WHEN: Tonight, Thursday, January 29th at 8PM ET
WHERE: "CNBC Reports"
Following is the unofficial transcript of a CNBC EXCLUSIVE interview with Vice President Biden tonight on "CNBC Reports."
All references must be source to CNBC.
JOHN HARWOOD, host: First of all, Mr. Vice President, thanks for joining us, and congratulations.
Vice President JOE BIDEN: Thank you, and I'm happy to be with you.
HARWOOD: I've got to start by asking you, you've had a long career and I've covered a lot of it; ups and downs of family tragedy, your own health, politics, two presidential races. After all that, how does it feel to have arrived at this place?
Vice Pres. BIDEN: Unexpected and rewarding. I, you know, all the years you covered me, I never, quite frankly, thought about the vice presidency. You know, it's not that it wasn't--it wasn't a conscious thing, I never thought about it. And when President Obama asked me to join him, I wasn't at all sure about whether there was a right place for me. And--but it's working out--working out from my perspective really very well.
HARWOOD: Tomorrow you're going to announce this middle class task force. When I listened to President Obama's rhetoric in the campaign last year, it seemed as if his entire economic policy was focused on the middle class. So what's the need for this task force, and does its existence indicate that you're going to have to be lobbying and prodding the economic team to do things that they're not otherwise inclined to do?
Vice Pres. BIDEN: No. I think what's happened is that it is the measure of how we're going to measure ourselves. The--you know, the middle class has been, even when good economic times, John, they were being left behind. And in bad economic times they're hurting very, very badly. And so our whole--when I joined the campaign, one of the things that was comfortable about it, he was in the exact same place I was when I was running independently about that's the measure of the health of the nation is how well the middle class is doing. And right now, though, what the president--what happened when he took office, we anticipated to be bad, the economy, but I don't think anybody expected the international climate to be as difficult economically, nor at home as difficult. And so right now he's spending all his time making sure that we just don't drown, keeping this--not just the--our economy, but the world economy afloat. And so what he's asked me to do is head up a task force with all the requisite Cabinet members to deal--making sure that as we go forward with something beyond a rescue, as we go forward in building a budget and building our proposals as to how we're going to have a foundation for the 21st century, that somebody is focusing on and we have a priority list, and everything from retirement savings to college education to compatible work and raising your children circumstances. So all of those things are things that we want to make sure don't fall through the cracks in terms of our longer term planning here. And so that's what my job's going to be.
HARWOOD: Middle class families and everybody else is watching the progress of the stimulus package...
Vice Pres. BIDEN: Yep.
HARWOOD: ...that's moving through the Congress. I was talking yesterday to a longtime Democratic economist, someone who's worked closely with your party who's sympathetic to what you're trying to do, and said, is this the optimum package that the administration and the Congress could put together, from a stimulus point of view, to get this economy going? And the answer was no, not really; that they could have more tax cuts, quicker tax cuts. But it's a political compromise, you've got a lot of Democrats in Congress who think this is their one shot to get a lot of spending priorities that have--they feel have been neglected in the past. Are you comfortable saying to middle-class American families that this is the best that you guys can do? Or do you think it ought to be changed?
Vice Pres. BIDEN: It's not over yet. We've only gone through the first phase of this, that is it's passed the House, which is a big, big step. It's about to pass the Senate, then we're going to go to conference. And I'm sure there's going to be some additional changes in this.
HARWOOD: What kind?
Vice Pres. BIDEN: Well, my guess is you're going to see maybe some additional infrastructure spending, you may see some changes in some of the things that have been put forward by the House in terms of spending, and maybe even some changes in the tax side. But look...
HARWOOD: More tax cuts, then?
Vice Pres. BIDEN: Well, I--that may occur. But here's where we are. You have, as--for a city that did not function for eight years in terms of any kind of bipartisan consensus, any kind of real coordination, here we are, God willing, with less than, you know, 20 days in the first session, passing the most significant stimulus package in the history of the United States of America. That is--and it's going to spend out 75 percent of it quickly. Did it spend out every way we want to? I mean, for example, you have a circumstance where you want to make sure you don't create, as they say, a tail. You don't want to start a spending program...
