Rep. Frank Pallone Pushes for Bailout Cash Release

This is a rush transcript from "Your World With Neil Cavuto," January 12, 2009. This copy may not be in its final form and may be updated.

NEIL CAVUTO, HOST: As the president tries to soften the blow by, pending Congress' approval, releasing the remaining 350 billion bucks of that bailout dough, the next president hints of big plans for that bailout dough.

To New Jersey Democratic Congressman Frank Pallone, who says, quit debating the dough; just release the dough.

Congressman, good to have you.

• Video: Watch Neil Cavuto's interview

REP. FRANK PALLONE, D-N.J.: You, too, Neil. Good to see you.

CAVUTO: If this dough is not released in the order and the timeliness in which you expect, what happens, do you think?

PALLONE: Well, basically, Congress has about 15 days to disapprove the spending of the money. If it does not, then the president has the ability to proceed with it.

But, right now, what we are trying to do is to have some controls. This week in Congress, we are trying to pass the bill introduced by Barney Frank that basically would put some controls on the expenditure of the money, more transparency, more reporting, more help for those who face foreclosure.

I think the feeling in Congress is that we need more controls because there were not enough with the first $350 billion.

CAVUTO: Well, I thought you guys were part of the control. I mean, you dispensed half of that dough, right, $350 billion. But, without any controls, who is to say releasing another $350 billion is going to have any better result?

PALLONE: Well, I think there was — there was an effort to try to control it under Bush, but the legislation did not have a lot of — enough restrictions. And so the idea is to try to tighten it up.

CAVUTO: So, why did you vote — why did you vote for it?

PALLONE: Well, I think, at the time, people felt — and I still agree — that something needed to be done.

And if the president was not willing to go along with some of the controls we wanted, you know, we were going to let him do it, because we feared that, if not, things would get worse. But now I think there is an opportunity with the second installment to make it tighter, you know, like have quarterly reports...

CAVUTO: Right.

PALLONE: ... insist that the foreclosures be looked at and be helped more significantly, in a sense, having learned a lesson, if you will, to make this more regulated.

CAVUTO: But do not worry, Congressman — and, by the way, this is not an aspersion against you, Democrats, Republicans. A pox on everybody.

You know, you just throw money at someone. There isn't a way to police where it's going. And, yet, you are for allocating more money to throw at still other problems, for which there is still no accountability.

And you — you just seemed to hint that you would be all for releasing that dough, pending or not these other restrictions.

PALLONE: Well, Neil, I think that many of us, we're — in many cases here, we're kind of guessing what needs to be done.

I mean, this is unprecedented. The level of the economic downturn is probably the worst since the Great Depression. So, I mean, you try to do your best to come up with some answers, as best you can, but nobody has the crystal ball, frankly.

CAVUTO: So, why spend for more crystal balls, right?

PALLONE: Well, every — most economists agree that, if we don't do more to — to, you know, loosen the credit market, to help those with foreclosures, to help community and smaller banks, that we will see more job losses, and credit will tighten.

CAVUTO: Yes, but you need guarantees, right, Congressman?


CAVUTO: You're pretty shrewd with it, but you need guarantees to see that it is going to just that end, right?

PALLONE: Well, Neil, I don't think there are any guarantees. You know, we're in a bad situation.

CAVUTO: So, why — why pay? Why pay for it?

PALLONE: Well, the feeling is that, if we do not do more along this line to help with a bailout, if you will, to help with those who are losing their homes, to help with banks that might go under, you know, smaller ones, that — that we will see a worse situation.

I mean, I still...

CAVUTO: I see.

PALLONE: I still feel strongly that the first bailout worked. It is just — it's just that more needs to be done.

CAVUTO: I got you.

All right, Congressman, very good having you on. We will see how this works out.

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