>> i like to say there is always a bull market somewhere. i promise to find it just for you, right here on "mad money." i'm jim cramer. see you next time. >> the scandals and questions facing president obama and the entire executive branch just aren't going away. tonight, the biggest questions are all about attorney general eric holder, whether he lied to congress when he said this just last week. >> with regard to the potential prosecution of the press for the disclosure material, that is not something that i've ever been involved in or heard of or we think would be a wise policy. >> yes, but, in fact, as nbc news first reported and the justice department first confirmed, eric holder personally signed off to fox news reporter james rosen.

so does this mean holder will have to resign and can team obama govern for the next three.5 years? get ready for a raucous debate on this and much more. "the kudlow report" begins right now. [ music playing ] good evening, everyone, i'm larry kudlow. this is "the kudlow report." well, the long memorial day weekend is here. but there will be no break for the hard questions now facing president obama. attorney general eric holder has tough questions. the irs scandal the justice department under surveillance of news reporters and the benghazi coverup have them all under the gun. so let's talk. here now is democratic analyst and syndicated radio host mark levine, cnbc's mark acosta and author of the book "branding

america." bob, i want to go to you, bake amy, holder says never involved in the prosecution of the press for publication of material, but he approved, he approved the rosen wiretapping or e-mail tapping or g-mail tapping or whatever. he approved it. how could he have made this other statement under oath? >> it's the looming question on capitol hill, larry. expect washington to press holder for his role. one thing i'm hearing not just from republicans, why hasn't the president let him go? he is already causing headaches for the white house? they will continue tore investigations and hearings. >> i'll get your take, as you know, holder and obama are very close. on the other hand, the precious map, what we reported was apparently said, he can't lie before congress. he was unoath. >> i mean, larry, he perjured himself. so he needs to go, number one, agree with this nbc contributor. he needs to go, will he go?

i guess probably not. what more under this guy's administration can he take? he's already had several scandals this he's already perjured himself. >> you know congress. will congress come after him? that's the question. will democrats come after him and republicans come after him? the only thing i say that democrats and republicans have basically ganged up against obama on the irs scandal. the question is now they want to defend holder, too? >> you know what, a lie is a lie is a lie. i'm sorry, i hope we don't go back to bill clinton what is the definition of is, is. >> a lie is a lie is a lie. i couldn't put it better myself. by the way, the president does not want to criminalize journalism. that was what he said two days ago. it looks like eric holder has. >> remember, the republicans have been calling for leaks. back when the a.p. came out, they said, get to the bottom of this leak. this leak makes him good.

maybe eric holder is leaking this material. >> james rosin is the reporter. he's not the leaker, that's true. >> this violates the espionage act which goes back decades and decades to 1917. i may be wrong about that. so you are really not answering the question. what i'm asking you is this. what are the odds as an analyst, mark what are the odds that congress, maybe both parties will come after holder because he may have per injured himself and because this james rosen thing and this whole chasing after the media has got under everybody's skin in washington. >> i think it's far to soon. we don't know all the details about it. remember, the a.p. scandal as opposed to the rosen scandal, they asked the attorney general to recuse himself. he did. as far as the rosen scandal, we are still finding out all the details. i remember back when bush was president, it was republicans saying the leaks need to be investigated and they said it definitely with obama. >> they keep going into this,

robert, help me out on this. >> real quick. the two reasons why this is going to be a problem for the administration. you one have the press furious in washington. they can't stand the administration is going after fellow reporters, good guys like james rosen. two, you have the republican house t. republican house will press this. they will continue to ask questions. holder is the confidavenlt in walk, it has people angry in the house. that's a persistent problem with the president i think this president is going to try to address holder. he will not fester on the administration. >> the point is, one more, then i want to move on t. point is, rows were, an excellent reporter is the reporter. he is the receiver of the information. he is doing his job as a journalist. he's not the leaker. can you straighten it out? >> he is totally wrong. he has nothing to stand on because the points are weak. look, when somebody lie, when

someone perjures himself, this is what happens. if they can go on that, congress is going to go full force on that, they're going to use holder's own words to do so and don't forget the 2014 elections are coming up. this is very important on how people view this. >> all right. let me go back to my friend mark levine. it's so much fun having you back on the show. >> thank you, larry. >> i want to read you something from david axelrod, quote, quote, part of being president is there is so much beneath you that you can't know because government is so vast. okay. that's from david axelrod. now, i think government is too fast. i agree with the tea party. i think the biggest problem is it's too vast for president obama and his team t. vastest of the vast is the irs scandal, my friends. >> in the case of the ir sr s scandal what did we have? worse management. a complex irs code. remember, it's congress that has been cutting budgets for the

