Transcripts For CNBC The Kudlow Report 20130108

Get ready to rumble, america. The First Political battle of 2013 is on. It starts in washington. Where today president obama for some reason went ahead with his decision to nominate chuck hagel for secretary of defense. Hagels a republican, but hes been accused of antisemitism toward israel and hes also soft on iran. And epa regulatory menace lisa jackson finally resigning because president obama apparently will approve the Keystone Pipeline. Thats the latest from a number of sources. And i say good riddance to her, but good for the Keystone Pipeline. Here is a disgraceful story tonight. New reports that welfare cash is being spent on strippers, booze, and important shows. Whatever happened to work requirements. And the battle everyones waiting for in miami tonight, notre dame looks to win the National Championship over obama. But in one way, the fighting irish may have already won. And last but not least, im going to tell you why i think a debt ceiling and Government Shutdown, bad idea. Im going to show you a better way. The kudlow report begins right now. First up, amid allegations of antisemitism and antiisrael sentiments, president obama nonetheless nominated former republican senator chuck hagel for the position of secretary of defense. That today, also reportedly soft on iranian sanctions. So is there any truth to these charges . Here to discuss eliot abrams, a senior fellow at the council on foreign relations. Eliot, happy new year and as always, welcome back. Are these charges is there merit to these charges . First of all, antisemitism. Look, i cant read his mind. I can only go by the Public Record. The Public Record suggests hes got a problem with jews, frankly. Theres reports from the members of the tiny nebraska Jewish Community that they never had a politician in nebraska who was so indifferent, their word, indifferent to the community. Who took no interest, who was completely nonresponsive to any requests they made. Theres a beginning. Then you have these quotations of his. The jews this and the jews that. There was a story when he was president of uso trying to close the uso site in a port that a lot of u. S. Navy ships were visiting. A Jewish Organization came to argue with him it should be kept open. He said, apparently, well, let the jews pay for it. Theres a pattern here. Any one of these things taken alone isnt much, but you start putting this together. He does an interview a couple of years ago where he says im the United States senator, i took an oath to our constitution, not to israel. Well, who was he saying that to . Thats an incredible slap, eliot. Yeah. I read with great interest your rendition of the story. That was an usa operation working very, very well with an israeli leader and israeli general or Something Like that which he closed down. But this thing what you just said now, can you repeat that . Because nobody talks like that nowadays. Nobody talks like that. Right. This was an interview he did a couple of years ago where he said this is the one where he used the term jewish lobby. But he also said, you know, im a United States senator, im not an israeli senator and i took an oath to pour constitution. One of the problems if the senate says okay to this is what its saying okay to really is a new level of antijewish rhetoric. This is something we had driven out of public life. You can disagree about policy with respect to israel, but thats a challenge of dual loyalty. And from what i gather, senators like Chuck Schumer and menendez and other democrats, eliot may vote against them. Well, theyre certainly holding up to see what he says a the the hearings. One of the questions well have to decide at the hearings or they will have to decide when they vote. If he recants on all of this, can you take it seriously . Its like the statement you made about, you know, sort of turned around on gay rights. He had 15 years to turn around, he does it the week when hes up for secretary of defense. So you have to ask yourself, if he now says, oh, i was misquoted and i didnt do this and i didnt mean that and im sorry if anyone took offense, how seriously do you take that those kind of recantations a the the last minute. And one last one, eliot abrams. He voted against or he was against iranian sanctions when he was in the senate. What does that tell you about how hes going to deal with iran now . It sounds like a soft position to me. He voted against the iran libya sanctions act in 2001. I think the real problem here is that the message to iran is you dont have to make any deals, you dont have to make any compromises because there wont be any military pressure. The president used a lot of tough language during the campaign. Im not for containment. He said im for prevention. All options are on the table. But hagel has said that a military option is not viable. Never mind not wise, not viable. So i think this completely undercuts any notion that iran is under pressure. It oddly enough makes it probably more likely that there will in the end be a failure of negotiations and a military attack. But he doesnt seem to support the president s policy, at least in all the speeches hagel has made, he has been very soft on iran. All right. Well leave it there. Former secretary of state National Security council eliot abrams, thank you very much. All right. Now to react to ambassador abrams, lets bring in our distinguished