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December 13, 2007

Huckabee On "Money & Politics"

Bloomberg

PETER COOK: Hi, Betty, and good morning. On the Republican side of the presidential race, former Arkansas Governor Mike Huckabee has gone from afterthought to frontrunner in Iowa and he's surging in national polls as well. Mike Huckabee joins us now from Des Moines, Iowa to talk about his campaign, some issues important to business. Governor, good to see you again. Welcome back to Bloomberg.

GOVERNOR MIKE HUCKABEE: Thank you very much, Peter. Pleasure to be back.

MR. COOK: At yesterday's debate in Iowa, one of the challengers there called you the frontrunner. Are you in fact the man to be right now?

GOV. HUCKABEE: Well, I don't know if I even want to put myself there, but certainly, it's better than where I used to be. You're right. I've come from really the back of the pack - I think people are connecting with the message I'm talking about, changing our tax system. Eighty percent of the Americans are totally disgusted with it. That resonates with voters. And they want someone who's not a Washington insider, somebody who has actually been at a level of government that made it function and made it work and balanced the budget, things that families have to do, things that people want their president to do.

MR. COOK: There are a lot of business-related issues I want to get to in the course of our interview. Let's start with one of them now that's been in the news. The Bush administration last week announcing a deal with the mortgage industry to freeze interest rates for some sub-prime borrowers. It's been criticized by some for going too far. Others say it doesn't go far enough. Do you support this plan?

GOV. HUCKABEE: Well, it's better than have the taxpayers bail out people who made bad loans. The one thing I was so glad the Bush administration did not do is to say, okay, we're going to make it so that nobody has any harm. Look, this is a marketplace decision. People took some bad loans they shouldn't have taken. Lenders made some loans they shouldn't have done. It has to work itself out. I hope it's a lesson to people in the future; don't borrow if you can't pay it back. And it ought to be a lesson to the lenders: Be careful about loaning money to people that can't really give you your money back.

Now, the one problem with the plan - if it freezes banks from being able to foreclose, if this trend should continue, you really do create a chilling effect on the lending industry because who's going to want to lend money if they don't have the capacity to get their asset back if there's a default on the loan. So it's a tricky area, but I thought the Bush administration played it about as well as they could.

MR. COOK: So government intervention - it hasn't gone too far here in your view?

GOV. HUCKABEE: I don't think it's gone too far, but it's on the edge. I wouldn't push it any further and I sure wouldn't spend one dime of taxpayer money because if that happens, I think every American says, I'll go out and buy a Ferrari even though I can't pay for it. I'll let all of the other car owners pay for mine as they are paying for theirs. And that's not the way we ought to handle these fluctuations in the marketplace.

MR. COOK: Governor, you raised a few eyebrows in the business community by saying that the Republican Party should not become the wholly owned subsidiary of Wall Street. How much of the responsibility for the sub-prime mortgage mess falls to Wall Street, in your view?

GOV. HUCKABEE: Well, some of it does. You had many lenders who looked at the opportunity to kind of cash in on the vulnerability of people taking out loans, giving them teaser rates, getting them into the loan, knowing full well, if they'd really done a good study that these people weren't the kind of credit risk who could handle the long-term effect of a rising interest rate. And I think the loan companies have some culpability. They shouldn't be just completely let off the hook for that.

MR. COOK: Sir, does the law need to change? Does Congress need to change the law to prevent that kind of if you will predatory lending from taking place again? They are proposals up on the Hill right now.

GOV. HUCKABEE: The only thing that can make it worse is to get government involved in over-regulating. This is a market issue and I think, once again, I'm far more for less government regulation and the more the government gets in it, the more it gets messed up. So if Congress gets involved, all it's going to do is complicate it further, make it a more tangled mess. And that's the last thing we need right now.

MR. COOK: Some other questions right now related to the economy - if you were president right now, would Ben Bernanke be your first choice to run the Federal Reserve?

GOV. HUCKABEE: I'm being very careful not to start naming people in the cabinet and people that I would put on board at various positions. I need to get there first, but I'd try to get the best people possible, people who understood that we've got to have a free-market system. It's the best way to create jobs and to create the opportunity for people to get ahead.

