jcpenney is bad. i like to say there is always a bull market somewhere. i promise to try it's a day of breaking news and brinkmanship. peace overtures and stern threats. that's all president obama, the president announced late this afternoon that he became the first u.s. president in more than 30 years to have direct contact with the president of iran. the two men talked about iran's nuclear plans and president obama says the conversation, quote, shows the possibility of moving forward, end quote. but the president was much more hawkish when hi spoke about the budget battles on capitol hill. he threatened republicans not to push him and he will not agree to any defunding or delay of

obama care. then president obama predicted deep economic pain if the gop does not back down. but meanwhile house speaker john boehner has decided to make a counteroffer to the clean temporary spending bill coming over from the senate. in other words, this story is not over. and this is a very special edition of "the kudlow report" and it begins right now. good evening, everyone. i'm larry kudlow. this is "the kudlow report." we are live here at 7:00 p.m. eastern and 4:00 p.m. pacific. breaking news and potentially historic news coming out of washington tonight. for the first time in more than 30 years, an american president has directly spoken with the leader of the islamic state of iran. president obama says he spoke to iran's president, rowhani, by phone this afternoon. take a listen. >> the two of us discussed our

ongoing efforts to reach an agreement over iran's nuclear program. i reiterated to president rowhani what i said in new york. while there will surely be important obstacles to moving forward and successes by no means guaranteed, i believe we can reach a comprehensive solution. the very fact that this was the first communications between an american and iranian president since 1979 underscores the deep mistrust between our countries. but it also indicates the prospect of moving beyond that difficult history. >> yes, difficult history indeed, mr. president. so is there really reason for optimism from u.s. negotiations with iran? joining us now, michael ruben, from the american enterprise institute and he's the author of the upcoming new book "dancing with the devil, the perils of engaging rogue regimes." we are engaging a rogue regime.

michael, what's behind this -- what does the president mean when he says, i believe we can reach a comprehensive solution? what does he mean by that? >> well, let's hand it to president obama. he's an optimist. however, we need to really ask ourselves just what exactly is on the table. no doubt iran wants to talk, wants to alleviate sanctions. the iranian statistical agency released a report about a week ago which found that iran's gdp had shrunk 5.4% over the last year because of sanctions. the question is whether president obama wants to offer rowhani something more than has already been declared in the united nations security council resolutions which were meant to create a path to conflict resolution, not the start of a negotiating position. >> let me just ask you about the iran and the u.n. this is one part i don't understand. enriching uranium violates the u.n. security council. and they've been enriching uranium for quite some time. and iran does not permit inspectors. so we don't really know what they're doing or how close they

are to developing an atomic bomb. what about that part of the story? >> this is actually a frustration because hassan rowhani used to be a nuclear negotiator from 2003 to 2005. and when he was defending his tenure, he defined his strategy to the iranian press as offering a great deal of diplomacy because when that happens, the west tends to let its guard down. and that provides an opportunity for iran to push forward to the conclusion of its special projects by which hep meant building a nuclear weapon. when hassan rowhani has laid out his game plan, it becomes all the more surprising that there is so much trust and so little verify on the part of this white house. >> what do you think causes this? i hesitate but i'll say -- first time they've talked in 30 years. is it the sanctions or are there other motives? >> from an iranian perspective, it's the economic sanctions. rowhani wants to relieve pressure. it takes a lot to subsidize a

country of 70 million people. and also the iran statistics agency released a report showing that direct subsidies from oil to every single iranian now trumps what even occurred during the iran/iraq war. iran is in a tough spot. what they want to do is relieve sanctions, not end their nuclear program. the question is whether president obama is going to give sanctions relief before iran delivers what it needs to do. in other words, there's a pattern that comes with engaging rogue regimes that too often american presidents and the state department claim success at just getting their opponent to the table. they no longer look at the substance of what needs to emerge from that table. >> we never have any verification of that, the nuclear weapons part. i want to ask one other thing. when the president talks about -- our president talks about a comprehensive solution, does he also infer iran's terrific assistance to syria? does he also infer iran's