panel tonight. We welcome back general wesly clark and a former president ial candidate, cnbc contributor tony fratto, former bush 42 White House Deputy press secretary. Welcome back. First of all, whats your reaction to eliot abrams charge, in particular, the antisemitism and the antiisrael . You know, i just dont see that. Ive been around senator hagel when i was on active duty. We talked about a number of National Security issues. Hes been there presiding and on the panel when ive testified. Ive had informal reactions with him. I never sensed any of that. I sense a guy who has paid the price for serving in uniform. He served his country, knows what its like to be wounded. Knows what its like to have members of your family in the service and hes had a generation to reflect on the experiences of vietnam. I think hes going to be a guy who knows how to use force decisively and effectively and avoids ineffective and indecisive commitments of u. S. Forces. Well, certainly no one including myself doubts his valor as a soldier. Thats not the issue. But tony fratto, it sounds like hes also soft on iran. He voted against iranian sanctions, that in turn makes me think or wonder or fear that, in fact, he would not put war on the table if iran got nuclear weapons. Your take . Yeah, i think thats really the bigger question, larry. A lot of questions about some of the things that hagel has said over the course of his career i dont know him wouldnt presume to make a comment on what his views are on the Jewish Community. He has well earned a reputation for saying a lot of things to get attention. Some of those things purely critical of his own party. Which is one of the ways to unlock, you know, the key to unlock the way to become a media darling in washington is to be critical of your own party. His views on purely defense issues are really the questions that matter most and shouldnt matter most right now. Questions on preparation and force towards iran are really the critical questions. And the critical questions for the Armed Services committee to get out when he comes up for his hearings. Some people are speculating. Of course, obama likes them, thats one part. Obama likes them, they serve in the senate together. I have no problem with that. Others are speculating that mr. Hagels going to the Defense Department and take a budget axe into the budget. A staunch defender of the budget. Thinks the cuts are way too much. Is that why hagels going in there . Hes going to slam, slash and knock down the Defense Budget . No, i think the opposites the case. I think you cant have anybody thats going to be more sympathetic to the men and women in uniform and the defense needs of the country than chuck hagel, hes worn the uniform, hes been there, hes going to be an effective defender. I would say this on the sanctions issue, though, as ive discussed with his people, he never had an objection of multilateral sanctions. But hes had an objection to unilateral u. S. Sanctions because he doesnt think theyre effective. And he wanted the administration to not just take a political position and say okay were sanctioning, but actually show the International Leadership in the International Community to bring collective sanctions. And thats precisely what the Obama Administration has done. Quite effectively. The problem with that, general, is it was a bilateral sanctions put us in a position to be able to get unilateral sanctions. A lot of sanctions started as bilateral sanctions led by the United States, work that the u. S. Treasury department did. And to extend those to countries and firms operating in other countries. This is theion with hagels actually his question of judgment on some of these things. Do i think, you know, is hagel, youre not going to hear me calling him soft on iran or soft on, you know, questions regarding israel. Look at very specific issues that he has had to weigh in on and hes just been wrong on some very big questions, including the surge in afghanistan and the surge in iraq. I think that when you look at the sanctions, for example, i dont think its a problem he voted toward unilateral u. S. Sanctions. Sanctions dont have to start out as unilateral. Thats a decision of the administration and a function of their leadership. The Bush Administration didnt have the leadership in the international and didnt put the effort into it. We actually did. That was actually how excuse me. Can i just sorry, general. I want to finish this part. I think its very important that you have a secretary of defense come who appreciates the need to get our allies into the boat with us. Thats what chuck hagel appreciates. But thats exactly the point im making, though. Bilateral sanctions was a way to get to multilateral sanctions, the only way that going to get the europeans to eventually go along. I have to leave it there. My point is i dont think that is the only way. And i think when you look at the way the United States is handling itself now, you could say theres not an only way to do this. And thats the point chuck hagel was trying to make. Theres not an only way. That doesnt mean its the only way to do it. Ive got to leave it there. I think there are so many questions that will come out in these hearings about his positions relative to iran, relative to israel, and relative to budget cutting in the department of defense which i think is going to be a tough one. Many thanks, appreciate. As always, tony, please