this sunday just how big of a threat is north korea? what should president obama do about it? a new unprecedented round of high anxiety over north korea. the threats from a new, young, and largely up known dictator have washington unnerved. >> we take those threats seriously. we have to take those threats seriously. >> a special discussion this morning with senator lindsey graham, republican of south carolina. and perspective from former a.m. bass dore and governor bill richardson. his experience dealing with the north koreans. former under secretary of defense, michele flournoy be a nbc news chief foreign affairs

correspondent andrea mitchell. plus, presidential politics. all eyes on hillary clinton after two high-profile speeches this week fuel speculation about another run for the white house. and the obama agenda, new jobs numbers undermine confidence in economic recovery. and a new budget compromise from the president. is it nearly enough for a grand bargain? cnbc's jim cramer joins the conversation this morning. and good sunday morning. battles at home and abroad for the president as congress returns monday from a two-week easter recess. it's shaping up to be a spring filled with debate on the budget, immigration and guns. and now overseas a brewing crisis in north korea as the president tries to defuse escalating tensions. at the center of it all a young, untested leader, kim jong-un, who is making increasingly

strident warnings about an imminent war with south korea and the u.s. apparently upset about new, tougher u.n. sanctions and recent joint military exercises. the escalating rhetoric has u.s. officials quite unnerved. defense secretary hagel announcing this weekend a decision to postpone a long scheduled missile test to avoid making an already tense situation even worse. secretary of state kerry left yesterday for the middle east, but he'll be traveling on to seoul and beijing laettner the week hoping to get the closest ally, china, help in dealing with this crisis. that's where i want to begin this morning. joining me republican senator from south carolina, lindsey graham. senator, with welcome back to the program. you're just back to the u.s. from being in the middle east. i want to ask you about syria as well in just a couple of minutes. let me start with north korea and what we're dealing with. a couple of headlines in the magazines caught my attention in "the economist" and in "the w k week" magazine. is can kim crazy? korean roulette. this war of words escalation, are we heading to a conflict with north korea?

>> i think what bothers me the most the tolerance in south korea for this kind of provocation is greatly -- they're not going to put up with this anymore. if there were a south korean naval vessel sunk this year, anytime soon, or a shelling by nor north korea, i think the new president of south korea would be compelled to act. i think the north koreans are overplaying their hands. i'm glad we're not doing the ballistic missile test. i'm glad we're telling our allies south korea and gentlejae literally have your back. and the north koreans need to understand if they attack an american interest or an ally of this country they're going to pay a heavy price. >> let's talk about u.s. interests and they're quite real in the region. look at the map, first of all, to give our viewers some perspective. you have japan, you have guam where we had missile batteries placed, moving to north korea and south korea. in the south and the southern part of that peninsula you have over 28,000 u.s. troops. so the danger is real, some kind of conflict breaks out between the north and the south.

we are literally right there in the middle. >> we're in the middle. i'm glad we're there with our allies. but the big difference to me the politics in south korea are changing by the day regarding north korea. so if there's some provocation, it won't be business as usual by south korea. i could can see a major war happening if the north koreans overplay their hands this time because south korea, the united states, the whole region is fed up with this guy. >> but what happens if there is some kind of conflict between the north and the south? that becomes a conflict with the you stays, doesn't it? >> the north loses and the south wins with our help, that's what happens. >> and what about the rest of the region in you're talking about japan? talking more nuclear weapons? >> japan and south korea have not gone nuclear unlike the middle east, because they trust us. as long as south korea and japan trust us to be in the fight, they won't go down the nuclear road. it's important they always believe we have their back, and it's important north korea knows what happens if they engage anybody in the region associated with us, including our own troops, they lose.

