don't miss "mad money's" chart week. it all starts monday. i like to say there's always a bull market somewhere and i promise to try to find it just for you right here on "mad money." i'm jim cramer. see you next time. in a remarkable and shocking about-face, president obama proposed a complete overhaul of our surveillance policies. this after defending them for months. all in response, i think, to nsa leaker edward snowden. the president also took time to bash republicans for threatening to shut the government down over obama care, a threat by the way that no leadership republican has actually ever made. and stock markets took it on the chin with their first down week since june. the dow was down 233 points overall for the week but consumer credit ratios are the best in 33 years. china is stabilizing. and even europe is looking up.

and coming back home, why is it that hollywood celebrities continue to rampage against natural gas fracking. the evidence proves they are wrong. and they are costing blue collar jobs especially in new york and california and do we really need this socialist 101 movie that's coming out tonight? i guarantee you it bombs. all those stories and much more live coming up on "the kudlow report" beginning right now. good evening everyone i'm larry kudlow. president obama held a news conference to announce new steps to prevent abuse of the nsa surveillance program. nbc news' own steve handelsman joins us now with all the details. good evening, steve. what are the high points, in your judgment. >> reporter: if you're in russia today and you're the admitted nsa leaker, you're the alleged

american traitor, you're edward snowden and you're watching this white house news conference here today, you had to be smiling. president obama number one ordered a look at the nsa phone data recording program. he ordered that the court that oversees it no longer just rubber stamp all the nsa requests. he ordered more public disclosure by the nsa and he impanelled a group to make further recommendations. the president saying he wants the public to see the nsa the way he sees the nsa. >> all these steps are designed to ensure that the american people can trust that our efforts are in line with our interests and our values. and to others around the world i want to make clear once again that america is not interested in spying on ordinary people. our intelligence is focused above all on finding the information that's necessary to protect our people and in many cases protect our allies.

it's true, we have a significant capability. what's also true is we show a restraint that many governments around the world don't even think to do. refuse to show. >> reporter: president obama said he had already on his own accord thought about asking for changes in the nsa, looking into the process, but he admit, larry, that edward snowden accelerates the process. >> yeah, that's the key points. he thought about it. i'm sure. i think about a lot of important things, steve handelsman, and so do you. it was only in recent months where president obama was defending all these surveillance programs lock, stock and barrel. seriously. against criticism from his own party and from even many in the republican party. what changed his mind? friday afternoon, august, humid weather all of a sudden he comes out with this. what's your take? >> reporter: i think the public

definitely reacted like the public always does when the public finds out about vast programs the public didn't know anything about. which is why edward snowden said it's a good idea to put it out, wikileaks style. let the american public decide. the initial rush from democrats and republicans, senior people on the house and senate intel committees and all the lawmakers like that who are kind of lean right on national security they all cued up behind these programs said thern terrific, let's leave them alone and condemned snowden and the public weighed in and the lawmakers put pressure on the president to take another look. that doesn't mean the programs will be changed. the president saying if the american people knew what he knew about these programs and how carefully he says they are balanced to protect americans and to protect americans' privacy then they would support them. keep in mind the president of his four things, one is to modify the nsa's phone data

recording program and number four is to put together a panel to look at other modifications. nsa will be changed. >> absolutely. you're going to get -- aren't you going to get a real backlash. i don't know if it will start in the sunday talk shows this weekend or not. i reckon it will. you'll get people in both parties to say he, mr. obama is weakening this whole program. we're going hear a lot of that because he was defending it before. and both parties, steve handelsman. >> reporter: correct. >> that's the deal. and all hell is going to break loose. it's happening right now. it will start this evening. nbc steve handelsman, thank you very much. you're a terrific guy. here's the question. did nsa leaker edward snowden cause president obama to make a complete about-face on surveillance policies that he, in fact, defended for many months? it's an important question. here now on set my free market friday panel.

