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FIRST ON CNBC: CNBC INTERVIEW: MICHAEL STEELE, RNC CHAIRMAN, ON CNBC'S "SQUAWK ON THE STREET" TODAY

Jennifer Dauble
Tuesday, 22 Jun 2010 | 12:41 PM ET

WHEN: Today, Tuesday, June 22nd

WHERE: CNBC's "Squawk on the Street"

Following is the unofficial transcript of a FIRST ON CNBC interview with Michael Steele, RNC Chairman, today, Tuesday, June 22nd, on CNBC's "Squawk on the Street."

All references must be sourced to CNBC.

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RNC Chair at the NYSE

Republican National Committee Chairman Michael Steele discusses the current political landscape with CNBC's Mark Haines.

HAINES: A LOT HAPPENING IN WASHINGTON. PETER ORSZAG LEAVING OBAMA'S ADMINISTRATION. HIS ECONOMIC TEAM, FINREG IN THE HOMESTRETCH. TWO DAY FED MEETING. AND HERE AT THE BIG BOARD TO TALK ABOUT IT, RNC CHAIRMAN, MICHAEL STEELE. GREAT TO HAVE YOU HERE

STEELE: GOOD TO BE WITH YOU

HAINES: FIRST OF ALL, KIND OF A BIG PICTURE QUESTION. SOME PUNDITS ARE SAYING THERE'S AN ANTI-INCUMBENT MOOD IN THE COUNTRY? LATEST CBS "NEW YORK TIMES" POLL SHOWS TWO OUT OF THREE FEEL THE COUNTRY IS ON THE WRONG TRACK. AT THE SAME TIME YOU'VE GOT THIS TEA PARTY THING COMING AT YOU FROM THE RIGHT. ARE YOU CONFIDENT THAT THE REPUBLICAN PARTY IS GOING TO BE ABLE TO NAVIGATE THESE SHORES AND COME OUT AHEAD IN NOVEMBER?

STEELE: I'M EXTREMELY CONFIDENT. THERE'S BEEN A LONG CERTAINLY BY MY OFFICE AT THE RNC LONG REACH INTO TEA PARTY MOVEMENT IN THE COUNTRY TO HAVE A CONVERSATION EARLY ON GOING BACK AS EARLY AS APRIL OF LAST YEAR. WHAT YOU SEE IS A REACTION TO POLICIES THAT HAVE CAUSED THE AMERICAN PEOPLE TO AT LEAST PAUSE AND EXPRESS SOME CONCERN. WHETHER IT'S ON HEALTH CARE, WHETHER IT'S ON THE ECONOMY, WHETHER IT'S ON A HOST OF OTHER ISSUES.SO I THINK THAT REALITY IS SETTING IN FOR A LOT OF FOLKS. YOU SEE THE TURBULENCE IN THE ELECTIONS SO FAR WITH INCUMBENTS LOSING PRIMARIES AND OTHERS RETIRING BECAUSE THE LANDSCAPE IS NOT HOSPITABLE TO THOSE CARRYING THE WATER.

HAINES: YOU ARE, NONETHELESS, THE TEA PARTY SAYS WE'RE NOT A SLAM DUNK. WE'RE NOT IN THE REPUBLICAN POCKET

STEELE: OF COURSE NOT

HAINES: NUMBER TWO IN A COUPLE OF INSTANCES THE TEA PARTIERS HAVE OPTED FOR CANDIDATES THAT CAN BE FAIRLY DESCRIBED AS OUT ON THE FRINGE. SOME PEOPLE FEEL THEY MAY DRAG YOUR PARTY IN THAT DIRECTION --

STEELE: NO I DON'T THINK SO.

HAINES: YOU ENDORSE RAND PAUL?

STEELE: ABSOLUTELY HE'S BEEN NOMINATED FOR OFFICE

HAINES: THE 64 CIVIL RIGHTS ACT SHOULD BE REVIEWED

STEELE: I DISAGREE WITH HIS POSITION ON THAT ISSUE BUT MY GOODNESS A CAMPAIGN IS MADE UP OF MORE THAN ONE ISSUE.

HAINES: THAT'S A PRETTY BIG ONE.

