Good wednesday morning. Welcome to squawk alley. Carl quintanilla nia with jon fortt and Kayla Tausche at post 9. Joining us from Henry Blodgett and jason calacanis. Good morning, guys. Weve got breaking news this morning. Weve got top executives from at t and time warner testifying on capitol hill today before the Senate Judiciary antitrust committee. Were going to monitor that and definitely keep you up to speed. In the meantime, Time Magazine naming donald trump the 2016 person of the year. The president elect appeared on the today show this morning, talked about everything from his upcoming cabinet picks to his relationship with business in the u. S. My trade policies are going to be terrific. And by the way, were lowering taxes in this country. Were getting rid of 90 , maybe 85 of the regulations which are stifling business. Boeing is going to be a tremendous beneficiary of that and maybe even mostly regulations. I mean, people are more happy about the regulations, even though were massively cutting taxes for business. All morning long weve been talking to ceos on this show and others, sharing their outlook for business under trump. Earlier this morning we heard from ciscos Chuck Robbins talking with our friends on squawk box. Take a listen. Regardless of your political beliefs through the election cycle, the democratic process is complete and we have a president elect and his names donald trump. And hes pro business. He is everything that hes talking about is about trying to drive the u. S. Economy. I think hes also balanced understating that in order for us to have a strong u. S. Economy, we have to have a strong global economy. Henry, you have your ear to the ground on this, too, after a great admission conference this week. How are executives adapting to what is obviously a much different, new world . Well, ill say. I think that relatively quickly executives are going to adapt by not taking seriously everything they hear all day. And thats fine. Trump has always spoken his mind right at the top, and i think were all quickly getting used to the idea that hes going to continue to do that. Hes going to say a lot of stuff from his view. Hey, hes negotiating, hes just highlighting issues. You kind of have to roll with it. You saw with boeing stock yesterday, after an unprecedented shot at the company has now described as negotiating, it dipped, but it came back. And so, i think the market and executives are going to get used to this over time. And the market would tell you that, if fact, most people believe that what trump is doing is going to end up being good for the economy. And we saw sprint shares go the other way at the same time because it is majority owned by softbank, who, of course, announced 50 billion investment into the United States, 50,000 jobs. But jason, interestingly, Chuck Robbins of cisco also said this morning if they brought their 60 billion back into the u. S. , theyd probably put it towards dividends, buybacks and mergers. How do you get that money to go toward the intended purpose of creating jobs and building out a business . Yeah, i have a very simple idea. You know, trump obviously likes to negotiate, he likes to bully you, then bring you to the lobby, take a selfie, and then have some victory lap with you. Hes going to be able to use the repatriation of this cash overseas as a tool, i believe. So, if he said to apple, which obviously has the most money overseas, hey, if you want this money to come back, well give you tax amnesty, well give you 100 of it back, but youve got to put onethird of it towards factories like elon musk is building with the gigafactory, and maybe even raise wages. So, trump wants to be a hero to the people, and hes got a little bit of negotiating room with that repatriation of taxes. I can see him using it as, you know, a real big carrot and stick to companies, and just on a casebycase basis, because he seems to like to work on a casebycase basis with these companies. I dont know how that scales, but it could be a potential tool for him. Yeah, that is a question, henry, how it scales over time. I wonder how much of this is optics coming in, that the president elect is taking this issue seriously and getting going right off the bat. But how much of this do you think he can continue maybe with the repatriation issues . How far can he push it before you start messing with the whole idea of free markets, if you start dictating too much exactly what Companies End up doing with repatriated cash, youre starting to dictate how business was run based on something other than what customers want and what investors believe and want to see grow the company. No, thats exactly right. I would say that donald trump is very good at optics, and the optics so far, with the carrier deal, for example, seemed to be very good for him. People seemed to cheer that. Hes paying attention. One thing that Chuck Robbins said yesterday that was very interesting at our conference is, you know, people are aghast that these ceos are meeting with trump and hes having meetings with folks from japan and everything else. He said, this is the only country in the world, the United States, where im not meeting with the heads of state continuously as a huge Global Business leader. And so, it was certainly interesting perspective to hear that. Jon, i think to your point, the key for all of us who are trying to do business is trying to figure out what is going to be consistent about this. And ultimately, you want to have very consistent policies that everybody can work with so you dont have to spend too much time worrying that the fist from the sky is going to suddenly hit you next. That will keep people very cautious and worried. So, once we get past the rhetoric here and the opening salbos, everyone will be looking to see what is actually the policy moving forward. Good point. I noticed meg whitman is not going to this meeting of tech leaders, so well see if there are other ceos who end up truly getting iced out. But thats maybe a discussion