Trump: Nation Has Become 'All Talk, No Action' and Obama Has 'No Clue' on the Economy

This is a rush transcript from "On the Record," August 8, 2011. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Donald Trump says we have ourselves one hell of a problem, the Dow in freefall, down more than 634 points and NASDAQ plunging down 175, and the S&P 500 off 80. So how nervous should we all be?

Earlier today, we asked Donald Trump.


VAN SUSTEREN: Donald, the whole world seems to have jitters, especially here in the United States, the Dow going down 634 points just today. Your thoughts on that?

DONALD TRUMP, TRUMP ORGANIZATION (Via Telephone): Well, they should have jitters and they should have jitters about this country and the way this country is run. So I don't blame them at all. And frankly, if you're a great citizen of this great country -- and I say great now, but it has to be somewhat tenuous, Greta, because what's happening is going to make it not so great -- you have to be very, very nervous.

VAN SUSTEREN: You know, the thing that seems to have been the catalyst for the horrible day today with the Dow and the stock market in general is the S&P downgrading the United States. Now, the president blames that on, quote, "the lack of political will, as well as the insistence on drawing lines in the sand," meaning the political divide. And David Axelrod, who is one of his strategists, over the weekend blames it on the Tea Party, says it's a "Tea Party downgrade."

The S&P, as bad as they are and as horrible as they are in terms of that credit swap, AAA that they gave the credit swaps in the mid-2000s, it has an impact. Is the president right? Is David Axelrod right?

TRUMP: Well, David Axelrod is not right because the Tea Party happens to be the group that really got people to start thinking about the problems. And the Tea Party wanted a much stronger solution than was ultimately approved. I mean, the solution that was approved was not very good.

Now, I know the S&P from lots of experience, including watching them miss so many calls over the last couple of years. These people are probably publicity-hungry. They probably love doing what they're doing. I see their representatives all over the press. They're being heroes. They're going home to their wives and boyfriends and everybody else. And you know, I think they're loving it. I just watch them. I see them being interviewed, and I think they're loving it.

They're losers. They shouldn't have done what they did. But they did it. And they had a reason to do it, if they wanted to do it. They shouldn't have done it, but they had a reason if they wanted to do it. And the reason is that we really do have a dysfunctional government right now. It's terrible. What's going on with the presidency, what's going on with other aspects of our government is absolutely insane. And very sad, as a citizen, very, very sad.

VAN SUSTEREN: You know, the White House seized on the fact that they -- fact that they made about a $2 trillion math mistake on Friday when they sent some information over to the Treasury Department. But I thought when I heard that, that's the least of the problems in terms of the mistake. What about the mistake when they gave those toxic credit swaps the AAA rating, which in a -- which sort of started the ball rolling into this cataclysmic economic event that we have today. It's extraordinary that we focus on Friday's mistake, yet we let them off the hook for their many mistakes.

TRUMP: Well, that's exactly right. And whether it's Standard & Poor's that you want to criticize because that's easier to criticize them because you just look at their calls on Lehman, look at their calls on housing and on mortgages and the mortgage-backed securities -- they're disgraceful.

But now they're making another call. And you know, they could have gone either way very easily. Look, we have a great country. If you look at what's happening, people want to invest in our securities, even though they're not paying very much interest at this point. But today you had the big beauty of all, you had the big drop in stocks. People are now seeing that there are really big problems out there, Greta.

And you have a president that's not leading. He's not setting the example. You have a president that really doesn't have a clue, and that's a big problem for this country. We have ourselves one hell of a problem!

VAN SUSTEREN: All right, not having a clue is -- I don't know if that's worse than having a different ideology, but that's an incredible indictment of the president.

TRUMP: Well, I think it's a combination of both. But I actually think it's more of the not having a clue. I really think he'd like to see things happen, but he doesn't know how to get there.

VAN SUSTEREN: Should he have a different secretary of the treasury? Because Representative Michele Bachmann, for instance, here "On the Record" the other night said that Secretary of Treasury Geithner should submit his resignation. If he doesn't, he should just fire him.