Vice Pres. BIDEN: ...that locks you into long, long-term spending. And the other side of it is you'd also like to be able to--if you could write it as, you know, there was no Congress, you just write it yourself, you could--you would like to have significant reforms built into this as well. But you know the process on the Hill, you know the process here. So I think it's as close to as good a balance as you can get, because I think it will create three to four million new jobs, I think it will in fact have--begin to lay the foundation for some of the changes in the 21st century we need, particularly with regard to infrastructure, and tax structure, as well. So you know, could that--could it be better? When you have two branches of government and three separate entities working on something, I'm not sure it could have gotten, at this stage, much better than it is. I think it's good. I think you'll see it get better. And I also think you'll see Republicans voting for it.
HARWOOD: Well, let me ask you about that. Notwithstanding all the personal outreach and good feeling on...
Vice Pres. BIDEN: Yeah.
HARWOOD: ...on--from your side and to some degree from the Republican side as well, you had zero Republican votes in the House. Now it goes to your old place, the Senate.
Vice Pres. BIDEN: Yeah.
HARWOOD: There are two ways that you can approach looking at Republicans. One is to say, `You want to vote against a president of 70 percent, with the American people saying in the election they wanted change? You go right ahead and take that risk.' The other is to say, `You know what, we want to do more. You're right about some objections to this package. We're going to make significant changes.' Which is the approach that you guys are going to take, and what is reasonable for you to expect in terms of Republican support in the Senate?
Vice Pres. BIDEN: Well, let's start off. Republican support in the Senate, Republican attitude in the Senate, unrelated to us, is slightly different than the House, substantively, there's a difference. Secondly, a good portion, a significant portion of the elements of this package before it was submitted had Republican input. I personally spoke to seven Republican senators in detail, laid out what do they need in the package, what's important to them. So it was already--we already in the--in the political jargon, quote, "compromised." We don't consider it compromise--coooperated, compromised before we even submitted the package, note number one. Number two, the Senate is going to have--with Republican support, I predict--a--they--they're going to be much more inclined to support a Senate package, which will be somewhat different but not substantially, not significantly different than the makeup of the House package.
HARWOOD: So how many Republican votes could you get?
Vice Pres. BIDEN: Well, I...
Vice Pres. BIDEN: I think--I--well, what I don't want to do is start to put Republicans on the spot by saying how many we'll get. I believe we'll get key Republican support in the United States Senate going into conference. And I predict you will get significant Republican support in House and Senate from the package--I'm sounding like a senator now with the public here; I mean, all the jargon. You know, when the House bill goes over, the Senate bill is slightly different, they sit down, reconcile the differences. That's the final thing the president either signs or doesn't sign. I think the--what is submitted to him on his desk will have significant Republican support as it leaves Capitol Hill to go to his desk.
HARWOOD: In both chambers.
Vice Pres. BIDEN: In both chambers.
HARWOOD: You're someone who has been deeply involved in foreign relations throughout your career, and have appreciated the value of trade not just in economic terms, but also in foreign policy terms; have supported NAFTA, supported normal trade relations with China. One of the issues that's come up on this stimulus package is buy American provisions. Do those make sense? Are they going to be received as hostile by our trading partners? And should other steps be taken to make sure that the benefits only go to American citizens either in tax cuts or tax rebates, or even jobs; that illegal immigrants, for example, should not be eligible for those benefits?
Vice Pres. BIDEN: Well, you've asked a whole lot of questions. They're in the same--in the same bowl...
Vice Pres. BIDEN: ...but they're different questions. Let me say this. I think the American--I don't think there's anything that is anti-competitive or anti-trade in saying when we are stimulating the US economy the purpose is to create US jobs. The same thing's happening in Britain, the same thing's happening in Europe, the same thing's happening in China, and they're not worrying about American jobs. They are legitimately worrying about stimulating their economy to produce jobs. But not absolute requirements. So the notion that we go out and on some of those issues where we're--about--involving government spending, saying that given the option, the same quality product, buy American, I find nothing inconsistent with that. I don't view that as some of the pure free traders view it, as a harbinger of protectionism. I don't buy that at all. So I think it's legitimate to have some portions of buy American in it. But I don't think, if you take a look at what we're saying in the administration, we're not insisting that every single dollar spent only be spent on a--creating a single American job and buying a single American product. So there's a balance there, I think, John. And...
HARWOOD: Restrictions on jobs and tax benefits to US citizens, is that something that should be done?
Vice Pres. BIDEN: Well, that's something that the Senate is going to be dealing with, and I'd rather--you know, one of the things I've learned, having been in the Senate 36 years, I always resented when administrations told me what we were going to do before we acted and did it. Let's see what the Senate does.
