three winners now, vf corp, mellon and financial prudential, with gains of at least 2%. that does it, right? >> going up to 50 this weekend. 50 is the new 70. that will do it for "power lunch." >> have a great weekend, everybody. see you on monday. "street signs" begins right now. well, it has now been five years since the legendary bottom. our beloved colleague called it. what would mark say today? we have investing road map for the next five years. is there turmoil at the top of our good friends at pimco? inflation nation. you won't believe how much food costs are rising. even if you hate taxes, one big tax may need to go up and fast. >> indeed. happy friday, everybody. have you got your party hat on? >> no. >> happy fifth birthday boom.

get your party hat on. come on. you should know this is the birthday of the bull market. it is only the sixth bull market in the post-world war ii era. to celebrate its fifth birthday. as for today, let's take a look behind me. despite losing our early gains, we still hit record highs early in the session for the s&p 500 and dow transports, for that matter. we are also higher for the week across the board. five for five week for the nasdaq here behind me, even though it is down today, and four out of five for the dow and s&p and by the way, the dow at one point earlier today came to within less than 100 points of its all time high. brian? >> wow. getting close. all right. thank you very much. we begin with a story that's really captivated wall street's attention, the growing he said/he said in the fight atop pimco. a reuters article saying bill gross accused mohammad el-erian of trying to quote, undermine him and the reporter said gross told him he had evidence that

el-erian actually helped write the february 24th "wall street journal" article about their deteriorating relationship. are you following all of this? because i'm not sure i am. let's get to the bottom of it. joining us is gregg zuckerman, the man who ostensibly penned last month's article entitled "showdown atop pimco." we have been working together for a long time. i deeply respect you. you are a great writer. i will assume you wrote that article. did you or el-erian write the article? >> well, i wrote it with colleagues. i have to make that clear. yeah, there is all kinds of talk and speculation but we obviously stand by the reporting and we talked to, as we say in the story, nearly two dozen employees, current employees, former employees of pimco, and it covers all kinds of years. it covers years when el-erian wasn't there, it covers years when he was there. so there's a lot we wrote about and we stand by it all. >> but did el-erian have any

input whatsoever, even a small part, into the article? >> obviously, you know, shoe's on the other foot here. we can't talk about who we talked to, who our sources are, that kind of stuff. again, when you talk to as many employees, current employees, former employees, you know, it's something that we are confident in, we stand by the reporting. so people can take shots at it but we are very confident with it, my colleague and i. >> well, listen, obviously bill's a friend of the show. he's not a personal friend of mine, i don't hang out with the guy but i have been interviewing him like you have for years. so has mandy. i like bill very much. what do you make of all this stuff? do you think that gross is right at all in what the reuters article quoted? >> listen, it's a difficult time in the bond market over the past year, going forward with tapering. obviously managers are trying to

figure out where to go going forward. pimco has a lot of talent there. they may more than almost anybody in the business so that's why they are able to attract talent beyond both mr. gross and mr. el-erian. to me, if they can allow these managers to do their job, they can continue to do really well. >> thank you very much for joining us. adding your voice to this. we also want to bring into the conversation eric jacobson. he covers pimco for morningstar. great to have you with us. to what degree has this impacted the fund's performance? to what degree are we seeing anxiety about the fund? >> well, thanks for having me. i think the first question, it's really hard to draw any line there. i don't think there's anything we can point to about the fund's performance that has necessarily suffered directly as a result of all this. but more broadly, i think that everybody's going to be keeping a very, very close eye on assets and fund flows over the next few months to see what kind of

impact it may have on investor decisions. >> it's got to have some impact, don't you think? >> i'm sorry? i didn't hear you. >> no one ever said that to me before. it's got to have some impact, don't you think? >> i think what we're seeing right now is a lot of competitors are definitely out there hitting the streets, talking to clients, pimco clients, of course, and at this point, i don't think that they're trying to necessarily get everybody to dump pimco. i still think that's a pretty tough argument to make. but i think that their strategy is to try and convince clients to maybe peel off a little bit of money that they do have with pimco and diversify it, and you know, that used to be a really, really hard task. i think at least people are listening now. whether or not it's going to flow through to big numbers, i don't know. >> very quickly, at what point does [ inaudible ] step in? >> that's a hard point. despite what greg just said and you guys have been talking

