CNBC "The Kudlow Report" - Transcript

Interview

CNBC "The Kudlow Report" - Transcript

CNBC "The Kudlow Report" Interview With Senator John Thune

Interviewer: Larry Kudlow

Subject: Majority of Administration's Czars Made High-Value Political Contributions; Date-Certain Withdrawal From Government Ownership of Bailed-Out Companies

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MR. KUDLOW: Senator John Thune was a date-certain government exit from GM and all the other companies you, the taxpayers, own. I say, let's rollback socialism. Joining us now is South Dakota Republican Senator Thune.

It's a pleasure to see you, Senator. Thank you for coming on. Before I get to your wonderful date-certain strategy here, did you know, of all these 21 czars -- this is a story that's breaking, I don't think anybody has put it up before we have -- what is it, 13 or 14 of them paid $240,000 in campaign contributions? They're not confirmed, Senator Thune, so you didn't really have a chance to comb through this, did you?

SEN. THUNE: No, we did not.

MR. KUDLOW: I mean, does this offend you?

SEN. THUNE: It kind of does, Larry. It's government-by-czar, and it seems like they've sort of had a czar auction to put people in these positions.

MR. KUDLOW: Yeah. You purchase your czar seat. You know, the Romanoffs at least said it was divine intervention. These guys, it's dollar intervention.

SEN. THUNE: It really is.

MR. KUDLOW: All right. I want to get to your great story. You are putting, what, July 2010, all right, that's a year from this July, we want to get out of the ownership business -- AIG, General Motors, all the rest of them. Tell us about it, sir.

SEN. THUNE: What we did, Larry, is we concluded that there is no plan for getting the government out of the private ownership of private businesses. And we think there needs to be an exit strategy. And so what this does is it prescribes a date, it does give the Treasury Department some flexibility if they need to extend that for six months or even up to a year if they think that some of these assets may appreciate. But we don't think that there ought to be an open-ended commitment that obligates the taxpayers, the federal government to have a controlling interest in a lot of these companies indefinitely.

MR. KUDLOW: As in forever, as in Amtrak.

SEN. THUNE: It won't go away. And you look at already the complications that are created when government gets involved and substitutes political decision-making for business decision-making and the day-to-day management of some of these companies. We're already seeing some of the inherent conflicts of interest that occur with that.

MR. KUDLOW: Senator, let me ask you, if some of these firms might not be ready. You've got banks on this list, like Citibank, they're government owned now, 34 percent. Of course, you have General Motors, AIG, you got Fannie and Freddie. Talk about basket cases, Senator. Fannie and Freddie is pathetic. But let me ask you, sir, given your date-certain withdrawal of taxpayer ownership via the government -- taxpayers don't even want it, the polls are horribly against it -- would you put these companies in bankruptcy? Just a normal bankruptcy procedure, let them sell off their assets and get somebody to take them over?

SEN. THUNE: I think that would be the best market-based solution. We have a process. It's called Chapter 11 where companies can go in, reorganize, hopefully emerge and become stronger companies. But the problem we've created is now we've got the government intervening with all these private companies. And we're now, the taxpayers, are making it very difficult for the market to do what it should naturally do.

MR. KUDLOW: Probably the most consistent polling data I've seen -- everything, Gallup, Rasmussen, you name it -- is the public does not want to own these companies. It's unbelievable.

SEN. THUNE: It really is. And I think the polling validates that. Anecdotally, I can tell you, just from traveling my state of South Dakota, more and more people are coming up to me, unsolicited, saying, this has got to stop. We think enough is enough, it's time for us to have an exit strategy. This does that.

MR. KUDLOW: I know you're cosponsoring with Senator John Cornyn of Texas. You got some other people? Did I read today, Ben Nelson of Nebraska is interested?

SEN. THUNE: He's interested. We've talked to a number of Democrats. We hope we can get some onboard.

MR. KUDLOW: All right, great stuff. I wish you all the luck in the world. I think it's a great idea. Date certain, get out of the government ownership business. Senator John Thune.

SEN. THUNE: Thanks, Larry.

END.

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