that's it for "special report," fair, balanced, andna >> "the o'reilly factor" is on, tonight: >> i was falsely accused while i was national restaurant association. >> republic presidential candidate herman cain says he is being smeared by the mainstream media. karl rove will weigh in on the political fallout. >> you get the sense with mitt romney if he thought it was good to say the sky was green and grass was blue to win an election he would say it. >> the obama campaign rachts up attacks on mitt romney and it's getting personal. >> he has no core. >> is the president afraid to face off against romney? we have an inside look. >> tax the 1%. tax the 1%. [chanting] >> whose house?

our house. >> occupy wall street continues around the country. as arrests and costs continue to rise, how is the media covering the protesters? bernie goldberg will tell us. >> this is ridiculous. >> caution, you are about to enter the no spin zone, the factor begins right now. captions by closed captioning services >> hi, i'm monica crowley in tonight for bill o'reilly. thank you so much for watching us on this halloween evening. bill is off tonight. we think he is trick or treating so if you see him, you better make sure to give him some good treats or else. now, for the top story. with the iowa caucuses just two months away, candidates spent the weekend laying out their case to the voters. surprisingly, most polls show it is now a two-man race between mitt romney and herman cain. today herman cain was defending himself from new allegations. a new report says two women

accused republic presidential candidate herman cain of inappropriate behavior while he was the head of the national restaurant association in the 1990s. cain responded to the charges this morning. >> yes, i was falsely accused while i was at the national restaurant association. and i say falsely because it turned out, after the investigation, to be baseless. >> joining us now from austin, former senior advisor to president george w. bush and fox news contributor karl rove. great to see you, carl. thank you. >> thank you, mondayca. >> so we know that every presidential campaign needs a great grand strategist. a great pollster, and a great crisis manager. when you look at what's happening now to the herman cain campaign. how do you think they have handled this so far? >> well, until today not well. when it broke over the weekend their first response to say this is a smear by the mainstream media to which there is no basis. then it was they didn't know

whether or not he had been accused and then today he came out and said rather forth rightly, i knew about it, different what he said yesterday. i knew about it and i was falsely accused and nothing happened. unfortunately we're now at a point where people are going -- then he pointed people towards the national restaurant association and said you have got to go talk to them what's going to happen is a demand for the national restaurant association to release the results of the investigation that was done to make public any details about any arrangements if any that were made with the two women whom politico says got settlements in return for a agreeing to leave the organization. >> hey, karl, do you think herman cain should be prepared for more of this because is he a black conservative? >> no. i think he should be prepared for things like this because he is a serious presidential candidate. in fact, what gets me is that, look, i have talked to people in the news biz today and they said

this has been going around for at least 10 days. i find it hard to believe the campaign didn't know that this was coming and was badly as prepared as they were. you don't start off by saying there is nothing to this whatsoever and then go into well, we don't know anything about it and then yes, i know it but i didn't do it. i mean, that's -- you would rather be where you are gonna be at the beginning rather than be drawn there by the events. a and as we say right now he has got a good answer which was "i was falsely accused. there is nothing to this." that's going to require then for the national restaurant association in all likelihood to respond to the media by laying out the details of what actually happened and what they actually did about these charges. >> i wonder if this could back fire. do you think, carl, that most voters are so fed up with political correctness and attack politics and character assassination that this could actually have a rallying effect to herman cain? >> if things turn out to be, that he -- he was falsely accused, and that nothing happened, yes.

