tv The Kudlow Report CNBC December 2, 2013 7:00pm-8:01pm EST
getting a much needed cool-off. let's hope it drifts. if you're bull, you want it to drift. if you're a bear, obviously you want it to plummet. i don't think you're going to get your way if you're a better. but i think drift down certainly would make this thing less parabolic. and i like that. i always like to team obama proclaims mission accomplished insisting the obama care website is working much better. but, is it really? only 100,000 people supposedly signed up successfully last month. we have breaking news on the continued breakdown of back-end payment-related communications with the insurance companies. in other words, all those folks who enrolled may not be enrolled. and the white house won't fess up. and none of this can hide the cold, hard fact, obama care is a bad product. its health plans cost more, provide less service and choice and it's a budget-buster for washington. you can bet this will be the
number one issue of the 2014 elections and beyond. as we begin the holiday season, we pay extra attention to pope francis' criticism of capitalism. his apparent view that the state will solve the problems of poverty, not the market. i must say, with the greatest of humility as a devout catholic, i completely disagree with his holiness. all those stories and much more coming up on "the kudlow report" beginning right now. good evening, everyone. i'm larry kudlow. this is "the kudlow report." we're here live, 7:00 p.m. eastern, 4:00 p.m. pacific. new obama care enrollment numbers out. there are still glitches everywhere apparently. steve handelsman joins us with the details.
>> reporter: the website's better but it doesn't mean it's good. the nbc news estimate is that 100,000 americans in november signed up for coverage using healthcare.gov. that's a much better number than in october. but it's way worse than what a dozen or so state exchanges have signed up. today administration sources said by 5:30 p.m. eastern time, the site had 750,000 visits. it slowed down at times. some people got "please wait" messages, so-called queuing going on but no crashes or freezes. but there's the back-end problem. like amazon.com. to work, it has to kick out a command for a lightbulb to be sent to you. that's the back end. healthcare.gov has a back end that sends an 834 file to insurance companies. no one will reveal how many or what percentage. but too many of those 834 files are bad. hard to decipher? impossible to use, some of them.
so people who think they have coverage on january 1st in fact might not. >> if health plans don't receive complete and accurate enrollment files, then consumers may not be enrolled and therefore their coverage wouldn't begin on january 1st. >> reporter: sources say a big problem has been found, a bug related to social security numbers and that it's being fixed. the white house warns people who think they've got coverage ought to make sure that they get insurance cards mailed to them and to make sure they've paid the premium. >> if consumers are not sure if they are enrolled, they should call our customer call center or the insurer of their choice so they can be sure they're covered by january 1st. this is a high priority, making sure those who are enrolled are aware of the steps that they need to take, including that they need to pay their premiums on time for coverage. >> reporter: meanwhile, a few more things are out of balance,
out of whack. the deadline moved to march means many of the young people whose premiums are desperately needed to fund the system won't be in the system and won't, in fact, be paying by january. a lot of hospitals separately worry about what they call a nightmare scenario that lower income americans who unfortunately have come to rely on hospital emergency rooms for doctor care will keep doing that because they won't be signed up, even though the hospitals will have their federal subsidies cut by about 5% in january. back to you. >> steve, just a question, march 31st is the drop deadline as i understand it for full payment -- you get your card, you put your money in and that's that. >> reporter: and you get your coverage, right. >> you get your coverage, most importantly. if you don't make the -- there's a december 23rd deadline, there's a january 1st deadline. if you don't make that deadline, do you get a grace period for march 31st? >> reporter: the grace period is defined in the law in the
beginning as you've pointed out, that the fine is so small for basically defying the obama care law, at least in year number one for most of these lower income mostly young people, that that's their disincentive. the argument is not, you better sign up because you have to pay this big fine. it's, you better sign up because now you can get coverage because you run your motorcycle off the road because you don't think you're going to get sick. but young people are looking at this -- insurance companies will tell you that you can't be the brunt of late-night talk show humor, meaning obama care, and also have the people who watch those shows say, boy, i better hurry and sign up. we have no idea now. and the trends aren't good. >> thanks very much, steve. we appreciate it. the question is, will the back-end insurance errors derail the small amount of enrollments
