CNBC "Street Signs" Interview - Transcript

Interview

MS. BURNETT: Lawmakers are trying to deal with the emergency request to spend the biggest amount of taxpayer money ever. We've broken it down over our reporting over the past few days here in Washington to five issues that the market and taxpayers are focused on.

Here's what may go in or out of the legislation; limits to CEO compensation at banks that participate. This is crucial. The other issue up for discussion, whether taxpayers should have a stake in bank stocks that participate. Third, should we pay for the plan in installments instead of authorizing $700 billion all at once? And fourth, requiring banks, perhaps to pay small fees into a pool that would help pay for the plan so it's not just taxpayers. Banks help. And finally, requiring a full overhaul of our nation's financial regulation system by this spring, something Charles Schumer brought up just this afternoon.

Some of those points may end up in the final legislation. One other thing sure to be there, of course, is assistance for Americans facing foreclosure in some form or another.

So where do we stand right now?

Our guest today is part of the hearings; Congressman Lloyd Doggett is with us. He is a Democrat from Texas and he, obviously, was with the Joint Economic Committee this morning.

We appreciate you taking the time, Congressman Doggett, to take out of a busy day to be with us.

REP. DOGGETT: It is a hectic time and thank you very much.

MS. BURNETT: All right, sir. Well, we had just broken it down to, obviously, a bailout plan and some of the things that may go in or out. First, the bottom line. Do you join your comrades like Senator Schumer who say this will get done?

REP. DOGGETT: Well, I join Senator Schumer and all of us, really, who want to be sure we take no action that would encourage any further deterioration in this poor Bush economy, but whether this particular plan will be approved remains to be seen.

I think Congress will take prompt action, hopefully, not irresponsibly prompt action, but thorough and deliberate consideration and the five issues you mentioned are absolutely essential for any plan that's approved. I think we need to do a bit more than that.

MS. BURNETT: All right. So let's talk about those and specifically then, sir, because obviously -- what is the plan particularly going to be? It depends which of those five things goes in and perhaps if you have something else you are looking at. We talked about CEO compensation. We talked about paying for this potentially in installments or taxpayers getting equity stakes.

Which of those things do you think will end up in the final legislation?

REP. DOGGETT: Well, what has not gotten enough attention in this legislation is how it will be paid for? The notion that like everything else President Bush has done at home and abroad that we would just borrow the money and spend it and add another $700 billion to our soaring national debt borrowed from abroad, I think it's not responsible and President Bush tonight in addition to apologizing to the American people for causing this disaster, ought to be explaining how it will be paid for and I don't think looking at the people that weren't invited to the party to pay for all of it is the right way to do.

You mentioned the possibility of banks being asked to pay something after the savings and loan debacle. The federal home loan banks were assessed a 20 percent, I believe, of the bond cost, a fairly modest amount. I think we should be looking at how to pay for this in an alternative way than just asking future generations to be paying the interest on the borrowings of such a huge amount.

MS. BURNETT: So do you think that we will end up with some sort of a hybrid plan before Congress goes on recess, whether it's Friday or Sunday, where you have taxpayers paying for part of it, but banks paying for part of it in some sort of specific formula? Do you think we'll get to that point?

REP. DOGGETT: I personally think we would be better advised to look carefully at this plan to indicate that there is consensus for adopting a plan in the near future, but take Sunday off and come back here next week after the Jewish holy days and get the job done at that time.

I think that it is essential that an entire $700 billion that that be split. As the testimony indicated this morning, they can't spend all that money in the first three to six months, so if we're going to allocate anything, let's allocate $150 (billion), $200 billion and come back and have further oversight to try to protect the taxpayer.

MS. BURNETT: Congressman Doggett, briefly before we go. It sounds like what you're saying is you'd be willing to take several weeks to get this approved. That is new. It's not what a lot of people are saying on Capitol Hill and no doubt you realize the significance of that potentially for the market.

REP. DOGGETT: I think the notion that a three-page bill can be provided over the weekend and expect Congress to pay it by Wednesday without thorough deliberation would be really irresponsible. It might do more long-term harm to our economy than help. I'm not suggesting that this go on for weeks, but I think we need a thorough deliberation and addressing it next week is better than rushing it this week.

MS. BURNETT: All right. Well, thank you so much, Congressman Doggett. We appreciate it again. He is on the Joint Economic Committee.

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