seconds away on the "kudlow report." ism manufacturing number surprise to the upside. and alan greenspan very bullish. one year to the day bin laden is killed, president obama in afghanistan. we're going to bring you his address to the nation live. and why don't these dopey occupy wall street protesters realize it's under president obama that the middle class has actually gotten poorer? they're chasing after the wrong demon. the "kudlow report" moments away. i like to say there's always a bull market somewhere, and i promise to try to find it for you right here on "mad money." i'm jim cramer. see you tomorrow. huge show tonight. what do you have? >> all right, jimmy, great ism numbers jolt the market and alan greenspan, he's a bull. good evening, everyone, this is the "kudlow report." in 30 minutes, live here on cnbc, president obama will

address the nation from kabul, afghanistan after making a surprise visit to sign an agreement with the afghan government. one year to the day bin laden was killed. after the speech, retired four-star general mccaffrey and a marine veteran michael grim. also this evening, the president's new election slogan. forward, but to what exactly? thousands of the occupy wall street protesters take to the streets. these people don't even realize it's under president obama that the rich have gotten richer and the middle class has gotten poorer. they've gone after the wrong demon. and yes, ism manufacturing numbers surprise on the upside have a positive jolt to the stock market. the dow closes at the highest number in four years. adp numbers, jobless claims and then nonfarm payrolls later in the week. but first up, breaking news in less than 20 minutes, the president addresses the nation from kabul. the surprise visit.

joins us at the white house, good evening, jon. >> larry, the president is going to address the nation in half an hour. he made that secret trip to afghanistan as you mentioned to commemorate the one-year anniversary of killing of osama bin laden to also strike a strategic partnership with afghanistan hamid karzai for what's going to happen. the president said even after those 90,000 american troops are gone in 2014, the united states is not going to leave afghanistan on its own. here's the president. >> with this agreement, afghanistan has a friend and a partner in the united states. mr. president, there will be difficult days ahead. but as we move forward with our transiti transition, i'm confident that afghan forces will grow stronger. the afghan people will take control of their future. >> reporter: now, in the

excerpts we've gotten of the president's speech he says we retain a clear path of success in afghanistan while delivering justice to al qaeda. that is the reference to the takedown of osama bin laden a year ago. now, he sparked some political controversy by including mention of that accomplishment and drawing the distinction with mitt romney in a campaign video. mitt romney commemorated the anniversary today by campaigning with new york city -- former new york city mayor rudy giuliani. he hit back at the president for too much politicizing. >> i think it's totally appropriate for the president to express to the american people the view that he has that he had an important role in taking out osama bin laden. i think politicizing it was -- and trying to draw a distinction between himself and myself was an inappropriate use of the very important event that brought america together. >> reporter: now, you can expect more criticism of the president after that speech tonight. we will hear from him just after 7:30, larry to mark this very

important occasion. both to the united states and the american people, but also to his presidency. >>harwood, thanks very much. the president is leveraging bin laden's death for his own political gain. we've got correspondent for "the nation" magazine, kevin williams, deputy managing editor. kevin williamson, why today? why is president obama in afghanistan today? >> because he wants to be president obama in january, i think is the reason he's there. it's not like he landed on an aircraft carrier in a jet wearing a flight suit. it's not as bad as it could have been. i sort of disliked the increasingly ceremonial role of the presidency and becoming sort of this general attitude toward what we think the president is primarily or in large extent a military leader.

i'm uncomfortable with these kind of triumphant overseas shows and all the rest of that sort of thing. but, you know, it's what's is to be expected because it works because voters are suckers. >> all right. why today? and is this more president obama politicizing the bin laden killing as is charged by his critics? or is there substantive work he's doing in afghanistan to deal with his mission? >> i think there is substantive work. i was on a call just before your show, larry, with senior administration officials describing a month's lead up to this agreement and the fact they are still talking to the taliban, this is a natural time to go on the soil of this sovereign nation they want to continue to prop up to handle its own security. there was very little real work to be done. everyone understands, you kill osama bin laden, you're running for president, you're going to be talking about your record. it's something we are all proud of, proud of the troops and proud of the administration that

