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by at the capitol to give us the inside scoop and tell us what he wants. meanwhile, the market rally came to a screeching halt. the dow fell 135 points on the day. the fitch rating agency has put the u.s. credit rating on watch which could send stocks lower tomorrow or maybe not, actually. could be a great buying opportunity. dominic chu is watching your money. the incomparable ann colter. question, does she think the gop should keep fighting or retreat? we'll hear from her in just a few moments. another dramatic breaking news report of the "kudlow report" is starting right now. good evening, everyone. i'm larry kudlow. this is "the kudlow report." feverish negotiations continue on capitol hill. we're getting closer to the october 17th debt deadline. the house was set to vote tonight on a republican plan but that apparently is not going to happen. joining us now live from washington, d.c., cnbc contributor, robert costa. good evening, robert. what happened? why isn't the vote being voted on? >> speaker john boehner and others spent the day on capitol hill. the gist of the plan was to extend the debt limit through early of next year and to reopen the government plus have all congressional employees not have federal contributions but ultimately by late tonight the speaker was not able to get the vote so he pulled the bill. >> in your judgment or in your reporting what you hear, what the buzz is, why can't he get the votes for that bill? very important. very popular around the country it seems to me. certainly popular, the president, senators, house members and their staffs should all be part of obama care and lose their very, very curby subsidies. now a lot of conservatives wanted that. why are the 218 votes not there for it? >> because inside the republican party right now there is almost a civil war when it comes to arguing how to proceed. the conservatives in the republican congress want to make sure they keep fighting obama care. they're not willing to accept a cr and debt ceiling increase. >> so as a consequence, we'll come back to all of these issues in a moment, the senate itself hasn't voted. i heard from some people up there that there's a chance that there might be a filibuster by mr. cruz. >> that is a possibility. senator cruz has been huddling with his friends and conservatives. the big news tonight is because the house gop is unable to get 218 votes behind its own plan, the action now goes back to the senate. it reid and mcconnell cobble together a deal at the 11th hour. >> robert costa, stay with us. we'll come back to you in a minute. dominic chu, how are the stock markets reacting? not a great day. what's up, dom? >> stock futures are pointing to a flashish open tomorrow and that's because fitch, the ratings agency, put the u.s. on a rating's watch negative earlier this afternoon. stocks snapped their winning streak in the regular session with the dow closing down 133 points. you can see on this chart here the dow took a -- it went down after 2:00 p.m. when the senate put its own negotiations on hold to see what would happen with the house and what they could come up with. overall, larry, markets down today. we'll see how they react heading into tomorrow morning. >> thanks very much, dominic chu. we'll see you later. joining me now, syndicated columnist, ann colter. a new book "never trust a liberal over 3". >> the congressman you were having on, i saw him on tv recently. i'm so happy when we finally have an articulate republican. >> conservative. what's your quick take on this story, strategically republican party can't seem to win senate elections, presidential elections. does this help them or hurt them? >> it helps. even if they completely pass the budget, pass it, raise the debt ceiling and by the way, those are two different things, this three weeks has been magnificent. it's inspired conservatives to see republicans are dead set on repealing obama care. by the way, how is that christine o'donnell race look now? how does the richard mourdock race against ruble look now? all of these sacrificed senate seats, yeah, you had a lot of fun when it happened. going for a totally purist conservative. gosh, i wish we had a majority in the senate. >> does this polling trouble you? the polling has gone against the republicans essentially the country, quote, unquote, from the polls blaming the republicans for the shutdown. not so much the debt ceiling. i think people hate debt, but they do blame the gop for the shutdown. how does that play? does that get worse because if the votes don't come through -- >> right. >> they're going to be blamed again. >> well, two things. one is the gallup poll was complete nonsense. not because it's gallup, this is a completely irrelevant poll. all adults are 50% of the people who can't name the vice president. likely voters occasionally tune in. they're picking up the background noise. that's 100% influenced by the mainstream media. >> you don't think this is a self-inflicted wound by the republicans? >> no, i don't think so. >> among analysts and among republicans themselves. >> what i say, two things. the polls of the likely voters split it 50-50. that's not that good considering it's 1% of democrats. switch the parties. if there was an unpopular bill, a majority democratic house were refusing to fund, how do you think the mainstream media would be covering that? that's not the way the conservative media is covering it. >> stay there. i have to bring in ohio republican congressman jim jordan. i think we have him strapped. >> good evening. >> you look great. we appreciate your time. we know it's a hectic night. can you tell us why the votes have been canceled on the house? >> larry, today we put a simple idea. fairness with equal treatment under law. a simple idea that says we'll do the cr, do the debt ceiling short term, real short term, but we want to make members of congress and the president live under the law that we wrote. simple concept and the democrats won't even entertain that idea. that was something we floated out there today. we thought it made sense. we thought it was consistent with equal treatment under the law and fairness, an argument we've been making under the law and yet the democrats don't want to go there. we'll see what happens. >> when you say the democrats, are you including the senate democrats as well? the senate democratic leadership? >> that's what we heard. nancy pelosi said no. this is as reasonable as you can get they've been arguing, do the cr, do the debt ceiling, clean, clean, clean. okay. but at least make members of congress, make the politicians live under the laws. they said, no, we can't even do that. this is where we are. we'll see what shakes out in the next few hours. >> what do you think will shake out in the next few hours? i want to add to this, heritage action, one of the conservative tea party nonprofit groups, they made this a major issue and want house members to vote no on this bill. do they have additional -- does heritage action have additional points that they want you all to put in the bill? do you as a former head of the republican study group have additional points you want in the bill? >> obviously you want to delay the whole law. we think that's the right thing to do. we think that's the fair thing to do and yet we're the ones -- the president says we're the ones who are terrible, we're the ones who can't figure this out. yet they had an influence, i think. the simple fact is the president said he would veto it. nancy pelosi said she was against it. harry reid said this was a nonstarter. even something as simple and basic as that, they won't entertain that idea. >> what would happen if mr. boehner then just proposes a clean bill? does it pass the house with democratic votes or not? >> i don't think you'll see republicans want to support that. we want to do something fair. that's why we floelted this idea. we want to delay this thing. we thought this would help to get to that. it looks like that's not going to go. >> do you think any other provisions will come up as you all meet tonight? besides the car of ocarve out f federal government. delay is a hot topic. anything that may come into the bill? >> i don't know. you're right, joe manchin has been on record saying he supports it. the unreasonableness of the democrats to even entertain a simple concept like we put forward today, like we did the last five weeks. we're getting labeled as strapping bombs to our chest and this is so simple, so fair, so basic and they can't even take that. >> one last one on this whole story. suppose this thing goes through. suppose this thing goes through. the cr, the resolution if i'm not mistaken, in your plan goes to december 15th. the debt limitation goes further, february 7th. that's not a lot of time. that's a couple of months. even if we roll this one through, even if you got the carve out fixed, you're still coming back for another round of drama and that could shake up the markets, could shake up the economy, who knows. >> well, but, again the underlying problem, as many times as we can get a chance to deal with the underlying problem, that's the $17 trillion debt. you can't keep maxing out -- a limit on an already maxed out credit card. you can't keep doing that. if we have to give it back, cut spending and put this country on a different path. >> thanks for hustling over, truly. >> you bet. >> we'll talk more with ann colter about the long-term political ramifications of all of this. will republicans ever carry the senate or the white house again in my lifetime? we'll hear from her. don't forget, folks, free market capitalism is the best bet. obama care has nothing remotely to do with free market capitalism. i'm kudlow. we'll be right back. at a ford dealer with a little q and a for fiona. tell me fiona, who's having a big tire event? your ford dealer. who has 11 major brands to choose from? your ford dealer. who's offering a rebate? your ford dealer. who has the low price tire guarantee, affording peace of mind to anyone who might be in the market for a new set of tires? your ford dealer. i'm beginning to sense a pattern. get up to $140 in mail-in rebates when you buy four select tires with the ford service credit card. where'd you get that sweater vest? your ford dealer. welcome back to "the kudlow report." at this hour all eyes on the house as it gears up for a vote on its latest plan to avoid default, but will the deal come too late and too little for a public that's ready to kick them all out? 60% want to kick them out. we've got cindy dated columnist ann coulter. her new book is called "never trust a liberal over 3." there's a big fat picture. thank you for staying around. your bottom line is, if the thing goes on beyond thursday this will not hurt the republican party and their chances to win back the senate in 2014. >> i'm not sure what will hatch. i don't want to be encouraging them not to have it go on. the fact that the government is shut down and that democrats refuse to live under obama care. republicans would be sitting pretty. i'm saying i think there's already one and republicans should be proud and they shouldn't be angry at our elected republicans if they end up raising the debt ceiling because -- >> they'll never default. treasury i want to say this again to you and to our viewers, treasuries will never default, never. period. end of sentence. there's a $200 billion surplus per month per average that will cover the rest of the expense. the rest of the budget