>> hello, folks. welcome to kudlow, i 'm larry kudlow i'm larry kudlow. already, president trump has already started using the tariff weapon and more is coming, you can bet on it we have an exclusive first interfew, with kevin hassett, brand-new direct or of the national economic

counsel in white house. and we have also art laffer and steve moore, they will critique him, and cia admits covid likely came from wuhan lab, senator joni ernst on that but first jacqui heinrich at the white house. reporter: colombia president, really did an about-face and backed down, offering his presidential plane to repatriate deportees. there was a slate of familiar sanctions and travel bans and government officials that brought the standoff to an end. congcongresswoman alexandria ocasio-cortez while this was playing out jumped at chance to criticize president trump, posting remember we pay the tariffs not colombia, trump is about making inflation worse, he is lining pockets of himself and billionaire

class, "new york post" headline that followed, aoc roasted over post about colombia tariffs and coffee prices that aged like milk. >> we reestablished law and order to get violent criminals h out, you saw when colombian president sort of pushed back on that, the american people have spoken on this we'll depart people who are here, illegally. reporter: house speaker mike johnson said trump's handling on this sept sent a clear message, saying: >> border czar tom homan said criminal here's illegally should not believe they can hideout in sensitive locations and said target list suc

expanding. >> public safety threats and national security threats, we look for fugitives who had due process over a million of them. anyone in country illegally, they are on the table. we'll go after them in priortation that makes sense, the worst first. reporter: new york is next site of action of arrests figure criminal migrants according to a official. larry: jacqui heinrich thank you so much. appreciate it. let's head to doral, florida, president trump is meeting with house republicans, will be very important. fox news aishah hasnie is joining us live. how come you get the florida beat? reporter: well, i love it i am so happy to be be here. the weather is glorious and president is in good spirits

a ran into him by ha happen chance, and i asked how is he feeling, he said he had a great week and looking forward to speaking to house republicans, i am told by senior g.o.p. source, the remarks at 5:00 will try to unite the republican conference behind his agenda, he wants to get it done as quickly as possible, here is speaker mike johnson talking about what we can expect this week. >> some d big decisions will be made, and align with senate and our colleagues there and move forward on that. reconciliation process, and other issues that are upon us. reporter: so this is the first time that president trump is hosting full g.o.p. house conference, s since becoming president, he met with smaller key groups in mar-a-lago a few weeks ago, one was house freedom

caucus, he prefers his one big beautiful bill, they have pushed forward a two separate bill track, we'll see if his remarks will move them, try to bring them into the fold. larry: aishah, did mike johnson say anything about one big beautiful bill or just hassling it out? reporter: i think they want to figure this out, he didn't talk much about it said they would make big decisions on reconciliation, and sync up with senate. larry: all right thank you aishah hasnie. >> all right, make no mistake, president trump knows how to use the tariff weapon. that is the subject of the riff. so president of colombia, thousan thought he would prevent president trump from deporting criminals back to their

country, he turned back the flights midair, thin president trump told him to pound sand and threatened to destroy colombia's economy with 25% tariff that would have gone to 50%. guess what. president petro changed his mind, and offered to send his own government plane to pick up colombian illegals and bring them home, mexico president sheinbaum at first refused to cooperate with the deportation plan and his remain in mexico executive order but now after 25% tariff threat, suddenly mexico has welcomed a total of 4 plane-loads. this is mr. trump's tariff diplomacy, it may be used to deal with unfair trading practices or closing the border or restoring national security, may even be beutused to end usha crussia and ukraine

war. and how many counties will feel mr. trump's tariffs and how quickly, "wall street journal" news story claims momentum is growing among president trump's advisers, to place 25% tariffs on mexico and canada as soon as saturday. february 1. "wall street journal" story cites anonymous advisers not the president himself but mr. trump has said he is thinking about february 1. without question, mr. trump is using tariffs as an effective negotiations tool, the question is, what will the president's tariffs strategy be? looks like mexico is cooperating on the border. unfortunately, canada at the moment is leaderless, i don't think that mr. trump will break y up usmca,

trade dale, changes in the deem are likely to be possible. the dang players they arey administration players are not in place yet, the time is short to make that decision by saturday. similarly, the president is said he note ready for a universal tariff, quite yet, for my part, i rather like universal tariff. i likes numbers. roughly 5 trillion dollars in imports. and 10% rate, could yield roughly 500 billion in revenues to finance tax cuts. and i think at least 50% if note more of the cost of those tariffs, will be borne by the exportses countries. hence there will be no more than a slight possible one how faoff price