delivered it. i don't think there's any surprise to that. >> all right. let me ask, why do you think -- here, let me rephrase it. if i were mitt romney, i wouldn't really be talking so much about criticizing the president. because what mitt said in 2007 was wrong. he had to flip it over. why not support the president? it is what it is. the president killed osama bin laden. he's over there in afghanistan, he's got a substantive mission. why attack the president who leaves the -- who goes to foreign shores? what's your take on this. who's right and who's wrong? >> the reason you attack -- obama was already accused in the commercial of so-called spiking the ball. >> i disagree -- i don't like any part of that commercial. i'm with you on that. >> okay. >> why go on to day three if you're mitt romney? what's the point? >> this isn't spiking the ball. this is running through the end zone, running home and putting it in a trophy case. setting an agreement with afghanistan makes sense. >> right. >> setting an agreement on the day that bin laden was killed,

the anniversary of that is blatant politics. everybody knows it. but to use something that even the s.e.a.l.s are complaining about now -- >> as a wedge issue, i don't like it one bit. and i think the white house has done that. whatever the president's view. they're making it into a wedge issue. but regarding the president's mission in afghanistan, that's an extremely serious business, it seems to me. and maybe his critics should suspend and be supportive while the president is on an overseas mission. maybe. >> that's the thing, larry -- >> i'm old-fashioned. i really am. i'm old-fashioned on this. >> there is a policy record here and it's one that had too with the sovereignty of a sometime allied pakistan. obama said then in 2007 we should. so it is odd both politically and substantively for the republicans to want to jump on

this. they might be better off letting it -- >> letting it go especially since the president especially implementing george bush's policy. i want to switch gears. completely switch gears. because these occupy wall street dopes, they are dopey dopes. and there's a very important article out today that shows just briefly the top 1% has gotten 93% of all the real income. that's the top 1% that they hate has gotten 93% of the income under obama. and the middle class which they chose to represent those making between $20,000 and $100,000 lost $4,500 under obama. so why are they attacking republicans, wall street bankers? why don't they attack president obama? under his leadership, the top 1% has gotten even richer. >> well, they're not as pro-obama as you would expect them to be. i've spent a lot of time down at occupy, i've heard a lot of criticism of the obama administration and his policies.

granted, what they want to replace it with is even worse. they're essentially limitless for the most part. but they're not really just mindless democratic hack, the people that are sort of hijacking it move on and the rest of the union goons are mostly mindless democratic -- i don't think they can be tarred with being overly supportive of the president. >> the problem the president's going to have is he can't meet his process. he's out there on the campaign trail attacking republicans like mitt romney or george bush saying that the 1% is too much money, he wants to tax the rich, he wants to tax millionaires and billionaires. but under his administration, the 1% has prospered even more and the middle class about which obama says he supports and rails on in support they have faired

badly. this is his achilles heel, is it not? >> the economy has always been obama's achilles heel. >> even the class warfare stuff doesn't work out for him. that's what i call ironic. >> both the occupiers and the obama administration have learned their class warfare rhetoric from the media. even the 99% and 1% thing was popularized in the media before they ever seized on it to go out and do smelly protests. so obama will of course attack, you know, attack romney who is saying he's wealthy. it's one millionaire attacking another. >> let me say something because the numbers coming out -- and these are numbers by the economists who always want to raise tax rates to 70%, but the numbers show the same evils that obama rails on against are happening under his administration. the rich get richer and the middle class get poorer. what's he going to do about that? >> i think it's true that wealth and inequality -- there aren't a

lot of hope change signs at these rallies. i agree with that. if there's a president that occupy would look up to, it would be teddy roosevelt. it would be taking on money and politics. and this is where there's connective tissue to the tea party. some of the most important energy that we see in this election cycle is not within either political party. and senator lugar who is respected in the financial community and foreign policy community by many conservatives may lose his seat over the same kind of energy which says no to a lot of the institutions -- >> all right. i want to pursue this, but i'm flat out of time. we're going to have to do this afghanistan coverage. i want to pursue. i think it's interesting, the same ills obama dislike are happening under obama. the rich are getting richer and the middle class are getting screwed. i do care if the middle class is getting screwed. ari melber, thank you. u.s. manufacturing really

booming in april, sending stocks to a four-year high. so the next big hurdle, job reports coming out later this week and ahead, the ticking debt bomb about to explode on the u.s. economy. senator tom coburn joins me here live onset with his solution. and later, president obama coming live from afghanistan. and folks, i'll just weigh in. free market capitalism still the best path to prosperity, you want to grow this economy at 6%, 7%, 8%, put some economic freedoms into the calculus. zap technology.

