April 12 (Bloomberg) -- Senate Armed Services Committee Chairman Carl Levin, a Michigan Democrat, said in an interview on Bloomberg Television’s “Political Capital with Al Hunt,” airing this weekend, that the Chinese aren’t “doing what they can do and should do” to stop North Korea’s nuclear weapons program.
(This is not a legal transcript. Bloomberg LP cannot guarantee its accuracy.)
AL HUNT: We begin the show with Senate Armed Services Committee Chairman Carl Levin. Thank you for being with us, Mr. Chairman.
SENATOR CARL LEVIN: Great to be with you, Al.
HUNT: There are now reports that we believe North Korea may be near having a nuclear weapon that could be delivered by a -- by ballistic weapons. If that’s the case, everything we’ve done hasn’t worked. What should we be doing differently now?
LEVIN: Well, first of all, that’s the minority view in the intelligence community. It’s not the majority view. Secondly, if they do send the missile off, it’s not going to have a nuclear warhead. That would lead to their own destruction, and they only care about their own survival, so the North Korean leadership has one view only, and that’s their own survival.
HUNT: So you don’t think that’s a real threat, then?
LEVIN: I don’t think it’s a likely threat at all, but we’re prepared, in case they do aim a missile at us, we can defend against it, we can shoot it down, obviously, would not have a nuclear warhead. If it had a nuclear warhead on it and we shot it down, we would then act against North Korea just for trying.
HUNT: There’s a growing chorus in South Korea that they should be able to develop a nuclear capacity. Is that a good idea?
LEVIN: Well, no. We don’t want to have a nuclear peninsula. We want to stop North Korea from doing what they’re doing. And the key here is China. And China is the key to the solution in the Korean peninsula. They can stop North Korea from developing a missile which can carry a warhead.
HUNT: Are they being constructive now?
LEVIN: They are not doing what they can do and should do. And it’s been a real disappointment. And our relationship with China is an economic relationship. It is however -- when it comes to the security needs, mutual -- they don’t want North Korea to have a nuclear weapon. They don’t want North Korea probably to collapse, because of the immigration problem. But they are the key to the solution to the problem, and they are a real disappointment.
HUNT: Let me turn to a domestic issue. The president unveiled his latest budget proposal. Would you be willing to go along with the cuts he proposed in entitlements, Social Security and Medicare, if you could get a larger deal?
LEVIN: I’m willing to consider that, providing there is a larger deal which overall makes sense -- don’t want to commit myself to any part of a deal. However, the key for me is whether or not the Republicans will end their ideological rigidity on the question of revenues. And what my focus has been, as chairman of my Permanent Subcommittee on Investigations, has been these loopholes which allow the most-profitable corporations in America to avoid paying taxes by shipping their revenue.
HUNT: And that’s where you could get -- that’s where you could get the revenues?
LEVIN: A huge chunk of revenues could come from simply closing the loopholes, which, frankly, shouldn’t exist even if we had no deficit.
HUNT: Has the sequester really pinched military readiness yet? And if so, what are your Republican colleagues on Armed Services telling you about -- about any kind of a deal?
LEVIN: They are pinching. The sequester is pinching our military readiness. We’ve got a lot of evidence about it, how we’ve had our flying hours reduced and our other preparations reduced. But so far, it’s been surprising to me that the -- my Republican colleagues have basically gone along with sequestration, even though it has had that negative impact.
And when I say they’ve gone along, they’ve been so far unwilling to agree to a balanced resolution, balanced meeting, targeted spending cuts, not these across-the-board irrational cuts that hit everything, which is called sequestration, but targeted spending cuts, and additional revenues. They will not budge on the additional revenues even though, again, those revenues can come from areas which -- these loopholes which should be closed even if we had no deficit problem.
HUNT: Senator, you mentioned your investigations committee a moment ago. Do you foresee any possible criminal referrals coming out of the JPMorgan London Whale hearings you held last month?
LEVIN: There will be referrals. When you say criminal referrals, there will be referrals to the Justice Department and to the regulators, the Securities and Exchange Commission. That is a fairly routine thing which we usually do, and if hasn’t already been done, I expect it will be done. It is something which should be done. There is a huge body of evidence that should be reviewed by the people.
HUNT: Do you think any of this is criminal activity?
LEVIN: You know, that’s not my job, Al. And I’ve avoided reaching those kind of conclusions. I’m very disappointed, though, that there has not been action taken criminally against some of the higher-ups. I want to say that generically. In general, I want to make that comment, and not aiming it at a specific company, because that would really be going over the line of what I am appropriately.
HUNT: You’re saying specific company or specific individual, you mean?
LEVIN: Specific company or individual.
LEVIN: So when we make referrals -- and I expect that there will be, if they haven’t already been done in JPMorgan -- that they will then be reviewed by the appropriate reviewers, which are the Justice Department and the SEC.
HUNT: Do you see any more hearings that you would hold? And would you -- would you call Jamie Dimon?
LEVIN: We’re not -- probably not going to have additional hearings on JPMorgan. We’ve laid out such a powerful case of practices which are wrong, wrongful practices, and we’ve laid out hundreds of pages of what I consider to be wrongful practices that I don’t know that we can add much, frankly, to what we’ve already uncovered.
HUNT: Some of this is about corporate governance. You really looked into that carefully. There are a group of JPMorgan investors who say that Dimon should give up one of his two titles. You shouldn’t have a chairman and a CEO, the same person hold both posts in the interest of corporate governance. Do you think he should give up one of those posts?
LEVIN: If I were a stockholder in JPMorgan, I would want those posts to be split up.
HUNT: You would.
LEVIN: I would.
HUNT: And -- and would you want him to hold one of them if you were an investor?
LEVIN: I’d rather not comment on that. I mean, this isn’t a personal matter for me. This is a matter -- as you put it -- of corporate governance. I think it’s wiser, you’re going to get much more independent judgment, I think, if you split those posts up.
HUNT: Senator, let me ask you about another issue, drones. Has the administration provided Congress with the adequate legal justification and policy rationale for the massive use of drones, not just killing American citizens, but the overall policy?
LEVIN: We’ve -- excuse me -- we’ve seen the legal -- we’ve seen some of the legal justification, not all. Republicans -
HUNT: Shouldn’t you see all of it?
LEVIN: Yeah, sure, we should.
HUNT: And why don’t they provide it?
LEVIN: They have, I think, taken a position -- which previous presidents have -- which -- that the advice that’s given to the president by the counsel for the president is not appropriate for -
HUNT: Are you going to demand more information?
LEVIN: I’ve asked for it, but I don’t think we’ll succeed in any further demands. The key for me is that it be, No. 1, very, very carefully targeted to people who are targeting us. I mean, I don’t think we have to sit back and do nothing -
LEVIN: - when people are targeting us. The fact that people can have a safe haven and the prospect of people having a safe haven in Pakistan or in Yemen or wherever and plan and plot attacks on us should not be allowed to continue without a response from us.
HUNT: Chairman Levin, thank you very much. I know you’re stepping down at the end of this term, but you have 20 more very active months that we’ll be looking forward to talking to you again. Thank you.
LEVIN: Thank you, Al.
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