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Maria Bartiromo Speaks to Director of the Office of Management & Budget Jim Nussle on "Closing Bell" Today at 3:20 PM ET (Transcript Included)

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WHEN: TUESDAY, SEPTEMBER 18th
WHERE: CNBC'S "CLOSING BELL"

The following is the unofficial transcript of a CNBC interview with Jim Nussle, Director of the Office of Management & Budget, on CNBC's "Closing Bell" today. All references must be sourced to CNBC.

In the interview with CNBC's Maria Bartiromo, Nussle discusses the Federal Reserve's interest rate cut, balancing the budget and federal spending, among other topics.

MARIA: WELCOME BACK, TODAY OFFICIALS ARE GETTING TOGETHER HERE AT THE RIGHT IN INTERNATIONAL PLAY CENTER TO DISCUSS WAYS TO PROMOTE INNOVATION. AND ECONOMIC DEVELOPMENT ACROSS THE UNITED STATES KEEPING AMERICA GREAT. JOINING ME KNOW TO TALK ABOUT THAT IS JIM NUSSLE, DIRECTOR OF THE OFFICE OF MANAGEMENT AND BUDGET. GOOD TO HAVE YOU WITH US. THEY GIVE FOR JOINING US. FIRST OFF, LET ME GET YOUR REACTION TO WHAT WE'RE ALL TALKING BADEN THAT IS THE FEDERAL RESERVE CUT INTEREST RATES. I REALIZE YOU CANNOT COMMENT ON THE FED, RIGHT? SO CAN YOU CHARACTERIZE WHERE WE ARE RIGHT NOW ON THE ECONOMY AND WHETHER OR NOT YOU THINK SOME BENEFIT TO 50 BASIS POINT CUT WOULD ACTUALLY HAVE AN IMPACT IN TERMS OF BOOSTING THINGS?

NUSSLE: I DON'T TAKE ECONOMIC GROWTH FOR GRANTED, IS ONE OF THE IMPORTANCE DRIVERS OF EVERYTHING WE DO HERE IN WASHINGTON, IS A LOSS DO WITH OUR FISCAL POLICY AND MAKING SURE WE'RE COMPETITIVE, MAKING SURE WE HAVE STRONG GROWTH IN THE ECONOMY IS ALWAYS IMPORTANT. ANYTHING THAT CAN POSITIVELY IMPACT THAT IS SOMETHING THAT IS A GOOD THING. NO, WE DON'T LIKE TO COMMENT ON THE PUTS AND TAKES OF THE FED POLICY, THING THAT IS SMART, AN INDEPENDENT FEDERAL RESERVE, WANTS TO KEEP IT THAT WAY, A LOT OF CONFIDENCE IN CHAIRMAN BERNANKE, BUT WHO WANT TO MAKE SURE THAT WE'RE FOCUSED ON ECONOMIC GROWTH AND EVERYTHING WE CAN DO TO INCREASE OUR COMPETITIVENESS.

MARIA: SOMETIMES THE PSYCHOLOGY OF A CHANGE IN RATES IS VERY HELPFUL.

NUSSLE: WE SAW THAT TODAY CERTAINLY

MARIA: WE'RE SAYING HUGE MARKET DIRECTION. I'VE GOT TO GET YOU REACTION ON WHAT GREENSPAN SAID OBVIOUSLY IN THIS BOOK AND OVER THE WEEKEND ALL THE MEDIA IS JUMPING ON THE IDEA THAT HE SAID LOOK, THE REPUBLICANS DESERVE TO LOSE, THAT THEY GIVE UP A LOT WHEN THEY DIDN'T VETO SPENDING BILLS AND TOO MUCH SPENDING AND GOVERNMENT. YOU'RE THE OMB DIRECTOR, WHAT TO SAY ABOUT THAT?

NUSSLE: THE GOVERNMENT AS TOO BIG AND SPENDS TOO MUCH, I TOTALLY AGREE WITH THAT CONCEPT. WHAT CHAIRMAN GREENSPAN ALWAYS DID WHEN HE AND I HAD AN OPPORTUNITY TO TALK OR WHEN HE CAME BEFORE MY COMMITTEE WHEN I WAS A CHAIRMAN IN CONGRESS IS THAT WE FOCUS ON THE LONG TERM, WE HAVE UNSUSTAINABLE RATES OF GROWTH AND OUR ENTITLEMENT SPENDING. SOCIAL SECURITY, MEDICARE, MEDICAID, THE CHAIRMAN CAME OUT AND I THINK GIVE US A GOOD BROAD FRAMEWORK IN WHICH TO DISCUSS THOSE LONG-TERM SPENDING OBLIGATIONS. WE NEED TO MOVE THAT FORWARD IN A POSITIVE WAY.

MARIA: SO HOW DO YOU BALANCE THE BUDGET BY 2012? WHAT ARE YOUR IDEAS IN TERMS OF RESTRAINING FEDERAL SPENDING?

NUSSLE: WE'RE ON A PATH TO BALANCE THE BUDGET BY 2012, THE CONCERN I HAVE AT INTO THE CONCERN THAT GREENSPAN AND OTHERS HAVE, 2012 IS JUST ONE STEP ALONG THE WAY TO 2016, 17, 18, WHEN FOR INSTANCE SOCIAL SECURITY TURNS UPSIDE DOWN AND WE PAY OUT MORE IN BENEFITS THAN WE ACTUALLY TAKE IN THE PAYROLL TAX. THAT IS A HUGE CHALLENGE FOR US GOING FORWARD THAT IF WE DON'T START MAKING DECISIONS NOW, NOT ONLY SOCIAL SECURITY AND RETIREMENT, BUT ALSO LOOKING AT OTHER CHALLENGES IN MEDICARE AND MEDICAID, FOOD AND START MAKING SOME OF THOSE DECISIONS NOW, THE ONLY GET HARDER AND 15, 16, 17 YEAR WINDOW.

MARIA: ALL ALONG YOU NEED TO SEE CONSISTENT ECONOMIC GROWTH. HE WE ARE TODAY TALKING ABOUT THE FEDERAL RESERVE LOWERING INTEREST RATES WITH THE DISCOUNT AND FED FUNDS RATE TODAY AT THAT MEETING AT THE FED WHAT DO YOU NAME AS THE BIGGEST CHALLENGE FOR THE FISCAL HEALTH OF THIS COUNTRY LONG TERM CHOOSE 10 YEARS, 20 YEARS?

NUSSLE: ITS GOTTA BE THESE LONGTERM ACCOUNTS SOCIAL SECURITY, MEDICARE, MEDICAID, THEY'RE GROWING AT AN UNSUSTAINABLE RATE. THAT'S NOT JIM NUSSLE TALKING THAT IS ALMOST EVERY GOVERNOR TALKING, THE PRESIDENT, ALL THE PRESIDENTIAL CANDIDATES SAY THAT, WE NEED TO HAVE A POLICY, THE PRESIDENT HAS PUT FORTH SOME IDEAS, TODAY CONGRESS CAME OUT WITH A TASK FORCE TO HELP ADDRESS SOME OF THOSE LONG-TERM CHALLENGES. WE NEED TO ADDRESS THOSE NOW BECAUSE THEY ONLY GET HARDER EVERY MINUTE THAT PASSES ON THE WAY TO THOSE CHALLENGES BECOMING A REALITY.

MARIA: GOOD TO HAVE IN THE PROGRAM. JIM NUSSLE IS THE OFFICE OF MANAGEMENT AND BUDGET DIRECTOR.





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