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all right. forget payday, market shows no signs of distress. kicked off on a four-year high fueled by better than expected manufacturing reports. let's talk. we have the co-host of the emmy award winning show sports money. and art hogan manager director at lazard managing markets. does the ism bulge in manufacturing, does that solve our spring stall worries about jobs? because there's a lot of bears that think the jobs report on friday is going to be lousy. how do you see it?

>> no, i think the jobs report is going to solve our spring lull. i think we had a lot of noise in last month's report and that evens out over the two-month period. i think people need to look at these data points like friday's data points as part of a cycle. you know, you want to look at a three-month moving average. if the average number of jobs that we're creating on a monthly basis is working higher, which i think it will -- >> you're flat out bullish? flat out bullish? >> well, i'm not bearish as the soft spot in the economy would point out. >> all right. michael, i want to have fun with this because a lot of stuff today about our friend alan greenspan who is a very distinguished man and a great thinker who sometimes is right and sometimes is not right. just like the rest of us mere mortals. now, here's where i'm going. he's very bullish on stocks. i want to get your take. he says profits are rising and that means the yield, the forward earnings yield on stocks at 7% plus compared to 2% treasuries, very attractive, buy

stocks, what's your take? is greenspan right? >> if facts are correct, larry, but the trend is against mr. greenspan. here's why, this number really sent stock prices up today, but it was lower than it was a year ago. and much lower than it was two years ago. so while profits are rising, the growth rate is decelerating. and i think that portends bad trouble for the next jobs report. >> you mean the growth rate of the economy? or the growth rate of profits? or both? >> both. profit margins are going down even though overall profits are increasing. that spells bad news for jobs report. >> all right. but i don't want to get too in the weeds. on the other hand, greenspan saying profits relative to interest rate that the standard & poors index, you turn the p/e on its head and you have a bond yield. compared to treasuries that are 2%. and actually corporates are about 5%. so does greenspan have a point that the combination of good

profits relative to interest rates gives this market a lot more value? maybe we're going to get through the old highs of what october 2007. that's not out of the question. >> it's not out of the question. i think what you do need to see, though, is that boldness of investors of this stock in cash or fixed income investments move over at some point in time. what's the catalyst to see that happen? it's either two years in a row of having just okay returns in their bond funds, or is it going to be actually the market grinding higher that drags them back in? but we haven't seen that sort of post financial crisis move out of the bond market and equity markets. >> and i think there's some skepticism on wall street's part to what mr. greenspan said. you usually have p/e multiples expand and that hasn't been the case. the forward p/e is only 13.2 on the s&p 500. it was actually a little lower than a year ago. i think that shows there's doubt there on wall street's mind. >> is that dow not bullish? i think that's where greenspan's

going. the doubt because of the yield because of the multiple that flips into a yield, 7% is attractive on your money. >> how much of that is being orchestrated by all the fed easing and fed artificially keeping interest rates low? at some point, the fed's not going to continue to be able to do that. and there goes the whole theory. >> would you like to hear the old phrase, don't look a horse -- >> when the fed gives you easy money and corporations give you higher profits, i've got to say stocks have a ways to run. >> right, and i think everyone's concerned this will be a rerun of the last two summers. what's different and you hit it on the head. we've got 2% bond yields on the ten-year. >> i'm telling you -- >> i mean with three. p/es are lower not higher than last spring and europe is less centralized, i think it's more localized. >> we will -- i enjoyed that very much on greenspan, if you are listening, my regards to you. coming up on "kudlow," america's

biggest national security problem. not what you think. senator tom coburn says it's the debt bomb. and that debt bomb is ticking. senator coburn joins me here on the set next with his ideas for a solution and we're all awaiting the president's address to the nation. we're going to have it for you live right here on cnbc the "kudlow report." this is the first car that i've been totally in love with in every way, shape, and form. it's my dream vehicle. on a day to day basis, i am not using gas.