hang tight, well be seeing you more of you later this hour. Now, lets switch gears and turn to the stock market. Coming off last fridays fiveyear high, the dow and s p dropped a little bit today. But heres a thought experiment. Follow me on this. Take washington out of the equation, just take it out, i think youll see the economy and the market Getting Better not worse. Here now chief equity strategist at ubs. They will make a deal on sequestration. They will not default on u. S. Bonds. Its that simple. I said weeks and weeks ago they would extend the tax cuts and they have. If you take that out, is it the economy looking a little better at the margins, not worse . Its looking a little better if you think a 2 economy is a good economy. So the real question here and i feel like im going to sound like larry kudlow for a second, wheng we get through the debt ceiling debate, is there something that feels like a progrowth agenda . Are we going to have the issues under control . Is it enough to get businesses confident in the future . And i think when we get through this, well be left with a 2 economy, 4 earnings growth, and its going to be okay, but uninspiring. 4 , 5 earnings growth, plus 2 for dividends, thats not a bad year for the s p. Itll get you to 1,550 . We are in a mid single digit equities environment. Its not horrible as long as youre not expecting something thats, you know, thats 10 . Look at some of these releases. Im very impressed with the isms for services. Very impressed with capital goods, factory order spending, factories isms, even the employment report showed good hours worked in income. Are we underestimating the economy . Forget washington, put that aside. Are you underestimating the economy . Itll be 3 instead of 2 . It could be. Lets put it this way. If you look, for example, at the cbo budget numbers, they are looking for this thing to get to 3 , 4 , 5 , over the next two or three years, i think those are silly numbers. Could we be in the high twos . Not without a question. Especially if you can unlock this lack of Business Confidence thats out there, that to me is the most important. I love the fact that gold is falling almost on a daily basis. Because when gold falls, people are investing in more productive assets. Reminds me of the 80s and 90s. You know, youre stiealing m script on gold. Its a nonproductive use of their capital. Thats a really bad thing for the economy. Its a great sign. Look at what corporations doing. Theyre not doing mergers, not investing in the infrastructure, theyre not doing theyre not paying out, you know, buy backs are actually stalling out and would be midcycle levels. If you unleash that, thats your upside. There is upside here, but and, and, and okay. I would say maybe we might move in washington down the road. Im bringing back my own experience to Corporate Tax reform that will lower business tax rates for large and small businesses. Is that possible . Its possible, and if you know, listen, thats what you really need. If you can get youre talking about the things that could unleash this. Things which create confidence in the future. Lowering Corporate Tax rates which get capital flow into the United States, thats a huge positive. If you unlock overseas cash, thats a positive. But you need to convince businesses theres something to look forward to and spend the money. Very, very good point. Very, very good point. Jonathan, thank you very much. We had a good thought experiment. Now, does this look like a place we should be spending our tax money . A new report says welfare recipients in new york routinely use atms at strip clubs, bars, even Liquor Stores and spend the money right on the premises. We are goinging to look at this disgraceful story next up. And, yep, notre dame, the home of touchdown jesus, but did you also know its the home for successful mix of academic and athletic folks . The fighting irish about to play for the National Championship for the First Time Since 1988 against a very good alabama team. And dont forget, folks, free market capitalism is the best path to prosperity. Notre dame and alabama, im kudlow, well be right back. So if you have a flat tire, dead battery, need a tow or lock your keys in the car, geicos emergency roadside assistance is there 24 7. Oh dear, i got a flat tire. Hmmm. Uh. Yeah, can you find a take where its a bit more dramatic on that last line, yeah . Yeah i got it right here. Someone help me i have a flat tire well its good. Good for me. What do you think . Geico. Fifteen minutes could save you fifteen percent or more on car insurance. Impact wool exports from new zealand, textile production in spain, and the use of medical technology in the u. S. . At t. Rowe price, we understand the connections of a complex, global economy. Its just one reason over 75 of our mutual funds beat their 10year lipper average. T. Rowe price. Invest with confidence. Request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. All right. Here is a disgraceful story, the New York Post reports today that welfare recipients used Electronic Bank transfer cards to take out cash for strip clubs, Liquor Stores and xrated shops. This is a disgrace. Here now is bestselling author, syndicated radio talk show host larry elder, author of dear father, dear son. I thought welfare was for safety nets with strict work requirements. Whats going on here . Well, larry, put me firmly on the side of antiusing