about, they have fantastic talent, deep, deep bench at pimco but ultimately the company is identified with and to some degree, shaped by bill gross. if you are allianz, certainly you own a terrific franchise and great infrastructure and you have lots of great people. but bill gross is the secret sauce there. even just in terms of what investors expect. so it would be very, very difficult for them to do anything that wouldn't perhaps further damage pimco itself by trying to get too involved with gross and potentially getting him to hang it up. >> real pleasure. thank you for joining us. >> thanks for having me. let's bring in bill griffeth from cnbc. why? because bill wrote a book "the mutual fund master." he's known bill gross for years. we also have peter mirajanean. >> sorry about that. we'll get it right next time. i will get to you in a second.

bill, what can you tell us about bill gross, the man? >> the thing that's always struck me is how soft-spoken bill gross is. for a guy who works in such a hard-driving industry, we all know people who work on wall street here and many of them are type a personalities. bill gross is very much a type a personality but doesn't wear it on his sleeve. very soft-spoken. for this kind of conflict, and let's face it, tell me you have never had a personality conflict in an office somewhere. >> with mandy? who could? it's impossible. >> right? >> it is possible, trust me. but very quickly, bill, is there an element of paranoia that seems to be appearing in some of the things being reported about bill gross' behavior? >> i guess. i don't know. bill doesn't strike me as being the paranoid type. he's very secure in his job. he has this reputation of being the bond king. he's had it for years and years. but pimco, i think you hit on it earlier, brian, this is his baby. he founded this back in the early 1970s. think about it.

40 years ago is when pimco was founded as part of pacific mutual life. this is his baby. he runs things at pimco, make no mistake about that. was there a personality conflict with mohammed, who by the way we all know as well, is also a gentleman and a soft-spoken personality, at least in public. will they be different behind the scenes? could be. was there some jealousy, was there a personality conflict, who knows. but i will say if you want to talk about how to resolve this, everybody should just settle down and keep quiet. i think we wouldn't be talking about this again today if there hadn't been this reuters article. >> very good point. that's a good time to bring in peter as well. it is never good for two very prominent corporate leaders to have what is becoming a public spat, is it? how do they resolve this? >> that's the point. i agree with a lot of what's been said so far. what surprises me, i think allianz has to step in to issue some sort of statements to reassure investors.

there is always the delicate balancing act, do we want to take the mole hill and make it into a mountain. i understand that. but at the same time, what you're having is unnamed sources going back and forth, former employees, current employees, and it's all being waged in public. allianz needs to step forward and say we remain confident in the direction of pimco and the leadership, and we look out for our investors. something that just reassures the street and reassures the markets. >> we got to leave it there but we appreciate your insight. thank you very much. >> thank you. it has been five years since our beloved mark haines called the market bottom and boy, was he right. in those five years, the s&p has more than doubled, the nasdaq, get this, guys, up 241%. now it is time to pay it forward. joining us now, a pair of five star fund managers with their pick for the next five years. guys, don't think just because it's five years hence that you can get away with this. you are going to be accountable. we will call you back in five

years' time to see whether your picks were right. what about you, eric? you've got three picks. make your case. >> okay. we like cross tex energy which is well positioned over the next few years to benefit from opportunities in the midstream pipeline infrastructure market. they just entered into a transaction that's going to give them the financial flexibility to take advantage of those growth opportunities over the next five years. the company generates nice cash flow, has a superb management team and we see nice upside in it over the next several years. we also like eagle materials which is a manufacturer of cement and gypsum wallboard. both these industries are in the really stages of a cyclical recovery. they are seeing nice pricing power for both cement and gypsum wallboard which should help them leverage their fixed costs and see nice earnings improvement over the next few years. the stock's had a nice run this year but we still see further upside in it.

