in America, be careful what you say because what you say can move markets.

For the President of the United States, the Secretary of the Treasury to run out and to announce to the nation that the economy is going to heck in a hand basket did probably more to create the circumstance we're in today than any other --

MR. QUINTANILLA: Well, in his defense, the president didn't -- I mean, there were others who said, where is he? He did spend a couple of days trying to let things simmer before he came out and some peoples' minds had to acknowledge what was happening on the street.

MR. ARMEY: Yeah, he certainly didn't introduce the calming voice that you might have gotten --

MS. QUICK: Although, Leader Armey, we talked to people --

REP. HOYER: Well, I hate to interrupt this attack by Dick Armey on the previous administration, but in any event, we are where we are. We need to act. It's almost universally agreed that we need to take significant action to restore confidence and restore stability. That's what we're about and we're working with the Obama administration and the Congress, and we certainly want to work with the Republicans across the aisle, both in the Senate and the House.

MR. QUINTANILLA: We will see a House vote on stimulus next week?

REP. HOYER: That's correct.

MR. QUINTANILLA: And although it's on the Senate side, your view of how Tim Geithner is doing on the Hill, people want to say he's getting through.

REP. HOYER: I think Tim Geithner is going to be confirmed. I think Tim Geithner has confidence in the financial markets and I think the Obama administration wanted to reach across the aisle, in effect, and make sure that we had some stability between the last administration and this administration, not because we agreed with all the policies, but because we agreed that we need to keep our eye on the ball and we think Tim Geithner will do that.

MR. QUINTANILLA: The notion of some sort of aggregate bank. Is that gaining or losing support as we speak?

REP. HOYER: I certainly think it's a significant focus of discussion that's been tried before, in some instances, it has worked and we certainly know that the original TARP concept, of course, was to take the bad assets, the toxic paper if you will out of the banks so that they would be, again, stabilized and people would have confidence in them and they could be, again, be confident in making loans.

So that is certainly under very serious consideration.

MR. QUINTANILLA: The problem for Americans is you told, not you necessarily, the government said one thing, went the other way, now we're back. At some point, you're going to need to convince them this is the plan; this is not going to change again.

REP. HOYER: I agree with that, of course, and Dick Armey is, I think, correct to the extent that a lot of things were said by the previous administration's representatives, came in and perhaps were not helpful, but the actions they took at the time when they reconsidered buying the troubled assets and infusing capital, I think given the circumstances that existed at that point in time was a reasonable change of plan.

MR. QUINTANILLA: We have to go, congressman, but have you spoken to the president in the past couple of days?

REP. HOYER: I spoke to him yesterday.

MR. QUINTANILLA: Did he say anything interesting?

REP. HOYER: He always says things that are interesting.

MR. QUINTANILLA: Nothing you can share? Any color -- you can give us in terms of his own state of mind or how he feels first 24, 48 hours into the term?

REP. HOYER: Well, I think he has a very positive state of mind. He made representations to the country what he was going to do as president. He undertook that yesterday, took some very significant steps and met with our national security team or his national security team, our national security team, met with his economic team, obviously, those are two of the critical items.

He acted quickly to bring transparency and accountability to the White House so the American public knows what's going on. He acted quickly with respect to Guantanamo to send a signal that we're going to close Guantanamo, it may take a year or so, I think, less than a year. But he briefed us on that action.

So I think that he's taking the reins. He's a confident, positive leader and I think can galvanize the American people to solve the problems that confront us.

MR. QUINTANILLA: Leader Hoyer, appreciate it and good seeing you as always.

REP. HOYER: Thank you. Good to see you.

MR. QUINTANILLA: We'll talk to you soon in the weeks to come.

REP. HOYER: All right. Bye bye.

END.

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