Will Pelosi's Effort to Save the Harvest Mouse Ruin Chances of a Second Stimulus Package?

This is a rush transcript from "Your World With Neil Cavuto," July 9, 2009. This copy may not be in its final form and may be updated.


REP. JOHN BOEHNER (R-OH), HOUSE MINORITY LEADER: And, you will remember, the Democrats claimed, no, no, no, no, no, we're not going to — we're not going to fund this. It's not in the bill. It's not going to happen.

Well, guess what? Sixteen million dollars of the stimulus money was appropriated to take care of the salt marsh harvest mouse.




Welcome, everyone. I'm Stuart Varney, in for Neil Cavuto. This is "Your World."

Video: Watch the 'Your World' interview

The salt marsh harvest mouse. GOP leaders say funding for Speaker Pelosi's pet project is coming out of your stimulus money. Will this furry critter, along with bad press over the lack of stimulus jobs, kill any chances for a stim plan two?

Let's talk former House Speaker Newt Gingrich.

Mr. Speaker, welcome to the program.


VARNEY: This is — this is terrible publicity. The stim plan one is widely suggested it's not working. Voters are turning sour on it. Are we still get, do you think, stim plan two?

GINGRICH: Well, I think we need a national debate over getting to a real stimulus bill.

This was not a stimulus bill. This was a politician bailout bill. Most of the money — 90 percent of the money spent so far, according to Andy McCarthy, went to paying off state and local governments, so that they could avoid real change.

This is clearly a pork barrel bill, as you just reported, $16 million to San Francisco for a mouse, I think probably indefensible in the current economic environment.

We need a real stimulus bill. And here's the challenge. A real stimulus bill would have a 50 percent reduction in the Social Security and Medicare tax, including the employers' match, so that every small business in America could hire more people and could grow faster.

A real stimulus free market bill would have a zero capital gains rate, like China, would have a 12.5 corporate tax rate, like Ireland, would eliminate the death tax, which 80 percent of the American people want.

That would be a real stimulus bill.

VARNEY: Yes. Yes.

GINGRICH: So, I think — I think, frankly, Republicans ought to take up willingly the idea of, let's pass a real stimulus bill, cut — take all the money that has not been spent so far, which is about $500 billion of that stimulus package, convert that tax cuts for the private sector...


GINGRICH: ... to help small businesses.


GINGRICH: And you would be in a better future.

VARNEY: Mr. Speaker, you're using the magic words, tax cuts.

Do you really think the Democrats and the Obama administration and could completely change course? Because stim plan was all about more government spending and borrowing, the exact opposite of Ronald Reagan's tax cuts to stimulate private enterprise. Do you think that they could really turn full circle in the way you are describing?

GINGRICH: I think, first of all, when 64 percent of Californians vote no on more spending and more taxing, as they did in May, that is a pretty big signal.

That is a state where President Obama got 61 percent of the vote. I think, second, when you see a 13 percentage point drop in his approval rating in Ohio this week, that is a signal. There is a brand-new poll the Republican Governors Association did. And, in New Jersey, by 67-29, the citizens of New Jersey want government to make tough spending decisions to keep taxes down by cutting spending...


GINGRICH: ... rather than spend more money on the stimulus.

No, I'm just suggesting to you, as the Democrats face 9 percent, 10 percent, 11 percent unemployment, they are going to have to change their tune, or the country next year is going to change them.

VARNEY: You know, in Ohio, President Obama's approval ratings have dropped 14 points, I believe, in the space of two months.

Let me just take you to Vice President Biden, who was in Ohio today, talking about the stimulus plan and saving jobs. Listen in.


JOSEPH BIDEN, VICE PRESIDENT OF THE UNITED STATES: So, when they say we're not saving jobs, count the cop who still has their job. Count the teacher, thousands in this state, who will be showing up in the classroom in September, and would not be able to but for this.



VARNEY: So, Mr. Speaker, he says, look, stimulus one is saving jobs.

And now, if I may, I want you to listen to a little clip from investor Warren Buffett, who wants the stim plan two along the lines of stim plan one. Listen to this.


WARREN BUFFETT, CHAIRMAN & CEO, BERKSHIRE HATHAWAY: Our first stimulus bill, it seemed to me, it was sort of taking a half-a-tablet of Viagra, you know, or something, and then having also a bunch of candy mixed in, you know, as everybody was putting in things for their own constituencies.

And it doesn't have really quite the wallop that it might have been anticipated to have.



VARNEY: Well, he has a unique way of putting it, but he is pressing for stim plan two. You think it's going to happen, at the end of the day?

GINGRICH: Well, I don't — I don't — I have not read all of Buffett's comments, but I can't imagine why he would want more government spending.

And I can't imagine why he would believe that this Congress would be capable of passing more government spending, without having it loaded with pork, and special deals, and set-asides, and earmarks, and all the characteristics of this Congress.

So, I mean, the question is, do you think we can better accelerate economic growth by getting money to small businesses, as I do, or do you think we can be better accelerate economic growth by getting money to government, as Vice President Biden just said?

Remember, every job that Vice President Biden described was a government job.


GINGRICH: You didn't hear him say a word about small businesses in Ohio, or about saving the factories in Ohio, or about helping in any way in the private sector in Ohio.

VARNEY: Well, do you see a Republican anywhere in Congress who is pounding the table with the message that you have just delivered, who is really speaking with passion to the issue of cutting taxes and getting private enterprise going? Where is that leader in Congress?

GINGRICH: Oh, I would — look, I think both in the House and the Sunday, you're going to see a Republican initiative — I hope you're going to see a bipartisan initiative — to have tax cuts as stimulus — as a real stimulus.

This is not stimulus two, because stimulus one existed. That was a politician protection act designed to help mayors, county commissioners, and governors avoid having to make hard decisions. It actually — and if you look at New York State, for example, it is the worst of all worlds.

They have increased spending in Albany, making next year's budget crisis in Albany dramatically bigger.


GINGRICH: You can see the problem that Governor Schwarzenegger is having in California, where he has taken the right position, to control spending, and it's the Democrats in the state legislature who are desperately trying to prop up their public employee allies.

VARNEY: One last quick question, if I may. Do you think we will get the public option included in a health care bill which emerges from Congress?

GINGRICH: At the Center for Health Transformation, we're launching a petition drive to demand that, if there's a public option, every member of the House and Senate must belong to it. That can be their only health plan.

We think, if they want to impose on the country that kind of disastrous plan, they ought to take the medicine first.

VARNEY: Got it.

Mr. Speaker, thank you very much, indeed, sir.

GINGRICH: Thank you.

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