legs up, legs up, legs up ! red hot deal days e back. let nothing stop you. good job ! it's red hot deal days. get the nokia lumia 822 in red for free and discover all the things to do on the go with city lens. or the droid razr m by motorola in pk for $49.99. everything droid does in an edge-to-edge display. hurry in, because the sale ends february 20th. powerful devices. powerful network. verizon. neil: well you better be watching the president's state of the union speech tomorrow, something tells me, me just ordered you to. >> welcome i am neil cavuto, first my thanks to my colleagues and friends, charles payne and lizzy mcdonald for tir hard

work when i was time, time for the notion of king obama to sink in. i know it sounds silly, but what would you call it? president obama has been buying barking off a lot o orders. only last month a federal appeals court said, president exceeded his constitutional powers when he named several people to national lak labor bod while the was on break, the white house insists only thing that president is trying to break is a logjam with the republican, we have these things called branches of government for a reason, so no branch of power is seize government on its open for any reason.

tomorrow night, what ran through with or without congress, message to president, just because you can't all ways get what you want is no rean to do whatever the heck you want, whether it is an executive order to slow climate change or push to use drones on american soil. whether americans like it or not, this is not a case of a president misreading an elect, this is a more dangerous case of a presiden misreading something? reality, all rise on the judge, time to stand down. >> how can i follow your else else when the 'is doing is chilling. he can kill the americans after years of litigation. neil: part and parcel of a large

executive act story that goes unreported. >> yes, here is what an executive order is, a piece of paper directing someone who works for him in the executive branch, there are 3 million civilians, and 2.5 million military, he can tell those people how to do their jobs, period, he can't tell the epa how to do its job, he can't tell congress how to do their job, cannot tell the court how do their job, he cannot give an executive order for corporations, andndividuals. here is the bad news, congress, not this congress, but prior congresses have given presidents a lot of discretion to how to ep peperrin ter pretty and exercise and enforce the powers they

have. always in favor of the government, against the individual, always in favor of big governments or groups he is aligned with. neil: but he is doing it on his own. is the thinking that i'll just keep doing it, knowing i will get slapped down on some but not all. >> he knows in every case where he getting slapped down, he waited until therefore a recess, he signed appointment they have been on for a year and a half, what they did is invalidate it, supreme court said you cannot just create this, the senate decides when it is in recess, he figures for eve one of those heoses there will be 10 or 20 he will not lose. by the time the case gets to court, he may not be president any longer. neil: is he over reading the election? he won, but he did not win the

right on become a king. >> you are right. instead he is dividing us. by group, by cla, by wealth. neil: and saying my way or the highway, if you don't go with me. >> the republicans if they stick to their values. neil: they are not. >> you are right, they control the house but they cave. they have enough to cause a filibuster. neil: they are still running around with tails between their legs. >> he is going to take advantage of that, for all of his convictions, he has courage of his convictions and he will stick to it because he knows his adversaries on capitol hill will fold, do we let him get away with it? we need to expose it so american public understands it. neil: i is one thing for democrats to be come plac come t

for period to act like a king but media, they are barely reporting on it, sometimes when it does come up on another network it is deemed much ado about nothing. >> there is no question, look at the gun control special orders, 23 of them, have they gotten coverage in the press, absolutely, a lot. but coverage is about how good they are, what a good thing he is doing, no body but no body on those networks has gone from the standpoint he is usurping power. neil: what if george bush were pulling these stunts it would be unmerciful. >> we know that gun control is one of the favorite issue agendas of the national mia. here is another one, aboring, what do you -- aboring, what do

you think wou happen this george bush announced heed had 23 executive orders to limit planned parenthood. neil: forget about it you are right, how did this get barely passing attention, it is pro-attention, president is doing the right thing, and republicans are fighting him on these stupid issues they not fight him oso we media are for for the president usurping his constitutional authority. >> look at recess appointment. the day that happened. i was stunned, stunned that the administration would announce that senate was on recess, when it was in session, these go to show, huts pas hutzpah of these, they am challenge everything look at cap and trade, it condition down in flames, and -- it went down in blames, and they said they are going anyway, they are above the cone for ma cfirms