irs. you had a bunch of underpaid employees that didn't know what they were doing with regard to a complex section of the code around 100 years. it's about a social welfare program, not about campaigns. >> this was about the targeting of conservative and tea party groups. this is not about some rogue office in estate having too much files on their desk. >> have you lead the inspector general's report? why do you think -- >> why did lois lerner take the fifth? if it was not political, and it was not a troublesome issue, why did lois lerner take the fifth? >> why did they all cover up, robert costa, that's the thing. >> why did darryl issa cover up? >> why was the president the last to know? why was the president not informed about his senior aids about a major scandal in the irs? >> noel, let me go back to you, kim stossel's article today this chap bob bower was a campaign counsel in 2008. i think he came back for the

2012 campaign. at one point he served in the white house as the general counsel. he pulled exactly the same tactics as the irs. he would take conservative groups, 501(c)(4)s, put them up for trial. write letters to the justice department. try to push them away, warn them, embarrass them and intimidate them. the same tactics were used as in this irs scheme. i think there is at least a mental connection. >> it's a chicago pay to play foul politics. this is i said it on air before. i've gotten in trouble a lot by saying it. it is what it is, larry. i agree with her article 100%. >> everybody says, we will give you more shots. let's go to main street first, what does main street think of the scandals surrounding president obama and his entire administration? let's ask ace pollster rassmussen reports, scott, great to see you. what does pain street think? does main street think this came

from some little office in estate or is it a beggar story than that? >> we talked about the irs, 20% believe it came from some rocgu employees in cincinnati. 26% said it was irs headquarters. 39% believe the direction came from somebody working at the white house. larry, this is really a significant issue because people don't think is the norm. only 19% think the irs is traditional use to harass opponents. >> what does your polk show, how many people are following this, scott? >> well, this is a huge issue. the majority says it qualifies as a scandal. it's not just an embarrassment. 57% believe it was politically motivated. larry, the other part, six out of ten say they believe other government agencies were also involved in targeting conservatives. they don't think it's limited to the irs at all. this is the one i think is the most toxic of the three

controversies swirling around the white house. people distinctively fear the irs. remember the old bumper sticker, fight organized crime, abolish the irs. that attitude is there. the others don't hit the same level of resonance on voters. >> what's the impact on president obama? so far it looks mild. his approval rateing is down from the re-election, of course. so far, it doesn't look bad. >> the approval rate is 49% right now, about where it's been. there are a couple of hints there are some changes. number one, before the scandal on the question of who do you trust more on ethics and corruption, democrats had an 8-potent edge. now republicans have a 2-point edge. there is a 10-point swing. benghazi has taken a bit of a toll. before the last couple of weeks, 46 harris said the government was doing a good job. that's down 39%. overall, the president is doing okay t. ground is shifting

beneath his feet. >> robert costa, political in the congress, is the ground shifting also? everything with this irs story, you know the lying, the stonewalling, you can't get a straight answer from everybody. you may wind up getting a special counsel, an independent counsel of some kind. what's the political end game, bob korsa? >> that's a great question, larry, you mentioned the unfolding nature of this scandal. is this going to continue to consume washington? that's a real problem for the president. his poll numbers may not go down. his agenda could be crip crippled. it's not time for immigration reform. what happens to his second term? it almost starts to fizzle. >> noel, i'll give you the last word. >> all right. one of the things we are about to find out is we are about to find out what kind of brand obama has. he may have a teflon brand where nothing sticks on him. bill clinton, i'm from arkansas, nothing stuck on him. >> he may have to fire eric holder. >> he may have to do that.

>> throw him under the bus, which would be quintonian. >> mark levine, thank you so much, robert cost is that, scott rassmussen. switching gears, chinese investment in the u.s. is on the rise. it's not just coming from the chinese government. michelle cabrera jones me next with that story. later on, stocks closed down a week, it's been such a strong year, i will give you my take on all this obsessive federal reserve watching on wall street. don't forget, free market capitalism is the beth path to pros spemplt as usual, i will say, free market capitalism needs the rule of law. i'm kudlow, we'll be right back. .

