'This Week' Transcript: VP-Elect Joe Biden

ByABC News
December 7, 2008, 1:27 PM


GEORGE STEPHANOPOULOS, ABC NEWS: Thanks very much for joining us.


STEPHANOPOULOS: There's so much to talk to you about, but let's begin with the news of the day. President Bush announced today that he's going to give a bridge loan to the auto industry, but they have to meet strict conditions by March or the money, billions of dollars, comes back to the Treasury. If they don't meet those conditions, will the Obama administration require the money to come back?

BIDEN: Well, we're going to do everything we can to help meet those conditions. Look, every stakeholder has to get in this deal. It's clear there's going to have to be some real sacrifices made. And when I say stakeholders, from the management to the parts suppliers, to the dealers to labor. And they're just going to have to do it.

They have to reach what the president, President Bush, referred to as viability. Roughly translated, in March, when they take a look at what it looks like, the next year they'd likely be able to meet payroll, they'd likely be able to sell enough automobiles, they'd likely to be able to float - keep themselves going.

STEPHANOPOULOS: But labor says they're being singled out for unfair conditions, and they're worried about -- UAW is worried about this provision that says their wages have to be equalized with foreign-owned companies. They want that change.

Does the Obama administration willing to change that part of the agreement?

BIDEN: Well, I'm not going to get into the specifics of what we're willing to change. I would just say one thing generically. Labor isn't the reason why the automobile companies are in the trouble they're in. Labor is going to have to make some additional sacrifices, and they know it and they understand it.

But the idea that -- every once in a while I turn on the television and I read $73 per hour and all that kind of thing. Well, that counts legacy costs, that counts costs that have built up over the past 40 years.

You know, it's a little bit misleading to imply -- it's been very bad decisions made about the type of automobiles, the way to market automobiles, the way to allocate costs that has been the overwhelming reason why the industry is in trouble. But labor, in order to save their own jobs, in order to save the prospect of an industry, is going to have to make some more sacrifices...

STEPHANOPOULOS: But they're saying they can't do it. Are you open to adjustments or not?

BIDEN: Well, it remains to be seen, George. We haven't seen the detail of it. It just got announced last Friday. I haven't had a chance to look at all the details, nor, to the best of my knowledge, has Barack, has the president-elect. And so -- but the bottom line here is all of the stakeholders are going to have to make some real sacrifices.

STEPHANOPOULOS: This is against the backdrop of an economy in deep trouble.

BIDEN: Exactly right.

STEPHANOPOULOS: And members of your transition have gone up to Capitol Hill this week and said that the economic rescue package has to be in the range of about $700 billion, it could go as high as $850 billion.

Why is a package of that size necessary?

BIDEN: Well, first of all, if you're referring to "The New York Times" article from Friday, it's not accurate. Parts of it are accurate; some parts are not.

STEPHANOPOULOS: Actually, on my own reporting, I've talked to several people on Capitol Hill who say that your team is talking about a package in the $700 billion range, it could rise. But in the $700 billion range.

BIDEN: Well, you're saying two different things. I sat for four hours with our team in Chicago last week, and what we're doing is putting together what we think will be the economic package that will do two things. One, stem the hemorrhage of the loss of jobs and begin to create new jobs, at the same time we provide continued liquidity for the financial markets.

This is like a scooter. You need two wheels in this scooter.

Up until now, all we've been focusing on is liquidity and what people -- average people talking about bailing out Wall Street, about making sure the banks have the money to lend and people are willing to borrow and lend and so on. That's one piece of it.

The piece we've been pushing for, Barack and I during the campaign, as you'll recall, is that we needed an economic recovery package we thought back in September, October, November. And we still think we really very badly need it.

STEPHANOPOULOS: But then you were talking about $150 billion, $200 billion.

BIDEN: We were. We were. We were.

STEPHANOPOULOS: So what have you learned? What exactly have you learned?

BIDEN: What have we learned? Is the economy is in much worse shape than we thought it was in. This is a spiraling effect, and what you're seeing now is a whole -- every economist that I've spoken to, George, from well-known economists on the right, conservative economists, to economists on the left and everyone in between, says the scope of this package has to be bold, it has to be big.

But here's how we look at it. Anything we put in this economic recovery plan has to be designed to create jobs, to stimulate the economy quickly, get jobs moving quickly. And it has to be for something that has a long-range impact on our economic health.

Case in point, we want to spend a fair amount of money investing in a new smart grid. That is, the ability to transmit across high-tension wires in the minds of most people in the public, or underground in these wires, wind and solar energy. You can't do that now.

That would create tens of thousands of new jobs, high-paying jobs. It needs to be done and it will have a long-range payoff not just for next year and the following year, keeping the economy from nose-diving, begin to turn the nose of that aircraft up, but it will also change our energy picture. It will deal with global warming.

They're the kind -- for example, weatherization. The biggest bang for the buck you can get right now to deal with global warming, but also create thousands of new, decent jobs, is weatherization, paying for everything from public buildings and schools, to homes to be weatherized. Save a lot of energy, create a lot of jobs. What we're not going to do is come up with make-work jobs.

And the second thing we're going to do, George, is that the president-elect meant what he said. That's why we came up with Mr. Orszag, who is a very...


BIDEN: The OMB director, with a very sharp pencil. We're going to go through that budget line by line by line, eliminating those things that aren't productive, eliminating those things that aren't really needed now. So we have to -- at the same time we're investing more in the economy that creates immediate stimulus to the economy, but with a long-range positive consequence for the economy, we have to at the same time we're doing that be cutting spending in other areas.

STEPHANOPOULOS: But how do you balance out the economic need for a big, bold package, several hundred billion dollars, some in the Congress have said you need $700 billion just to keep the unemployment rate from going up, with this concern about a deficit of a trillion dollars -- could go to a trillion dollars?

BIDEN: That's a really good point. That's really important. Look, the -- we're going to inherit a deficit that's probably going to exceed a Trillion dollars to begin with if we don't do anything, nothing at all.

If nothing happens between now and the time we take office on January the 20th, we're going to inherit the largest deficit in the history of the country's...

STEPHANOPOULOS: But then you almost double it with the rescue plan.

BIDEN: No. Now here's the second point. The second point is, what do you do, you know you have to infuse money into the system now. Every economist, as I've said, from conservative to liberal, acknowledges that direct government spending on a direct program now is the best way to infuse economic growth and create jobs.

The question is, are you going to create jobs that are just going to add to the deficit, or are the jobs you're creating, are they going to be doing a task that can draw down the deficit in out years?

Let me give you an example. You know, because we've talked -- you -- I know you know this area really well, I don't mean to sound condescending. You know that the Rand Corporation and other independent research groups have pointed out, if we were to put all medical records on electronic -- be able to be electronically transferred, we could save, they estimate, I think it's $78 billion a year.

But it cost money to put the entire medical industry in a position where they can put all of those records on an electronic basis. So we're going to invest money in what they call IT, this new technology, that's going to create jobs that are needed to make this transition.

The end result, though, the money we're spending, we're going to get back three- and four-fold.

STEPHANOPOULOS: But in the short run, at what point…