impact. mr. trump's past custom has been bilateral negotiations, he applies principle of reciprocity, if you tax us we'll tax you, this since mr. trump is very much a free trader who would like to see significantly lower tariffs, and lower nontariff barriers and less government subsidies worldwide. now many on wall street are crazed about the idea of tariffs but they should not be. world s's trading system has been broken for a long time, p president trump is aiming tariffs at china but he has said he will talk with xi jinping first, china tariff morse than twice as -- more than twice as high as america's. brazil and india, nearly 5 times, and world trades

organization does nothing about all this that is why i think that mr. trump is right to play an america first strategy. but knowing him as i did, no one should be surprised if he keeps us all guessing until he strikes. make no mistake, no mistake about it, president trump knows how to use this tariff weapon. that is the subject of the riff. okay. great pleasure joining us now for an exclusive interview my dear friend kevin hassett, brand-new director of national economy counsel, congratulations to you. >> thanks. it is an honor to be back in your office. larry: yes, it is. a lot of people -- a lot of distinguished people had that job. kevin, let me ask what i lod

oi -- lot of people are asking, you are a key player, how do you see president trump's tariffs strategy? all over the front page. what do you think? >> right, i think that you saw from the colombia negotiations that president is going to use tariffs if he needs to, to get people to make policy concessions that are good for america. that make put america first. but, thing you need continued to when you look at the -- need to understand looking at president's actions that whatever tariff comes from someone who does something like stops us from sending planes to colombia, to get rid of criminals they sense here, whatever tariff ta -- tariff it might be would be in addition to what trump does in future, when he thinks about overall tariff, bottom line, a tariff is not necessarily just a weapon but economically do y do

the math it can be a supply side strategy. you can have really great supply side reform to american taxes, by putting tariffs, combining tariffs with a smart reform to tax system. larry: you know, i like the numbers, at least the ballpark numbers, roughly 5 trillion dollars of imparts on a -- imports on a yearly basis, if you have 10%, depending on the sensitivities of the demand and so oyou could produce 500 billion dollars worth of revenues which could then go to finance tax cuts, i like that approach. it has just enough william mckinley in it to make it sexy, i think, president is a big follower of william mckinley here, is right to

say 1870 to 1913 we did not have a civil -- income tax, we used tariff revenues to finances government, it has the slight feel, slight mckinley file, what -- i don't think you knew william mckinley. >> you went to college with him if i recall. larry: i was a young research assistant for teddy roosevelt later on, but, i am sure revenue implications with respect to tax cuts has something to do with mr. trump's thinking? >> yes for sure. and the bottom line again, is that when the people who are trying to cause panic over president trump's trade policy, you know simulate what it will do, they don't account for all other policies, president trump is drill, baby, drill, and deregulation and tax cuts, and reduce spending. you know forget the fact if

you say economy would be better if we don't do anything, say democrats, they are spending 1.5 trillion a year more than when we left office, we have these to fix. if you look at tariffs, as part of after overall strastraining strategy, you will see a golden age. larry: wall street is somewhat crazed about tariffs. you read routinely, every news story has a paragraph or two but how they will be inflationary is wall street wrong kevin has snet. hassett? >> everyone has been saying it for last year and goldman sachs thing said that harris a policies would be better, let's look at this, if you spend 1.5 trillion a year more on government spending you get inflation. if you don't let people drill, baby, drill, then energy prices go up you get inflation, if you do, as biden did over last couple years kill 130 million

chickens then egg prices will go up. the fact is that we're doing microthings correctly, deregulatory things correctly we'll get macro stuff right too, but, make no mistake, inflation under joe biden was just under 5% for his whole term. about little bit less than it was under jimmy carter, and way more than double under president trump. and we're 100% on the ball going after inflation, it will require all of the above approach. and right now we have inherited high inflation, still 50% higher than it was when we left office, president trump for sure, will go after this stuff. and we'll do it with all of the above, idea that tariffs will be inflationary without looking at everything el that is inflationary for price of eggs if you kill 130 million chickens, guys, come on. larry: a "wall street journal" story that american morning. that said trump advisers, quote, unquotes, done name

them directly. say that he is close to deciding on 25 percent hike on tariffs for mexico and canada that would throw a monkey wrench to usmca . >> president trump is 100% committed to getting fentanyl imports to u.s. under control, it is pouring in across borders of canada and mexico he is very serious about it, that is all i can say right now. larry: i get it tax strategy will i get my one big beautiful bill? >> that is a great thing about u president trump leadership here, is negotiating with congress right now, i know what he wants cwants. one big beautiful bill, that is pretty much what happens, we were there in previous trump administration, that pretty much every time he said i'll this or that, you get what he wants, i

