'This Week' Transcript: Stimulus Debate

WATERS: Well, George, as you know, the word "nationalization" scares the hell out of people. And so the debate has been opened up now, and that's good. Let's talk about it.

We know that, as we have this capital infusion into these banks, we're owning more and more of them. Citibank is probably almost nationalized with the amount of money that we've put in it. But I don't think that we are ready to move to the point of a formalized nationalized banking program yet.

STEPHANOPOULOS: Even if it's the only thing that will work?

WATERS: Well, we may get to that point. And I'm not opposed to that. But I think the discussion is just opening up. This is new for America.

KING: Yes, I think this is probably going to slow down the tempo of your show. I think this is some place where we really should try to work together. I actually worked with Chuck on TARP I.

SCHUMER: We did.

KING: This is a very, very critical issue. And so let's see what Geithner is going to propose. I wish he had been a little more specific this week. But, you know, I assume that's going to come out soon. And we really have to...

STEPHANOPOULOS: But as you learned more about what he proposed, were you more comfortable with it?

KING: I'm comfortable with Geithner. I know he didn't pay his taxes; I know all those issues. But the fact is, he is a very smart guy. He understands the issues. And I'm willing to give him the benefit of the doubt upfront to at least get the debate going and get it on the table.

GRAHAM: The -- the reason I did vote for him is because I -- I talked with Chuck and Pete. He has a good reputation, I think, as a smart guy.

I think if you put most of our major banks under a stress test, they're going to fail. And this idea...

STEPHANOPOULOS: And this stress test is starting this week.

GRAHAM: Yes, this idea of nationalizing banks is not comfortable, but I think we have gotten so many toxic assets spread throughout the banking and financial community throughout the world that we're going to have to do something that no one ever envisioned a year ago, no one likes, but, to me, banking and housing are the root cause of this problem. And I'm very much afraid that any program to salvage the bank is going to require the government...

STEPHANOPOULOS: So what would you do now?

GRAHAM: I -- I would not take off the idea of nationalizing the banks.

WATERS: We've come a long way...

SCHUMER: Let me just say this. George Bush, a very conservative president, had more government intervention in the financial system than any president in history. But I would not be for nationalizing. I think government's not good at making these decisions as to who gets loans and how this happens.

I think the Geithner plan, despite the fact that the market was disappointed it didn't have details -- and I think that was just bad signaling -- is a very good plan. And I think, when the details are learned...

(CROSSTALK)

STEPHANOPOULOS: Explain why.

SCHUMER: I'm going to explain why. When the details are learned, people are going to like it. First, it's bold and big. This idea of dying a death of 1,000 cuts -- this bank is in trouble, we deal with that, this company is in trouble -- no. You saw headlines in newspapers, $2.5 trillion when you add in the Fed and everything else, even though it's only using the TARP money that we have.

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