will suffer, yes. that might not be a bad thirng. i'm not for an immediate shutdown, nobody is. >> they should work harder in the 2014 elections to make sure we win elections even if you don't see christina o'donnell on the ballot, have you to vote for the republican. >> let's talk about that. why can't republicans win these damn elections. i want to ask you this, years ago bill buckley, my former boss, coined the phrase in elections you vote for the most conservative candidate who can win. >> right. >> all right? it seems to me in 2010 and 2012 we republicans have not done that. we have ignored this and that's why the party's been hurt. >> in some cases there are a lot of reasons. it's a party that's not overly concerned with winning. it's a party that's overly concerned with making money, self-aggrandizing positions and running a purist conservative in a place where a purist conservative is not going to win. i like christine o'donnell. can you imagine what the democratic party would do to any democrat who tried the primary ridiculously conservative democrat mark pryor in arkansas. they understand these are conservative states. we'll run john tester will fool the hicks, will get a democrat in, we'll have a majority in the senate. why doesn't our base understand that? >> where's the selection process in the republican party? i think this became an issue with the tea party rise, but i think it's been an issue for a long time. i think the party is right now in an internessian warfare. the ted cruz stuff has triggered a lot of warfare and bad blood. john mccain, peter king. >> right. >> how is the gop going to get around that for next year's election? >> they have to read my book and follow the first three chapters. i feel the pain and i'm one of them, a conservative who's constantly getting blamed. it's always the moderates, what are referred to as the establishment. it's almost fun seeing the conservative republicans attack the establishment back, but that's not winning elections. >> right. there's a circular chute going right now. >> yes. yes. >> unfortunately whether this is right or wrong, this debt limit and continuing resolution budget stuff makes that worse. >> and no one, no one should be attacking ted cruz or mike li. we finally have bright, articulate republicans whom you just had it on. >> so let's get it over with. why not? this might violate some conservative banner. why not have him go with a clean bill and say let's get out of here. we've dug a ditch. some people are going to be hurt. let's just get out of here and then go for better budgets in the months ahead? >> yes. they still have leverage with the budget. they have 20% left. they still have leverage. raising the debt ceiling would be fine. main point the conservatives should remember is we've done a lot already. to be able to have jim jordan say the reason the government is shut down is because democrats refuse to live under obama care, get that out. next time we have to take the senate. >> be pragmatic. >> be pragmatic about winning. >> can i say that, the sequester? gop gives up the sequester, they should be shot. >> the sequester is fantastic. >> go for tax reform. stuff democrats won't do. >> yes, that's very popular. it's very popular to be against obama care as we've seen with this rollout. they have gotten obama care in the news and everyone is talking about it for three weeks. be proud of them, republicans. >> you know, somebody e-mailed me, i won't mention his name, but he's a pretty high ranking guy in the senate. ending obama care, if such a thing were possible, would be good for growth and jobs. >> absolutely. >> one thing is for sure, all of this has distracted from the anemic economic recovery which has plagued america. >> it would be good for health care. please repeal obama care, but this so far the three-week fight, we'll see how long it goes on, it's reminded republicans, we're going to repeal it when we get a majority. vote for republicans next time, americans. >> there he is a risk but it's a very interesting strategy. thanks to ann coulter. she'll be with us for the rest of the hour. the markets, dow off 100 points. might this be a good buying opportunity? i believe a deal is going to get done. we'll get some answers coming next up on "the kudlow report." please stay with us. could save you fifteen percent or more on car insurance. mmmhmmm...everybody knows that. well, did you know that old macdonald was a really bad speller? your word is...cow. cow. cow. c...o...w... ...e...i...e...i...o. [buzzer] dangnabbit. geico. fifteen minutes could save you...well, you know. make my mark i wawith pride.ork. create moments of value. build character through quality. and earn the right to be called a classic. the lands' end no iron dress shirt. starting at 49 dollars. for our children is something the purwe all share.ter life but who can help prepare them for the opportunities ahead? who can show them how to build on your success, but not rely on it. who can focus on making your legacy last for generations to come? that someone is a morgan stanley financial advisor. and we're ready to work for you. how old is the oldest person you've known? we gave people a sticker and had them show us. we learned a lot of us have known someone who's lived well into their 90s. and that's a great thing. but even though we're living longer, one thing that hasn't changed much is the official retirement age. ♪ the question is how do you make sure you have the money you need to enjoy all of these years. ♪ welcome back to "the kudlow report." i'm larry kudlow. stocks sell off. ceo of bull and bear partners and director of tjm institutional services. jack, i may not be a genius, but i know there's going to be a deal. there's going to be a deal. it may only be a three or four-month deal, but once that deal passes aren't stocks going to roar higher? oddly enough, might not this be a good opportunity to buy the dips? >> i don't think so, larry. unfortunately i think we're fully priced right now for stocks. the only risk i see right now is headline risk that could take us down. if it does go higher from here, it's going to do so grudge beginningly. you take out the government shutdown, what do we have? we have anemic growth. we have a lack of pro growth policies coming out of d.c. all we've seen is an expansion. take us back to where we should be. where do we go from here? i see way too much risk in the last couple of months we've seen the market going sideways. it's been a roller coaster ride. something happened today which we need to talk about. it's the first time we've seen the market vigilantes coming out of the closet. we haven't seen them for a long time. we saw it on one headline today. we saw the market drop precipitously. >> what was the headline? >> basically the fact that we aren't going to get a deal. >> of course we are going to get a deal. of course. put that away. these are politicians. we're going to get a deal. >> if it takes longer -- >> it might take another day. >> you're going to see the stock market get hit. >> maybe so. even better buying opportunity. come on, put some practical sense into this discussion. by the way, the only thing i saw about the awfulness of the deal, yes, two week treasury bills, stuff that matures at the end of october did jump up. any teensy weens si price change causes those yields to jump up. as you go further out to the curve they did nothing. >> right. >> in fact, the ten year is not collapsing. the ten year is over 270. so i don't get it. you know there's going to be a deal. i may not like the deal, you may not like the deal, the deal may not be a supply side deal but they're going to do something. >> there's no doubt there's going to be a deal. the more compelling standoff is between the government as a whole and the stock market. despiert the fact that the s&p lost 11 handles, it's rallied 11 handles. the stock market is saying this is no big deal. these 27 hours that are left in somebody's october 17th det l e deadline, that's plenty of time. the best way to get on camera is to have these deadlines because then the cameras roll and everybody is watching them. i hate to say it. there's somewhat of a little bit of an egomaniac. >> somewhat? why did you qualify that with an adverb. they all are. they don't want their goodies taken away. they're all hypocrites. they don't want their goodies taken away. fitch puts u.s.aaa rating on the negative watch. what does that mean, jack? your knees are knocking tonight. does this make your knees knock even more? >> no, that doesn't make my knees knock. there are other things that make my knees knock. the fact that we are going to get a new fed chairman and the fed chairman is going to get tested, it's a matter of when. the fact that we have charter members of the i don't have a clue club that don't realize they're playing russian roulette with the american economy. >> jack, they're not playing roulette yet. after tomorrow when we get into the gray area of when we may run out of money, that's when russian roulette begins. >> jimmy, they're doing it now. they're taking a notch from -- >> that's what they do. >> it's a rough night for reasoned discussions. i've got to jump out of this. i apologize profusely. we have breaking news. nbc news is confirming now that the budget discussions have now officially moved back to the senate. senate majority leader harry reid and mitch mcconnell spoke by phone this evening and agreed to restart their discussion. mcconnell spokesman says he's optimistic a deal will get done. i'm sorry, again, to jim urio and jack rousch. time to go to d.c. on the new, new stuff. where are we as the debt ceiling clock ticks down to zero. what's the senate going to do? the house looks like it's punting. i was made to work. make my mark with pride. create moments of value. build character through quality. and earn the right to be called a classic. the lands' end no iron dress shirt. starting at 49 dollars. . welcome back to "the kudlow report." live from cnbc headquarters in new jersey, we just had breaking news that the talks are back in the senate. harry reid and mitch mcconnell are back in the driver's seat. let's go back to washington, d.c., with ace reporter robert costa. bob costa, does this mean no vote in the house? is that number one? >> speaker john boehner can not find 218 votes for his plan. i've kented with my top senate sources. they say that mcconnell and reid have re-engaged. they've had a positive conversation and they're taking the raips. >> i know it's speculative. re-engage, robert costa. what do you reckon that means? they have certain due dates for the continuing resolution and debt ceiling and the long returned budget. the rest of it is a clean bill, even includes the sequester levels for a few months. is that what they're re-engaging on? are they going to change that? >> senate republicans are playing against an aggressive harry reid in the senate. the real job for senate republicans right now when you talk to staffers is to protect the sequestration cuts, protect the budget numbers. beyond that they don't expect to winch. >> boy, do i agree with you on protecting the sequestration. robert, last one. we'll see more of you later. at some point, correct me if i'm wrong as i recall from my days, the house has to vote on it. this is a money bill. >> that's exactly right. the problem for boehner the fact that he couldn't get the numbers on his own bill, he'll have to bring over the legislation from the senate. they don't want to accept any kind of senate