Pieces power lunch starts right now welcome to power lunch. Stocks extending the weeks gains and could ends up with a positive month across the board. Health care the best performing sector and financials and telecom the biggest laggards refineries shut down for extended periods in texas in the wake of harvey gasoline continues to spike as well on that supply disruption campbells soup falling as earnings disappoint and costco in the green after reporting a 6 jump in sales and lands end sinking on an etf miss down nearly 8 . Lets get you caught up on the latest headlines texas officials reporting more than 37,000 homes sustained major damage and 7,000 destroyed by the storm u. S. Navy sending two trips to provide humanitarian aid outside of the houston area, the city of beaumont lost its water supply as a result theres 180 million in damage to public property across the gulf coast counties just so far. The Vice President saying moments ago that President Trump will return to texas on saturday flooding from Hurricane Harvey spiking currently causing some issues with a power plant about 25 miles northwest of houston area and thats where we find scott cohen reported on this Alarming Development at the chemical factory what can you tell us . Reporter well, we are still monitoring this as you said, were about 20, 30 miles outside of houston in the town of crosby as you can see, this is as close as they are allowing us to get to the arkema Chemical Plant what happened is that plant, that area flooded. They got a whole bunch of water which well show in a moment this is the view from above. What happens is when the power goes out the refrigeration goes out. If some of these chemicals and peroxides are not refridge rated, they will decompose and catch fire and potentially ultimately explode a couple of tanks have ruptured and all they can do, you look at the view from above. All they can do is let the fires burn themselves out. There were nine refridge rate ated containers in anticipation of the flooding, eight of the nine at last report have failed. Ninth is likely to go any time soon that makes it inevitable that these chemicals are going to go up in flames potentially explode and thats why they are keeping us a mile and a half away and residents out as well. Heres the problem, its water, 6 feet of water they got inside that plant and in and around that plant they say thats never happened before it took out the power and took out the backup generators and thats why we find ourselves in the spot were in. Now, if you think that situation is bad, take a look at pictures from port arthur, texas, 60 miles east of me where they are still performing rescues and dealing with flooding and bringing people out of their homes in the flooded areas beaumont, texas has no water, no municipal water because of Flooding Issues and its not just a human toll. Heres the situation with the refiners, weve been talking about this all day, what its doing to gasoline prices and throughout all of the Refined Products complex the motiva plant is the largest in the u. S. , in port arthur. 603,000 barrels a day. It is out. Baytown, texas, port arthur, deerpark, all of these other refineries are out and those are just the ones that are shut down theres reduced capacity elsewhere. That motiva refinery, again, the largest in the u. S. , they are saying it could be two weeks and some are saying it might be longer before that gets online the supply and demand impact is definitely playing itself out. Those pictures you show us, scott, they continue to as stound even five days later. Good to have you now to cnbcs exclusive interview with Steve Mnuchin joining us live from washington with the highlights, hey, steve. Good afternoon, Steven Mnuchin in an exclusive interview saying the tax plan cometh despite criticism that a plan without detail. It will be released in the next few weeks. Originally our goal had been august unfortunately things got delayed a bit. But were on a track to get this done by the end of the year. So youre going to see the details come out later this month. Its going to go through a Committee Process and we expect the house and senate will get this to the president to sign this year and couldnt be more excited about the progress made. Aiming for a revenue neutral bill that wont increase the deficit but that depends on how much growth the joint Tax Committee determines tax cuts will generate. That is dynamic scoring. I asked him whether the administration already conceded it couldnt get to that 15 goal for Corporate Taxes because of how much it would increase the deficit. The president made very clear that that was our goal during the campaign, when we came out with a plan earlier in the administration, we said that our objective is to get down to 15 , wherever we end up the objective is to get a competitive business rate. Maybe a little wiggle room there. The debt ceiling still on track but the aid for Hurricane Harvey could have an impact on the debt ceiling. He is working with the Federal Reserve on and other regulators on financial Regulatory Reform not a whole much different as indicated by Janet Yellens speech and not decided on Harriet Tubman being on the 20 bill speaking of dollars, mnuchin backs the idea of a market determined dollar. Didnt talk it up or talk it down over the long term a strong dollar reflects Market Sentiment about a countrys underlying economics. Steve, i really miss the treasury secretary repeateding a statement about the policy of the strong dollar even though they dont believe it you know, michelle, i want to share a personal reporters notebook this interview provided me with a sense of normalcy i havent experienced in the political process in seven months. You sit town down with a politician and spar over details he doesnt want to provide the way