CNBC INTERVIEW WITH REP. GREGORY MEEKS (D-NY) AND REP. JEB HENSARLING (R-TX)
SUBJECT: OBSTRUCTIONISM AND THE DEFICIT INTERVIEWERS: BILL GRIFFETH, SUE HERERA, MICHELLE CARUSO-CABRERA
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MR. GRIFFITH: But we want to get to a couple of congressman who will participate in tomorrow's hearings of the House Financial Services. They will hear testimony from Chairman Bernanke, and they both have been very kind to wait around, and we want to get to them first so you don't have to wait much longer.
Welcome to Jeb Hensarling of Texas and Gregory Meeks of New York. Gentlemen, thank you both for joining us today and your patience there.
REP. MEEKS: Good to be with you.
REP. HENSARLING: Thanks for having me.
MR. GRIFFITH: You know how those hearings can go, huh? (Laughter.)
REP. HENSARLING: Well, particularly on the Senate side, they talk too long.
MS. HERERA: (Laughs.)
MR. GRIFFETH: Well, that never happens on the House side, does it, Congressman Hensarling?
MS. HERERA: No.
MR. GRIFFETH: What struck you, Congressman Hensarling, about the testimony we heard? I mean, we were -- we were pretty transfixed, I have to say, as Chairman Bernanke was explaining the process of the stress test and the transparency that he sees coming in all of this. I know you're not a big fan of any of this, but are you little more comforted by what you heard today?
REP. HENSARLING: Well, I hope to be comforted in the days and weeks to come. I mean, something I think the chairman hit upon in his testimony, or at least in answers to questions, is that one of the things the market needs is certainty.
I mean, there is trillions of dollars sitting on the sidelines, but people don't know, are you going to bail me out, are you going to bail my competitor out, are you going to bail my customer out? And at this point, we need some certainty. We certainly didn't hear it from Secretary Geithner a couple of weeks ago, which was very disappointing, and we can see the results in the marketplace.
On the other hand, what I want to hear from the Fed -- and I didn't hear enough of it today -- what is the exit plan? I think a lot of what the Fed has done has been proper under the circumstances, but pouring this massive quantity of capital into the system to prevent deflation is, frankly, the easier thing to do than to take it out of the system when we have the threat of inflation. And I hope and pray we're not on the road to Japan's lost decade. I hope we're not on the road to the Jimmy Carter era of high unemployment, high inflation --
MR. GRIFFITH: Okay.
REP. HENSARLING: -- and high interest rates. We don't need stagflation, and we need to hear more.
MR. GRIFFITH: Congressman Meeks, obviously there's some impatience in some corners, waiting for some sort of results or at least let the process begin here. Are you satisfied with how the Obama administration and the Fed and some of those in government are proceeding with this, and in fact, how they are explaining the process and how's it going to happen here? I mean, I think that's what some people are frustrated about, is they keep hearing the anticipation is there, but they're waiting for the process actually to begin. Are you satisfied with how this is unfolding right now?
REP. MEEKS: I think they're being very prudent in how they're proceeding. You know, what happens oftentimes when you're in a crisis like this, someone wants immediate results, and that can cause a panic. And a panic then generally means that you do the wrong thing.
I think that what President Obama's doing and the administration is bringing the best minds that he knows of together. That's not just people from the Democratic Party or the Republican Party; he's bringing the best minds from both the left and the right together, and they're working through it. And they're putting together -- and I think that's part of what you're going to also hear tonight -- they're putting together an extensive package of ideas and items that will bring us out of this situation, the key of which -- and which -- and I agree with you, it was captivating listening to the last part of the Senate hearing, and I look forward to having the hearing tomorrow -- is trying to figure out how we do value the toxic assets.
MR. GRIFFITH: Right.
REP. MEEKS: I think that's the fire, and that's what we've got to figure out. And once we can figure out the value of the toxic assets, then we can induce more private investment, and that will then begin to get us out of the doldrums in which we're currently in.
MR. GRIFFITH: Okay.
MS. CARUSO-CABRERA: Representative Meeks, Michelle here. You know, we heard from President Obama three times yesterday in live appearances. He's going to be on again tonight. We're starting to hear increasing criticisms from folks saying, "He keeps talking, and we need less talking and more governing." We keep hearing that there's going to be a plan. we keep hearing that there's going to be details. What do you say to those folks that he's spending too much time talking and not enough time doing?
REP. MEEKS: Well, I think that what he said all along during the campaign and what he's doing here, he's trying to be open and honest to the American people to let them know the exact situation that we're currently in. If he wasn't saying anything, people would say, "Well, where is he?"
As the plan develops -- as opposed to being quiet on the sidelines as the plan is developing and being -- and evolving, he is allowing the American people and telling the American people where he is in the process and where we're moving. I suspect that we're going to hear tonight. More meat is going to be put on the bones. He's going to show us the direction that we're going to be -- we're headed in.
: I doubt it.
MR. GRIFFETH: By the same token, though, Congressman Hensarling, you are mindful, I'm sure, the results of this poll that was in The New York Times this morning showing astronomical poll results for the president, the optimism that people feel under the Obama administration and, in fact, with all due respect, the view, in this poll, that the GOP may be a bit obstructionist in the way it is working with the administration or not working with the administration to try and come up with a plan to revive the economy. How do you respond to that? And what is the strategy now for the GOP?
REP. HENSARLING: Well, the latter proposition is laughable. Listen, elections have consequences. The Democrats won fair and square. It's majority rule around here and we don't have a majority, so I think it's impossible to be obstructionist.
We were disappointed that Speaker Pelosi did not work with the Republicans, not one bit. I give the president credit -- he came, he spoke to Republicans -- but we have different ideas. I mean, Republicans do not believe that ultimately the road to recovery leads through the halls of Congress. It's doesn't lead through Wall Street. It leads through the small businesses of Main Street. And that's why we offered legislation that would put more capital into the hands of small business to preserve jobs, grow jobs, tax relief to struggling families, and do it in such a way that doesn't send an unconscionable burden of debt to our children and our grandchildren.
And unfortunately, the president's plan -- I know he's calling for fiscal responsibility; now's kind of a fine time to say it. Listen, I don't legislate by the polls. I try to do what I think is right for the American people --
MS. HERERA: Yes, and --
REP. HENSARLING: -- and it has to be with creating and preserving jobs through small businesses.
MS. HERERA: And, Congressman Meeks, very quickly, the president has also said, in addition to solving the economic crisis, one of his goals is to cut the deficit dramatically. How is he going to do that with all of the spending that's contained in some of these measures? How is that going to work, do you think?
REP. MEEKS: Well, I think that when you look at where we are now, and we moved back -- and he's already talking about allowing the Bush tax cuts to expire. That's going to bring some more money back into the budget so that we can begin to reduce the deficit.
When you look at the amount of money that we're spending, actually, it is -- you know, soon as we can start digging out of this crisis, it'll be easier to start curbing back, and we've got to control spending. I agree with my Republican colleagues. We will -- we will have to control spending. We'll have to do some of the same measures that was done back in the '90s, when we had a balanced budget.
But It's going to take some time, and I think that the president's talking about two years. And we're going to -- you know, this is an emergency situation that we're currently in. So we've got to spend and we're increasing the debt like, you know, that -- like has never happened before.
MR. GRIFFETH: All right.
REP. MEEKS: But we've got to reduce that, and cut back on spending as we move forward and as we begin to climb out of the current situation.
MR. GRIFFETH: Gentlemen, again, we are grateful for the time you waited, and we hope that you got your message for us today, and we thank you for joining us. We'll see you tomorrow during the hearings tomorrow.