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MELISSA BLOCK, host:

This is ALL THINGS CONSIDERED from NPR News. I'm Melissa Block.

MICHELE NORRIS, host:

And I'm Michele Norris.

On Capitol Hill today, Goldman Sachs executives were in the spotlight as senators, Republicans and Democrats, grilled them on charges the financial giant misled its investors.

Meanwhile, Republicans continue to block debate on a financial regulation bill the White House has been supporting. And in a moment, we'll hear from Vice President Joe Biden on overhauling financial regulation, the economy and the anxiety of middle-class America. The vice president chairs a White House taskforce on the middle class.

Today, he and Treasury Secretary Timothy Geithner went to Milwaukee to hold a town meeting. And our colleague Robert Siegel caught up with the vice president there.

ROBERT SIEGEL, host:

The vice president's mission was to link the cause of tighter financial regulation to the problems of the middle class. Around half of all Americans identify themselves as middle class, and among them, polls show many feel their standard of living is slipping.

The audience today was an auditorium full of business students and teachers at the University of Wisconsin-Milwaukee. They heard the vice president argue that Wall Street schemers took advantage of a middle class whose earnings were stagnant and who could only borrow to achieve their aspirations. And they heard a defense who proposed new financial regulations as protection against another crisis. Mr. Biden says that bill means more transparency, and he said it means bigger capital requirements for banks.

Vice President JOE BIDEN: And finally, it means the power to break up big interconnected banks if they fail, without dragging down markets, without forcing the taxpayers to cover the losses. Never again should the government be faced with the choice of bailing out an irresponsible bank or watching the whole economy implode.

SIEGEL: The vice president and the Treasury secretary fielded several questions from the audience, and after the town meeting, the vice president sat down with me for an interview.

Vice President Biden, welcome to the program.

Vice Pres. BIDEN: It's great to be with you.

SIEGEL: First, I want to ask you about what might strike some as a disparity. Your talk about Wall Street was a very populist talk about Wall Street schemers and skyscrapers, taking advantage of middle-class people. And the remedies for this crisis don't seem to be so populist, they seem to be very carefully measured. You're not there to break up banks or ban credit default swaps. Is there some difference between the complaint and the remedy?

Vice Pres. BIDEN: Well, first of all, I disagree with the characterization as a populist speech. Most middle class didn't get taken by these credit default swaps and by these incredible derivative that they've come up with. They paid for the consequences of the market collapsing, bringing down the economy. And so what happened was that's how they lost their job, their factory closed, their unemployment rate went up, that's how they pay for it.

The fact of the matter is that I made a comparison to what happened in the '30s. The truth of the matter is the fundamental problem was the same back then lack of transparency, being overleveraged so you couldn't make up for your losses. And all this was was a 21st century version of this.

SIEGEL: But is there any remedy as dramatic as, say, the Glass-Steagall Act that separated commercial and investment banking, or are there remedies more modest this time?

Vice Pres. BIDEN: No, I think the remedies are as consequential, but there's a different economy. Glass-Steagall made a great deal of sense as a remedy for the woes of the 1930s. We have a very different economy today. We have a very different international economy today. And so the remedies put forward today, we think, are fully sufficient to regulate risk, actually, regulate risk with other people's money.

SIEGEL: You've made some forecasts of job growth that have led the White House spokesman to remind us that you're an optimistic man...

Vice Pres. BIDEN: That's right.

SIEGEL: ...talk about new jobs being created at the rate of a quarter million a month, soon half a million a month...

Vice Pres. BIDEN: No, that's not what I said. I said we will be creating jobs between 100 and 200,000 a month, but we will, at some periods in there, there will be an ebb and flow, create between 250 and 500,000. I think we'll hit a month where we will create as many as 500,000 jobs a month, but that's a long way to get to erase an eight million job deficit.

SIEGEL: Let me put the question this way: Do you have to get to that? Does the economy have to get to that level soon for your hopes for the American middle class to bear out?

Vice Pres. BIDEN: No. What has to happen is there has to be continued forward progress. There's going to be ebbs and flows. If it's three paces forward and one pace back, that's good, but it has to constantly be moving in the direction of job creation, number one.

Number two, no one is doubting right now that we're going to have continued projected growth on the GDP that is extended out, and that's already happening. My point is I am absolutely confident that the policies we put in place are sending the economy and the American public in the right direction. Of that, I am confident.

SIEGEL: I just want to ask you about one dilemma that a lot of Americans face if they're underwater on the house. They look at what may have been a rash financial decision to take the loan that they took. They look at big Wall Street institutions that managed to bet both ways on securities, or when they hit a deal that went sour feel nothing wrong in walking away from the deal. Some Americans now are just walking away from their homes. Do you see anything ethically wrong with that? Is it a reasonable financial decision that a middle-class family might make to say, forget it. We're in over our heads, goodbye.

Vice Pres. BIDEN: First of all, most of the people who ended up over their heads with a upside-down mortgage were not people who went out and got a subprime loan. They were people who lived in the neighborhood where a couple neighbors, on a block of 15 people, got subprime loans. They went bankrupt. They foreclosed on their house. Housing values plummeted. A lot of people just got trapped.

They were doing everything right. They never missed a mortgage payment. They never they borrowed against their house to send their kid to college, which was rational to do because they had an equity building, and all of a sudden it plummeted. And some people have no choice but to declare a bankruptcy. But at least, those people, quote, "who were walking away from their house" - God love them, as my mother used to say - they're paying a price, you know, but a lot of the Wall Street guys, they didn't pay a price.

SIEGEL: You mean their credit ratings (unintelligible)?

Vice Pres. BIDEN: Their credit rating, they go bankrupt. It have - very hard to get loans in the future, very hard to get back to the place they were, very hard to get in the same kind of house they were living in. And so they didn't it's not like they made a lateral move. Those people who walked away from the house moved from the house to a very small apartment or a rental property.

SIEGEL: Vice President Joseph Biden, thank you very much for talking with us.

Vice Pres. BIDEN: Thank you.

NORRIS: On tomorrow's show, we'll hear from some of the people who attended that event in Milwaukee. Robert asked them what they make of the challenges they face as members of the middle class.

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