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CNBC Kudlow & Cramer-Transcript

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Location: Washington, DC


CNBC News Transcripts

SHOW: Kudlow & Cramer (5:00 PM ET) - CNBC

July 6, 2004 Tuesday

HEADLINE: Representatives Harold Ford and Paul Ryan discuss the Kerry-Edwards vs. Bush-Cheney presidential tickets

ANCHORS: LARRY KUDLOW; MICHELLE CARUSO-CABRERA

BODY:

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CARUSO-CABRERA: Representative Ryan, is there anything on this ticket that you see that the Republicans should be worried about?

Representative PAUL RYAN (Republican, Wisconsin; Ways & Means/Joint Economic Committees): Well, I don't agree with Harold's assessment, as you would imagine. But I think this pick of Edwards is more about style than substance. I represent Wisconsin, which is one of the top-four targeted states. In the Midwest, I don't think Edwards is going to play particularly very well. I think there have been other picks that would have helped Kerry in the Midwest, especially in Wisconsin, Iowa, Ohio, Missouri, much more than Edwards.

Nevertheless, John Edwards is a-he's got a lot of style. But, you know, Harold Ford has more experience in government than John Edwards does. He has the same amount of experience in government that I do. So I think his lack of experience may play into this. If you look at the National Journal, which is the non-partisan, very well-regarded barometer of how politicians vote, John Kerry was rated the number-one liberal senator in the United States Senate. John Edwards was rated number four on the liberal list, the fourth-most liberal senator and the first most being Kerry. So, ideologically, you don't have a liberal and a moderate Democrat. You have a liberal and a liberal Democrat. And I don't think that's going to really play well in those swing states.

KUDLOW: Harold Ford, let's drill down on some of these issues. Let's try to have content triumph over style.

Rep. FORD: Sure.

KUDLOW: On torts...

Rep. FORD: I disagree with the style comparison.

KUDLOW: I understand, but let's drill down on the issues for our stock market people and so forth.

Rep. FORD: Sure.

KUDLOW: On torts, 2 percent of GDP on the way to 4 percent of GDP is absorbed by settlements that have bankrupted nearly 60 companies on asbestos alone, thrown tens of thousands out of work. Second, if you raise taxes on investment, you won't fund businesses who create jobs. And, third, if you're a protectionist and want to raise tariffs, what about the Wal-Mart, Kmart, Costco, Target, Home Depot and Best Buy shoppers whose living standards are improved by low-cost imports? How are those positions by Mr. Edwards pro-growth?

Rep. FORD: Well, remember, we're electing President Kerry, not President Edwards, at least not yet.

KUDLOW: But there's no disagreement between them on these issues, is there?

Rep. FORD: There is. There is. Well, let me put the facts out for everyone to assess. Number one, John Kerry is a free-trader. He's been pro-trade since his arrival to the Senate. As you know, Boston and Massachusetts represents one of the nation's leading technology corridors, and without John Kerry's leadership in the Senate...

CARUSO-CABRERA: But isn't he the guy who called all the corporate executives 'traitors' for wanting to outsource?

Rep. FORD: No, ma'am. He was the one who called them...

KUDLOW: Benedict Arnolds.

Rep. FORD: He was the one that called some companies Benedict Arnold-like for locating offshore, not wanting to pay US taxes while wanting US troops to protect them and their interests abroad. And I happen to agree with him.

I think the second point you raise, Mr. Kudlow, regarding raising taxes on investments, by no means would John Kerry do that. He's made clear his treatment of capital gains and other key investments that bus-or other tax treatment of investments that businesses depend on to grow he would not touch. He has made clear when it comes to income taxes on some Americans, that he would consider raising them in exchange for more assistance for education and health care. And, again, that will be a set of priorities where these two candidates, John Kerry and George Bush, differ. And America will have an opportunity to choose.

When you talk about experience-and I heard my dear friend Paul Ryan address this issue-the reality is this: George Bush and Dick Cheney came to office promising the most experienced foreign policy team ever. If this is the best this most-experienced team can do, I think me and America is willing to take a chance on John Kerry, who has combat experience, who has 19 years in the Senate, 19 years on the Foreign Relations Committee, as well as a young United States senator who served on the Intelligence Committee, who shortly after 9/11 called for massive reforms in the intelligence community and who also called for a larger investment in homeland security.

KUDLOW: Paul Ryan...

Rep. FORD: He may not have all the years that John Kerry has in the Senate, but John Edwards is as experienced as George Bush was when he was elected...