that have been completed? paul, front end, are you satisfied with what happened in the front end? before i get to the back end, front end, november, where are you on this? >> they are way behind etch their own estimates. only 100,000 people signed up to this point. they estimated 800,000 people by the end of the month. their success rate, 80% of people can logon. that's a terrible rate. any online merchanter will tell you that 20% is a terrible failure rate. the administration is setting up its own deadlines and saying, we passed them. but a very poor situation -- >> did they get a grace period on this -- in other words, did they win something back -- i don't want to be so totally 100% critical even though i think it's ludicrous. but do they get a grace period on this? >> at the end of the day, it's what happens when you logon. if significant numbers of people
are having problems, they've bought the media a grace period. >> this whole business about the 834 connection in the exchange, tell us about that. this is the back end. you can enroll on the front end. if there's no payment, there's no record, what's this going to mean? >> there's a lot of confusion. what you have is all this information is coming in incomplete, incorrect. and so they're not able to make an economic statement by saying, how much should someone pay? we're not getting the subsidies from the government. this is -- you thought the front end was chaos. now you're getting to the back end. soon we will get to the back back end. >> just to qualify that -- the physician has to know that the insurance is there. >> that's right. >> and if the insurance is not clear through this so-called 834, we'll just call it the back end, then it's no go. go to your doctor's office and
say i've got insurance to pay for it and they'll see that nothing will be there. >> that's right. and we don't know whether we should sign up for these accounts because we have a suspicion that many plans offer very little reimbursement or offer only a loss to the physicians who are going to see these patients and no physician wants to take money out of his pocket and put it in the government's. >> bad story over the weekend, "new york times," doctors walking away from this whole business. and in particular, i want to ask you, medicaid-related doctors. the one part of this aspect that is exploding is sign up for medicaid. people have become aware of it who might have been eligible but they didn't do anything. whether they're calling it the woodworking effect, people coming out of the woodwork. doctors leaving, what does that do to the whole system? >> the problem is who's going to care for you when you get medicaid. i get $6.50 for an hour -- >> for an appointment? >> for an appointment with me
for an initial concentration. review the x-rays, review the pathology, $6.50. what kind of physician will you get -- especially what kind of specialist will you get -- >> that's an incredible number. what does this mean? >> 30% of physicians across the country don't accept any new medicaid patients and medicaid patients are the ones flooding the emergency room. it's not the uninsured. >> this is one of the things that nobody talked about and it's unleashing. the employer-related, individual-related, medicaid is the biggest winner here. first question, is that going to bankrupt the system? that's a lot of money. does that bankrupt the system? >> it's already bankrupting the states. it's the largest or second largest budget items on every state's budgets. >> the big blue states. >> new york, california, absolutely. it's crushing those states. and there's a little wrinkle in obama care.
there's 100% match for three years, then it goes down. but everybody eligible under the ole rules, there's the old match that applies. that's billions of dollars in added budget damage that's going to be done from this medicaid expansi expansion. people are saying, i'm eligible and since there are all these advertisements, i'm going to sign up. >> i'm going to be a cynical guy. in the end, doesn't obama care get you in effect to gigantic medicaid? isn't that what's going to happen here? this is the bridge. medicaid is the bridge to single payer, government-run system. >> doctors are just not going to accept it. they're not going to live with those rates. a lot of the obama care plans have rates that are a little bit more than medicaid but less than medicare even. so that's another bomb waiting to go off. doctors, hospitals are saying, these rates are just so low, we're not accepting those patients. >> they are also, bill, ripping up medicare. >> right.