deal. that's the kind of situation we're in now. >> ann coulter has given republicans in the house essentially an umbrella, a free pass to vote for a free bill from the senate. >> well, if it has ms. coulter's blessing perhaps that leans a little bit more than heritage action giving them trouble for voting in that area. the problem is they don't have the blessing. >> rob costa is coming back. nobody has a bill. there's not even the threat of a senate filibuster. there may be. where's the end game going to be, when, where, why, how? let's bring in north dakota senator john hoben. welcome. how do you react to this news? the ball's back in the accesena? >> it's much better if the house can get a bill and bring it over. senator mcconnell and senator reid are engaged. i believe we will pass something. ultimately the house has to pass it. if they can start a bill and bring it over, it would be faster. we'll bring something. >> do you think the senate version, which we thought was going to be the bill, is going to change? >> i hope not. i'm very concerned that the other party feels like they're in a negotiating position. we want savings and reform as part of the debt ceiling. we're in a tough spot in that regard as well as get a cr. and protect the budget level, the bca budget levels, protect those so we get a grip on spending. >> budget control act. you may only get those through december, maybe early january. that's the way it looks. i want to ask you another thing though. there's a lot of talk, there's another piece to this that hasn't gotten its due attention. in the senate bill, if i'm not mistaken, by the middle of december, which is only a couple months away, there's supposed to be a budget, a budget for 2014 and longer. it's supposed to be negotiated with senator patty murray of washington state and house budget chairman paul ryan of wisconsin. mr. hoeven, there's talk of swapping sequestration for entitlement. do you believe that? do you actually think democrats will taken titlement reduction? >> well, that's the challenge. what they've said to date is they have to have tax increases to do it. that's a problem. we need to get the economy going. you have revenue from growth and combine that with mandatory spending reform, that's what's going to get us out of the hole. so that's the challenge we've got as we are in this negotiation. we want to get the government open and address the debt ceiling, but you have to get savings. >> i love your supply side analysis, senator hoeven, i truly do. i think the preponderant majority of them want the senate out and they want to put in a lot higher taxes, maybe up to $1 trillion of offset tax deductions on so hr called rich people. that's their deal. they have no intention of reforming. isn't that where we're going? >> that's why people like myself are working so hard to get some kind of process to get savings and reforms as part of a short term debt ceiling agreement. we have to keep the push on. >> just to clarify, sir, we appreciate your time. at this moment as the action moves back to the senate because the house is not voting, you haven't heard yet what, if any, changes will come to what was the original senate bill? you don't know about any changes in your caucus? >> not at this point. we're concerned about any further backing up of the equation. you've seen kind of the outline. we'll see where the negotiations go from this point. >> thank you, sir. senator john hoeven, nd ntorth dakota. we appreciate it. david callahan along with cnbc contributor of the american enterprise institute and ann coulter is still here. james, what do you think of all of this? >> i think we need to get to the process where the democrats are asking for tax increases as soon as possible. >> that's tonight, right? that's tonight. that's tonight. >> i want to hear it all. closing the loopholes, carried interest. let's get it all started right now. that's where all of this is leading to. terrified every time i hear about the budget gaps. >> at the end. day, what have we got? that's where this whole thing has ended up. stopping i think behind all of this, this is an odd thing, we started out with the ted cruz stuff, let's defund obama care, let's delay obama care, let's do this, that, and the other thing to obama care, they were going to vote on the car of out. it's about not cutting spending. it's about shredding the sequester, which is the single only pro growth thing we've already had. isn't that what the democrats are angling for. the best thing we've done and they want to end it. >> this whole crisis, this was not a great victory for the republican party. it's been a disaster, here's why. it has a lot of problems with women, with young people, with hispani hispanics. obama won the postgraduate vote by 16 percentage points. the u.s. chamber of commerce, business roundtable, wall street, these people are waking up realizing they have empowered these republican populists. i think that's going to be a big move away from -- >> your response, ann. >> -- republican party by business. >> republicans have historically been the populist party of the vast middle class. we are not the party of -- contrary you, larry. it's not the party of amnesty. >> not the party of immigration reform that helps the economy grow. >> amnesty, amnesty, amnesty. no, it's a disaster for african-americans, it's a disaster of the mexicans. great. let the chamber of commerce go and what's great is it shows they're willing to fight on obama care. this idea that we're going to trade the sequester to start arguing about entitlements? no. we lose on entitlements. the american public doesn't want to have it smaller. then you name could we raise the age for social security? no, they never want their entitlements cut. >> she's raising a good point. there are many who believe the entitlement cutting, let's leave the cost of living adjustment out, that's minor stuff, but the heavy medicare entitlement, changes in medicaid, it really is a root canal. it will hurt middle income, lower income people. maybe they shouldn't go there, stick to tax reform, which is pro growth. what do you think? >> i think they should go there on entitlement and i don't think they should just do it. >> they should just do it? >> no. very vigorous pro growth agenda. i don't know what anybody else thinks of this, but it's not for this, it's -- we'd be talking more about the failures. the number two story, number three story. we're talking about it. >> the catastrophic launch of obama care. >> yes, let's see from november 7th up until ted cruz launched his attack we weren't talking about obama care. >> we would be october 1st. obama care launch. >> it would be a one-day story. >> it would be a one day story. every day it's not working. this is the signature achievement. you can say no. it would be the signature achievement of obama's administration and it's not working day after day. >> mainstream media would be all over that. they totally want to report on the bad things happening to obama every day. i turn on cbs, abc, nbc. >> hour by hour, they haven't -- >> like benghazi because the mainstream media was all over benghazi. yes, i count on the mainstream media -- >> real fast, i have to get out. boom, boom, boom. 15 seconds. >> obama care is a done deal. obama's going to go down with fdr and lbj for getting this big signature social protection. >> america. >> larry, it's not incompatible with freedom. >> sound budgeting. >> and sound health. >> everybody stay put because at the moment it's not incompatible with the panel. we would need to know what happens if this whole thing continues to drag on, whether or not it would hurt the economy or maybe, contra, contra, smaller government actually helps the economy. we are going to ask the great art laper about that next up on "the kudlow report." the american dream is of a better future, a confident retirement. those dreams, there's just no way we're going to let them die. ♪ like they helped millions of others. by listening. planning. working one on one. that's what ameriprise financial does. that's what they can do with you. that's how ameriprise puts more within reach. ♪ that's how ameriprise puts more within reach. the world is changing faster than ever, creating new opportunities for those who stand ready to seize them. in a time when the biggest risk is playing it safe, we believe outshining the competition tomorrow requires challenging your business inside and out today. at cognizant, our flexible, collaborative approach helps forward-looking companies not only run better, but run different... to give your customers every reason to keep looking for you. so if you're ready to see opportunities and see them through, we say: let's get to work. because now more than ever, the future belongs to those who challenge the present. welcome back to "the cud row report." we're supposedly just a day away from hitting the debt ceiling. president obama and second lew want to scare us into thinking that would be a catastrophe and disaster, but we have the funds to service our debt. that's my point. here's some numbers. listen to this. serious stuff. in the first 11 months of 2013, average monthly revenues coming into the treasury, $225 billion. that's per month on average. interest expense? $21 million per average. that's a 200, roughly $200 billion surplus to pay the interest and service on the debt. how much cushion do they need? this isn't catastrophe. we will never default on our sovereign debt, never. not since alexander hamilton fixed it up in 1794 and i was there and i did it. by the way, he put gold behind the debt. let's talk to arthur laffer. politico is calling him the gop tax man. expert political panel is still with us. no one can get a word in edge wise. let me ask you the extreme. let's put the treasury thing aside. we will never default on the treasury. >> i agree. >> suppose the government shutdown continues and suppose we have periodic shutdowns in the next couple years, which i think we will, and suppose the government was smaller by 1/3, what would that mean to the economy? >> surely would not mean anything. i guess they cut government spending that would stimulate economic growth. i go back to milton friedman's line is government spending is taxation. government doesn't create resources it redistributes resources. for every person spending money on the government there's someone from whom they're taking that money. it clearly would be good for the u.s. to reduce government spending. i would like to see it as you described earlier, larry, where we do a tax reform first and then get economic growth going. once you get that economic growth going, it's much easier to reduce spending. that's what bill clinton had happen. he had a tremendously good economic -- he was able to cut spending a lot. >> there's no one talking growth. growth, growth, growth. >> growth is it. >> growth, by the way, lowers revenues. i mean, growth lowers welfare. growth does -- >> it does everything. >> growth promotes leverage. you take the bubbling get deficit down by tens of trillions of dollars. >> exactly. >> you have houses, jpmorgan, morgan stanley, they're all very pes sim miss city. if the shutdown lasts we'll lose 2% of gdp, americans will become greece. suppose we're shut down for another month. what happens? >> i remember when you were a little kid in the thomas jefferson days, larry, and, you know, honestly we've been to this barbecue many, many times. it's not going to hurt anything. this is a good, healthy discussion. i agree