neil: all right, allow me to cut to the chase, they can't cut, they won't cut. the one guy who is trying to cut, they won't cut a break. try getting trillions. welcome i am neil cavuto, queue the crying over ryan again, former republican vice presidential candidate is taking out his scal scalpelgain, you wd think this time, he was not only throwing granny off the cliff but her whole damn family, actual that's was harvey corpsmacorpsman.

what he is cutting in this budget of his is the growth in the budget of uncle sam, 10 years out, ryan's plan envisions a bigger budget, how bad can the budget be if it takes 10 years to erase a deficit? how tr draconian can the cuts b? only in washington can you call him dracula for doing something that is not draconian at all, a budget that slightl alters spending on. ryan is cutting to 41 trillion bucks, that does not sounds doomsdayish to me, ryan is growing spending on average 3.4% a year versus close to 5% right

now, out of stuff that triggers talk of terror, remember the folks who were terrorizing over those anything but doomsday tra draconian sequestration cuts, talking of decontaminated beef, and maniacs getting through our airport lineses, now you know wy they are treating paul ryan like he is a big pain in the ass, he is not, maybe the asses judging help are, but he is not, talk about a party punch in the one corner, paul ryan with a plan to get a budget in balance through largely spending cuts and largely no tax hikes, in other corner democratic senator patty murray. a case of us likely losing, because the cuts really are not

there we have rick yo joining m -- a little boxing reference, you have to know that. all right, so, what do you think elizeth? leaving aside in controversial things that paul ryan wants to do. in the en, just trimming the increase, that is it? >> yeah, i think one of the big thing here's that people lose sight of is balancing the budget, patty murray supposed budg does not even balance, it is supposed to raise a trillion in revenue, that tells you, this is more of a shopping spree than a budget, people need to remember that a budget hopefully means you are only spending as much as you take in, not more. neil: scott martin, the markets seem to sense, maybe that despite all of the just erring

-- gesturing we're at least, cutting the growth and stuff, we're not really cutting but that is better than doing nothing? or am i misreading the market? >> you are reading it correctly, that is a reason we had such a good year, we were leading up to the sequestration dea deadline, which we made it. to i agree, still taking out the scalpal or peeler if you will, instead of the steak knife is tough for the economy, senator murray said this is a great plan for everyone as being pro-growth, i don't know what a trillion dollars in national tax rates is going for growth, i don't see it. neil: rick, you are tight with a lot of powerful democrats, i know what bothers them is he is taking on entitlements, he is not really he is taking them on.

carney said yesterday, think of changing the ages, and you know and a nonstarter. so, if entitlements are off the table for a lot of democrats right now, we're going nowhere fast? >> you have to be a little bit careful. we know that murray's budget, opening shot from democrats ryan's budget opening shot from the republican, president somewhere in the middle, important to keep this in mind. i will tell you, i have to disagree when you say ryan budget does not take a cleave torent tight imminents -- clivecleaver to entitlements, 5n medicare and medicaid that is heavy, the thing that shocked me about his budget, i have to tell you, you know i'm not the biggest fan of representative ryan, but it at least it has been real life, he based this budget on a fantasy, it stunned me, on revoking obamacare, you

can like that idea, you can hate the idea, but guess what, it is the law. neil: in the end, all of these entitlement programs will get more funding than now. >> no disagreement there. neil: your calling that draconian? >> 59% of the cuts from one area. neil: leaving aside those cuts which is a good point, you could argue then patty murray's plan to do this on the back of hiking taxes. >> right. neil: you think these are starters to get a deal in the middle. >> at best, i think i also note that president is somewhere between the two. and you have to ask the question, is that by accident or is that on purpose. neil: elizabeth, i look at this and realize with theater we went through on $85 billion in sequestration cuts and that nightmare, now a immediate response, every time you touch entitlements you are throwing

harvey korman off a cliff, there is no way you could get aad if they were going after paul ryan last year, they are throttling down on him this year. >> i know, but other thing neil, in the drama where we talk about 85 billion, president obama said he was willing to deal with democrats in his own party who did not want to touch entitlements, he said he would be willing to talk to people in his party that did not think that medicare should be touched. why smart with nonstarter -- why start with nonstarters? maybe, to rick a point, this is a starting gate, they have come out with plans 24 hours apart, different plans, but, i've seen how this goes. maybe this is an attempt to find a meeting in the middle, i guess, scott martin, where is that middle? >> that was my question to you, where is that middle?