>> before i ask you a little bit more about the u.s. response, who is kim jong-un? we put together some facts. his father kim jong-il ran the country. we don't know his actual age. he's about 29 years old. he came to power in december 2011. educated in the west. i know from talking to people at the white house one of the big fears is miscalculation here. we don't really talk to the north. >> if you sold this as a movie script, a 30-year-old guy whose father was born out of a mountain, who had nine holes in one the first time he played golf, this is a surreal place. they're afraid of reunification. they don't want a democratic korea next to china, so they're propping up this crazy regime, and they could determine the fate of north korea better than anybody on the planet. we up our game regarding china. >> i want to ask you about syria before we get more perspective on north korea. you met with opposition forces in syria.

you have been talking about more actively helping them, getting the u.s. more involved. do you have a different view about that now? >> a bit. the syrian opposition council replaced the syrian national council. they want more assistance. i think we should give them more assistance. there's two things that drive my thinking on syria. the key to jordan is a casualty. the worst is yet to come regarding syria if we don't fix this soon. jordan is being overrun by syrian refugees. and before i would arm the rebels, i want a commitment by them that they will allow an international force to secure the 17 chemical weapon sites, enough weapons to kill millions of people, and commit to dest y destroying those weapons. in the new syria they will reject owning chemical weapons. if they would do those two things, i told them, i think there would be more involvement by the congress, there would be more willingness by the congress to help them. they have to commit to destroying those weapons, allowing us and the international community to control those weapons. i don't know what they're going to say. but if they publicly made those two statements, i think it would be easier for congress to help

them. and the radical elements in the syrian three army are growing by the day. the worst is yet to come. we could lose to the king of jordan. this could be the nightmare in the making with the chemical weapons following into radical islamists. the number on the ground is growing every day this war goes on. >> let me get to more perspective on north korea, our lead story. governor, you've got a lot of experience with north korea. what is going on here? >> i think kim jong-un is playing to three audiences, and this is why he's doing these provocative acts. by the way, andrea was with me on one of the eight trips i did. first, he's playing to the north korean generals. they run the show, are the military. he's play iing to the korean workers party, are the leadership there. secondly, he's playing to his own people. he got burned by that missile test that failed, and he feels he has the buttress his domestic

standing, and i think the third thing he's doing, he's testing the new south korean president. every year -- every five years or so when a new south korean president comes in, north korea does a provocative act. so the issue is what do we do about it? i think what we've done in terms of the military posture, the stealth activity makes sense. but i think eventually there's going to have to be some diplomacy and the six-party talks i don't think are working. i think china has to be the key. we have to really get them to lean on north korea. but i think a new diplomatic track is needed. some out of the box diplomacy involving the u.n., the world bank, some special envoy outside of government, because i think we need to get to this new young leader who i don't think is calling the show but nonetheless because it's a daie it ty, because he is nominally in charge, is probably the key player there.

>> michele flournoy, secretary of defense hagel underlining how serious this issue is when he talked about the threat. >> they have nuclear capacity now. they have missile delivery capacity now. and so as they have ratcheted up their bellicose, dangerous rhetoric and some of the actions they've taken the last few weeks present a real and clear danger. >> two things going on there. one, kind of ratcheting up the escalation in words which the administration wanted to tamp down, but kim jong-un is saying i don't want to talk about losing my nuclear weapons. i won't even get into those discussions. so from a diplomatic point of view, what do you do? >> we have to convince this new, young, inexperienced leader he's playing a losing hand. that the only way out of the box to get the economic development he wants, to get the progress

that he wants is to ratchet back the rhetoric, come back into compliance with the international obligations that north korea has and to get serious about trying to implement some of the commitments he's made at the negotiating table in the past. i think in the mean l time the u.s. has been right to focus on bolstering deterrents, bolstering defense, standing shoulder to shoulder with our ally, south korea. >> i would only add this. i think the goal should not just be to calm him down, to cool the rhetoric down. the goal has to be how do we get north korea back to the negotiating table on nuclear proliferation, on denuclearization? they have to do it because that whole asian area is a tinderbox and we have enormous interest. we have 30,000 american troops. they've got hundreds of missiles. they've got maybe up to five to six nuclear weapons. they've got a belligerent

leadership. it's in our national are to try to diplomatically defuse the situation. i think secretary kerry is the kind of person that can come up with that. >> andrea, a more basic question. it's very hard to explain to your children how north korea can exist this way in the 21st century and yet we continue with belligerent lead ership, with a starving population, with a country completely isolated from the rest of the world. how is had this possible? >> the question for your children and all children, for all of us, who are really children in watching this because it is so inexplicable. it is a cartoon leadership. it has to be done through china. i think the new chinese president, she is the only leverage that we have. there have been some promising signs and conversations according to secretary kerry. i'll be with him on this trip next weekend. we'll be on sunday morning in china. and the whole hope is that he is