with ann totally that it's the discussion that should be had. what is the agenda for the u.s. going forward? if voters choose to throw republicans out, let them throw them out. this is their country, not our country. and if we lay out our plans and policies, the low rate flat tax spending restrantd, sound money, free trait, minimal regulations, they don't want it, it's their choice, they can live with the consequenc consequences. i think the consequences of a good, solid pro growth agenda would be wonderful. i think the democrats would join us as well. the democrats know this stuff is nonsense. they know that they should be subject to the laws they pass. >> do you think they -- >> they know that. >> hang on a second. do you think the democrats know? >> yes, totally. >> do you think they understand growth and less government and tax reform? >> no. that's why i've been enjoying your promoting growth, but it's kind of an academic discussion right now. i want to correct one thing art laffer said but he agreed with me so i hang on his every word. i did not say they throw them out, do whatever you have to do to win elections so we can enforce the growth policies. right now it's chitchat. >> i won't agree with that? >> arthur, your worst nightmare -- i know, you thought clinton did good. >> i thought clinton did a great job. >> clinton did a good job when he had a represent cap house and senate. >> john f. kennedy was the great. >> last supply side conservative pro american president that the democrats produced. all right. i really think that's fair. >> i do think so. >> anyway, i've got to get out of here, art. let me just ask you. let me just ask you. what about this deal that's coming down the road? republicans are going to give up budget cut squee questers. it seems obvious but that's a trap they're rolling into. >> i don't think so. i think they've done pretty well so far, that's my view of the world. nothing serious will happen as a result of all of this. they'll kwom to an agreement and they won't give up a sequester or go for tax increases. >> i agree. >> i think what the house proposed made sense. why shouldn't the democrats and everyone in the house and senate be under the same rules. why shouldn't they postpone the tax on medical devices for two years? why shouldn't they require people to prove tra their income is this -- >> i got yeah. >> sorry. thanks, larry. >> terrific stuff. ann's new book rolling out today "never trust a liberal" out now. now we go back to washington and speak with representatives frank polone and david schreikert. the clock is ticking. tomorrow night's debt ceiling deadline. hang with us. we'll be right back. for over 60,000 california foster children, extra curricular activities help provide a sense of identity and a path to success. joining the soccer team. getting help with math. going to prom. i want to learn to swim. it's hard to feel normal, when you can't do the normal things. to help, sleep train is collecting donations for the extra activities that, for most kids, are a normal part of growing up. not everyone can be a foster parent... but anyone can help a foster child. welcome back to "kudlow report." joining us, frank polone and dave schweikert. gentleman, you're tur good friends. i'm going to apologize from the beginning. we have breaking news from the house. i only have 90 seconds. i apologize to both of you friends. mr. frank polone, what do you make of it? the house is not going to vote. it's pushing it to the senate. what do you want? >> i want the speaker, speaker boehner to bring up a clean resolution and clean debt ceiling extension so we can, you know, open up the government, pay our bills and then, you know, we can negotiate whatever we have to negotiate. i think keeping the government shut and the threat of a default is devastating to the economy and is going to create loss of jobs and a lot of uncertainty in the economy. i don't think it's a good thing. >> dave schweikert, it's not going to be optimal. what mr. pallone just said, a clean bill on the cr and the debt, is that what's going to finally happen in the final vote in the house? >> i don't think so but i think it's going to be something close to that. you saw today we were getting close to a bill where we had our 217 votes. i think we're going to be up late tonight running around the house here and even reaching out to our senate colleagues to try to find out what the package needs to look like to have the votes necessary. >> do you expect -- i've got to go to dave -- i don't know. both of you real fast. dave, big changes in the senate. do you expect big changes in the senate or no? >> no. no, i don't, because at this point we need to find a way to just close this deal up. >> close it up. frank pallone, do you think they're going to make big changes, reid and mcconnell? >> no, they're very close. that's where it was. i was surprised the speaker didn't take it up. >> thank you, gentlemen. i appreciate it. i apologize. frank and dave, that's it for this evening's show. we'll be joined by special guest senator joe manchin tomorrow night. i was made to work. make my mark with pride. create moments of value. build character through quality. and earn the right to be called a classic. the lands' end no iron dress shirt. starting at 49 dollars. ♪ you have to let me know [ female announcer ] when sweet and salty come together, the taste is irresistible. sweet and salty nut bars by nature valley. nature at its most delicious. 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is symptomatic. he described those symptoms as mild. first lady melania trump says her symptoms are mild as well. meadows said they expect more information to be made public today from the president's medical team. person familiar with the matter tells nbc news that everybody is in a panic inside the white house about their own health. and as you see, meadows spoke to reporters this morning. even though he's had close contact with the president due his age and his weight, president trump is part of a cohort that is more susceptible to serious illness. the implications of that fact just can't be ignored. there is a possibility the president could address the american people in some form today. he may -- may need to be a priority by the white house in some form today. right now there's also a scramble at the highest levels of our government to figure out how widespread the virus is and how many folks have gotten it, made it very clear they fully expect more people to test positive as the situation unfolds. we've seen quite a few already. we learned late yesterday that one of the president's closest adviser hope hicks contracted the virus. she was reportedly experiencing symptoms around the time of tuesday's debate. then we heard that rnc chairman mcdaniel tested positive. republican senator mike li who was at the white house a few days ago has disclosed he's tested positive. he met with judge amy coney barrett. he was at a committee markup without a mask. in the days leading up to his diagnosis, the president and his staff often without masks have been all over the place. they've been at a presidential debate, numerous white house meetings, at the capitol, a rally in minnesota, a fundraiser in new jersey, you get the picture. contact tracing over thousands of miles. a number of white house officials have tested negative, including vice president pence, chief of staff meadows, secretary of state pompeo, attorney general barr, jared kushner, ivanka trump, among others. it's important to note that health experts recommend a 14-day quarantine for anyone exposed to the virus, regardless of whether they test negative. we also know that you can test negative the first couple of days with the virus and then it sometimes takes three or four days before tests can pick up the virus. moments ago, the biden campaign disclosed that biden has also tested negative as well. they said kamala harris tested negative both yesterday and today. so joining me now outside the white house my nbc news colleague geoff bennett. and an msnbc contributor and then of course from a medical perspective the dean of brown university school of public health. geoff, let me start with you. the president supposedly was going to do some work today, participate on a call. it's our understanding it's the vice president ended up participating on that call. so we have not -- we've not seen or heard from the president yet this morning or this afternoon. will that change in some form? >> at the moment, it's not clear that it will. and you're right, the only event that remained on the president's schedule after announced his positive covid diagnosis was this phone call there are conference call that the white house build is having to do with vulnerable seniors in relation to covid-19, a group of which the president is now a part. but, our team is told that the president asked vice president mike pence to conduct that call on his behalf, no specific reason was given. but the collective reporting of our white house team right now is that the mood in and around the west wing is one of panic. people are concerned, people are worried about their own health, about their own potential covid status given the ways in which many white house officials had extended, prolonged contact to president trump and hope hicks. and president trump as you see right there so often doesn't wear a mask. and he's explained why and he's suggested that he existed, lived and worked in this secure bubble where everyone around him is tested and yet, as we now know, it yielded a false sense of security. there is also a sense among some white house officials telling members of our team that they think that the president needs to be seen publicly. if only if it's waving from a window or waving from a balcony, that that would help calm markets. and there's still scrutiny right now, i think this will continue for something that mark meadows, the white house chief of staff said earlier today, that was that the white house knew of hope hicks' positive coronavirus status as marine one was taking off yesterday for the president's million dollar fundraiser, his private fundraiser in bedminster, new jersey. obvious question there is if they knew that someone in close contact to president trump had a positive covid diagnosis, why did they go forward with that fundraiser, chuck? >> and, geoff, do they have any good explanation? i mean, they've exposed members of the press, they've exposed those folks that came into contact with the president there. i mean, is there suddenly a lack of confidence in these abbott tests? we know they're not as accurate as the nasal swab tests. >> yeah. look, there is no good explanation. as yamiche knows, we're both in and out of that white house day after day, white house officials play fast and loose with the same cdc recommendations that this administration is telling americans to follow. they don't wear masks, even though it is impossible, as you well know, chuck, to socially distance in the west wing. yes, that's one of the reasons why white house officials, members of the press, people who have to go into that building each day and this holds true for the capitol too, are concerned about their health. and rightly so. >>. >> yamiche, you area nawere nam checked there so i'll go to you next. have you talked to sources in the white house? are they aware that the credibility -- that the fact that they have a credibility problem with a big chunk of the country during a moment like this, are they aware they probably