Sunday, September 28, 2008

Barack Obama on Face The Nation: Transcript (9-28-08)

Read the complete transcript.

OBAMA: Well, look, first of all, I think we have to understand that this was an urgent situation and is an urgent situation. And by the end of the week, I think everybody recognized that something needed to be done.

What I’m pleased about is that it appears at least-- and I haven’t reviewed the actual language-- is that some core principles that I’ve set forth at the beginning of this crisis were incorporated. The issue of making sure that we had strong oversight, the insistence that taxpayers share in the gains if there are any when the market recovers, the insistence that homeowners get additional relief so that there’s some reciprocity. If in fact we’re bailing out or helping banks, they in turn have to help rework mortgages for people who are potentially facing foreclosure.

And the final thing, the issue of executive compensation, making sure that taxpayer money is not going to pad bonuses or golden parachutes.

It appears that those principles have all been incorporated into the core agreement. And I’m going to be reviewing the language over the next day to make sure that those provisions actually stick.

Ultimately, I believe that we have to get something done. And so if I feel that those are meaningful provisions that provide some constraints on how the treasury operates and this is not going to be welfare for Wall Street, then my inclination is to support it, because I think Main Street is now at stake.

This could affect every sector of the economy. If the credit crisis continues or worsens, then suddenly small business people can’t make their payroll. You have large businesses who can’t sell corporate debt, which could bring the entire economy to a grinding halt.

The last point I want to make on this is we have to remember how we got here. Not so much to allocate blame, as to understand the choices that are going to face the next president. Unless we update our 20th century regulatory framework for a 21st century global financial system, then we’re going to continue to be vulnerable to this kind of situation, and I think the next president has to come in with a very strong package of reforms.

OBAMA: We’re going to have to fight off the lobbyists and the special interests. And, finally, we’ve got to understand that, contrary to what John McCain suggested at the beginning of this crisis, the fundamentals of the economy are not strong.

And some of the root causes of this crisis have to do with the day-to-day struggles that ordinary people are going through, with flat wages and incomes but constantly increasing costs.

That puts pressure on them to take out more debt, to use home equity loans, to try to refinance. It created an environment in which this kind of crisis potentially could occur.

SCHIEFFER: So, as it stands now, from what you understand about it, you will support this?

OBAMA: As it stands now, if the four principles that I laid out 10 or 12 days ago are, in fact, contained in a meaningful way -- the tax payer protection, the investor participation of taxpayers, the corporate, or the CEO compensation issues, as well as the homeowner assistance -- if those are contained, my inclination would be to vote for it, understanding I’m not happy about it.

We should have never gotten into this place in the first place. And I think this is a final verdict on eight years of failed economic policy.

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