this could boomerang and work to his ad vantage. but, look, we are in a place where the president of the united states, particularly after the events of the 1990s, we want our presidents to be as far above reproach as possible. these are serious allegations. politico. backed up by a number of people who talked about the two women in question. and now the question is going to be how does it get put to bed in a way that gives confidence to the american people that it is as herman cain said, "says it was. nothing there. and nothing to be worried about? >> all right, karl, i want to switch gears and get to president obama's re-election effort. his chief campaign strategist david plouffe said this about mitt romney yesterday. >> he has no core. look at issue after issue after issue. moved all over the place. can i tell you one thing, working a few steps down from the president. what you need in that office conviction. you need to have a true compass. and you have got to be willing

to make tough calls. you get the sense with mitt romney if he thought he -- it was good to say the sky was green and grass was blue to win an election he would say it. >> david axelrod, obama's chief political strategist used the same exact phraseology that mitt romney has no core. what do you make of that line of attack, karl. >> first of all i don't think it's smart on the part of owe bottom that campaign what they are snaggle the guy they are afraid of is romney. this is laughable. senator obama ran a campaign ad called government run health care extreme and came into office and passed obama care. they attacked the debt under george w. bush as being too big and then came in and have run up deficits, annual deficits that are 10 times as large. they for closing gitmo and now for keeping open. against military tribunals now for military tribunals. they said we shouldn't raise

taxes in a recession. now trying to raise taxes. never raise taxes on people that make less than $250,000 a year. obama care they raise taxes on anybody in america who buys an insurance policy. anybody who goes to apt. who anybody who buys drugs. anybody who uses a medical device and every college kid who gets a guaranteed federal student loan pace more because of obama care. a lot of people make less than $250,000 a year who fell into every one of those categories and i could keep going. voted 12 times present on things like partial birth abortion and concealed handguns and whether or not there ought to be strip clubs within 1,000 feet of schools. he couldn't bring himself to figure out where he stood on issue that. united states senate he voted 315 times -- he didn't vote 315 times on major issues. so, please, mr. plouffe, mr. axelrod, president obama, don't be lecturing us about convictions. please don't. >> he they are already running a general election campaign against mitt romney. >> sure they are. >> is that smart of them at this

point? not a single republic voter has voted yet, right? >> yeah. i don't think it's smart on their part. first of all, it elevates romney. second of all it diminishes obama. president obama is the president. why the heck is he trying to interfere in the republic presidential sweepstakes. he should be being president. not political attack dog. not campaigner and chief. not a frequent flier rider on his presidential bus in battleground states. he ought to be the president trying to be the president rather than trying to elongate the presidential campaign and get his presidential jollies in. this is sad. the president and his people are making a mistake. i say as a conservative, as a republic, go ahead and make the mistake but as an analyst i say what the heck are you guys doing? >> tells you how afraid they are, frankly. of any republic candidate but certainly of mitt romney. karl, great to see you. thank you. coming up next, brand new polling out of iowa. we will tell you who is up and who is down in the all important hawkeye state. and later violence, chaos, and more arrests from the occupy

protesters, why are some in the mainstream media glorifying the movement. bernie goldberg will analyze.

>> in the impact segment tonight, herman cain continues to hold the lead in the republic field in iowa. the latest des moines register poll of likely republic caucus goers has herman cain at 23%.

mitt romney 22%. ron paul 12% and the rest of the candidates are in single digits. joining us now from washington is fox news senior political analyst brit hume. great to see you, brit. >> thanks, monica. thanks for having me. >> you bet. you know what's interesting to me about this iowa poll is neither herman cain or mitt romney have spent a great deal of time of money in iowa, yet, they are leading the pack. how do you explain it. >> i would explain that by the fact that about all there has been to this campaign has been the debates. and that for all that you may accomplish eventually in a state like iowa or in new hampshire by retail campaigning that is going out and shaking hands and appearing at, you know, relatively small events, you can't beat the size of the audience given the intensity of interest that you get with the debates. that's really been the substance of the campaign so far. and both romney and cain, it seems to me have done reasonably well. romney hasn't done as well as i suppose he would like and case

number might say that as well. that's how i would explain it. >> it's interesting, brit, because over the past many decades, voters in iowa really value the personal touch. they want to meet and greet these candidates. they want to spend time with them. they want to talk to them in their living rooms. yet it seems this, perhaps, is the first presidential election season where we have seen the race so nationalized so fast. >> i think that's a good point. and it's not clear to me, monica, when it gets down to it, and we get closer to the final weeks, the very final weeks before the voting begins in iowa. it looks like it's going to be earlier than ever this year. that voters will not expect to see more of these candidates and will not, you know, make choices in part based on what they think of them when they see them face to face. romney of course is a familiar figure in iowa. he has never emphasized the state this season. last time out he emphasized it a lot and didn't do all that well. he is working to keep expectations low. cain is another matter. he has barely gone there and a lot of people love him. there is a reason for that, too.