assistance to hezbollah, iran basically created hezbollah, hezbollah's basically become a syrian army, may be in possession of chemical weapons, maybe not? how comprehensive is this going to be? >> the more obama tries more, the lease likely it will be to actually succeed. iran is an ideological republic. you can't assume they think like us. we celebrate multiculturalism in the united states. but it's not like going into a japanese restaurant and ordering a mojita. fundamental people think in very different ways. the iranians like to brag that they play chess while the americans play checkers. let's hope that president obama isn't simply playing solitaire right now. >> many thanks, michael. to the other big story tonight, still no deal in sight to avoid a government shutdown and just over three days. president obama laid down his sternest threats yet today.

in fact, john boehner is going to come up with a counteroffer to the senate's clean spending bill. we have the latest from capitol hill just ahead. and later, texas governor rick perry is going to join us live. going to talk about the shutdown battle, texas tax cuts and a new committee set up for him that could be a presidential springboard. meanwhile, please don't forget, free market capitalism is the best path to prosperity. i think free market capitalism is at stake in the obama care battle in washington, d.c. we'll hear much more about that tonight. i'm larry kudlow. this is "the kudlow report." we're coming right back. [ male announcer ] this store knows how to handle a saturday crowd. ♪ [ male announcer ] the parking lot helps

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welcome back to "the kudlow report." our other top story this evening, the senate approving a short-term spending bill this afternoon to keep the government open. and that includes obama care, until mid november. so now the bill goes back to the house where i'm told john boehner is going to cook up a counteroffer. nbc news capitol hill correspondent kelly o'donnell joins us with all the details. good evening, kelly. >> reporter: good evening, larry. they need a counteroffer for republicans in the house because they say it is just not acceptable for them to simply

rubberstamp what the senate passed today. and getting that passed was hard enough. we've seen a lot of drama unfolding over the last several days. now that drama shifts back to john boehner, house republicans and what happens this week. we expect that gop conference members will meet tomorrow. they'll all get together, have their strategy session. and they've got some different options. what can they do? they can offer a short-term -- really short-term, like a matter of days sort of extension to take some of the heat off of everyone. they could offer an extension that would delay the implementation of the health care law but keep the government kopitaring. those kinds of variables are being considered. we don't yet know how john boehner will proceed and even if he'll feel like he has to go toward democrats to get their help to get something passed to avoid the government shutdown. it is high stakes for john boehner in terms of leadership because if he turns away from the most conservative members of his conference who do not want

to go forward without taking every step possible to block the health care law, he puts his own leadership in peril. if he doesn't do something, he puts the government operation in peril and certainly lots of americans are upset about that. a difficult, challenging weekend for john boehner ahead. now, the senate has gone home for the weekend. they're not back until monday afternoon. the house will be here and we'll be waiting to see what their plan "b" or plan "c," however you want to describe it, will look like. larry? >> you said this and i don't get it. the senate is out of session until 2:00 p.m. on monday. the deadline for fiscal year is 12:00 midnight. let me get this right. between 2:00 p.m. and 12:00, they're negotiating a plan "b" with all the bells and whistles that go with that. it's not credible to me. it's just not credible. >> reporter: it's a sort of "take it or leave it" move from harry reid and the democrats in the senate who feel like they

pulled something off and really were able to come to a solution by holding off the conservatives. there were 19 republicans who took the step to -- it was one of the intermediate steps but they tried to block this going forward without the health care law in it. so since they were able -- democrats had a victory today. they were able to pass an extension that takes the government through mid november and it does not include anything that would tamper with the health care law. so basically by senators going home, they're not here to negotiate. so harry reid's in effect saying, take it or leave it, john boehner. >> maybe john boehner will have to make long distance phone calls -- >> i have a feeling harry reid is still in town. >> he's in hiding. many thanks, nbc's kelly o'donnell. we appreciate it. house republicans are going to meet behind closed doors tomorrow, allegedly to plot their next move in the spending fight and frankly sources tell me, speaker boehner is, in fact, cooking up a counteroffer. so who better to ask than house