i begin with you, because a lot of republicans who didn't like this nsa, a lot of republicans that did, but the whole party was split over this, democratic party was split over this, what happens now? where does this thing go? >> i think you're going to don't see that same split, right, because it's a split between the li bench rtarian split on both sides and conservatives and national security democrats on the other side. but what often happens when there's a democrat president the liber libertarian wing of the republicans comes to fore. >> that almost lost a vote for fundsing the nsa. >> i think this is a response to snowden. it's clear pure and simple. i agree with what steve handelsman said. if i were snowden, i would have a big smile on my face because it looks to me like snowden

moved obama. you agree or disagree with that? >> i do agree but i don't think he moved him far or move him far enough. you're right. this was about saving face. this was weird this press conference. first of all he made it clear he doesn't intend to change the program itself. this was more about restoring faith and this notion of distrust which he blames snow debt. when we talk about distrust from my perspective back in march during the congressional hearing when we saw ron widen ask james clapper the director of intelligence if in fact there was surveillance, if they were collecting data on americans we saw his response was no, sir. when he was asked again about, you know, ballpark figure as to how many americans phone records were being taken or gathered or collected, the defense was i think laughable. i think the defense was that that would be an invasion on their privacy. what obama was doing in this situation was just trying to

obfuscate which he did on jay leno as well. he said point blank they are not spying directly on americans which is not true from my perspective. i don't know what his definition of spying is. >> he's using the fisa court and i think they are not directly spying on americans. that's my own personal view. but jim let me go to you. any changes in any part of these programs will require legislation. i mean there were huge battles over a decade ago after 9/11 where george bush to get the patriot act through. huge battles. i want to know is obama ready? does he have the stomach to go into a legislative battle such as he's going to have to have? he wants this committee to report in 60 days that's going to fix the foreign surveillance court, 60 days. he's also got obama care coming up in 60 days and also a continuing resolution coming bin 60 days. do you think he has the stomach for this? >> no. he hasn't shown the character or

shown the leadership to be able to do this because look that. he did this press conference on a friday. on a friday afternoon during the middle of august when hoping some people weren't watching and i think the real reason why he did this press conference and why it was so much about the nsa and the spying, was because he saw his negatives in the polling going up over 50%. there's several national polls right now that have his disapproval ratings over 50% and he's got real problems with his base and he was talking to his base today. he was saying know the spying is not that bad. the worst thing in the world that happened him to was after the whole snowden thing came out he looked weak but then you had a lot of people saying he's just like george bush which was real bad with his base. >> what i worry about -- >> he's worse than george bush that need to be clear. >> worse in what way >> on the surveillance program. >> worse meaning tough center >> tougher in the sense he's being covert, not being

transparent. as a senator he actually was very critical of the provision in the patriot act which actually allows for the government, makes it legal for the government to actually collect information on american citizens. and i think, you know, this was again all about restoring public faith. to your point it was rallying his base and trying to say it wasn't as bad as these disclosures. you saw the dea, intercepting and funneling intelligence and covering it up in phoney investigations. obama is realizing he's going to lose support on this issue. >> i'll ask before we move on to different parts of this press conference but i want to ask you he, of course, he said that snowden is not a patriot. that's really all he said. he didn't have any nasty things to say about snowden and i thought that was very interesting. >> obama totally vindicated edward snowden today. he's smiling in russia. not only that. think about what future leakers will think. futurer leakers will think if i

leak like edward snowden did i can get the president to respond to my agenda and get asylum in another country. he set a preaccidents there will be future edward snowdens. there will be ton of other cases like this. >> to me, the nsa is going to be furious over this, the other intelligence agencies. he just in one fell swoop lay it on a friday afternoon in august changes the whole game and sets this on a course that they are going to have massive legislative bouts. let's move on. another topic from the president's press room his choice for the next federal reserve chairman. please take a listen. >> i think both larry summers and janet yellen are highly qualified candidates. there are a couple of other candidates who are highly qualified as well. i'll make the decision in the fall. >> i want to go to you, you're a democrat. you're on the democratic side. you understand obama in ways that i probably don't. what did he just say?

in fact, what is he saying about the whole thing? >> i can interpret it. i don't mean to be critical of obama. i'm the democrat here. >> i understand. >> this week the truth is we've seen him not necessarily be clear on a whole host of issues. this is quite frankly as a democrat a record that a precedent he set unfortunately on a whole host of issues. so i'll have to defer to you. >> wall street hangs on his every word when it comes to the fed chairmanship. it's an important job. but he defended larry summers but said summers is not my man. he defended janet yellen but maybe i'm not going to go with her. there are other outstanding people. are there other outstanding people or is it a two horse race? >> think he's leading from behind again. i think he doesn't know what he's going to do right here. wall street, a lot of folks in the business community they would love to see larry summer. but, i think, again he has real problems with his base. one of the little dirty secrets -- >> gender politics.