then lastly, i will mention delfrisco's, a restaurant company that has a unique secular growth opportunity which is being driven by their grill concept, which is a new concept that should allow them grow their store base at double digits, has very attractive cash on cash return metrics and we see really a nice runway over the next five years for that concept. >> they are pretty much packed wall to wall 5:00 p.m. on monday through sunday. george, let's move on. one of your picks, an off play of what eric was talking about, right? forget about eagle materials. we need all the asphalt to replace the roads. lkq can help us repair the car because of all these roads. >> this is interesting. this is a real play on the auto business, the auto recycling business. recognize when you get in a car wreck, you don't have any interest in that car anymore. you want to move along, get another car.

on the other hand, lkq will buy that car, recycle the parts that are in there, so that they are able to go ahead, get another car refurbished with recycled parts. that seems kind of strange because you assume when you get a repaired car that you are getting original parts. if you look in your insurance contract, it says they have to replace with like kind and quality. therein lies the rub with this company. they own tons of scrap yards around this country. this is an area that a lot of people don't want to get their hands dirty with. we, on the other hand, do. this company has grown to 25% per year. we think they will earn $2.58 next year. it's a cheap company by any measurement. also a green company. that's very important for a lot of folks. >> george, i could open up my wallet today and there is probably not more than $2 in it because i always use credit cards. and debit cards. i.e., we are a cashless society, increasingly. you have a play on that. >> here, we have a lot of credit and debit cards. internationally there is still a lot of room. there are a lot of people that might say europe, that's a bad word nowadays, i don't want to

invest in europe. what's important is that what we try to do is buy companies when they are cheap. so it's a very important company. they are in 150 countries, with 16,000 atms around the world. they've got over a million points of sale in their network so they have their hands in all sorts of money movement, migrant workers, gift cards, that's where society is going nowadays, away from cash. fast moving company, very interesting, attractive opportunities. >> we appreciate all the picks and the opportunities for the next five years. eric and george, guys, thanks. have a great weekend. coming up next, food costs are soaring. the price of about 80% of your grocery items just year to date. how much higher will they go? we find out the best stock plays for your portfolio so you can hedge your grocery bill. we kind of talked about it. pothole nation. that's me driving to work today. you will see the video of the roads around here. like the oregon trail. [ male announcer ] this is joe woods' first day of work.

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a really good thing there was an increase in the average hourly earnings in the jobs report today, because we need that little extra to help cover the rising cost of food. yesterday we told you how much more your breakfast costs, things like coffee, o.j., bacon, et cetera. but it does not stop there. year to date, corn is up 15%, soy beans, 7%.

sugar, 11%. cattle, 6%. think about what all those ingredients go into, right? pretty much 80% of your grocery bill. >> look at those charts. what is that, corn, sugar, soy beans. >> cattle. >> lean cattle. >> yeah. >> i like fat cattle. >> that's where all the flavor comes in, the fat. what is next when it comes to food inflation and more importantly, how will it affect how much you will be paying up? joining us is strategist nick collis. give us your predictions, what else is going up? >> it certainly is the case that food inflation is v here to stay. over the past three years, the food basket of the cpi is up 7.2%. corn inflation up 5.2%. if you lay around factors like globalization of the food chain as well as the drought we have had in california, those factors alone portend further inflation to come. >> when you say it's here to stay, we have just be talking about the weather, the drought,

the drought in the west coast, the drought in brazil. these are temporary things. when you say here to stay, for how long? >> at least the next two to three years because even though you might get rain in california, a lot of the impact for things like beef actually occurred last year with the drought that began last year. it takes time for pasture land to come back. it isn't just the case that a little rain makes it go away. it doesn't. >> we have to leave it there. by the way, best notes on the street every morning. >> very, very, very good. thank you. now that we know the news, how do you play it? you are probably asking what am i supposed to do? john bumgartner, you like white wave, i have never heard of them. i looked them up. i know the brand silk, the fake milk or whatever it is. why do you like white wave? >> well, consistent with other food companies, we will see inflation for white wave in 2014. but the skew towards health and wellness categories, bifurcated

higher income consumer, they can pass along the costs with limited impact on volumes. >> what about stocks viewers might have in their portfolio already they might want to dump if food inflation is here to stay? >> i think it pays to look at categories and geographies where we are seeing faster income growth, such as asia. infant nutrition. health and wellness. things consumers want to pay up for in times of higher commodity input costs. >> do you expect commodity input costs, fancy way of saying the price of the stuff we buy is going to go up so we got to pass it along or eat the gross margin, do you expect that to continue? some of the gains that mandy pointed out, these are big gains in short periods of time. >> it depends. i think in regions of north america, western europe where consumers are weaker, we are seeing companies hold on to higher prices to try to drive volumes at retail. we are seeing more of a margin impact for food companies. in developing markets, where we