KUDLOW: All right.

Rep. FORD: ...president in 2000.

KUDLOW: All right. Paul Ryan, Harold Ford, who is my favorite moderate pro-growth Democrat...

Rep. RYAN: Mine, too.

KUDLOW: ...in the entire country...

Rep. RYAN: Mine, too.

KUDLOW: ...is describing a mythical character. Let me get you to comment on this: John Kerry has said several times recently on the stump that if NAFTA free trade were up for a vote again, he would vote against it.

Rep. RYAN: Right.

KUDLOW: And he is against Central America free trade, and he is against African free trade. He wants to raise the tax rate on investment, like cap gains and dividends...

Rep. RYAN: That's right.

KUDLOW: ...which would be devastating. And the tort lawyers, with Edwards' ascendancy, now have moved to their dream of owning the Democratic Party. Isn't that right?

Rep. RYAN: I think that's right. I think what you're seeing with the Kerry campaign is doing one thing in the Senate and saying another while running for president. So we see this flip-flop all over the place. When you take a look at these targeted states, like Wisconsin, they'll vote for Democrats for president. We've gone Democrats since 1984. But the kind of Democrat that wins in these targeted states is one who's consistent with his beliefs. That is not the kind of Kerry that we are seeing in this campaign.

Another thing: To be brutally honest, Larry, I think this election is about electing or defeating George Bush, not John Kerry. And if you take a look at the Bush record, on the economy especially, the Bush tax cuts are producing this economic recovery you have today. And these Bush tax cuts, already this year, are raising more money in revenue to reduce the deficit than the revenue we took in at these higher pre-Bush tax-cut rate levels. So let me just say that again. We've lowered tax rates. We have more economic activity, more jobs and more tax revenue coming into the federal government than we did under those higher tax rates.

The deficit is projected to go down in the neighborhood of $100 billion this summer. So I think when Americans look at the results of this administration, more jobs, getting on the path to reducing the deficit, making sure that we are fighting terrorism with everything we got and not giving the UN a blank check in the decision-making, which is the foreign policy guidelines as been given by the Kerry campaign, I think people are going to really vote to rehire George Bush. That's what it's all about.

CARUSO-CABRERA: Well, let...

Rep. FORD: Let me just respond one second. I think it's unfair to suggest that John Kerry or John Edwards somehow or another, that somehow they will cause this country to move further in the wrong decision.

Rep. RYAN: Well...

Rep. FORD: Here's the reality. We've lost 1.8 million...

Rep. RYAN: John Kerry has been doing that throughout the campaign.

Rep. FORD: But, Paul, you can't deny-know as much as-you're not a mathematician, you can't deny that the country's lost jobs since George Bush has been in office. Tuition...

Rep. RYAN: We've lost jobs and we've...

Rep. FORD: Let me finish.

Rep. RYAN: OK.

Rep. FORD: College tuition is higher, gas prices are higher, we've seen American families face higher taxes at the local and state level as a result of this administration, so again, I'm willing to say that if you believe that George Bush has done a good job, we're willing to put our positive, compelling, forward-looking message before the American people here over the next several months and let them make a determination, and I happen to believe...

CARUSO-CABRERA: Representative Ford...

Rep. RYAN: One...

Rep. FORD: ...that Americans are going to choose...

Rep. RYAN: 1.5 million jobs...

CARUSO-CABRERA: Representative...

Rep. RYAN: ...since January...

Rep. FORD: But you lost...

Rep. RYAN: ...have been created.

Rep. FORD: ...2.8 million since being in office.

Rep. FORD: We've had 1.5 million jobs since January.

CARUSO-CABRERA: Well, Representative Ford, can I ask you about something? You know...

Rep. FORD: Yes, ma'am.

CARUSO-CABRERA: ...we've been talking a lot here about the deficit and how much spending is being done. Representative Ryan is advocating this new congressional system really intended to put a lid on congressional spending. Are you willing to support that measure?

Rep. FORD: Absolutely. Here's the only challenge with it, though. If we eliminated every penny of domestic spending today, we would still run a deficit according to the numbers of the CBO as well as the OMB, meaning the White House...

CARUSO-CABRERA: But for how long?

Rep. FORD: ...Office of Management and Budget. That would mean no money for veterans, no money for agriculture, no money for health and human services, no money for education, zeroing the budget out. The reality is we're going to have to make some tough decisions here at the federal level. The only difference between presidents and governors is one: Governors have to balance the budgets, and presidents can borrow money, and you can't deny it, Mr. Kudlow, Mr. Ryan or anybody. We have borrowed more money under George Bush...