janet yellen, not monetary politic, not about the there are, not about the inflation rate, not anything about gender politics. >> he wants to deep war on women going. >> i'm not so sure about that. i think he wants summers. he mentioned susan ricin that press conference. of course he eventually dropped susan rice. he fiercely defended her because he wanted her. he wants larry summers. >> let's go back to susan rice. he didn't push hard for susan rice. he put her in the nsc. >> the senate said we'll not confirm her. we'll filibuster and that's when she or he relented. i don't think the republicans in the senate will filibuster summers. he's the one guy who makes noises towards a bit mormon tear hawkishness compared tomb else that obama is considering. from that standpoint he's the most friendly candidate from both sides. >> i'll tell you one thing that

it liked about this. he said he wants to do a mandate on employment and inflation. i always had trouble with a dual mandate. he did mention a sound dollar. he actually used the word sound dollar. that's very close to my argument about king dollar. that's what the fed ought to be targeting is the dollar and maybe a commodity close rule. somebody has done some pretty good briefing but we don't know who it's going to be. >> the truth is when it comes to monetary policy they are not that different. summers versus yellen but you were mentioning the woman thing. >> she's more dovish. >> perhaps. the concerns around summers the way it's been reported there are new concerns how he treated the african-american departmentally while in harvard and i think that's all fair game. >> federal reserve, never heard of it before in my life. whatever. new york's governor andrew cuomo fiddled a major economic opportunity finally flew the coop. i'm talking about a fracking

plan that's no longer on the table in a depressed area of the state of new york. question, are politicians like cuomo delaying fracking because they are under the influence of ignorant celebrities like yoko ono. first she broke up the beatles, now she's killing jobs in new york. that's next up on kudlow. don't forget free market capitalism is the best path to prosperity and that includes fracking. we'll be right back.

this is the pursuit of perfection.

well it doesn't like fracking will be coming to new york any time soon. chesapeake energy has all but given up drilling in the empire state. they walked away from a two year legal fight. hollywood of course is partly to blame for all this. why are these hollywood lefties with their socialist movies ignoring the facts by opposing fracturing? fracturing would create a huge volume of jobs, new jobs, good paying middle class jobs in new york and california and elsewhere and studies show it is not an environmental hazard. anyway an editorial in today's investors business daily says whatever their reason they won't be stopping any time soon. that's the hollywood crowd.

joining me now is the author of that piece. he's now vice president for policy at the texas public policy foundation. he is the author of the texas model, prosperity in the lonestar state and lessons for america. chuck, i kind of had my eye on matt damon on this. matt damon and that goofy movie he had where the school teachers tried to stop everything and you see that kind of crap coming out of hollywood all the time. how do they get away with that? >> because you have a confluence of powerful money and interests and the natural proclivity of hollywood to be against free markets and a socialism for everyone else except for them. in the case of "promise land" the matt damon movie earlier this year that flopped, many people would be surprised to here it was mainly financed by the united arab emirates, the

leading nation in opec as far as natural gas exports. >> we're going steal their bacon, that's what's going to happen here. there's no question about that. these hollywood guys instead of standing up for america would rather stand up for abu dhabi. chesapeake energy, okay, major fracker driller, okay, great company, they gave how much? $26 million to the sierra club to attack coal plants and god knows what else? chesapeake energy trying to blame and bribe the sierra club? do people know this? that's incredible. >> that was a four year effort called beyond coal from about 2006 to 2010. of course when you shut down a coal plant it's usually replaced by a natural gas tur bin driven

plant. there's a pretty much one for one market share issue there. so probably made good business. the irony is once they were called interest and they stopped paying the sierra club the sierra club turned on chesapeake and went after natural gas too. >> sure. we've had michael bruin on here many times. leapt me ask you what do you think about this. we just had another study from the department of energy saying fracking is clean. fracking does not cause water problems. and new york is high bound, cuomo, governor cuomo who has done some good things but not this, afraid to buck robert f. kennedy jr., afraid to buck yoko ono, afraid to help upstate new york which has been in a depression for 50 years. why. >> in hollywood their voice speak loud and money speaks loud whether it comes from an image nation in the "promise land" or