>> medicare cuts in theory, $750 billion, whatever, finances by their numbers half of obama care. it's actually not going to -- they're cutting right into medicare. they're also cutting right into medicare advantage. isn't that going to lower the reimbursement rates for medicare and push doctors out of the medicare system? >> yeah, they're already leaving in droves from accepting medicare. and they're going to concierge practices, limiting their number of medicare patients they take. they are taking only commercial insurance plans. and many people are taking -- the premier physicians aren't taking any insurance. you just have to send the bill to your insurance company and hope that they pay for that. >> this is a dumb question, what would you have them do? obama dials you up, sees you on "the kudlow report," wants to know what you would do. what would you tell him. >> give everybody at birth a health savings account and that's what i would do -- >> just give it to them. >> it makes everybody a
capitalist. and capitalism has been the winning formula -- >> tax free, save it up all those years, the inside build-up. this is what harold ford wanted when he was running for the senate and he was a democrat in the house. he was a smart moderate democrat. that's exactly what he wanted. >> because what you have is basically these terrible conflicts that you get when people basically make poor health care choices and want somebody else to bail them out. and when they own the plan, they begin to make healthy health care choices. you have to get rid of the moral hazards that we have all over the government, both in the way insurance is written today and the way it should be written. so that people have individual skin in the game and they can take these accounts and go anywhere with them. >> anywhere they want. >> isn't that more moral? half the people who are going to qualify are going into mistake. a terrible system. fairer system, everyone getting an h.s.a.
better access than medicaid -- >> the mandate is you have to have an hsa. i'm okay with that. but nop mandates for the plan. in other words, have 100 plans. just have 100 plans. the consumer decides the mandates for the plan. >> you choose. >> not the federal government. you choose based on how much you can pay, what kind of deductibility. this is where we could have health care freedom. why? why can't we do this? >> for the last 50 years, we've been running it through employers. >> give them a tax break. that tax break could go into the hsa. >> absolutely. >> that's right. >> i have to get harold ford back on the show. when he was a congressman, he said this. when he was running for the senate from the tennessee, he said that. i don't know whether he's still talking about it but it makes a lot of sense. thank you. bill grace, paul howard, thank you, gentlemen. i believe obama care is at best, at its absolute best, a
terrible product. it's going to be rejected by the country. the question is, do the republicans have a simple and clear response to it? we have a left/right debate on that subject just ahead. later in the show, his holiness pope francis blasted capitalism and somehow believes that big government statism will solve poverty and inequality. your holiness, what about pope john paul ii's successful campaign to end godless soviet communism? that was the ultimate statism that never worked? don't forget, free market capitalism, the best path to prosperity even for the poor. look how strong the people of the ukraine want free market capitalism. i'm kudlow. we'll be right back. every day we're working to be an even better company -
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so here's the bottom line. the product, the health insurance is good. the prices are good. it is a good deal. that's what the affordable care act is all about. that's its promise. i intend to deliver on that promise. >> repetition doesn't always make it so. that's president obama trying to convince us that obama care is actually a good product. maybe he doesn't believe it either. today, the white house declined to answer whether he has lived up to his 2010 promise to sign up. perhaps he, like millions of americans, have discovered it's a bad product. and then there's the other side. republicans need to hammer that home, it's a bad product, period. the house gop has four hearings scheduled this week. but the gop must also offer, i think, a compassionate, transparent and affordable alternative. so the stakes are very high on both sides.
let's talk to our friend, former special counsel to president clinton, lanny davis. we've got to get him onto the republican side. maybe the obama team should read it. also with us, hadley heath. lanny, i don't think it's a good product. and i'll say it's going to cost a whole lot more and the product line is going to be less and the networks are going to shrink and i think people in the country are generally pissed off and he lied and that hurt him, too. >> if you're right, i'll agree with you. i'm just not sure you're right. i certainly applaud you for saying the republicans need an alternate because we are the only western democracy in the world that has no national health insurance guaranteed access to health care. why is it that it's good enough for the canadians, for the
swedes, for the swiss, for the french and for the english but not the americans -- >> the canadians come over the border to detroit. i love the canadians. they've got a good monetary policy, lower corporate tax rates than we have. their economy is growing better. but when it comes to health care, they come across the border. >> well, the wealthy and those that can afford to come across the border do. but those that can't get access to health care in america are stuck in emergency rooms with high temperatures waiting to get their children taken care of. i concede this is a mess. we may have tried too much too fast and on a partisan basis. i've said we should hit the reset button and open ourselves up to new ideas. and larry kudlow always has new ideas, even if they're conservative. >> i appreciate that and appreciate your honesty. republicans are licking their chops about the elections coming up in 2014, roughly a year from now. we're going to talk more about that later in the show.
