neil: you think you had a bad gust, at least you have stock. th guy has no support, no friends, no support. so far no luck. welcome, everybody, i am neil cavuto. syria opened the wound, but it has been pestering for years. we have zero global credit. nobody respects us. they love our music, they love our food and fashion, but when it comes to eating what we say and follow what we believe, they do not. and they won't. the past few days made that very clear.

britain thumbs its nose at being another form conflict with us so count them out of the syria coalition. forget whether president obama has to do this one solo, ask why. in 2011 he helped marshall 21 countries to go after qaddafi. now should we go after assad? it has not even been over two years and nobody has our back as we try to cover theirs? what does that say about us? the russian president who toys with us or a spy who wants we want back but he will not give back. and a military which we have given millions reinvesting its interest with us. a saudi government assuring egypt they have their back in case the money stops flowing from us. the chinese goverent blasting our debt and investing less in us. a german chancellor who mocks

our ways. a french prime minister who mocks us for being inconsistent. canadians who say we have abandoned them on a pipeline and we wonder why our coalition looks like a pipe dream. maybe it is because we're out of ideas, maybe it is because were out of excuses, maybe it is because we' out of money. i don't know. beggars cannot be choosers but they can be losers. i hate to break it to you, we look like losers. unable to control our government. all bureaucracies on the brink of shutting down. abusive agencies that even when they are caught, they just double down. annand effective popolicy that o limit two effectiveness. forget about losing our credit, we are losing our country. good thing they still love our movies because this president thinks he is within the world

over with his political will, pulp fiction. it is not fair to put this all in one president, looking at just the middle east it seems they have always hated us. this president thought he would change that. it is clear he has not because you can talk about a new tone, every time i look at these protests, the sold america is sata protest, he is unfortunate to see it unravel under his watch. we left with few admirers and fewer friends. a story that makes it so tough for us. increasingly give the world less reason to follow us. it could give us little reason to invest in us. you keep doing this and lose respect, you lose your draw. >> $81 billion fled out of the country according to the fed department in june, the most

recent data, that was a new record. double the old record from last month. it is everything, treasury and security, equity, whatever you've got. people are pulling their money out of the country and putting it elsewhere. that is a huge problem because we have depended on this to financeour spending ways. we have no other way to get it done. neil: this whole british thing, maybe we overplayed our card, but it is like we have to beg, borrow and search for friends, anybody who will listen to us. >> the house of commerce is a real shock not just the obama administration. i think everybody. interestingly the house of common that vote in the house of commons will be a backbone implant for congress to start reasserting itself into war powers which they have not done in a long time, so there could be a bigger impact there.

what do people respect abroad? they respect strength. if they sense the strength is not there, weakness has replaced it, then they go their own way, they say what they want, they what they want and some cases they are expecting uncle sam or should we say uncle sugar to do the dir work. neil: do you think we answer this by being more part of the global community and not sort of as president bush had done it actually backfired. spiegel have never seen it to work in international relations. i really haven't. i think they're going to be sending a telegram to president obama based on what secretary of state carey said asking for the peace product back. neil: the bottom line is i know you have gotten into this on your show, we have benefited

financially to cause the trouble is we in the world are troubed more. we may stink, the world stings more. that may be changing. >> seeing the money flood out shows they were here for one reason, ben bernanke made everything very, very easy. it wasn't what you are talking about. the wanting to invend be a part of the whole situation that wasn't a reality and hasn't been for the past few years and they were only here because of what was being provided in artificial way. when that goes away as we know it is going to come that money leaves with it. that is a big problem, that is how we finance our debt and the spending, that is how we finance the war we are waging. this is a big problem. neil: i always think this whole notion of beggars can't be choosers, but they are not effective. our debt and our problems have made us a laughingstock to the world and when you can have all the money it is like the rich