not. there's a lot of speculation around fracking still. however, i think there's a lot of misinformation that's being put out there. for example, the earthquakes and tremor, some people are perhaps putting them out of proportion saying they are worse than they are. in real life it's like drilling. but also i think you have issues around people who are trying to influence the way that america relies on i'll or gas. >> natural gas is clean. it will make us energy independent. >> doesn't it depend geographically where you do it. in the united arab emirates they have different technologies and they don't want america to advance their technologies in order to be more dependent. >> that should not be matt damon's problem. jimmie let me go to you on this. hollywood, they are stopping it in new york and also stopping it in california. there's a lot of shale formations in california which

hasn't done any drilling in decades and decades and they are hurting the blue collar worker. this is a case where a bunch of rich actors and actresses are really hurting the middle class blue collar worker. >> it's terrible. the first thing, by the way i tell the fracking industry to do is to change what they call it. fracking has been demonized. it's been demonized by the left. they should call it clean energy exploration. you're exactly right. talk about who is hurting the middle class. who is hurting working america. look what's going on in places like the dakotas and texas. they have virtually no unemployment. they can't fill the jobs. >> pennsylvania. pennsylvania. ohio. these are states near here. they are like us. >> and the reason why andrew cuomo won't do it is because he's running for president and he wants to get the support of the environmental groups and that's exactly why he won't, he doesn't support it. >> here's the amazing thing.

environmentalist left says they are the party of science and the free marketeers are anti-science. it's so hypocritical. there's no scientific evidence that fracking does anything to absolute the water supply. >> that's thing. >> yet they are claiming that it does. they are misrepresenting the scientific data, teen epa says there's no evidence. >> do you think yoko ono reads studies. does she read the newspaper? what does she do. >> variety. >> here's the opportunity. the opportunity is that somebody within the industry, within the petroleum industry, the natural gas industry ought to get with the program and start engaging in culture. culture influences politics more than politics influences politics. and where are the free market films celebrating this american success story of applying technology to revitalize america's i'll and gas industry. >> i want to ask you, chuck, before we go, this new movie

which i'm calling socialist 101," elyseum" this is the worst of the worst. you have a bunch of rich people and everyone else is getting screwed in this movie and they all will be in revolutionism. this is another crazy hollywood fantasy i think that no one will go to. >> in all likelihood it's not heavily attended because americans have an affinity towards free market and don't appreciate it when well paid actors and actresses push socialism for the rest of us. >> for the rest of us. they are all rich. didn't "promise land" bomb? >> it did. it only grossed half the money that abu dhabi put into it. >> a lot of people saw it. >> a production, even a bomb, a million people saw it. compare to it the two documentaries out there, frack nation which looks at how the journalistic community has

completely misrepresented fracking and on the other hand gas land which is the environmental left documentary, those films brought in so far a fraction of the audience of "promise land." >> what's wrong with matt damon. why can't he do the "bourne identity." what's wrong with matt damon? how can he not understand -- go ahead. >> the only thing i was going to say. fracturing makes it impossible to produce i'll and gas where conventional technologies doesn't work. for as much as we're quoting studies the perception i hear from the left they say there's not enough technology, enough sign tick evidence even though you're quoting a lot of it to feel confident there's not problems down the line. it will be solved by wind mills. wind mills on nantucket. >> that's the irony. >> chuck, thank you very much for laying that out. i tell you, i did not know

chesapeake energy gave all that known the sierra club. that's hilarious. arrests may be imminent in the jpmorgan london while case. that's next up on "the kudlow report". [ shapiro ] at legalzoom, you can take care of virtually

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>> good evening. that's exactly right. u.s. authorities planning to make two arrests in the case according to the "new york times". it's the manager and low level trader in charge of recording the bets. they are accused of hiding the size of the huge loss. both are in london but could be arrested there next week and eventually extradited here. meantime the u.s. international trade commission is ordering a ban on the import of some samsung devices that it says infringe on two apple patents covering mobile devices. this is the latest in the patent disputes. moving to a corporate battle, act being chairman of the sec is disappointed and will consider appropriate action if the time warner cable and cbs companies don't resolve their dispute independently. not clear what she would do or could do to resolve the situation. customers are getting worried. the pga championship is this weekend, nfl season starting in a month. >> you got it. both big plays.