need to be even more transparent than what would be called for under normal circumstances? >> it's a good question, and we're not sure we know the answer to that. we know, of course, that the white house has to be aware that they are complicated relationship with the truth, to put it lightly, complicates the fact that there are americans who simply do not believe the information that comes out of the white house. there are people openly questioning when did the president know, how did he find out, how many people have this virus in the white house, why did they put people at risk when they knew that hope hicks had tested positive? why he would get on that plane? there are questions about whether or not the president -- why he didn't share that information with the biden campaign. i have sources in the biden campaign telling me that they understood and learned about this news when every other american in the middle of the night in this chaotic way. there are a lot of questions for this white house. it's tough in the is why presidents need to have credibility, because when the nation is in a pandemic and you need to trust information, you want to turn to the white house and say that is the information they're giving us and as a result we can report on it and feel as though it's the right thing and it's the truth. in this case, this white house has just not built up that credibility and the president downplaying this virus over and over again also complicates this because it upends his relationship with the virus in and of itself. he's saying that he can protect americans, but here as the most protected american in the country, he could not protect himself, his wife, or his workplace. >> mike, with the biden campaign, it took till about noon today that we got confirmation that the former vice president had tested negative. what is the -- what are the daily protocols that the former vice president goes through when it comes to this virus right now? >> yeah, chuck. well, first of all, just an update on his schedule. if he was on time in a normal campaign day he would be arriving right around this time to deliver remarks on the economy just across the street from where i'm standing. the press pool right now, chuck, is gathered near the former vice president's home. we do expect him to still travel here. now, in terms of his traditional protocols this is a campaign that has always believed that good health and safety protocols are also good politics. but even if they prove not to be, it's the responsible thing to do. and so what we've seen since the pandemic really affected this country is in march it shut down the campaign. the campaign sent everyone home from their headquarters, the former vice president didn't really leave his house to appear publicly until memorial day, you'll remember. anybody who came into contact with the former vice president at his home had to be tested. for months there was very limited footprint of staffers who were actually in his home with him. more recently the full staff has had access to rapid testing. the press pool that has been now traveling with the former vice president on a daily basis also has that daily testing in order to be part of that traveling pool. and one thing to note as well, chuck, the kinds of events that the former vice president has been doing, despite the mocker thatmockery that's been present from the trump campaign, have all been in compliance with the local and state ordinances that apply to the locations he's traveling to. that was to go to be the case with the socially distant event here in michigan today. they're always going to make sure that his health and safety is first and foremost. but this is also a campaign that believes he has the responsibility to set a good example when one is not being set by the occupant of the white house right now, chuck. >> right. very quick, mike, do we have any reason to believe this event will not happen? >> no, chuck. in fact, i think one of the mythology but significance of these unforeseen events, the october surprise, they test the campaign's ability to adapt to a crisis circumstance. the biden campaign has seen this as a crisis circumstance all year, so while he may not focus on the economy in his remarks here, he will still focus on something he has been focused on every day for most of this year, which is the pandemic. and so little change in terms of the campaign message, chuck. >> all right. doctor, i want to start -- let's just go with the best you can help us out with on how to street the president right now. mild symptoms. look, we don't know what that means, we don't know if, you know, how they're defining mild. but he's got some symptoms. how would you be treating the president right now? >> yeah, so it's early in the disease course and it being mild obviously we're going to hope and pray that it stays mild and he gets better. but it is -- the window for having severe symptoms getting very, very sick is still several days away. and so i think he's going to need very careful monitoring to make sure that he's not clinically getting worse. there are some therapies that are basically month clonal antibodies, something that are going on in clinical trials to see if they could be useful in a situation like this. i would have a conversation with him as well as others about whether that was worth trying. but we don't have that right now as an approved therapy in this situation. so i suspect that he will not be getting that. there are no other treatments that he'll be eligible for at this moment. again, if he were to get sicker -- >> when would you use -- >> -- taken to the hospital, then there are other treatments. >> when would you use remdesivir, for instance? >> the authorization of remdesivir is for hospitalizations in the early disease course. there's some evidence of giving it earlier is potentially useful, so i think that's a conversation. i don't think of remdesivir as some major game changer that he absolutely needs it. but, the other therapy dexamethasone is for much more advanced disease. we hope that the president will not need that. but obviously if he were to get much more ill, then that would be another therapeutic option. it's mostly supportive care at this moment. >> all right. so right now he is in hefs fi-- finds out he tests positive, he's got mild symptoms. we know there's a window where things can get worse if they're going to get worse. what is the -- what is that window where if it doesn't get worse you would say, okay, he may have a mild case and he'll be on the road to recovery? is it five days? is it six days? what is the window here that we're looking at for -- while we monitor the president's health? >> yeah, there's a lot of variation here, chuck. you know, so i think certainly it's sort of probably in that five to eight-day range. meaning, this weekend, early next week is not out of the woods. but let's say by mid to later part of next week he's convened to be feel well, maybe mild symptoms, i think we'll feel more confident that he will end up having mild disease. but right now we just don't know and i think all we can do is hope and pray that he ends up having a mild case of this disease. >>. >> geoff bennett, do we know if the vice president's schedule has been changed? are they going to pull him from the campaign trail until they know what kind of shape the president is in? >> that's a good question for -- which i don't really have a good answer, i'll be honest with you about that. >> okay, i get that. >> that's one of our targets is to find out the degree to which the vice president will be quarantined. because even though he and the first lady had a negative test today, that's a good indicator, it's kind of final indicator and of course he'll need to be tested day after day after day. so the degree to which they are going to change their schedule and stay off the trail, that we don't yet know. >> and, yamiche, did kalee macha indianan kayleigh prove the press this morning or not? >> she said she did not know the hope hicks diagnosis and as a result when she went before a reporter she did not have that information. but i should note that she has been called out for having misled the reporter. so this goes back to the credibility question. she is saying this. we are taking her words at face value. but she has been someone who has said things that were not true. i think one of the other big things that we've been talking about is the president, of course, is 74 years old, mild symptoms, what are does that mean? what does that look like? and do people trust -- the american people in particular, do they trust when this white house or kayleigh comes out and says i didn't know about hope hicks, the president is not doing well, he's having mild symptoms, do the american people believe this white house? that's a critical question and

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counsel robert mueller. chief white house correspondent john roberts joins us live more on these changes. high john. >> a little more on that in a second. the white house right now, anthony scaramucci who was one of our contributors is supposed to be meeting with the president right now and supposed to be taking a job as the white house communications director. see you know who that person is, that's the person organizes and coordinates all of the intraadministration communication strategy, not the person who comes out before the podium every day, that remains a press secretary. the communications director will often go on television on sunday and that sort of thing. he's a fierce defender of the president's policies, the president likes him and believes he can throw a punch. we will find out later in the day what's going on with this meeting, which apparently was supposed to be taking place this hour. not to the russia investigation. the president has shaken up his legal team a little bit. mark geraldo, the spokesman has resigned. mark cast a wits who is lead attorney has taken a little bit more of a back seat. john dowd is going to be the attorney out front from the outside and then ty cobb will be taking the lead inside the white house and the president's team and the president himself building a case of a lot of conflict of interests around the molar probe beginning with rod rosenstein who is the deputy attorney general. the president is saying that rosenstein has a conflict of interest because he recommended that comey be replaced, and then turned around and appointed special counsel into the firing of comey and robert mueller has been hiring in avera for attorneys who have contributed to democrats, including hillary clinton. the meal or probe has also branched out to include the president's finances. in that "new york times" interview the other day, the president warned mueller against branching out beyond russia, cautioning him to limit this scope to russia which is where it looks like it is right now. kellyanne conway ring in on that on fox and friends this morning, listen here. >> this is just a witch hunt, it's all a hoax, and now they're going in all types of directions. the information you just shared his information america should have. americans should know about people's political motivations. these weren't minor donations that i said before, these were significant donations by members of that team. they clearly one of the other person to win. >> clearly one of the other person to win, which is part of the case of conflict of interes interest. adam schiff took aim at the president's statement and said