your Welfare Benefits for strip clubs. But the real problem here is the 800pound elephant in the room. And that is the poorly performing economy. Why are so many people on welfare . George w. Bushs last year, right now were talking about 100 billion on food stamps. And the offenders of obama remind me of the losing coach who blame, first of all, the team he inherited and then blames injuries, then the media, then the schedule. Sooner or later, you are what your record says you are. Were entering the fourth year of this socalled economic recovery, the fifth year of his presidency and we are underperforming. Thats what the issue is, larry. Thats bad enough. And i basically agree with that, okay. Underperforming economy. But the perversion of this welfare program, it mean years ago we had welfare reform with strict work requirements. Now, as the New York Post is reporting, the money is going into liquor and strip clubs. And a lot of people, theres a lot of rumors that food stamps are being exchanged for cash and people are abusing that program just as much. This is corruption on a grand government dependency scale, is it not . Well, it certainly is. And the welfare reform act of 1996 was spectacularly successful. And thats really the scandal here. And again, larry, we always have waste, fraud, and abuse whenever you have a government program, inherently you have inefficiencies. That raises another question about whether or not it would be better for us to deliver the services for the poor through private sector whether then through government charity, especially at the federal level. One of the great books in america was democracy in america and he talked about the fact that we had all this charity in this country. Weve gotten away from that, larry. And its inefficient, one, and secondly, less likely to change behavior for the good if its done by the government checked by some bureaucrat who doesnt know who you are. I understand the reference, i understand the charitable reference and so forth. Churches used to do that very well. And whatever. But walk me through that. Is there a way to deliver these government benefits from washington that would make them more efficient . Did you would you, for example, trust states to do it . Would you, for example, trust cities to do it . I mean, somebody has got to police this kind of corruption. Welfare money from taxpayers going to strip clubs, this is not what the intention of that program was. Well, first of all, welfare should never have been at the federal government in the first place. And youll find all sorts of records including James Madison turning down refugee bills for indians saying it is not consistent with the constitution for it to be done at the federal level. It shouldnt be done at the federal level at all. But when you look at benefits, whats the best way of delivering them . I volunteered for one summer, larry, at united way, you donate a dollar to united way, 90 cents gets down to the beneficiary. Right now were spending up to 60,000 and if you add up the value, we could write a check to every family on welfare for 60,000, but its inefficient because of government salaries and bureaucracies and so forth. The private sector relies on volunteers. Thats why its far more efficient. 1871, the city of chicago burned down, it was rebuilt with almost complete private money. They came in from all over the world. It was handled with some government bureaucrat, but by and large, the whole city was rebuilt with private money. It can be done without government. It could be done without government. You know what . It would be a heck of a free market experiment. It would also be a great socially compassionate experiment too. Anyway, larry elder, as always, thanks very much. Now, to my very strong warning to politicians in washington, d. C. Its a strong warning. Please, dont shut down the government, dont shut down the debt ceiling, i have a much better way to do it. Listen to this. Its really tough stuff to have a partial Government Shutdown and pay interest on the debt and the internal obligations. No, and thats why i loved having you on the show. Nothing but the facts. [ female announcer ] today, jason is here to volunteer to help those in need. When a twinge of back pain surprises him. Morning starts in high spirits, but theres a growing pain in his lower back. As lines grow longer, his pain continues to linger. But after a long day of helping others, he gets some helpful advice. Just two aleve have the strength to keep back pain away all day. Today, jason chose aleve. Just two pills for all day pain relief. Try aleve d for strong, all day long sinus and headache relief. Ive always had to keep my eye on her. But, i didnt always watch out for myself. With so much noise about health care. I tuned it all out. With unitedhealthcare, i get information that matters. My individual health profile. Not random statistics. They even reward me for addressing my health risks. So im doing fine. But shes still going to give me a heart attack. Were more than 78,000 people looking out for more than 70 million americans. Thats health in numbers. Unitedhealthcare. All right. Heres some good news for a change. Epa regulatory menace lisa jackson abruptly quit because the Keystone Pipeline is apparently going to be improved. The New York Post reporter who broke that story joins us in a couple of minutes. Also tonight, one of the Biggest College Football