finally and the new leadership, but this is a critical time, is trying to prepare to exert maximum pressure because as bill richardson and senator graham and michele flournoy have said, no one knows really what is motivating him except trying to assert his leadership. who is the puppeteer? the military more than likely. is he going to do something irrational or will there be a miscalculation? i've been there a couple of times, to pyongyang with bill richardson, and the proximity, 800,000 forward deployed north korean troops and south koreans and americans, we would object lit rate north korea. you have 35 million people living within miles. >> how dangerous -- you once said that north korea was as dangerous as iraq the last decade. do you still think they're that dangero dangerous? >> crazy people and nuclear

weapons, those who pro-liver yate throughout the world are incredibly dangerous. that's why we need to stop syria from getting chemical weapons. the one thing i'm trying to stress is the politics in south korea are strained. there will be no more tolerance for sinking south korean naval vessels or killing civilians by north korea. they need to understand that. that's my biggest fear, guys, that if there's a provocation, south korea is not going to take it anymore. and the reason they don't have nuclear weapons and japan doesn't, they trust us. and so i appreciate what this administration is doing, staying with our allies. >> michele, what do you do with the south koreans right now from a military point of view to tell them to trust the united states, as the senator says, and not act too rashly? >> i think we hold them as close as possible. we do as much as we can to rae assure them. the fact that we have gone ahead with these annual exercises that we sent b-2 bombers, a sign of our extend ed deterrence, strategic deterrence to south korea, all that have is

incredibly important. we've also done extensive planning with them on how to deal with various scenarios of provocation and how we would respond together as an alliance so that they don't feel that they have to lash out unilaterally by themselves. >> a quick question about diplomacy. it's great to say negotiate with the north, but bill clinton's white house tried to. george w. bush has trade to. they got the deal on blowing up their yongbyon reactor. he seems to take the grain, take the fuel, take the money, and then go right ahead and break agreements or at least this regime does. so diplomacy is really a big challenge with this regime. >> a big challenge but we have to do it. what's the alternative? i think we have to recognize probably the longer range threat is the spread of nuclear materials. you don't want north korea selling enriched uranium to iran. they did it to syria, pakistan. that's -- and i remember asking north korean leader, are you guys exporting nuclear materials? he said, maybe. if you continue sanctions we've

to get foreign exchange. now, you know, that's pretty devastating. so, look, i think diplomacy has been tried. i think president clinton probably was the most successful getting an agreement done. president bush, i think, started to negotiate with him. they're very difficult but i think we need a new negotiating track and i think the key is going to be the united states and china. south korea is a major player but i think for domestic reasons they have to be. >> i have a couple seconds left with you, senator graham, and i want to talk about immigration and the budget. do you think that the president's framework that he announced, including change cpi, a gradual way to cut social security benefits, is a good-faith effort on his part? do you think he can actually win some new revenues as a budget deal by doing it? >> there are nuggets of his budget i think are optimistic. it's overall a bad plan for the economy, but when you look at cpi, we're beginning to set the stage for the grand bargain.

harmonize social security with medicare. in return flat ep the tax code, generate about $600 billion of revenue. and if you look at these changes over 30 years, this $4 tril wron to $5 trillion in savings. i'm looking at the biggest spending cut in history by reforming entitlements and the president is showing a little bit of leg here. this is encouraging. his overall budget is not going to make it but he has made a step forward to then titlement reform process that would allow a guy like me to talk about flattening the tax code. >> do you think a grand bargain is possible by july? >> i think if you do immigration and the grand bargain this year will dominate the 21st century, yes. the key to the grand bargain is can we solve immigration? if we can in a bipartisan fashion fix a broken system to regain our lost sovereignty, control who comes to the country, who gets a job, a robust temporary worker program and as to republicans the politics of self-deportation are behind us.

mitt romney is a good man. he ran in many ways a good campaign, but it was in a practical solution, quite frankly. it was offensive. every corner of the republican party from libertarians, the rnc, house republicans and the rank and file republican party member is now understanding there has to be an earned pathway to citizenship. that gives us leverage on immigration with our democratic friends. >> i want to follow that on a second but i want to full up -- you're putting new revenue, as a republican, on the table. >> if we do substantial entitlement reform that will save $4 trillion to $5 tr trillion -- >> what the president is talking about in your view substantial? >> this is a step in the right direction, but harmonizing the age for retirement, means testing both programs, cpi adjustments gets you pretty much where you need to go. >> the republican leader of the senate there yet? >> well, i can tell you this, that the republican party would benefit as well as the democratic party from saving the american economy from becoming greece. if the president will lead on this, and he showed some leadership, no democrat will get to his right.