that if mueller strayed outside the bounds of the investigation, that would be a redline for the president. "i have every confidence that mueller will not respond to the president and his team's less than subtle efforts to constrain his probe and it will be up to congress to ensure that the necessary resources and independence to carry out his investigation." the white house reiterated yesterday that the president has no intention of firing robert mueller. something else that's happening at the white house today, the vice president will be eating with a number of conservative groups about health care. fox news has learned that these conservative groups, like the american conservative union and others, will be scoring the vote at next week's procedural vote on health care in the senate. they are letting these members know that however you vote next week on this health care bill, it's going to affect your record with us. if you got a 100% record any vote against this thing, you'll get taken down a peg. >> heather: getting them on the record. john roberts, thank you. ♪ >> jon: let's talk about, what else, health care. republican leaders is still hope to vote next week on a senate bill that would dismantle obamacare after failing to garner enough support this week, but it's unclear exactly what they'll be voting on. there are currently two options on the table, a repeal only bill or an updated version of the senate's repeal and replace legislation. neither one of them seems to have the votes to pass. >> we cannot get the commitment we made to the american people to repeal and replace obamacare on the spigot on the bill. >> jon: glenn hall is editor for "the wall street journal" and he knows everything that's going to happen. will there be a vote next week? >> better get out the crystal ball. the question is, is it the time? has mcconnell reached the end of his line and force the hand? that's what it takes to get the vote. the important thing to know if there is a vote, it's only about the motion to proceed. it sounds procedural, but this is about pushing the house forward. there's a lot of negotiating still to be done and john mccain and his health issues take one of two no votes out of the equation. >> jon: the other senators who expressed a lot of reservations about this process have not really changed their position. rand paul, ted cruz, mike li, shelly more capital, susan collins, they all have said they have solid concerns about the way forward. >> on the rand paul front, he said i'm willing to proceed to get this on the floor if i get a promise that we'll take up repeal only as an option. what mitch mcconnell really needs to do here if he wants to move forward is get the bill on the floor and allow those amendments to see if the bill take shape. if they do that, nobody really knows what they're going to be voting on. >> jon: that's potentially all kinds of peril that comes with offering those amendments and decorating this bill with all kinds of strings and money. >> that's happening anyway. there's a dance going on now, what would it take to get you win? they are trying to figure out how to shape a bill that could get 50 senators to approve because they can afford to lose -- they can get a pass about 50. >> jon: they're not even talking about getting democrats on board with this thing. >> no, the only way democrats will come on board as if they can adjust obamacare. >> jon: you and i are confused about what they'll be voting on, so are some of the senators. here's jerry moran of kansas. >> i don't think this bill adequately repeals the affordable care act and i don't think the replacement is the appropriate replacement. it's a pretty high threshold and would be pretty substantially different. >> we democrats don't know what our republican friends are planning to vote on next week. i'll bet many republicans don't know yet either. what we do know is that a $200 billion fund tacked on to a bill that would got medicaid and other services by well over $1 trillion is like putting an old band-aid on a bullet wound. >> jon: i think he's referring to some of the money that mitch mcconnell allotted to help states suffering opioid addiction problems. there's 45 billion for that. some of the tax increases would maintain mcconnell's bill. >> they still see this as a repeal and replace even though two pieces made to be saved, is not saving the whole package. some of that money we were just talking about may also be related to a movement out there to put some money from those taxes that are remaining back for the people who transition from medicaid onto a private insurance program. that's a thing that's being floated right now to try and win people over. >> jon: they say they'll vote on tuesday, we'll see if it happens. one hall from "the wall street journal," thank you. >> heather: let's talk a little bit more about taxes. house speaker paul ryan visited a shoe factory in massachusetts and ryan called for an overhaul. saying tax reform would boost economic growth and businesses. peter doocy joins us now from boston on that. >> whether obamacare ends up getting repealed or not, the next item on the republicans to-do list is tax reform and speaker of the house paul ryan told us last night here in massachusetts, it is going to happen in the fall. >> we can still do tax reform regardless of what happens. we've already put in a contingency plan for that, so we will do tax reform no matter what happens with respect to any other issue like health care reform because we know we have to do tax reform and our tax reform bill is unaffected by the health care bill. >> ryan's argument for tax reform is all about making the u.s. more competitive with the rest of the industrialized world. the speaker toured a new factory in lawrence where the owner said they could build more factories here with a friendlier tax code. he has struggled with moving their big legislative items. i asked ryan to name one big accomplishment from this session and he said, it's been a lot more than that. >> it you are only giving me one? >> what is the one big one? >> one of the biggest ones was overhauling the administration. remember those awful waiting lists? the veterans weren't getting their care, we passed the law over on the entire veterans administration. we took 14 obama era regulations and brought a bill to the floor of the house and those have now gone into law. >> even though it's been six months without repealing and replacing obamacare or reforming the tax code, ryan insists they are still on track in congress to do that by the end of this year. >> heather: all right, we'll see if that happens. peter doocy forest live in boston, thank you. >> jon: with health care dominating capitol hill and the headlines for weeks, have the mainstream media given this story fair coverage? our media panel weighs in on that next. plus a california wildfire destroying dozens of homes as it blazes a path of destruction near a famous town. >> right now, the place has become a ghost town. we want to keep everybody safe and make sure the air quality is good so it's best to keep them out of here while the services do what they need to do to save us. you don't let anything keep you sidelined. that's why you drink ensure. with 9 grams of protein and 26 vitamins and minerals. for the strength and energy to get back to doing... ...what you love. ensure. always be you. >> heather: happening right now, cruising california working around the clock to control a massive wildfire forcing thousands to flee a small town near yosemite national park. fire officials confirming that this wildfire has destroyed 58 homes and other buildings in its path. mandatory evacuation orders remain in place. the flames coming within a half-mile of that historic town. governor jerry brown declaring an emergency to try and get some additional resources to battle the fire which is only about 15% contained at this point. ♪ >> jon: as we discussed at the top of the hour, senate republicans now looking for a plan c after the revised health care bill wins a enough support to even begin debate. one option is to simply repeal obamacare now and replace it later. some political analysts sharply criticizing that idea, even calling it stupid. earlier this week, the president suggested just letting obamacare collapse. >> let obamacare fail, it will be a lot easier. i think we're probably in that position where we should just let obamacare failed. we are not going to own it, i'm not going to own it. republicans are not going to own it. >> jon: lynn speed and rich lowry. rich, from your standpoint, as an editor of a conservative publication, what do you think of this whole repeal and replace effort? >> i think in the process in congress has been atrocious. no one has made the public case, not paul ryan, not mitch mcconnell, not donald trump. all that said, the coverage that's been uniformly negative from the beginning, it's exaggerated and put a lot of these reforms in the worst possible light. you can feel it, reporters are so eager to write the story that this thing failed and republicans are headed towards the dustbin. >> jon: it is true, lynn, that changes are collapsing, cream hymns are going to the roof, but that doesn't seem to get a whole lot of attention in the coverage of the attempts to repeal and replace it. >> let's take a slice of the spirit where we are now in this story is that the republican-controlled house, republican-controlled senate, and the republican white house has not repealed or replaced obamacare. i think the media is covering an ongoing story with the current chapter being how within the republican party, there is a lot of debate about what the steps forward are and what can be don done. that is the story unfolding, that's the story being covered. if you are looking and we're talking about the most current developments, that's where the story is and i don't know anyone who is reporting on the state of play and reporting how hard it is for the republican house or republican senate to come up with a game plan to get the votes they need in the house and senate incentive to the white house. >> jon: here's a sampling of some of the coverage of this week from a couple of media analysts, including our own charles krauthammer. listen. >> he's not going to own it, which is strange because when the house version passed this spring, the president was eager to moan that one. he threw a big victory celebration of the rose garden. >> this is an epic fail, this is historic. this is seven years down the drain. >> jon: one of the things that gets talked about a lot is that millions of people at the cbo estimates would be caps off the roles of the insured if these various plans were put forward, but according to the irs, there were six and a half million people who opted to pay the fines rather than try to pay for obamacare. >> this is a big problem with the coverage. it's been catastrophically negative. you see the numbers from the cbo, 22 million will lose their insurance, 32 million will lose their insurance, it's lost in the coverage that a lot of those people are going to voluntarily drop their coverage if they are coerced by the state. the medicaid reform, the per capita funding formula. if you read the coverage, it's going to end medicaid as we know it, you would never know that that was an idea proposed by bill clinton to save medicaid and put it on a more sustainable footing. the house bill, they gave states the ability another way to care for people with pre-existing conditions besides the obamacare