members, peter welch, the chief deputy whip of the democratic caucus, and the chair of the republican study committee. gentlemen, welcome back. steve, i want to ask you, is there a gop counteroffer being cooked up and what will it be? >> larry, it's good to be back with you. we are here working. we've laid a number of options on the table. we're going to continue fighting to make sure the government is properly funded while also making sure we're addressing the problems with the president's health care law and pushing for delay of a law that the president himself admitted is not ready for primetime. barack obama has given delay after delay to the special interests, to people who get access to the white house, but he refuses to delay it for regular middle class families. so we're fighting to delay it, not just for the privileged class in washington but for all american families who the president say it's not ready for. >> you've used the word delay, which is important in this

discussion. with senator joe manchin coming out in favor of a one-year delay of the individual mandate, you're only four senators short up there. so let me ask -- will mr. boehner and all of you come up with a one-year delay of the individual mandate? will that be the counteroffer? >> larry, i think you're seeing a lot of movement behind delay of the president's health care law. exactly how the details are going to be worked out, we're going to work through that in the next few days. but if you look at what senator manchin said, there are a lot of other people like him and there's mounting public pressure. when they look at the president giving delays to the special big businesses, to insurance companies, even to members of congress, people say, wait a minute, if this law is so good, make it apply to everybody. not just the people that can get exemptions by going to the white house and getting special favors, but give that same relief to everybody. >> let me bring in peter welch. what do you think of that? one-year delay for the

individual mandate? there are other things on the table, the medicare device tax cut is on the table, as steve said also the exemption, congressional exemption from obama care. but i think the individual mandate, particularly is the toughest one, peter. what do you think about that? >> the toughest thing is that the debate here has as a premise that it's okay to shut government down and default on our obligations. and the president and the senate are not going to negotiate on this. so there's kind of a self-serving fantasy that's going on. we've got to call to question, either we're going to have a clean c.r. where we vote to keep the lights on and then we have six weeks to negotiate everything or we have a shutdown. it's really in the hands of mr. boehner and the republicans to decide what they want to do. if they reject -- if they do a counteroffer, the senate's not here, they won't pass it, the president won't sign it. they have to make a fundamental decision to call to question. and if they really think it's time to shut the government

down, it's time. >> peter, with all respect, i'm not hearing that. when boehner spoke yesterday, he's not talking shutdown. when i talked to his senior staff member and the same for eric cantor, i don't hear them talking shutdown. they might have a temporary four or five-day bill -- c.r. to keep the thing going. senator harry reid says today, steve, to john boehner, addressing boehner, he says, pass our bill or it's a shutdown. now that suggests to me that he's the one talking shutdown. >> no -- >> look, larry, if president obama wants a shutdown, if harry reid wanteds a shutdown, that's their business. we're making sure -- we're going to make sure that there is not a shutdown. barack obama has already said that he'll negotiate with vladimir putin. he'll negotiate with the head of iran but he won't negotiate with house republicans to make sure we keep government properly funded. i think it shows you he's being

unreasonable in this. we're here working, working on every option we can to make sure government is funded while addressing the problem that every business in this country is talking about, and that's the president's health care law. >> bottom line here is the government is going to shut down on october 1. and if there are these demands that we relitigate the obama care that's been approved by the supreme court, it was really decided by the american people in the last presidential election and it's just a drip, drip, drip of the lost cause battle to try to stop it and using it as a tactic to even shutting government down, we're not going to get anywhere. this is over. and really the fundamental decision is totally in the hands of john boehner. will he put a clean debt ceiling on the floor? he doesn't have the authority to do it within -- >> barack obama is giving exemptions and waivers to everybody who can get access to the white house. it's not saying the president says this law is working. he's given over 1,400 waivers to his political friends. >> but i've been here and listening to your colleagues.