so insane the last several months doing that was the first bit of normalcy since the election. Thats interesting. But the point on the dollar, thats a dramatic change historically the treasury secretary says its the same sentence over and over again for decades, the policy is to have a strong dollar. I thought about that and it is a little bit of a different twist but leads you to the same place. Hes not talking about whether or not he has a preference ultimately saying well have a strong dollar because the u. S. Underlying economics will be strong but hes not promoting it either way. I think they are kind of quietly a little bit happy with the weaker dollar right now. Dont seem to be talking it up as you know the president has not felt any restraint at all in talking about Interest Rates or the dollar. The president has said he wants a weaker dollar its better for trade something the treasury secretary did echo a little bit. Well talk about it more in terms of tax reform, what is beneficial to the economy and what is most realistic lets bring in austengoolsbee and diane swonk, founder and ceo of ds economics welcome to both of you we heard the treasury secretary leaning on congress for the fine print. What do you make of that, austen i thought the most news worthy thing in steves interview, it seemed like the secretary of treasury almost said the opposite. Theyve been saying and when donald trump gave this speech that was all generalitiy ies ano specifics, we thought they were saying lets let congress do it. You heard mnuchin say they are going to produce a plan. Thats very risky because the chair persons, chair men in the senate and in the house, they jealously guard their turf and if the Administration Says we want you to get rid of the following deductions and loopholes, something, i think theres going to be serious blowback he didnt say exactly what the nonnegotiables are for the white house. And did say the house and senate are currently socializing the plan with their members. What do you take that to mean, exactly . Im hearing something completely different out of washington weve heard the rhetoric regarding instead of reform go to tax cut frankly thats the only thing you can do quingly is tax cuts, not reform already the lobbyists are stacking up in washington. Any time theres uncertainty they flood washington and tax reform is something they are already staking out because they dont know whats going on and theres a reason it took three years back in 1986 earn started ten years before that because its hard. Reform is hard, tax cuts are easy what im hearing out of washington and even paul ryan has said they are looking at tax cuts that was a shift in his rhetoric as well, something that weve heard many people who watch the budget and are worried about the widening budget deficit, this is now really devofled to a tax cut argument, not a reform argument as good as mnuchin was messaging, theres a huge gap between people complaining that they dont know who to talk to in the administration. Mnuchin has been working with people but on other side there are people who dont know how to get the messaging on the same page as austan put, theres a real danger in studying the agenda and not having congress on the same page and having to cut deals. If theres one singular priority to get the competitive business tax rate and we heard the secretary say over and over again even as he declined to commit to the 15 magic rate that the president continues to talk about, what do you think is a competitive tax rate and whats actually realistic here austan and i something more realistic is more like 20 to 25 then youve got to eliminate deductions this is not easy to get there. Revenue neutral is not just were going to grow the economy like crazy and just because of tax cuts thats not how it works. We need revenue neutrality and need to think of tax reform in the eco system of something. Austan underscored infrastructure investment, not even being talked about right now. What do you think the competitive rate is . Look, it all depends what are you willing to give up to pay for that if you justdo it nakedly, that will cost 2. 5 trillion and then we know they want to give mortgages and improve the mortgage deduction is what paul ryan said, which means of course cut it i believe. Charitable deductions would stay, 401 k s would stay but maybe not state taxes. I dont think that that would be quite enough. Just the corporate part would be 2 to 2. 5 trillion then you have the socalled pass throughs and series of others of people hold on, diane, let austan finish. Those loopholes dont add up to enough. And the second premise that i think theyll have a hard time with is to rely on dynamic scoring, you can make a dynamic scoring argument when growth is not very fast. But when gdp growth is already 3 and Unemployment Rate is already youre telling me all of the hurdles but what were really going for. If we can go to austan goolsbees nirvana and all were achievable, what do you think that number should be . Well, a, the number would probably be for the big countries around 25 but, remember, the rate that our companies are actually paying i understand the effect i get that. In my nirvana, we would be down 25 or lower and we would have broadened the base so the amount that corporations pay would not be lower but the statutory rate would be lower. Thats what my nirvana would be. Diana, you want to weigh in on yours. 