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there's the presidential podium. you can see it at bagram air force base in afghanistan, awaiting president obama's address. and we will carry that live here on cnbc on the "kudlow report." meanwhile, republicans rode the tea party wave to regain the house in 2010. they promised an end to washington's out of control spending. but a couple years later, the federal debt ticks its way toward $16 trillion, actually larger than the whole economy. joining us now, the distinguished oklahoma republican senator tom coburn who is writing about this in the new book "the debt bomb," a bold plan to stop washington from bankrupting america. senator coburn, i've never seen a cause more just. i want to ask you, we don't have too much time before the speech. what thought do you want to transmit to those people watching tonight regarding your book? what's the key thought, the take away? >> well, i think the thing is, we have significant problems that are urgent in terms of the

greatest risk to our country. and it's not it islamic terrorists, it's our debt. and becoming informed on that, there's not one problem we can't solve as we lack leadership to solve it. us, for example, congress is not in session this week. why not? when we're running that kind of debt, that kind of deficit, the $1.3 trillion deficit. where's the leadership to say why aren't you addressing the very real problems concerning the country? >> greenspan was out today, making an interesting statement, besides the stock market views, he said the biggest mistake president obama made was not embracing and supporting the simpson/bowles deficit reduction committee which i believe you served on. >> yeah. >> and secondly, paul ryan is out today saying he wants to tear up the budget sequester deal because it cuts defense by too much. can you comment on greenspan and ryan? because they're saying different things. >> yeah, i actually have very similar quote to that in the

book that i think it was one of his greatest mistakes. >> right. >> as a matter of fact, of any president in the last four or five. i think we can cut a lot in defense. but a sequester means you cut the good programs and the bad, the same amount. and that is absolutely stupid. if you have a budget crisis in your household, you cut the things that are not working or least desirable and you protect the things that are most desirable. and across the board cut of the defense department is asinine. >> all right. so you've outlined, though. you've outlined hundreds and hundreds of billions of waste that we should be cutting that we're not. >> i've outlined $1 trillion of cuts in the defense department over ten years. a lot of my colleagues don't like that. but if you knew what i knew about the waste and the inappropriate contracting that goes on, we can easily do that. we can -- we can actually send a signal to the international financial community that we're about the business of correcting

and getting our debt to gdp ratio in a solvable fashion. and we can do it. and we'll meet our commitments to those we've made commitments. >> more coming. you can talk more about this. we're going to do afghanistan, but you're welcome to talk about your new book and the debt bomb. so for now, many thanks to senator tom coburn. the senator is sticking around with us. couple minutes, the president is going to address the whole nation. we're going to have it for you live. joining senator coburn, we'll have retired four-star general barry mccaffrey, and desert storm veteran michael grim from new york. by the way, another live picture of bagram airfield in afghanistan. that's where the president will speak. we're back in just a moment to cover the event.

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here is larry kudlow. good evening, everyone. president obama makes a surprise trip to afghanistan on the first anniversary of the u.s. raid that killed osama bin laden in neighboring pakistan. this is the president's third trip to afghanistan since taking

office meeting with president hamid karzai. we're going to go live to the president momentarily as he addresses the nation from afghanistan. the visit, a complete surprise. it comes at a delicate time in relations with the united states and afghanistan. let's go to cnbc's chief washington correspondent john harwood. good evening once again, john. >> good evening, larry. this was a very well-kept secret by the white house. there was a tweet earlier today from someone connected to afghan television that triggered a denial from the white house that the president was in kabul. he may not have been in kabul at that time, but he was headed that way. and the one-year anniversary of the death of osama bin laden is a powerful moment for him. he also, of course, his aide said on the way over that what drove this trip principally was the completion of the strategic partnership agreement with president karzai about what's going to happen once those 90,000 remaining american troops leave afghanistan in 2014. there's going to be defense