you guys have a disagreement on obama care. you want to kill it. that's a fair and square battle. but the president's not going to agree. >> regular families are saying, wait a minute, why isn't it good enough to give me a waiver if everybody else can get a waiver if they can get high-priced lobbyists. that's how it works. >> it's not at all how it works. the individual mandate, the implementation of the changes is starting to go. >> it's a disaster. >> so is your point of view. but there's a difference here between you and me -- >> take james hoffa's word. he's said this is going to destroy the middle class workweek -- >> i must say, peter, with respect, i think you and every observer has to be surprised at the huge volume of glitches that has occurred as this thing gets up.

computer glitches and software glitches and verification glitches and personal safety information glitches -- these things are endemic of why large bureaucracies cannot run all corners of the country. >> if we were having a discussion where the premise was that we're going to make this law work and there are glitches we're going to attend to -- i'm having hearings in my own state to work out whatever the problems are. anytime you have a major law, you have to work with the people affected. but that's not what's going on. there is a battle that is continuing from day one to defund and destroy obama care. and it's fair and square for the republicans and steve to have that point of view. >> it's not just republicans. it's james hoffa, the head of the teamsters. it's senator manchin. it's senator baucus who called it a train wreck. it's a bipartisan agreement that this thing is a disaster. >> the legislative process will take its course. the house is going to come up

with a proposal, send it back to mr. reid. we'll see what happens. the senate is not even in session until 2:00 p.m. on monday. i don't really get that. congressman peter welch, appreciate it. steve, thank you. you heard what the congressman had to say. but that countdown to a government shutdown is still ticking. we'll bring in our experts who join us with their brilliant commentary up next on "kudlow." aw this is tragic man, investors just like you

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welcome back to "the kudlow report." i'm kayla tausche. the dow closing at a down week with a 70-point today. the dow losing 1.25% for the week. but a great september with a 3% gain. today the biggest drag on the markets, fear about this government shutdown. the president said the dangers are unknown because congress has never before threatened default. that, you can be sure, will continue to weigh on wall street. >> it's going to be great fun. many thanks, kayla tausche. three days and counting to a potential government shutdown if congress doesn't approve a short-term spending plan. but with president obama still refusing to negotiate with republicans, is such a thing really possible? let's turn now to cnbc contributors jared bernstein and robert costa. welcome, gentlemen. robert costa, you're running a story at the top of the

"national review" online website. and you're basically saying that boehner is going to come back, at least that's what i heard, that boehner's going to come back with a counteroffer. but it was senator ted cruz who really got the conservatives in the house to push boehner in that direction. is that true and what happened? >> the ted cruz talk-a-thon has changed the dynamics among republicans on capitol hill. instead of trying to pass a so-called clean c.r. and fund the government over the weekend they want to fight until the 11th hour and attach a one-year delay of the individual mandate to a c.r. >> i think personally -- i think with joe manchin coming over and supporting that, you need four more votes. i think that's a possibility. and i think that should be the gop position for a lot of reasons. some are political. some are just the glitches in the program. and some is that the individual mandate is at the heart of obama care.

why not go there and make it simple? >> you reflect the sentiment within the republican conference. the conservatives want that to happen. here's the problem. as much as you want it and conservatives in the house want it, harry reid, the minute that passes the house can strip that language out of the bill and send it right back. >> jared bernstein, what's going to happen? you've been around for a couple of these. i've been around for a couple of these. how is it going to end up? >> if the house pings back something to the senate with the kind of changes we've been talking about, there will be a shutdown. however, you've mentioned this yourself in passing. if included in that bill back to the senate is something else, a very short-term c.r., something that says, okay, we'll argue about this during the next week when we keep the government going at current spending levels, so a week-long c.r., they would be sending over two things -- one would be the amended c.r. the other would be