STEELE: IT'S BIG ISSUE BUT NOT RELEVANT TO THE CONVERSATION TODAY. THE CONVERSATION TODAY IS TALKING ABOUT THE JOB LOSSES OVER 2 MILLION JOBS LOST IN THIS ECONOMY, THAT THIS ADMINISTRATION SAID THEY WERE GOING TO CREATE INSTEAD.THEY CREATED 400,000 GOVERNMENT JOBS. HOW ABOUT EMPLOYING PEOPLE WHO ARE MOMS AND POPS OUT HERE.YOU TALK ABOUT AN UNEMPLOYMENT RATE HOVERING CLOSE TO 10% WHEN WE WERE ASSURED IT WOULDN'T GET PAST 8% IF YOU JUST PASS THAT STIMULUS BILL. THESE ARE THINGS PEOPLE ARE FOCUSED ON. YOU CAN YOU TAKE AN ISSUE AND BLOW IT UP TO DISTRACT. THE FACT IS THE AMERICAN PEOPLE ARE STILL FOCUSED ON THEIR POCKETBOOKS AND THE FACT TOMORROW MORNING THEY MAY GET A PINK SLIP WHEN THEY GO TO WORK.

BURNETT: SO IT'S EASY TO SAY THE PRESIDENT DOESN'T HAVE A CLEAR PLAN FOR JOBS. IT'S EASY. ANYBODY COULD SAY THAT BUT I HAVEN'T HEARD --

STEELE: IT'S MORE THAN EASY IT'S EVIDENT.

BURNETT: HERE'S THE PROBLEM. NO ONE ELSE HAS COME UP WITH ANYTHING EITHER.AND THE FRUSTRATION I THINK PEOPLE FEEL, WHATEVER THEIR PARTY IS, IS THERE'S A LOT OF FINGER POINTING GOING ON AND NOT A LOT OF NEW IDEAS.

STEELE: I DISAGREE WITH THAT I THINK THERE'S A LOT OF THINGS PUT ON THE TABLE THAT THIS ADMINISTRATION IGNORED. WE TALKED ABOUT FREEING UP THE CAPITAL MARKETS AND CREDIT MARKETS TO ALLOW SMALL BUSINESS TO ACCESS THAT CAPITAL AND CREDIT SO THEY CAN INVEST.

BURNETT: WHAT WOULD YOU DO DIFFERENTLY THEY HAVE A DIFFERENT PLAN EVERY WEEK THAT HAS HAD BIPARTISAN SUPPORT.

STEELE: FIRST OF ALL, DON'T TRUST THE FEDERAL GOVERNMENT TO GET IT DONE. WE'RE HERE ON WALL STREET. WE ARE ON MAIN STREET. TRUST THOSE PEOPLE WHO BUILT THE ECONOMY IN THE PAST.THE FEDERAL GOVERNMENT HAS NEVER CREATED ONE JOB THAT IS SUSTAINABLE LONG TERM. IT CREATES GOVERNMENT PROJECT WORK BUT NOT CREATING REAL WORK WHERE PEOPLE ARE.

BURNETT: GOOD LUCK TELLING THE AMERICAN PEOPLE TO TRUST WALL STREET

HAINES: YEAH

BURNETT: TO CREATE AMERICAN JOBS

STEELE: I'M NOT SAYING I'M SAYING TRUST THE PEOPLE WHO CREATE THE WEALTH AND THE ECONOMY OF THE COUNTRY. SMALL BUSINESS OWNERS

HAINES: THOSE ARE THE SAME PEOPLE WHO ALMOST DESTROYED THEM

STEELE: THEY DID NOT SMALL BUSINESSES DIDN'T DESTROY -- THE BULK OF THE JOBS CREATED IN THIS COUNTRY COME FROM SMALL BUSINESS OWNERS. SO WHEN YOU SAY THEY ARE THE ONES THAT ALMOST DESTROYED THEY ARE NOT. THERE ARE BAD APPLES IN ANY SITUATION, IN ANY SCENARIO NO DOUBT ABOUT THAT. BUT YOU CANNOT DEMONIZE DEMAGOGUE AGAINST THE ENTIRE SYSTEM BECAUSE THE REGULATORY PROCESS BROKE DOWN BECAUSE INDIVIDUALS BOTH IN GOVERNMENT AND THE PRIVATE SECTOR GOT GREEDY.