are seeing 3% to 5% inflation, it's easier to pass on it to the consumer. we think developing markets, asia, latin america, you could see stronger performance from those companies. >> your two p johnson nutrition and white wave food which is a small cap. thank you very much. >> thank you. still ahead, where are america's skilled workers? in middle school, apparently. how 12 year olds could be saving jobs in america. we will explain that for you. first, here's a friday mystery chart for you. this is an ugly chart unless you are short the stock. that's the company. down 16% this week. it was founded 1986. the answer and much, much more coming up.

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so much for the gains we were seeing earlier in the day. the dow at one point was up by 84 points. now it is down by 17. a pretty good week overall. the s&p did earlier today hit another record high. no one really pays much attention anymore because it's almost every day that that happens. news is man bites dog.

there's your mystery chart. there are some good guesses. somebody guessed gap. close. it's a retailer. it's actually staples. worst performer in the s&p 500 this week. earnings, no other way to say it, they were terrible. they announced $500 million cost-cutting program, 225 store closings by the end of the year. staples up a little today but just an awful week for shareholders and employees. >> i will go buy some more stuff. we have been telling you how the u.s. added 175,000 jobs this past month. all good but just where exactly are those jobs? one place is a north carolina aviation company that is looking so hard for skilled workers that they will go into middle schools to mine them. mary thompson is there with more. they are scouting them among 12 year olds? >> reporter: even a younger audience, too. more on that later.

timco's facilities here are open 24/7 to provide faa required maintenance on commercial military as well as cargo aircraft. the first shift here is winding down and behind me, you can see these technicians are going over an faa checklist which is basically a road map that they need to follow to make sure all of these planes are serviced correctly. they do this before they hand the work over to the next shift. timco is having a problem making sure that all of its shifts are staffed. demand for its service is rising as the global fleet of aircraft expands. just as 30% to 40% of its work force is getting set to retire. to ensure a steady stream of workers in the future, it starts pitching a career in aviation when kids are as young as fourth or fifth grade. >> being around aircraft is fun so we do like to go to elementary schools to start to get people interested in understanding the aviation industry and the potential they have right here in their hometown to have a career.

>> reporter: vice president of industry and government relations kip blakeley says the real recruiting starts in middle school. they are working to get kids interested in a four year aviation program at a local high school. junior bruno cacassi is a student there along with a summer internship at timco. the 16-year-old said a timco engineer helped cement his intention to pursue a career in aviation. >> it's more interesting now that i've seen in depth and being in the cockpits of airplanes and being in the offices with the engineers, it's just helped me to make the choice. >> reporter: bruno's choice includes attending a four year college so his career at timco may be a couple years off but some of his classmates who took the mechanical rather than the engineering track at that high school, when they graduate, they will be certified by the faa and that means they will be able to work on these planes. back to you. >> mary thompson, thank you very much for that.

you know what? this is actually a very, very good idea. we have to take away the stigma of the idea that you are not going to go to college, instead you will go into a great trade, go straight out with no debt, start earning and you will be driving a mercedes benz when you are a plumber. >> you couldn't be more right. we lack skilled tradespeople. >> absolutely. >> i'm going to say something that will probably sound offensive to some people. if you graduate -- i graduated with a liberal arts degree and with -- >> so did i. and no skills. >> i didn't come out with any skills. i went to law school, and that helped a little bit. but the reality is if you have a liberal arts degree and a bad grade point average from sort of a middle of the road school -- >> and a massive debt. >> it's tough. it's hard out there. >> then you have to go in and start learning on the job anyway, whereas this, what they are doing i think is a fantastic idea. it has to be expanded and accepted much more. >> absolutely. herb, are you out there, buddy? i hope so. listen up.