guy gets the respect walking into a fancy restaurant and the pr guy doesn't. i wonder if we are looking more like the poor guy. >> we cannot control our debt, we can't control the government, we cannot do anything about waste and spending. frankly president obama at this point couldn get a mother's day resolution passed through congress. how could that possibly generate strength and respect? it is not possible. neil: thank you very much. maybe the reason we are losing folks trust is because we kee spying on them. former cer czar just returned. how do they fear about all of these revelations? >> i think europe has lost trust in the united states. they look at snowden as a hero, the whistleblower who exposed

the national security agency and programs in t united states. neil: i was wondering, it is like they are gambling here? of course they had to know there was spying going on. when it was spelled out, did that startle them? or was it just so much of was on our friends? >> they are more troubled by the institutions inurope. neil: when they found out it was the closest like france, germany, they recoiled that. they are big into government but not big into spying government so it hit at the crawl, didn't it? >> the government were aware of what was going on because they were working with the united states but the citizens were not aware and there is citizen outrage all across europe. neil: do they think we are out of control with our agencies, all of the snoopi agencies armed with $50 billion plus

budget that can do what they want to whom they want whenever they want? is that what they are thinng? >> indiscrimite use of the capabilities would be a key quote i heard in many aspects of the conversation. neil: i like that. melissa hathaway, thank you very much. >> thanks. neil: it is not just the nsa giving the creeps, it is the creeps at the irs giving americans a bigger case of the creeps. you are so out of your mind area did next. when i first felt the diabetic nerve pain, of course i had no idea what it was. i felt like my feet were going to sleep.

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neil: what is that i keep telling you about the best defense is always an even better offense. belittled and badgered still coming out at it tooth and nail continuing their harassment of tea party groups on invaded. still pestering, still intimidating. still fuming. far from slowing down as you predicted and as you and your colleagues experienced, still unbowed are.

>> they have gotten a bit greedy. they did effectively unde undere the efficacy of these groups at the election. the activism was somewhat oppressed by the fact they couldn't deal with the irs, they were afraid. even quoted in the "wall street journal" saying she would go places and there would be empty chairs and everybody questioning whether the tea party was a good label anymore. but this has backfired on the irs because now at the tea party patriots, their donations are tripled, the staff has doubled because people are seeing this not as a conservative versus liberal thing, but it is imperial versus we the people realizing because it is the tea party today, icould be any group tomorrow the government decided to suppress. neil: that they very well be

right, i don't doubt gina for a second, but if it was supposed to give the irs pause, they are not positive. they are just going full throttle. >> going thing i would ask you is when has the irs never been on offense? they are always on oense. as long as i have been studying this, they never retreat. one of the things i find fairly outrageous about the state of this scandal, i have interviewed some of the lawyers and the heads of the organizations tarted, they still have not been madewhole. a lot of these organizations after three to six months, they still have not received their irs tax-exempt status. what is with that? i believe republicans should be getting on the case after all the irs typically works with congress, the congress has oversight of the irs, why aren't those members of congress

putting more pressure on the irs to stop these attacks on conservative groups. neil: i mentioned it in prior visits whether it is the irs or the nsa, old agencies that have abused their privileges, they feel undeterred because the budgets are never cut, nobody at the nsa or irs has been brought up and told you are fired. why should they? >> that is exactly right. steve makes a great point, heads should be rolling from the perspective of leadership and congress as well. you see the dirty little secret is the g.o.p. establishment hates these groups as much if not more than the president. you have a heck of a thing these groups have managed to endure this sort of harassment without

really any of the media on their side except a few and some newspaper outlets, so when you look at the survival of these groups that tells you the real tenacity of the grassroots that is relentless and will not stop until we overreach the government. that is exactly what you are seeing, that sort of tenacity. >> don't forget you have the leadership of the democratic party. a few weeks ago they said case closed. there is nothing here. so that only continues to embolden the irs to engage in this kind of criminal behavior. neil: that is where the mainstream media comes to be faulted. the only agenda they have is to close the case, but not on our

watch. >> thank you for covering the story. neil: this is everybody. when this happens one group, it could happen to any group. good news, only 43% of americans are not paying federal income taxes. we can get this down to

neil: here's the good news on taxes, percentage of americans not paying them going down. here's the bad news. itis 43%. is it a litle weird when we start looking this thing up hashtag just because a number of americans not paying federal income tax is not 47%, mitt romney would be proud it is