cooperation and training. but the president is going to address osama bin laden in the speech, larry. >> john, do you think there's going to be bipartisan support for the strategic partnership you mentioned a moment ago? >> i do, we heard that from john mccain earlier today. he praised the president and this is john mccain who had earlier sharply criticized the president for invoking osama bin laden in that video. >> and do you think there'll be criticism for president obama going over there and making this speech? >> reporter: i do, larry, there will be criticism. we've already seen it from republicans. but the greatest burden of the office of the presidency is serving as commander in chief. it's also the greatest opportunity if you do it effectively, here's the president taking advantage of that opportunity. >> this is an indication to them that --

>> good evening, bagram air b e base. this outpost is more than 7,000 miles from home. but for over a decade, it's been close to our hearts. because here in afghanistan more than 500,000 of our sons and daughters have sacrificed to protect our country. today i signed an historic agreement between the united states and afghanistan that defines a new kind of relationship between our countries. a future in which afghans are responsible for the security of their nation. and we build an equal partnership between two sovereign states. a future in which war ends and new chapter begins. tonight i'd like to speak to you about this transition. but first, let us remember why we came here. it was here in afghanistan where osama bin laden established a safe haven for his terrorist organization. it was here in afghanistan where

al qaeda brought new recruits, trained them, and plotted acts of terror. it was here from within these borders that al qaeda launched the attacks that killed nearly 3,000 innocent men, women, and children. and so ten years ago, the united states and our allies went to war to make sure that al qaeda could never again use this country to launch attacks against us. despite initial success for a number of reasons, this war has taken longer than most anticipated. in 2002, bin laden and his lieutenants escaped across the border. and established safe haven in pakistan. america spent nearly eight years fighting a different war in iraq. and al qaeda's extremist allies within the taliban have waged a brutal insurgency. but over the last three years, the tide has turned. we broke the taliban's momentum. we built strong afghan security

forces, we devastated al qaeda's leadership taking out over 20 of their top 30 leaders. and one years ago, from a base here in afghanistan, our troops launched the operation that killed osama bin laden. the goal that i set to defeat al qaeda and deny it a chance to rebuild is now within our reach. still, there will be difficult days ahead. enormous sacrifices of our men and women are not over. but tonight i'd like to tell you how we will complete our mission and end the war in afghanistan. first, we've begun a transition to afghan responsibility for security. already nearly half of the afghan people live in places where afghan security forces are moving into the lead. this month, at a nato summit in chicago, our coalition will set a goal for afghan forces to be in the lead for combat operations across the country next year.

international troops will continue to train, advise and assist the afghans and fight alongside them when needed. but we will shift into a support role as afghans step forward. as we do, our troops will be coming home. last year we removed 10,000 u.s. troops from afghanistan. another 23,000 will leave by the end of the summer. after that, reductions will continue at a steady pace with more and more of our troops coming home. and as our coalition agreed, by the end of 2014, the afghans will be fully responsible for the security of their country. second, we are training afghan security forces to get the job done. those forces have searched and will peak at 250,000 this year. the afghans will sustain that level for three years and then reduce the size of their military. and in chicago we will endorse a

proposal to support a strong and sustainable long-term afghan force. third, we're building an enduring partnership. the agreement we signed today sends a clear message to the afghan people. as you stand up, you will not stand alone. it establishes the basis for our cooperation over the next decade including shared commitments to combat terrorism and strengthen democratic institutions. it supports afghan efforts to development dignity for their people and it includes accountability and transparency and to protect the human rights of all afghans. men and women, boys and girls. within this framework, we'll work with the afghans to determine what support they need to accomplish two narrow security missions beyond 2014. counterterrorism and continued training. but we will not build permanent bases in this country, nor will

we be patrolling its cities and mountains. that will be the job of the afghan people. fourth, we're pursuing a negotiated peace. in coordination with the afghan government, my administration has been in direct discussions with the taliban. we've made it clear that they can be a part of this future if they break with al qaeda, renounce violence, and abide by afghan laws. many members of the taliban from soldiers to leaders have indicated an interest in reconciliation. the path to peace is now set before them. those who refuse to walk it will face strong afghan security forces backed by the united states and our allies. fifth, we are building a global consensus to support peace and stability in south asia. in chicago, the international community will express support for this plan and for afghanistan's future. and i have made it clear to its

