You. Stuart no you werent. No, you werent. You were extending my show by 49 seconds. Neil no. I was worried for you as i was relieved for women in saudi arabia who can now drive but you know they you know, conflicted me. But i want you to be well. Stuart youve been working on this relationship we have for the last three or four hours, havent you . Neil i have been worried. Ive been watching. Hey this, is not my buddy. This is not the guy i knows. Whose tax cut was already tucked away and saved. Not spent, mind you. Just saved. Stuart never spent. Never spent. Wellsaid, young man. Thank you very much, stuart varney. Well pick up the baton. As stuart indicated there are big question marks Going Forward. Not only about the tax cut plan, but who benefits, who doesnt, what to make of socalled fourth rate could be in effect here. The fact that businesses, while they will see appreciable cut in overall rate if the president has his way to 20 , from established 35 , keep in mind the prevailing average rate corporations pay in this country works it to a little under 27 . That is the average of s p 500 companies. The gap between that and 20 , rate, maybe, it is not quite as robust as you think. It is about what is included, ultimately not included. The president will make his pitch for this with the indiana fairground, they ben efficient the appreciably from big tax cuts. One of the few states done so, seeing bang for the buck. Well explore that a little more, first to blake burman, how the white house rolls out the red carpet for just this sort of thing. Blake . Reporter hi, neil. We hear the president will talk about the rates at this event in indiana later today. On the individual side big changes as theyre collapsing number of brackets down to seven, to three. Bottom end 12, 25 middle and top end 35. As you talk about, there is possibility within this framework that maybe for the upper echelon, wealthiest of americans that number could creep up a little higher than 35, somewhere below the 39. 6 rate. Calling for the tax reform framework, elimination of the death tax. The elimination of amt, many other deductions as well. On the corporate side, it calls for a corporate rate of 20 . And a Small Business rate of up to 25 . Neil, the white house feels very good where they stand with this they think this is winner this, plan. They think it could possibly get democratic support, what theyre seeking. There are skeptics. That includes top member on Senate Finance committee orrin hatch, who acknowledged at least this will be a tough lift politically. So i would like to bring those rates down for basically everybody, including businesses as well. It will be tough to do. Were so equally divided that it is almost impossible to do without some democrat help. Im hopeful that we can do that. Reporter in the white house the president drawing some red lines. Gary cohn saying there are two red lines. Quote the president made it very clear that 20 as corporate rate is a red line for him. He is at 20 . I think the president made it very clear there have to be a middle income tax cut. I think those are his two big, bright, red lines. Neil, back to you. Neil you know, if the 20 was the big red line, why didnt mr. Art of the deal start out with 15 , right . You know that rate will only get negotiated up, right . Reporter theyre saying this is nonnegotiable. President on campaign trail talked about 15 . Paul ryan on the hill had 25 . Right now the starting point is 20 . Mark meadows, Freedom Caucus, the red line to 20 . At least that group in the house, that appeases. Apparently everything is negotiation with the president but apparently on this one it is not. Neil when the president goes to indiana, so far taking joe donnelly, democratic senator from that state with him, barring any other senate votes that could come up. Is that a possible vote for a tax package has scant few democratic supporters or what . Reporter this is the second time he has done such a thing. Did the same thing with Heidi Heitkamp earlier. Joe donnelly, one of three democrats initially did not sign a letter to the president three weeks or so, which they laid out what they want to see in the tax reform framework. He is seen as a possibility since he didnt sign on to that. Indiana, a state President Trump won in 2016. A state produced the Vice President. So there is some strong republican ties there. Theyre using this as their launching point to try to get potentially joe donnelly on their side. Neil thank you very, very much, my friend, blake burman in washington. That will be the Battle Royale for the remaining, weeks, months of this year. It will be an uphill battle as orrin hatch was telling Maria Bartiromo earlier today. A number of politicians have been telling us over the last few days, just it sort out differences and they are ample between republican factions that could take months. That has folks wondering forget tax cuts this year. Forget about retroactive tax cuts applying to next year. Way too soon to tell. Charlie gasparino, Political Capital reporter rachel bade and economist dan mitchell. Rachel, let me begin with you. Your thought the people you talk to for the timetable for all of this. Assuming they can iron out differences with idea of a fourth possible rate but what are you hearing . There is wide june dilllation right now. I have republican sources at gop retreat where paul ryan and mike pence will try to rally usually divided House Republican conference around the bill. Folks say they like what theyre seeing, hopefully they get it done by the end of the year. Reality in the senate, including number one tax writer, they dont think they can get a gop tax bill through the senate with 51 votes. They are talking about to reach out to democrats. The president made it clear that he wants to work out with democrats. That is the fourth income bracket might come in. The president will tell the dems, i will not reduce taxes on the wealthy. If he will say that, they will need that 39. 