Fox News Channel Interview - Transcript

Interview

Fox News Channel Interview - Transcript

FOX NEWS CHANNEL INTERVIEW WITH SENATOR CHARLES SCHUMER (D-NY)
SUBJECT: ECONOMIC STIMULUS PACKAGE INTERVIEWER: SHEPARD SMITH

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MR. SMITH: Well, we're talking about the stimulus plan that was passed today on Capitol Hill by the Senate. Now, they have to get together with the House and put their two bills together and reach a compromise before sending it off to the president's desk for signature. That will be a tall order. But let's talk about what's happened so far.

With us now from Capitol Hill, a member of the Senate Banking Committee itself, New York Democrat Senator Chuck Schumer.

Senator, good to see you. Thank you.

SEN. SCHUMER: Good afternoon, Shepard.

MR. SMITH: Great talk and exciting to hear about this concept of transparency, and yet today, it sounded as if what we got from Tim Geithner was about $1 trillion, which would go through the Fed and to many felt like an end run around Congress. As a senator, how do you feel about that?

SEN. SCHUMER: Well, you know, the Fed always has an ability to back up different kinds of things, the FDIC and others do. This is not taxpayer dollars the way the TARP would be. It doesn't come out of the federal budget.

MR. SMITH: Where does it come from?

SEN. SCHUMER: It's traditionally -- it's the Federal Reserve. They have all these gold reserves and then they can leverage them and they use them from time to time. So I don't think it's an end run and I don't think it's going to be $1 trillion.

MR. SMITH: The market didn't like this at all today. The market seems to be saying, we want more specifics. We want to know how, in fact --

SEN. SCHUMER: Right.

MR. SMITH: You're going to get the credit, get the money flowing again on one end and on the other side, we want to know how homeowners are going to be helped and they didn't seem to get the answers they wanted.

SEN. SCHUMER: Well, on the homeowners, I think, that there's going to be a separate proposal. I think President Obama is going to make that himself and I think it's going to be a good one. It's going to focus more on the servicers and the bond holders. If they're not playing ball and if they're not forced by sticks and lured by carrots, they're not going to be part of this and so that will be good.

In terms of the specifics of the Geithner proposal, I think those will be coming out and I think when the markets hear those, they're going to be much more pleased because it's a thoughtful proposal. They gave the broad outlines today, but the details, of course, will be coming out.

MR. SMITH: You know, the frustrating thing though, senator, and I apologize for interrupting, it's just the satellite delays --

SEN. SCHUMER: Please.

MR. SMITH: The frustrating thing is, the president said last night and he's said for so many days and weeks now about the fierce urgency of now, we have to do this right now, or in his words, we face the potential of catastrophe, and yet today what Tim Geithner said was, we don't have a plan yet. We don't have a plan for how to value troubled assets and unless and until you value troubled assets, this is not going to be fixed.

SEN. SCHUMER: Well, let me say this, Shepard. On the stimulus, I think we have to act quickly. There are thousands of people who lose their jobs every day. The economy is hurtling downward. We don't want to get into a deflationary spiral. On the banks situation, that's brave new world, unchartered waters and on that one, doing it carefully rather than doing it quickly makes sense. Secretary Paulson and President Bush did it quickly and it didn't work very well.

MR. SMITH: Well, Tim Geithner was there in the middle of all that, too, and it didn't work very well and it seems to throw the last administration under the bus, I kind of went, you know, you were there, you were at the Fed. But still I mean to hear that this has to be done right now, we have to go right now and to hear today in essence, we don't have a plan yet, it's my sense that that and those of our business team that that's what rattled the market today, fair enough?

SEN. SCHUMER: Well, I think the market is very, very worried and they were hoping for more detail. I wouldn't deny that. But I think when they hear the detail; they're going to feel pretty good. I think this is a smart, thoughtful plan that says one size doesn't fit all. We're going to do different things for different banks. There will be more transparency, more conditionality.

MR. SMITH: Well, what that sounds like is the federal government is going to decide who wins and who loses. That doesn't sound a lot like capitalism.

SEN. SCHUMER: Well, I think that they're going to back up these banks, but they're not going to make the decisions. Nobody wants to nationalize the banks, Tim Geithner nor anybody else.

MR. SMITH: Of course, if we stayed -- if you make a risky bet and you lose, then you're done and if you win, you're good if we stayed with that from the beginning, we wouldn't have a lot of craziness going on, would we?

SEN. SCHUMER: Hey, there's not a good choice here. This is a big, huge mess, the likes of which we've never seen, but I do have some faith in Geithner and Summers coming up with a very smart plan. But I think it's going to take a little time and they're going to have to sort of figure it out as they go step by step.

MR. SMITH: Senator, we look forward to hearing it. Senator Chuck Schumer of New York. Great to see you. Thank you.

SEN. SCHUMER: Thank you.

END.

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