nobody is going to adjust the age for retirement if the president doesn't embrace it. nobody is going to adjust cpi if the president doesn't embrace it, so he's showing some signs of leadership that's been lacking. i'm encouraged and that puts the burden on us to do the same thing. i think we will. >> on immigration, what stands in the way of a deal? >> we have an agreement between labor and business about the guest worker program, but we're revisiting that. we're hoping to get this thing done in the next couple of weeks is the guest worker program. high skill and low skill labor. how can you access it in an affordable fashion? if we're reasonable with 11 million, if we give them a pathway to citizenship that's earned and hard and fair, get in the back of the line, pay taxes, then the democratic party has to give us the guest worker program to help our economy. that's what we're arguing over. >> will marco rubio be there for you. >> he has been a game changer in my party. he will be there only if the democrats will embrace a guest

worker program and immigration system to replace the broken one and we gain our sovereignty back, securing our borders and having control of jobs. marco will be there. if we get the 11 million on our side it puts the pressure on the democrats to come up with a workable guest worker program. marco has been indispensable. >> one more political question before you go, and that is -- before i do that, let me get governor richardson's take on this, on the immigration fight, where you think it's going? >> i'm very pleased with the work of the gang of eight. i'm pleased with this labor agreement between the afl-cio and the chamber of commerce. if they could get together, republicans and democrats can get together. but i have some significant worries, and i'm a hispanic-american. one, the path to scitizenship. don't make it too burdensome. make it achievable. i've seen reports of this 13 years to get there. you know, let's be reasonable. >> the president wants it to be certain. >> right. and it not be conditional. number two, tying legalization -- the path to

citizenship to border security, i was a border governor. you know, there has to be dramatic improvement in border security but so many people coming in and then you can legalize, that is unacceptable. and, lastly, have some way -- have some way that the drop dead date as late as possible so as many of the 12 million that are here can get in. you know, i just think that this gang of eight work is important, and i hope it continues, but, you know, we have to recognize the humanity and the improvements on the economy of the millions of workers that are here and, also, the politics. >> let me get a final thought on this before we take a break. >> we're not being over run by canadians but people who live in poor and corrupt countries who come here to get work. i understand that. we have to regain our sovereignty, control our border, and there will be border security tied to a pathway to citizenship. there will be an earned pathway to citizenship. you're not going to break in the

line. it will be available to everybody who works hard, pays a fine, passes a background check, but we are going to secure that border, and it will be tied to pathway to citizenship or there will be no deal. >> we'll talk after this break about presidential politics, waiting for hillary clinton. if she's the nominee can republicans beat her? >> i think after eight years of barack obama if things don't change the next democrat running for president will be in trouble. she will be a formedable candidate. i think her time as secretary of state is mixed. benghazi is yet to be told completely. anybody underestimates her on the republican said would do so at peril. anybody can be beat in this country. >> all right, senator graham. thank you as always. good to have you here. we're going to come back after a break and joining me will be politico's maggie haberman who vote a viewer's guide to hillary clinton's future this week as well as our friend republican strategist mike fmurphy and andrea will stick around, michele flournoy, thank you very much for being here. we'll be back after this. [ male announcer ] this is bob,

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you can follow mae all week lock on twitter @davidgregory. this morning i have my top reads of the week including president obama's election 2012 campaign manager jim messina. how he hopes to keep supporters mobilized in support of the president's second term agenda. in case you missed it, the president's club will be reconvening later this month for the first time since 2009 when george w. bush's presidential library opens in dallas, texas. president obama will join four of his predecessors for the gathering. we will be there as well. our political roundtable is here. up next, we'l

let's learn from the wisdom of every mother and father who teaches their daughters there is no limit on how big she can dream and how much she can achieve. this truly is the unfinished business of the 21st century, and it is the work we are called to do. i look forward to being your partner in all the days and years ahead. >> time to talk presidential politics now. 2016 is really not that far away. with us on our political roundtable mike murphy, politico senior political reporter maggie haberman and sticking around with us former governor of new

