Is Big Government About to Get Bigger?

This is a rush transcript from "Hannity," March 31, 2009. This copy may not be in its final form and may be updated.

SEAN HANNITY, HOST: In "Your America" tonight, the end of capitalism appears to be upon us, thanks to a relentless assault from the White House and congressional Democrats. Now the latest hit came courtesy of Barney Frank, who has quietly set in motion legislation that asserts government control over all salaries at companies that receive federal bailout funds.

Here with reaction tonight is Rebecca Diamond and Sandra Smith, both of the FOX Business Network.

All right, Rebecca, tell me that you don't want this. Tell me that you don't have a concern that Tim Geithner's proposing the takeover of companies, or the ability to take over companies that haven't received bailout money.

• Video: Watch Sean's interview

Tell me you don't want the government offering car warranties as they now are. Tell me that you have some disagreement with.

REBECCA DIAMOND, "HAPPY HOUR" CO-HOST: OK, so your first issue in your setup there, so you want us to give our hard-earned taxpayer dollars to companies with no strings attached?

HANNITY: No.

DIAMOND: That they can pay them anything they want?

HANNITY: No. I want the government...

DIAMOND: So you want AIG to happen. That's fine if they can pay them those bonuses.

HANNITY: No. No. I want no...

DIAMOND: Even though that.

HANNITY: You want my answer? I want no TARP. I want no stimulus. I want no omnibus increased spending. I don't want a $4 trillion budget and stealing from our children and grandchildren. I think...

DIAMOND: Well, I think that — but that's not the issue we're talking about here. They're doing this. You know, these companies have our bailout money.

HANNITY: OK. And I'm saying to stop.

DIAMOND: So you're going to put no strings on it? But what they do have, the companies have billions. Citigroup has $45 billion of our money. You want no strings attached?

HANNITY: Wait a minute.

DIAMOND: You want to give them carte blanche?

HANNITY: All right, I'll answer your question.

DIAMOND: They can do whatever they want with our money?

HANNITY: Let me answer your question with a question. Do you want your government — Tim Geithner wants the power, Barack Obama wants the power now, to be able to seize companies, whether or not they've received federal bailouts.

Do you want to live in that America?

DIAMOND: To be able to seize companies whether or not.

HANNITY: Seize companies whether or not.

DIAMOND: The FDIC already does that.

HANNITY: I'm talking about — they're not talking about FDIC.

DIAMOND: They already do that with banks.

HANNITY: They want the right to expand it to any company that they deem would impact the company. True or false?

SANDRA SMITH, FOX BUSINESS NETWORK: And that is absolutely true right now. Barney Frank wants to put this in motion. And I'll tell you what, it's already happening. Iberia Bank. It's a small bank based out of Louisiana came out today. They received $90 million in these bailout funds. They're giving it all back, as well as a few of the other small banks out there.

DIAMOND: Good.

SMITH: Why? Rebecca, how do you retain our top talent in this country? How do we attract.

DIAMOND: Attract talent?

(CROSSTALK)

DIAMOND: They got us into this mess, Sandra.

SMITH: But that's a generalization.

DIAMOND: The top talent out there is getting bonuses, and they shouldn't be there. They shouldn't be getting bonuses.

HANNITY: Listen. Wait a minute.

DIAMOND: Let's bring in new people.

HANNITY: It's not.

DIAMOND: Sean, you and I talked about.

HANNITY: Hang on a second.

DIAMOND: ... getting rid of Timothy Geithner.

HANNITY: He should go.

DIAMOND: ... because he was at the New York Federal Reserve that got us into this problem.

HANNITY: But wait a minute. But if you.

DIAMOND: That's our top talent, Sandra.

HANNITY: But if you look.

DIAMOND: The treasury secretary.

HANNITY: If the government is going to dictate prices, if they're going to have the ability to control firms, if they retroactively can isolate and target individuals.

DIAMOND: Then don't take the bailout money.

HANNITY: Hang on a second. No, no.

DIAMOND: Sean, let me ask you this. You didn't answer my question.

HANNITY: But Rebecca, I said I don't want the bailouts.

DIAMOND: I know. But the companies that do have bailout money right now, you want to let them do whatever they want with our money?

HANNITY: No. No, what I'm.

DIAMOND: No, so then, there you go.

HANNITY: Well, first of all.

DIAMOND: There's the legislation.

HANNITY: Here's the problem. It was Barack Obama and their administration that asked Chris Dodd to change the executive-paid bonus structure.

DIAMOND: So, yes. So?

HANNITY: No, no. I've got to finish this.

DIAMOND: OK, go ahead.

HANNITY: They wanted this — they wanted that in place. What I am concerned about is the reckless, irresponsible, unprecedented spending that we can't sustain.

DIAMOND: Of the banks?

HANNITY: What we can't sustain. Government spending. I'm concerned about a $4 trillion budget, an omnibus bill.