43%? they used to be more than a trillion dolls is progress? what a load of clash, which is what we're doing on this subject. adam leschinsky says it is an improvement. >> we're looking at this seeing more people are paying federal income taxes because you can't have more people not paying for the benefits we get from the federal government. poor people understand more what their game is going towards and the overspending problem but the bottom line is the matter how may are paying federal income tax you can confiscate all the income everybody in this country and you still are not paying off the debt or trillions of dollars in liabilities and you will not make a difference to moving the economy forward. great number of people not paying taxes is less, but that

will not solve the problem. neil: what i worry about, we are cheering the 43% figure. that is still 43% not paying taxes. i understand military folks to be sure, but i just remember when i got out of grad school it was in the 20s. maybe it was more decades ago, but you get my point. it is weird we are looking this up. >> progress is progress. wwe're talking about federal income tax so people pay all sorts of taxes. neil: apples to apples it was in the '20s. now that is progress from where we were recently, but not from where we were not so recently. >> one thing katie said, there was no discussion of

confiscating all of everybody's income because if we did it would have an impact on the deficit and the federal debt. neil: you are not advocating confiscating peoples income. >> i am not advocating it, nor is anybody else. >> the point of that comparison was to say no matter how much money you take from people you can't pay off this debt. whether it is 47% or 43% paying fedal income taxes doesn't matter because we have a spending problem. neil: i do think there is something to be said about everybody getting skin in the game. are we closer to that, or will we be? >> we are clearly closer to it. there are poor people, people who don't make enough money by the way we have things structured now to pay income tax. i wouldn't disagree with you if

it was in the 20%, that is where we should be aiming for again, and we're moving in the right direction. neil: in the meantime do you ever of tech companies complain too much, they say they are offend but apparently a lot of money contributing to the offense. the nsa is paying millions of dollars each year to access data files and more. re than $52 billion shared among the various five agencies to get what they wanthenever they want from whomever they want on whomever they want. that is kind of creepy. >> it is creepy, basically hush money to give it to corporations already making money to have the corporations turn over information that belong to the taxpayers, corporate cronyism, it is an incentive to make money but dangerous when it comes to the government coming in and

saying we will pay you all of the money so long as you hand over all the private information of your private customers. i don't think it is a great idea. neil: they say we are against this. were you paid to provide this. we are against this. >> i read it slightly differently, we should be rutinizing all of this an make sure the government is acting in everybody's best interest, they are compelling the companies to provide them information that they are seeking from them. they are compensating them for the trouble. nei thanks judas for the trouble he went through. you can put any spin on it you nt, adam did >.

>> they would say no thank you, i would rather sell my service to the customer. but you are not giving us a choice, so we argoing give you this information because you are requiring us to. neil: so you get some dough for it. >> it is almost like eminent domain. they say because we're forcing you we will end up paying you r it, but it would be nice if they would complain publicly about the nsa overreaching, they would come out and say we are against this and don't like the idea the government is bribing us and forcing us into this with consequences coming from a big government. neil: we have had them all on, nobody informed me they were paid for it. guys, thank you both very much. in the meantime you think these guys are the frontrunners for the republican presidential nomination? you may want to keep your eye on this one.

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something better. neil: we found a republican who does have something better and it is already up and running. the health care plan he assist not only works but saves a lot of money. the governor now here to explain. what are you doing in indiana? >> since 2008 we put a program on top of traditionalmedicaid we call the health indiana plan and it is a program where the state provides an insurance policy for people enrolled with high deductible but we have power accounts and they operate like a health savings account wherfor the state makes a contribution, and ultimately encourages people to make health care choices we had choosier consumers, getting them from the emergency room and primary care,

