This is a rush transcript from "Your World With Neil Cavuto," November 20, 2008. This copy may not be in its final form and may be updated.
NEIL CAVUTO, HOST: You know things are bad when, now, even the French say we are fried and our view of capitalism is full of crepe — the president of France now calling for his own economic summit in early January. Nicolas Sarkozy reportedly wants to tame the animal spirits of American capitalism.
What did you think? Was that — it was bad. All right. I'm sorry.
But he is determined to use this global crisis to do it.
Craig Smith says we asked for this. Craig is the CEO of Swiss America.
Well, Craig, I think you are right. I guess you are right. We provided the bad example. And away we go, right?
CRAIG SMITH, CEO, SWISS AMERICA TRADING CORPORATION: You bet, Neil.
• Video: Watch Neil's interview with CEO Craig Smith
And, by the way, I did not fly here on a private plane today, Neil.
SMITH: I drove by car.
SMITH: So, I want to make that clear right up front.
You're absolutely right, Neil. We deserve this. We deserve to be rebuked or rejected by the French. We have abandoned every free market principle that made this nation great. We have got Nancy Pelosi taking bankruptcy off the table, more government intervention. She wants to fix it, vs. the free markets.
And you have France, that has been literally running away from controlled markets, and privatizing businesses over there, and they wanted us to set an example. And we have set a lousy example, Neil. And, quite frankly, I do not think we are in a position to offer anybody leadership, when we have had such knee-jerk reactions and such inconsistent messages to the market that Mr. Paulson and Mr. Bernanke have sent. It has been ridiculous.
CAVUTO: But, you know, it's interesting, because you are quite right. Since Sarkozy took over, one of the first things he did was to sort of unshackle the markets and the economy and this — this entitlement sense that France has gone used to.
Unemployment has been ebbing down. It is still, you know, at close to 10 percent, higher than our own, for now.
CAVUTO: But he is going the way that would at least be a healthy capitalist development.
Having said that...
CAVUTO: Having said that, though, he is also in — in deep economic doo-doo.
So, what lessons can we learn? The jury is still out on who is going to come out ahead here. What do you make of it?
SMITH: Well, but why is he in the economic doo-doo, Neil?
They — 50 percent of their GDP goes to paying taxes. Eighteen-point- eight percent of ours goes to taxes. And I wrote about this in my piece at WorldNetDaily that will run tomorrow. The most dreaded words in the American language are: We are from the government, and we are here to help.
SMITH: And that is what we have done in the markets, and the markets have panicked and have run for cover.
CAVUTO: But they're panicking world over, Craig, right? I mean, there does seem to be this global trend, not in each and every country, but, where, well, I guess the government has got to do something. We have been — you know, what do you make of that?
SMITH: But, Neil, what do you expect, when the superpower, economic superpower of the world, America, is panicking?
I mean, we have the words like meltdown, collapse being used by our treasury secretary and our president, for Pete's sakes.
CAVUTO: Well, what would you have done, Craig?
CAVUTO: I mean, there is the argument, let them rip. In other words, the financial industry is in disarray. Don't rescue a one of them. Auto industry is in disarray. Don't rescue a one of them.
In other words, let markets be markets, brutal though they may be. Let them clean and flush themselves out.
SMITH: I agree to that to a certain extent, Neil.
But there are things, productive, that the government can do to make things better, like Mr. Rove just suggested. Why not cutting business taxes? Why not incentivizing? Why not change this ridiculous mark-to- market rule that assumes that anything that is on your book that is not functioning is worth zero? That is ridiculous.
Many of these loans, if they are held to maturity, Neil, are going to be just fine. Most people in my neighborhood are paying their mortgages. But we focus on the few that are not.