6 to stay there, not decrease to 35. Neil or even 37 38, some other figures. Three democrats you want to woo. Joe donnelly of indiana, joe manchin, and Heidi Heitkamp, three senators didnt sign on to the to the letter, dont give a penny of tax relief to the wealthy. How many of them, of those three, are wooable . Im going to get optimistic on because who are republicans who might vote no . Collins, murkowski and mccain. Thats three. That brings you back down to 49 from 52. You need one of those democrats to get you to 50. Pence can be a tiebreaking vote this is bill, in theory, Cutting Company tax rate, which even a lot of democrats realize is shooting the u. S. In the foot by being uncompetitive, you have this near doubling of the standard deduction for the middle class it, will be hard for some democrats to vote against that, even though it includes death tax repeal and a few things they dont like. Neil donnelly does have a record, i think, Charlie Gasparino, supporting tax relief in 2010. Sure. Neil voted for equivalent there. Where does this stand . What are people telling you . Ive been looking at the markets were reporting this. We should point out there is not a sophisticated investor i know that the tax cuts are baked into this market. This is net, if it does happen it is net positive. If this was definitely going to happen, or if markets believe it has strong likelihood to happen, the market was not be down or breaking even. What you have here Investor Sentiment saying this wont happen. I will say neil they were up a lot this morning. When you start seeing neil details. Details. It is not a detailed plan. Here is the thing i mentioned to you this morning, my sources on the hill tell me, okay, so much of the heavy lifting will have to be done in committee. When that, im not an expert at the legislative process, but when you start putting this in committee, when people are going to have to deliberate at that sort of granular level, it really grinds us to a halt. I will say one other thing. Will the Freedom Caucus, will conservative republicans agree to a tax increase . Which is how, how trump is trying to sell this . Neil on the wealthy . Are republicans going to look themselves in the mirror and say, i voted for a tax increase on the wealthy . Do people who by the way, pay most of the taxes. Neil what do you think of that . Of course it is how it is presented. If the rate stays roughly same, or comes down, offset by limiting deductions state and local income taxes all how it is presented. But in that Committee Process you know so well, a lot of things can change and get dragged out. Now were well into next year, but what do you hearing . The Freedom Caucus, conservatives on the hill, will not back a tax increase, i can tell you that pointblank. Not only them, but gop leadership in the house will not go for Something Like that either. Neil how do they feel, rachel, how it is presented for the upper income . Because they left that openended debate. You might have a fourth rate for bargaining chip. What do you think . Theyre leaving wiggle room for keeping top rate where it is now, which would not be an increase, but leaving it where it is for most wealthy americans. Even that will be hard for conservatives to accept but i did talk to some centrist republicans, for instance, tom reed new york, close ally of trump and on the ways and Means Committee, he said not a big deal. This is about middle income americans. As long as nobody gets taxes increased and folks in the lower middle income brackets are getting reduction he thinks they can do something. I think this is tough sell for conservative. I cant imagine conservative go for tax increase. No. What are the deductions they want to eliminate . By the way you notice how, i dont think the state and local Tax Deduction, ending it, the state and local Tax Deduction is in the draft right now. That will be hammered out in committee. Neil i thought it was . I think what they hear we want to eliminate it. I dont know if it specifically states. Neil do you know, rachel . I think this was one thing included if there or no . The state and local . Theyre looking to get rid of it. Use it as a payfor. Is it the outline they put out . I dont think. That is the funny thing. Neil well get confirmation. Theyre talking about it, talking about it amongst themselves at the gop retreat. That is something theyre looking at. Neil mortgage, charitable thing, deductions they want to save for rich and not so rich aligning. Youre worried when they get into the weeds of this thing it will get dicey. It will get ugly. Neil, they are allowing rich private Equity Managers to benefit greatly, steve schwarzman, trumps, runs blackstone, trumps Economic Advisor to keep the cherished loophole, carried interest, yet some family of four in long island will get screwed on the state and local Tax Deduction loophole which is eliminated. Mindboggling they allowed carried interest but screw some guy in long island. I dont know how they sell that to peter king. Neil dan mitchell, if you had to play this out, lets say theyre able to just get this approved in narrowest of margins, only question is when, if it is next year event, how do republicans feel about that versus this year event . They obviously want to do it this year but here is the real challenge. Youre taking a big tax cut, and under the budget rules, in terms of what you can make permanent, youre trying to fit it into a relatively small, like lineman into peewee hermans clothes or Something Like that. What will be permanent . It will be Corporate Tax rate reduction. Im