HARWOOD: Not ruling that out, though.
Vice Pres. BIDEN: I--it depends on what the package--it's not something we're pushing. But we'll see what the Senate does.
HARWOOD: Treasury Secretary Geithner...
Vice Pres. BIDEN: Yes.
HARWOOD: ...in his testimony said that China was manipulating its currency, which is something that has been a big issue in economic policy domestically here. Do you agree with that, and is it going to be a key policy of the administration to take a tougher approach to China?
Vice Pres. BIDEN: The policy of this administration is going to be to say to China, which occasionally the last administration was reluctant to do, `You're a major player on the world scene economically, and you've got to play by the rules that everybody else plays by. Not more stringent. We're not going to impose on you or attempt to impose on you restraints that benefit our economy inconsistent with trade, international trade agreements that exist.' The term of ours that got everybody upset was manipulation. There's been no judgment based in the administration that there has been a manipulation because, as you know, that word triggers, within trade agreements, certain responses. But it is clear--it is clear that there has been a policy on the part of the Chinese government that I would argue is inconsistent with their long-term economic well-being of having a total export economy and doing things that guaranteed that, promoted that. Understand their problem, they got to create 20 million new jobs a year to keep from falling behind. But it's not sound world economic policy, and so we're going to be, in that sense, blunter with the Chinese about you're in the deal, you play by the rules.
HARWOOD: What about consequences of the kind the past administration didn't support, that your old colleagues Lindsey Graham and Chuck Schumer have talked about?
Vice Pres. BIDEN: Well, that requires a determination that there is, quote, "manipulation." We've not gotten there yet.
HARWOOD: All right, is a so-called "bad bank" to pull up bad assets on the books of many financial institutions, is that a good idea?
Vice Pres. BIDEN: Look, the president and to some extent I, we put ourselves on the line to get another $350 billion for an acronym that no one in the public understands, the TARP, meaning that money to infuse into our banking system to get credit flowing. And an economist who works for me, Jared Bernstein, said you know, it's kind of like if you think of an artery. You have all this plaque buildup in the artery because the diet's been really bad, you've not been taking care of yourself and it constricts the flow of the blood. Well, that's what's happening now, there's a constriction of the flow of credit to normal people, normal credit; people being able to go--oh, you know, a small businessman keeping their inventory, being able to borrow money to send your kid back to college, being able to borrow money to buy a car, or if you're in a position to buy a home in this economy. And so we want to get that flowing. We have to, in order to do that, spend this three--expend this $350 billion much more wisely. It's got to be transparent, it's got to be accountable. Once we do that and see whether or not we can get this system kick-started, the credit system flowing more, that's when we'll make the judgment whether or not anything else is necessary. Now, I would be lying to you if I didn't tell you Secretary Geithner, who's one of the most respected guys in the country, not just because he's secretary of Treasury, he is--I'm sure, I hope, he is considering all alternatives; what happens if this works and it unclogs the artery more quickly than we think, what happens if it doesn't work. Those decisions have not been made. We're going to wait to hear from--first expend it more wisely and prudently and transparently, then--and look, the other thing that happened, I promise you, there ain't going to be any $40 million jets being bought. There's not going to be expenditures of bonuses go--I mean, it's been outrageous. I mean, it just--that's a...
HARWOOD: Bad for a rehabilitation.
Vice Pres. BIDEN: Oh, I mean, yeah. I mean, it's offends the sensibilities. I mean, I'd like to throw these guys in the brig. I mean, it's just like--it's just--I don't know--I do know what they're thinking, and they're thinking the same old thing that got us here, greed. They're thinking, `Take care of me.' And so we've got to demonstrate to the public, to have any credibility in being able to do what is absolutely necessary, infuse some energy into this credit system to get it out there, and these guys are going to bite their nose off to spite their faces if we--as my mother would say--if we don't get it--so the first--the way in which we allocate this $350 billion to get credit markets, those blood vessels flowing a little bit better, is going to determine an awful lot about what, if anything, comes next.
HARWOOD: But you probably saw yesterday that there seemed to be an expectation developing on Wall Street that a bank--a bad bank would be ultimately part of the solution. Is that--is that instinct correct?