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how many times have you said today thank god it's friday? t.g.i. time. let's take a look at what's happening in terms of stock news and views that we call street talk. first of all, raytheon, a defense stock, it is moving not massively high, just a little higher, but it did get a target increase at bernstein. >> second day in a row with a target increase on raytheon. that's why we bring it up. the target increased to $117 from $106. the stock is at $101 and change. the rating remains outperform. also initiated overweight at morgan stanley, their target $115. they got a big new missile contract. lot of positive commentary on raytheon. >> let's move along. we have clean harbors. herb has been on the show a couple of times talking about this stock. it's getting an upgrade to a strong buy from market perform at raymond james despite the flag waving herb did. >> stock's helping, too, up to

$52.26. their price target, $60. clean harbor is a provider of environmental service like waste disposal. it comes after a round of downgrades and maybe herb greenberg bashing in there. >> we should say in all due respect to our wonderful friend herb that he gets things way more right than wrong. right? >> but if he's not here we can say what we want. >> polycom enjoying upswing after an upgrade to buy from mutual at citigroup. >> target increased to $16 from $12.50. a leader in video conferencing. about to launch a new cloud-based video conferencing service. nice upgrade there. stock up 2.5%. >> we have houghton-mifflin. the stock got a downgrade to hold. >> the target remains $20 a share. really, no upside. net sales did rise but they posted a loss of $111 million. basically wall street saying no need to buy the book maker. all right.

shares of gap seeing a big reversal today after the retailer posted disappointing sales for february. is it time to mind the gap? and give this stock a chance? start talking numbers, j.c. o'hara and on the fundamentals, simon siegel. j.c., this has been a pretty decent performer. big reversal down. does it change your view technically? >> there's a lot going on with this chart. just taking a quick look, it's pretty sloppy. i don't know if that's the best technical term used to describe it but it's a term i will use here. no pun intended when i say this chart is full of gaps. to me, from a technical point of view, gaps are signs of indecision. mispricing. that is concerning, especially over the short term, because it's hard to get a good idea of short term trend. however, we take a step back and look at the longer term trend, the stock was doing very well when it was above its rising 150 day moving average. just recently you saw the 150 day slowly turn over. now you have a stock sitting

right on a declining 150 day moving average. red flags are appearing. one saving grace, we are above critical support and i will label that support at 36.50. price is not breaking down yet. there are a bunch of minor levels on the upside, 42.5, 42 and 46 that will act as resistance. there's really no good risk/reward trade of being in this name. >> good point. what about the results? what do they tell you fundamentally speaking? >> it's a really good point to frame it in the short term versus the long term. short term we probably agree. you look at what the gap's doing operationally, they are doing everything you want to see, bringing costs down and buying back stock. to your point, you look yesterday and see a disappointmenting february, whether they are blaming it on the weather, whether we are talking about different misses on the product, you are talking about challenging top line and sales results as you start to compare against your strong performance last year. the strength from last year becomes your worst enemy. in the short term, we think you

get a better entry point, longer term we like what they're doing operationally. >> all right, we appreciate it. thank you both very much. kind of take a break, wait, see if the stock pulls back, then accumulate. guys, thank you very much. everybody, be sure to check out the online edition of talking numbers, part of or partnership with yahoo! finance. coming up next, the battle for the world's biggest airline. we will have an exclusive with the ceo of iag. what is that? the parent company of british airways. >> cool. we are sick and tired of the treacherous roads here. that's my drive to work today. if you don't live in new jersey, this is one of the segments where you can look and go you idiot, why do you live in new jersey and point and laugh at the television. we will then make the argument for raising the gas tax. yes, raising taxes. tdd#: 1-888-648-6021 there are trading opportunities tdd#: 1-888-648-6021 just waiting to be found. tdd#: 1-888-648-6021 at schwab, we're here to help tdd#: 1-888-648-6021 bring what inspires you tdd#: 1-888-648-6021 out there... in here. tdd#: 1-888-648-6021 out there, tdd#: 1-888-648-6021 there are stocks on the move. tdd#: 1-888-648-6021 in here, streetsmart edge has tdd#: 1-888-648-6021 chart pattern recognition