remember one difference i remember he wanted 15% corporate rate, and then we got 20 in the end, he can compromise if he has, to most of the time he gets what he wants. larry: he might get his 15. >> i'm just putting that number out there. he had 15 in the brain for a long time. larry: what about idea, senator crapo's idea, not just his idea, but others, to use a current policy baseline. the tax cuts popular and should be made permanent. that as obama used to back in 2012, the current policy baseline said nothing has changed therefore they should not have to be rescored. is that social easing around the house? i think that senator crapo has talked to president trump about it. >> sure, president trump is 100% aware of baseline

strategy and he respects that people in congress have to decide how they want to negotiate baselines among themselves, and president trump cares about what is the truth, what are numbers, you know how is this helping american workers if we do this or that. how to we get spending under control, and he understands the negotiations, but i think in the end he really wants to talk about when we talk to him what is truth, what are things. i i'm sure we could defer to those folks, you are 100% right that the bottom line is that if you spend a dollar you pit will do -- put tha dollar in baseline m forever. we're 100% aware of, that in the en we have incredible friendship with senator crapo, what they decide to do with baseline depends on parliamentary say, and what

we care about in white house how it helps america's workers and truth is in the numbers not what the cbo said baseline should be. larry: kevin hassett, what -- give us a quick smal snap shot of the economy. >> you know, the big thing is that you know a lot of news on artificial intelligence today, that there is you know some good tailwind from artificial intelligence increases productivity, but sat same time reckless men -- spending of biden administration created a problem with inflation, i am in a place we see more stuff to fix than stuff i'm happy about. larry: i noticed last point, it is hard to figure out right now at beginning of process. but, a number circulating among house chairs and so forth, attackeret 2 to 3 --

a target 2 to 3 trillion of spending, savings or reductions over 10 years, do you think they are good ballpark numbers should markets think about 2 or 3 billion dollar spending savings over next 10 years. >> un, one of the really fun things of last week, such an honor to serve my country again here, is to walk around and see the -- the doge people, the great ideas that people have, i think that we don't have a number right now, of what overall target will be but we been stunned by waste with biden administration, there is a heck of a lot for our team to fix. larry: kevin hassett, congratulations. >> thank you, larry. larry: all right, coming up next, steve moore, and arts

laffer will react to kevin hassett's first interview as necdirector in white house. >> you can catch kudlow monday through friday 4 p.m. here on fabulous fox business. and if you can't get us at 4, for heaven's sake text your favorite 9-year-old and she will show you how to dvr the show, and you will never miss a tax cut or a tariff or a spending increase or whatever. i'm kudlow, we'll be right back. (vo) memory and thinking issues keep piling up? it may seem like normal aging but could be due to a buildup of amyloid plaques in the brain. the sooner you talk to your doctor, the more options you may have.

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larry: here to weigh in on what kevin hassett said, joining us now, art laffer, former ace reagan economist, steve moore, host of moore money. and both of these guys, wrote a book together, the trump economic miracle. i didn't say it was a literary book. steve moore, you heard our friend kevin hassett, don't pull any punches, what do you think? >> well, larry those are big shoes he has to fill. you did such an amazing job as trump's national economic counsel ad adviser first

term we have been kevin for a long time here, is a suburb economist, i agreed with almost everything he just said, what is being presented here. it -- i will call it new trump trade doctrine. that is we will use american power and might to get countries to do things that are america's interest. they are not unreasonable demands, yes, colombia should take back the criminal aliens, yes mexico and canada should help america keep the deadly drugs out of u.s. and europeans should pay their share of defense allotments, i think he will prevail in the next 6 to 9 months just as he prevailed against -- how long was that threat of the tariff in place? two hours? colombia, said okay we'll cooperate. larry: you know he told the guy to go pound sand, and

threatened to destroy his economy is 25%, then 50% tariff rates. and you are right. art, interesting generic point. you, me, steve moore, lets add kevin has it and others, 10 year -- hassett and others, 10 years ago, 12 or 15 years ago we were free traders, i'm not saying we're not free traders, in many ways mr. trump would like a free trade situation with reciprocity, we have moved today use of tariffs to move toward free trade reciprocity or a matter of national security. there is no question the world has changed. the republican party has changed.

