NBC News "Hardball" - Transcript: Pacific-Trade-Deal

Interview

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MATTHEWS: Senator Schumer, thanks for coming on tonight. We had the
president on yesterday, as you know. And he said he wanted me to go to
you. He said, I can`t explain Chuck Schumer`s position on this. Ask him.

And I was saying that you`ve always represented a financial center of
New York, which is generally pro-trade, but you also have to worry about
upstate New York, which is an old industrial area.

What it is in your constituency that you`re particularly concerned
about with regard to the Pacific trade deal?

SEN. CHUCK SCHUMER (D), NEW YORK: Well, it goes way beyond my
constituency, Chris. As you know, I`ve said this on your show, the
greatest problem America faces is the decline of middle class incomes. And
to me, trade agreements, while they may increase corporate profits, and
they may even increase GDP, (INAUDIBLE) help middle class incomes decline.
(ph)

And it`s obvious why. The studies have shown it. It`s obvious why
because of these trade agreements, our (ph) labor moves. The companies
move labor to the lowest-cost markets. And so I don`t -- I used to support
these agreements. In the Congress, I lost the AFL-CIO endorsement a few
years because I supported them. But when middle class incomes are
declining, these agreements don`t work well for America.

Now, one other point I`d make here, Chris. The number one thing I
feel is that China is the most rapacious trading partner we have. They
manipulate their currency, number one. Number two, they steal our
intellectual property. And worst of all, they don`t let our companies in
when they do good things. They`ve already accomplished that in low-labor
industries -- you know, furniture, toys, clothes. But now they`re doing it
in the high end.

And if you talk privately to our tech companies, our pharmaceutical
companies, our high-end manufacturing companies, the high end of America,
where the good-paying jobs are, China is not letting them in unless China
gets to steal their intellectual property in a company that`s 51 percent
owned by the Chinese.

So what I told the administration, if they would even -- I wouldn`t
even entertain supporting this agreement unless we had a currency bill that
went after China. And that is consistent with their view that you need TPP
to bring these nations away from China. So far, they`ve said no.

And I feel very strongly that we need to change the way we do trade
because it has been one of the major factors that lead to decline of middle
class incomes. I know you`ve said we`ve created 30 million jobs since
NAFTA. Since NAFTA, middle class incomes have declined.

MATTHEWS: He argues, the president...

SCHUMER: You know, you`re trading...

MATTHEWS: Well, let me ask you about...

SCHUMER: You`re trading high-end -- you`re trading high-end
manufacturing and service jobs for hamburger flippers.

MATTHEWS: But our...

SCHUMER: It`s more jobs. It`s less money.

MATTHEWS: The export market is based, the president argued yesterday,
on high-paying jobs. I`ve seen statistics that show that people make over
88 a year generally benefit from this because these are export jobs. You
don`t agree with that.

SCHUMER: I basically believe that until they stop stealing our
intellectual property, and until they stop keeping our companies out that
do good things, the amount we will gain from export jobs is minimized, and
the amount we lose in middle class incomes is maximized.

The currency bill we have would finally do something for China`s
rapacious policies. And so far, the administration -- they`ve talked to
me, but they refuse to do it.

And everyone -- you know, you talk to corporate CEOs, Chris, the
people who are for these bills, they say on China, Chuck, you keep doing
what you`re doing. We can`t say anything because China retaliates against
us, but you keep it up.

MATTHEWS: What about a deal? Can there be a provision in this before
it`s finished that does have something on -- that stops these companies
from deflating their currency and playing these manipulation games?

SCHUMER: Yes.

MATTHEWS: How do you do it?

SCHUMER: That`s what I proposed to the administration.

MATTHEWS: Without affecting our own Fed and our own ability deal with
our own -- does this...

SCHUMER: Our -- our proposal...

MATTHEWS: Does it interfere with our abilities?

SCHUMER: Chris, our proposal, which is bipartisan, does not affect
QE2 or anything we do for monetary policy. It simply affects currency
that`s being manipulated for trade.

MATTHEWS: Are you still in this deal? In other words, if they do the
right thing by you, could you still be supportive of this by the time it
goes to a vote, up or down?

SCHUMER: Look, I am deeply skeptical of trade deals in general for
the reasons I`ve outlined. But the only way they can get a number of
Democrats is by doing a strong real currency bill that goes after the worst
of the trading partners, the one that`s stealing our high-end jobs...

MATTHEWS: Right.

SCHUMER: ... our high-end industries, China. So far, this
administration, the Bush administration have done nothing. And as China
has manipulated its currency, we`ve lost trillions of dollars of wealth and
millions of good-paying jobs.

MATTHEWS: Let me ask you about the politics. Last question, Senator.
Thanks for coming on tonight, especially tonight. What about the Clintons?
Bill Clinton is for this. He was for NAFTA. I heard him over in Tokyo
when I was over there for the -- for the -- St. Patrick`s day, it was. He
came out all (ph) said it was a great bill. Secretary Clinton was for it.
She called it the gold standard when she was secretary of state.

Isn`t this a big political fight for the Democrats?

SCHUMER: Well, look, I think the Clintons are going to make their
decision based on the merits. And their focus, like mine, is on middle
class jobs. And so we`ll see where they come out. We`re in a different
world than 1994. The China we dealt with in 1994 is a lot different than
the China today. You talk to...

MATTHEWS: Well, but Bill Clinton is for this now.

SCHUMER: You talk to our best companies, our Googles, our Apples, our
Microsofts. They will say nothing. But when you talk to some of these
companies -- I`m not saying these three. I don`t want -- but our best
companies will tell you China steals their property and keeps them out and
then manufactures it -- they manufacture it themselves, and then they send
it here using currency manipulation to get an artificially low price.
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MATTHEWS: Well, last word from the president, just repealing (ph)
what he said last night. He said if we get out of this business of trade
expansion, we turn it over to the Chinese. This brings us into partnership
with 11 other Pacific Rim countries.

SCHUMER: You know what?

MATTHEWS: And we could go to war with China more effectively. Your
thoughts.

SCHUMER: Chris, if we don`t do currency, we`re turning over our
economy to the Chinese. The way we`ve turned over the low-end stuff, we
will turn over the high-end stuff.

And I feel a passion about this. It`s not political for me. It`s
substantive. I truly believe that America`s greatness and billions and
billions of dollars of our wealth flows away because China doesn`t treat us
fairly.

And we can do something about it, and this is the best time to do
something. That`s why I`m pushing my currency bill as part of this
program.

MATTHEWS: OK. Thank you so much, Senator Chuck Schumer of New York.

SCHUMER: Thanks, Chris.

MATTHEWS: Thanks for coming on, Senator.

SCHUMER: Bye-bye.

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