This is a rush transcript from "Your World With Neil Cavuto," September 22, 2008. This copy may not be in its final form and may be updated.
NEIL CAVUTO, HOST: Senator Harry Reid is on the wires right now saying this $700 billion figure for the rescue package, that's just a starting point, which is not music to this fellow's ears.
Republican Congressman Mike Pence, he and a lot of his conservative buddies have been powwowing today, talking about whether there's even the need for this in the first place.
So, Congressman, what do you make of that — $700 billion just for starters?
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REP. MIKE PENCE, R-IND.: Well, Anthony Weiner, my colleague, was on your air just a few minutes ago. I think he referred to the bill as a — what do they say in New York, a first tranche?
Look, I support the decision by the president last week to step forward and announce decisive measures. The financial markets are in turmoil.
But — but, Neil, you know, nationalizing every bad mortgage in America is simply not the solution. And many of us are saying...
CAVUTO: Well, are you — Congressman, are you for or against this rescue, bailout, whatever you call it?
PENCE: Well, I — I am for Washington, D.C., responding to the — the turmoil in the financial markets. But we ought to do a couple things, Neil.
Number one, we ought to put the interest of taxpayers first, by not running up the national debt and not guaranteeing an enormous tax increase.
Second, we ought to pursue policies that reaffirm our belief in the free market. We ought to ensure that that principle that the freedom to succeed also includes the freedom to fail. And there are ways to...
CAVUTO: Well, those days are gone, Congressman. You're one of a shrinking breed here who feels that way.
PENCE: Well, no.
CAVUTO: But, I tell you...
PENCE: Well, yes.
CAVUTO: ... when they start talking about $700 billion as a starting figure...
PENCE: That's right.
CAVUTO: ... we have got to provide protections to those behind on their mortgages — someone else was saying today — I wish I could remember his name — maybe there's something we can do for folks who are in credit- card arrears. I mean, man, it's out of control.
PENCE: Look, look, but, Neil — you know, Neil, it's — look, the American people know that the strength of this nation is built on our faith in God and our faith in — in freedom, particularly economic freedom.
And they want this Congress to take a breath — that was something Anthony said that I really agree with — take a breath — examine what has happened here, and then develop policies — maybe there is a need for some short-term government intervention, not of the magnitude that's been discussed.
A transfer of over a trillion dollars — when you add it all up from the previous bailouts — a transfer of over a trillion dollars from Main Street to Wall Street to bail out bad business decisions is not the way to go.
CAVUTO: Well, you know what? And, by the way, it's not the way to calm Wall Street down, Congressman, as you know.
CAVUTO: When this news came early today that Barney Frank had an understanding — I'm probably poorly paraphrasing it — with the White House to provide some sort of a mortgage relief inclusive of the package, the market, which already had been down, just fell another 75 points.
CAVUTO: So, I think the markets read into this — not that they're great soothsayers, Congressman, as you know — but the markets read into this, game lost.
What do you say?
PENCE: Well, Neil, I — look, I think you just examine what's going on with the price of oil, and you have also talked about what is going on with the American dollar today.
The world markets are looking at this and saying, "Good heavens, the United States of America is about to add a trillion dollars to its $9.6 trillion national debt." And that suggests inflation. That drives up the cost of oil. It drives down the value of our currency.
Look, if we have a liquidity problem in this — in this marketplace — and, to some extent, we do, there's no question — let's pursue policies that will — will release the — the entrepreneurial capital that's tied up in this country because of higher taxes.
CAVUTO: All right.
PENCE: Let's take inflation out of the calculation of capital gains taxes...
PENCE: ... which the president can do by executive order...
CAVUTO: Well, it's...
PENCE: ... and you will have an enormous amount of capital in this market.
CAVUTO: We will see. It's not happening right now, Congressman Pence. But thank you very much.