both on cbs. all right. jackie, thank you very much. now, folks time to do some stock market and economic work. we're starting to get some more good news on the economy even as the rally took a pause this week. but there's tons of important economic numbers that come out next week that will affect interest rates and stocks. we'll show you what you need to know just ahead on kudlow. ♪

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welcome back to "the kudlow report". i'm larry kudlow. excuse me. retailers in the red, some horrendous numbers out of the retail sector this week. whatever happened to spending. this could make for an interesting back to school season. courtney regan joins us now with all the details. good evening, courtney. >> reporter: retailers july sales haven't inspired much confidence for back to school. traditional mall based retailers have warned investors about weaker than expected july sales and an impact to earnings when the companies report later this month. discounts at local malls haven't enticed shoppers outlet malls are a different story. here at woodbury mall there's lines to get in some of the stores. saks and nordstrom are banking on the outlet boom.

nordstrom announced four more rack locations last month. >> the vacancy rates at outlet malls are running about 5%. you're seeing on the traditional retail side probably somewhere between 10% and 15% as far as the vacancy. so they obviously are seeing a lot more traffic. >> reporter: the teens are interested in coming to the outlet malls for the discounts on designer accessories. we've seen big lines inside coach. >> all right. many thanks to courtney regan. so with markets in the red for the week what is weighing on investors minds. here's larry glazer of mayflower investors and dan greenhouse chief global strategist. all of this bad news on the retailers. on the on the other hand, big news story, americans with best credit in decades drive u.s.

economy. okay. this is from a rival news organization but they are pretty good. household net worth hit a new record high and consumer borrowing as a share of income the lowest in 33 years. now that to me is optimistic. >> listen, when you go back and take a look at you brought up the net worth argument. other than the two bubble peaks, other than the period of time for the housing boom and the dot-com bubble, we're at a net worth disposal income ratio higher than anything we've seen. in that regard americans have built up some of their lost net worth. they just think to some degree they should be richer than they are because we spent ten years convincing them that's the case. >> larry, the other side, you've gone after consumers that's where the trouble was in the stock market. i'm going after it. i bet you want to say there is good borrowing going on. there's credit card borrowing with very low delinquencies rates. home delinquencies are low.

whatever happened this week, whatever happened to these companies and their announcements the consumer looks awfully healthy. >> sure. again, larry, this weakness we saw in certain subsectors of retail, some retailers show weakness. that's not a reflection of the consumer as a whole. in fact the consumer is very healthy. and may in fact shifting some of their patterns in a bullish way. if you look what the consumer is doing look at home depot, lowe's, home improvement much more leveraged to the overall economy. >> if i can jump in here. he makes a lot of good points. lot of companies are doing very well. i can't believe anybody would make the case that the consumer is very healthy or doing very well. that's not the case. while we're focusing on

particularly aeropostale but i don't know how we can sit here and say everything is hunky dory. >> we've seen stubbornly high gas price. the consumer has been resilient in the face of all that. many shifted some of their patterns coming out of the austerity shell is a better characterization. shifting those pat teshs in the practical way. you can't have it both ways. the consumers have done their part. they won't lead the recovery. they have done their part and the consumers paid their dues. >> let me ask you, dan, you got a lot of important data points next week including retail sales. retail sales, industrial production and housing starts. what do you expect to see? healthy, better, worse, what? >> i think at this point five years into the obama presidency, five years or four years into the recovery from the worst

crisis we had in who knows how long, i just -- i can't -- there's no way to say the next two years are going to look any different than the previous three years. that is to say the great recovery that's always just been around the corner is moving further and further away. >> what about the ism reports which came in very strong. we've had other good data points. >> there's bright spots. >> car sales are very strong. what do you with that stuff? >> again over the last three years we had momentary instances of oh, optimism and enthusiasm only to eventually see the gdp numbers come in at 1 1/2, 2 1/2. there's no reason to think that the next couple of quarters are going to be any different. >> hang on a second. stick around. we have to talk about profits. profits is the mother's milk of stocks. one expert says if you strip away the banks corporate profits were actually totally flat, zero, zippo. we'll talk to that expert up

