WHEN: Today, Tuesday, October 28th at 9:35AM ET
WHERE: CNBC's "Squawk on the Street"
Following is the unofficial transcript of a CNBC EXCLUSIVE interview with Republican presidential candidate Sen. John McCain and vice presidential candidate Gov. Sarah Palin today on CNBC's "Squawk on the Street."
All references must be sourced to CNBC.
MARIA BARTIROMO, host:
Hi, there, Mark, thanks very much. And I am sitting here in their first live
interview together, Senator John McCain and Governor Sarah Palin.
Good to have you both with us. Thanks for joining us.
Governor SARAH PALIN: Thank you.
Senator JOHN McCAIN: Thank you.
BARTIROMO: We are in a financial crisis, clearly. We are expecting further
layoffs and further banks to go belly-up. Why should the American people
believe and feel that the two of you have your hands on the wheel and can take
us out of this?
Sen. McCAIN: Well, because we have a plan of action to get America's economy
going again, Maria, and it has to do with a wide range of prescriptions. But
one of them is to keep people in their homes. Look, it was the housing crisis
that started this, OK? Fannie and Freddie, this--was the catalyst that blew
this whole thing up. And frankly, the administration is not doing what I
think they should do, and that's go in and buy out these bad mortgages, give
people mortgages they can afford, stabilize home values and start them back up
again. They did that during the depression, it was called the Home Owners'
Loan Corporation. We got to keep taxes low, we got to cut spending, we got to
find alternative fuels, including offshore drilling and nuclear power. And we
have to have a positive agenda for job creation. But I'd like to start with
keeping people in their homes.
BARTIROMO: So, over the short term your plan is to keep people in their homes
and buy those mortgages.
Sen. McCAIN: Create...
BARTIROMO: Over the longer term?
Sen. McCAIN: Over the longer term, as happened in the, by the way, during
the Great Depression, was that over time money came into the Treasury.
Obviously we have to stabilize our financial institutions, we have to unfreeze
credit. How do you do all that? You create jobs in America. And we can do
that in a broad variety of ways, and one of them is to stop this $700 billion
transfer to countries that don't like us very much. Now, I know the price of
oil is down temporarily, and that's reflective of a lot of conditions in the
world. But we still have to free ourselves of our dependence on foreign oil,
because over time it's still a finite resource.
BARTIROMO: Governor Palin, what about that? Now oil's around $60 a share--a
barrel. Is it still an important issue to become energy independent? And how
do you do it?
Gov. PALIN: Now is our opportunity to seize this and to be able to invest in
the domestic solutions that are here now for that offshore drilling that is
safe and responsible, for the nuclear that we need to tap into and the
alternative sources. And yeah, drilling for the sources that we know are here
and flowing that natural gas in the pipelines that we're building up there in
Alaska, also. Now is the opportunity that we have, and we better seize it.
We cannot lull ourselves into this false sense of security just because the
price of a barrel of oil today is 64 bucks, it's about half of what it had
been I think even when we were speaking last, Maria. But no, now's our
opportunity. The domestic solutions that are there, we tap into them, we
become less and less beholden then on foreign sources of energy, and we
circulate, as he says, these hundreds of billions of dollars a year in our own
country, creating jobs for America.
BARTIROMO: Senator, there are a lot of...
Sen. McCAIN: (Unintelligible)...look who we're dependent on. Look at the
part of the world we're dependent on. Look at Hugo Chavez. Look at the--it's
a matter of national security. And by the way, nuclear power, which I'm a big
proponent of, as you know, reduce greenhouse--reduces greenhouse gas emissions
dramatically. So it's environmental, it's national security and it's an
economic issue. It's not the only answer, but building 45 nuclear power
plants creates 700,000 jobs in America.
BARTIROMO: Speaking of national security, Joe Biden said that if Obama is
elected he will be tested in the first six months. In your view, who is most
likely to test him, and how would you and Obama handle it differently?