it has been very popular indiana, very successful and is most people know consumer driven healthealth care is the pathway toward lowering the long-rm costcost of health care as well. nei governor, is it mandated? >> it is a program in which people may enroll. neil: it is not like massachusetts or romneycare. >> that is exactly right. we got a grant to create this innovative new program that is really grounding in the principles of personal spots ability, individual freedom. as i said it is contributing to the health and well-being of people enrolled in the program. 95% of the people are very satisfied with their coverage, and beyond that as well. when you look to the experts and you say th see the rate of growt

of it is distributed to consumer driven health care where people are taking more ownership in the health care choices. neil: i was looking at your plan and what you are doing, that gives you considerable political crowd on national issue republicans seem to always be on defense. that could be a nice launching pad if you ever do entertai higher ambitions. what do you think? >> what it is really evidence of his when you give states more freedom and more flexibility to innovate whether it is in the area of health care or other areas, you will get better ideas than a one size fits alat the affordable health care act in washington, d.c. i am someone who had a ance, you ar and i have known each otr for a long time, i have now been in this job for the last eight months and i am more convinced

than ever whether it is economic policy, infrastructure, hlth care, giving states more freedom, more flexibility to develop their own ideas and their own sutions is a pathway back to prosperity. neil: what do you think this effort in congress to defund health care, or do we even attach it to measures that would risk shutting down the government. or congress by forcing it. what do you think? >> my focus is on the hoosier state. everywhere i go indiana obamacare is stifling our economy. barely a day goes by i don't talk to a business leader in business large and small that isn't making decisions about not hiring or not expanding or letting people go from full-time to part-time because of the impending cost and mandates of taxes of obamacare.

whether it is delaying the imposition of the individual mandate or other measures in congress, i think all we can do to repeal this lawto mitigate the impact of this law in our economy will help states like indiana get back on our feet. neil: in an efort to defund that, it is very unlikely to happen. so why do it? >> i would leave that to the guys in your chair and i will let washington take care of itsf. i do want to make it clear to the viewers there is no question in my mind obamacare is stifling our economy and if delaying the impact or other efforts to amend it or repeal it would go a long way. the solution to your point earlier if you give states like indiana was given back in 2008

the freedom and flexibly to come come up with alternative solutions in health care in particular as well as other areas, you'll see what they call the laboratories of democracy come up with new and fresh and innovative ideas. that is what the hell the indiana plan is, frankly reinvigorating the ability of states to innovate itheir own way for their own citizens as a pathway forward for the country. neil: that is an interesting example. getting a lot of attention what you are doing. always good to have you, thank you. >> thank you, neil. neil: unions on the verge of getting a health care passed. it is looking like he has navigated around by navigating unions a a big assumption of the health care law most costly provisions. you won't believe how he stands

to be on the verge of taking care of it.

neil: i love that graphic. here is when the president knew the health care law was in serious trouble. when the unions started whining about it. once he started attacking the health care law owners revisions the generous health care plans like a lot of union workers, the white house scrambling behind the scenes to keep him happy, to keep unions happy, but what about the rest of us, will we be happy? the president is said to speak next week by which time maybe this is all settled. it is just unsettling. >> not surprising though.

labor unions are the driving force behind the party. that is where all the money comes from, all the energy comes from. this was inevitable both the unions would have a huge problem with this, benefits of the majority of the compensation, that is the whole point. of course benefits will be hurt by obamacare. it was inevitable they would be some sort of a rveout. the white house has accommodated, there is no choice. neil: with so many carved out, who is left paying? >> the rest of us with no political jce. nancy pelosi's district disproportionate number of exemptions to obamacare. of couse this is what happens when every large government program any kind of massive

bureaucracy at braves patronage, really. it has been going on for centuries. neil: the more people who are not paying in as planned, the more that wi be stuck in with this. >> it mirrors the tax code, shrinking number of people for the bill for an ever-growing number of people on the federal budget. as this country gets divided into two tiers. the with political connections and those who pay for everything and those who are along for the ride. neil: interesting to pick your brain on this effort going on and even shutting down the government with congress as well. it will be the president signing off on it. it would really be on them for forcing it.