MR. COOK: Do you think he's handled the economy appropriately since he took over as Fed chairman?

GOV. HUCKABEE: I think overall, he's done an excellent job. And it's not an easy one in this time when we have huge trade deficits, when we also have issues that come up like the sub-prime mortgage situation, which really I think created more panic in the marketplace than it did substantive change in terms of the economic structure.

MR. COOK: Are you worried about inheriting a recession if you are indeed the next president of the United States?

GOV. HUCKABEE: Well, I think every president has to be worried about the what-ifs. But I learned as a governor, you basically are hired to handle the what-ifs. That's the job. It's not the things you plan for; it's the things you don't plan for. That's when character and judgment come into play. It's not that hard a job just to take out the normal routine, cut the ribbons, make the speeches; you really get paid for handling the crises, the things that nobody saw coming. I did that as a governor for 10 and a half years. That's what a president has to do. And that's when you need someone with executive experience who knows that you don't have weeks to have committee meetings. You make a decision; you've got to pull the trigger on it and you've got to take action. And then you have to take responsibility for that action. That's why a president gets elected.

MR. COOK: Governor Huckabee, if we could, we're going to ask your patience, if you will. I'm going to toss you back to my colleague, Betty, in New York and we're going to continue our conversation. Betty, our viewers can see the rest of my interview with Governor Huckabee on "Money & Politics" later on this evening here on "Money & Politics."

(Pause.)

MR. COOK: Okay, Governor Huckabee, are you still there?

GOV. HUCKABEE: Yes, sir. All set.

MR. COOK: Great. Listen, thanks for your patience there and I'm just going to pick right up. And when our viewers see this this evening, they should see it without that interruption so again, I appreciate your patience and I'll just pick up from there.

If I could, I wanted to ask you about - Lorrie, we're all set? We're still rolling and everything? Good to go. Okay, just wanted to make sure.

So another business-related issue that's in the news this week and that's climate change. U.N. talks in Indonesia taking place right now. The U.S. is again resisting international calls for a set target to reduce greenhouse gas emissions. Is President Bush making a mistake here?

GOV. HUCKABEE: I think the United States needs to take some very serious and aggressive action to reduce greenhouse gases, but the concerns that I have of any international treaty is we don't want to give up American sovereignty; we don't want to agree to something that the other countries, particularly the polluting ones, are unwilling to do. So we should do it because it's right for our national interest, but we shouldn't capitulate to some international treaty if you don't have the Chinese and other countries who are also interested in making the same decision. I support cap and trade. I support increased CAFE standards. I think anything we can do to make our air, water, and soil cleaner and better for the next generation is just a matter of responsible stewardship. But we can do that as an American nation and set an example for the rest of the world, put pressure on them, but let's not ask of ourselves something that others are unwilling to even follow and respond to.

MR. COOK: So as president, you would support the notion of capping U.S. greenhouse gas emissions to a set target going forward in the future. And do you have in mind what that target might be?

GOV. HUCKABEE: Well, I think some of the proposals in Congress kind of get us there. It has to be something that also allows some reasonable limitations; you can't make this where it can't be done. You also have to make sure that we do it similar to the way we did that of acid rain. That was very effective in really curtailing the impact of acid rain. It didn't destroy America, destroy the economy; it actually improved the environment. Those are responsible kind of actions that are reasonable and acceptable.

MR. COOK: The U.S. is also holding economic talks with China this week as well. Would you take a harder line on trade issues with China than President Bush has?

GOV. HUCKABEE: I think I would, mainly because we've seen what happens when the Chinese dump products on us that have lead in the paint, that are unsafe. There is pet food and human food coming to us that hasn't been carefully inspected. We do have a $232 billion trade deficit with China and I understand that we need to have a good trading partner.

I believe in an open free-market system. And I'm a free-trader. I'm not a protectionist even though I've been accused of it, but I do believe that American interests have to be cared for. And that means that you don't allow your trading partner not to live up to the WTO standards when we're expected to. Everybody ought to play by the same rules. Otherwise, you don't have a fair game and the outcome can't be even judged legitimate.