but i, you know, i think retail campaigning will become more important in the final weeks. >> what do you make of some of the other candidates, brit, who have, in fact, spent a good deal of time and resources in iowa. i think of michele bachmann in particular who was born in that state. real affinity for the state and voters for her. also newt gingrich coming up here behind you. he is experiencing something of a surge nationwide and also in the state of iowa. do you think think there is room for a third candidate, that might be an alternative to either cain or romney? is there room for a candidate to sort of come up the middle and grab this thing? >> well, prachings, what i really think is the position that cain holds in the race has been held before him by several others including for period of time michele bachmann and before that donald trump had a run up in the polls. the conservative base of the republic party is restless and looking for an alternative to mitt romney who they don't really think is one of them. and that, they have sort of

elated in a serial fashion one candidate and then the other. my sense is that someone else may be eligible if cain falters. who knows, he may, his campaign maybe a bit mistake prone. he may falter. when he does someone else may emerge. newt gingrich would have a chance of picking up some of that vote and will be the romney alternative for a period of time. i'm not sure how all of this is going to play out. rick perry, of course, is trying to relaunch his campaign. he has got a couple of issues he is running on now. at first he wasn't really running on much of anything except his perriness. now he has got a couple of planks that he is trying to run on they have some appeal to the republic electorate. whether he gets a second chance to make a first impression is something we will soon find out. >> that's exceedingly difficult to do in this era of 24 hour news. you get one shot of making a

first impression but we will see. rick perry was on with chris wallace yesterday. i thought he was very impressive on "fox news sunday." so we have to see. brit, looking at all of these polls, state by state and also the national polls, i have noticed that mitt romney is in the low 20's and doesn't seem to have a lot of momentum, either one way or the other. he is sort of stuck there. he has hit a ceiling. do you think that he is confident that he can lock up this nomination early in this process or do you think he might be nervous about an insurgent candidacy like herman cain or michele bachmann or newt gingrich or even rick per j? >> i think he is well aware that he is not really trusted by the conservative base of the republic party. and that he is simply trying to be the last person standing when all is said and done. the party has a history of nominating people who are not as conservative as the party might really like. but they settings on eventually. you saw that in the case of dole. you saw that in the case of mccain. we have seen this before.

romney has always struck me as a man trying to build an ark. tremendous amount of money, national organization. i think his hope is that he can stay in this, he can weather the storms. he expects there will be some storms. he will still be there when other candidates have run out of money or otherwise faded away. at that point it becomes important, which candidate is the favorite second choice? and there haven't been many points on that monica but there is a few. romney commands about 40% of that vote. how available that vote is to him depends who else remains in the race. if some of these conservatives fall by the wayside for whatever reason, you know, you put that most of that 40% together with the 25% or so that he holds, he has got a distinct majority and he could certainly win the nomination race based on that. >> well, it's all very interesting, these polls, brit, show us a distinct snapshot in time but not a single republic voter has voted yet. >> good point. >> the voters have yet to speak. brit hume, great to see you as

always. thank you. >> thanks, monica. >> rick perry says he is a doer not a talker. >> newt gingrich gaining momentum in presidential bid. he will be here to tell us his plan to win the nomination.