TRUMP: Well, certainly, it hasn't worked out very well. We're not respected. We're scoffed at. We're laughed at throughout the world. So obviously, Greta, it hasn't worked out very well under Geithner.

And you could really make the case that somebody new should go in and give it a shot. You get somebody who's really good and you get that person to give it a shot. But it has certainly not worked out very well for the country having Geithner.

VAN SUSTEREN: If you could have a private conversation with the president today, what you would tell him?

TRUMP: Well, I'd tell him lots of things. But one of the things I'd tell him to do is not -- he's got to stop allowing other countries to just absolutely destroy our country. If you look at what's going on with China, the way they're just virtually stealing from us -- they have our jobs. They're making our products. They're manipulating their currency so it's very, very hard to compete. If you look at what's going on with OPEC that even with everything happening, with bad economies, you have $100 oil. Now it's starting to come down.

But if you remember, I did your show when it was at $148 a barrel, and I said that's going to destroy our economy. You can't have oil and you can't have the blood of the country -- you can't pay that kind of number. So these 11 guys sit around a table and they set a price of oil, and the price has nothing to do with market or market conditions. You have ships all over the world -- they're loaded up with oil. They don't know what to do with it, and then we're paying these prices. So ultimately, the oil kills us. And our lack of leadership is just absolutely killing us.

VAN SUSTEREN: You say lack of leadership. You say the president doesn't have a clue. I'm curious what you think about the fact that the Congress is on recess, which was planned many -- you know, it's every year they have this recess. And many of them are working hard with constituents or on Codels, but nonetheless, they're not here in Washington. They are not sending the message to the American people that they have a sense of urgency. Should they be back here in Washington? Is there some message that they should be sending the American? Or are they doing the best they can under the circumstances?

TRUMP: Well, if there's anything positive about the Standard & Poor's report and downgrading, it's that the president should call people back, everybody back, and they should knock out a real deal. They shouldn't rely on a committee that's going to meet at Thanksgiving and come up with a solution by Thanksgiving.

They should come back to Washington. They should cut a deal where trillions are cut, real trillions, not what they did, which was just a mirage. They should cut a deal. They should come back. I don't even hear that being talked about. That would be the only thing positive that could come out of this very horrible news about the rating cut.

VAN SUSTEREN: You know, the president said today (INAUDIBLE) earlier about that what he thought was the reason behind it in part was that there's this great divide, no political will, a line drawn in the sand, which is interesting to hear. But I didn't hear from him what are we going to do about it and what are we going to do about it now. I thought that it was a nice speech to the American people, but I didn't see a clear path out of this.

TRUMP: I think the problem with the president, he makes too many speeches to the American people. You know the expression, All talk, no action. That's what this country's about right now. We're all talk, we're no action.

He's got to get these people back. Don't worry about the committee. They're going to form -- the committee won't even be formed for a long time. They have to get something going and going quickly, and this is really the time to do it.

And you can say what want about the Tea Party, the Tea Party was the group of people that made them -- they realized this before anybody else. It made them think. So I'm very proud of the Tea Party. I think they do an unbelievable job of getting people to realize what's going on. They're the first time, the first group that's been able to do that.

VAN SUSTEREN: You know what strikes me as sort of unusual is that everyone in the last couple days sort of in Washington woke up and discovered the Tea Party, when this is something -- you know, this is what they elected certain people on, you know, in November of last year. I'm surprised that so many politicians are surprised that the Tea Party expects that the word would be kept.

TRUMP: Well, look, the Tea Party said something very simple. They said, This country is going broke. We're going to have to cut our costs. We're going to have to cut our expenses. And we're going to have to do it fast.

Now, there's nothing wrong with that message. It's a very sound, solid message, and it happens to be true. So I don't know how people can criticize -- I mean, I hear some of the senators saying this is a Tea Party default. The Tea Party is the one that really brought people's minds to look at the problem and really could have gotten to the solution, but they didn't get ultimately what they wanted.

