'This Week' Transcript: Sens. Leahy and Hatch

KRUGMAN: We've gotten significant wage cuts here. Now, it may not be enough. There's a problem, and this is certainly not a problem -- this is not something Obama wanted to do. But it was not conceivable to just let the thing collapse without doing something, without at least delaying the process. This is I think mostly about making things move enough in slow enough motion that we might have an economic recovery before everything goes.

STEPHANOPOULOS: And Jerry, the administration considers it I think a major victory that Chrysler, they believe, will be a viable company, they hope, when it comes out of bankruptcy.

But the difficult question, I think, on both Chrysler and GM is, OK, the government is in there now, but what everyone has to figure out is the exit strategy, and no one knows what that is.

SEIB: No, and John Dingell, the congressman from Michigan, who's been around forever, told me when this all came up, he said, you know, I was a bankruptcy lawyer once. People forget how hard it is to get out of bankruptcy. It is much easier to go in than it is to get out, regardless of what people say at the moment like this when it all starts.

So I think the exit strategy is the question here. I don't know what it is. I'm not sure anybody knows what it is. But I agree with Paul. I don't think Barack Obama wants to run auto companies, but that doesn't mean he's not going to be stuck doing it for a while. And I don't think he wants to tell the auto companies how to run their business, per se, but it's pretty clear he does want to use his influence to convince them they ought to be making a different kind of car.

STEPHANOPOULOS: And in fact, it was only -- he probably only got a deal, Gwen, because he was willing to put bankruptcy on the table in a real way. And I was struck by how much leeway Michigan politicians who supported him were giving him on this.

IFILL: Well, and also I was struck by his decision to really lash out against hedge funds, which is standing in front of a microphone with all of your economic team behind you, that's not a hard thing to do, I suppose. No one knows what hedge funds are and it sounds like an evil thing. So let's say it's a bad thing...

STEPHANOPOULOS: But four times, I'm not on their side.

IFILL: Because they weren't on his side. He had no choice but to put bankruptcy on the table. It's not like the president has had a wide array of choices here in trying to stop this. Their way of looking at it, there was not an option for failure for these auto companies, and so then, if you assume there's no option, you're not going to let them collapse, then what do you do?

WILL: It seems to me that the bankruptcy we sort of tried to prepackage in the administration before it goes to court is in the subjunctive mood. It will not be final until a judge speaks, and the president's proposing overturning certain premises of bankruptcy law.

Second, we talk about an exit strategy. Thirty years ago today, Margaret Thatcher won the election that made her prime minister, and we had the retreat of the state continue for almost 30 years. Now it's been reversed in a big way, and I'm not convinced that once the political class comes to relish the pleasures of having this enormous slush fund to intervene in the economy, turning bank loans into shares in the banks, et cetera, I'm not sure they're going to want to exit at all.

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