for another day. Also getting word that foxconn, the manufacturer of apples iphones, ipads and other products, is in talks to expand into the u. S. No word on the size and scope of the investment or if it has anything to do with president elect trumps push to bring manufacturing back to the states. In his interview with time, though, he said i said to tim cook its my ambition to get apple to build a great plant, your biggest and your best, even if its only a foot by a foot bigger than someplace in china. We should note, apple is just one of foxconns many customers. Jason, what do you make of that . Does that lend even more credence to his apparent commitment to bring manufacturing home . Yeah. I mean, listen, manufacturing jobs are going to go to robots is the sort of belief that most smart people have. That being said, the most advanced factory in the world is the gigafactory right now, and tesla i actually visited it, and its just extraordinary. Theres a lot of jobs being created by tesla and solar city. So, i think trump should be focusing on that company of, hey, heres the model for manufacturing locally. Apples going to be the big test case, because apple under steve jobs said listen, these jobs are never coming back. Can these jobs come back . Its a big question. And you know right. Im not sure tim cook is going to make the pilgrimage to trump tower and, you know, beg trump for validation. If he doesnt, you know, im not sure what that means for shareholders of apple, which feels like a little bit of a troubled company right now. So, thats probably the most atrisk company i can think of in technology right now. Yeah, henry, there is a question of whether Skilled Labor existed to staff a factory like that that apple would potentially build here, but im just thinking back to a couple years ago. This highprofile fight between the states, all of these rival states trying to outbid each other for that gigafactory that ended up landing in nevada. If you liked that fight, youre probably going to love whatever happens between the states to get an even bigger factory. What sort of incentives would a state have to think about putting forward for Something Like that to land there . Well, there are a lot of incentives. And focusing on incentives is good. Lots of things you can do with taxes and the money that flows in with the jobs is obviously great for the states. And i think having the administration focus on that, on creating the incentive to actually build factories here or create other jobs, because ultimately, theres nothing special about manufacturing, other than historically it has paid better than some of our service jobs. But another option is making our service jobs pay better, rather than focusing just on manufacturing. But, so, creating incentives is one thing. The other thing that president elect trump is doing now, though, is threatening tariffs for any companies that want to manufacture globally. And i think what has to happen behind the scenes here is that the president elect has to realize, apple is a Global Company competing on a global stage. If the company is suddenly forced to move all of its production back to the United States, youre going to cripple one of the United States best Global Companies on a global stage because samsung, for example, wont be required to do that. Wait a second. And before we get too deep into that, facts are so important here. There are more than 50,000 people at a plant the size of a city that assemble iphones. You cant move that to the u. S. Its lowcost labor. Its not the kind of work that workers in the u. S. Do or can do. The economics just dont work. And even if they somehow did, if you get tons of robots involved, the Skilled Labor thats needed to run a plant like that does not exist on u. S. Soil. So, for the president elect to say that is one thing, but it doesnt make any sense whatsoever. Its a completely invalid statement, and i think its important to look into that fact before i dont know if thats true, john. It is. Ive talked to tim cook about this at length. Have you been to the gigafactory . I think thats apples position, is that you cant move to here, and yes, it would be hard to move here, but if they put a 50 tariff on every iphone coming from china and you essentially gave a 50 discount to every one made here, im interested to see what would happen. It could be a disaster. And thats i think the danger of trump. Its all fun right now to have everybody going to trump tower. Its great theater. Its amazing television to watch him have massa come to the lobby and say theyre going to create 50,000 jobs. What if trump, who is answerable to no one, puts a 50 tariff on iphones coming from china . What happens when you try to create manufacturing scenarios that make no sense is what we saw with flextronics trying to build motorolas phones just back in 2014. The thing shut down in ft. Worth very quickly. Hopes were dashed. American workers who were told they would have these jobs ended up not having these jobs. You cant just sort off a wing and a prayer make up things around hardware manufacturing and expect it to work. You cant. You cant. And i think its important to remember on the point of manufacturing versus servicing jobs, the manufacturing jobs used to pay terrible wages and had terrible conditions. And over time, starting with ford, companies started raising wages. Obviously, the unions came in and that helped a lot, but thats what made manufacturing jobs good. We actually have a low Unemployment Rate in the United States right now. And the problem is that a lot of those jobs are seriously low wage. It doesnt have to be that way. And in fact, were starting to see minimum wages rise. Its too bad it happens through legislation. Itd be great if Companies Just volunteered to pay their folks more. Exactly. But actually, that is working and thats getting the money back into the economy and helping the economy overall. So, thats what we really need to focus on. Its not manufacturing per se. Yeah, and