20 to 25 where it would be competitive but again it would have a lot of give ups you talked about this stuff on the personal side but corporations and municipal bonds, how do we restructure all of this and do the deductiblety on research and development. All of the things packed into the tax code have to be unpacked and i dont think thats realistic nor will it happen in my nirvana we get to a more simplicity tax code with broadening the base, revenue neutrality in a true way, not just juicy numbers this is really hard to do and it would create efficiencies that i think would over the long term boost Economic Growth and get incentives in the right place for both individuals and corporations that said, thats not whats being discussed i get it. Both of you say the number does need to be lower. Lets see if we can get there. Thank you so much. Tomorrow do not miss an interview with gary cohn at 9 30 a. M. Eastern time. Harvey could change how and where americans bureild their homes. Well look at the brewing battle between Home Builders and insurers and taxpayers next. Highest in Investor Satisfaction with full Service Brokerage firms. Again. And online equity trades are only 4. 95. I mean you cant have low cost and be full service. Its impossible. Its like having your cake and eating it too. Ask your broker if they offer awardwinning full service and low costs. How am i going to explain this . If you dont like their answer, ask again at schwab. Schwab, a modern approach to wealth management. Welcome back, as water recedes there are more storms behind it but not just the big ones homeowners are facing more homeowners need to worry about water and how to keep it out. Diana olick joins us from washington reporter well, theres no way to keep a home dry when you get almost 5 feet of rain period but storms today are increasingly strong and wet. Just this month in d. C. , we had two weeks of solid heavy rain and basements all over this neighborhood had water, including mine how do you protect your house even if you dont think you have a problem . We try to tell homeowners its the water you cant see that causes the most damage. When your basement leaks it doesnt decide to leak one day theres a lot of Early Warning signs such as dampness or musty odor cracks on the walls or floor, again, some kind of discoloration on the walls, white powder on the walls. So heres what you should do. One, make sure youre sump pump is operating and install a battery backup or generator for the sump pumps have wide trenches or french drains that run into the pumps look for Early Warning signs like mr. Bryant talked about and make sure all gutters are clear and running well away from the home if you dont have a basement, make sure the property is graded away from the foundation slab. The general manager says his business jumped 50 in the last five years due to heavier rainfalls and more could nsumer concern about what a damp house does for air quality it could cost 2 to 30,000 depending on what you need and we have lots more of that online real news you can use thank you so much, diana as she mentioned, 5 feet of rain, pretty tough thats what happens in texas where we focus on rebuilding what needs to be done now to make sure future major storms dont cause billions more in damage to homes and business and infrastructure albert betts, Insurance Council of texas and Senior Engineer and professor at the Stevens Institute of technology. Good to have you here, sir. Thank you. Houston had a building boom how many homes have been built in what we know is a flood plain . If you look whats happening in houston or harris county, since 2010 you have more than 9,000 buildings in the 100year flood plain which is massive, massive buildings. And from 1993 2010, you had approximately 30 of your wetlands in houston in that area that have been converted entirely to parking lots and buildings. These wetlands are useful in observing water, not going to mitigate Something Like what happened but at least you would have less flood levels in your areas. Add to that the aging infrastructure, add to that the stressors were facing from Sea Level Rise and drainage system in the area and so on and you would have a i would like to say a a human tragedy of Epic Proportions as we have watched did. For a disaster. Mr. Betts, when it comes to insurance, a lot of these are going to be a lot of these losses are going to be uninsured. Whats going to happen there thats one of the biggest problems and let me first send my condolences and prayers to folks in houston, beaumont, et cetera who suffered losses this is a tragedy, unseen anywhere in the u. S. Lately. And the big concern is those folks probably four out of five who dont have Flood Insurance who thought they werent prone to flooding or werent concerned or thought it was too expensive. Then now faced with a total loss there are programs through fema that may provide Disaster Assistance but in terms of paying for their home, those folks are going to have to look in their own pockets now and thats a tragedy i saw a figure today that actually since the last flood in houston, fewer people buying Flood Insurance. He highlights or implies dont want to put words in his mouth, raises a question with me, why were so many homes built in a flood plain in the first place . What codes are there that would have prevented this . Are there any . Well, in each in texas, 254 counties, theres no statewide Building Code. Each individual county or city may have its own Building Code requirements, keep in mind for a flood, theres no Building Code that can stop a flood from washing away a home. The question becomes economic development, texas is a booming economy. Thousands are moving to texas each day and so its a balance between the need to accommodate the growth, the Economic Energy thats here in texas and also accommodate the safety. Albert, i mean, this is at the risk of sounding callous this focuses the question on whether or not we should permit homes to be build period in these areas. To your point about no statewide building requirements, there are building requirements in texas which allow this to happen and Corpus Christi for instance, the codes reflect the