in the senate. this is dangerous stuff 92 this dates back to the benghazi mess, and republicans reining themselves in, media is not with us. we're dropping it. whether it comes to reigning in the president on the executive actions, media does not make a big dial of it, but -- the media is almost forcing the republicans hand to do nothing , what should republicans do in response? >> if republicans don't do something about it, it -- it -- they fall apart. b the republicans have to have the faith in their conviction to come forward. let the media come after them, let the left attack them. but at least the public will know where the republicans stand, they have no idea where the republica stand, the republicans are in favor of tacking the poor as far as

public knows, it is all turned upside down, a masterful politician, and media are aiding and abetting him every step of the way. neil: thank you so much, brent bozell. speaking of that state of union our coverage begins tomorrow 8 p.m., not only the president's speech but republican remark, rubio, and latest from corporate big wigs, one place. you can only get it on fox business in one place, three hours straight. the most complete comprehensive coverage, so complete, that truth be told brett baier watches us, really. anyway, state of union, as states are in panic, former presidential candidate, on something that president is pushing for that is leaving governors in the state of total confusion. >> then nancy pelosi, john

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neil: ahead of the state of the union, rick perry, texas governor taking his low-tax sales pitch to businesses in california. low taxes are a winning message, governor, good to have you. thank you neil. neil: you had success with that running things in utah. now that it has widens in california with top rates that dwarf federal income rates in plane countries, what -- in many countries, what will happen to california do you think? >> you will have some who can

afford to stay in california, and willing to pay the premium involved. if you look at corporate tax side, probably you know 8. 89% if you are in financial services it is 12%, and individual rate is 12% on top of that. incomes, rick -- in comes rick perry, a good frid of mine, he understands how to move business, and offers a state that has nothing in way of individual income tax, nothing by way of corporate tax. and it is a pretty compelling message for financial services businesses, for the innovators, in silicone valley, and manners outside of los angeles in the bay area, used to tell governor schwarzenegger, it's a pleasure to pick your pocket from time to time, there is so much in the way of hanging fruit, a state with competitive tax regime, and business friendly environment, and regulatory environment on top of

tax structure is something that also is bedevils for businesses, if you can streamline, that they have been in texas, have you a competitive environment, and california will have to beware of those incursions. neil: it does not appear that governor brown in california is too worried, the much closer threat to him is nevada, you could hop across the border. if you have a choice paying 13%, versus zero in nevada, you would go to nevada. what do you think is going on with republicans, they look like their party about tax cuts, and little else, that, despite the press it gets governor perry doing something here that catches some people's attention, it -- republicans don't seem to be offering much new, what do you say? >> here is what people in california are going to say about you know an overture from

texas, i know i have been through this many times, trying to win over investments from outside, they will say how are your schools, as republicans we need to be able to talk about education reform, and what we're doing in terms of supporting teachers and changing classroom in ways that speak to the promoting learning technology. and providing more in way of educational choice. we need to talk about quality of life. in what it means too have an environment with breathable air and lands that people can share, they come from teddy roosevelt view of the world. >> that is your view, you are like a teddy roosevelt-type republican is that fair to say? >> i say it works, republican party has a long history of accomplishments and ways that republican leaders have changed this country. neil: a core conservative group, when run for president, and your powerful roles in republican party over the years, but, i

caught a piece today, you might have, in "new york times," a young montana voters, who are very much to the left liberal a lot of them a couple quoted their fondness for you, but. >> heaven forbid. neil: it was not enough you were not enough, and republicans by repudiating you, i'm over analyzing here, were not the necessary of that include all, bring in all. that will hurt republicans, what do you think of that? >> well, i think there is a fundamental shift occurring. in america. and you lose a younger demographic nile, 60-40 is a wake-up call, young kids, i am raising a couple of them, i talk every day about these issues, they want balance budgets, they want the economy that work, they wantob opportunities, and prosperous growthing or yenned economies, -- oriented