DIAMOND: We're all concerned about that, Sean.

HANNITY: So the bottom line is, I don't want the power of the government to be able to take over private companies. That's what they're asking for.

(CROSSTALK)

DIAMOND: We're all concerned about that if they're going to take our money, you better believe it that we're going to watch how they're spending it. And there better be strings attached.

HANNITY: We're debating two different things.

DIAMOND: No. You're...

HANNITY: We're debating two different things.

DIAMOND: They already have the money, Sean.

HANNITY: That's one issue. But Tim Geithner and.

DIAMOND: So should there be no strings attached to the money they already have?

HANNITY: The president wants the right to seize companies . The definition of socialism refers directly to the government taking over the means of production and the distribution of goods. That's what I'm concerned about.

SMITH: We attract a level of talent in this government, in this country. It's a business, Rebecca. If all of a sudden we have the government stepping in and regulating how we pay and the structure of payments to our biggest companies, we're attracting the greatest.

(CROSSTALK)

SMITH: The best and the brightest from around the world.

DIAMOND: If they're taking bailout money.

SMITH: Would you rather.

(CROSSTALK)

DIAMOND: ... then don't take the bailout money.

SMITH: You're thinking very short-term. You have to think long-term. You have to think global.

DIAMOND: Yes, because they have the money right now.

SMITH: But a lot of the top talents they have will leave this country.

DIAMOND: You guys, if you don't put strings attached to these companies.

HANNITY: All right. We got to go one at a time. I want the audience to hear.

DIAMOND: If we don't put strings attached, we're going to have another AIG fiasco that we just had.

HANNITY: All right. Rebecca, but the problem is.

DIAMOND: It's this simple. It's very simple.

HANNITY: The problem is, is that Barack Obama put in the provisions so AIG execs could get the bonuses. That's fact number one. Here's the problem. If we're going to look.

DIAMOND: Yes, but we don't want that to happen again.

HANNITY: If we're going to look at the most inefficient, bloated, massive enterprise that doesn't work, it's government. So the question is if government is going to take over all these companies and they're going to have all the strings attached, then they're going to guarantee auto warranties, I'm saying America is no longer a capitalist society. The capitalist society that has created a standard of living and the advancement of the human condition that is the envy of the world.

SMITH: And then the capitalist society is no longer here in the United States. It's going to move other places.

DIAMOND: Oh come on, you guys.

SMITH: It's going to move to other places.

HANNITY: Exactly.

SMITH: And we will no longer have the talent here.

(CROSSTALK)

DIAMOND: We have the best country in the world, OK?

SMITH: We have the best country in the world.

HANNITY: One at a time, one at a time.

DIAMOND: We have the best country in the world, OK? We have a capitalist system. No one is denying that our system is the best way to go. The markets are broken. They're trying to fix it. It may not be the best way to step in.

HANNITY: All right, I got to make a last point.

DIAMOND: But at least we're trying to do something.

HANNITY: We're running out of time.

DIAMOND: The fear of capitalism.

HANNITY: Rebecca, wait a minute.

DIAMOND: ... being gone, come on, you guys, give me a break.

HANNITY: Rebecca, Rebecca. Rebecca. Ten.

SMITH: It's a short-term solution.

HANNITY: $10 trillion in debt by 2019 with Obama's spending. We're going to be servicing that debt at $806 billion a year. I argue that's unsustainable. Am I wrong?

SMITH: Right now the Obama administration has to stop just short-term reacting to all of the outrage out there and putting things in place that will solve short-term problems, because we have to really start thinking big picture right now.

DIAMOND: And banks stop taking.

HANNITY: Five seconds.

DIAMOND: . our bailout money. Banks, stop taking the money. Fix it yourself.

HANNITY: Governments, stop offering it.

DIAMOND: Don't rely — don't rely on us. Don't rely on my taxpayer dollars.

HANNITY: I'm with you. I'm with you.

SMITH: They put it in their hands.

DIAMOND: Don't take it from me.

HANNITY: There we go.

DIAMOND: I don't like seeing every week my paycheck getting smaller and smaller.

HANNITY: Just one other thing. The big government should get out of the business of designing cars with CAFE standards, economy standards, bad trade policy and everything else, every other burden they put on with their regulation.

DIAMOND: Companies need to go back to capitalism 101.

HANNITY: All right.

Good to see you, Rebecca.

Watch "Hannity" weeknights at 9 p.m. ET!

Content and Programming Copyright 2009 FOX News Network, LLC. ALL RIGHTS RESERVED. Transcription Copyright 2009 CQ Transcriptions, LLC, which takes sole responsibility for the accuracy of the transcription. ALL RIGHTS RESERVED. No license is granted to the user of this material except for the user's personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon FOX News Network, LLC'S and CQ Transcriptions, LLC's copyrights or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.