i have to bet rick a sugary style new york drink here. >> he is fit as a fiddle. >> you have not corrupted him yet, the president loves murray plan, i think there is no question, with regard to the attack on medicare, and medicaid, you have to go the number is to big 59%, because those are the big ones, you are not going to make progress if you don't touch the big elephants in the room. >> you do have to go after the big ones, but there are two big ones, entitlements but what is the other one? defense -- not a penny. neil: but, when senator coburn goes in with a plan, with 360 billion from defense, and finds other republicans open, everyone needs to see the axe, i

noticed more reluctance. >> think you will be surprised. neil: you keep telling me, that i'm waiting. >> it is not time yet. i think you will see president step up to the plate in next 3 to 4 weeks that is my guess. neil: what is she going do. you -- what is he going to to do, you could step up to the plate and strikeout. >> i am optimistic, i think a grand bargain. neil: we'll have all these guys back. in the meantime, if you tax them they will run. businesses bolts out of california because of taxes. >> and the dow hitting another all-time high, but today a warning about the price of stocks, and the price of just stocks, and the price of just about everything else, the capital one cash rewards card

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taxes, so the news is that businesses are taking a hike. metlife shipping 2600 employees from that state and others to a lower tax state to north carolina. republican governor north carolina with whether he can make them feel home. good to have you back on. an offer too good to refuse, what drew them? >> a great quality of life, a good business climate. and a great workforce. in north carolina. so, they are setting up, we have 2600 new employees for next 3 to 4 years, they will live either in charlotte or kerry, raleigh area of north carolina, two different areas, strong areas. and these new jobs will help build our economy. i think they made the right decision, we're glad to have

metlife, a gri great company coo north carolina. neil: there are a lot of zero-tax states like texas and florida trying to do what you are i do, the governors have a contest to do that but there are fewer of you guys than the high tax state guys. what happens in you woo those jobs the republican-run state ewhat do you offer they do not? >> rick perrynd nikki haily and bob mcdonald, we consider them competition, they are friends but they are competition, we welcome the competition. rick perry and i saw each other two weeks ago, we said we'll fight for our jobs, he is going to california, i fight for jobs to keep jobs in north carolina, and i'll take jobs from any place, i like to get them from overseas, also some international companies investing in north carolina.

and we're having good news success, and the metlife announcement of 2600 jobs with is a positive signal for north carolina, our biggest challenge right now is small rural towns of north carolina, throughout the u.s., that is our greatest challenge, but markets like raleigh, and durham, and greensboro, and high point, and charlotte are coming back. neil: you could look at and say, despite right to work, and your en treaties to win them over, you still have a stubbornly high unemployment rate, it is coming down, othersould say, low taxes great locale, and great cities, you canon ge get you so far -- it can only get you so far, what is the problem? >> in the past 5 on 10 year we started to raise too many taxes, we were not being competitive with your next door neighbors in virginia, tennessee or south

carolina. we're looking at doing just the opposite, i know what my competition is doing, we plan to beat our competition, we're looking at tax reform, where we can lower both the income tax and corporate tax, i want to reward productivity, not punish productivity. we have to keep making things and building things and en vating, those -- invo vating, those are companies environment brincompanies that i wantto brih carolina's work force and our tax climate and quality of life, and right to work status, which we've had for a long time, and we're got goiig to change it, is a great retributemen recruitmen. neil: how much do you look at problem that boeing has been having, to get the dreamliner batteries fixed. were you breathing a sigh of