>> when you think about the trading relationship between the u.s. and china, you probably think about american companies manufacturing products over there. but more chinese companies are investing in the u.s. and even making things here t.cnbc chief national correspondent michelle cabrera joins us now. i read one of our piece, welcome back to the show. >> okay. >> i am a free trader, you know that.

>> yes. >> i am totally, totally suspicious of everything china does. so why are they coming here? >> yeah, it depends, right, remember when you say china, it's not monolithic. when we talk about chinese investment in the united states, which is a record high, which is what i looked at. sometimes it's chinese state-owned corporations, which a lot of people are suspicious of, larry, sometimes it's wealthy individual chinese people who want to diversify away from china leak you and i want to diversify, for example, we found one company in new jersey, international vitamin corporation, about seven guys over in china have poured hundreds of millions of dollars into this company. they are manufacturing vitamins of every shape, size and sol solubility. they want to sell back to the chinese the american vitamins. they have food issues, safety concerns, made in the usa turns

out to be something you can sell at a premium over there. it's more trusted. >> i get that. actually, that makes sense. on the other hand, you mentioned state-owned companies. they get ultracheap financing from the banks the state-owned banks. a naval drone which was near a wend farm was disallowed. a couple of telecom companies the chinese wanted to buy. why? because they're going to spy on us? why? because they're going to try to get all our secrets. >> certainly the big, big headlines regarding state-owneds countries have to do with national security concerns, whether or not they're trying to buy our natural resources or using the telecom companies to spy on us. there are other state-owned companies here as well. we spoke with china construction america. this is a subsidiary of a chinese construction company owned by the government in chosen. they were famous because they built the water cube for the beijing olympics in china. here, their american subsidiary

is building schools in south chain i carolina. they're fixing bridges and train stations here in new york state. i asked the ceo repeatedly about the issue of whether or not he is getting cheap financing. he expressed a lot of frustration. he says, he tells me at least he doesn't think it's true at all. it's a competitive industry. that the banks back in china that they borrow from want to be just as competitive and are charging the same interest rates as everybody else. he denies they have any advantages. but he's going to struggle to overcome that because the vast majority, members of congress, members of the manufacturing industries here in the united states believe they are actually getting keep financing. >> so i saw what might have been your article 54 billion of chinese investment now. that is an all time high. of course, it's a 16 trillion economy. now this is an unfair comparison. but my last question, you remember with me years ago japan invested heavily in the usa and caused a real raucus.

you had congressmen smaching japanese tv sets on the lawn of the u.s. capital arc new low even for those congressmen. but do you ever think china will be of the same investment size as japan was in terms of coming here to the u.s.? >> i think we will see a lot of similaritys, what we looked back on in japan, wow, they bought pebble beach and rockefeller center for way too much money. they blew it. they were bad investors, right? i think we are going to see a mix with the chinese. some are probably overpaying because they have a lot more money than they know what to do with. i think it's a much larger economy. they surpassed japan. they invested last year 6 billion. the u.s. invested in china last year 60 billion. that's more than all the investment in united states combined so far. >> and i hope we in the u.s. keep an eye on the chinese as

they come here. keep a sharp eye. thank you very much for joining us. >> thank you, larry. all right. it's the first big beach weekend since hurricane sandy ravaged the shore. are the local businesses ready? we have a report from the beach coming up next on "kudlow." for business travelers. .

>> the jersey shore is set for

it's opening weekend after it was damaged and destroyed by superstorm sandy. she files this report from the new jersey shore. >> reporter: good evening, larry, new jersey governor chris christie opened the jersey shore for the summer. much of the coastline is resembling the scene behind me. it's a startling different picture from 2 miles south of here in sea side heights, one of the business hubs along with atlantic city. they have a brand-new boardwalk, brand-new store fronts. shop keepers hope that money spent there mean that patrons will start coming back in droves this summer. new jersey has been spending remarkably to make sure that patrons are coming to the shore. $25 million in a marking campaign recounting it is opened for business. now, a recent aaa poll found 79% of respondents would still consider coming to the shore for their vacation, regardless of

the damage and debris that remains. that is good news for a state where the third largest industry is tourism. >> many thanks. now, back to the big legal questions facing the obama white house and the entire executive branch. did eric holder perjure himself to congress last week. is irs official lois lerner still affected by the fifth amendment. do we need a special council to investigate all of this? we have assembled a legal dream team to get answers next up. first, on this memorial day weekend, we take time out to honor the soldier was remain the ultimate sacrifice for our freedom. this weekend and this holiday is about them. god bless their memories. ♪ have a gooood nig. here youou go. you, , too.