neighbor, pakistan, that it can and should be an equal partner in this process that respects pakistan's sovereignty, interest and democratic institutions. in pursuit of a durable peace, america has no designs beyond an end to al qaeda safe havens and respect for afghan sovereignty. as we move forward, some people will ask why we need a firm time line. the answer is clear. our goal is not to build a country in america's image, or eradicate every vestige of the taliban, this would require many more years, dollars, and many more american lives. our goal is to destroy al qaeda. and we are on a path to do exactly that. afghans want to assert their sovereignty and build a lasting peace. that requires a clear time line to wind down the war.

others will ask, why don't we leave immediately? that answer is also clear. we must give afghanistan the opportunity to stabilize. otherwise our gains could be lost. and al qaeda could establish itself once more. as commander in chief, i refuse to let that happen. i recognize that many americans are tired of war. as president, nothing is more wrenching than signing a letter of the fallen. i will not keep americans in harm's way a single day longer than is absolutely required for our national security. but we must finish the job we started in afghanistan and end this war responsibly. my fellow americans, we've traveled through more than a decade under the dark cloud of war. yet here in the pre-dawn

darkness of afghanistan, we can see the light of a new day on the horizon. the iraq war is over. the number of our troops in harm's way has been cut in half and more will soon be coming home. we have a clear path to fulfill our mission in afghanistan while delivering justice to al qaeda. this future is only within reach because of our men and women in uniform. time and again, they have answered the call to serve in distant and dangerous places. in an age when so many institutions have come up short, these americans stood tall. they met their responsibilities to one another and to the flag they serve. i just met with some of them and told them that as commander in chief, i could not be prouder. and in their faces we see what is best in ourselves, in our country. our soldiers, our sailors, our airmen, marines, coast

guardsmen, and civilians in afghanistan have done their duty. now, we must summon that same sense of common purpose. we must give our veterans and military families the support they deserve and the opportunities they have earned. and we must re-double our efforts to build a nation worthy of their sacrifice. as we emerge from a decade of conflict abroad and economic crisis at home, it's time to renew america. an america where our children live free from fear and have the skills to claim their dreams. a united america of grit and resilience. where sunlight glistens off soaring new towers in downtown manhattan and we build our future as one people. as one nation. here in afghanistan, americans answered the call to defend their fellow citizens and uphold human dignity.

today we recall the fallen and those who suffered wounds seen and unseen. but through dark days we have drawn strength from their example and the ideals that have guided our nation and led the world. a belief that all people are created equal and deserve the freedom to determine their destiny. that is the light that guides us still. this time of war began in afghanistan and this is where it will end. with faith in each other and our eyes fixed on the future. let us finish the work at hand and forge a just and lasting peace. may god bless our troops and may god bless the united states of america. >> all right. that was president obama's address to the nation live from afghanistan. let's go to the white house and cnbc's chief washington correspondent john harwood for some thoughts. good evening again, john. >> reporter: good evening, larry, i think it's important to

remember that even though this is the first anniversary of the death of osama bin laden, the wind down of the wars in iraq and afghanistan are both very popular measures the president has pursued. and he tied them together. in effect, the death of osama bin laden made it easier for him to make the argument that this mission hasn't been accomplished yet, it's near being accomplished. and he tied that together at the end of the speech, larry, by saying this here in afghanistan is where the war started and here's where it's going to end. >> all right. john harwood, thanks very much. let's bring in our distinguished panel for some commentary. we have p.j. crowley, the former assistant secretary state of public affairs, retired four-star general military analyst barry mccaffrey. retired marine michael grim, and senator tom coburn still with us. john mccaffrey, can i go to you first? troop withdrawal but not relationship withdrawal. we're going to be there for quite some time training their