relief? >> if you talk about the labor unions, and what the obama administration was doing with that, that is ridiculous. i'll fight with my fellow competitors even in south carolina to protect our right to work stat us in north carolina and my neighbors competing states, that very important. neil: regardless, both and other companies to look to right-to-work states, your own included, that is not disrupted by whatever problem it had? >> no. no, not at all. and the other thing, we have to be careful is not accept federal money, which also often requires union work hold, work. those are other things we have to fight, but we'll provide, good edution, at our universities, two year community colleges. and great quality of life, second to none. neil: all right governor a pleasure thank you, sir. >> thank you very much. neil: all right, this just in dow hitting another record high, eking to it, but a gain is a

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neil: forget the dow hitting another record today or how close the s&p is too another record. you might want to focus on the yield of a 30 year bond, it has been hopping of late, but still low, but not as l as 2% yield it was fetching a little more than a year ago, let's be lear, jimmy carter double digit rates these are not. but once the jeann was out of

the bottle, kaboom. is history teaching us on american sequel? march sequel. are you worried about inflation? >> i am worried to a degree about inflation. neil: what is your big concern? that fed takes principle away. >> according to last minute of of fed meeting of january 29 and 30, their expecting will be tame through 2015, and will do everything possible to keep the itheeconomic growth in a path tt it is, and keep buying assets to spur the economy, a lot of investors are concerned that inflation will kick in but the biggest concern is the if investor performance that fed wilbelieve that fed willstop pu.

treasures -- neil: rates are going to go back up. >> that is the fear. neil: we go for more than 2% to 3.95%, back and fourth, know it has been ebbing up, and the fear, i remember this, as a kid, following the whole jimmy carter thing, before we knew it, it was a 29% prime, like a rocket. is there anything here that hints of that? and that when the fed makes a promise, you are right to 20 that is a lot of time for inflation that take hold. >> it looks like the factors are not aligned to rise immediately, one is labor costs, the unemployment dropped down to 7.7 percent, but fed comfort zone is about 6.5, or 7%, depending on which estimates you believe, it may take to 2015 if

not longer for the unemployment rate to drop below 6.5, if you i did second the numbers we saw last friday, in terms of labor participation, and unemployment rate dropping down to 7.7, it was part time employment, not full im. neil: we're a long way from the 6 half. i understand, but what worries me, is when smart guys like you, so many, are not worried about inflation, that is the majority of you, maybe the i don't know the crepe hanger in me, says i'm worried, the crowd is betting on one thing, they say that the fed is going to keep doing what it is doing for next coue of years, and throughout we could see prices runp, fed has a promise not to intervene and it gets out of control, you don't see that happening? >> i don't see that happening immediately. neil: what would worry you, nick? what would you watch that would

dissuade you of that? >> an immediate movementn sentiment in bond investors, if they pull out on one end, labor participation does change. neil: in other words wages go up. but what if the get slows this down, you mentioned 90 billion a month, but talk is a slow it down to 40 billion a month then 30 billion, slowly weaning us off, what that have the same affect. >> it could, the flip side of that argument, if the economy is doing better a lot of investors are creating yield, throughout the world the interest rates are pretty low, largest 4 central banks u.s., u.k., japan and e.u. all have interest rates about zero. neil: unrealistic, right. >> it is, and it is probably not in the lg-term, but -- >> a good couple years. >> a good couple years to go, if rates do rise, there is a concern that inflation may be a

factor but not probably in next couple of years or so. neil: nick thank you. remember whether we tried to put al gore over the top in sales? he is having better luck with hank greenberg, in a different ♪ making the big romantic gesture. that's powerful. verizon. get a droid razr m by motorola in pink for $49.99.