Games of all time, notre dame versus alabama, two programs with rich and storied histories immortalized in movies. Watch this. Youre 5 feet nothing and hardly a speck of athletic ability. And you hung in with the best College Football team in the land for two years, and youre also going to walk out of here with a degree from the university of notre dame. College ran by real fast because i played so much football. [ male announcer ] how do you turn an entrepreneurs dream. Into a scooter that talks to the cloud . Or turn 30million artifacts. Into a hightech masterpiece . Whatever your business challenge, dell has the technology and services to help you solve it. Welcome back to the kudlow report. So Government Shutdown or not. That is the question. Our distinguished next guest was the first republican to publicly say a Government Shutdown should be on the table when it comes to the upcoming debt ceiling fight. But is that wise . We are pleased to welcome back Pennsylvania Republican senator pat toomey, senator toomey as always, good to see you. Firstly, can you clarify your thought that Government Shutdown should be on the table . Well, sure, larry. First of all, thanks for having me. And let me be very clear, i certainly hope we dont have even a partial temporary Government Shutdown. Because if you do, its disruptive, it is not optimal, it is really not the right way to run the government. But i will tell you, i think theres one thing thats worse. And what is worse is continuing down this road that were on which is going to end in a fiscal catastrophe. I think you know that, larry. When a government is running deficits of 7 , 8 , 9 of gdp, accumulated debt thats now 100 of gdp while the central bank is monetizing most of that debt and keeping Interest Rates artificially low, this is a terribly dangerous combination. And i think were living on borrowed time. So i want to start to see meaningful adjustments in the big entitlement programs, spending discipline that will get us on the road to a sustainable budget, but i just dont think we should throw the president another credit card without some kind of progress on the real problem that we face. Well, i get that. Couple things have always bothered me about this, though. If you just do a couple of numbers. I did it with Rick Santelli this morning. And cbo is going to revise these. But look, basically per month, were looking at 250 billion worth of revenues per month. If you take out debt expense, medicaid, medicare, and social security, you have already absorbed, lets see, 65 of those revenues. And i havent even put in, veterans benefits, smaller entitlements, and politically sensitive programs. Right. To me, thats an unnecessary explosion and the numbers just dont work. Well, but larry, again, you have to compare this to the alternative. The president s saying just give me an unlimited debt ceiling increase and were not even going to have a conversation about spending. Remember, this president hasnt been willing to address any kind of meaningful spending reforms except once in the context of the last time we addressed the debt ceiling. I just think its so important we have to do this. Im certainly hoping that it doesnt come to actually having some partial Government Shutdown and a scenario you described where some bills get paid and some dont. Thats not optimal, but i just larry, i think were on the road to greece. And i want to get off this road and on to a sustainable path. Why not make the rallying cry the spending sequester . Why not make that the absolute central part of the debate . And second, and second, senator toomey, john boehner wants every dollar of debt increase a dollar cut in spending. Why not insist on those two clear goals, no Government Shutdown, but force the president , force the president who right now is playing hard to get, force him to deal with that . Larry, theres no contradiction here. First of all, i think the sequester has to stay in place. I hope we can shuffle it around, i hope we can limit the damages on our Defense Budget and shift some of the cuts elsewhere. But we have to have the savings. I agree with speaker boehners dollar for dollar approach, a dollar in spending cuts for every dollar the debt limit has increased, but the president doesnt. The president is refusing to even have a conversation about it. Hes not countering with another proposal. Hes saying i wont even discuss it. And all im saying is republicans cant capitulate to this president insisting on unlimited Borrowing Authority and no responsibility. So we weve got to do something about this. So the obama pelosi trillion dollar tax hike which has been circulating in recent days and im sure you heard it on the sunday talk shows, that should be off the table. But you know, the debt ceiling increase is really was mandated last year with a sequester that never happened. That was last year. Weve got to do another one. Seems to me, if you want to raise it again, youve got to have another 1 trillion worth of spending cuts. Thats right. The one were talking about now was due last year. Thats exactly right. That should be thats been banked. Thats done, that was in return for the debt ceiling increase that we gave this president 17 months ago 2 trillion that he blew through in no time. I agree with you completely. Thats why that sequester has to stay in place and we now have to have a discussion about how we achieve the savings if the president wants any further increase in the debt limit. I would suggest the way to do it is reforming one or more of the big entitlement programs. Thats where were going to really get on a sustainable path. But youre absolutely right, we cant count the existing sequester, which was put in place because of the last debt ceiling increase. We cant count that twice. Sounds great. Senator pat toomey, thank you very much for walking through that. We appreciate it. Now, joining us to get some reaction to senator toomeys views, we bring in chris lehain and tony fratto, former bush deputy press secretary. Chris, let me just start with you. Because this sounds like a technical point, but its not. The debt ceiling increase were talking about came supposedly as a result of the 1. 