guessing state or local tax rate reduction to pay for that. Corporate tax rate of 20 . State and local deduction which encourages bad policy in new york and california, get rid of death tax, those three things by themselves would be a big gamechanger. Republicans no one thing above all else, they have screwed up everything else. If they cant cut taxes which is only reason god put them on earth, if they cant cut taxes they might as well just resign ahead of the 2018 election. That will give them a lot of pressure. If you get rid of state and local Tax Deduction and keep the carried interest deduction, right for rich, fat cat private equity guys neil calorically challenged. Calorically challenged rich guys, you screw over a family in long island, how do you get peter king to agree to that . This aint happening. It will be interesting debate on these deductions. If they think theyre getting it done six weeks, good luck. Neil rachel, real quickly, there are about 60 republicans who come from such districts directly affected, california, new york, illinois, i think new jersey. That would be directly affected by that provision. That is assuming they all vote against this, because they find that the losing that deduction costs their constituents more than the net tax cut they will enjoy. Would that kill it . If they all voted against it, which i cant envision, but, what are your thoughts on that . Maybe if they all jumped together they would be brave enough do that. Call peter king right now, see what he says. No, i think that there is a lot of pressure right now to get this done and i think that although there are a couple dozen republicans from these districts who have the state and local Tax Deduction and who really benefit from that, if they are republicans, leadership will be talking to them, probably already has been talking to them, selling them on other parts of this bill. They dont want to be ones that brock this at least in the house. I do know a lot of house moderates, they do not want the weight of president coming down on them especially after repeal fell through where republicans are scrambling right now. Neil logic would tell you not to be suicidal but past history proves very suicidal. Thank you all to your points here. Cost of this tax, if you look at a cost, many write me you cant cost out tax cuts, play along with me here. Five trillion over 10 years, already in the Senate Republican blueprint theyre calling for 1 1 2 trillion dollars budgeted for tax revenue lost over the next 10 years, they have to come up with 3. 5 trillion to address making sure they make that budget figure. Where is the 3. 5 trillion coming from . You get 1. 5 trillion removing state and local tax deductibility. As mr. Gasparino pointed out, you also potentially torpedo the deal. That is small part of remaining 2 trillion you have to cut. How do you do that . After this. What did we do before phones . They save us from getting lost, getting hungry, and getting tired of places like this. Phones changed everything shouldnt the way pay for them change too . Introducing Xfinity Mobile. Where you can pay for data by the gig, and share it across all of your lines. No one else lets you do that. See how much you can save when you pay by the gig. Xfinity mobile. Its a new kind of network designed to save you money. Call, visit, or go to xfinitymobile. Com. Neil as you know by now, roy moore won senate race in alabama. Media branded it a big loss for donald trump because he supported establishment senator there. What does this mean Going Forward . Lets get the read from ron meyer, red alert. Alabamaians as much as they love donald trump they hate Mitch Mcconnell more. That won out. That is how they felt about that part of establishment, Mitch Mcconnell backing Luther Strange, republican senator than any reflection on donald trump. I dont know if that is true, but what do you think . I dont think the democrat attack will last any longer than 24 hours on this because it is not resonating. Everybody knows, especially in alabama, they do support donald trump. If anything this is message from donald Trump Supporters to donald trump, saying we want you to listen to the conservative side in your administration, not the establishment side. We want you to listen to the Freedom Caucus, not paul ryan and Mitch Mcconnell that is the message those people were trying to send. They dont want Luther Strange that will be blindly loyal. They want somebody like roy moore who will be independently conservative and push the narrative. Neil even if theyre blindly loyal to the president they seem to like . Yes. Neil conundrum to put these characters in that kind of box, right . To you and me that is what it seems like. Remember these people are conservatives, when they see donald trump making a deal with nancy pelosi and Chuck Schumer and listening to paul ryan on issues, failing to pass Obamacare Repeal they want to push donald trump back where he ran. Not that they dont support him. They want him to be him this is alabama a conservative state. Conservative states will particularly pick conservative candidates in primaries. This is a message to donald trump to say get back to the conservatism. Neil ron, i can interpret the results, one of the reasons i think, i could be wrong, corker bowed out running reelection in tennessee, maybe he envisioned a divisive battle on the right. The president himself teased such a scenario. I wonder if it emboldens such groups given success of judge moore, put up farright challengers to even right incumbents . Yeah. Neil where is this going for next year . You see steve bannon going down there. A lot of folks going down there to stir this up. No doubt they will have another tea Party Primary wing. Instead of tea party, trump nationalism wing pushings tr