mexico bill richardson and our own andrea mitchell. andrea, you were at that speech. the unfinished business of the 21st century, does that include electing the first female president who is hillary clinton? >> that was certainly the feeling in the room, and this was filled to the rafters at lincoln center. this was the second of two speeches last week, and she was in both venues in her comfort zone. these are people, the women in the world summit, tina brown summit on friday. vital voices on tuesday which hi hillary clinton founded back 14 years ago. but in both places she was really surrounded by the love and affection of her base, of her supporters. tuesday night, interestingly, joe biden was on the stage, and he gave a rip roaring, crowd pleasing speech. she was more constrained, praising her longtime partner in all of this, but, boy, she let it rip on friday. there was no misunderstanding. if she decides she's running, she has everyone around her, james carville joining here this week, the strongest signal yet.

>> maggie haberman, you wrote something really interesting in politico, the viewer's guide to her intentions and the various benchmarks. pay attention to these things. her business choices, cautious versus candor, the company she keeps, where her book tour takes her. she's going to write a book this week talking about her time at the state department. the muzzle on the big dog, that being the former president, and her appearance. discuss. >> i'll work backwards, actually, starting with appearance, which maureen dowd hit on today in "the new york times" and it's right. you are seeing sort of a new hair style on hillary clinton. i got a lot of pushback on talk ing about that, but the reality is hillary clinton has dealt with this kind of thing for years. she has turned it into a joke, number one. number two, her book, they announced a book deal this week. where you see that tour take her i think is going to be very interesti interesting. we saw a lot of presidential candidates this past cycle use book tours as sort of a masquerade for something else. she doesn't have to do that, but this is an easy pay for her to do a rollout and she did that with living history.

and then lastly, i think, and there were others, but i think most important in terms of company she keeps, the mark penn fa factor gets talked about a lot. he ran her 2008 campaign. that campaign was very mismanaged by all accounts. i think the question is -- and that falls to her at the end of the day. did she learn from 2008? can she make different choices this time? >> can she get david plouffe to run the campaign? as you step back, strengths and weaknesses, what do you see? >> do you think dilger might rob a bank? she's putting on highly produced videos, it's a perfect time to flip on gay marriage. if she's not running, somebody is there. maybe she will join that campaign because it's definitely going forward, i believe. now strength and weaknesses. if you read the d.c. press, it's all inevitable. i haven't seen it as inevitable since the beginning of 2007 when she couldn't lose either. she's an incredibly strong candidate the particularly within the primary, and the crystal ball is foggy. on the one hand, it's kind of looking backwards. on the other hand, it's historic. she has a base, and she's been to the college of losing for

president which is a very rare college. you learn a lot. so i think she is clearly the fro front-runner but i'm making no predictions. >> governor, you have run against her for president back in 2008, and there is something going on about this era of inevitability. it's not just in the democratic circles. maureen dowd quoting squams c carville saying the following about hillary clinton. she's gone to hell and back trying to be president, he's quoted as saying. she's paid her dues, to say the least. the old cliche is the democrats fall in love and republicans fall in line, but now republicans want a lot of people to run and they want to fall in love. and democrats don't want to fight. they just want to get behind hillary and go on from there, says someone who is obviously in her corner. how do you see it? >> well, first, she doesn't confide in me, so that's number one. number two, i think the odds of her running are about 100% to zero. i think she will. she's a formidable candidate. and i disagree with senator graham. she was a good secretary of state. she logged almost a million

miles, you know, enormous challenges. she was a good senator. she can now run as somebody who is out of the shadow of the president. the first woman president. she's got activists all over the country with her. she also has -- and now that i'm out of government -- i talk to a the lot of republicans. they like her. they like her strong performance. and i think you are going to see a formidable candidate. it's still too early, you know, anything can happen. but she's a major player. >> hillary clinton, i mean, andrea mitchell, when we talk about her record as secretary of state, what senator graham alluded to, a mixed record on benghazi, in other aspects of her tenure. look, she still has to deal with the left on her support of the iraq war. she obviously rehabilitated