economies, but they are also a little bit more cutting edge as it relates to searas to social , they care about the environment, they get married later in life, they live in a heterogeneous type of environment with kids all over the world, we grew up in a different melloul. neil: i don't see your party moving in that direct, some argue maybe you should. >> we're the party of life, liberty and pursuit of happy net, the party of find, a party that can speak about those opportunities, to all people in the united states this is a party that believes in giving a sense of ownership an opportunity over single citizen in this country, but we're also neil, the party of problem solving, we have gotten away from problem solving, we forgot how to do a dial, a lot of governors are pretty good from it, we should learn more from

models of the republican governor that are doing good things but we lost the art of problem solving. that is what republicanism i think was founded on. pragmatic solutions to the issues of the day that work in favor of all americans, governors do it well, live doing that thing as governor of state of utah. and it works, on the economic side it should work on education policy, it should work in terms of quality of life, which people, have in mind when they make the business and investment decisions. pleasure, thank you, sir. >> thank you, neil. neil: governor john hun huntsma. >> warning the young generation about the cost of that government. with fidelity's new options platform, we've completely integrated every step of the process, making it easier to try filters and strategies...

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neil: the young are getting restless, to hear my next guest, just clueless. no surprise that young like washington doing more is a surprise how much more. we'll get to that gentlemen in a moment but first, to chris and julie and ron meyer. ron, your generation seems to defy you. what do you make of that? >> absolutely, it is really because conservatives do not reach out to college campus, but the problem is we have had 4 years of obama, what do young people have. last month unemployment went up. now 6 and 10 in millennials have

jobs. neil: they seem to like the government that by and large is espoused by democrats and this president. >> because of the education system, and because of president obama, and conservatives and republicans are not trying to talk to young people, we have a few people like he and a couple other folks in movement but as a whole we're not, we have to talk about their pocketbooks, they want jobs, they want employment. i have friends, who are desperate, we have to reach out to them, if we're upset that young people are not following us, we should ask wha are we doing wrong, what can we do to reach out and cvey our message better, everyone knows that republican party has a communication message 92 i don't 92. neil: julie, it is a case of young people tendo be more liberal anyway. >> churchill said, if you're

young and liberal. you are young at heart, i think ron, had a good point, republicans are not focused on the right stuff, they are focused on personal social issue. neil: about ratio 60-40 that is just -- >> not a surprise, what young people are hearing, single women overwhelmingly voted for obama, focused on men, this is stuff we have to talk about. you know we don't have to talk about it but republicans do, but that is it. neil: you say that republicans are not reaching out to young people or speaking their language it is hurting them. >> i agree, republicans need to do much more in reaching out to young voters. neil: like how? >> they need to reach out is about how they will solve problems, one big problem that republicans run into, we started to talk about cutting side of

government as this great end in and was itself. and, you know shrinking national debt, and deficit is hugely important. but for many young voters, they have huge student loan debt, they can't find a job, they are asking republicans what is your answer to make my life better off. neil: ron's answer is pick yourself up by your boots straps and figure it out. >> no it is to empower the private sector, but government, which is heavi unionized does not employee young people, the government balloon, youth unemployment has skyrocketed. we need to empower the private sector by cutting taxes and cutting government spending, government spending that money comes from some where, it com from a job creator who will spend that money, every time someone says any os government g stimulates the economy, where do they get that money from. >> i will say, if i'm an 18-year-old kid, and i want to

go to college, and i look at a party that wants to cut pehl grants, these are not people on my side, they have a communication problem and also a policy problem, it seems to be you are taking away money from student grants. neil: i will say, julie hits on a point, the perception is, that republicans, built a reputation as party of no. and that it comes at a time a lot of young people are embracing a conststructive role for bigger government, you can agree or disagree, but that is evidence in a lot of polls, young people are embracing a kinder gentler friendlier big government, and how did you disavow them of that notion. that it could be damaging? >> i don't think they are necessarily embracing government, they are waiting for someone told show them, what is the other option, challenge is talk about nongovernmental

solutions, how can communities and individuals and businesses comeogether to solve problem, to the issue of college tuition, why not talk more about the drivers that make college stuic go up and -- tuition go up and up, looking at things in our economy that are more and more expensive, education and health care. things that government is the primary purchaser of, why don't republicans make more of these argument about what is really causing these problem, and how there are solutions that are not the goverent that will fix them. neil: ron, to jile's point of view. if you want a loan and you want to get to college, you don't have time for new an, the nuanc. >> not about ne nuance it is abt whether or not you want $ 30,000 in debt, or a future after you graduate college, you want to be able to have a job, and afford being at that job, and not going homeless.