2 trillion spending cut sequester that never happened. Now, that to me is bizarre and democrats want to replace it with more tax hikes. Well, you have had this ground hog day aspect to this, right . Where you continue to kick the can down the field. The reality is that we currently have a political Market Forces that are inconsistent with doing the right thing by our economy. I mean, you just heard the senator, i would suggest if he feels that way, he may want to begin by having a conversation with his own leader, senator mcconnell who spent the weekend talking about the fact that he was only going to look at one aspect of this. The reality is, if youre going to bring people together, it does have to be a bigger deal with pieces from both sides. Otherwise youre going to continue to have the same process. We kick the can, we dont make any of the hard decisions and end up with a situation we just saw this week. Look at the cover of the economist, right . The cover of the economist is making fun of our country. Whether youre a democrat or republican, i hope every member reads that. Because its making fun of our process. And i say that as an american. Its totally dysfunctional. Its a great point. Tony, look, to me this Government Shutdown stuff goes nowhere. The revenues dont match the spending on a monthly basis. Youre going to get all kinds of trouble. And messing around with the debt ceiling, tony, that is even worse because that brings in International Ramifications and the Credit Rating agencies. Yeah, im with you on this, larry. I have been for a long time. And as a former assistant secretary of the treasury before i went over to the white house and fought a whole bunch of debt ceiling battles with both democrats and republicans throughout my time in the administration, its not a great law. Its not great ground to negotiate on, as well. If youre in the congress because you know at the end of the day it is going to have to be raised and shutting down government, you know, chris was there. Weve gone through Government Shutdowns before. And Congress Never wins in that situation. And i think that would be the case today. The sequestration, though, there is a possibility of negotiation there because you have both sides who are going to feel some pain by those cuts. I agree with you, a deal was made on sequestration in order to get the debt ceiling. Should have to live with it. Now this a deal is a deal. Right. This sequestration this spending cut today was done a year ago and they raised the debt ceiling. Theyre a year behind. And you work for bill clinton. And i am an admirer of many of bill clintons economic policies. Bill clinton, gingrich, a handshake was a handshake. They said they cut spending, they cut spending. They said theyd reform welfare, they reformed welfare. These guys, its like a floating crap game. I cant figure out whos on first and the money is going into which sewer. I do think ultimately its not going to be the debt ceiling. Thats one where Congress Almost by definition is going to lose. Its a poor place to have this discussion. Its going to happen in and around sequestration. And you made a point earlier about the fact why dont the republicans come up with a clear idea and clear frame. I think that applies to both democrats or republicans and i would submit the first side that does it in a clear big way that provides a bigger context and framing is going to be much stronger position. Thats where the fights going to take place. There is one clear deal i would make, larry, and i would recommend both sides to make. Real quick. Change cpi for the debt ceiling. Get rid of the debt ceiling, permanent fix. Im for that, everybodys for that except Senate Democrats arent for that. Well see. Thank you very much. Awfully sensible, if i may say so myself. Tony, hang with us, were going to have you back as a football analyst. But weve got some good news and even some better news. Now, listen to this, regulatory menace lisa jackson from the epa is not only out at the epa, but the reason shes out is because the Keystone Pipeline is apparently going to be fully approved. 