neil: well he almost made al gore president, but now making big problem forever u.s. government, uber lawyer, david boyd. alowing a $5 billion class-action lawsuit against the government, suit claims part of the aig bel bailout was unconstitutional, representing a company starter international, david boies taking on the government, here and only here, by the way, before we get to david, the treasury department gave us this statement, two months ago, aig board reviewed the allegation against the company, and decides that they were not worth pursuing we continue to believe that claims have no merit, and we'll continue to defend the case vigorously. what do you make of just that? >> well, you would expect them to say that, they almost got to say that.

neil: a big rescue we can't reverse. >> the key thing, is that statement ignores what the judge has held. remember they made a motion to dismiss, it was denied. second it ignores the admissions they made in the lawsuit. they admitted that they did not have the authority to take on the equity, they did not have the authority -- neil: aig, further did not have their shareholder's interest at heart. >> right, and when you have the kind of admissions that we have in terms of they knew they had a fully secured loan, they knew they were not at risk. that is not what they say now, but their internal daults say documents say, that and they admitted that in depositions. they were giving loan shark rates and above. neil: the money that was used to supposedly rescue aig was a

backdoor deal too rescue a bunch of other players,. >> they take aig's assets, without telling congress or anybody they used those assets to bailout other companies, maybe they had a good the reason, but it was not right, fair or constitutional. but to take aig's shareholder's money to do that. neil: can understand in me why, aig, and the treasury take the position they do, aig today, not joining in this suit, we were rescued by the government. and all our people -- so no one wants to rain on that parade. so they are not part of your parade. but, what do you think of that? the way it is played in media, look at these ungrateful sobs, the government rescued them, and

they make the suit live today. >> remember, the government knew at the time that aig had many more assets than liabilitiy, it was short-term liquidity problem, they admitted it in court. neil: everyone had the same short-term problem. >> right, they done penalize anyone else else. neil: sohy aig? >> a combination of circumstances, they were not the government's favorite company, i think they got into a situation which the government just grabbed the money, and they needed a vehicle to do the backdoor bailouts. neil: aig said it was the way to do it. >>emember, the shareholders, remember the reason that hank starr brought this lawsuit, shareholder after shareholder after shareholder wrote him, said can't you do something about it. >> what does class action mean now. >> all of old shareholders, all

of the shareholders who were shareholders in 2008, and the iron i becausirony because aig n in the lawsuit, aig's current shareholders may not be able to share in the recovery. what aig has done, i understand why they do it given the role that government has played. putting them in that position, but the consequence is that the current shareholders are not be able to share in the recovery, unless we can convince the court to allow to us represent aig,. neil: all right that is a big up hill fight. then you -- you are essentially suing the government there, not a very successful track record of anyone doing that. this could be unprecedented and case history if you do. but, don't you think that most people, the eq part saying,,3 enough already, we had the

rescue, it might have been questionable, and it might have been heat and stupid things under fire, but it was done, it was done, it was done, don't go back to the folks who provided the money to try to stabilize it. >> but they have gotten back all their money plus profit. all they are asking for is a return of the equity they illegally took. they did not need that equity, it was fully secured without it, a lot of people don't understand what reay went othey don't understand. you and i do. but a lot of people don't understand that the government took aig and used it a a fun told shift money to a -- funnel to shift money to a lot of other private -- >> do you think that the judges and courts will say, truth be told there is a lot to what david is saying and what hank is saying but the meltdown was a long time ago in far, far away.

>> but fortunate we not allow the government. neil: they will say, we redo this blink on this, than every other institution we were rescuing to the years we took over, you go back to commonwealth bank in 80s, they will say we will rethink that and we have opened up a can of worms. >> this is only time they confiscated a majority of stock a solvent company. neil: it looked to get insolvent quick. >> liquid i, they had a liquidity dro problem. neil: in the middle of a fire do you extinguish? >> they did. this is fully secured, we're not going to lose money,hey have the very valuable insurance assets, they were able to secure, their loans for. neil: what is hank paulson think