what i want to ask you is, what can you do for a simple, transparent, compassionate response to the breakdown of obama care? i have an answer. but i want you to go first. >> well, with any health reform proposal, we have to look first at the root cause of the problems in our health care system. conservatives and liberals agree that the health care system before obama care was a mess. but democrats wrongly associated those failures with a market failure. it wasn't a failure of markets. we hardly had a market at all. we didn't have a lot of competitive pressures to hold down prices or give consumers options. pointing out the price source of the problem is the first step towards the right solution. so it doesn't make sense the way we pay for health care. i believe we have some of the highest quality health care in the world. but our payment system is what needs addressing. the third-party payment system, the fact that i use a health insurance company to pay for my well checks, things i get on a regular basis makes no sense. pointing to those problems and coming up with solutions for
those problems instead of rearranging everything -- >> i agree with the market approach. but i want to come back to lanny davis because you are one clever, wise chap. >> thank you. >> lanny, if i were running for office and i am not, but if i were running in 2014 as a republican, you know what i would want to emphasize? that the gop will help those who are sick with pre-existing conditions and they will do so in a transparent way, even if it means having the government just forking over $15 billion or $20 billion to help them out with risk pools and maybe state cooperations -- in other words, i felt that president obama's best selling card -- yeah, universal access was one. but i thought his best selling card and i think it's been the democratic selling card from day one is they will help the sick and the republicans won't and i think the gop's got to turn that around. >> well, you are absolutely right. and i really do agree with your
guest regarding market conditions. i've always felt that going to a physician and taking tests that somebody else is paying for and you don't really care what's on the bill because it's a third-party payer rather than requiring people to have deductibles where they at least have to know what they're getting and decide whether they want to pay, that's the market operating, is a fundamental flaw with or without obama care. but i do want to point out for you conservatives who are watching that president obama rejected a public option on these marketplace exchanges. they're all private insurance companies competing for customers among the uninsured. that was a market-based approach. >> it was but it's not. yes and no. the four plans really are almost one size fits all. the financing may be a little different. but it's not real choice because we see now the networks are shrinking. you're not going to get your insurance. you're not going to get your doctor. you're going to have to pay
higher premiums. this is what president obama got in trouble with because those promises didn't pan out. but back to the other point. in sheer, raw political terms, doesn't the republican party have to convince the country, particularly independents and let's say moderate democrats, the day the gop do worry about sick people and will help those with pre-existing conditions, i think that's been a flaw in republican policy and rhetoric for a long time. >> messaging. >> yes, thank you, message. >> exactly. when you boil down to any of these safety net programs, they have support from americans across all political aisles. >> right. it's a safety net. >> that's why so many people supported obama care because they believed it was a safety net program when it was a redistribution program. if we focus on the safety net, do it at the state level. we've already got some high risk pools at the state level. if they need more funding, more support or restructuring reform
at the state level, conservatives have talked about that for a while and don't get enough credit for. >> lanny davis, i worked for a guy, ronald reagan, he was willing to cut spending but he believed in the safety net. and my mentor, the late jack kemp, always believed in the safety net and helping those who truly couldn't help themselves. i think the republican party have to take that democratic message out because this thing is going to wind up bankrupt -- their plan is going to bankrupt the system and nobody's going to win. gop has to say, here's how we're going to do it, even if it means, heaven forbid, i'm going to say this on the air, even if it means more spending to help the sick. i would do it. as long as it's transparent and we let the taxpayers see what they're getting for their money or to help the risk pool formation that hadley is talking about. last word, lanny. >> i hope you don't run for president because that's a tough message for democrats to beat. and the reason bill clinton was so successful, he believed the