this mini c.r. that's the only way that we don't have a shutdown. >> the reality may be -- by the way, i think they are going to have another short-term c.r. to try to nesht this. the other reality worth considering is that harry reid will never let that vote on the floor of the senate to delay the individual mandate. he'll never let them vote on it. >> you said it correctly. the individual mandate is at the heart of the law. the employer mandate, not so much. the congressional budget office estimated if you postpone the individual mandate for a year, 11 million people would not get coverage who otherwise would in the exchanges next year. so that's a real problem. and, yes, i think harry reid is -- his spine is just where the president's is on this. you heard the president today. he's just not going to negotiate on that. and frankly, i don't think he should. i was listening to the congressional debate you just had, and i thought steve was

actually sounding kind of reasonable. but the thing is, they're not really being reasonable. what they should be saying is, we're going to keep things running, we're not fooling around with the debt ceiling and we're going to sit down and try to fix things. mend it, not end it. that's not where they're coming from. they want to end it. >> robert, almost everybody agrees that the individual mandate, the whole thing has been a disaster. glitch after glitch after glitch. so many constituencies being affected. i don't care how good the computers or software, no government can run a fifth of the economy, period, end of sentence. >> what about medicare? >> they won't do it. they can't even transfer the data from this obama care to medicaid. that's one of the other issues. robert costa, what happens to the gop? do they eventually give in on the c.r. and try to do something on the debt bill or are they just going to fight to the

death? what is senator cruz suggesting to those republicans in the house? >> he's been saying, speaker boehner may want to have a long-term battle on the debt limit, do something in a couple of months from now. but senator cruz wants to fight right now on the c.r. he doesn't want to wait to have a debt limit fight. that's putting pressure on speaker boehner to not have a clean c.r., to have a lot of things stuffed in this that they ping back to the senate. this is a problem for boehner. at the same time he wants to make an argument on obama care, he knows his hand is a poor one. if the government shuts down, likely republicans will be blamed. >> i don't understand one of your premises, larry. yes, i get it about the glitches and there will be glitches in a rollout like this. but what about social security or medicare or medicaid? those programs are actually run quite seamlessly and are very much beloved by all their recipients. >> jared, that's right. that's the fear republicans have. that's why october 1st is so important right now behind me on

capitol hill because they really believe some people will like the program and it will become institutionized as a new bureaucracy and federal program. >> i have to make this the last word. i'm going to take it. besides the bureaucracy that bob costa mentioned, the fact is social security, medicare and medicaid are all bankrupt, period. and that is one of the great problems and stories of our time. and unfortunately neither the senate nor the house has come to grips with the fact that those age-old entitlements are bankrupt. we are looking at a $600 billion or $700 billion deficit if we calculated it right. and that's going to be one of the key points. i have to get out. >> can i please come back and debate that with you? >> yes, another time. jared bernstein and bob costa, thank you very much, gentlemen. now it's time for our next special guest, texas govern rick

perry is about to join us live to talk about the shutdown and taxes and more. he joins us. texas, the texas economy, stick around, folks. governor perry is coming up. i was made to work. make my mark with pride. create moments of value. build character through quality. and earn the right to be called a classic. the lands' end no iron dress shirt. starting at 49 dollars.

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what's president obama's solution to gridlock that has washington on the verge of a government shutdown? what's the solution? looks like it's negotiate with iran, not congressional republicans. i don't get that, okay. anyway, joining us now, texas republican governor rick perry. as always, governor perry, great to see you. thanks for coming back on. >> thank you, larry. good to be with you. >> i want to talk about all that the texas company and your new group. but let me get your informed opinion. if you were in washington, d.c. now, what would you advise the republicans to do this weekend? >> a week ago, i thought -- i still held out hope that washington had just a modicum of common sense and that they would come together, talk about the issues. when you have the unions that are so vocally against obama care, when you have the private sector understanding this is nowhere near the bill of goods