Vice Pres. BIDEN: That instinct is premature. It has to be talked about, it has to be considered. We are prudent, we cannot sit here and say, look, there's an awful lot of bad debt sitting out there. And I don't know if the public understands bad debt--I mean, bad bank. I mean, all a bad bank says, to go out and take those very bad assets you have and take them off your books and put them over here and hope that some of them come through, and those that don't we pay for. And then if we make money on it, pump it back in. It's--but it's just premature to make that decision.
HARWOOD: When you think about middle-class families...
Vice Pres. BIDEN: Yes.
HARWOOD: ...the ones you're going to protect in this task force, or try to, do you think of them as victims of low-wage labor from overseas, the practices of other countries, greedy people on Wall Street? Or do you see that mainstream America, middle-class America itself is going to have to change some things about lifestyle, about consumption patterns, about savings, about education? Your wife, of course, is in education. But raising the skill levels? How do you see that?
Vice Pres. BIDEN: All of the above. Look, it's not--there's no--I'm not looking, and have not in my career, looked for boogeymen. There's not one bad guy out there. You go ahead and knock him down, middle class is going to be OK. I think it relates to everything from the way in which labor agreements are negotiated, the way the NLRB has functioned, the way in which credit flows and the way in which we've--the savings rates of Americans, the notion that--being encouraged and buying into naively, this is all free, and anything you need, the money and credit cards. It's all of the above. It's all of the above. But institutionally I would argue that the last eight years the Bush administration has consciously changed the dynamic. Consciously--not because they're bad guys, because they truly believed if the very wealthy did very well--I'm oversimplifying in the interest of time--that everyone else would do very fine. That's not how we think this economy grows, or grows in the past. So everything from work rules, straight through to the issue of personal savings and personal responsibility, are all factored in.
HARWOOD: Is it possible to protect the interests of middle-class families, as you aim to do, if any of the Big Three Detroit auto companies either goes bankrupt or is actually liquidated?
Vice Pres. BIDEN: The answer, it is possible. It obviously makes it more difficult. One of the things I was talking to my staff about yesterday is I do believe--and I make no apologies for it--that over the last 100 years the middle class was built on the back of organized labor. Without their weight, heft and their insistence starting in the early 1900s we wouldn't have the middle class we have now, in my view. So I think labor getting a fair share of the pie is part of it. But the neighborhood I grew up in, John, not everyone viewed themselves as, quote, "labor." A lot of the guys I grew up with are in labor unions and police officers and firefighters, but a lot of them also went to college and they are salespersons...
Vice Pres. BIDEN: ...and they're chemists and are--so the middle class isn't just about finding more blue-collar jobs, which is critically important, critically important. That is sort of the spine of the system. But you ask yourself today, you and I grew up in an era--and I'm older than you, but we grew up in an era where I'm sure our--your parents said the same they said to me, `You got to get a college education. You must get a'--and if you get a college education, you got your ticket punched. You got your ticket punched, without them saying this--into the middle class, meaning you live in a decent neighborhood that's safe, you can send your kids to college, you're not going to be put upon every day financially. Well, even today with a college education people are going, `Whoa, wait a minute.' So I'm not just looking, in this task force, merely at providing for jobs for--as we must and should--for blue-collar workers with high school educations; I'm looking for blue-collar and white-collar workers with college educations, creating the environment in which they'll be able to have a--make a living.
HARWOOD: Couple of other things, quickly. On organized labor, the issue of this Card Check Bill...
Vice Pres. BIDEN: Yeah.
HARWOOD: ...to make union organizing easier is a flashpoint for some in business and labor alike. Is this something that you are--and the administration are nominally for but are going to slow walk, and it's not likely to become law this year or anytime soon? Or is it something that you all are going to try to push for rapidly?
Vice Pres. BIDEN: We're going to try to push for prudently. By that I mean there's only so much on the plate these first couple months. Everyone understands--I think both of us thought 10 months ago that this would be a top-priority item in terms of immediate action. We know there's probably going to be some compromise here. We also know that we have to get more than just Democratic support for this. But we both believe it's very important, making and--taking away the roadblocks that were built up. For example, today when they announce the middle class--I'm probably dating this program, but the--announcing the middle class task force, the president's going to sign four executive orders, and they relate to impediments that executively put in place by the Bush administration making it more difficult for labor to just under the rules that exist--the guys in the striped shirts, you know, calling the--giving them a fair shot at organizing. So we do think making it--taking away the impediments to organization is in the self-interest of labor, but also I believe in the self-interest of economic growth.