forces in counterterrorism and developing afghan security to destroy al qaeda and their taliban allies. is it realistic, general mccaffrey? is it doable? >> well, that's probably the more important of the two questions. the front end of it, though, do we have a choice? with 70% of the american people not supporting the continuation of the war at $10 billion a month with several hundred killed and wounded going into the second decade, it's really hard to argue another course of action. my own view is to be rather skeptical of what will happen after 2014. i'd be unsurprised if it doesn't unravel on us. i'd be unsurprised if we didn't feel that 20,000 troops spread all over the country as advisers without much combat capability would be too much at risk. and finally, i'd be unsurprised if congress will pay for continued funding of a presence if we don't have any ability to

run counterterrorism operations with drone strikes against safe havens. so i think it was a statesman-like excellent piece of political theater, but i'm skeptical in the long run it's going to work. >> thank you. congressman, michael grim, will this policy have support, first of all from yourself, you are an ex-veteran, second of all, from the republican leadership in the house? >> i think at first it'll have some. there's no question the pull on our military is obvious. the amount of post-traumatic stress, the amount of injuries, it's time to bring our troops home. and i don't think anyone wants to give back some of the success that we did have. but i agree with the general. it's going to be extremely difficult if not impossible. i've been in afghanistan, i can tell you it is going to be close to impossible -- >> you served in desert storm, did you not? >> i did. and i also went over as a member and met with the troops that

were training the afghans. and with the complete lack of infrastructure, without any ability to really go to the next level on their own, i just don't see how they don't fall back. and we're not going to have enough troops to keep them safe. it's just -- the troops they do leave behind are going to -- >> all right. senator coburn, there is an issue about whether the troop strength is going to be safe. but the second issue, we're going to be there a while, the troops may be leaving, but the relationship is not ending, and we're setting tall goals. the president said himself, nation building and security. those are tall goals, how do you see it? >> you have to look at the culture of how things operate in afghanistan. it's very worrisome to me because it's a culture of corruption. there's not transparency. the president mentioned transparency. i don't see how we get that out of there. i want to defer judgment until i see the details of the plan, the agreement we've made.

they're worried any time we put them at risk with no intention to completely win. and i think that's the problem as we pull out. what will happen as general mccaffrey, he's not going to be surprised if it doesn't work. >> p.j., welcome back as a former obama spokesperson in this state department. why did the president choose to give this in afghanistan? >> well, he went to afghanistan to sign this partnership agreement. he went to afghanistan to see president karzai. the last time he was in afghanistan, he did not have that opportunity. obviously the fact that he's here on may 1st might have something to do with politics. but i just want to come back to a key point here. in the aftermath of wars, we have done this excessively. we've stayed in japan or are still there, we stayed in south korea, we're still there. we stayed in europe, we're still there. after the war ends, there's still lots of work to do to make sure there's return on investment of the military campaign that the president says

he wants to tie down. there's also a very stern message here because afghanistan has always been a victim of hands in the cookie jar from, you know, the surrounding neighbors. this is a clear statement to pakistan we're going to stay engaged in afghanistan and you can play a constructive role, but we're going to continue to make sure that the extremists within your sovereign territory -- >> just on -- >> don't threaten us. and it's a clear statement to the taliban, come to the peace table, let's negotiate an agreement that brings taliban into the political process under the right set of circumstances. >> all right. we're going to pick them up later, but congressman grimm, you heard p.j. crowley, we are going to stay. are we obliged to stay? that's the key point. are we obliged to stay to build the nation, to protect their security, in effect to complete the task in afghanistan? is that a fair point by p.j. crowley? >> i don't think we are obliged

to build a nation. and when you look at the facts that, yes, there's tremendous amount of corruption, very tribal. and then there's another issue that no one's really mentioning. you know, does the president have the clout and the respect of our enemies to actually make these words make a difference? will pakistan respect what the president wants to do here? you've seen iran push the envelope to the enth degree because they see us as weak and perceive the president -- >> i want to come back to this key pakistani issue in a minute. we're going to continue live coverage cnbc of the presidential address to the nation. we'll be back with our distinguished panel. i'm larry kudlow, stay with us right after the break. we'll be back. [ donovan ] i hit a wall.

