This is a rush transcript from "Your World With Neil Cavuto," November 12, 2008. This copy may not be in its final form and may be updated.
NEIL CAVUTO, HOST: Congressional Democrats today pushing for a $25 billion bailout of the auto industry. The legislation being drafted right now would give the government a stake, then, in the Big Three.
House Majority Leader Steny Hoyer says that we need this. He joins me right now.
Mr. Majority Leader, always good to have you. Thank you for coming.
REP. STENY HOYER (D-MD), MAJORITY LEADER: Hi, Neil.
CAVUTO: Is it — is this — go ahead.
HOYER: Neil, I was listening to — I was listening to Mr. Goldwater, a former member of Congress, of course. And it is interesting he didn't say why the government has to step in.
It has to step in because the private sector badly mismanaged itself, at great risk to the country. That is why President Bush moved, and the Congress supported him.
But go ahead.
CAVUTO: Well, I could see the logic there.
But what concerned me then — and concerns a lot of folks now, as you probably know, Congressman — is that it's out of control, and — and that the government is trying to fix the problem without, A, consistently finding a way to deal with the problem, suddenly changing the rules at play, the costs for changing those rules, and even who you are helping out.
HOYER: Neil, none of us, I think, are happy with where we are or what we think we have to do.
I do not think anybody was happy with the TARP program, the — the assets program.
HOYER: I don't think any of us are happy with the auto situation that confronts us.
But, in the autos, for instance, which you asked me about at the outset, we're confronted with, quite possibly, the inconceivable, and that is that the auto companies would — would fail. That...
CAVUTO: Well, why not let them, Congressman?
HOYER: Well, that's what — let me tell me, I...
CAVUTO: I mean, if they — if they file for Chapter 11, or whatever the chapter du jour is, right...
CAVUTO: ... and — and they work their — their way through the bankruptcy court system, what would be so bad about that?
HOYER: Well, that is a possibility, but, if they went bankrupt, and they could not reorganize, and people did not want to buy the cars of a bankrupt company, because they were not sure that company was going to be around, and, in effect, they, then, therefore, went out of business, that is 3 million jobs in America that we're looking at, dealerships, suppliers, not just the workers at the factories.
And, in addition to that, Neil, we have to be concerned about our industrial capability. That is a national security issue. If, heaven forbid that we get in a very hot war, and we need to produce tanks, trucks, et cetera, et cetera, we're going to need that capacity. So, I think — I...
CAVUTO: But where do you draw the line?
You know, I think, Steny, what — what happens here — and, again, you know, the best of intentions here...
CAVUTO: ... is that, then the housing guys — I have had all the housing CEOs on, Congressman, and they have been telling me, "Well, we need a rescue." I have had textile manufacturers on — "We need a rescue." Credit-card companies come forward, "We need a rescue."
HOYER: We have...
CAVUTO: And I was joking the other day that I couldn't pay my dinner bill the other day. I wanted it — to send it to you, just for the heck of it, to see if you would pay it.
HOYER: Don't send it to me.
CAVUTO: But you know my point, that it's gotten out of control?
HOYER: Sure. Neil, we understand that.
Clearly, President Bush, Secretary Paulson, and Ben Bernanke, as you know, came to us about a month ago — a little over a month ago, maybe now six weeks ago — and said: "Look, we've got a crisis. We've got — we're confronting the deepest economic crisis since the Great Depression."
We know what happened in the Great Depression, the reason it — it went to a depression was because the government failed to act. The government failed to step in and to stabilize the economy.
We know that. Ben Bernanke — the history of the Great Depression, as you well know — has said, "Look, if you don't act, we are going to have a — a real crisis."
CAVUTO: What if you — what if you overact? What if you overreact? And that is the rap that many have now, that — that you're overreacting.
HOYER: Well, I don't know that we're overreacting in the face of the possibility of our automobile industry failing.
It is clearly the largest industry in our country. I guess the financial industry is now.
HOYER: Or was, at least.
And — but the automobile industry is certainly the largest manufacturing enterprise we have in the country, not only direct employees, but I said — but, as I said, all the other employees that are involved.
CAVUTO: Then, could I ask you this, Congressman?
HOYER: And the industrial capacity is critical to us.
HOYER: So, that's not like some of the other entities that you have described.
CAVUTO: All right. All right. Let me ask...
HOYER: But, clearly...
CAVUTO: Yes, I know what you're trying to do.
HOYER: ... clearly, you're correct. We may well — every one of us is very concerned about taking these actions.
CAVUTO: OK. All right. I didn't mean to talk over you there.
On the issue of president-elect Obama's own plan — when he comes into office — would you advise him — when it came to raising taxes, in this environment, would you, Steny Hoyer, the House majority leader, tell him to go slowly, or to postpone?
HOYER: I think president-elect Obama's own inclination is to go slowly.
Clearly, we do not want to do anything that will depress the economy. And, in fact, I think you're going to be looking at tax cuts, particularly, on individuals and small business, in the first months of the Obama administration.
CAVUTO: So, the middle-class tax cut is still on...
CAVUTO: ... and — and the tax hikes, if I'm reading you correctly, would — would be allowed to expire at the end of 2010, but not expire sooner?
HOYER: I think that's a definite possibility.
Again, you have — you have heard me say before, Neil, that you don't want to try to have a stimulus and a depressant at the same time. That makes no sense. That's counterintuitive and counterproductive.
So, I think your observation that going slow on any tax increases will be, I think, what the Obama administration will do, and what we will do.
CAVUTO: All right. Steny Hoyer, always very good having you. Thank you for joining us.
HOYER: Thank you, Neil.
CAVUTO: Steny Hoyer, the House majority leader.
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