VAN SUSTEREN: I read over the weekend a quote about going into bankruptcy. And someone asked, you know, How do you go into bankruptcy? And the answer was, Gradually and suddenly -- suddenly when the banks stop lending. It's almost a little bit with -- like -- likewise with the Tea Party, is that they suddenly -- that the Tea Party was out there and a problem but didn't become a real problem until they really sort of laid down the law and said, We expect this.

TRUMP: Yes, the Tea Party really wasn't the problem. The Tea Party had -- the Tea Party really pointed out the problem, if you think about it. The Tea Party said, Look, we can't afford to be $21 trillion in the hole. You know, we're going to be up in a few years to $21 trillion. We're at $15 trillion right now, numbers that nobody even conceived of or heard of before. The Tea Party, Greta, pointed it out, and I think they should be given certain (ph) praise. Now, some people would say they're too staunch (ph). They don't negotiate. Well, you know, compromise is wonderful in some cases. But sometimes, you can't compromise.

VAN SUSTEREN: But isn't it sometimes a failure to compromise, though, is sort of biting off your nose and spite your face. I mean, in the sense that you -- you -- sometimes you need to compromise so that you can get things moving forward, rather than to simply, you know, abort everything.

TRUMP: Greta, we're spending hundreds of billions of dollars on rebuilding other countries, if you look at what we're doing. Look at Afghanistan. Why aren't we building our schools instead of their schools? Look at -- if you look at so many different countries, what's going on in Iraq, what's going on in -- just name it. You look at the deals we make with other countries. Every country makes a better deal than we do.

You look at Colombia, not a large -- not a very large country. They made $4 billion, call it profit, against the United States last year. And now they want a new pact so they can make more. Who do we have representing us? China this year will make $300 billion, and that was a projection from a year ago. And I just read a week ago that those numbers were very low. They're going to make much more this year than that because they're doing numbers on us that nobody would believe, and our politicians aren't smart enough to figure it out.

Unless we do something with all of the countries throughout the world that are ripping off the United States and taking billions and billions and ultimately trillions -- the new word -- of dollars, we can never be great again.

VAN SUSTEREN: The thing that I find particularly distressing about all this, Donald, is that all the solutions, whether you accept the Republicans solution or the Democratic solution, whatever, they take so long. And we are so deep into this mess that we really need answers and action now.

A lot of people really almost can't afford to wait. They can't wait for these -- they can't afford to wait for the November committee to meet and do cuts or they can't wait for some tax cuts or tax revenue or whatevers. People can't afford to wait because these solutions seem long term and people need help right now. They need the economy going today.

TRUMP: Well, you're right, and that's my problem with the committee. The problem we have in this county is you form committees. I see it all the time. They're forming committee after committee, and that committee will form a new committee. And in the meantime, China wants to build a development, they want to build a new city, and three days later, they start construction. Other countries, the same thing. We're forming committees.

We're really in trouble. We have the wrong people leading. We -- we -- and we're trying -- he's almost trying to lead by consensus, trying to lead by committee, and you can't do it. But you just mentioned it. Think of it, Thanksgiving. You know how long Thanksgiving -- here we're in August. How long is Thanksgiving? This is when the committee's going to come out with -- there's no reason to come out -- they could knock this thing off in two days, if they all got together.

They need the proper leader to get them in a room to have to knock heads and come up with a solution. They don't need this ridiculous committee that's going to be (INAUDIBLE) You know what the biggest thing on the committee now? Everybody's politicking to be on the committee. Everybody wants to be on the committee. That's the hardest decision the committee has right now because everybody wants to be on it. They ought to get together as a group, forget about the committee nonsense and Thanksgiving, and come up with a solution right now.

VAN SUSTEREN: Maybe they should come back to town now and start working.

TRUMP: They should! There's no question about it. What are they doing? They should come back right now. And that's what you would assume would have happened with S&P. As pathetic as S&P is, you would have assumed that because of what they just did, they'd all get together and work out a solution. Instead, I haven't even heard the suggestion of them coming back and knocking out a deal. It's very sad.

VAN SUSTEREN: Donald, thank you.

TRUMP: Thank you very much, Greta.