BURNETT: BUT WHAT WOULD YOU DO -- WHAT WOULD YOU DO -- IN ALL HONESTY.THERE'S BEEN A NEW SMALL BUSINESS LENDING PROGRAM, LOAN GUARANTEES FROM THE STATES ALL KINDS OF WAY TO SPARK THE SMALL BUSINESS ENGINE.BOTH PARTIES WOULD SAY WE WANT SMALL BUSINESS.NUT NONE OF THAT APPEARS TO HAVE WORKED.WHAT SPECIFICALLY IS THE REPUBLICAN PARTY GOING TO OFFER?

STEELE: BECAUSE AGAIN, THOSE PROGRAMS ARE TIED TO ALL YOU GOT TO LOOK AT THE STRINGS ATTACHED TO THE PROGRAM. WHAT IS THE COST OF THOSE PROGRAMS TO THE SMALL BUSINESS OWNERS? EVERYBODY IS TELLING SMALL BUSINESS THE HEALTH CARE REGIME WILL WORK FOR THEM.AS WE'RE FINING UP, PREMIUMS ARE GOING UP.EMPLOYERS ARE BETTER TO DUMP THEIR EMPLOYEES INTO THE GOVERNMENT PROGRAM. LET'S GET BEYOND WHAT'S ON PAGE ONE AND LOOK AT WHAT'S BEHIND THE RHETORIC AND WHAT WE SEE IS AN ADMINISTRATION AND ITS POLICIES THAT HAVE NOT PUT IN PLACE THE BUILDING STONES TO ALLOW SMALL BUSINESS OWNERS AND THOSE ENTREPRENEURS OUT THERE WHO ARE WILLING TO TAKE BE THE RISK TO TAKE THAT RISK.THEY ARE JUST SITTING THERE. WHAT YOU'RE SEEING IS A JOBLESS RECOVERY. THE MARKET DOING OKAY HERE AND THERE AND GROWTH OVER THERE AND MAYBE A LITTLE BIT OVER THERE BUT IT'S NOT GETTING DOWN TO WHERE IT NEEDS TO GO SO THAT YOU AS AN ENTREPRENEUR WILL SAY, YOU KNOW WHAT?I'LL HIRE MARK TODAY BECAUSE I NEED TO EXPAND MY BUSINESS.

HAINES: THIS IS VERY SIMILAR TO WHAT WE WENT THROUGH UNDER GEORGE BUSH.

STEELE: HOW DO YOU MEAN

BURNETT: WE HAD A JOBLESS RECOVERY

HAINES: COMING OUT OF THE 2001 RECESSION.

STEELE: GEORGE BUSH CREATED LOT OF JOBS.

HAINES: I BEG YOUR PARDON?

STEELE I THINK THERE WERE JOBS CREATED IN THE EIGHT YEARS THAT GEORGE BUSH WAS --

BURNETT: WE COULD PULL UP THOSE NUMBERS.

STEELE: I COULD PULL UP SOME NUMBERS TOO. LET'S PUT MY NUMBERS AGAINST YOUR NUMBERS AND SEE WHAT WE FIND OUT

HAINES: I LEAVE IT TO ANYONE OUT IN THERE AUDIENCE TO RESEARCH THAT THE BUSH ADMINISTRATION WAS A NET LOSS

STEELE: HOW MANY JOBS OVER EIGHT YEARS?

HAINES: I DON'T KNOW THE EXACT NUMBER

STEELE: YOU GOT THAT NUMBER? I THINK THE JOBS WERE CREATED. I'M ALMOST CONFIDENT IN THAT.I THINK THE MARKETS REFLECTED THAT AS WELL.

HAINES: I'M SORRY?

STEELE: I THINK THE MARKETS REFLECTED THAT AS WELL. THE GROWTH IN THE MARKET?

HAINES: THE GROWTH IN THE MARKETS

STEELE: ON MAIN STREET AND WALL STREET. THOSE MARKETS REFLECTED THAT.

HAINES: SO, DID LEHMAN BLOW UP AND ALL THAT DIDN'T HAPPEN ON BUSH'S WATCH?

STEELE: NOW YOU SWITCHED.

HAINES: YOU TALKED ABOUT THE MARKETS. THE MARKETS TANKED.

STEELE: YOU WENT TO THE END OF THE TERM --

HAINES: THAT DOESN'T COUNT?

STEELE: IT DOES COUNT.

HAINES: HE WAS STILL IN TOWN.

STEELE: OKAY. TAKE YOUR ROSE COLORED GLASSES OFF AND LOOK AT WHAT HAPPENED.

HAINES: I'M LOOKING AT WHAT REALLY HAPPENED.