>> in the unresolved problem segment tonight, texas governor rick perry continues to struggle in iowa caucus polling. this morning he released a new ad in that state positioning himself as a doer, not a talker. >> if you are looking for a slick politician or guy with great teleprompter skills. we already have that and he is destroying our economy. i'm a doer not a talker. >> in texas we created 40% of the new jobs in the country since june of 2009. we cut a record $15 million from

our state budget. they say we can't do that in washington. well, they are wrong. and they need to go. >> joining us now from washington, fox news analyst mary katharine ham and juan williams. great to see both of you guys. thank you for being here. mary katharine let me start with you. he is trying to create a second impression with the american voters because after his shaky debate performances his poll numbers sliding. he had some shaky performances in the debates and now he is pulling up the rear. what he is trying to do is make a second impression on voters. he is out there in the ad no tie on. sort of casual rick perry. what do you make? is it possible to regroup, regain your sea legs and relaunch your campaign? >> if you look at the des moines register poll likely caucus goers from iowa his numbers are down pretty low. i think you are never in a great

position when you concede you are not great at something. he is trying to move on from that maybe he has conceded that one too many times or talked about it one too many times. banking on the fact that one conservative voters are sick of a showy speaker like obama and from us stated with -- instruments frustrated with a guy like romney. he has stuff that he has done, not talked about, that are impressive. i think that second part is really true. the irony is that his inability to talk about the impressive things he has done in texas with jobs that kind of thing kept talking about what he has done. sometimes in the game of politics you have to be able to talk. he is trying to do it with this ad. chance he can bring up his numbers. it's going to take a lot of retail politicking. >> juan, it's interesting because for a while when he was leading the pack other conservatives and republicans were looking at him as the probable conservative alternative to mitt romney

because let's face it a lot of conservatives just don't trust mitt romney. and, yet, because he is sort of blown the debates, he has lost that position now to herman cain so can he? i you the same question i asked mary katharine can he relaunch campaign and gain momentum and position himself as alternative candidate. >> he has $15 million on hand and that's the second largest amount of any republic right now, monica, so he is going to have an opportunity but, remember, just last week he put out his tax reform plan as an alternative to herman cain's 999 plan. rick perry got no traction whatsoever for his tax reform effort. people were mocking and questioning enough revenue to get out of debt situation we are in. i think this ad really is a desperation move. a lot like a guy who can't get a date. let's say it's halloween or whatever and can't get a date you say to the girl you know

what you? are missing out on the biggest thing in your life. other girls down in texas, they think i did a great job. well, that's not going to work. especially after, remember, rick perry insulted so many of the tea party folks and conservatives on the immigration issue so right now in iowa as mary katharine was pointing out, he is not just behind mitt romney and herman cain. is he behind ron paul and behind michele bachmann. he is down there and it's going to be very hard to revive his fortune unless something like the sexual harassment complaints against herman cain or something knocks up, you know, shakes up the field, monica. it's going to take other people flipping to give him the chance to reposition himself. i think otherwise he is on the edge of oblivion. >> mary katharine when you look at rick perry's campaign so far, one of the reasons he gained so much traction early on is because he does have an incredible economic success story in texas to tell yet, he

sort of seems to constantly step on his own message whether it was highlighting immigration, which alienated a lot of conservatives or then over the last week when he was launching this flat tax pro-growth economic proposal, which he should have been touting, he sort of made a comment about the birther movement and so on. he just seemed to not be able to get out of his own way. >> like juan said i think both herman cain and rick perry's tax plans took some heat. bold and changes to the status quo. they will take a lot of heat. the difference was that herman cain stayed on message and kept talking about 999 and rick perry actually did step on himself. if is he a doer, not a talker, he needs to talk about the things he will do and the things he has done. there is a lot of compelling stuff to talk about. he does have a competent organization and some money on hand. and getting that message discipline back which i have seen them have in texas and they have been very impressive with it, that's going to be the important thing. i have been surprised in debates, circling back to the

