2008-09-25 Bill Clinton on economic crisis/transcript

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LAUER: Are key right now.
CLINTON: Yes. In other words, the people that are going -- that could really move enough money to shake the foundations of our system, if they're asking silly questions and looking like they're making cheap points to kick the can down the road and avoid a decision, that could hurt.

If they're asking serious questions like, "Now, tell me again how will the $700 billion be invested so we maximize the chance that homeowners stay in their homes and that the taxpayers don't get ripped off and there's no unjust enrichment." Now, let's just answer those three questions. If that's it, I think that's OK. They should take a couple days and do that.

LAUER: The president said we have time to debate the origins of this crisis but last night in his speech to the nation he also said the roots go back more than a decade. You can do the math there, what he was suggesting. He's suggesting that the roots are with your administration. How do you respond to that?
CLINTON:

Well, I think he's suggesting that, when we -- I signed a bill that the banking industry wanted to let them get into securities issuance there. There are some people who believe that that bill enabled them to somehow participate in some of the riskier housing investments.

I disagree with that. That bill primarily enabled them to, like the Bank of America, to buy Merrill Lynch here without a hitch. And I think that helped to stabilize the situation.

I think that the main thing that you could blame the Democrats for, maybe, is that we should have made more of the problems of Fannie Mae and Freddie Mac and maybe the -- and tried more aggressively to regulate derivatives. But this thing really took off when the SEC, under this administration, exercised less oversight and they got rid of something called the uptick rule, which enabled betting down...

LAUER: Right.
CLINTON: ... on housing stocks to go crazy.
LAUER: There's an article in the New York Times in September of 1999 -- so during your administration -- that says that your administration pressured Fannie Mae to increase the number of lower- and middle-income families and individuals who could get a mortgage, and thus own a home, and that to accomplish that Fannie Mae lowered their standard for credit, these subprime mortgages. And while the article said it was well-intentioned, it was dangerous.

Would you agree with that?

CLINTON: I think, through the lens of this, it looks like that was true. But let's go back to where we were at the time. At the time, they had lots of money, were making lots of money, and I thought too much of the money was being given out in value to the shareholders and compensation to the executives. And, at the time, we had a balanced budget and a surplus and a rapidly growing economy in other areas.

So the problem that we had -- and we were going toward two- thirds. Then in this decade, we tried to get homeownership up to 70 percent with no other economic activity. I think you have to look at it at the time. I think it was much less risky now -- then than such a move would have been, let's say, two years ago.

LAUER: Presidential politics has worked its way into this. Senator McCain says we need to suspend his campaign. He'd like to delay Friday night's debate. Is that a proper theory, in your opinion, or do you think, in some ways, he is playing politics with this economic crisis?
CLINTON: First of all, I don't have a judgment about whether it would be a good or bad thing to do. But we know -- I mean, he wanted actually more debates, so we know he wasn't afraid of the debates.

I think he's probably looking for some way of, once again, to say to the American people, "Hey, I'm not a traditional Republican. And I do take this seriously." Because otherwise this makes it much, much more difficult for him to win because this is associated with lax regulation and the absence of economic activity in this period.

I think -- but I think, you know, they both issued a statement last night, which I thought was a good thing, their joint statement. Because I really do believe that if it looks like they're playing politics with this and there's a delay, then that's bad for the confidence.

I think, if it looks like -- they're going back to Washington, which apparently they both are...

LAUER: Right.
CLINTON: ... at the invitation of the president, to get their briefing, they will participate in the lawmaking, the work of their jobs, I think we'll be all right. They've been -- they've -- both of them have gone out of their way, I think, not let this whole thing get too much caught up in the politics.
LAUER: How is all this impacting what's going on in this room and this hotel, this Clinton global initiative this week? You've raised something like $30 billion.
(CROSSTALK)
LAUER: Are you finding it harder when you go to people and say, "Look, I need your help, I need your money," and they're in the middle of a financial crisis? Do you have to modify your goals?
CLINTON: Well, the answer to that is, I didn't know until we got here. You know, I didn't know if we'd have another banner year, not only just in terms of money but in terms of time and the commitment.

A lot of the companies -- for example, Procter & Gamble made an announcement last night of what they're doing to help me fight infant mortality and diarrhea-related deaths in poor countries, a big problem when you don't have any access to clean water. And they came roaring through.

CLINTON: Now they've got global operations so they're pretty healthy. But the president of Coca-Cola said yesterday, "Look, those of us who operate around the world know that if we're in this in the long run we can't back away just because our stock price takes a hit in a down market. We have to behave as if we're going to be here next year and the next year."

So, so far, they've hung in there. The foundations have hung in there, because they have to spend a certain amount of money in their foundation every year.

But I think mostly these people know that building more economic opportunity and education and health care and fighting climate change and creating jobs, doing it, that that's also a part of restoring confidence.

LAUER: Right.
(CROSSTALK)
LAUER: So, real quickly...
CLINTON: So far, so good.
LAUER: So real, real quickly: How do you measure success for this year's initiative?
CLINTON: I measure success by how many lives are going to be touched by the things we're doing, much more than by money.

Let me just say, on our side, money's different from the way you would do it, like how much are you spending in education. If you -- we have more commitments this year in energy, for clean energy, that just costs more up front. But what I -- the health care and the education and even the economic development programs don't cost as much.

So what I want to do when this is over is see how many countries are affected, how many people are affected, how many lives are saved. We're in the problem-solving and life-saving business, and I think it's going to be a very good year.

LAUER: I wish you luck with that.
CLINTON: Thank you.
LAUER: And I thank you for your time. It's always good to see you.
CLINTON: Thank you.