free market and business could be helpful to those progressive goals. you have it slightly the other way around. but there is a lot of commonality. i hope you don't run for president, larry. >> it's one of my pet peeves. universal access, i don't believe that's ever going to happen nor do i believe it should happen. but we could make progress on that. on the other hand, the sick people, the elderly and the sick, the young are not going to finance them. we are learning that now. that's the structural flaw in this whole bloody system. but we must be compassionate. we must be compassionate about this. insurance companies notwithstanding. i'm a compassionate conservative. >> exactly. >> i am. i'm a lanny davis follower. new book "crisis tales" now available. also, hadley heath who's got the market story completely right and understands this whole business about pre-existing conditions. now, was the story about
amazon's supposed plans to use drones to make deliveries the real deal or just an exercise in media gullibility? later on, pope francis appears to bash capitalism, calls for governments to control the economy. why, your holiness? reagan, thatcher, pope john paul ii launched economic prosperity to end godless communism which was the ultimate state power. we're going to take a much closer look at the key economics and ethics of what the pope said. i'm larry kudlow. we'll be right back. [ male announcer ] this store knows how to handle a saturday crowd.
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welcome back to "the kudlow report." welcome back to "the kudlow report." i'm dominic chu with this news alert. looks like the kudlow credo is spreading to the ukraine. look at these protests. as many as 350,000 people joining in, blocking the main government building there today. they want to join the eu, really bring in a little free market capitalism. but the president there is abandoning the eu, instead looking to at least for closer ties with vladimir putin and the russian state. also, the metro north train that crashed in the bronx over the weekend was going 82 miles an hour when it derailed going around a sharp curve. the speed limit is 30 miles an hour. that's the word today from the ntsb. the investigators did not find any problems with the train's brakes. the engineer and conductor will be questioned about the accident. four people were killed and 60 more injured.
now, before we move on to this next story, we want to point out that we know amazon.com pulled off a huge publicity stunt. and we're giving them more air time, yes, on cyber monday. huge day for online retailers but it's cool stuff. jeff bezos said last night that amazon is experimenting with package delivery by drone. yes, that's right, a drone could fly a small package to your house, drop it off like you see there. if it ever happens, still a long way away, but as we said, the video is pretty cool, larry, so we wanted to show it to you to just show you what's happening on this cyber monday. >> i think it's a great story. >> i think it's a fantastic story. can you imagine -- think about how many hundreds, maybe thousands will be flying through the air. >> and we could use those drones overseas and have packages with real things in them -- >> you're going to have to have serious air traffic control
towers -- >> look at that thing. >> fantastic story. >> dominic chu, hang around, great stuff. we're going to look closer at the markets that closed down today with a late selloff. later in the show, the pope slammed capitalism and called on the state to run the economy. this breaks my heart. his holiness has a great evangelical message. we'll take a much closer look at all that in the second half of the hour of our show. please stay with us.
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welcome back to "the kudlow report." welcome back to "the kudlow report." i'm dominic chu here with a market flash. the day started off with a little promise. but that slowly started to fade into the afternoon session. then the selling accelerated into the closing bell for stocks. after all was said and down, the dow industrials last about .5%. the s&p lost five points and the nasdaq, 15 points. among the biggest losers were the retail stocks. it was among the worst performers of the day led lower by retailers like urban outfitters, coach and ross stores, after some sales data showed a record number of shoppers turned out for thanksgiving weekend but that
they spentless money than they did last year. on the commodities front, gold prices dropped. gold futures finished the trading session lower by over 2% to around $1,222 an ounce. it's on pace for its first yearly drop in prices since the year 2000. >> dom, thanks very much. stick around. come back to me and talk. straight to our investors. we have jack bouroudjian and steve cortes. steve, there's two things going on. as dom reported, the retail story, thanksgiving, black friday, pretty mixed back and maybe more negative than positive. on the other hand, we had a very strong ism manufacturing, with an orders component that was very strong and an employment component that is very strong. is the economy going up or down? i think it's going to be more of the same which is a mixed bag.