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all right. a few moments ago, president obama finished eed his speech afghanistan about our plans to continue american relations with afghanistan. we're back here on the "kudlow report" with our distinguished panel, p.j. crowley, barry mccaffrey, michael grimm, and senator coburn. senator coburn, at the end of the talk there was a reference to nation building in afghanistan. i couldn't think -- help think about your book the debt bomb in america. what kind of financial resources do we have here at home to help nation build in afghanistan abroad?

>> i think most americans want to nation build here. and there's not going to be a marshal plan for afghanistan. we have to wait and see what's involved in this. the real question is, what's the greatest threat to our national security. is it al qaeda or our debt? and i would say it's our debt. in terms of what will take this country down is not al qaeda. it's spending money we don't have on things we don't need and creating the debt that will totally shackle our children. >> p.j. crowley, is our greatest threat al qaeda or our growing national debt which now exceeds gdp? >> they're both. let's remember, what the president was saying tonight was we have a responsibility to make sure the guys that were sitting next door to afghanistan, you know, decimated but not defeated cannot reconstitute and attack us again. so being able to keep pressure on the tribal areas is important. in terms of nation building, you know, remember the late richard holbrook was talking about

trying to get, you know, increase the trade between afghanistan and its neighbors, exporting food, which afghanistan has been the bread basket of that region. those are small dollars that can yield the stability we want to lead in afghanistan when our work is done there. >> michael grimm, president at the end did transition from nation building in afghanistan to renewing america here at home. i want to get your take on that transition from nation building to renewing america. >> it's clearly a transition into a campaign speech. but again, there's no substance here. we can't -- we're broke. we cannot afford to build afghanistan and if we don't change our policies, we can't afford to rebuild america. and that, i think, is everything that we should be talking about. and i know that the seniors that live -- whether it's in brooklyn or staten island thinking how much they sacrifice to build this country and they're going to friendship clubs to get $2

sandwiches because they really can't afford to live anymore to think we're going to build afghanistan, it's absurd. we don't have the money, we have to change our policies and invest in america but not with these current policies. we're borrowing and spending just as the senator said and it's a destructive path. and i do believe, like the senator said, that is our number one threat al qaeda right behind it. >> al qaeda behind it. general mccaffrey, a lot of people believe our number one threat in afghanistan besides the afghanistan government itself is pakistan. and the president did allude briefly to pakistan, but didn't say much about it. can i get your thoughts? are they the bad guys in this whole calculus? >> no, not at all. looking out for their own interests, they're a nuclear state, can barely keep themselves together. it's four separate nations. only the army which is also their intelligence can hold it together. they're clearly following their own dictates. i think at the end of the day, larry, what we're going to do now is come out of afghanistan

as rapidly as we can and hope that karzai and his army and police force can keep it together as we leave. we've got no options, the american people aren't going to sustain a prolonged presence and so we're coming out. that's what the message was tonight. >> we're coming out. but we're not coming out quickly, senator coburn. >> no, i don't think so. >> that's really -- what i heard is subliminally in the last 45 seconds is there are troop withdrawals, but the united states is not pulling out of afghanistan. >> i think also to note, we talked earlier about the corruption. we can count $10 billion that's been squandered just on the supply side in afghanistan in five years. and it's continuing to go on. there's no inspector general for afghanistan, it's been vacant for nine months. >> why is that? >> because they haven't appointed someone. >> who should make that a appointment? >> the administration. >> wow. >> we're wasting billions of dollars every month in terms of

fraud and corruption in afghanistan. what we're doing right now. >> and when you add that to the cost of blood we've spilled, i think the american people have had it up to here. >> i didn't know there was no inspector general. anyway, gentlemen, thank you very much. p.j. crowley, great to see you. appreciate it. general mccaffrey, as always, coverage continues on cnbc. tomorrow beginning at 6:00 a.m. on "squawk box," that's it for this evening's show. thanks for watching. choose control. introducing gold choice. the freedom you can only get from hertz to keep the car you reserved or simply choose another. and it's free. ya know, for whoever you are that day. it's just another way you'll be traveling at the speed of hertz. uncer) most life insurance companies look at you and just see a policy.

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