MR. COOK: Is it appropriate right now for Congress to pass trade-sanction legislation against China for not allowing, for example, its currency to move more freely? There are several proposals, bipartisan proposals, up on the Hill right now.

GOV. HUCKABEE: I think we do need to be concerned. I haven't weighed in yet on just exactly where Congress may be going on this, but let's be - all I think on the same page, that there is some danger in China having an enormous level of our currency. That means they have the capacity to manipulate it. I think we're kidding ourselves if we think the Chinese wake up every day saying, gee, what's good for America? No they don't. And we're naïve and we're foolish if we think that they're looking after our best interest.

The United States better look after its best interest because there are a lot of jobs and a lot of American families that depend on the American government being more concerned about our future than hoping that the Chinese are concerned about it.

MR. COOK: Immigration, another big issue to the business community, a big issue to voters there in Iowa as we've seen in polling - this week, you unveiled your own ideas on immigration, including a plan that requires anyone in the country illegally to return home first before giving a possible path to citizenship. Is that really going to work? Aren't there a lot of illegals who simply won't step forward if they face the prospect of this touch-back provision?

GOV. HUCKABEE: Well, here's the thing: Everyone living in this country ought to be able to live with their heads held up not down. Nobody ought to be in fear and hiding to be in the United States. The plan that we call for says they go back, they start at the back of the line, not the front. So you get rid of amnesty, take that off of the table. You have secure borders. But all of this is predicated upon the United States government having a modernized system that doesn't take eight years of paperwork to get a permit to come pick lettuce.

Let's face it. The real problem here is not that people want to come to America. Heck, I'd want to come here too if I lived anywhere else on Earth. The problem is a dysfunctional, incompetent government that's never modernized this process and now have people feeling the only way that they can survive is to break the law and cross borders. Secure those borders, create a real system that puts the people who have been standing in line legally first. The others would come in after them. It can be done. You can get a credit-card application processed virtually overnight and certainly within a few days. And if our government is so incompetent that it can't do it, then we'll outsource the process to American Express because I'm pretty sure they could make it work.

MR. COOK: So for those who suggest this tougher line on immigration, this new proposal is at odds with your past statements on this topic. How would you respond to that?

GOV. HUCKABEE: No, it's not. It's actually in keeping with it. I've always believed that what we need to do is have compassion for the people, be angry at the government, not at the people who want to come here. I say every day, we ought to get on our knees and thank God we are still in a country people are trying to break into, not one they're trying to break out of. My point is that it's real compassion to say, let's get people who are here to be able to live with their heads held high, not to live in fear and hiding.

Living in fear in America to me is an oxymoron. How in the world can we ever say that America, a land of freedom, is a place where people are scared to death of the government? No, we ought to make it so that when people do come here, they've done it legally. It's in their best interest; it's in our best interest. Everybody wins and nobody loses when we make sure that the pathway to get here is a legal pathway.

MR. COOK: We've talked about taxes in the past and I know about your support for the FairTax. The idea of a national consumption tax certainly would be a dramatic change and one that would be very difficult to get through Congress; it could take years, even if you were successful. In the meantime, if you were president, would you extend the Bush tax cuts and are there other tax changes that you would consider as president, perhaps tax reductions?

GOV. HUCKABEE: Absolutely. Not only would I want to extend the Bush tax cuts, which have been very helpful in reviving the economy, but we really do need to start giving full tax deductibility for healthcare, to put more people where they can afford healthcare, not make it employee-tied or employer-tied, but rather to the employee. I would try to cut capital gains taxes. Of course, under the FairTax proposal, we get rid of capital gains and income tax. We get rid of all of the taxes on our productivity. That's counterintuitive to healthy economy, to tax people for doing well.

Look, we need a tax code that doesn't make rich people poor, but that helps make it possible for poor people to get rich. That's what America ought to be trying to with it's tax system. That's not what our current tax code does. That's why 80 percent of the American population hates this tax system and wants something dramatically different. That's why I support the FairTax, which gets us there.