does the economy grow? yes. but grow gangbusters? no. gold has been dropping like a stone lately. gold is getting so cheap that i don't think that baby jesus would accept gold as one of the gifts from the magi because it's not worth anything. retailers don't have pricing power. i think we saw that over the thanksgiving weekend. was there a lot of traffic out there? absolutely. but santa demands a bargain this year. the stores don't have pricing power. and because of that -- that's a part of why i think gold and most commodities are trading so poorly lately. because i think retailers are in for a tough christmas. >> it's a mixed bag. but i'm enjoying the drop in gold. that shows me the dollar is stronger and shows me there ain't no inflation. all the inflationists are absolutely wrong. money supply hasn't been used. but, but, but, dropping oil is a
very important commodity. dropping oil is a tax cut for the economy and the consumer and motorists and business, jack bouroudjian. what's wrong with that? >> nothing wrong with that. one of the problems that i'm having is the fact that we're seeing this disinflationary pressure drive prices down but we're not seeing any growth. talking about zero interest rate environment but we have a bifurcation of what is happening on main street as opposed to what's happening on wall street. something has to give. it's one of the reasons why after we got through 1,715 in the s&p, i started to get concerned about this market. what we haven't seen is the growth. it's one of those things that is really starting to concern not only me but a lot of other investors. going into the end of the year, we're seeing that battle -- you're seeing the tax selling. gold will probably get hit. gold is down almost precisely what the s&p 500 is up. you could see tax selling take place there.
but going into next year, i have to tell you, it's starting to feel as if maybe just maybe we might have hit that trough when it comes to disinflationary pressure, especially with that new janet yellen fed coming on board. >> i don't believe it, steve. i think forces in motion -- disinflation, so what. we have a low inflation rate, i think that's good. inflation is a tax. you lower the inflation rate, that's a cut. oil is a tax. i know the retail stuff is disappointing and dominic's reporting is accurate. on the other hand, the economy is growing at 2%, 2.5%. profits are rising, interest rates are low. you're not going to have the fed slow down in bond buying until march. that's my message from today's retail sales. >> i agree with you. the last part you mentioned is the most important of all. what's really spurred the stock market has been janet yellen. we're going to get a continuation of bernanke's policies and at least for the near term possibly even an
acceleration -- at least versus expectations. people who thought taper was going to be in september, that obviously didn't happen. i don't think taper is happening imminently. spring at the earliest. that's enough probably to keep assets going. having said that, you want to be in careful places. go-go momentum stocks have seen drops -- >> we should be going through and parsing this out. but i'm an index guy. i know i'm not smart enough -- dom dominic, the correction that everyone's been waiting for and have been wrong will come when the fed truly slows down the bond buying. i don't know when that's going to be. that's your correction. >> let's go with this. there are a number of data points that have to -- that need to come to fruition before the fed even hints or thinks about the idea of pulling back on stimulus. the number one concern for them
is and should be the fact that our employment market is not going gangbusters right now. we're going to get a huge read on that. why? you and i are all going to watch the friday jobs report, huge -- a huge implication for the markets overall. yes, ism, manufacturing and services are important. but this jobs number is the reason why some traders may be saying, hey, 26% gains for the s&p 500, it might be okay just to have a little bit of profit taking as we try to hedge some of our bets. >> you're right. but, very important question, really serious question, will the market believe the jobs number? you know the census bureau controversy. maybe it's gone back three years, maybe it's gotten work. they ain't talking. the inspector general is looking at it. i could think of a lot of people who going to say, no matter what that number is on friday, i don't believe it. >> even if you don't believe it, you're talking about a catalyst that some traders will use as a reason or excuse, whether