they were sold, so to speak, that the democrats might see that we need to sit down and fix this. harry reid pretty much put that to bed and the president put that to bed today when they said they're not negotiating with anybody, it's their way or the highway. here's what i suggest will happen. the republicans are going to do everything that they can to continue to draw light to this, that this is bad public policy, it's going to bankrupt states. that's the reason joe manchin -- he's been a governor before. he understands this. he says we ought to push back the individual mandate for a year. i agree with him. it makes sense. it is a really broken piece of legislation that is going to -- here's what's going to end up happening if this thing goes through. the american people will defund it because they will figure out very quickly what an absolute pig this is. >> they will stay away from it. >> yes, they will. >> they really will. young people will stay away from this thing. we've been having segments on

this show many times. you think, just to close this down, i want to get to your new committee. but you think basically boehner should have a counteroffer and more than likely that ought to be a year's delay for the individual mandate? >> well, look what you've got right now, the bottom line is that harry reid's probably got the votes. but there's some sensible senators there on the democrat side that i think understand how important it would be to have this individual mandate addressed. i know the republicans want to see this thing defunded. and frankly that's the best position. but i don't know whether we've got the votes to do that or not. but at the end of the day, the american people are going to defund it. >> have you talked to senator ted cruz, used to be an elected official in texas, about his campaign? have you spoken to him this week? >> i haven't. but i admired him standing up on

the senate floor and giving them what-for. it was a high moment in my television viewing. >> i agree with that. americans for economic freedom, a new group you are starting up. can you tell us about it? >> well, the answers to the challenges that face america are not going to come out of washington, d.c. not on health care, not on education, not on transportation infrastructure. it's going to come from those 50 laboratories of innovation in the states. it's going to be governors working with legislatures. and americans for economic freedom is -- they were put together and i wanted to participate with them because i believe in their vision, i believe that blue state versus red state policies need to be talked about across this country. and then the states compete against each other. that's the beauty of our 50 states out there. some of them, those policies will work well as the tax and regulatory and legal policies in texas do. and there will be some disasters like california or illinois or

new york, states that are losing massive amounts of wealth to other states because they're overtaxing, overregulating. but that's the beauty of this. people will figure out where they want to live, policies that they want to live under. one size fits all will never work in america. we see it with obama care and we see it with tax policies and regulations. >> so you're going to use this group -- i just want to understand. you're going to use this group as a platform to push those free market, low-tax poltss. i heard you had a nice session with governor o'malley who doesn't agree with you. but if i'm not mistaken, the texas economy is growing a hell of a lot faster than the maryland economy. he's been raising taxes. >> the texas economy has created -- 30% of all the jobs created in the last ten years were created in texas. it's not theory anymore. you keep the tax burden low, have a regulatory climate that's

fair and predictable, a legal system that doesn't allow for oversuing, you put accountable public schools into place and then get out of the way and let the private sector do what the private sector does best. it works. texas is proof of it. you look at louisiana, look at florida, look at new mexico, south carolina. all those states, they're red states, i might add, with governors that have a real belief that you can't spend your way to prosperity, you've got to control the spending and have tax and regulatory policies that are fair and predictable. those are the states that are getting ahead today. the blue states, they're pushing people out the door and there's a big translocation of wealth and people that are happening in america. but that's okay because it's the synergy of those policies in those red states that are creating more jobs for america. >> governor, last time we spoke -- in fact, you were here on the set with me. i asked you if you were considering a run or the president. you left the door open. i want to ask the question

again. only be the right thing for me to do. are you considering a run for the president? >> the door is certainly still open. but the great news is i get to be the governor of a very dynamic state for the next 15 months working with a group like americans for economic freedom. i'm going to enjoy not only selling texas and selling the state of texas. but working with groups like this one that are going to be really pushing this debate forward across america about states' competition and how we make america stronger and a better future for our children. >> free market capitalism, the best path to prosperity. we appreciate it, sir. today we had historic contact with iran. tough talk from president obama on the budget battle and still more glitches with obama care. we're about to tackle all that and more. please stay with us. ♪