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make more money investing in someone overseas? speaking of people from overseas, simon hobbs is here with a special guest who used to pilot -- you didn't pilot 747s? >> no, my guest did. 747s for ireland. guys, surging traffic across the atlantic's helped push the stock of british airways and iag up a whopping, get this, 140% since january of last year. a cnbc exclusive interview, willie walsh joins us from washington, d.c. where he was presented with an award. welcome to the program. congratulations. >> thank you very much. >> we should be clear, this has been a hard slog for you guys. you are actually integrating four airlines, thousands of job losses, major conflict at time with the labor unions. you ruffled an awful lot of feathers. are you there yet? >> not quite but we have made excellent progress. i think we are well on the way to delivering the sort of results that we believe are important and necessary in the industry. >> how do you feel about the fact that you are, of course,

almost alone with your u.s. counterparts in not being able to file for chapter 11 bankruptcy which they all have done. you've had to do it in a different way. is it more painful? >> i think it's more difficult, more challenging, but also more rewarding when you come through the sort of restructuring we have had to face up to and clearly, the benefits of that are showing in the financial results and in the stock prices you mentioned. significant increase in the stock price reflecting the turnaround in performance. >> everybody knows when it comes to trans-atlantic it's first in business that is clearly the most lucrative. things are really hotting up. klmf france announced a $1 billion investment. the middle eastern airlines are there. branson is getting in bed with delta. how do you stack up? how will you move forward and is the american deal, the partnership there, still feeding you traffic after the merger with u.s. airways? >> without question, our relationship with american is very positive. i'm delighted that that merger has taken place. we are the leader on the north atlantic business between the uk and u.s. is always strong.

we have launched new routes. we started flying from heathrow to austin in texas earlier this week. that's a reflection of the belief and commitment that we have to the market here. i think it's a good time for all airlines but it has been particularly good for british airways. >> what about the airline reward schemes? delta gave further details on how it's breaking away from the big three and it will reward people for the money they have spent, not the distance that they fly. you think airline reward schemes are on a slow path to destruction now for most people? >> not on a path to destruction but they are changing. when you look at delta, definitely the most innovative carrier in north america. richard anderson i would say is probably the best airline leader we have around. when they do things, the industry watches and the industry will take note of what delta is doing. it's going to change. >> you think everybody else will follow suit? >> i think things will change. whether they match what delta has done, i'm not so sure at this stage. we do many of the things that delta are announcing they are doing. i think you have to have a system that is fair to your

customers, rewards them but equally, we are in business to make money for our shareholders. it's got to be an efficient scheme for everybody. >> what about united airlines here? it started it would appear aggressively moving people back to check-in, to check their bags and pay for them if it deems them to be too big. is that something that you would do? >> no, i think that's an unusual move by united. i know it's been interpreted as an effort to raise more ancillary feeds. i understand the problem, a lot of people carrying baggage on board the aircraft, it is too big, we are limited in space, but that's a particularly aggressive move and i don't believe it will be matched by other carriers. >> willie, we will let you go. i know you have to catch a flight back to london. if you run the airline you're on, do you get more sleep or less? >> i have to say, on a british airways aircraft i sleep really well. >> nice to see you again, willie walsh. thank you very much for joining us. >> do they know who he is? is it like "undercover boss"?

>> the unions know very well who willie is. >> can i, great interview, can i point out that on this segment, i had this sudden moment where i felt like i was actually anchoring on british television. one of these things just doesn't belong here. >> i'm not british. what are you talking about? >> it's the same thing. >> they think i'm british. >> he is actually irish. don't worry about it. >> it's still the queen's, isn't it? australian. not irish. sullivan here. i can't win with you, hobbs. why it's time to raise america's gas tax. [ bagpipes play ] make it happen with fidelity active trader pro.