jobs record in texas is the number one thing he has to do in almost any answer. i think it can be done but he has lost a lot of ground. >> agreed. >> folks really like cain. the one thing i will note. the pro-life mini controversy with cain may or may not knock off a few points with folks as that trickles down in the knowledge base with iowa. i'm not sure. >> just a quick yes or no from both of you, will we see rick perry engaged in more republic debates, mary katharine? >> yeah. i think he will be out there. that was another thing that sort of stepped on his own message last week. he will be engaging. >> juan, yes or no. >> yes. he has got to do it. gone back on his pledge. going to start avoiding debates. if he got such a negative response that, again, he finds himself in a situation where he is hurting his own campaign. he just is not good at this. it looks like his wife is driving the campaign and not him, monica. >> he was very impressive on "fox news sunday," yesterday. i want to see more of that rick perry. >> hopefully. >> i have got to run.

thank you, guys. >> do we need 26 debates? >> that's another subject for another day. mary katharine and juan, thank you so much. plenty more ahead as the factor moves along this evening. newt gingrich in the no spin zone, the speaker will be here to tell us how he plans to enter the top tier of presidential candidates. and bernie goldberg on how the media is covering the increasingly violent wall street protests. we hope you stay tuned to those reports.

>> in the personal story segment tonight, newt gingrich is beginning to gain some momentum after his campaign struggled to get off the ground in the spring and early summer. but the iowa caucus now just two months away, is there enough time to overcome the slow start? joining us from washington is the former speaker of the house and republic presidential candidate newt gingrich. mr. speaker, welcome. >> monica, it's great to be with you again. >> great to have you here. so i am looking at these polls and you are enjoying something of a surge. to what do you attribute that

uptick. part is substance and real solutions people who have gone to my site newt.org. real solutions to creating jobs. people who look at track record are ronald reagan. speaker working with president bill clinton we brought unemployment down to 4.2%. they look at 4.2% today they think that would be a much better america than where we are right now there are folks who want to rebuild america and i think they look at what i'm doing as a very, very good step in the direction of rebuilding the country that we love. >> i think you be absolutely right on the substance, mr. speaker. i will posit something else. now that we are run year away from the presidential election. a lot of conservatives and republic voters are looking at this field and they are trying to visualize the first presidential debate. and what they are seeing is that you are the smartest guy in the room. you are such a serious

conservative intellectual. out of all of the candidates you are probably the only one who could make mince meat out of president obama in any of those debates. that visualization is giving you a strong bump. do you agree. >> i have been telling audiences, monica, that i am committed to challenging president obama to seven lincoln douglas style debates, three hours long each with a time keeper but no moderator. i would be will to have the president use a teleprompter if he needed it audiences find the idea of obama and me having serious debates not game show question and answer 30 seconds here, 60 seconds there. but two adults really talking about how different our vision of america is. i want us to rebuild the kind of america that most americans love. very radically different vision of america's future. those could be among the most historic that we ever had as a country rivalling lincoln douglas as a definition of where we are going as a country.

>> let's talk a little bit about the substance of what you put forward because you have advanced a flat tax hong kong years has had optional flat tax. you will could keep your current tax codes, all the complexities and reporting. pay your cpa or your accountant or tax lawyer or fill out a very short simple form. this is how much you earned. this is $12 apiece for every member of your family as deduction. home mortgage and charities. here is the amount that you owe. in hong kong it's worked very, very well. we think by controlling government spending we could set a rate of about 15%. we combine that with those who stay in the regular tax code, we gold to zero capital gains tax to bring hundreds of billions of dollars into the u.s. to create jobs. 100% expensing to write off all new equipment for farmers, businesses, doctors, every kind of investment in new equipment.