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[ music playing ] . >> i will not answer any questions or testify about the subject matter of this committee's meeting. >> mr. issa, mr. cummings just said we should run this like a courtroom. i agree with him. >> she just testified. she waived her fifth amendment right to privilege. you don't get to tell your side of the story and not be

subjected to cross examination. that's not the way it works. she waived her right by issuing an opening statement. she ought to stand here and answer our questions. >> so, did irs official lois lerner take the fifth amendment or not when she testified on capitol hill wednesday? legally, what's next for lerner, who was placed on administrative leave yesterday. let's bring in former prosecutor tom curran now in charge of regulatory crime and if we get him hooked up we have john eastman, professional of constitutional law at chapman university. he might be joining us currently. anyway, tom curran, nice to see you. what's the story? did she give up her rights to a fifth amendment? >> i don't think she did. the supreme court said it is there for innocent people and people with issues. she basically said i didn't do anything wrong but because of the atmosphere here, i'm not going to answer questions. >> why did she give an opening statement? the prosecutor now congressman

in south carolina made the.. lawyers for darryl issa making the same point, once she gave that opening testimony then all bets are off. she gave her point and they can cross examination. >> they can cross examination her without a doubt. they can call her back, have her sit there and endeavor to, she can invoke the fifth for every single question. then the question comes whether she is in contempt of congress. the invokes of the fifth amendment before congress is a limited thing in any case. congress has a manner in which to grant limited immune to the get around it for its purposes. >> if they give it to her. >> if they give it to her. >> let's bring in tom eastman, he says she did not waive her right. what's your take? >> it's a close call. if she had done that in a trial courtroom. would have been. testimony before congress and grand jury testimony is a more grey area. i don't think i would have, fiwere her laws, would have let her take that risk by making an

opening statement. it's quite possible she's waved her fifth amendment right and she won't be able to stand on that claim if refusing to answer further questions and might be held in contempt. it's a very close call. >> can i ask, john, before we get on to other issues, why doesn't the committee give her immunity? there are some people that said she did try to change the attacks on the conservative groups and she has a lot to say. why not give her immunity and let her talk? >> well, programs they will. you don't want to give out immunity to people too quickly because you may be giving immunity to the very person who is the greatest culprit. you want to try and get a little of the investigation under way first then give immunity to people that were following orders or maybe not as implicated that you are holding accountable those who are most responsible. >> right. let's move on. another legal question, but an important one. does the irs need a special council? here's what congressman stephen lynch, a democrat has to say.

>> if this committee is prevented by obstruction or by refusal to answer, the questions that we need to get to the bottom of this, you will leave us no alternative but to ask for the appointment of a special prosecutor or appointment to special council. >> here with me are tom curran an john eastman. as a special counsel? what to do here? >> i think so. a special counsel with a narrow mandate, power can find this. there will not be political accountability. you see people invoking fifth amendment and holding off against congress. there needs to be a special congress. i think the irs involvement with the department of justice and issues are that current. suggests the department of justice needs to give this to someone outside outside of their process, a narrow mandate, try to restore whatever it had the confidence in the irs. >> john eastman, i want to ask

you the same questions. i want to observe. so far these irs people either stonewall or flat out lie or now they're taking the fifth amendment. i don't see how congress with break through that unless there is an independent special counsel u counsel. >> the independents is a bit more of a myth than we'd like to believe. we can get a special council. he will be appointed by the attorney justice and is answerable to the attorney general of the united states. this controversy is implicating trust in the department of justice, itself, perhaps the white house. i think you need somebody even more independent than that. our constitution sets up congress to be the investigator in such things. i'd like to see the appointment of a special select committee where instead of individual members of congress who may not be prosecutors, they retain counsel on behalf of the committee with subpoena power for the document, quit letting the irs stonewall the

investigation. >> let me ask this, a special council. >> you can death set up their own suite of offices. how beholden are they to the justice department inner that day-to-day investigations? >> it depends on the special council. special counsel, bell did this with president carter in 1979. i happen to have known the special council. it was done with enough power, subpoena power, a power to appoint his own staff, reliance upon the fbi to the exep tent needed. if they appointt somebody who is neutral and legit, access to the grand jury is necessary. >> they can put some real one on one. >> they absolutely can. it's far spearier to anything congress does. congress grants its limited immunity. that becomes a great big fight. if there are ascent pros prosecutions and a big mess. >> i'm not against the congressional hearings. the hearings are going to go on for a while. because any special counsel is going to take a while. that's okay. that's got pretty good politics