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and make a difference... together. welcome back to "the kudlow report." i'm kayla tausche. federal authorities raided the headquarters of virginia-based lumber liquidators. the stock sinking 10% on the news the immigrations and customs fovrmts along with the d.o.j. and u.s. fish and

wildlife service exercised a warrant to search the property. the company says they are cooperating. no word on what was found. >> thanks, kayla tausche. appreciate it. from the year-long employer mandate delay to the small business enrollment delay, the list of obama care glitches, problems, program pushoffs is growing on a daily basis. to wit, today, nebraska officials announced the delay in some people's ability to get medicaid coverage through online obama care enrollment. and republican congresswoman renee elmers of north carolina is raising another red flag. obama care will actually create health insurance monopolies in most areas of her state. bluecross blueshield will be the sole provider in more than 60% of north carolina counties. don't all these glitches help make a good case for pushing off the individual mandate for a year or maybe longer?

a key democrat in congress, senator joe manchin would support a stopgap spending plan that delays the individual mandate. joining me now, we welcome kathy arue, kellyanne conway and jim pethokoukis. i'll start with you, kellyann, all these computer glitches, there's a million of them. software glitches, verification glitches, there are personal security glitches with information. i don't think this stuff gets solved on a weekly basis. i think this is endemic. when the government tries to take over a fifth of the economy, this is the stuff that happens. we saw this in western europe and we are going to see it here. >> to be clear, the glitches you talk about are real but all the delays you showed in the graphic, this administration

told us obama care is the best medicine for the entire country, they're the ones now requesting the delays. i want to make it clear to your audience. the ones requesting the delays are not ted cruz and john boehner. they're barack obama's administration. he's busy talking to the presidents of iran and russia, not to john boehner. we can't get him to talk to congress. that's a serious point because all this happened for a simple reason -- i have no evidence whatsoever that this president really cares what ends up being, quote, health care reform as long as it can be in line to his legacy. as long as his biography says, barack obama first african-american president, first president to recognize marriage equality, saved us from the second great depression, killed osama bin laden and then finally, semicolon, passed historic welfare reform. does it matter what the delay is and who got covered in the end? i don't think he's that kind of person. >> i just don't agree. i feel that he does want to have -- he wants to pass it and

he doesn't want delays. he's just warning the american public that there are glitches. it's a warning. and he was being polite just to say, this is going to happen -- >> kellyanne makes a good point. >> where is he today, by the way? >> he's talking to the president of iran. >> exactly. >> he's essentially dodging the problem, i think, number one -- >> he's warning americans that there are going to be glitches. >> but, look, if you take the business mandate off the table for a year, if you take other things off the table, these computer glitches are gigantic. you can't even switch tracks. you can't get people to medicaid or -- >> technical glitches. >> why not take a time-out? >> if he takes a time-out, he's going to risk losing the momentum -- >> the house. >> he's going to risk losing his obama care so he has to go -- >> his legacy, his legacy. >> it's not a legacy. >> if it's a fantastic program that americans are dying to

have -- there's a tremendous need for health care, we elected this president, we reelected him, why would a one-year delay kill the momentum? in the private sector, they have various beta versions they roll out. they get a lot of feedback. they modify things and say, listen, we're going full speed ahead right now -- >> you don't need one year. >> listen. the fbi decided they were going to get a brand-new computer system. in 2001, nobody could talk to each other. last time i checked, it's 2013. that computer system never worked. it's 12 years later. we need maybe a 12-year delay. >> the data hub for security -- i'm not an expert on this stuff. but the data hub has never even been tested. never tested. it's going to take a while. and that's one of the most important parts of this, as you know. >> right. >> what's obama afraid -- i understand the politics. i understand the republicans are making a run at him. but if he's so confident about this, then why not take some

time out and agree with some people in his own party and say, let's have a delay, what's wrong with that? >> he's actually saying -- he's giving the warning. he's saying, let's put it out there and let's just work through these glitches together -- >> so when you go on the exchange, there will be a big screen come up, you've been warned. >> right, right. >> the last time i heard about -- >> he's preparing the public. >> the last time i heard about a complicated logical effort that they decide to just not test and then launch was the campaign -- >> basically what the president said today and it's not the first time is "over my dead body." that's basically his position. he's being very -- he and reid are going out of their way to insult boehner. whatever position you are, republican, democrat, okay, let the games begin. i've been in the process. you've been in that process. we've all been in that process.