we would also abolish the death tax permanently so that family farms and family businesses could focus on job creation not tax avoidance and finally, we would have a 12.5% corporate tax rate the same as ireland so that american companies could bring home at least $700 billion of the profits that are locked up overseas. we think that package, combined with very strong regulatory reform and a real commitment to american energy would get us back on the growth track towards 4% unemployment and that's the key first step towards balancing the federal budget. >> i do like the fact that you are family sizing the pro-growth policies, mr. speaker, because we talked a lot on the republic side about the need to cut spending and it's absolutely crucial. but the other part of the equation is pro-growth to get this economy going and you are really focused on that. let me ask you about your campaign because you said over the last few days, i think it was in iowa you said i'm going to need your help because i don't have the money or the or the momentum of the other guys. you do have uptick in the polls

now. you are looking for real grass roots movement, how are you going to maximize the momentum you are enjoying now to position yourself as the conservative alternative to romney. >> i will be in des moines friday night. we were working iowa very aggressively and trying to reach out to everybody that we can. i think that there is a real feeling that people do want to be with me and getting america and rebuilding america and getting us back to the kind of cousin tri that we love and we want to be. at the same time i would say to you that we have had the best months we have had in this campaign. we raised more money in october than we did in july, august, september and about half of june combined. so i'm a little bit encouraged. i'm not going to raise the kind of money mitt romney can raise. he raised a million dollars on wall street alone. the question is can we find enough volunteers and can we use social media, facebook, the internet, bitter in order to compete with him. i think we can. i think we will be very, very

competitive in iowa. >> okay. mr. speaker, we are going to be watching your campaign very closely. nice to see you. >> thank you. >> bernie goldberg on why the media continues to glorify the increasingly violent occupy wall street protests. what do you think the richest man in america says about taxing the rich?

>> thank you for staying with us. i'm monica crowley in tonight for bill o'reilly. in the weekdays with bernie segment tonight occupy wall street protests continue this weekend as more and more demonstrators were arrested. a rally in denver became violent and 20 people were arrested after the protesters defied police orders over where they could build their sleeping tents. despite the violent nature of some of these protests, the media seemed to glorify the movement. >> what's the civics lesson in

this for our kids as they are watching this on tv. >> there is a huge civics lesson. it teaches what is important about this, what are -- i think you have to ask the questions what are they there for? what are the reasons behind this? the idea of having a civil discourse is important to teach our kids and something in history we have seen. >> this protest movement is showing strength. it's still growing. changing, and spreading. >> some people are unemployed. they are students who can't pay back student loans. people who need health insurance. but what union nights them is a frustration even anger over an economic system they sees a stacked against them. >> joining us now from miami, the purveyor of bernard goldberg.com. mr. goldberg. here we have the very rich irony of major network news anchors and hosts and reporters making a gazillion dollars a year empathizing with occupy wall street. do you think there is anything -- anything to this apart from pure left wing

ideological affinity? >> well, let's put it this way, monica. there is a handy rule of thumb that if we understand, it explains a whole bunch of things. the so-called mainstream media do. and the rule of thumb is this. if they share your values, you will get basically an easy ride. if they don't share your values, fasten your seat belt, because it's going to be a real bumpy ride. they treat the tea party to use an easy example one way because they see conservatives as people who aren't very nice and, frankly, who are racist. so, if there is one sign at a tea party rally that is, in fact, racist, it's not only going to get on the air. it's going to be made to be typical of the movement. on the other hand, they see these demonstrators as young idealists. sort of the american version of

the arab spring. as a matter of fact, a number of reporters have made that very comparison which is superficial at best and insane at worst. because the arab spring about people who were trying to overthrow dictators who often tortured people with whom they disagreed and in this country we have elections every two years what in the world is the comparison between the two. that's where the roll of them comes in. if they like you they treat you one way. if they don't share your values they will see you in a totally different way. >> let's talk about the coverage because you also mentioned the tea party. when the tea party was at its height, you saw a lot of the left wing mainstream media coverage pounding the tea party for nonexistence offenses. the racism that didn't exist, the signs that didn't exist. right, in occupy wall street, you actually have some serious law breaking going on. you have got drug use, have you got violence, have you got the open sex and you have got the