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Well, get this, she was convinced and angered that president obama was ready to give the Keystone Pipeline a green light. Well, here now is the New York Post senior reporter, coauthor of the jersey sting. First of all, we know shes leaving. Yes. That she announced. Second of all, do you know with certainty that obama will approve the Keystone Pipeline . In other words, does a lead to b as youve said in this . I know she believes its going to happen. Remember, its an international project, its a state department. But she is the president s primary adviser on environmental policy and shes convinced and let it be known to her inner circle of friends that she believes the president will approve it and she will not be in the building. And she wouldnt say that if she didnt know it. And all of that stuff goes on inside at the staff level and the cabinet level. Right. So we know this is where im going on this. Lisa jackson, lisa jackson. We are now in possession of a lot of knowledge that says the Keystone Pipeline will go through. Thats the best news ive heard in i dont know how long. Well, im glad you like it. Look, they always say in politics you follow their feet, not their words. And whats happening here, the actions leads you to a conclusion. All right. So the war on keystone coming to an end. So lisa jackson, this woman, who i think was a regulatory menace. First of all, destroyed the coal industry. Not according to her. Right. Just destroyed it. The regulations on coal and Carbon Emissions and all manner of that industry, she is not only new plants but existing plants are going to be destroyed. That was one of her legacies. But she also wanted to push even harder. Remember, she almost quit over a year ago when the white house pulled the rug out from underneath her in the clean air act. So she really ozone. The ozone. Right. She really believes this. Lisa jackson and ive covered her for a lot of years already. She really believes am i wrong to call her a regulatory menace . You can call her a regulatory menace. It wouldnt be the first time somebody called her that. One reason im glad shes gone, unfortunately, theres probably four of them to back her up. They were going to declare war on fracking oil and gas shale, that was coming. She actually is in favor of fracking, and the editorial page applauded her for having the position but the epa in their district offices perhaps. And im just asking whether the next one to replace her will go after fracking. Well, right now her assistant is going to become the acting administrator and its unclear when the president s going to nominate a new because she said i read this statement. She said regarding fracking, that under the right regulatory conditions, fracking would be okay. I dont know what that means. For the fracking industry, its better f its important to know this because of her replacement. You say her replacement might be her assistant. Well, her replacement temporarily definitely will be her assistant theyre saying. And the question is who is the president going to bring in after her for the next term. All right. Youre going to report on that. When are you going to give us on the scoop on that . As soon as my sources deliver it. All right. Thanks very much. Touchdown jesus. Notre dames first comeback since 1988. Were about to look at the academic success that goes along with the athletic success in south bend, indiana. [ male announcer ] how could switchgrass in argentina, change engineering in dubai, aluminum production in south africa, and the Aerospace Industry in the u. S. . At t. Rowe price, we understand the connections of a complex, global economy. Its just one reason over 75 of our mutual funds beat their 10year lipper average. T. Rowe price. Invest with confidence. Request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. Officemax can help you drive, rissupply costs. Penses down. And down. Just use your maxperks card and get a case of x9 paper for only 1cent after maxperks rewards. Find thousands of big deals now. At officemax. Tonight, one of the Biggest College Football Games of all time notre dame versus alabama. Not only does the fighting irish win big on the football field, but their players are real student athletes. They actually go to class and graduate. Someone else who graduated is cnbcs own Brian Shactman who joins us with the details. First of all, this is a big comeback for notre dame. Yeah, they havent won a title since 1988, larry, and its probably one of the most well known College Football brand on the planet. People know notre dame football. So its good for everybody in the world of football. When theyre good and its been a long dry spell. This is the first time in history of major College Football where the Number One Team in the country undefeated notre dame is also tied for number one with Graduation Rates or northwestern, which is also a pretty good Football Program now with 97 . And its funny now, go ahead no, just a question. On the Graduation Rates, which i love, do the Football Players graduate . They do. It might take them five years, might take an extra year, get a red shirt. Theres fascinating stories about how they do it. Not only are the standards of notre dame are high, but they have a former incredible story of a former lacrosse player whose head of their academic unit helping these players through, notre dame grad, and he drills them. He has a record of being hung up on, not having his phone calls returned more than anyone on the planet, he doesnt give up on these kids. Alabama, everyone sort of ridicules the education of the school. Which is not fair. Theyre up to 75 . Theyre not getting the same kids. And weve talked about off camera, notre dame gets the best of the best in terms of students and athletes put together. They do. They get the best im going to say because of their brand and theyre so famous and so symbolically catholic. They get the best from the catholic