i do know it is the battle royal, mainstream republicans say go slow because we have been there, done that, what do you think? >> obama has been unpopular, people are afra of it in a lot of cases. if you are united, we can probably win that debate for the public. they are split right down the middle with the establishment fearing this kind of standoff and republicans. neil: so they fear anything that shut dow >> it is at 94, 1995 all over agin. neil: they say we will risk that. >> it is a shame because if they thought a little bit and decided to implement some of the pretty good ideas of health care, how do we improve health care.

we arare not going to repeal it, obama is president. the president has to sign that, he is not going to. so how about tort reform. the only people against tort reform are like rich trial lawyers. why not take that issue to the public. neil: you have had no sleep, have you? >> i had a lunch you would not believe and it is fueling my rage. neil: i love that. thank you, always appreciate that. what if he had said i reminded him of ted baxter? i would have been offended and i would have sued, right? a wman who was offended and sued because the boss said she resembled susan boyle.

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♪ neil: they say she has the voice of an angel. not to be confused with the body of the victoria's sret angel because when her boss compared her to britain's got talent sensation susan boyle, laurel ls the one bled. i get it wasn't a compliment because her boss is talking about looks.

now her boss is looking at a $6 million lawsuit for harassment. does she have a case? what do you think? >> the company has done their own internal investigation and did not fire the boss so perhaps the reviewed e-mails and found he said that he was looking to make his own perfume company, and thetalk to their own employees who denied it. this shows anybody can go into court and as long as you have the proper allegations and file the right forms you can get a lawsuit going. neil: do we know why? does she have a great voice or what? >> we don't know. >> e-mails are part of the story but allegations go beyond e-mails. neil: i look like susan boyle, but i digress. >> the allegations in this case

go well beyond the contention somebody one day said i think you look like susan yle. the allegations are a tort-based claim saying she was repeatedly and openly abuse, emotionally abuse, treated like an emotional punching bag in the office, a high-level dinner with a high-level client and also a contract claim saying there was a failure to pay based upon a commissn claim. this is not complicated. i understand she is claiming $6 million, she will not get that, but these are real claims and these cases can be emotionally volatile. neil: you need proof, you need others who witnessed this or that he was saying if he did say it in an unfttering way. >> you don't need proof to bring the claim. you need an affidavit and affirmation of an attorney.

you can say anything happened and it would be up to the company to defend itself and defend its employee. neil: in that case they are trying to find a negative that was never made it >> will have to say their employees say we did not hear this. none of this happens. and also they will look for ways to show that her damages like what she suffered was not caused by any pressure at work, just the product of her body mist functioning. >> the plaintiff has initial burden of proof and she will have to bring forth witnesses that willay in these repeated social instances in the office, out of the office, high client party, she was being verbally abused. but you don't have to rely on that for the breach of contract claim. the only way the company can come back is to say she didn't adequately perform. that would be a tough sell. she was promoted, put in charge

of the biggest account, that is simple math. she will not get $6 million but the allegations go deer than that. neil: this will sound sexist but there is a point, what if the boss compared her to pamela anderson? >> perhaps they wouldn't be in this situation although the company and the boss denies this happened. but that also could have been a form of harassment. neil: but she would not have been offended, isn't that the gist of it? >> we don't know if at would have offended her, that is up to her. neil: all the dog days in all of august? after a very rough month, a september to remember. [ male announcer ] if you're taking multiple medications, does your mouth often feel dry? a dry mouth can be a side effect of many medications

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neil: a summer sell all, it take over and ge capital shocker? what you should be investinin and what you should be on the lookout for. a struggle in syria and a government bracing for a shutdown. no wonder stocks are sliding down, and in the worst month of may, 2012, and keith fitzgerald says uncertainty could keep slamming stocks well into september, others say stocks will rise in september. give me the half-full glass version on this. speak ou > it has been bakede market. i think you saw that really as soon as kerry was done talking. neil: is it bakes in going alone as well? >> i think so.

