STEPHANOPOULOS: The president has made it pretty clear he wants this to be a real bipartisan effort. Yet House Republicans have said they have been shut out of this process. There were no Republican votes in the appropriations Committee, no Republican votes in the Ways and Means Committee. Is this the bipartisan effort President Obama has called for?
PELOSI: Well, because the Republicans don't vote for it doesn't mean they didn't have an opportunity to. We - the Republicans asked for a couple things. One that related to process that you described, that there would be an open process where they could present their amendments. They didn't vote for the final bill but we voted for some of their amendments in the committees that had the markups the day before yesterday and this week.
Secondly, the - some of the ideas that they had put forth in earlier meetings, President-Elect Obama at the time on January 5 had our first bipartisan meeting, House and Senate, Democrats and Republicans and some ideas that were put on the table by the Republicans at that time were contained in the bills that we wrote.
And now this morning they had some more suggestions which we will review and see if they create jobs, turn the economy around and to do so in a cost-effective way.
STEPHANOPOULOS: Some of their suggestions that they've put forward are permanently cutting the two lowest tax brackets from 15 to 10 percent and from 10 to five percent. Also new help for small business.
Can you include those in your package?
PELOSI: When we had the recovery package last year we brought the tax credit all the way down, regarding using payroll tax as tax and therefore you get a credit. Against using that precedent which was established with President Bush, we built upon that in this legislation and we prefer that route.
STEPHANOPOULOS: they're saying that's giving a check to people who don't pay taxes rather than cutting taxes for people who do.
PELOSI: But they do pay taxes. Payroll tax. And President Bush agreed with that last year and using that precedent we have built upon that.
STEPHANOPOULOS: So you're not going to take these new Republican ideas.
PELOSI: We will take some. We will judge them by their ability to create jobs, to help turn the economy around, to stabilize the economy and to see how much they cost.
But we're open to them and we'll review them and it all has to be done right away because our bill has to come to the floor this week.
STEPHANOPOULOS: How about on the spending side? Senator McConnell has said this. That the bill you're talking about right now doesn't mean your own test that the bill be timely, targeted and temporary.
PELOSI: First, let me just say this. We have a strategic vision for this legislation. Our economy is dark, darker, darkest almost. There isn't any economist who will give you an optimistic view of the direction our country is going. We have listened to their assessment of where we are. We have listened to what they have said about where jobs are created.
And from right to left they have told us that the investments that we make create more jobs than tax cuts.
Nonetheless, we have a package that has both. Heavier investments in terms of rebuilding in a green way, a new, innovative way our infrastructure. Addressing the unemployment, the needs of the unemployed in this economy, investing in education and health and reversing global warming. 95 percent of the American people, the great middle class, will get a tax cut in this legislation.
We also have some business taxes. Some of which were suggested by the Republicans.
So I would like to talk about what we are doing rather than - and be judged for what it can accomplish rather than criticized for what may not be in - by people who - it may still be in but we have to make an assessment about…
STEPHANOPOULOS: Let's talk about what's in the package, then. I know you don't agree completely with the Congressional Budget Office, this estimate, assessment.
PELOSI: Well, they're going to reassess it.
STEPHANOPOULOS: They're going to look at it. But what they've shown so far is that only about 40 percent of the discretionary spending, including the highway spending in the bill, is going to be spent right away in the next year and a half.
PELOSI: First of all, the congressional budget office only looked at 40 percent of the investments in the bill. By their own admission. So they didn't even take a complete look at the bill. We have a letter from the administration that says 75 percent of the investments will be paid out in the first 18 months.
STEPHANOPOULOS: And they're committed to that?
PELOSI: We're committed to that. And let me just this also. We have a lot riding on it. I don't want to have a legislation that is used to - as an engine for people to put on things that are not going to do what we are setting out to do which is to turn this economy around. I have the most to prove with this package, by the way, and I'm not - the choices we are making are those that will work, that must work. Our economy requires it. America's families need it. This is urgent.
STEPHANOPOULOS: We also heard from Congressman Boehner coming out of the meeting today that again a lot of that spending doesn't even meet the same test you just talked about right now.
Boehner : we have to find a package that is the right size
STEPHANOPOULOS: Hundreds of millions of dollars to expand family planning services. How is that stimulus?
PELOSI: Well, the family planning services reduce cost. They reduce cost. The states are in terrible fiscal budget crises now and part of what we do for children's health, education and some of those elements are to help the states meet their financial needs. One of those - one of the initiatives you mentioned, the contraception, will reduce costs to the states and to the federal government.