credible or not, i'm not making a comment on whether or not the jobs report is a good number or bad number. but it's a data point. in the absence of any other data points, it's what you have to hang your hat on. traders will say, this is one thing we have to consider as we head towards year end. and let's not forget, this could be the best gain for stocks in almost two decades. >> i love this drop in energy prices, i really do. dominic chu, jack bouroudjian, steve cortes, as always, not enough time. but thank you, gentlemen. let's talk about the politics of obama care. the republicans already gearing up for the 2014 elections and they're using the obama care failure to target all democrats, even democrats in the blue states. ace political reporter robert costa has the latest on that and much more next up on "kudlow." [ paper rustles, outdoor sounds ]
president obama's job approval now 16 points under water. the latest polling average showed just 40% approval, 56% disapproval. that and the unpopularity of obama care has given republicans the edge in a generic congressional ballot. the gop is holding a three-point lead. so republicans had trailed by nearly seven points this time last month. now it's all turned around. what's their strategy going to
be to maintain momentum into next year's mid-term elections and can they reach out to the blue states? i think that's the key. here now is ace political reporter and cnbc contributor robert costa. can they reach out to the blue states, bob costa? >> reporter: it's going to be difficult, larry. republicans right now are trying to to have a narrow focus on obama care, to put pressure on blue state senate democrats like mark pryor and mary landrieu. there's new sites they're coming out trying to hammer that message to independent voters in blue states. >> if they do that -- let's go into the heart of it. michigan and california and new york -- stranger things have happened in new jersey. doesn't the gop -- i'm not asking for an opinion, more for political take. does the gop understand that one of the key questions for obama care is that it's helping sick people? the so-called pre-existing
conditions people? that that was one of obama's big starting points. his plan is flopping. the republicans can help the needy, help the safety net, can help the sick. wouldn't that be a reach-out right there? >> reporter: that's exactly right. you're trying to see republicans trying to reach out to voters who understand that obama care has problems but they're still skeptical of the gop. so the gop has to come up with a message that's broad on obama care. and they're doing it right now. it's not just about raising heck about the problems but trying to come up with a message about competence, about fiscal responsibility and about affordable health care. >> eric cantor made an op-ed piece in the richmond newspap newspaper -- maybe it was an interview. he wants to reach out and have a pro-clothe plan. it's clear he's been watching chris christie's success in new jersey. but do you think the republican caucus in the house will go that direction? >> reporter: that's the question right now because right now, we're looking at two key deadlines. there's potentially another government shutdown in january with the new c.r., january 14th.
and february 7th, there's another debt ceiling deadline. republicans have a choice to make. are they going to focus narrowly on obama care and hit that message throughout 2014 or are they going to have another standoff on fiscal issues earlier next year? if they do, they could lose obama care momentum. >> if they stand off again -- it ain't worth it. let them pass the spending sequester cuts and be done with it and start telling people that the gop can do health care better than the democrats. and like i say -- i don't mean to preach but show people they can take care of the sick. that's not the only issue but it's one of the issues. it's not been a republican strong point in recent years. >> reporter: i think you're right. so often the gop gets slammed for going back to reagan. but you see people in the senate going back to jack kemp, one of your old mentors and friends. >> that's right. reagan himself believed in the safety net. he absolutely did. robert, thank you so much.
now, is pope francis anti-capitalism? his first apostolic exhortations suggests he is. but does he really believe that the state produces more prosperity than capitalist markets? we're going to look very closely at these burning issues just ahead on "the kudlow report." ♪ [ male announcer ] how could switchgrass in argentina, change engineering in dubai, aluminum production in south africa, and the aerospace industry in the u.s.? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 70% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing.