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as earnings season begins to draw to a close let's do a recap. profits did better this quarter than they did last quarter, but

apparently it was all because of banks and financials which put up 28% growth in earns per share. the rest of the story was zippo, zero. let's talk to michael farr from farr miller in washington. he recently penned this piece, taking stock of s&p earns. take out the banks, michael and it's zero, no profits at all? >> it's pretty close to zero not on the profit side really but on the revenue growth side, larry. you and i have been talking about how long you can continue to grow earnings if we don't grow top line revenues and the earnings we saw positive up 28% would have been about, i mean still a little positive without the financial, which are about 16% of the s&p 500, but on the financials on the revenue side it was up 8.6% compared to 2.9% in the first quarter and a lot of those earnings came from draw downs against reserves. it wasn't so much they were expanding business lines, but

they were reaping some of the profits of excess reserves. >> so what does that say about the rest of the s&p 500? what you're saying is profits were flat. you said they were negative. >> the way we execute earnings if you exclude the financials it was negative. >> excludeing financials growth was either flat or slightly negative. >> not good. >> that's the point. michael, you know i believe profits are the mother's milk of stocks. i hadn't heard this before. you were post fronted of the cnbc website. what does that mean for the third quarter, what does that mean for the fourth quarter. >> it's bad news is good news and deep south fed at the table longer. i don't expect them to start tapering in september. they won't have the conditions to let them see -- they all said everything they will be conditioned restrained and conditional depending on what employment looks like. i don't think they are going to

have the environment in which they can really begin to taper. i think that's going to be good for stocks and keep a tail wind in place. >> agree that the feds should not taper in sep but they will at some point later on. let's bring back our financial geniuses. larry glazer, you're bearish right now, is that right? >> yeah. look, i think michael makes a good point. if you can pick one sector with strong earnings wouldn't you want it to be the financials because it's a reflection of cycleality and reflection of the overall economy. materials and energy are not contributing and negative. it's positive to see one sector that's a good barometer. we saw fairly good news out of china and the market didn't react. the only markets that have been reacting is china and european banks. i might want to shift some of my domestic assets that appreciateed into some of those

undervalued assets. >> commodities did very well off the china news. china looks like a stabilizer. made very good numbers this week. commodity rally, commodities are cheap right now. >> listen, the china story is one where you have to always start off by saying we can't believe everything that they say. but with that said it does appear as though the rate of deceleration is waning. >> can i come back to where we were before. retail sales, industrial production, housing and consumer prices. next week. is it going to be positive or negative for the stock market? i don't want that to slip through. >> i'm unequivocally, i disagree with michael farr. i think good news is good news. i can't root for bad earnings growth. good news is good news. i have to believe it. >> larry glazer is good news good news or not.

>> good news is good news. it tapers off in the market. we know, it's out there. the bond market was surprisingly cooperative this week. when you look at the bond market you say we know all. don't worry. play golf. don't worry about the fed. worry about walmart ears earnings. that will tell us how the consumers really do. >> what your buying? >> i think, again, we talk about opportunities shifting some money overseas. a lot of value there. people are afraid of the overseas markets. institutions are shifting money into foreign large cap multinational but cheap and an income play april avoid domestic income place. if you want to fly look at fertilizer stocks. they got destroyed this week. >> the cliche, dan is buying europe. do you buy buying europe. >> on my twitter feed i should the european indices and s&p since the bottom, so to speak and every single european

indices is above the s&p. >> so you would buy europe because it's cheaper is that what you're saying. not because it's going to grow. >> johnson indic >> european indices have been cheap. >> larry glazer you can't be buying the emerging markets can you? >> of course you can. that's where the opportunity is. >> really? >> absolutely. absolutely. absolutely. you got to look. you don't have to buy china but there are companies with real balance sheets that really make money that are real capitalists out there. invest that money. there's plenty of opportunity long term in the emerging markets. is going to ride through a lot of volatility and most people can't stomach that and hiding in some appreciated domestic income place and that's not a great answer. >> we'll leave it there. appreciate it very much.

now we have a break through on immigration reform coming in the house. or is this just a decoy. some democrats are now claiming they have enough republican votes to get a reform bill passed. we'll talk about next with our free market friday panel. stay with us on kudlow.

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democratic representative luis gutierrez of illinois thinks he found enough republicans to support a bipartisan immigration bill. take a listen to what he said.