regulation. the coverage has been uniformly negative. it's gone from completely hostile to repealing and replacing obamacare. >> jon: i come back to the notion that these exchanges are going south and the premiums are going north and that doesn't seem -- there's all of us coverage of the terrible future that could ensue if we change this thing or if we throw it out, but nobody is covering the tragic present. >> this is a very big subject and i know we don't have a lot of time, but there are stories about the pluses and minuses and failures of obamacare. the democrats have been candid in saying there are things that need to be done, but i hope people out there know that when you talk about funding to the states and this is personal for people. if you have pre-existing -- we don't know what the states would do and that's part of the discussion about coverage. >> jon: the states would know better. lynn sweet, rich lowry, thank you both. >> heather: still to come, the tragic death of a university of virginia student after being thrown into a north korean prison has a trump administration making a rare move to keep americans safe. we'll have that story and more, stay with us after the break. choose from the is turbo, es 350 or nx turbo for $299 a month for 36 months if you lease now. experience amazing at your lexus dealer. but prevagen helps your brain with an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory. prevagen. the name to remember. your insurance on time. tap one little bumper, and up go your rates. what good is having insurance if you get punished for using it? news flash: nobody's perfect. for drivers with accident forgiveness, liberty mutual won't raise your rates due to your first accident. switch and you could save $782 on home and auto insurance. call for a free quote today. liberty stands with you™ liberty mutual insurance. >> jon: right now, the trump administration reportedly is set to ban americans from traveling to north korea. the secretary of state can impose travel restrictions to certain nations where there is an immediate danger to americans. the ban takes effect 30 days after its officially announced, but it's unclear when that will be. the administration has been considering a move since the death of 22-year-old university student otto warmbier last month. he died after falling into a coma while and a prison in north korea. >> heather: police in minneapolis are reevaluating their body camera policies after the shooting death of an unarmed woman saturday night. justine damon was shot by police after reporting a possible sexual assault near her home. her family is demanding officers, officer noor is not talking. >> he's still not talking and an attorney representing the family of justine damon says clearly this is an improper use of deadly force. the minneapolis police chief back from vacation is not standing behind the officer who fired that deadly shot. janee harteau said clearly that justine did not have to die. >> i believe the actions go against who we are as a department, how a train, and the expectations we have for our officers. these were the actions and judgments of one individual. i want to assure justine's family, our community, and those in australia that i will do everything in my power to make sure due process is followed and justice is served. >> last saturday night, justine damond and called 911 for a possible sexual assault. the only information we have about what may have led up to the shooting comes from a statement made by the officer driving the car. he said there were loud noises prior to justine approaching the driver side door. officer mohamed noor fired from the passenger seat, killing justine damond. noor has not yet given a statement. part of the demonstrators are demanding is that he be fired if he doesn't explain why he fired his weapon. hundreds of marchers gathered in the neighborhood where she lived and that dashcam footage be released, although previous statements are that nothing was captured by the dashcam spirit body cameras were worn by the officers come aboard an activity to record. demand is from australia, her relatives are asking for her remains to be there. >> heather: thank you for joining us. >> jon: there is chaos on a greek island filled with tourists as a powerful earthquake hits coasts, causing a building to collapse. benjamin hall with a lab report ahead. plus o.j. simpson all smiles yesterday after he was granted parole in nevada. what's in store for the disgraced football star? our legal panel weighs in. >> he obviously was very emotional if you look at the cameras. he was very emotional. noo text "blades" to gillette on demand text to reorder blades... ...and get $3 off your first order with gillette on demand. ♪ >> heather: o.j. simpson could walk out of a prison a free man just a few months from now after nine years behind bars after eight nevada parole board agreed unanimously to his release yesterday after serving time for armed robbery and kidnapping. >> the poor state of the reasons for granting parole including, mr. simpson had no prior or minimal criminal conviction history, he had a positive institutional record, he had participated in programs specific to addressing behavior that led to his incarceration, he has a stable release plans and community and family support and the victim in the case testified in support of mr. simpson's release. >> heather: here to weigh in on what happens next, fred tc and tom kenaf, thank you both for joining us. want to miss parole hearing yesterday, you can and but think back to the televised coverage of the trial back in 1995, the murder trial of nicole brown simpson and ron goldman. of course, he was acquitted of those charges, a surprise to a lot of folks. but this time around, it wasn't a surprise to a lot of folks but he would be walking free and he was granted parole. fred, were you surprised? >> no, i wasn't surprised, but very disappointed. the parole hearing can include things he did in the past, but it can include his statements. for the man to stand in from the parole board and said he is lead a life free of conflict when he almost decapitated his wife's head when he killed her when his two children were asleep upstairs, and he tried to beat her with a baseball bat. when he said he never pulled a weapon on a person, he didn't do exactly what the parole board told him to, his statements and his conduct, and his arguing was not fact of someone who should be assimilated back into societ society. >> heather: amongst some other things, the commissioners said they can't hold someone in prison just because they expressed remorse. >> i understand there are a lot of people who don't like the outcome, but legally, it was a sound outcome. the nevada parole and states throughout the country have a risk assessment guideline that they use. those risk assessment guidelines do take into account prior criminal history, but it speaks to criminal convictions and the reality is, o.j. simpson, again, like it or not, wasn't convicted of the simpson and golden murderers. it's not something that legally the parole board can consider. that factor, prior criminal history actually was a mitigating factor and o.j. simpson's parole hearing yesterday because a fact of the matter is, he does not have a prior criminal history and using that term the way the parole board used it means you do not have any prior convictions. >> heather: wasn't he convicted of beating up nicole brown? they responded to his home multiple times i think it was in 1989 specifically when she was hospitalized. >> he wasn't convicted criminally. >> under the law, he doesn't have a prior criminal conviction to that. the question is whether were not he should be let back into society and his comments, not his conduct, but his comments in his conduct yesterday are white, from my perspective, are compelling reasons not to let him back in, to say that he's lived a life free from conflict, not true. to argue that he didn't know that guns are being used in the underlying crime, not true. ed was a lie, he continuously lied. >> heather: on top of that, what about not following through on some of the promises that he made during his first parole hearing? i know there were a couple of things that he was told to do, one of those being in alcoholics anonymous meeting which he did not do. >> that was a legitimate factor and i think that brought in some points, but you have to juxtapose that with all of the favorable factors he had going for him. it was undisputed that this guy was a model prisoner. he has a strong family and you can argue community support, the victim of the crime testified very strongly in his favor. he's 70 years old at this point, so part of what the parole board is looking at is his risk to reoffend. with respect to those comments, first of all, the parole board does have guidelines regarding remorse. it's only a factor to be considered when the parolee did or did not express at the time of arrest. one thing no one is mentioning here is o.j. simpson did not plead guilty. if he had and under oath admitted to the crimes, and they said something differing, he'd be in a different situation, but he went to trial, the trial ended, in the board does consider his conduct relative to the other participants of the crime. the reality is, the prosecution's theory in this case was not that he was the one who brandished the gun. yes, he was legally found guilty, it was his codefendants. >> heather: regardless at this point, i'll let you make a comment about this, they've made their decision, all four unanimously. what happens next? he's heading to florida, a florida specifically would benefit him and that they have the homestead exemption, correc correct? >> yes, but here's the thing. to answer your question, and my opinion, he's not going to be able to stay out on parole. i'll bet you lunch my favorite monster stomach to my stomach this man cannot help himself. he will ultimately become involved. i wish she doesn't, i hope he goes off in the twilight of his life with his children, but i'm not optimistic. >> heather: what about you, tom question rick >> i don't disagree. i don't think he'll hold up a liquor store, but he'll consort with some of the unsavory people he used to. >> heather: he make it get into reality tv. >> i find that obnoxious, i'm sorry. that's offensive. >> heather: thanks for joining us, have a great weekend. >> jon: breaking now, a powerful earthquake strikes off the coast of greece and turkey overnight. the 6.7 magnitude quake killing two people, injuring hundreds more when a building collapsed on the island coast. benjamin hall live from london with more. benjamin? >> hi, john. this scale is unprecedented at 6.7. we are still seeing numerous aftershocks. we are counting over 160 at this point, meaning many people they are still stranded. as you say, two tourists were killed, one from sweden, one from turkey after a wall collapsed onto a bar and hundreds of others were injured along this coastline. the e.u. has offered emergency equipment, satellite imagery, and more support to deal with the aftermath. drones show the extent of the damage were much of the town square, the port, the archaeological sites and streets were affected leaving large cracks, stretching for miles both their end and turkey. the quake hit at around 1:30 in the morning on friday, 6 miles deep sending people streaming out of bars, cafes, and hotels onto the street. thousands spent the night sleeping outside in fear of more aftershocks. tourists have now spoken out about