about this? >> we'll take his deposition, and find out what he thinks. >> he is supposedly the guy that orchestrated it. >> he went on television, a few days after -- >> and tim geithner, former new york industry secretary. >> yes. neil: a bipartisan? >> like journalism with a subpoena. neil: how do you feel about that? you might offend a lot of your democratic friends ? >> the truth has to come out, i think, i think democrats, republicans, everyone has a stake in having the government operate properly. everyone has a stake in not having the government sort of override, property rights, not override indivual rights, in particular to do it without congressional authorization or knowledge, they kip th kept the backdoor bail out secret. neil: one more, question, al gore, what do you think of him

now, being seed o sued on sellig current to al jazeera, he seems like an increasingly sad figure. >> he has been subjected to a lot of criticism over that sale, he was in a difficult position, the company was not making money. neil: odd sale to the weirded people. >> i think they are weird people. neil: would you do it? >> i don't want to comment on that. neil: is he still your friend. >> yes. neil: on lift or right, one thing they all agree on is you want david boies on your side. >> meanwhile. that ira iranian cook who lookse lord farquat, is taking ben

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>> this is what i do, and i have never left anyone behind. >> i know who they are, and i know they are hiding out. >> it's over. >> they will be taken, probably not alive. >> we're responsible for these people. >> i'm responsible. neil: great movie, maybe, now "argo" to court. anyway. iran reportedly planning to sue makers of "argo," the movie that won best oscar claiming that film does not accurately portray the country. marla wha is here is is to say

iranians do not have a bliss, and douglas burns saying they do have a case. >> i think everyone in hollywood knows things get embellished, this occurred in 1979, if you watch end credits of the movie there is real-still photography, everyone knows that maybe the story line, character developme, maybe embellished as we heard aerosmith was not in iran in 1979. neil: wait a minute. airaerosmith was in iran -- >> okay, doug. i know there was some liberties taken with the movie, some generous liberties. even allowing for that, does this give the country grounds to sue. >> if you do a nonfiction project it should be true. if you have anyone standing at ticket counter, it is declined and they see president carter 10 seconds later it is approved, you know as a watcher, i

complained to my wife that is made up. you have police cars racing down the runway, after the jet, which did not happen at all. neil: i agree with that. >> the answer, first couple procedure all-tech callties, a foreign country can sue. in a u.s. federal coast, under diversity jury. do they have a good case? >> the first amendment gives way. there is an exception for false see and liable. if they can demonstrate that the producers and those who made the movie intentionally falsifies critical information they could have a claim. neil: but marla you say it is a stretch, they have not reversed gest of the movie. but that they got out, bottom line. and that was they got out, so. >> yes. that is true. neil: that takes away whole argument? or to his point, or not enough

-- along the way that even little far qua farquaad could se standards, all below sta standas but this is beyond the pail. >> this is hollywood, what next, aliens are suing steven speilberg, they did not put a disclaimer saying that everyone in this vie is 100% accurate, the characters and words. neil: and could mahmoud ahmadinejad and iranians, they really have ahance? anyway or do that? >> i honestly don't think they could rise to the burden to show there is anything defamatory, what has bn shown in the movie that imbellished is just, tha hollywood. it is acted, it is guns. you know but really what it comes down to, did it really

happen? yes people were hostages they did stay with the canadian ambassador. >> to be a broken record, a nonfix project should be true. a nonfiction project should be true. it bills itself as a that of events that happened. but one individual said that people defamed, police officers and airline personnel made to be shown as they did something wrong. neil: what u.s. court would give that creadance. >> that is a great question, and a great point, we would like to think a u.s. court would give them a level playing field. >> we'll see what happens, this is presiding. >> a bad day for new york mayor, the courts banning michael blumberg's big soda ban, meet

the woman that made this happen. >> lois, i'm about to drink my first soda, better come stop me, oh, that must be the schedule oh, that must be the schedule ar, ohsugar, oh,god that is goo, this is $100,000. oh, that must be the schedule ar, ohsugar, oh,god that is goo, we asked total strangers to watch it for us. thank you so much. i appreciate it. i'll be right back. they didn't take a dime. how much in fees does your bank take to watch your money? if your bank takes more money than a stranger, you need an ally. ally bank. your money needs an ally. all stations comover to mithis is for real this time. step sevenoint two one two. rify and lock. command is locked. five seconds.