investors and traders particularly are prepared for that scenario because after written bailed out, we would be going more or less alone. the economy still fragile. i n't think the fed will pull bacback to drinking water anytie soon. i think we will rally just like we did back in the da of the gulf war. neil: and optimistic view it will not be that bad. you say not so. >> i have a lot of respect for you, but i will say not so optimistic. you don't go to war halfway. the law of unintended consequences. we will see 5% to 10% pullback. that will inversely prompt bernanke to keep his foot on the gas after a sharp september pullback. neil: there is another view on this, gentlemen. going into something stocks could hit, oil rises, gold rises and when it looks it is staffed

and looks good initily everything and everyone calms down. you don't seem to be optimistic of that. >> it depends on the speed. bernanke in the early stes of losing the bond market, a lot of this comes dn to certainty amongst institutional traders right now. the investors don't have a lot to worry about, a diversified portfolio, i have been looking for things to buy right now. ge is a great example of that. >> you do look to rally. >> i alwaylook for a pullback. neil: in the meantime,tablets aren't bad, why rpcs fading? computer shipmes is waiting to drop 10% this year. is it then time to drop the stocks that make these computers? hp, dell, what do you think?

>> yes, absolutely. i don't know anybody who has bought a pc lately. when i came down to d.c. to do this show, i would bring my laptop with me. now i can do everything on the ipad. the days of dell, compaq, whoever is making pcs that has gone the way of the portable phone you used to have in a suitcase. neil: what do you think? >> i have my tablet right here and i used to travel with a pc and i have not traveled with one of those. i cannot imagine this is a longevity plan i.1?z

>> seven for every human life on the planet today. neil: who comes up with that? a the best. you could be right. finally trying to give shares of ge earlier while some say general electric spinning off the lending business ge capital is a bad sign, you argue maybe what? >> it is a great thing because you're getting out of the fancy engineer business and getting back to making stuff. ge is goodat making stuff and making stuff worldwide. i want to separate that risk so i am happy to see this at long last. neil: i remember the days ge was really the money making arm on its own. what do you think, gary? >> i think it is good to spin it

off. any time a company spins off a business not part of the core competency, something it is not known for, think it is a good idea. expedia was not really a travel internet company, that is not microsoft strength. ibm has done a number of them spinning offprinters and pcs, it at least was not where ibm wanted to go. neil: ge and ge capital. >> i own ge, that is one, and if ge does this and a publicly traded company, i would definitely buy it. >> absolutely. neil: i do not like you guys agreeing so much. in the meantime, i want to close on another phenomenon in august and twand to both of your points

earlier the run-up in oil, and the fear factor in oil. i guess it goes to this notio what if oil ports are shut down, the suez canal, what if iraq shows production, that is a real kind of compounding fear and may have been one of the reasons he was saying we could see $150 threat in crude oil. our oil would likely follow suit in that kind of a perfect storm. what do you think? >> that is pretty on the mark. i see gs prices at $4 not really coming back. the other way, if there is no crisis, the economy is chugging back. you know i like the chart, it is going to $4 per gallon. neil: i guess it goes back to

the length of the potential battle for, whatever you want to call it. if there are members in this region that's just say we sympathize with what is going on in syria and we will hit the west where it hurts, then what? >> when it spreads, not a question of if, it is when. down to 30% or come in from the middle east so at least we have a little national storag but the price is up, generality is probably right. probably not far off the mark. it added a lot of flair to the show. >> i am on the west coast.

neil: thank you guys very much. just a reminder to all of you, sometimes we get overreacte on this labor day weekend we stop to celebrate the working people of our great nation. but with 12 million of us unemployed or working less than full-time, it's kind of hard to use the term celebrate. it seems our focus now in this country is on a number of other things. we're talking about whether the lousy job market is fixable. right here, right now. >> from the fox business network headquarters, it's the tom sullivan show. here's your host, tom sullivan. >> thanks for joining us. here's what we have for the top of the stack. we have plenty of big problems facing our nation, but when asked, people consistently respond by saying jobs or the