herself in that real suspect in terms of certainly being seen as tough enough. what does she say? what is the most potent argument against her both within the party and by republicans? >> i have a question as to the management style because will she have learned the lessons from '08 as maggie has laid them out? what kind of campaign will she run? campaigns have changed dramatically since she ran. look, as you said, the david plouffe run campaign for obama. is she on top of all these technical and polling advantages which is really light years from what she did in 08 and did unsuccessfully. >> for all her strengths, she's in a bad position because the superwoman costume will be put on her and then spend four years lifting up locomotives and a cuomo pops up and gets the endorsement of the boston left-handed mill wrights, here is the nar rative when you're te

early front-runner is bad. >> there are generations of women -- i speak to the young women at the conference at both the tuesday and friday conferences. young women and women, mip 95 ye 95-year-old mother, god bless her, they want to see a woman in their lifetime. and this is a real aspiration and that is considering the demographics of our country, most voters are women. >> if you look at the demographic coalition that president obama put together, and we were talking about this on election night. now you can't count all of those and take them for grafted, but that is the kind of coalition that if she does it right could be delivered right to hillary clinton to take into 2016. >> absolutely. it's hard for me to point to a state he got that she wouldn't want to get. >> hispanics, women, young people. >> and i think there is that sense of unfinished business that women voters do feel about her, about the country post-barack obama. i think there's two things. i think, you know, how do you be the future as opposed to the past? that's a real issue for her. that's more of a general

election issue. in 2007 we knew barack obama existed, we just didn't think he was running. >> when have we gone back, mike murphy. he told people it's hard to believe the country goes back and not forward generationally. >> right. it's going to be a trick because we're going to want to relitigate a lot of stuff. we'll hear the word benghazi 3.2 million times. >> how about iraq? >> it is tricky. while she is so strong in the primary, in a general election we make the mistake of identity politics. i used to run the campaign for christine todd whitman of new jersey. we never carried in the exit polls the fae male vote. so people make a mistake about gender voting. it's more complicated than that. any democrat is going to have the presidential year, not the off year, but the presidential year demographic advantages they have. >> bill richardson, what about the vice president of the united states, joe biden, who, if you wake up in the morning, you know he's running.

when i had him here last may, here was the question i asked. who is more likely to run for president in 2016, you or secretary clinton? >> i think we may run as a team. i'm only joking, obviously. i don't know whether i'm going to run and hillary doesn't know if she's going to run. >> there's truth in humor, mr. vice president. and the rich laugh. the difficulty here, you're not like likely to see the kind of primary fight that you saw between obama and clinton, are you? wouldn't biden be very careful about doing that? >> i think biden would run. he's always wanted to be president. he's been a good vice president. he was key in that whole economic agreement that was made. he's done a lot of foreign policy. he's in very good physical shape, so i don't think there will be an age issue. and he has ambition. he has the fire in the belly. when you run for president, you have to realize it's about four years of your life every day in

a different spot. and biden has that sort of eye of the tiger. i don't think he would defer to secretary lyclinton. the relationship is very good. but, you know, when you run for president, you have to just do it. >> i'm fond of him as a republican, just his personality. he's a patriot. but he is the atomic clock of second finance. and i don't think that's going to change. i don't think he'll win a democratic primary. >> i don't know that he can run if she's running. if she's a declared candidate, they have the same base, a lot of the same donors, and he is beloved within the party and look how he pushed the envelope on gay marriage and forced the president into that situation. he's really been on the cutting edge of violence against women. he has everything going for him except that hillary clinton -- >> it's he's not a star. >> let me get to a star in the democratic party, harris, the attorney general of california, and the president underlined that this week by pointing out -- here she is speaking at the convention, by the way, and

i believe we have the exact quote of what the president said in a speech this week paying tribute to her, making a point you have to be careful to, first of all, say she is brilliant and she is dedicated and she is tough, and she is exactly what you'd want in anybody who is administering the law and making sure that everybody is getting a fair shot. but what he really wanted to say she also happens to be the best looking attorney general in the country and had to apologize with that. >> you have to be careful to say. women candidates, women elected officials tend to be judged more base based on appearance than not. obama has these awkward moments. he does personally like her. >> they've been friends for a long time. >> and michelle obama has been part of that friendship. he also says these awkward things about men and nobody complains. he said that about his interior secretary. he said and look at that good-looking guy in the front row. we found the tape of him doing that friday. >> i'm sorry.