anti-semitism and yet, as you point out, the mainstream media is glorifying this movement and roman sizing socialism. >> let's use apple to apples comparison. as i said earlier, if there was one sign at a tea party rally that was racist, it would get on the air. i guess i don't have a problem with that. what i do have a problem with is suggesting that it was typical of the whole movement. but, in this case, we know that there have been more than a few anti-jewish signs. and more that be a few rants against jewish people who supposedly control the whole country by, you know, occupier, wall street occupiers in new york and in other places. and these things don't get any attention because one fits the template. it fits the template that conservatives are racist so we will show the run racist sign

with you it doesn't fit the template that these liberal people are just haters. i want to make clear. i'm not saying at all that these anti-semitic signs are typical of the entire movement. they may, in fact, be outliers. the one racist sign at a tea party rally was also an outliar, that didn't stop the media from smearing the entire movement with that one sign. >> bernie, should we not be at all surprised that the left wing mainstream media has done very little to no investigation into who created occupy wall street, who is orchestrating it, who is funding it, and who is making sure that it continues? >> no. we shouldn't be surprised at all. we should be troubled by it but not surprised. the story line has been written in stone. and we have seen it. these are the good guys, the tea party people were, well, we will say the bad guys to keep it simple. but these people who occupy wall

street, you heard some of these reports. they are shared in their frustration over the fact that the system is stacked against them. we shouldn't be surprised at all. listen monica, i have met people that sell slurps and cigarettes to insomniacs at 7/11 midnight shift who have more intraspeculation than journalists who cover important events in our country. they will never look inward. they will never see their biases. i don't want to end this part of the segment on a bad note. but there is no hope, there is no hope for them ever coming around and doing the right thing. they are not intro speckive people when it comes to their own profession. >> yes, we give up. that's why everybody is here watching fox. bernie, great to see you, thank you. directly ahead, bill gates the wealthiest man in america has some thoughts on taxing the rich. you may be surprised by what he says. stay tuned.

>> in the back of the book segment tonight, the richest man in america is a big barack obama supporter. even is he skeptical of the president's tax the rich plan. billionaire bill gates laughed about the so-called buffet rule in an interview yesterday. >> do you agree with the buffet rule? do you support that? >> well. [ laughter ] >> why is it funny? >> i can't imagine these millionaires and billionaires going down on the streets because they are going to have to pay 4% and 5% more in taxes. i'm not an expert on taxes. clearly you can't raise the taxes we need by going after

that 1%. i'm generally in favor of the idea that the rich should pay somewhat more but to really deal with the deficit gap we are talking about, that alone just numerically is not going to be enough. >> joining us now from washington is ben stein. he is an economist and the author of the new book "what would ben stein do?" so let me ask you that very question, ben stein. you would actually raise taxes on the highest earners, right? >> oh, yes, by quite a lot and then i would raise taxes on the ones below them by a fair amount and the ones below them by a fair amount. i would have the government aggressively try to cut spending and try to get us to a position where you do not bankrupt this country. >> ben, if you raise taxes, especially in a recessionary or weak economic environment of the kind we have right now that is going to kill off this economy for good. >> well, you don't know that. that is a hypothesis of the tax cutters and the supply siders but we don't know that's true.

we had much, much higher that beings taxes than this under ronald reagan of his tenure in office. we did very well. dwight eisenhower had much higher taxes than this and we did very well. isn't clear at all that i see are ing taxes on the rich wouldn't have any effect on the economy at all. the economy is has tons of capital. not short of capital. >> how do you answer bill gates' point even if you went ahead and confiscated 100% of that top 1%'s wealth that means everything, their income, their assets, their property and everything, that would be such a minuscule. that would be like spitting into the ocean in terms of the amount of debt and deficits we're carrying right now. >> it wouldn't be that minuscule. i i agree. this is going to be a proposition that's going to take many years. it's going to have to be gradual and involve both spending and taxing. we just cut taxes way too low relative to our spending. there is no magical solution. you cannot just keep spending and spending and spending and cutting the revenue over and over again unless you are