i thi what republicans need to say, look back to ronald reagan, i know people call this nostalgic, youth unemployment dropped 43%. it went from 18% to 10% over his term. that is sort of example we need to show, if we' people employed go back to reagan model cutting domestic spending and cuts taxes. neil: all right. i'll have you all back in later, for the time, you would expect nancnancy on fancy tax hikes ane does. not enough.

neil: john mccain has opened -- is open to more revenues but maybe not ralph nader-type revenues. you say go after corporations but much bigger time, what do you mean? >> well, first of all, the amount of aircraf -- avoid answs has been perfected by a lot of the big corporations. a number of them got tax chuck

subsidies back. general electric, verizon, boeing, pg&e you maim it. >> they rigged it in a way they ge get massive checks, in 3 years. general electric made billions of dollar in the u.s. >> i agree there are many examples, everyone should pay their taxes. what would you establish as a take the loophole out, and set a new tax rate, what would it be? >> go back to 1960s, very prosperous, relativel speaking, high employment. all of it comes arod 30%. give or take. that is a good mean. and for.

neil: at the same time we had a 92% -- individual rate, or would you? >>, not. and very few people handful of them paid that. >> you argue, if we just do that, and you are right, you hear establish top tax rate, pegged pretty much for top individual rate they pay that like individuals pay, very few are. how do you correct that? what do you do anything forward to correct that? this could raise a lot of money? >> you get rid of what are called tax shelters, loopholes away corporations shift tens of billions of u.s. profits to tax havens, through royalties paid to patents held by their own subsidiary, and the zero-tax attack haven, and you -- tax half in, you get rid of what larry summers said, a lot of the exclusions that have deferred

taxes over values assets, derivative shenanigans, regardless of republican or democrats there isn't anybody -- >> we have many a fine argument. but i do think that if we close a lot of this nonsense, and just i believe in labels that reflect what they say, and whatever the tax rate is, you pay it but i think hope springs eternal we'll get to, that i do not see the appetite out of this president or republican congress to gets there? >> things are beginning to change. neil: among whom? >> david camp, republican chairman of house and ways and means committee is doing something to come around with these massive derivatives. il: he argues, democrats have to be very zealous to go after

spending. is ralph nader as zealous to go after spending? as well as closing loopholes ? >> big time, corporate welfare spending, subsidies handouts give away, bloated military budget, documents by retired admirals, and generals. those are huge areas,. neil: i know that, but that is not -- spending out right, would you cut anything? i guess, if you would to rein that in, you are. >> yeah, of course. and it is very important to know, that a lots of health care expenditures are reflection of fraud and over charges. the head of the general accounting office in 1992 said 10% of all health care extend durings by americans go down the drain by computerized billing, fraud and abuse that is billions, now, if the sequester

goes 3, it will be blamed on the republicans they will have to unemployed all kinds of prosecutors, and law enforcement. including those against corporate crime. not a good idea. >> ralph, how do you think that president will do in his second term? >> well hard to predict, depends on who he appoints to cabinet, i can't see how he will do worse than first, he has the republican on the defensive, i think that mccain has his finger to the wind, the tax issue, i think they will have to deal with the military budget, all these weapon systems, designed for the soviet union era are still in the pipeline. neil: republicans, are willing to address that? and expect something out of democrats but i do not see much budging out of nancy pelosi. >> she will follow and reid will follow obama's lead. neil: obama is not leading. >> not as much.

but i think you will see major effort on the federal men mihm minimum wage, 30 million workers that make less than 1968 workers adjusted for inflation, that is going backwards into the future, even you neil would not think that is fairplay. neil: i like h you -- >> even you. you despicable capitalist neil, live it ralph, we'll have you back. ralph nader. >> good to see your cold is over with, neil. >> well, that and were more. all right, we're about to get smacked with more cyberattack, this is washington warning about it former cer czar on whether we can stop a cyber war.