MR. COOK: Would you consider any tax increases to try and save Social Security and Medicare?

GOV. HUCKABEE: It's not necessary. We don't need more taxes; we need better control on spending. We need to be able to make sure that what we are spending money on is reasonable. And if we want to stimulate the economy, you don't just go out and raise taxes at the federal level. You do everything you can to better manage what you have. You try to put more money into the private sector so there's investment and there's really the kind of job creation that results in, ultimately, more money for both the government as well as for the private sector.

MR. COOK: Sir, really quickly, let me finish up on some political questions. Some people suggest you are the frontrunner now in Iowa, but that you don't have the same kind of support in New Hampshire. Maybe this is one state and done for Mike Huckabee. Are they wrong?

GOV. HUCKABEE: Well, look at the national polls. I'm either number one or number two in every national poll that's come out, whether it's USA Today, Gallup, CBS, CNN, Time. I mean, take a look at any national poll. This isn't just an Iowa thing; this is across the country. People are realizing that they have a choice. And that choice is for somebody who's actually managed a government, who's not from Washington, who represents real change, not just talking about it. And I think what you're seeing is not just a sort of a flash in the pan, it's a true movement. It's catching fire and it's caught a lot of people off guard, but frankly, I don't think it's caught a lot of ordinary Americans off guard because they want a president who struggled to get where he is. And they know that if a guy like me makes it, it's proof positive that they can, too. That's one of the reasons that our campaign has really caught fire.

MR. COOK: Your campaign was on a shoestring early on raising money. Have you had more success recently? Can you give us some sense of how much money is pouring into your coffers as a result of the surge in the polls?

GOV. HUCKABEE: Well, it's made a dramatic difference. Where we were raising $20,000 at fundraisers, we're seeing $200,000 fundraisers. We raised more money in one month, in November, than we had raised in all of the 10 months previous to that combined. Before that, people said, we like you, like your message, just not sure you can win. And now there are a lot of people who are saying, gosh, not only could he win, I think he might. We'd better send a check. So we hope they continue to do it in big numbers.

MR. COOK: Got any dollar amount you can share with us where you stand right now?

GOV. HUCKABEE: No, but it's a whole lot better than it was. And we're on television now in South Carolina, New Hampshire, and Iowa and plan to be competitive right through the time that we get the nomination and go on to take the White House. So, you know, people keep saying, gee, how much money have you raised? Well, the truth is, a whole lot less than the guys that are behind me. So somehow it's working. So if my choice is having more money and being behind or having less money and being ahead, I'll take less money and go ahead any day and win the thing.

MR. COOK: Sir, final question if I could. I've got to ask you about this New York Times magazine story, this reference to the Mormon religion in a discussion with the reporter there. You said, "Don't Mormons believe that Jesus and the devil are brothers?" You asked that question of a reporter. You've already said that you apologize for Mitt Romney about that comment. Where were you going with this comment and is it reasonable for people to question how an ordained minister would ask this kind of question?

GOV. HUCKABEE: No, because I don't know that much about the Mormon faith. I haven't studied Mormonism. I have enough trouble keeping up with Baptist theology. I'm a Baptist. The reporter actually knew more about the Mormon faith than I did. It was a question that was asked, 10 words, in the context of about a three- to four-hour conversation that we had over a period of several days. Somehow, 10 words got lifted out of an 8,100-word article and it's unfortunate. I'm not, you know, talking about somebody else's faith. It's not my job to discuss it.

MR. COOK: Governor Huckabee, we wish you well on the campaign trail. Thanks very much for joining us here on Bloomberg. We do appreciate it.

GOV. HUCKABEE: Thank you, Peter.

MR. COOK: Sir, love to get you back in D.C. the next time you roll through, but I think you're going to be busy in a few other states in between now and then.

GOV. HUCKABEE: Okay, probably so.

MR. COOK: So we extend the invitation any time you're in town.

GOV. HUCKABEE: Okay, Peter, thank you.

(END)

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