there for the republicans. but the basic.is the, i don't see how you can avoid a special council, how you can get to these people one by one by one. there is probably a dozen or more of them that need to have the fear of god put into them. that's not going to happen in committee hearings. >> well, you know, if congress can issue some contempt citation, it might. again, i think the mulitiplicity of committees is a bit distracting. it lends itself to the false charge this is just political. i'd like to see a select committee with a prosecutor hired by that committee. i think that would advance this thing in the kongs institutional structure would without the potential lack of accountability that you might have if a special prosecutor appointed by the attorney general is investigating the department of justice or the irs. >> the problem you are seeing with congress, larry, is they're asking the people way up on the tote them pole and they're

asking questions. then you start talking to the lower level people so if you need to make immunity determinations as an investigator, you can do that without sacrificing and giving your case away. congress doesn't do that, it's a political process. it's fine. >> i think we are heading for a special council, anyway. one more question, how trustworthy is attorney general eric holder. here's what president obama said about him yesterday. >> i'm troubled about the possibility that leak investigations may chill the vekt investigative journalism that holds government accountable. i've raised these issues with the attorney generale who shares my concerns. he's agreed to review existing department of justice guidelines governing investigations that involve reporters. >> all right. can we trust holder's investigation of his own department of justice, really, john, this is like holder investigating holder. because he said at one point. this came up today, i don't know if you saw this, i never involved the pros skwugs or the

press for publication of material. he said that under oath. now, he was the guy that signed the warrant, if you will, for gmails of jim rosen an so forth. not the a.p., but rosen. how can he investigate his own doing or in this case misdoing? >> well, i think that's right. you add to that the disclosure of our confidential tax returns. we asked the department of justice for an investigation over a year ago is there who is we? >> this is the national organization for marriage that i chaired. the confidential tax returns were posted or disclosed to our political opponents, those are felonys. we asked the department of justice for an investigation over a year ago. they said, we're not going to do it. this is the organization being asked to investigate this latest scandal. >> right. tom, first amendment freedom of press is being busted here. okay. holder is bun of the busters. he's done this. no matter what he said, he signed the warrant for rosen.

so why would you go after the journalists? why not go of the leaker or the spy who gave the journalist what the journalist does for a living, ie, information? >> i'm going to say this right up front. it's unique or per vase i will be defending eric holder, but here we go. i don't understand what the investigation on the other side of the coin amounted.lto i would assume they exhausted, got frustrated and endeavored to go to the coin. what are the communications between the leaker and the reporter? >> is that even talking to rosen? you are violating the espionage act. that's a part of this. >> yeah. >> yeah. >> but they owe owe. >> holder is policing his own violation. >> what most disturbed me was the over the top search warrant which basically they said characterized rosen as an espionage agent, running agents. >> he's a reporter. >> in the battle days of the russian, counterintelligence with the russians. it's over the top. it definitely needs to be

reviewed. i do not believe the department of justice can do its own doing. i don't know what went into what did they exhaust their investigation to the other side they overreached? in there bottom line, holder should not investigate holder. i think that's really the bottom line. for all we know, there will be another independent counsel on this one, too. john eastman, thank you for helping out. now, folks to the markets. it was a wild week on the markets, people started to obsess all things bernanke. i have a take on that just ahead on "the kudlow report." [ engine revving ]

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did you know that every single piece of economic data this week has beaten wall street expectations. existing and new home sales rose, jobless claims fell, durable goods orders were on the stronger side. so why are stocks in the red for the whole week? because i think investors and marks are simply too obsessed with the federal reserve. let's talk to andy cross, chief investment officer at the pool. welcome back. this fed ob sex drives me crazy. let's suppose the fed did scale back. it's going to be slight, if i they did, sometimes in the next three or four months if they scale back their bond purchases.