STEPHANOPOULOS: So no apologies for that?
PELOSI: No apologies. No. we have to deal with the consequences of the downturn in our economy. Food stamps, unemployment insurance, some of the initiatives you just mentioned. what the economists have told us from right to left. There is more bang for the buck, a term they use, by investing in food stamps and in unemployment insurance than in any tax cut.
Nonetheless, we are committed to the tax cuts because they do have a positive impact on the economy even though not as big as the investments.
STEPHANOPOULOS: The crisis in America's financial institutions is not abating, either. And administration officials have signaled that they might need billions more from the Congress to direct to the banks. Are you open to that?
PELOSI: I'm open to resolving the financial crisis in our country. Whatever we have to do will have to be clearly explained to Congress and to the American people as to what the purpose of the money is, why it is urgent, and then accountability for it as it is distributed. if they come back there's going to have to be a justification because people will be very, very disappointed in how his money was dealt with at first.
STEPHANOPOULOS: And many analysts have looked at it and said the only way to really deal with it, these banks are so close to insolvency, dealing with so many toxic assets, that the only way to deal with it fairly without giving a big boon to shareholders, is to have nationalization or partial nationalization of the banks.
PELOSI: Well, whatever you want to call it. There has to be - if we are going to put money into the banks we certainly want equity for the American people.
In other words, if we are strengthening them then the American people should get some of the upside of that strengthening. Some people call that nationalization. I'm not talking about total ownership but we're just saying.
Now how big that investment becomes is - would we have ever thought we would see the day when we'd be using that terminology? Nationalization of the banks.
You see the impact it has on the stock market. Just terrible in terms of the bank stocks going down. Because if you're a shareholder and you see what would be a dilution of your investment because now the federal government - if we're putting - if the taxpayer is putting money up, the taxpayer should have equity.
STEPHANOPOULOS: So it might be necessary?
PELOSI: Well, not by the terminology that you use but some increased investment. Change has to happen in terms of what is done, what the transparency of it is, what the accountability of it is. Only then would be able to pass any additional funding.
STEPHANOPOULOS: We also saw some change from President Obama this week in the way the United States is going to prosecute the war on terror, closing down Guantanamo. He says that's his goal.
your Republican colleagues here in the House say it is irresponsible to commit to that until you have figured out what to do with those detainees, especially that troubled group that is too dangerous to let go, but you may not be able to try them because of tainted evidence.
PELOSI: If you look very carefully at what President Obama did this week, it was really brilliant. That's why he was surrounded by so many people from our military, retirees who have our national security as their top priority -- as we all do. It's our first responsibility to protect the American people, as elected officials. And what the president puts forth was very wise. He said he's going to close Guantanamo, take the time to do it. You can't just go down there today and say, everybody out and lock the door. They're going to review the cases, narrow it down, and then go from there.
But it -- for those of us -- you know, I've spent a long time in the intelligence side of things in the Congress, I'm the longest-serving person, in fact, on the Intelligence Committee in the House. And it is -- it's brilliant.
STEPHANOPOULOS: I understand that's your judgment. Yet it creates the possibility, some fear, that detainees will be released in the United States.
PELOSI: I don't even know that that is a possibility. If a detainee -- using the standards that the president is putting forth, reviewing why they are there, how they got there in the first place, I think there is -- I know that there is provision for sending them home or to another country.
There are all kinds of options. But I think you have to take the first step to say, who are these people? Why are they here? Should they be freed and sent home? Should they be prosecuted? Do we not have enough evidence to prosecute them? And in what courts are they prosecuted, a military court, a civilian court?
So this plan is, I think, ingenious in what it does. Let's see how that works.
STEPHANOPOULOS: Congressman Bill Young of the Defense Appropriations Committee, Republican of Florida, suggested to Greg Craig, the White House counsel, that the detainees who can't be released should actually be housed at Alcatraz in your district.
PELOSI: Perhaps he has not visited Alcatraz. And let me say, Bill Young is a great member of Congress and I have a great deal of respect for his opinion. Alcatraz is a tourist attraction. It's a prison that is now sort of like a -- it's a national park.
STEPHANOPOULOS: Not a serious proposal.
PELOSI: It is -- no.
STEPHANOPOULOS: You're losing a member of caucus, Congresswoman Kirsten Gillibrand is going to be -- has been appointed by Governor Paterson of New York for the Senate seat.