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all right. let's take a little ride on to the palisades parkway, better known as the oregon trail. >> iphone is on a stand. i'm not holding it. two hands on the wheel. safety first. that's the road near cnbc. they actually patched a lot of the potholes last night. you can see the black spots. those are patch holes. look how bad it is even after -- >> i'm trying to hold the camera mount steady. >> there's nobody else in the car. i'm literally talking to the

camera. >> i have no idea what you just said. >> i have a hand on the mount now because it's hard to see. i'm in a jeep wrangler, by the way, it's about three feet up, jacked up with these big tires, and i'm still shaking around. that's how bad the roads are. this is not some vanity video. there's a point here. the gasoline tax is supposed to pay for stuff like that, right, repairing potholes, making sure bridges are safe. but here's the problem. the gas tax, inadequate. phil lebeau knows a lot about the gas tax. where does it currently stand? >> reporter: it's 18 cents, roughly speaking, per gallon of gas, 24 cents if you are going for diesel. the problem is, we are pumping less gas these days and as a result, what we are seeing is a shortfall in terms of the national highway transportation fund. where all of that money goes to pay for projects both on federal highways and to match with states. look, it's only going to get worse. this is the projected shortfall and we are talking about billions of dollars. they are already pumping money

from the general fund into the highway transportation fund, and as a result, people are saying something has to change because when you look at what people are doing, when they are at the gas station, they are filling up more fuel-efficient vehicles. in fact, in the month of february, the average new vehicle miles per gallon for a new vehicle, 25.2. that is a record high, according to the university of michigan. and then you have more people who are driving both hybrids and electric vehicles. i know electric vehicles are just a drop in the bucket right now in terms of all the vehicles on the road. but some states are saying you know what, why do we put in a mileage use tax. in other words, how many miles are you going to drive a year in your particular vehicle, whether a tesla, whether a prius or a leaf, whatever it is, every year when you get your license plate, maybe you will pay some percentage of the miles driven to the state. that's controversial but some states are looking at that. >> phil, thank you. let's continue this and bring in former transportation secretary ray la hood.

secretary, you know the american electorate better than i do. i cheekily described them as everybody wants everything and nobody wants to pay. we all want good roads but if you mention raising the gas tax, we're all doomed. how do we fix this? >> brian, thank you for keeping both hands on the wheel while you were doing that little piece. dodging all of those potholes. america is one big pothole right now. i don't have to tell you that, or any american, because we haven't continued to fix up our roads and bridges. the highway trust fund will be broke by september if congress doesn't step up and do something about it. we need a bold vision. we need people with courage here in washington. we are proposing let's raise the gas tax, it hasn't been raised since 1993, let's raise it, maybe ten cents a gallon, and index it and then we will have the money to do what america's always done, take care of our roads and bridges. it puts people to work when we

do that and it also allows for the kind of infrastructure that's made america a great country that it is. >> secretary, to what degree do you push to raise the gas tax during your tenure and why weren't you successful? >> well, during the time that t d.o.t. secretary, the president put out a big, bold plan, $550 billion transportation plan over five years, paid for, and we talked about the way to pi fay fixing up potholes and roads and bridges. the idea we didn't have a big, bold plan is not accurate. we did, $550 billion over five years and paid for. i'm proud of that. >> you know, we all want sort of clean energy. we know the president has pushed for that, secretary lahood. electric cars are great. the problem is you're not paying a gas tax. if electric cars take off, what is that going to do to an already distressed

transportation fund? >> it's going to clean up the air and people do like to buy fuel efficient cars whether they're hybrids or battery powered or a combination of that. again, brian, that's the reason we say let's raise the gas tax. the highway trust fund is what built the interstate system, the golden gate bridge, the hoover dam. that is what has made america a great place, our infrastructure. you have economic development and jobs. and so we need to raise the pot of money that helped build america, the highway trust fund. >> use the pot of money to plug those potholes. secretary lahood, thank you very much for joining us. >> thank you. >> it's embarrassing. it's embarrassing. >> there are better roads in malaysia. i used to drive on better roads in southeast asia than i drive on here. >> it's embarrassing to come to an american airport. we're becoming a joke.

>> when we ask a question should we raise the federal gas tax, there are pros and cons. carl davis says absolutely yes, but chris edwards from the cato institute says heck no. so, david -- sorry, chris, i want to start with you. you say raising the gas tax is not the answer. what is then? >> i think decentralization to state governments and the private sector is the answer to infrastructure. state governments can raise their gas taxes anytime they want to fund their own highways. there's nothing stopping them. we also need to look at privatization. so in northern virginia where i live, they just widened the capital beltway, a $2 billion project. it's been a huge success. the money was mainly private money. a private company raised the money, widened the interstate in northern virginia, and the project came in on time and under budget. so we ought to be looking at more privatization like that. the united states is behind most other countries. britain and canada, for example, have more private highways,