this is minor, almost miniature stuff. it's earnings that drive stocks, not little weeking by the fed. what's your take on that? >> hi, good evening, larry. it is earning certainly that drives stock. the ultimate value of any business is really the profits. the fed is big with the ability for the fed to influence interest ray, of course. that does go into the valuation of businesses. so it is important on what the fed is doing, but ultimately it isn't. >> i'm not going to correct you. i'm going to add to this. the fed is not talking about changing their interest rate policy. that's very, very important. half that rate will be 0 i think for a couple more years. what i'm saying is this, let's suppose the fed scales back its bond purchase, doesn't boy as many treasury bonds, expose it from 85 billion to let's say 65 billion. that would tell you what, the economy is stronger, bernanke tried to flag. so i ask you as an investor, if the economy is stronger, is that

god or bad? >> no, that's absolutely great. i agree, i believe this will be a delicate, long drawn out process, most importantly is where the american business is and where the economy is. that's why i'm still encouraged and bullish on the stock, because american business is dog amazing things, more efficient than ever before. we have a fed that is right now accommodated. we have economic activity encouraging signs that you mentioned the top of the segment, really, home building, employment, durable goods, even good news in germany this week, to so we do have this momentum behind us, valueration not that high and if you remember, and last point, larry, is what are the alternatives? investments in stocks and equities still look the cheapest an best investment for me. >> let me ask you. this has puzzled me. the gold price has come down a lot, what, $500 bucks. i think that's a great signal for the economy and the stockmarket.

the dollar, the king dollar has gone up. i think that's another great signal for the economy, an investment coming into the u.s., but why hasn't energy, why hasn't crude oil come down? let's see, it closed today around $94. why hasn't that come down the way gold has come down and other commodity indexes have come down. >> i think oil is a life blood of the economy. when they see nice, economic activity. that will show businesses are investing, consumers are spending. we have life blood that's kind of going through the economy. >> we're producing tons and tons of oil. it's one of the greatest stories in the economy t. whole shale and fracking revolution. i just love it. so if oil supplies rising along with natural gas and the dollar is rising, then what should be happening is, their prices ought to be falling. more oil should mean lower prices. a stronger dollar should mean lower oil prices. why isn't it happening? >> we saw it certainly with natural gas. so recently, a few years ago,

that collapse on natural gas price as the supply came on, now we're seeing some of the gas prices increase as they make adjustments. so i don't want to focus too much on the price of the oil. what i'm more interested in, larry; how companies are becoming more efficient. that to me is more innovative. i think when you look out over the next two to three, five years, really, american business is going to lead the innovation scale. >> i got to get out. i agree with you, the real story of this whole recovery of stocks is the inno innovation and durability an cleverness of american business. that's what they're doing. they're making good money. andy cross, thank you very much. a question millions of americans often ask themselves, is college worth it? skyrocketing tuition costs, lack lusting college costs, former secretary of education bill benefit set about to tell us what his new book says about all of that next up on "the kudlow report."

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it's college dpraugs week for thousands of students, a happy time usually, but those students are entering an uncertain job market and in many cases carrying a huge student loan debt. that debt is the biggest financial worry for fill lennials people age 22 to 32. a third regret going to college saying they'll be better off

working. bill bennett has a book out saying "is college worth it?" i asked him this very question. >> it all depends. you say a third of people that graduate say it wasn't worth it. how about this statistic, 46% of the people who start a four-year college don't finish within six/seven years. so we say at the beginning of the book, two-thirds of people who start four-year college should probably think of doing something else. it would probably be a better idea. get a job, think about the military. try community college. physical out what you are doing first before you get all that debt. >> i want to come back to that military so forth and community college. let me stick with the financial dimension. there is over a trillion dollars of student loans. two things, bill, no. 1, these kids are going to have that hanging over them for years. i think it's demoralizing. and number two, all this federal assistance did is drive up tuitions. in other words, instead of making it cheaper, the tuitions

went up as much or more than the subsidized loans. >> i'm happy to tell you a harvard professor tells you it's the bennett hypothesis. i have a hypothesis named after me. how about that? you know how it works, if you subsidize it, you get more of it. so the government puts all this money into higher education. what happens when the universities get it through the students? they raise their prices. tuition's gown three times as much as the rate of inflation. it continues to go up. no disincentive to -- no incentive to do it any other way. so we with keep driving up the price. here's a ting people don't know. a lot of colleges tell you we raise the prices for the students who afford it, so we can raise the money for the poor students. there were more poor students in college, state of the union in the bottom kwartile, larry, in 1970 than in the class of 2010.