heading for national default. by the way, there are some very smart people who think we are inevitably going to have default at this point and i think they are right. >> a lot of people in the top%. whether it's 1%, 5% say i would have no problem paying more in taxes if i knew that the government was going to sequester that money and put it toward deficit reduction. but i don't believe that. frankly, the majority of the american people don't believe the government when they say they are going to do that they will find new ways to spend that money. they are never go going to cut spending. tags going to go up. hit the job creators and we'll be in a bigger mess. >> that, in fact, did not happen when president clinton raised taxes. they did not just go and waste the money. they greatly reduced the deficit and put us in a position of surplus. so, there is a lot of data that that doesn't happen. when president reagan raised taxes in '82 through '86 that money was generally went towards lowering the deficit. so, there is just no doubt that what you are worried about is actually going to happen.

>> if you want to go back to say the reagan era tax rates then or the clinton tax rates, wouldn't you also say well, okay, i know you are arguing for cutting spending, then let's go back to 1980 spending levels or 1998 spending levels or 2000 spending levels. so it's equitable. >> i think we have to have drastic cuts in government spending. i just don't want -- the main thing is i don't want us cutting spending on defense and cutting on the poorest among us. there is a great deal of government spending that can be cut. question, should we do it during a recession? laying off government workers during a recession? i question whether that's a great idea. >> you know, ben, when you look at and i know you are an economic historian, when you look at all of the major 20th century recessions that the united states has experienced starting from the 1920-21 recession, every single time the government has gone in and lowered marginal tax rates and coupled that with a stable

dollar, we have had booming economic growth. so i don't really get why you are arguing for raising taxes which would really put the can a bausch on any kind of recovery. >> well, because with all due respect your data is not correct. we didn't have rapid recovery due to lowering taxes after world war i. we had a stabilization of commodity prices. didn't have a rapid recovery after the beginning of the great depression. by any kind of tax measure either raising or lowering it. we did not have -- the connection of raising or lowering taxes with economic activity is extremely unclear. we haven't had a gold-backed dollar now for about 40 years since our friend, mr. nixon was president. i don't think that's can be correlated with anything very much. we are certainly not going to be is v. a gold-backed dollar ever again. we have to deal with the situation as it is. which is we do know one thing for sure. we are running deficits unsustainable. that's got to stop. that's the only thing we know for sure. >> ben, i disagree with you wholeheartedly on the tax issue.

i agree with you on cutting spending. absolutely necessary. great to see you my friend. >> great to see you. >> pinheads and patriots on deck. passengers stuck on a plane for more than seven hours and they had an unlikely ally pleading for help.

>> finally tonight, pinhead or patriots. the northeast was hit with a whopper of a storm, causing travel delays throughout region.

one flight was stuck on the tarmac in connecticut for more than of seven hours. passengers complained of no water and no usable rest rooms. it got so bad the pilot called airport officials pleading for help. >> we can't get to seem to get any help from our own company. is there any way you can get a tug and toe bar to utah and get us towed to a gate or something? i don't care. take us anywhere. >> jet blue is blaming the airport for the delay, but it sounds like there are lots of pinheads to go around. and that's it for us tonight. bill will be back tomorrow, but he would like you to know because so many of you have bought copies of "killing lincoln" he's been able to give even more money to charity this fall. you can get the book at billoreilly.com. if you become a premium member you get "killing lincoln" for free. it's a fascinating read.

thanks for watching tonight. please remember, the spin stops here because we are looking out for you. >> good morning, everyone. it's now november, november 1st. thanks for sharing your time today. i'm gretchen carlson. herman cain coming clean describing the details of his sexual harassment charges. >> i was standing close to her and i made a gesture, you are the same height as my wife. >> the rest of that story and the bigger problem he could face now. >> and when you think fannie mae and freddie mac, do you think about excellence. someone does. they just handed out huge bonuses. you've got to hear this one. >> all right. kim kardashian, hey, i want my money back! after a heartfelt 72 days of marriage, kim and kris are getting a divorce? >> a sham. >> what is there to