Treasury Secretary Geithner: Should He Stay or Should He Go?

This is a rush transcript from "On the Record ," March 23, 2009. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Treasury Secretary Tim Geithner has been under fire for weeks. Some people say President Obama should fire Secretary Geithner. Is there any chance that will happen? President Obama answered that specific question on "60 Minutes."


STEVE KROFT, "60 MINUTES": Have there been discussions in the White House about replacing him?


KROFT: Has he a volunteered to or come to you and said, Do you think I should step down?

OBAMA: No. And he shouldn't. And if he were to come to me, I'd say, Sorry, buddy. You've still got the job. But look, he's got a lot of stuff on his plate, and he is doing a terrific job. And I take responsibility for not, I think, having given him as much help as he needs.


VAN SUSTEREN: Joining us live is Republican senator Lindsey Graham. Senator Graham, the question was put to President Obama whether or not Secretary Geithner should go. He says no. Should he go or not stay?

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: Well, I -- it'd be up to the president. Right now, no one's going to go as long as someone doesn't have to pay a price. But if there ever got to be a point in time where this administration had to change policy and had to show the public that we're going to change course, Geithner would be the first guy to go. But I think he's OK. Particularly, what happened today has probably helped him.

VAN SUSTEREN: What -- I mean, at what point do we make that assessment? I mean, is that an assessment we make about whether or not maybe to, quote, "change direction," which is -- which is code for failure, I guess, but...

GRAHAM: That's easy in this town. That's easy in this town. People go when they become -- somebody has to go and keeping the same team in place is a political liability. This is a business, and don't let anyone tell you otherwise. When they tell you, I have absolute confidence, I wouldn't accept his resignation, what that means in the real world is, If I got to fire somebody, he's the first to go.

VAN SUSTEREN: All right, but at what point do we know whether or not this policy that the president has undertaken, this economic policy, which is quite -- quite a grand one -- I mean, there's -- it's an awful lot of money...

GRAHAM: Good question.

VAN SUSTEREN: June, July, August, December...

GRAHAM: I think weeks...


GRAHAM: ... instead of months. I asked Alan Greenspan that very question. When will we know if this new bank plan will work? And he said, This is a very sweetheart deal for investors. If I put a million dollars into the pot, the government will loan me $9 million. And if I lose the $9 million, they can't come and get it back. The only thing I'll lose is the money I put in the pot. You leverage it about 8 or 9 or 10 to 1.

We'll know in a few weeks if the private sector wants to take part of this. And why would they not? After the AIG debacle in the House, where the House was going to tax people at 90 percent, there are a lot of people sitting out there tonight saying, Do I want to do business with the federal government, given the way the federal government has behaved? We may have scared everybody off from wanting to do business with us. We'll know in a month or so.

VAN SUSTEREN: Well, if it's such a sweetheart deal that everyone talks about, it's -- I mean, if I have, you know, $10,000 to invest, am I eligible to get into this, or is this, like, just the big guys who can get in on this thing?

GRAHAM: Well, I think it's going to be the big guys because of the amount of money. I don't know what the rules are, but I know this...

VAN SUSTEREN: There's no way for me to get in on it?

GRAHAM: Well, I'll call, Greta, and I'll see.

VAN SUSTEREN: No, but I mean -- see, that's...

GRAHAM: Well, I'll ask.

VAN SUSTEREN: I mean, but that's sort of the interesting thing...

GRAHAM: Maybe everybody listening, we can pool our money and we'll be an investor.

VAN SUSTEREN: We can do our own hedge fund...

GRAHAM: Yes, Greta...

VAN SUSTEREN: ... the Gretawire hedge fund.

GRAHAM: Yes, the Greta people. I don't know. It'd be a hedge fund, probably.

VAN SUSTEREN: But I mean, it it's such a sweetheart deal, I mean, it seems to me, since the taxpayers have been -- you know, this has been on their back for so long, and they're going to -- and they're -- future generations are going to pay for it, it shouldn't just be the huge institutions that get this sweetheart deal. Somehow, I think the rest of us should be able to get in on it. Or you know, maybe not. I'm not saying (INAUDIBLE) but people who...

GRAHAM: It's going to take a lot of money. There's a trillion dollars at least of these bad loans. To get them out of the system, there are two ways to do it. The government can buy them and have all the risk of trying to get their money back, or you can share that risk. And the sharing here is about 10 percent by the private sector and 90 percent...

VAN SUSTEREN: That's a great deal!

GRAHAM: Well, that's a hell of a deal.

VAN SUSTEREN: I mean, (INAUDIBLE) but that's what I mean. That's my point, is that there must be some way that -- you know, that people out there who are -- who don't have jobs but may have a little savings (INAUDIBLE) they ought to be able to get in on it.

GRAHAM: I don't know what...

VAN SUSTEREN: If it's such a great deal.

GRAHAM: I don't know what the minimum bid is, but I'll get back with you. I'll be on your show and I'll tell you if it's a $5 table or a billion-dollar table.

VAN SUSTEREN: How much should we hang -- should we hang our hat on the fact that the market went up about 500 points today?

GRAHAM: Well, it's good news. But like, you know, Steve says, you know, markets fluctuate. Housing sales went up 5 percent. That doesn't mean housing values have come back. We've got excess inventory, when you got more demand -- more supply than you have demand. Our home values have gone down dramatically. Sales have gone up because people are...

VAN SUSTEREN: Great deals.

GRAHAM: Well, they have some credit available. I think the big reason, there are great deals, and now you can begin to borrow money. If you put a trillion dollars into the mortgage system, somebody's going to have some money to lend to you. But when you put a trillion dollars in which is borrowed, you're going to create inflation down the road. So what we're doing today to jump-start housing may bite us in the butt down the road.

VAN SUSTEREN: Which is, of course, is terrifying. Well, all right, well, we'll be watching whether it's weeks -- I don't know what it is, but you know...

GRAHAM: I think weeks.

VAN SUSTEREN: Weeks. Anyway, Senator, thank you, sir.

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