>> i think he read a biden speech by mistake. >> should he have apologized? >> i think he did. i think it's political correct insanity but there's a business of blowing this stuff out of proportion which is much harder on republicans and democrats. >> you know, maybe i'm a neanderthal, but i thought that the president's comment was harmless. it was a political speech. he talked about her accomplishments, he talked about her xe it tense, competence. what are you going to read her resume? political correctness has reached a point where it's out of control. am i going to be criticized for instance if i say that a movie star like scarlett johansson is beautiful? are they going to go after me? probably. >> check twitter. we'll get back to you. all right. we're going to get a break in here. we'll switch gears and talk

about the economy and jobs. a bad report came out on friday as the president is pushing a new budget framework. we have cnbc's mr. "

we're back with the rountable and jim cramer is here. great to have you in washington talking about the numbers. up employment rate at 7.6%. we have the chart as well. much fewer than what we have seen. >> stunning, and a lot had to deal with fearmongering. peggy said fearmongering in chief. the president made everyone feel everything was going to shut

down because of the sequester. a lot of the c ere orcs were scared. ben bernanke seemed to understand the hiring is coming back down. >> was is the sequester? >> yes, it was feared it would cause massive layoffs. what was the rhetoric of the white house? lo look, this is really big deed. everyone has to stop and consider how bad it is for the economy. they said, we have to hold back. >> what's happening with the consumer? we know that the housing market is doing better. we know the stock market is going gang busters. you look at those three things, what's holding back the animal spirit of the recovery? >> what we're worried about is the sense if we spend money on oil and real estate, these the big projktd, the things that put lots of people to work and

they're not happening. when you speak with the bankers, they waubd to lend, but they're afraid they're going to lose ma many. the federal is saying we're knowing this economy is anemic, the only thing that is helping is us overseas money. ret rich people don't want their money in europe. japan, people are pulling money out of their local markets and putting it here. >> the fed is not likely to change anything. it's going to keep its foot on the pedal and make sure rates are low and it's buying assets. >> there was a parlor game about when the federal chief is going to end this because the economy is so strong, only the fed chief seems to know it isn't. if president obama wants to do something to please wall street, main street, reapoin ben b bernanke, he understands there's bad unemployment, he's an

amazing man. he doesn't get credit wrfrb. >> what about the credit. you heard lindsey graham saying he sees a grand bargain in the future. he's putting the revenues of the republicans on the future. >> the psychology has been all wrong. build a bunker is not how you change the psychology of a troubled economy. two things, let the republicans pulling him right toward spending cuts because that's the policy solution they need. and i'll give him credit, he's read the clnten handbook and tried to triangulate, and the more he heat he takes on the left, the closer he is to a real deal, and second, put the white house behind the keystone pipeline. just go. those two messages that he's going to have energy policy would keep the economy going. >> but if they're too tight on the spending cut side, they rediagnosis the problem in terms of the sequester having frozen things up and also in that

number and job numbers month to month, you know better than anyone, bounce around. but participation rates are at historic lows. >> and the other thing is we know what the president wants is more spending. he wants more spending in infrastructure, wants to restore the education. he wants to become a jobs president. hillary clinton, if she's coming off an obama administration where a jobless economy is in place, that's not what she wants. >> if the economy doesn't turn around, i don't believe hillary clinton is 100% running. i believe if the economy is bad in two years, that's a tougher road for her. in terms of what the president wants, absolutely. >> i think, david, if the president gets immigration reform, and it looks like it might happen sooner rather than later, and he has come forth with a serious budget proposal

angering his democratic base by saying, you know, we're ready to look at medicare and social security reductions, cuts, and then saying that he is somebody that wants to bring people together, he's going to have a very good year. and it's going to be a good year for democrats. i see, i'm out in new mexico, the economy is getting a little better. slowly. there's more confidence. more better housing, more investment. and then hopefully, we look at an energy policy which i think is desperately needed, comprehensive energy. >> jim, that's what you're sharick your head, nodding in agreement on energy. >> you want to put 60,000 people to work in this country in four weeks? because these jobs are there? keystone pipeline, but this is a fossil fuel versus greens debate. why do i say the pipeline does work? because these pipelines have been the creators, the largest creator of jobs in the last four years.