but those guys, they don't play well with other children. i think that's really going to be a long-term problem. they just don't. they can dish it out. but can they take it when it comes back to them? >> but the law passed. >> implementation is october 1st. today's september 27th. >> so let it pass. >> some laws pass and then are taken back when they don't work. >> aren't we all clear the employer mandate has been delayed one year by this administration. the same administration has requested a one-year delay and the employer mandate -- joe manchin said it was reasonable and sensible -- >> he changes his mind every other week. >> are you disavowing him? what about mary landrieu? >> they're democrats by name sometimes. >> you're saying obama is trying to warn us. he's not a traffic cop. he's the president. >> i have to get out.

but i think if you could get a vote on a one-year delay for the individual mandate, there's 51 votes for it. stick around, everybody. i want to know if this entire budget battle is going to continue. is this the gop's last chance to stop the march of status economic destruction? there i go. i said it. it's the free market friday panel returning next up. i just don't want the government to run the economy. that's all. i'm kudlow. we're coming right back. i was made to work.

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back with our panel. i'm going to begin with you, kathy. put your analytic hat on. many republicans believe that this battle right now, continuing resolution and maybe the debt ceiling battle is their last chance to stop obama care. >> right. >> do you agree? >> yeah, this is their moment. they're taking it hostage. this is when they're going to do it, during the budget battle. >> there's no delay -- >> they're taking the country hostage right now. >> they haven't taken the country hostage. >> just the house of representatives. you have the white house and the senate, you know that, right? what do you mean holding them hostage? >> they're trying their best. but it's not going to happen. >> it's very simple. if you voted against obama care in march of 2010, you cannot in good conscience vote or

principle vote to fund it. that's like saying to two 15-year-olds, you're too irresponsible to drive but here's a brand-new car and here are the keys. >> it passed. it's not an issue. >> you're so cavalier about it. the president's administration now has all these delays. spanish-speaking people, medicaid eligibility people, employer mandate, small business mandate, you keep saying it like it's ted cruz and john boehner standing in the way of it when it's the obama administration -- >> i want to raise the stakes here a little bit. maybe i'm too dramatic. but i really see this in part, if you're conservative like myself, like yourself, you believe in free markets, this is almost a battle between good and evil. on the one side, obama care is the status, big government, european-style program. and on the other side, conservatives want free markets, patient power, consumer competition and choice.

so this is a big thing. i think that's why ted cruz tapped in so big because that's -- he made the broad-brush arguments about freedom. i want to ask you how far that's going to go to the spirit of what cruz is doing. >> it's certainly reenergized -- certainly in the house. it wasn't so long ago we thought, listen, they'll fight about the c.r., they'll move on, go to the debt ceiling, nothing's going to happen. he totally energized them to fight a lot harder. the health care plan is a lot of regulation. it's washington-run. it's top down. highly regulated market element. it's everything if you believe in free market economics -- even if you believe in some of the health systems of other countries which have a level of government involvement like switzerland, this is far to the left of those, you can't embrace that ever. >> jared bernstein raised this earlier tonight, i didn't understand.

those other entitlements, social security, medicare, medicaid, are broke. do we not learn anything from that? they're broke. >> they're undertaxed. >> kathy, kellyanne, jim, thank you. that's it for tonight's show. thanks for watching. i just don't believe in the entitlement state. i'd rather have free markets and free choice. i'm larry kudlow. see you on monday. oh this is lame,

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