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>> i think it was the right decision, i don't think we should be told what quantity of soda we should be allowed to drink. >> asking the government to protect us from large coke is beyond what the governmen should do. neil: a judge thought the same way, slamming the brakes on mayor bloomberg's plan that was going to debut today for large sugary drinks, the mayor saying he will appeal. the american beverage

association, and the ceo san neely, ruined the mayor's day, good to have you. i did not reali your association of so powerful, this was considered a fate acomp pl plea. this judge comes up with a ruling, he is going to appeal are you worried? >> i don't know who thought it was a fate acompli i . >> they thought they were staning to good legal ground because of success after saturated fat in the city. >> but whole, case was about who has the authority. this is the authority of a language latest body not a -- legislative body not a body appointed by mayor, only big news would have been in council he appointedid not vote the way he wanted them to, the judge said they do not have the

authority to do this it is the mar a right to appeal. neil: when the judge talked about the capreccous way it was haled. like this would even affect food deliveries and went beyond the original thought. >> there is a lot of surprise in the last week as discussions mounted in media, about, a family can't go in and get a carry out pizza and a 2-liter value pack. neil: you could get two, 1 liter botts. people forget, you have been trying to work, you have with michele obama to healthy choices, alternatives, more than just you know soda.

that has been enough to help you work with folks who otherwise think you could not. could you try the same with mayor bloomberg. >> we've said to the mayor ask us in, we have a good track record of working with people,. neil: did he not want to hear it? >> i think he felt he had the right way, but the court said he does not, we hope he will let us back in we have reduced calories of drinks in school by 90%, and you can look at the labels. we wl deliver, you just have to talk to us. neil: does it bother new a macro sense that fewer people are having sa than they used to in theast, or do you spread it out to other alternatives so your market share is up? >> we have a lot of different choices, that has been the premise of our argument. why divert attention from real

solutions, on oh obesity, people want choice. neil: like if you go to a mcdonald's, y want a salad it is there. >> or if they want a smaller poargd, the portion, we are a tm to free interprize. we have now a portfolio that is 45 per zero calorie among all our beverages that is a lot of choices. neil: whatever. you won over a lot of naysayers, susan neely american beverage association this group that i think people will not take lightly. neil: the harm from the charm, is the president pushing so hard trying to woo repubcans, he is ♪

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[ bleep ] at did you say? [ bleep ] neil: let's say that the president is saying his tour goes a little bit better than justin biebers, all that as canceling a date on his european phil flynn -- phil flynn and but we're hearing e democrats tried to distance some sows the and theyt want to deal with the republicans is he worried from his own party? >> actually we talked about this. his biggest worries will be from his own party.

it is overstating to say democrats are distancing themselves but i said from the start of president is serious about entitlemen reform. he will have a harder time with democrats. watch what is coming. speech, and state of the union address, and hundreds of billioner in in spending, i see nothing. >> i've seen it. neil: until i sian -- >> until i see a entitlement reform on the table he signs, i will be a lite bit skeptical as well. i've been waiting four and a half years for it to happen, half years. he has not yet it is the

priority compromise from fiscal cliff dial, we talked about unemployment insurance a couple weeks ago, there has been

compromise that the left has not liked. he made. bu i got to disagree with rick, unless, say that the left comes out of the meetings, with like sistine chapel with smoke coming out of their ears, there is no way -- >> trust me, when the left is in the room, and there is not smoke comingut of it, you are in the wrong room. >> you are right. neil: i'm kidding. >> he will pander to the base. you know that right will go to meetings, all stuff we put forward before that never arrived on compromise, i can't imagine now that president will say, you know what -- guys,. neil: you argue, we we talking about the time of inauguration. >> he understands what has to be done. i don't think he has any intention of making anybody worre off, we know that there are ways you can make