Gillibrand: thank you governor for this tremendous honor
STEPHANOPOULOS: Yet it's no secret that you and she have not had the easiest relationship. And New York Democrats told us that you were urging Governor Paterson not to pick Congresswoman Gillibrand. And you actually made three calls to the governor, is that true?
PELOSI: I spoke to the governor, he called me. And then I returned his call and -- I don't know, I speak to him -- he's a friend of mine. I think he's a great governor of New York. And I think he made an excellent choice.
There is no...
STEPHANOPOULOS: So you weren't urging him not to...
PELOSI: Well, my concern...
STEPHANOPOULOS: ... Gillibrand?
PELOSI: ... as speaker of the House is of all the choices that he had, this is a district that is important to us. We worked very hard to win that seat. And so, of course, I want to keep my numbers here.
STEPHANOPOULOS: It's going to be tough to hold.
PELOSI: But what's important is -- well, we'll see. We'll see who the candidates are. We've only just found this out in the last 24 hours. But what's important is that he be elected governor and Kirsten be elected senator.
I don't have an uneasy relationship with Kirsten. I appointed her to the Steering Committee when she came here a very coveted position.
And now just recently, the past few weeks, named her to be head of our women's leave effort, again, much coveted by other members at the Democratic Congressional Campaign Committee.
So my concern is can they all be re-elected, can we win this seat. I was talking politics with him, about -- but she'll be a great senator. What I love about it is that as a mom, she has two little babies, two little children, and a young -- a working mom, she will speak to the aspirations of so many working moms in the country as she represents New York State so well.
STEPHANOPOULOS: How about Caroline Kennedy? Do you think she was treated fairly in this process?
PELOSI: Well, politics is a brutal business, it really is brutal. And once you put yourself out there as a possible candidate for an office, you know, you're in the arena, the fight begins. She is great, highly intelligent, has done so much for education in New York, written books on our Constitution which is the oath that we take here.
I think she would have been a great senator. But the fact is Governor Paterson had many excellent choices. Kirsten is the one who is Senator Gillibrand soon-to-be.
And we're -- all of her colleagues are very excited for her.
STEPHANOPOULOS: There is an article in The Washington Post about all of this, and it had a headline that caught my eyes. I was wondering what you thought about it. Does a glass ceiling persist in politics? And it quotes Donna Brazile in the article pointing out that less -- fewer than 20 percent of the House and the Senate are women.
She said: "The elevator to our future growth in Congress is still stuck in the lobby." Now you've broken though one big…
PELOSI: I broke through the marble ceiling, forget the glass ceiling. In this Congress, it's a marble ceiling. It's over 200 years of pecking order that was very all-male and predicted long into the future. So I broke into that.
It's interesting to me that that's not mentioned in the article. And when I became speaker, I've named women -- I just named Carolyn Maloney the chair of the Economic -- Joint Economic Committee.
Congresswoman -- well, a long list of women from New York...
STEPHANOPOULOS: So this wasn't about sexism?
PELOSI: Oh, in Caroline's case? Oh, I didn't see it that way. But again, I'm not in New York, I'm not on the ground. But yes, Donna is right, we need more women. At the rate we're going it's going to take too long to get parity. We have to have some breakthroughs. And we have. I always said it's harder to be speaker than be president of the United States.
STEPHANOPOULOS: And I was wondering how you felt, finally, as the first female speaker of the House on Tuesday, as you escorted the first African-American president up to the podium and saw 1.8 million people out on the Mall.
PELOSI: Well, I actually saw 2 million. It was pretty exciting.
Obama: We come to proclaim and end to the petty grievances and false promises, the recriminations and worn out dogmas
PELOSI: And as I sat there and listened to the speech, which I think is spectacular, the address...
STEPHANOPOULOS: It's tough.
PELOSI: I want everyone to study it. It's really a blueprint for the future. I was thinking of his mother, what a great person she must have been to have taken this extraordinary talent, this highly intelligent little boy and instilled the values and the discipline and the focus to become who he is, a person, and the great intellect, great vision, a strategic thinker, good judgment, and the eloquence, eloquence to lead a nation and to give people hope, I thought about his mother.
And also, as eloquent as he was, I told him, I said, you are eloquent, what was more eloquent to me was the silence of nearly 2 million people listening with rapt attention to what he had to say.
It was their attention and their silence, I thought that was very eloquent and bodes -- would bode well for the future.
STEPHANOPOULOS: Madam Speaker, thank you very much.
PELOSI: Thank you. A pleasure to see you again.