the rodeo. >> all of a sudden, it's on like a train was going right through the room. i told my son, looks like an earthquake, let's get the hill out of here. >> hundreds of people are now stranded on the island, but after save you checks on the runway are carried out. there were small tidal waves record around two feet. the real sides of this damage still ascertaining. >> jon: benjamin hall, thank you. >> heather: some new information is you're going to say, and to the deadly collision between a navy destroyer and a cargo ship, as you remember, we reported on this. who investigators say is likely to blame, we'll talk about that up next. and mike pompeo says that vladimir putin has no intention of leaving syria and will continue to meddle in u.s. affairs. general jack keane here to weigh in on our options for handling the russians. >> they love warm water naval port and they love to stick it to america. you don't let anything keep you sidelined. that's why you drink ensure. with 9 grams of protein and 26 vitamins and minerals. for the strength and energy to get back to doing... ...what you love. ensure. always be you. i'm the one clocking in... when you're clocking out. sensing your every move and automatically adjusting to help you stay effortlessly comfortable. there. i can even warm these to help you fall asleep faster. does your bed do that? oh. i don't actually talk. though i'm smart enough to. i'm the new sleep number 360 smart bed. let's meet at a sleep number store. >> jon: new information on the deadly crash involving a cargo ship and a u.s. navy destroyer of the coast of japan. u.s. officials told fox news that the crew of the uss fitzgerald made mistakes leading to the collision. they say to navigation teams on the ship failed to speak out about the possible risks. a cargo vessel ripped a hole in the side of the fitzgerald killing seven sailors who are trapped in flooded compartments. >> heather: it is complicated, that is how cia director mike pompeo was describing u.s.-russian relations. pompeo was speaking yesterday. he expressed hope for improved relations with moscow, but also saying that russia continues to be a thorn in our side here at home and in syria. >> they love warm water naval port on the logistics to americ america. i'm sort of kidding, but i think they find any place that they can make our lives more difficult and they find it something that's useful to them. from an intelligence perspective, it's clear they have intentions of remaining there. >> heather: joining me now is a retired four-star general jack keane, he's the chairman of the institute for the study of war and a fox news military analyst. thank you so much for joining us. >> glad to be here. >> heather: is a right? to the left to stick it to americans? >> oh, yes. when you think about it from a strategy perspective, we are in a new era here. it's a restart is of great power competition and we've been there before obviously during the cold war. russia, when it looks at the united states, they see us as their number one adversary and why is that? because we have kept at the international order in place for seven decades and it has largely kept the world stable. no world wars, no major, major wars that killed hundreds of thousands and millions of people. the russians believe that is no longer in their interest and look at how aggressive they have been. they've moved into georgia, they've annexed crimea, there in eastern ukraine, they've conducted their first military intervention in 35 years into syria, they're trying to replace the united states as the most influential out of region country in the middle east and their coupled with the iranians. we don't really have a very good strategy to deal with it. >> heather: that being said, explained to me this decision that apparently has come about regarding the cia, covert cia's program to arm the anti-rebels in syria. it would seem that would benefit the russians and iran. >> it certainly does. i'm mystified by the decision. the group that we've been eating with missiles is the only group in syria that wants democracy in that country and they've been fighting for that and giving up their lives and their families in the pursuit. the reality is is when we pull back from them, their morale is going to go down, they'll lose influence and power among the opposition forces, some of them joined the radical groups, and clearly, they're going to be less effective in dealing with the regime and the iranians. it doesn't make any sense why we would do something like that and it was because the russians wanted it. >> heather: we've said all along that we do not want the assad regime to remain in power and this would benefit that goal, which is the goal that the russians have always said that they back keeping him and power. do you think this is something that was discussed between president trump and president putin at the g20 summit, therefore coming to this conclusion? >> i have no idea. we don't know the details of our discussion, but the strategy that we have, that is not a strategy and asada staying in power indefinitely. the iranian and russian intervention in syria and particularly, most recently the russian intervention has guaranteed a sawed to stay in power. we need a strategy. they occupy the western part of syria, they want to move east and the iranians are driving us to occupy the eastern part of syria. we should not let that happen. that would be a strategy that would make some sense, containment that have right now. >> heather: hears with the cia director pompeo had to say about finding some area where we can work together with the russians in syria. >> we certainly are trying to find places where we can work alongside the russians, but we don't have the same set of interests there. from an intelligence perspective, we are staring at the places we can find to achieve american outcomes. things that are in our country's best interest and not theirs. when the decision was made to allow russians to enter into syria now coming on for years ago, fundamentally changing the landscape, it's been worse for the syrian people. >> heather: so quickly, where would that area of common concern be? >> there's not much of it. the de-escalation zone that we just pieced together, the syrians have already fired, so the cease-fire has been broken. we can't confirm whether russians have used any airpower. the ground forces are still in the de-escalation zone and they're still trampling on the syrian people. so yes, we can make deals with the russians, but here we know. they don't keep the deals, they're liars, thugs, and killers, and we have to be clear about dealing with them. i'm sure director pompeo, he's very clear about the russians, he knows what he's dealing with. >> heather: with all of us are merely following his comments, there is words today that the russians flew jets into syria for the first time into a new air base. general cain, thank you so much for joining us. >> jon: the summer continues to sizzle with hot and unpredictable weather. will the heat wave ever end? janice dean joins us next. show me used trucks with one owner. pretty cool. [laughs] ah... ahem... show me the carfax. start your used car search at the all-new carfax.com. when did you see the sign? when i needed to create a better visitor experience. improve our workflow. attract new customers. that's when fastsigns recommended fleet graphics. yeah! now business is rolling in. get started at fastsigns.com. >> harris: coming up, president trump legal team looking into the background of special counsel miller's tires. what they are concerned about possible reactions. >> sandra: you can forgive the democrats for wanting to get a new message after a stunning defeat, but you can't forgive them, but the eyebrows being raised with a new slogan that sounds awfully close to a popular commercial. as the critters in the impaired? >> harris: all that plus our #oneluckyguy with an accent, we can't wait. it's happy hour friday. >> jon: the summer, we are seeing lots of extreme weather. a heat wave growing across the country, turning dangerous and some areas with temperatures topping 100 degrees. also thunderstorms and flooding are expected through the weekend and many parts of the u.s. janice dean joins us with more peer that kind of go together. you have them a cheat, you get thunderstorms. >> you are correct. we should be by a pool somewher somewhere. with a nice drink with a fancy umbrella. let's take a look at your current temperatures. it is hot outside and we do have heat advisories and places. dangerous heat mixtures, watch the elderly and your kids and bring your pets inside because the temperatures are hot and the humidity makes it feel even worse than that. oppressive heat. well over 100 degrees is what it feels like across the mississippi river valley, working its way up towards the mid-atlantic and the northeast. we have heat advisories for many folks, watches and warnings from the northern plains towards the gulf coast and then the mid-atlantic and the northeast. dangerous heat in-store. high pressure anchored across the central u.s. and around that high pressure, that's where we are seeing a potential for strong and severe thunderstorms. as we get into the afternoon hours today and to the overnight and into tomorrow, we are watching the upper midwest, the great lakes region where we could see some strong winds, certainly some hail, isolated tornadoes and heavy downpours. severe threat here through this evening especially through the areas we see shaded yellow and orange. again, it could be a watch or warning in your area, know what to do and nowhere to go. as we head into saturday expanding towards the mid-atlantic and the northeast again. the moral of the story is summer time, make sure you are cool and indoors and if you are in an area that could see some showers and thunderstorms, go inside. >> jon: good time to go to the rocky mountains. >> you are a big fan of the rocky mountains. >> jon: thanks, see you. >> heather: hot and steamy. new in the next hour of "happening now" for you, an executive order denying federal funds to sanctuary cities dealt another legal blow emma will take a look at the judges ruling in the administration's next move. plus, some new questions about jeff sessions future after the president's harsh criticism of the attorney general, but now republicans senators are rallying around jeff sessions, what that could mean for the white house. this is the new new york. we are building new airports all across the state. new roads and bridges. new mass transit. new business friendly environment. new lower taxes. and new university partnerships to grow the businesses of tomorrow today. learn more at esd.ny.gov if you could book a flight, then add a hotel, or car, or activity in one place and save, where would you go? ♪ expedia. >> jon: heather and i will be back in one hour, "outnumbered" starts now. ♪ >> sandra: oh, yeah, it's friday and it is to be. i'm tender smith coming here today, harris faulkner and she is dancing to this friday. melissa francis, also from fbn, the anchor of the intelligence report, trish regan is here in today's #oneluckyguy, the host of the next revolution and the former director of strategy for the prime minister david cameron, steve hilton ends here and we are so glad that you are a number today. >> steve: it's wonderful to be here. i'm very excited half of you have been out to join us on the next revolution. >> harris: let's do that

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