arthur and we have changed. >> pl president trump first term was well aware of negotiating ability of tariffs, deals he got were freer trade, usmca, and japan and south korea and brazil. when you look at this, by way kevin is amazingly well qualified to be your replacement, he is a d data driven guy, i like him, you look at it here, there are several reasons why you want to use trade to get other objectives. number one, prior to 1913, tariffs were a major source of revenue are in federal government. when you look at the numbers if you do use a tariff across the board flat tariff, you can use that to cut income taxes as you said, you can. you can see how it works well with colombia, we'll not have to raise tariffs to

colombia to get to do what we want, they will do it, there will still won't be tariffs, the threat of tariffs is a big deal, i am wages for panama -- i am waiting for panama to hear it and trudeau squeal and sheinbaum come back, saying we'll stop all of the illegals coming in ex and remember mckinley is from northeastern ohio. >> i -- >> trump is a master at this. larry: the thing, say it to you both. but steve's turn. i made the case 4 years when i was in there, a couple op-ed pieces because of his belief in -- reciprocity mr. trump

believes in free trade, h he would like a world of lower tariffs, and much less government subsidies steve moore that still, his view. i don't think anyone ever gives him credit but he says to get from here to there, we'll have to wield the stick of tariffs. you know that say different view than the one we might have had 10 or 15 years ago but it is good, steve moore. the tax bill still very much up in the air, and spending side is very much up in the air, steve. >> we have to get this tax cut done right away, trump has voter mandate to do it, average taxpayer am pay 3 thousand dollar tax increase if it does not get done, you made that point week after week longer we wait, the more risk that does not get done. more it will hurt the economy, first 100 days or

150, i am with trump he has to have a bill to sign by memorial day. larry: i hope that doral conference comes out with one big beautiful bill. at least extend the existing tax cuts. extend them get that all out of the way. >> yes. larry: beyond that perhaps. >> he should be able to negotiate aid in the bill. larry: aid, wild. >> to california for sure. >> assistant, that may be. i am sorry, i did not understand that is right. >> you know we need the votes, they need the bill. >> there are car ca cacarrots and sticks i agree. >> coming up president trump suggests sending irs agencies to help down at border. here, what i didn't wasn't, i first heard, irs agency may be packing heavy metal, they are not just accountants, they are

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larry: house is meeting with president trump this afternoon at doral golf club in miami, the question is will there be one big beautiful bill who would stop it, we talk about it with rich lowry, and jason chaffetz. former utah congressman and fox news critter. just to -- contributor, jason, you know house. the freedom caucus membership of them, don't really care about the tax cuts. they want you know, tough spending cuts. many, many others in middle of house republican

conference they love to cut taxes. but they are not that kean on cutting spending. and we don't seem to have yet what -- on wall street sometime called a matched book. i just wonder, this conference may or may not solve that stuff, and president trump -- i think has to take big leadership position here. >> the one thing that is out there that is true, across all of them is they are fearful of donald trump. you don't want to be on the wrong side. he will be one to pull this together, in congress, he had less than half of group of house republicans that were fiscal conservatives, a group that does not' to cut spending a group that doesn't and a group that does not care about tax policy then salt group from north east that want to increase the threshold on the state and local taxes. it is by far, then you have

a couple of people out there that libertarians like the massies, you don't know why they are coming from, you have one or two votes to give. larry: moment i'm not going there. >> that is a problem. larry: it could be a problem. psychological or emotional, it will be political. put yourself in the president's shoes, what should he tell this conference, i believe it is at 5:00 this afternoon, i could be wrong. but what should he do? he has to make a call? at some point. >> yes, well, i thought you have been right about one big beautiful bill, hard enough do it once, twice will be difficult, so matter what is solved, quote, unquote, it will be unsolved at some point, and you will reiterate the process, usually this works a president has bipartisan bill, to keep it going while reconciliation bill getting worked on, george w. bush

did that, nothing much will happen. you have a lot of bored reporters focusing this, it will end in success but 2:00 a.m. in morning president trump on the phone, phone getting passed to various ccongressmen to wrangle last vote or two. larry: they have to get it done, they neat the border money -- they need border money i'm fine with that, drill, baby, drill, if they much about the codify regulations on drill, baby, drill, and liquid gold i'm okay with that but the essence of it, it is a recon bill -- reconciliation bill your tax cuts and spending cuts, and i'll tell you what e-- el idea of current policy baseline, what obama used that means if you have a popular permanent tax cut, do you not have to rescore

it every year. like all democratic spending stuff. that is what senator crapo raised, a lot of people are on to. >> that. >> scoring will be an issue, that is why you bump into debt ceiling issue, we have to revisit tax cuts again. because how -- just wrong this cbo is in how they score these things. they don't look at the dynamic scores that happens by you lower taxes, revenue through treasurys go up they don't -- recognize that. there are a lot of people in republican conference that don't understand it. larry: speaking of revenues rich, i have newfound respect when i just learned over weekend that irs agents pack guns, i thought they were a bunch of thick-glassed accountants, now i know they are packing i think that trump is right