it does sound also, if you listen to the speaker, at least, speaker ryan, i think there is some hope amongst some that theres more carrot than stick, especially when it comes to Corporate Tax rates coming down, and that might solve more ills than a wouldbe tariff. Guys, lets just do one more thing here, keeping our eye on capitol hill. At ts chairman and Ceo Randall Stephenson speaking, along with time warners ceo, billionaire investor mark cuban is there, all testifying in what could be the first major m a deal under a president trump. Our eamon javers caught up with stephenson before he entered the chamber. No, i have not had direct contact with the trump administration. Reporter what do you think this political moment means for your merger . This is a huge deal. Its going to attract lots of attention. Obviously, weve seen donald trump tweeting his criticisms of individual companies. Actually, were looking forward to telling the story about the consumer benefits of this thing, putting these two companies together, the innovation that will come from that. So, we think its a really good story. Actually, were anxious to get in front of the department of justice and begin to talk about the facts of the deal. Henry, of course, that comes after you spoke to stephenson and buickus yesterday and some fascinating comments about the deal, the First Amendment and more. Absolutely. And i have to say, in our interview yesterday, Randall Stephenson was terrific. Thats the first time ive interviewed him one on one. He is very persuasive, has a great vision for the future. And having listened to mark cuban right before we went on air, he has nailed it. This concern about this particular merger, at t and time warner, to me it is, youre going back to the 90s power structure and even the middle 90s before the end. The biggest, most powerful companies right now are google, facebook, apple. We are focused, if we pay too much attention to this on the last war, and this merger should sail through. And in terms of just quietly what folks are saying, ultimately, thats what they think will happen. Jason, do you agree . Is it a done deal in your mind . Yeah. I dont see why anybody would block this deal. And i think, like henry says, the more powerful companies and the more interesting ones are going to be amazon, which could bundle with amazon prime all kinds of television stations and have all kinds of other billingtype antitrust issues, so i dont see it as an issue. Well that was easy the other issue is, when well, the edge is really m a in general. So, is trump going to be pro m a or anti m a . And there are two types of m a. One is, you know, is it efficient and are we going to get rid of jobs and were going to have savings, you know, when Telecom Companies merge . And then there are other ones that are growth m a. When google buys youtube, they add thousands of employees. So im interested in trumps position on the mi a situations where jobs go away versus where they grow. Again, nobody knows what trumps going to do. The guys a complete loose cannon, he answers to nobody, and i think this is what the American People wanted. They wanted to clean house. And you know what, its going to be an interesting experiment. Hes going to be times man of the year for the next four years. Get used to it. I think the National Journal called it a post ideological presidency, henry. Its going to be interesting. On the one hand, you wouldnt be surprised to see, for instance, cipheous restrictions on chinese money, but masasan tells you at trump tower the door is open to some business. To jasons point, it is an experiment. And all i can say is as an executive and a citizen of this country, i hope trump continues to surprise people positively. He certainly has from the beginning. Did a lot better than people expected. Now hes going to be our president , and i hope that he turns out to be a great president. Henry blodget, jason hes going to be an amazing president and he loves business terrific or horrible, one or the other henry blodget, jason calacanis, thank you for joining us. As we go to break, live pictures of capitol hill this morning. You can see the Senate Antitrust committee out of the judiciary talking to executives from at t and time warner, who are making their case for an 85 million merger. Were going to monitor that and bring it to you. Narrowest range for the dow in over two years. Were up only 26 points. Were back in a moment. [engine revving] is it a force of nature . Or a sales event . The season of audi sales event is here. Audi will cover your first months lease payment on select models during the season of audi sales event. Generosity is its oyou can handle being a mom for half an hour. Im in all the way. Is that understood . I dont know what shes up to, but its not good. Cant the world be my noodles and butter . Get your mind out of the gutter. Mornings are for coffee and contemplation. That was a really profound observation. You got a mean case of the detox blues. Dont start a war you know youre going to lose. Finally you can now find all of netflix in the same place as all your other entertainment. On xfinity x1. David faber rejoins us at post 9 this morning. Got some news, i believe its on abbott. Yes, a followup here, m a news. For some time weve anticipated this. This morning in Delaware Court, abbott filing to be able to terminate its deal to acquire alere. Remember that deal done quite some time ago, actually, prior to abbotts deal to acquire st. Jude. And the two parties have been fighting for some time over whether or not things at alere that had not been anticipated were, in fact, going to represent a material adverse effect to the merger agreement. Now its going to be up to a Delaware Court to decide, in fact, whether that is the case. Shares of alere were halted. They may have reopened. Theyre down, but not sharply. Why . Because the stock has been trading far below the original price of the deal, an expectation that either they would get to Delaware Cour