>> if they ask me today go find those 40, 50 republicans, i would tell them i found them. i know where they are at. they are here. they are present. >> all right. so, does the house really have enough bipartisan support to pass an economy boosting immigration bill? that's what i think. immigration reform is pro growth. here now is my free market friday panel. let me begin with you on this. 40 or 50 republican votes i don't know, got be a republican bill and i don't know how boehner will handle it. how close are we going to get to an immigration bill >> the restrictionists are worried about what happens if the house passes anything even if the house pass as very conservative border security bill that a lot of the conservative restrictiontionists say then that can be hijacked by the senate to pass the gang of eight bill and that will go

conference and the democrats will all vote for, the democrats in the house will vote for gang of bill within the conference along with 50 or so republicans. that's the nightmare scenario for the restrictionists and that's why they are concerned about the parliamentary procedure. they are worried it will get hijacked by the senate. >> erin shock, a smart guy he says that the eric cantor alternative, i want to be very clear about this, eric cantor and the house leadership has an alternative vision of the president's dream act. okay. where they let the young illegal, the young illegals get some form of legality and maybe ultimately citizenship. that tells me that there's a softening going on in the republican side and identify also talked to some republicans. how far away are we to some kind of comprehensive approach? >> i think we're pretty close. and i think one of the things that people don't realize, i think virtually everybody wants

immigration reform. we know we have to do something. i think both on the right and on the left. the biggest problem you had here in a lot of ways people look at really the barack obama bill that came out of the senate that barack obama, harry reid and i know there were republicans that supported it also they look at it as being a bad bill for a lot of different reasons. >> it had flaws. >> no question about it. but i think what you're going to see here is a lot of republicans come together led by eric cantor who i think is one of the real true reformers in the house and try to get something done, something that will protect american workers and something that's good for the economy but also something where we get some good border security and that's what folks are looking for. >> one thing, paul ryan is putting his reputation on the line. there's no question about that. and he amounts to a lot. he carries a lot of weight. and i think part of the solution here, part of the solution has to be more visas.

more brainiac visas, more student via sass, more low-income via sass. that's a key to get a good immigration reform bill. >> i agree with you. statistics prove exactly what you're saying a lot of these small businesses are started by these people who have these and do come to this country. i agree with gutierrez. you want stricter borders that's fine but there is to be pathway to citizenship. especially for the dreamers. wouldn't it be nice to have a bipartisan effort where this does happen. for optics so much of politics is optics. it would re-energize the country. >> i agree. i like the sound of that at least on that bill. but the restrictionists are out in full force in the republican party. no question about that. to sell them is going to be very difficult. my pal ann coulter will go whole hog against that. >> our friends at national review. >> my pals at national review. my own editorial board. i don't know how to get around

that. >> you were saying, jim, you thought that everyone is in favor of immigration reform. i'm not so sure about that. there's a whole contingent of people opposed of the idea of giving amnesty or legalization to any one is a form of sanctioning law breaking they oppose any bill even if it contains a lot of good things because it would do that. >> most americans and all the republicans that i work for -- >> what do the polls show. >> they are not isolationists. people want immigration reform. they want a pathway to citizenship in a way that's done that it doesn't -- it doesn't hurt the people that did it the right way, the immigrants that are coming in to this country, they did it the right way. >> what do your polls show? >> the polls show americans want immigration reform. >> and some republicans do. you're right. you point out paul ryan he's there in chicago opinion these negotiations are happening. >> really important. ryan is really important to this process.

he really is. i'm sorry not enough time. thank you very much gentlemen. i'm larry kudlow. that's it for tonight's show. thank you for watching. ♪ [ male announcer ] you wait all year for summer. ♪ this summer was definitely worth the wait. ♪ summer's best event from cadillac. let summer try and pass you by. lease this cadillac srx for around $369 per month or purchase for 0% apr for 60 months. come in now for the best offers of the model year. we've been bringing people together. today, we'd like people to come together

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>> the following is a cnbc prime original. >> sometimes a revolution can begin suddenly, without notice. this one begins on a january afternoon in 2009, when a man named janis krums boards the ferry for his commute home from manhattan. >> that day was like any other day. very cold day. >> they set out for the short ride across the hudson river, same as always. then comes the announcement. what's the first indication to you that this trip is gonna be unusual? >> the captain going on the speaker, saying there's a plane in the hudson. >> just moments earlier, a