in sending them to the border all 88 thousand of them, i have new report for them. >> if we tax people coming in margin rate is high enough. larry: why note they are packing gun -- why not, let them do the lord's work instead of runnings after waitresses and waiters and uber drivers. >> under lining a point that jason made everyone is afraid of trump. there is a concept called you make someone so afraid of what you do to them they do what you want, we saw it in colombia, we see it in the world, i think and also at play here dommist like. >> he made them pound sand in colombia, saying i'll shut down your economy. >> i like that -- >> can i talk about irs, this is -- >> the gun packing irs. >> if you are a border patrol agent, you don't want them to have your 6, they have taken thousands of

border patrol agents and havehave -- them d doing paper work, let irs agency do administrative things so people who are trained on border can do apprehension as opposed, to i think there is a lot more validity to this. >> same thing will happen with military, military not directly making arrests but driving humvees and whatever you need to free up resources. larry: a good thing. >> jason chaffetz would you till us -- t tell us 17 inspector general federal agency released,. you were oversight chair. i hope do you bet or this than 225 alphabet. >> i have an issue there. that you fostered. >> that i fostered. larry: should, can president trump get rid of these

ig 's. >> he should, not everyone across board, you know there are good ones and bad, he got rid of those he should, to inspectors general, presidenta appoint 36, they could stay in per c tpethere are good ones. >> he didn't do 30 day warning. he has to fire them again. >> 30 day notice. >> a 30 day note g notice. >> just what high he wants to fire them. >> thank you. >> you can catch jason, a lot, co-hosting "the bottom line" tonight with dagen mcdowell, 6 p.m. eastern. right here on fabulous fox business. and you can catch rich lowry at national review and new york post any old time you want. coming up, cia admits covid likely came from the wuhan

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>> cia has assessed that host likely cause of this pandemic that has raut so much devastation in world is because of a lab related incidents in we wuhan, important to see cia get off sidelines and be truthful about what our intelligence shows. >> john ratcliffe, joining us now talk about this welcome back iowa senator joni ernst. as always, welcome. great to see you. so this is the pretty big deal, just saying that prob bill fi was coffee cove started in -- probability that cove st covid started in wuhan lab, a lot of destruction in world, and repreand government censorship, and a

lot of people said this is -- this is of an important thing. i don't know, i think a great start for ratcliffe, but a lot of people, can say, i told you so. >> well, i will say i told you so. we have known this from the very beginning. and i have been preaching this for now years. and i do want to thank director ratcliffe for being forward -- leaning telling american people what cian knows and confirming what many of us have believed, why is it important? you are right. so many lives were affected, not just u.s. but the globe attack payers have -- taxpayers invested in this we had government dollars flowing to the wuhan laboratory in china.

we have seen the dollars to risky experimenttation, who knows what pandemic could be funded next if we're not providing the proper oversight, i would say whole of government mistake now corrected, because truth can be released n we can do something about it. i'm with you. i am glad that we're doing this. let's get the cia to a point where they are acknowledging yes, the virus started in china outside of this lab, and now, we have put preventive measures in place. larry: to -- senator, two follow-ups do we know with certainty that money has been cut off? because fauci was not honest about any of this? do we know that. >> i would say, that no, we don't. however a number of my efforts have cut off that

funding, but we continue to find out other avenues of grants that continue to go to the wuhan lab to china to our adversary's pockets even at dod we were able to go down a rabbit hole and find in recent years they are still funding activities in wuhan we had to go in directly cut that off, there could be other activities that we're unaware of. that is why we have to be initialed. l-- engaged. larry: other thing, ma'am biden administration exercised hard-core censorship, if anyone disagreed with their point of view. you are aware that president

will sign bills today, reinstating military service members who were discharged over the covid vaccine mandate, and they will be reinstated with back pay. these worth -- among the most egregious things that biden people did in my equipment. -- judgment. >> absolutely, what we saw past 4 year was biden propaganda machine talk about state-run media this was state run media. they controlled the message, it didn't matter what the topic was, they controlled, they were those that went out and censured conservative voices and opinion its ended with trump. larry: senator joni ernst thank you, ma'am, appreciate you. talk soon. >> i'll be right back with my last word. lidate bad debt and save money for your next goal. take a swing at your kitchen reno...

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larry: that's it for kudlow, thanks for watching, folks.