STEELE: THE LEHMAN DEBACLE OCCURRED AT THE END OF THE TERM.NO DOUBT ABOUT THAT FOR A WHOLE LOT OF REASONS TYING BACK TO FANNIE AND FREDDIE GOING BACK TO ALL THOSE INVESTMENTS THAT WERE MADE BY BUSINESSES BANKS AND OTHERS PUTTING CREDIT ON STREET THAT WENT TO PEOPLE WHO COULDN'T AFFORD TO PAY, ALL OF THAT CONTRIBUTED TO THAT RESULT AT THE END.

HAINES: YEP.

STEELE: I'M NOT GOING DENY THAT BUT THAT DOESN'T MEAN YOU PUT YOURSELF IN A POSITION WHERE YOU DEMONIZE AGAINST EVERYTHING THAT HAPPENS HERE ON WALL STREET OR MAIN STREET, THAT YOU ACT LIKE WEALTH CREATION AND PROFIT IS A BAD THING. IT'S NOT. IT'S WHAT SMALL BUSINESS OWNERS AND THOSE IN THE BUSINESS OF A BUSINESS NEED TO EXPAND AND GROW AND THAT'S A GOOD THING.

BURNETT: READY FOR THE NUMBERS?

HAINES: WHO WOULD ARGUE AGAINST THAT

STEELE: THIS ADMINISTRATION CLEARLY BEEN ARGUING AGAINST THAT.

BURNETT: IT'S ACTUALLY INTERESTING THE "WALL STREET JOURNAL" WENT THROUGH EACH PRESIDENT ALL THE WAY BACK.GEORGE BUSH NET JOBS CREATED, 3 MILLION JOBS OVER HIS TERM. POPULATION GROWTH OVER THAT TIME FOR THE UNITED STATES WAS 22 MILLION. BILL CLINTON 23.1 MILLION JOBS CREATED POPULATION GROWTH 25.2. GEORGE H.W. BUSH THEN DID 2.5 MILLION JOBS. 12.5 MILLION IN POPULATION

STEELE: I'LL TAKE THE 3 MILLION CREATED UNDER GEORGE BUSH VERSUS THE 2.2 MILLION LOST UNDER THIS PRESIDENT IN 18 MONTHS SO YOU GUYS CAN HAVE IT ANYWAY YOU WANT. THE REALITY IS PEOPLE ARE LOSING JOBS BECAUSE LACK OF TRUST IN FOLKS WHO CREATE WEALTH IN THIS ECONOMY. DON'T TELL ME YOU'LL KEEP UNEMPLOYMENT AT 8% BY SPENDING A LOT OF MONEY AND IT MUSHROOMS TO ALMOST 10. DON'T TELL ME YOU'LL CREATE JOBS WHEN THE JOBS ARE BEING CREATED IN THE GOVERNMENT SECTOR AND NOT THE PRIVATE-SECTOR. AND THAT'S THE REALITY EVERYONE IN THIS COUNTRY SEES RIGHT NOW THE QUESTION IS AND YOU ASKED A GOOD QUESTION WHAT'S THE PLAN?

BURNETT: YES.

STEELE: AND THE PLAN IS I MUCH RATHER TAKE THE BILLIONS OF DOLLARS WE'RE SPENDING ON GOVERNMENT INTRUSION INTO THE MARKETS AND TURN IT OVER TO THE CAPITALIST, THE ENTREPRENEURS AND THE RISK TAKERS OUT THERE TO DO THEIR THING.

HAINES: WE TRIED THAT.

STEELE: NO WE LOOK AND WE WERE SUCCESSFUL IN DOING THAT.

HAINES: WE TRIED THIS UNFETTERED CAPITALISM THAT YOU'RE PREACHING.

STEELE: I'M NOT PREACHING UNFETTERED CAPITALISM.

HAINES: WE WOUND UP WITH A DISASTER ON WALL STREET, A DISASTER IN THE GULF THANKS TO NO REGULATION FROM MMS DURING THE BUSH YEARS --

STEELE: WAIT A MINUTE. THAT'S THE ADMINISTRATION SIDE ALSO ON THAT. THIS ADMINISTRATION SIGNED OFF ON THAT SO DON'T DO A BUSH ADMINISTRATION. YOU GUYS --

HAINES: NO QUESTION, OBAMA ADMINISTRATION --

STEELE: LOOK AT WHERE WE ARE AND GO FORWARD.