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particular, he argued that what he calls trickle-down economics -- he didn't define it -- but that doesn't create growth or social justice. and he asserts that the right of state, meaning governments, charged with vigilance for the common good should exercise control over the economic status of the people. with all due humility and as a churchgoing catholic convert, a devotional convert, i adore the holy father, i still must completely disagree. i still must disagree. look at godless communism, godless socialism. now, the pope's evangelism has fortunately more than that brief economic session. and that evangelism is for me the great part of this exhortation. but we must look at the whole thing. here now is rusty reno, the editor of "first things" magazine. and michael matheson miller,
research fellow with the acton institute. gentlemen, welcome to the show. rusty, let me -- real quick, i read it over the radio. i talked to the father for over an hour. in the gospel of matthew, we find jesus warning us how our lives will be judged. his words are pointed. we are to feed the hungry, welcome the stranger, clothe the naked, visit the prisoner, for what we do to the poor and the destitute, quote, the least of these, my brethren, says jesus. we do that to the lord himself. rusty, i agree with that. i agree with that heart and soul, the war against poverty. i agree with that. but i cannot agree with reagan and thatcher and pope john paul ii and what they did against godless communism and the evils of the state, that is not going to be the way out. that is what puzzled me about what pope francis said. that is what troubled me about it. what's your take?
>> i think we have to be sure we don't fight the last war. i.t. seems to me that pope francis is responding to the fact that global capitalism is triumphant and we have to deal with its limitations and its accesses and that's going to require something more than just more free market measures. >> doesn't the state have excesses? i just was so surprised because that language -- i understand the pope's job is not to pr proselytize about free market capitalism. but you look at the numbers here, the u.n. study, extreme poverty has fallen 43% in the last 20 years. the world bank, extreme poverty has fallen by about 25% in the last 30 years. 163% increase in world growth among the developing countries. in other words, that part of the
equation is working. what's not working, michael miller, and this is my -- what's not working is the move to secularism. we're moving away from morality and spiritualism and religiousty. that's what pope john paul ii and pope benedict talked about. why is francis not harping on that? >> i think he is. this is a key point. let's not try to spin francis and say he's pro-capitalist because he surely isn't. part of this is he grew up in argentina where his experience of capitalism is crony capitalism, big business, big government, big interest groups all working together. and really excluding the poor. but i think if you look at his document, he's talking about consumerism. he's talking about really the underlying problems that, look, i'm a free marketer like you, larry. but we can agree that a free market perfectly run that's
secular and hedonnist still kills souls. >> i don't believe that. i think other things kill souls. honestly, really. >> but if it's without a moral underpinning -- >> don't forget -- >> everything becomes focused on matter. >> adam smith, the great churchman -- i want to go back to rusty's piece. just think, children born out of wedlock, the rise in the divorce rate, the so-called sexual revolution, the decline in the culture of marriage and a million other things, these are the things -- not prosperity, but these are the things, rusty, that we need to evangelize about and we all must pray and have it in our heads and minds and hearts and souls that we must improve. >> but i think that, larry, what you're saying really reinforces the pope's point because if we think -- if we become too
rah-rah about capitalism, we say that wealth creation is the be-all and end-all of human life. that reinforces the secularist mentality. >> we have to leave it there. gentlemen, please come back. much more to discuss there. >> thank you, larry. >> esht prappreciate it very mu. thanks for watching. it's the moral and religious and spiritual deficit we have to work on. but let's not damage the economy in the process. i'm kudlow. we'll have more on this later. '. that's correct. cause i'm really nervous about getting trapped. why's that? uh, mark? go get help! i have my reasons. look, you don't have to feel trapped with our raise your rate cd. if our rate on this cd goes up, yours can too. oh that sounds nice. don't feel trapped with the ally raise your rate cd. ally bank. your money needs an ally.
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>> narrator: in this episode of "american greed"... samuel israel the third, the big money hedge fund manager... >> carl catauro: most good fraudsters, and ponzi schemers in particular are people who strike all the right chords. >> desperate to succeed... >> guy lawson: he lived through the most decadent era in human history, and was a creation of it and was destroyed by it. >> and the scam that bilked investors out of 300 million dollars. >> john siegesmund: literally, within the space of minutes, i had lost $336,000 dollars. >> it all leads to this bridge and a suicide note... leaving investigators with two key questions...