KUDLOW: Paul Ry...

Rep. FORD: ...than we have in the last 50 years in this nation...

KUDLOW: All right. Paul Ryan, first of all...

Rep. FORD: ...period.

KUDLOW: ...Mr. Harold Ford's answer to that was very good, and I-he would look at the kind of spending limits, Paul, that you're proposing.

Rep. RYAN: Yeah. Well, I think Harold would work with us on this.

KUDLOW: But Paul, I'm worried about-I've got to say this, I'm a supply-sider, but I am worried about the Republican Party...

Rep. RYAN: Yeah.

KUDLOW: ...you didn't get the kind of support for your spending limit bill that you should have gotten.

Rep. RYAN: That's right. That's right. And you know what, Harold? I think you and I can and should work on this. And what we're talking about is changing the culture in Congress. We have had these rules in place since 1974 that games the system to have higher taxes and higher spending in Congress and wasteful pork-barrel spending. What we proposed on the floor two weeks ago are a series of reforms aimed at getting control over spending, stop the pork-barrel spending, stop this inflated baseline spending and more importantly, make sure that when Congress passes a budget, we actually enforce our budget. That's the biggest problem we have around here is we'll pass a budget but break it a couple weeks later.

KUDLOW: How about getting rid of useless departments?

Rep. FORD: The Republican-run...

KUDLOW: Get rid of useless departments.

Rep. FORD: The Republican-run...

Rep. RYAN: Absolutely, Harold. Harold, I agree.

KUDLOW: The Agriculture Department has 7,400 offices. The Commerce Department is totally protectionist. The Labor Department, I don't know what they do anymore.

Rep. FORD: Mr. Kudlow...

KUDLOW: Why don't we just get rid of these, Harold?

Rep. RYAN: ...(Unintelligible) have...

Rep. FORD: Republicans control the House, Senate and the White House, and they couldn't get their own guys to support it, so you can't blame...

KUDLOW: Well...

Rep. RYAN: ...(Unintelligible) votes on this? Democrats voted this...

Rep. FORD: You can't blame John Kerry and John Edwards for this.

KUDLOW: You know what, Harold Ford? I got say something, on the point you just made, you are dead-in-the-water right, and I agree with you.

Rep. FORD: Yeah.

KUDLOW: My guys have done nothing on spending restraints.

Rep. RYAN: Well, there are many of us fighting for this stuff.

KUDLOW: Yeah, well, individuals like...

CARUSO-CABRERA: It's because you have...

KUDLOW: ...Paul Ryan, yes.

Rep. RYAN: Let's...

CARUSO-CABRERA: It's because you have all three-you have one party controlling all three ...(unintelligible).

Rep. FORD: We're ready to change that, believe me.

CARUSO-CABRERA: If we had a divided government, things would be much better.

KUDLOW: The Republicans sound...

Rep. FORD: We've got two guys ready to change that.

Rep. RYAN: We don't have a functional majority in the Senate.

KUDLOW: The Republicans sound like Democrats, for heaven's sake.

Rep. RYAN: We don't have a functional majority in the Senate. The Democrats voted against every one of these budget reforms. The majority of Republicans voted for these budget reforms. Democrats are bad on spending.

CARUSO-CABRERA: All right, guys.

Rep. RYAN: Republicans aren't as good as we say we are on that...

Rep. FORD: We'll take a management change any day and get it done, Mr. Kudlow, I promise you.

CARUSO-CABRERA: Gentlemen, it's always fun. Thank you...

KUDLOW: I am for the Ryan-Ford ticket or maybe what's going to be the Ford-Ryan ticket. You guys are too young. You are both terrific thinkers. I mean that.

Rep. FORD: Thanks for having us on.

KUDLOW: I mean that.

Rep. RYAN: Well, thanks a lot.

CARUSO-CABRERA: Representative Harold Ford, Representative Paul Ryan. Thanks, gentlemen.

Rep. RYAN: Appreciate it.

Rep. FORD: Thank you.

CARUSO-CABRERA: Coming up next, we're going to get the market reaction to the Kerry-Edwards ticket. I don't know if tonight, or today, is any reflection of what they thought.

And then later, sabotage disrupted an oil pipeline in Iraq over the weekend, just one of the reasons oil prices are up. So what's the outlook for oil these days? We'll be right back.

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