HAINES: YOU MUST BE USED TO BUYING TIME AND SPEAKING WITHOUT INTERRUPTION. THERE'S NO QUESTION THAT THE OBAMA ADMINISTRATION DID NOT TAKE STEPS TO REFORM THE MMS AND TO MAKE SURE THAT THE OVERSIGHT WAS, WAS DONE WELL. OKAY.YOU'RE ABSOLUTELY CORRECT.BUT THAT CULTURE BEGAN YEARS EARLIER.

STEELE: DOESN'T MATTER WHERE IT BEGAN. WHAT HAPPENS NOW IS IT'S ON YOUR WATCH AND THAT'S WHERE THE MONEY NEEDS TO GROW.SO, IF THIS HAPPENED OVER HERE, SOMETHING BAD THAT YOU SAY SHOULD HAVE BEEN DONE, AND I PUT OF YOU IGNORE IT AND ACCEPT WHO'S WATCH IS THAT ON --

HAINES: I AGREE.

BURNETT: ONE FINAL QUESTION IN BRITAIN THEY ARE TALKING ABOUT SAVAGE AUSTERITY. THEY ARE PROVIDING ANOTHER ALTERNATIVE TO WHERE THE US IS GOING SOME CAPITAL GAINS TAX ARE GOING UP FROM 10 TO 50 PERCENT, SPENDING IS BEING SLASHED. TAX ON ALCOHOL AND TOBACCO.THAT'S ONE WAY TO GET OUT OF A BAD FISCAL SITUATION. AS MATTER OF FACT, SOME COMBINATION OF SPENDING CUTS AND TAX INCREASES ARE GOING TO HOW YOU DO IT IS THAT HOW THE REPUBLICAN PARTY IS GOING TO COME FORWARD WITH . WE HAVE A SAVAGE AUSTERITY PLAN THIS IS YOUR OPTIONS.

STEELE: WE WON'T HAVE TAX INCREASE BECAUSE WE DON'T BELIEVE TAX IS THE WAY YOU CAN GROW PROSPERITY.

BURNETT: YOU THINK YOU CAN GROW WITHOUT TAX CUTS OUT OF THIS BUDGET SITUATION

STEELE: YOU PUT AN ECONOMIC CHECK ON THE EXPANSION AND SPENDING BY THE FEDERAL GOVERNMENT. LET'S START WITH SPENDING. WHEN I WAS LIEUTENANT GOVERNOR OF MARYLAND OUR ADMINISTRATION INHERITED A $2 BILLION DEFICIT. WHAT DID WE DO? WE WENT BACK AND CUT THE SPENDING OF GOVERNMENT AND THEN WE COULD FAIRLY ASSESS WHAT WAS NEED WHETHER IT WAS FEES OR TAX OTHERS ANY OTHER REVENUE ENHANCEMENTS. ONCE YOU UNDERSTOOD WHERE YOUR BOTTOM LINE IS. IF YOU HAVE THIS MINDSET THAT THE ONLY WAY I CAN GET FROM A TOB IS TO CONTINUE ON THE SPEND WHILE PROMOTING OTHER THINGS LIKE TAX INCREASE OR TAX CUTS YOU'RE DOING THE SECULAR ARGUMENT.

BURNETT: ITS ALL FAIR POINTS ALTHOUGH IT IS REPUBLICANS WHO SHOT DOWN EFFORTS OF THE DEMOCRATS ON TO CUT MEDICARE. IT GOES BOTH WAYS NOBODY IN ANY PARTY IN THIS COUNTRY HAS SHOWED THE INTESTINAL FORTITUDE TO CUT

STEELE: I WOULD AGREE WITH THAT. THAT'S WHY YOU SEE THE MOVEMENT AMONG THE AMERICAN PEOPLE RIGHT NOW FOR SOMETHING DIFFERENT.

HAINES: THAT'S RIGHT.

STEELE: SO WE'LL SEE, WE'LL SEE WHAT THESE CANDIDATES AND WHAT THE NEWLY ELECTED IN NOVEMBER WILL BRING TO THE TABLE AND I GUARANTEE YOU THIS IF THEY GO DOWN THE SAME OLD ROAD THEY WON'T BE IN OFFICE LONG THE PEOPLE WILL CHUCK THEM OUT.

HAINES: WE GOT TO GO. THANK YOU VERY MUCH.

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