you may hate fossil fuel. you may think it's ridiculous to have oil and gas in charge of hiring, buttee have tons of oil and gas in the wrong places. you put dhoun put thousands of work on the pipelines, you put people to work all over the country. the what needed to happen. >> i wanted the bottom line question as well, are we out of recessi recession? are we in the midst of a real robust recovery? >> we'rane profits recovery wrfrb you're going to hear companies reporting earnings. but because they're not hiring, i'm doing a study right now of 30 stocks in the dow jones. you're going to see negatives, literally, they had more people working four years than now. bring the jobs back, and one of the secret we can do is oil and gas, so cheap in this country, that it pays to manufacture here, not in china, not in vietnam, not in thailand. bring the jobs back. >> if the president can inoc

uate himself with this, they have sterling trudentials with that movement, and he has to make this decision, this is a state department decision. even though it will obviously come out of the white house. so kerry, if he's the one making the decision, it's tough for him. it will at least help the president with that part of his base. >> the unemployment numbers would be so much better six months from now if they say, listen, we have to make a bargain on fossil fuels. >> we been in this experiment for five years which will be a big political problem for the next democrat running for president. he wants to have a great second term, the price is to do what most pragmatic politicians do, lose your base and go big. energy, big fiscal deal. a lot of painful medicare cuts. the bottom line, the fiscal, the entitlement reform is not a bargaining chip. it's a national imperative. >> speaking of that, governor, he's meeting with republicans again this week. remember, the last time, two weeks ago he met with a group of

republican senators. he'll baunt to no doubt talk about the budget. talk about immigration, which is a budding deal, and about guns. you think there's anything to what mike is saying? would he cut the base? >> he won't cut the base loose. i think the base really recognizes that the fiscal situation is a dominant issue in our country, and that we have got to find ways to not just reduce spending but deal with this entitlement reforms. at the same time, i think the president is going to move forward on an immigration bill which, you know, is economically a jobs driver. >> true. >> so what we have here is i think a scenario where a grand bargain is possible. we reduce the deficit. i don't think the sequester, you know, getting $85 billion out of the economy, has been at least out in the hinderlands, has been that devastating. yeah, it is to federal workers who were great, et cetera, but i

think the grand bargain, a successful second term in the offing, now some foreign policy initiatives, latin america, mexico, north korea, iran. i just think he tackles those and then he's going to have a very strong second term. >> the other thing coming to a head, of course, is the gun debate. i spoke to jim messina, and he recognizes it would be a tough vote, but he put republicans and democrats on notice for 2014. >> look, i understand that there is real -- there's a tough political vote. i'm from montana. i understand the politics for an organization who says we can change the politics on the ground and say to members of congress, look, there's real support for these things. and, david, there's a political price to be paid if you opposed it. i understand it's a tough political vote only in washington, but if i was a member of congress, would not want to go home to my district

and in the 2014 election defend voting against something that 90% ofonstituent support. >> is this a 2014 issue? >> i think it is, absolutely. and i think the white house, if they wanted to move on this, would have capitalized on the momentum after newtown. there's a feeling they missed their window. >> is it missing their window or going for too much? >> a weapons ban, magazine ban? >> they got the dianne feinstein 45 and start eed playing that record. they should have gone fast, one bullet, metaphorically speaking, at the background checks. when you win a big election, you tend to get cocky, greedy, i think the new chief of staff might be changing that, and they blew an opportunity. but maggie is right, they have trouble in 2014 in the senate. much more republican, a lot of republican states. people like max baucus. you're not going to hear mussina giving that speech for baucus,

so they're looking for wedge voelths. >> do you see it passing? >> at this stage, they're at receive at not getting the straw purchasing piece. >> which is surprising. >> and the american people are so far in front of their legislators. this is the fact of redistricting and the fact that these are congress people for life. and they don't feel the pressure. [ washer and dryer sounds ] for the things you can't wash, freshen them with febreze. ♪ because febreze doesn't just cover up odors... it penetrates deep into fabrics to eliminate odors and leaves a light, fresh scent. just another way febreze helps you breathe happy. [ sneezes ] [ male announcer ] if you have yet to master the quiet sneeze...

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