high schools all around the country. Right. I want to bring in cnbcs own distinguished notre dame alumni. Most distinguished. Her name is Mary Thompson. Marys coming to us from miami. First of all, good evening, mary. Reporter good evening to you, larry. Wish you were here. Its been a great weekend. Actually, i wish i were here too. I want to ask you, is god on notre dames side tonight . How do you handicap this . Well, the other night on notre dames side so that for sure. How is the alabama side . In fact, step back a minute. Whats the whole atmosphere there . Is it tense . Is it playful . Is it just excitement and enthusiasm . How do you read it . Just to give you an idea, there were two pep rallies on the beach in miami on saturday night. Just to give you an idea of how enthusiastic the notre dame fans are, at least. 1,000 alabama fans showed up for their pep rally. 15,000 notre dame fans showed up for theirs. I cant really speak to alabama, but the feeling here is one of excitement and confidence. All right. Enjoy. Enjoy. Good luck for you. Brian shactman, one other thing. Notre dame is not in a league, right . So a game like this is a massive financial importance. Yes. They actually have started to affiliate outside of football with the acc now. But because theyre an independent, they actually notre dame gets status that no other school gets. Theyll get 6. 2 million they dont have to share, therell be 20 million plus for alabama, but they have to split it with every school in the sec. Their tv ratings broke records this year, many people think their worth the special treatment because people watch them when they play. People either love them, or dislike them. Dislike them . How can you dislike notre dame . Because youre either in with them or against them. Not religiously based, theyre on top, pristine, smart, and good. Good catholic convert that i am, im going to root for notre dame, but i have watched a lot of alabama Football Games this year and they are good. Well coached. Thank you very much. And Mary Thompson right down there in florida watching it in person. Who is going to win it all tonight . Notre dame or alabama . Lets go back to our panel for hot picks. Tony and chris. Tony, youre always tweeting about sports. Who is going to win tonight . Roll tide, larry i grew up in a catholic neighborhood, but i was a big pitt fan and i had to deal with all of these notre dame fans. So i grew up hating notre dame. Roll tide all right, roll tide. Chris, you have a more sensible view. I thought he would say win one come on. I grew up in a catholic family watching notre dame football on saturdays was a part of the ritual, i think the notre dame line is going to be big enough and Strong Enough to battle with the o line from alabama and the linebackers are fantastic. Im picking im going with the irish, baby. Chris lehane, let me ask you since you clearly have deeper insights into notre dame than tony fratto does, what took them so long . From 1988 until now. They have one of the greatest brands in football. They do have the, you know, Catholic Schools all across the country who produce fabulous Football Players in other athletes revere notre dame. Why did it take them so long to get back on top, chris . I think a couple of reasons. First of all, not being in a big power conference while it has been great on the revenue side particularly with the tv contracts has potentially put it at a disadvantage. I think secondly, frankly, its been a lot tougher to recruit the types of athletes you need in big time football now particularly with the sec schools and the schools on the west coast being able to get the type of talent that that generation ago would go to notre dame. But ultimately at the end of the day, its about coaching, went through three or four different coaches, finally ended up with a great coach. I do have to give a shout out here on the west coast to stanford, another great academic. Imagine harvard ending up in the top five. No, its a good point and Brian Shactman mentioned northwestern, its another excellent academic school. Tony fratto, alabamas a pretty good school, isnt it . Its a terrific school. Although, i knew you were going to do this and look at Graduation Rates. I looked at their Graduation Rates and brian noted there is improvement in alabamas Graduation Rates. I went to look for a notable business leader. Hard time finding notable business leaders. I did see Bernie Madoff attended alabama, did not graduate from alabama. They wont be highlighting that tonight. They wont be highlighting but tony, quick on the way out, the sec is supposed to have by far the best College Football. Its a terrific conference. I think 7 of the last 9 championships have come out of the sec. They love their football down there, thats what they focus on and what youre seeing with a lot of terrific programs. Im not taking sides, im trying to be a reporter objective for a change. I know its not my standard, but chris lehane, thank you very much, you were terrific and tony fratto from alabama tonight. Im larry kudlow, free market prosperity can work in football fields too. Almost tastes like one of jacks cereals. Fiber one. Uh, forgot jacks cereal. [ jack ] whats for breakfast . Um. Try the number one yeah, this is pretty good. [ male announcer ] over a third of a days fiber. Fiber one. Office superstore ink retailer in america. 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