Sen. McCAIN: Well, I've been tested, to start with. Second of all, Senator
Obiden was right--Senator Biden was correct. Senator Biden--if Sarah or I had
said that, can you imagine the reaction? Scaring Americans, etc. But Senator
Biden had it right. This is an untested individual who has been wrong on the
things he's been tested about. He still refuses to acknowledge that he was
wrong about the surge. When Russia committed aggression against Georgia, he
asked Georgia to exercise restraint. The list goes--said he would sit down
with the Castro brothers, Chavez and Ahmadinejad without any preconditions,
thereby legitimizing their radical, aggressive anti-American, anti-peace
positions. So I agree with Joe Biden. I couldn't have said it myself first,
but he's right. This is an inexperienced person who so far has exercised bad
judgment about national security.
Gov. PALIN: And it wasn't just Joe Biden, though. That was confirmed by
Madeleine Albright, too, saying of course, he was stating fact that there
would be that testing of someone who was inexperienced, not ready to lead; as
Joe Biden had been telling us all along in the primaries, that Barack Obama is
not ready to be commander in chief.
BARTIROMO: Do you--do you worry about the attacks?
Sen. McCAIN: She said, `Mark my words.' She said...
BARTIROMO: I know I asked the question, but there's so much mud slinging
Sen. McCAIN: Good.
BARTIROMO: People really want answers and solutions here.
Sen. McCAIN: Yeah. Sure.
BARTIROMO: There are many issues I'd like to get to.
Sen. McCAIN: Sure.
BARTIROMO: In addition to taxes, unions. Why haven't you made the union
issue a campaign issue? That is, the right to have a secret ballot. Why
isn't this a major issue on your agenda?
Sen. McCAIN: You know, we've talked about it a lot and unfortunately,
there's three or four issues that you can get out strongly. But this
is--we've been talking about for a long time. This is a threat to the
fundamental of labor management relations. It's fundamental to democracy, the
right to have a secret ballot. The way that Senator Obama envisions and the
unions--and this is their big push, and they've gotten commitments from
Senator Obama and Senator Biden--union organizer goes to your house and says,
`Hey, Joe, can I sign you up for the union?' That is--we all know what that
opens the door to. It's dangerous for America, it's dangerous to small
business and I think it's a threat to one of the fundamentals of democracy.
BARTIROMO: Will you veto the bill?
Sen. McCAIN: In a New York minute, if I may say that. I will do everything
in my power to block such legislation. And imagine, Senator Obama, Nancy
Pelosi and Harry Reid pushing the union agenda. It'd be very, very, very
BARTIROMO: Let me--let me go back to the tax issue. Over the long term, you
want to keep taxes low. We're spending $10 billion a month on the war in
Iraq. Why not allow--why not make the American people pay for it?
Sen. McCAIN: Because we study history. History shows that if you practice
protectionism and isolationism and at the same time you raise taxes, you send
an economy from a recession into a depression. That's history. The guy's
name was Herbert Hoover. And it was aided and abetted later on. This is the
worst time to raise anyone's taxes. And obviously Senator Obama has now,
thanks to "Joe the Plumber" and other research have authenticated, he wants to
redistribute the wealth. He wants to, quote, "spread the wealth around" by
taking money from one group of Americans and giving it to another. And as you
know, that number--level of income goes down and down and down and down. And
BARTIROMO: Will you ask Treasury Secretary Hank Paulson to stay on at least
temporarily if you win?
Sen. McCAIN: I think it would depend on the situation at the time. I'm
disappointed that Secretary Paulson has not put first emphasis on buying these
home loan mortgage--these home mortgages and keeping people in their homes.
So I admire and respect him, but I certainly would have somebody who'd give
that our highest priority. As you know, that the chairperson of the FDIC has
also agreed with that. Get the home values under control and back up again.
BARTIROMO: We're going to continue our conversation, but I'm going to send it
back to the live program right now. I'd like to ask you how your partnership
is going, and how unified you are, actually. That will be on the CLOSING BELL
today. We'll also talk about the redistribution of wealth. In the meantime,
I'll send it back to you, Mark and Erin.
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