these tuitions and prices get so far out of hand, these kids get totally discouraged, they can never meet i. they don't want to take the debt. >> they can't get the redistribution. >> correct. >> you mentioned the u.s. military and community colleges, what might the army or the military or community colleges have over the traditional four-year liberal arts college or, you know, a well-known state school like a university of michigan? >> well, military, of course, you don't pay. they pay you. and they trane you. and that's free. you also serve your country, which is not a small thing. and you get out and almost everybody who gets out does something worthwhile when they get out. many go on to college at that point. complooun community college, remarkable bargain. we know, for example, last year, think about this, fruits-of-t fruits-of-fruits graduates tended to learn something

useful. i studied philosophy. we can argue about that. its utility. whatever. you do gender studies. you do religious studies, anthropology. it's fine, interesting, maybe. you won't get a job. the jefferson college of nursing or health science in virginia, it's graduates make more than the graduates of uv charlotte amaliesvil -- charlottesville. >> half will not get jobs, they wind up at home, they're not working. that kind of goes with the student loan burdens. this has to be debilitating to an entire generation. >> dhekelia bill advertising, paul ryan was my intern, did you know that? >> yes, of course. i was on your board there. i was there. >> yeah. paul ryan used to carry -- >> i like jack kemp.

>> paul ryan says he used to carry my coffee. now i walk around saying i know paul ryan. you bet, it's demoralizing, paul ryan talked about kids staring at the obama poster wondering what happened. it is demoralizing. they don't start families. they don't buy that house. it's bad for the economy and their spirit and morale. >> you look at the statistics of labor, college graduates have a lower unemployment rate than those that did not graduate. one thing i saw in your book, are you saying the income difference has narrowed substantially between those with a degree and those without a degree. >> it has, absolutely. now, it depends, you know, if you've got a storn daughter or grandson or granddaughter interested in petroleum engineering, they will get out making more than a harvard graduate. so, again, what are you bringing into it? what is your focus? we try to do nuance, different institution, we will make some

institutions happy and others not. >> but, no, that thing is narrowed. the jobs, a lot of the jobs of the future the best estimates we have from business council, the chamber of commerce is that by 2018, there will be 14 million jobs that will require more than a high school dip loma, larry, but less than a college degree. >> hence that community college link or whatever is in between. we'll leave it there. great stuff. former education secretary and many other important jobs. bill bennett, the name of the book, folks, "is college worth it"? it's great to see you. >> a friend, not old, thanks, larry. >> all the best. one thing i want to emphasize about bill bennett's book and what he told me. the advent of new technology, especially the internet will make a much more efficient education and chief cheaper education. he mentioned $7,000 versus $50 or $60,000. that's very important. i want to review as we go into

the weekend, our top story tonight, which is going to burn up everybody's talking points and everybody around the country over the barbeques this weekend. first, take a listen to some of our top stories. >> i'm troubled by the possibility that leak investigations may chill the investigative journalism that holds government accountable. and i've raised these issues with the attorney general who shares my concern. so he's agreed to review existing department of justice guidelines gompg investigations that involve reporters. >> with regard to the potential prosecution for the press of disclosure material that, is not something that i've ever been involved or heard of or would think would be a wise policy. >> all right. well, all this stuff, late breaking is new stuff. i mean, mr. holder, it looks like he's in trouble. he said he never got involved in the prosecution of these media cases. the reality is he signed the order which oversaw the gmail of

jim rosen, the fox news reporter. so i think there's a problem there, some people say he was under oath. i don't know whether he can work that out. already, some liberal outlets are calling for his own resignation. the other border point, is the irs scandal as scott rassmussen told us the public is highly engaged with the irs scandal. the public believes that this was not done in cincinnati alone, that, in fact, it came from washington, d.c. and, in fact, the public believes other agencies may have been involved with the attacks on the tea party groups and the other conservative groups. in other words, the irs scandal, along with the media scandal are two enormous issues. they do revolve around the justice department but, ultimately, they revolve around president obama and the white house. mr. obama, to save his own presidency, to save his own

administration, in the second term, is going to have some very difficult decisions coming up. we will see how he handles it. my last point this evening, this is the memorial day weekend. we observe that for all those who gave their lives to defending american freedom and liberty as an example of all around the world. our hats off to them. our prayer goes out to them. i'm larry kudlow. we'll see you monday. . [ musick ] i knew there were a lot of tech jobs available out there. i knew devry university would give me the skills that i needed to make one of those tech jobs mine.

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