Transcript: Sens. Chuck Schumer and John Cornyn

STEPHANOPOULOS: But isn't what's different here now is the government's on both sides of the negotiating table? They have so much power because they have such a large share?

(CROSSTALK)

GILLESPIE: Look at the recent history. I mean, it hasn't in the past been very historically easy to get the auto companies to agree to an increase in the CAFE. We just went up to 39 miles per gallon. It was very easy this time for President Obama to bring the auto companies in, for them to agree to that, because there's no leverage here.

And I do worry, I think one of the broader threats to our economy is, if you're going to supplant profit motive with political motives, over time, we're going to have a much bigger drag on our economy. The government is not the most efficient allocator of resources in the American economy.

STEPHANOPOULOS: And that's the biggest dilemma facing the administration, because you know, let's say GM has a plant in Cocomo, Indiana. They say they want to move it to Buenos Aires. They say they want to stay out of it. Will they be able to?

GREENBURG: Right, I mean, going back to your point and Gwen's point, you know, are you going to outsource your manufacturing or parts to South Korea or China, or are you going to mandate that it be kept here? How is the government, you know, when it's controlling these companies, is going to make those decisions, when it's kind of weighing now, I mean, very competing interests in a political fight.

(CROSSTALK)

WILL: One of the government's recent interventions in industrial policy is the ethanol industry. Now, the government, when it said we're going to put all this corn in our gas tanks, did not intend to cause food riots in Mexico, but it did.

KRUGMAN: This is a -- I've often said, if only the first caucuses were in New Jersey instead of in Iowa.

(LAUGHTER)

Then we'd have some -- someone would require you to put diners in your cars or something, but...

(LAUGHTER)

But, no, look, this -- but, you know, they're very aware of this. is -- none of this would be happening if it wasn't taking place in the middle of the worst economic funk since the Great Depression. Very exceptional things happened. They're not indicative of where policy is going to be for the next 20 years.

GILLESPIE: I -- think that's a -- that's a legitimate point relative to the auto industry and the intervention here, obviously. But, look, this is going on a number of different fronts: the health care debate that's going on, right now, and the public option, a huge intervention, again, into one of the biggest sectors of our economy.

KRUGMAN: The public option is about offering people a choice. I mean, if people who are opposed to...

(CROSSTALK)

GILLESPIE: In the same way that autos were offered a choice and the bond holders were offered a choice.

(CROSSTALK)

KRUGMAN: It's nothing like it. And it's...

WILL: Paul assumes that, once the political class gets a taste for using American capital, broadly speaking, as a slush fund to buy political advantage, it will forswear doing so in the future. I don't believe it. Paul, most of the -- most of the agriculture policies in this country are residues of those put in place for the Depression emergency. New York City lives under rent controls put in place for the emergency of the Second World War. The Japanese have surrendered. They go right on forever.

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