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neil: china on a cyber rampage, anonymous hikers on the attack, and reports that president will issue a order wednesday calling for certain infrastructure companies to beef up cyber security, following attack on media outlets and department of energy, federal reserve and bush family, former white house cyber czar, howard smith says this threat is a very dangerous, and costly one. i think it hit home for me, when former president. multiple presidents, family were en snared in this, i think, it could happen to any of us, what is going on? >> a number of things, you look at incident you refer to, we used a shared infrastructure e-mail, and watching television, books, flights on line. we all share, that anybody that gets access to, that thrunet

net,orldwide, gets access to any ofous dollar. we look at bigger picture that sport oshortof theft of intellel property, we do a lot of innovation that takes place on the internet, our companies or military do this as a consequence with the vulnerabilities we're easy targets, people will take advantage of it quickly. neil: i worry bnever in our history have we well a case where our assets are essentially on the web. you know, our access to them is by the internet. we assume that the ar a count in on that on-line account, is easy to disappear, i don't top sound overly alarmist but if they can hack former president's e-mails accounts it is not a leap to start going into average folks bank acouncils and make them

disappear. >> correct, that is one end of the spectrum. crimes we see for fraud, and identity theft, that took place in physical world with dumpster diving, now it is done on-line. and bottom line, we really don't understand as the end users how vulnerable we are, a have built a system with great capabilities, but it is fraught with vulnerability. neil: how can we be less vulnerable. at least you can stir us to things we could do to curtail it or cut down? >> i think one biggest thing is make sure that the software we're using whether a mack operating -- mac operating system or windows, our television now have operating systems built, in we're updating them on a regular basis.

second thing is those of us that in business world, for specifically, we can go to people supplies us technology, saying you give us great capability how about security to go with it. this is the part we need to continue to convey. neil: but, you know, better mouse trap, we build, we invade a lot, they come up with smarter rats. who is leading whom right now? >> that is -- that is the cat and mouse chase using that example we're on all of the time. we get better about protects against phishing e-mails for example,hat commit identity theft, they figured out a way to get around that is source engineering they call on the phone, send an e-mail that appears to be your pay statement. neil: they seem so much smarter now. like, they are almost like

testing out simms for a -- systems for a big hit. >> i don't know they are much smarter, but we built a system that allows them to get away with stuff. that we could not i physical world, that goes back to whole issue of world we're moving into, pretty much embedded now, but moving into for example television is this center of our world, and our home, our mobile devices, that once again, we know the examples from past about how criminals and hackers and nation state ofs have taken advantage of this but we're not building that into infrastructure we're building going forward, and we're nod educates the people, not getting work force ramped up to deal with this environment, the end users, unless do you a show like, that many don't hear about it. >> you are right. thank you for guiding us, howard, i would love to get you back, howard schmidt. cyber czar, he knows. s.

you want to cut more spending? get ready for more horse meat, the liberal scare that is like total

>> i'm sorry, i can't have you in here, punching the meat, there are not too many things you can't do in here, but that is one of them. neil: if you love meat, things could get rocky, warning if automatic spending cuts kick in, it could have to shut meat inspections down that would shut the industry down, tea party gina loud en said a tactic to scare people about cs. gina, what do you make of that strategy? of putting the fear of god into folks?

we're talking about socialist salad bar agenda of obama i guess, he will threaten what threaten what conservatives what eveready-blooded american loves our meat and bacon, he willay, if i have to make cuts i will take away things that conservatives like, you have your low information voters who come in behind the president and propagate the scare tactics to make us think we can't do the cuts in government or we will lose everything that is american, this is ridiculous, more smoke and mirrors. neil: scott, do your customers say, how do i know i'm not eating mr. ed? what do you say? >> that is why we have the inspections. to make sure my products come from where i wan them to come from my choice meats, and my top quality bacon, i triednese

inspectors, that is ridiculous they are thinking of cutting some of the most important parts of governments for -- so many otherlaces you can could spending, our food safety and food quality is not one. neil: assuming by what they want is more money for thisnd that this would prevent what happene abroad from happening in your case, but not a given, is it? >> you are right, this is really a question of free market economics, this is part of socialist agenda, americans who understand the free market understand that concept. who is mr. slater afraid of? is he afraid of the inspector or more afraid of a person eating in his restaurant getting a bad burger, and then making a big deal about it, lawyers up and going on social media, we know the answer, the free market regulate a lot of these things that is reason that the threats, are really fake threats, and scare tactics, instead of just