HARWOOD: Sounds like that is a 2010 or beyond issue.
Vice Pres. BIDEN: No, no, no, no. This year. This year, we hope. Our expectation is this year, this calendar year, that we will move, and hopefully with some bipartisan support, to dealing with this issue.
HARWOOD: Entitlements. You and President Obama have supported raising the cap on taxation for Social Security as part of a long-term fix. Are you also willing--since so many people say to get both parties involved you have to do benefits side as well as the tax side--are you willing to tell middle-class baby boomers that to protect the finances of their children that they're going to have to accept lower benefit cuts, and when do you expect to move on that issue?
Vice Pres. BIDEN: Well, we're not willing to negotiate anything in public, number one. Number two, we are willing and are aware, especially with the burden placed upon us with the incredible debt we're inheriting, the yearly deficit and a--the awful economic circumstance, that part of the long-term solution here is dealing with entitlements; including Medicare, which is even more immediate and in a sense more consequential in the near term, as well as Social Security. And...
HARWOOD: But benefits included.
Vice Pres. BIDEN: I'm not making that judgment now. I'm not making that judgment. And I--it's not mine to make, it's the president's to make.
HARWOOD: Sure. Of course. Two more things before we go. My colleague at The New York Times, Sheryl Stolberg, had a terrific piece today about the informality of the Obama White House. The president with--in his shirt sleeves in the Oval Office. You've seen a lot of presidents come and go. A little over a week into this one, tell me what's different about the feel of Washington and the White House, from your observation.
Vice Pres. BIDEN: I think it's a big difference. And it's not just, I think, atmospherics. Let me speak to the atmospherics. Number one, this is a guy who welcomes challenging his opinions. This is a guy who's totally, to use that trite expression, comfortable in his own skin. I've never seen--there's never been elected official I've worked with, president or in my iteration when I was a senator for 36 years, who is as incisive and disciplined about what he focuses on. You--I was with him yesterday, as they say, in the tank with this--the Joint Chiefs of Staff. My impression clearly was they were all impressed with this guy they didn't know. The questions he asks, the terms he sets, the way he lays down what his objectives are, he's clear, he's disciplined, there's a precision in his thinking that has surprised everyone, and that goes along--not surprised, struck everyone. And it goes along with a genuine informality. It is--and that informality breeds you being prepared to say, `Well, Mr. President, I don't think that works. I mean, what do you think about,' as opposed to walking in and saying, `Sir,' you know. It's a very different environment. It's not unlike Bill Clinton was--or excuse me, President Clinton's administration, which was--there was some informality about it. But there's a--and he really--he means--two things that have really struck me. One, he really means he wants to get rid of this sort of vituperative attitude down here in Washington about Democrats and Republicans. He means it. He means it. And the second thing is...
HARWOOD: And zero votes in the House doesn't mean that's over?
Vice Pres. BIDEN: No, it doesn't. Because guess what, he invited them down the next night. They--nobody voted for him, and he invited them down. We were there last night. And he--and it's basic, `Look, OK, take time. It's going to take some time.'
HARWOOD: Is he going to make a big difference--you got in some hot water early in the presidential campaign for something you said related to his status as an African-American candidate. Is he, in this city and in this country, going to make a big difference in race relations?
Vice Pres. BIDEN: I don't think he views it that way, but I think just per se it is--it says a lot about America--as he points out, it says a lot more about America than anything else, and it makes--and you can see--I mean, look, you've covered inaugurations. There was a feel here. There was a feel about the country, not just about the administration, about the country. And so I think his--everything about him--culturally, politically, stylistically, all encourages the idea that nothing is impossible, but no inflated promises. Let's get to work, let's get it done, put in the effort, there's nothing we can't do. And I think everything about him reinforces that...(unintelligible).
HARWOOD: Last question. As a Pennsylvania native, are you guaranteeing a Steelers victory in the Super Bowl?
Vice Pres. BIDEN: Well, I'm rooting for a Steelers victory. I know you're supposed to be one of these guys that says I'm not sure. I'm for the Steelers. I love the Rooney family. I'm an Eagles fan first, number two Pittsburgh. I'm having a Super Bowl party at my house with some of our Republican and Democratic friends, and--but I want to make clear, I'm rooting for the Steelers. Go, Mr. Rooney.
HARWOOD: Thanks for being with us.
Vice Pres. BIDEN: Thank you. Appreciate it.
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