CNBC Kudlow & Cramer - Transcript

CNBC News Transcripts

SHOW: Kudlow & Cramer (5:00 PM ET) - CNBC

HEADLINE: Senator Susan Collins of Maine discusses the 9-11 Commission report

ANCHORS: JIM CRAMER; LARRY KUDLOW

BODY:
JIM CRAMER, co-host:

9-11 Commission report blames a lack of congressional oversight for at least some of what happened; proposes a number of remedies, including new permanent domestic security committees. Here with the reaction from Congress is Senator Susan Collins, Republican from Maine. Senator Collins chairs the Governmental Affairs Committee and also serves on the Armed Services Committee.

Welcome back to the show, Senator Collins.

Senator SUSAN COLLINS (Republican, Maine): Thank you.

CRAMER: It concerns me that there's a rhetoric about the commission, which is that there are-a lot of people are saying, 'Hey, well do you really feel safer?' Isn't that a bit of a canard? I mean, frankly, wasn't the idea that we felt so safe what caused the towers to go down to begin with?

Sen. COLLINS: That's a good point. There was a sense of complacency. The commission found that both administrations did not take seriously enough the terrorist threat, although they certainly recognized that it was out there. I think the commission has performed an outstanding public service. I'm impressed that the report is unanimous. And the recommendations, both for Congress and the administration, should be very helpful.

LARRY KUDLOW, co-host:

Senator Collins, you are known as an objective observer, frankly, far, far, far less partisan than your average run-of-the-mill US senator. Let me ask you this: Congressional oversight is one thing, but it was Congress that voted in the '90s to defund the Central Intelligence Agency. It was Congress that put very strict restrictions on the hiring of human intelligence. And it seemed like it was the Congress that just was very short-sighted in its intelligence policies. So what we have here is a policy problem. And my question is: Will it change?

Sen. COLLINS: I think it will change. There's no doubt that Congress is part of the problem. The commission does not spare Congress at all. There was a cutback in funding for human intelligence, and I think there was sort of a blind faith that we could somehow do our intelligence just with electronic means and satellite. We seem to have devalued in the 1980s and the 1990s the human element, and yet we know that that is absolutely critical in dealing with terrorist organizations, like al-Qaida. So certainly Congress dropped the ball, and we need to reform as well as implement the reforms that will apply to the organization of intelligence agencies in the executive branch.

CRAMER: Senator Collins, both Larry and I have been in favor over time for an MI-5 situation for domestic intelligence. The commission doesn't recommend it. Do you think the commission's wrong?

Sen. COLLINS: I don't think so. I'm very much in favor of two major recommendations of the commission: One is to have a national intelligence director, who can coordinate the 15 intelligence agencies that we have now and allocate resources appropriately; and the second is the creation of a national counterterrorism center, which should be a greatly expanded and stronger and more independent version of the Terrorist Threat Integration Center created by President Bush. That center was a great step in the right direction, but I agree with the commission that we need to beef it up.

KUDLOW: Well, Senator, if you have one strong person who's supposedly going to knock heads-I mean, after all, that was what the DCI was originally there for; the director of Central Intelligence was supposed to be the overall. The trouble is the Pentagon has, by far, the biggest intelligence budget. So my question to you is: If you create this national intelligence director, will you give that person the strict budget authority to make the tough decisions and knock heads together?

Sen. COLLINS: In my view, we have to, or we will not accomplish the goal. Right now there are so many turf battles still in this post-9/11 era among the 15 intelligence agencies. I visited the Terrorist Threat Integration Center recently, and the director told me that it was a challenge to get all of the various agencies represented there to commit experienced personnel and the resources necessary to carry out the mission. We need to make sure that there is one person who can make those budget allocations and ensure that we're putting the resources where they need to go, not depending on whether it happens to be located in the Department of Defense or at the State Department or at the CIA or at Justice.

CRAMER: All right. Senator Collins, just in the little time we have left, just to divert for a second, New York Times-incredible series of articles: GI insurance, predator companies working hand in hand both with people in Congress and with the military. When are we going to blow this thing wide open? Let's get some names, let's find out who did this. You know that this is just as bad as Enron and WorldCom, if not worse.

Sen. COLLINS: I was appalled to read that series. The idea that our servicemen and women are being ripped off by being sold insurance that doesn't do what they think it does, when the military has a program that would meet their needs, is just completely unacceptable. I think the Pentagon and Congress really need to crack down in this area, with help from the SEC and state regulators.

KUDLOW: Amen to that. Senator Collins, just in a very brief time remaining, we talked about the defunding of intelligence in the '90s. It seemed like a peacetime thing. But it turns out terrorism was the last 'ism,' after communism, Naziism and fascism. We have a war on our hands. Is it your view that the Congress appreciates this war and will do what it takes to beef up our intelligence system to protect our shores?

Sen. COLLINS: We simply must. This is the greatest threat not only to our country but to our civilization that we have faced since not only communism but probably since Naziism. And we have to treat it the same way. We have to have the same sustained commitment. We have to recognize just how serious this threat is, and it's going to be a long battle.

KUDLOW: Senator Susan Collins, we really appreciate your coming on, on a busy day, with this report. Hope to see you soon.

Sen. COLLINS: Thank you.