private airports, and private air-traffic control. that's where we ought -- that's the direction we ought to be going, not relying on the federal government and washington where it's often pork barrel politics. >> but here is the problem, chris, and i hear what you're saying, my parents live at the end of the dulles greenway. i get it's a nice road. here is the problem, state politicians are just as chicken if not more so. you say let the states fix it, well, the state politicians want to get re-elected, too. if you mention raise the gas tax, it's political suicide. eventually we'll all be driving into potholes and getting back on horses. >> no, see, i would differ with you. look at virginia has done all kinds of innovative private financing. dulles green way was privately financed and built in the 1990s. last year virginia completed and privately financed a $150 million bridge over the elizabeth river. that's very innovative. and so there's a lot of solutions here we can go to

whe without relying on washington. >> what about you, carl? make the case. >> handing that over to the states is definitely not the solution. the states aren't asking the federal government to back off transportation finance. they want more money from the federal government. the states -- we don't have 50 separate state transportation systems in this country. we have one transportation system that's very much interlinked. if is looking at closing down bridges or minnesota's bridges are actually falling down, that affects the whole country. the federal government needs to be involved and they always have and it's a good role for them to play. >> listen, carl, i get your point, too. the other thing we haven't pointed out is actually, phil, i don't want to say phil was wrong and our giant graphic was wrong. the gas tax isn't 18.4 cents, it is, but it's actually only 11 cents inflation adjusted.

it's nothing. >> we've gone 20 years with a gas tax rate that was set in the first year of the clinton administration. you talk about running government more efficiently, running it more like a business. just imagine if you opened up a restaurant 20 years ago and you didn't raise your prices for 20 straight years. i don't care how good a business person you are, you're going to be struggling to make ends meet to pay your rent and your electric and your employees' salaries because all those things have gone up in cost. yet we have a federal gas tax of 18 cents a gallon. >> guys, we have to go up. do you know what else has gone up? tolls. i pay 7 bucks each way on a road that when i moved here was like $2. $1.50. it used to be $4 to go to the holland tunnel, $12. >> it adds up if you commute every day. >> where does that money go? >> clearly not into fixing the roads at this stage. chris, thank you very much. >> all stressed out from my ride. >> thank you. >> and our viewers don't care.

>> why don't they care? >> my old car -- i stole the jeep from my wife -- broke down last night again because i hit a pothole and the headlights went out. >> that's thousands of dollars you have had to sink into your car to fix the damage. >> there was a study done, i think it was carnegie mellon, a couple years ago, and it was basically that people complain about the gas tax but you spend more money fixing your car than you do if you had better roads and higher -- >> i don't want to sound like a foreigner telling the united states this and that, but at the same time what you pay for gas is a whole lot less than what the most of the world pays. >> but you only have to go to 20 miles to the end of the rainbow and your pot of gold, lassie. up next, the words that are now banned from this show.

we know we're not the center of your life, but we'll do our best to help you connect to what is.

♪ [ girl ] my mom, she makes underwater fans

that are powered by the moon. ♪ she can print amazing things, right from her computer. [ whirring ] [ train whistle blows ] she makes trains that are friends with trees. ♪ my mom works at ge. ♪ sometimes you got to have fun so a couple days ago i wrote my most overused words of the year, viral, hack, snow. you had a good one yesterday. >> apocalypse. everything is now like a guacpocalypse. and the other is knsmowmageddon. people wrote in and said what they thought were the best words

as well. >> viral by far. our viewers thought viral -- everything is viral. you tweeted it out. it's popular. also what's the other one? cure rate. you don't curate a play list. you make one for your special someone. >> thanks for joining the conversation on "street signs." tomorrow is digital detox day. bye. . and welcome to "the closing bell" on a friday. so much activity this week. we'll see how we close things out here. i'm kelly evans at the new york stock exchange. >> happy international women's day. >> that was news to me as well. >> i'm guessing international men's day is april 1st. just a guess. i'm bill griffeth, a mixed end of the week after a mixed jobs report. any positive finish for the s&p 500 would be a new all-time closing high. we're watching those markets very carefully. and these stories