Fox News Channel "Your World" Interview - Transcript

Interview

FOX NEWS CHANNEL "YOUR WORLD" INTERVIEW WITH REP. JAN SCHAKOWSKY (D-IL)

INTERVIEWER: NEIL CAVUTO

SUBJECT: AIG BONUSES

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MR. CAVUTO: All right. Well, a lot more growing anger over AIG and what they're already calling "Bonusgate." AIG getting billions of taxpayer cash, the company still losing billions and paying millions in bonuses to the guys who lost the billions. More people now saying that this mess proves it is time to stop the bailouts. My next guest disagrees. Jan Schakowsky is a Democratic congresswoman from Illinois.

Congresswoman, good to have you.

REP. SCHAKOWSKY: Good to be with you. But I don't disagree. But if we do bailouts, it's going to be on very different terms, Neil. There's not going to be anymore bonuses. There's not going to be anymore perks. And if the banks don't want them, institutions don't want the money, then they can give it back or not get it.

MR. CAVUTO: Bless you, Congresswoman. That's the exact same thing I didn't hear from a lot of your colleagues after this weekend massage retreat that AIG had a few months back. And they said, you know, we're never going to let that happen again and trust us on this, and it happened again. So it seems like no matter what mousetrap Congress comes up with, whether it's AIG or whatever, they're (smarmy ?) mice. What are you going to do?

REP. SCHAKOWSKY: Well, for one thing, we're going to assert our ownership rights. That's one option. You know, the taxpayers own AIG 80 percent of it.

MR. CAVUTO: Well, then act like it. Act like it. You know what I'm saying? I mean, assert your ownership rights. Part of the ownership rights is looking at every penny that's being spent. I heard from the former CEO that these bonuses were well publicized, very transparent, actually given in a file to regulators. And regulators or whoever the congressional counterparts are either ignored it, didn't open it, moved on from it. What do you make of that?

REP. SCHAKOWSKY: You know, and agreed to well before the Obama administration. The outrage level in the Congress cannot exceed yours, Neil. We are so furious at this, that the taxpayers would have to give 73 people over $1 million. Eleven of them who are getting retention bonuses are gone from the company. One guy that makes over $4 million.

MR. CAVUTO: I'm well aware of that. So what are you going to do to stop it? Because if it's not AIG, there's another institution that does it. I guess all bonuses are out. You're not going to get paid. You've got the $500,000 pay cap. And yet these guys still find a way to worm around you. What kind of worm-proof medicine do you have?

REP. SCHAKOWSKY: Here's what we did. In the recovery bill, we said, number one, we're not going allow any of this money to go for bonuses or perks. This is all now under the Obama administration, things that happen now going forward. And we're going to allow the companies to give the money back. And I just talked to Barney Frank, chairman of our Financial Services Committee. He told me that Northern Trust Bank in Chicago is going to give their TARP money back. You know why? These banks are complaining because they want to be able to give these bonuses and perks. Well, it's not going to happen with taxpayer dollars.

MR. CAVUTO: Well, Northern Trust is in far better shape than AIG. So AIG is not in any position to give so much as a penny back at this point. So what I'm asking for the AIGs of the world and those that are far less healthy than some of these institutions that are saying, no mas on this dough from you guys, what are you going to do?

REP. SCHAKOWSKY: That's what I said. We're going to make sure that that money does not go to them. In fact, I signed onto a bill that says that those bonuses are going to be taxed at 100 percent. I don't know if we can do that, but there's bills that say we're going to tax them at 90 percent, 80 percent.

MR. CAVUTO: Well, that's silly, Congresswoman. I mean, now all of a sudden you're trying to redo the tax law to address something you should have seen at the beginning, right? I mean, just stop the bonuses stuff and then, oh, if you do sneak it through, we're going to tax you at 100 percent. So put that aside. That sounds silly.

REP. SCHAKOWSKY: But I think the message of that is that we're not going to let it happen. You heard the president himself. It's just absolutely infuriating, and we're looking at it.

MR. CAVUTO: Congresswoman, I know you're livid. I know the president, everyone is livid. And I'm not taking anything away from you. You're hardworking, you know, Congresswoman, you're trying to do the right thing. But this keeps happening. I'm telling you, the taxpayers are saying, stop this nonsense, just stop, get off this train, it is crashing.

REP. SCHAKOWSKY: Absolutely. And I think that the Congress is somewhat embarrassed as well as infuriated.

MR. CAVUTO: Well, would you ever let an AIG go under? Would you ever let the private market decide its fate, spin off its insurance business, spin off its casualty business, spin off some of these financial products businesses and let the markets decide if there are any buyers for them rather than Uncle Sam, rather than us propping those businesses up?

REP. SCHAKOWSKY: Well, maybe you know more than I do, but some of these companies, if it means that the whole house of cards is going to tumble and the economy is going to go completely kaput, then I think that we have to look for some solution. And if it's the United States government, as we do own 80 percent of AIG, then we have to be better managers of this. But to just say, well, to hell with them, we're going to let them all go, I think, in some cases, may not be the answer. But we can't let this irresponsible action of people getting $6.4 million. That's not going to happen, Neil.

MR. CAVUTO: Let's hope not, Congresswoman. Thank you very much.

REP. SCHAKOWSKY: We'll see. We'll see.

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