discussing the issues and in a transparent way, as this administration said they would. in both of their catc campaigns. neil: scott, your argument is a good inspection service removes any doubt that anything you serve is not what you said it is? >> there are so many checks and balances before it gets to high restaurant from actual slaughter thousand distributor on my restaurant. -- too my restaurant, our number one priority should be safe products and what the guest expects, what is on the menu, this, this is getting rid of heart and first stop to make sure that everything that comes out of that facilitiesre what we are packaginexpecting for am, to move this aside and use smoking mirrors with what it is, a scare tacc, trying to scare people, this is outrageous, to

have somebody like me worried that the inspections will take two weeks off and close down my most important industry that is not right. neil: that compels anyone to not cut going anything. >> don't touch our bacon, some things are sacred. neil: you will get kicked to the bone, thank you so much we appreciate it. >> illinois is tearing down a tidalwave of debt, why not just go bankrupt? the boys used double miles from their capital one venture card to fly home for the big family reunion. you must be garth's father? hello. mother. mother! traveling is easy with the vture card because you can fly any airline anytime. two words. double miles! this guy can act. wanna play dodge rock? oh, yoguys! and with double mile you can actually use, you never miss the fun. beard gring contest ango ♪

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neil: too many bills too little time, now the land of lincoln is just about out of time, illinois is the verge of bankruptcy, i'm here is say go bankrupt already, quit scaring us. many companies have survived to live another day. why can't our states, ron meyer

said he hopes that illinois goes bankrupt a soon. so, ron, your position here, bankruptcy is fine? >> yes, fine, i say let illinois go bankrupt, there are two options, one they allow governor scott walker to come fro wisconsin to illinois and fix the budget problem. politicians in illinois have been pai off by public sector unions, there is no way they will renegotiate the pensions, only way to do it is to file bankruptcy. fight for the taxpayer, the public sectorrion unions have de the pay for play deal, and terms of politician given them huge pensions and huge policies, we need to break this cycle. >> in a perfect world, i guess,

but bond holders, and secure spreadtors, you have a bunch of people who'll get soaked. neil: they would move to the front of the line. >> if they do move to the front of the line. you have you know, then at end of detail ill said they want more credit, and they will not be able to, who will fix, roads and bridges and school. practical application, you can't have a state to g bankrupt, they are too big to fail. neil: not that i recommend it for anyone but there is a point in if they are not showing resolve to get their expenses under control to address from union contract to costs in municipality, then only option is bankruptcy, many a company have survived. some have not, but, they lies of risk, wat is so bad about the bhfd word

b-word. >> states are laboratories. it is as if risks are all gone, you have a term lik bankruptcy that could have real negative consequences went the statement, a shame that threat of something like that has not led the state to reform the pension system, other thing that illinois has been asking for, reports they have beening into for a federal bailout of their pension system, other states like utah and michigan have taken steps to put in hiin place reforms, so they y more in and get less out at end but a promise that can be comment, state like illinois is not willing to make the changes there is no sense of a real consequenc if in a don't. don't. >> the problem with the state like new jersey and illinois, a tremendous aim ofiabilities, and point why essentially to will be impossible to do anything about it you are talking -- >> if you declare bankruptcy

those agreements are none and void -- nul and void, an easy out for those who want to avoid making tough choices, right? >> well, it is a -- i think it is a good solution, it might be what is best for those employees, if you keep pressing this oand keep delaying the inevitable, you may not be able to pay the pensions a all, what is bes to renegotiate the contract and realize, that we have -- we can't keep saying, we're tax people more, illinois already had a 67% increase in income tax, 67%. they followed obama model. there is no more money that can be gotten from there, they have to do something, otherwise the employers will lose it all, you are right, bankruptcy is an easy choice. >> easy? neil: the rry is what bankruptcy on table, you are more or less telling people who'll be hurt by it you will lose some money