DISCLAIMER: THE FOLLOWING "Cost of Freedom Recap" CONTAINS STRONG OPINIONS WHICH ARE NOT A REFLECTION OF THE OPINIONS OF FOX NEWS AND SHOULD NOT BE RELIED UPON AS INVESTMENT ADVICE WHEN MAKING PERSONAL INVESTMENT DECISIONS. IT IS FOX NEWS' POLICY THAT CONTRIBUTORS DISCLOSE POSITIONS THEY HOLD IN STOCKS THEY DISCUSS, THOUGH POSITIONS MAY CHANGE. READERS OF "Cost of Freedom Recap" MUST TAKE RESPONSIBILITY FOR THEIR OWN INVESTMENT DECISIONS.

Bulls & Bears | Cavuto on Business | Forbes on FOX | Cashin' In

Bulls & Bears

This past week's Bulls & Bears: Gary B. Smith, Exemplar Capital managing partner; Pat Dorsey, Morningstar.com director of stock research; Tobin Smith, ChangeWave Research editor; Scott Bleier, HybridInvestors.com president, and Bob Olstein , Olsten Funds president.

Trading Pit: Deadly Florida Storms

Deadly tornadoes rip through Florida. Destruction everywhere and Americans are rallying to help the victims. When disasters hit other nations, the United States is expected to help. In tragedies such as these, why do we rarely hear of other countries sending us aid?

Gary B: That's a great question. I guess people in other countries think the U.S. just doesn't need aid. Here's an example: If you went outside and saw your neighbor's house on fire, you'd go out there and offer assistance. It wouldn't matter if he were ten times richer or even 10 times poorer than you. It's just the neighborly thing to do. Maybe other countries forget that. I'm really proud that the U.S. helps out other countries. I think that even if there were a natural disaster in North Korea, we would even send aid.

Tobin: I use the analogy that if there were a hurricane in Beverly Hills, no one would rush to help out because they're all rich. It would be assumed that people in Beverly Hills have insurance and wouldn't need the money. The gesture is the issue. We are the big guy on the block and have a lot of money. That's why other countries don't offer us money—it just goes with the territory.

Scott: When there is a regional disaster like this, nobody can get there faster than us. No one has our resources and technology. No one can get the job done like we can. BUT the offer would be very welcome and would be a nice political gesture for some of our not-so-friendly neighbors.

Pat: I think it does take something of a huge magnitude to see any international assistance. I don't think the U.S. is sending aid every time there is a tornado in another country. When there are very large disasters, we are very generous because we have the resources. When Hurricane Katrina hit, other countries stepped up to the plate and sent money here.

Bob: Well, I think the good news is that we really don't need the aid and have to deal with what we have to deal with. We are the ones that have to worry about the poor victims of this tornado. The fact of the matter is, I could care less whether the international community helps us out or not.

Can Social Security Be Saved Without Raising Taxes?

In an exclusive interview with our Neil Cavuto, President Bush said that he would not give up on fixing Social Security. But will he be able to get a deal on Social Security without raising taxes?

Gary B: It's a great idea and he's on the right track, but there is no way. Without having the Republicans in control of Congress, the Democrats are going to wait him out and play the class warfare/raise taxes card. There are too many people out there addicted to Social Security.

Pat: You can raise taxes or cut benefits. And you can call it raising taxes or eliminating a tax loophole. All we're really doing is going back to the original intent of the program. Right now, Social Security is set up as a "pay as you go." The problem is that there will be more people taking out than putting in. Unless we raise the age level, cut the benefits, or raise the contribution level, the "pay as you go" plan will break down.

Bob: Taxes will have to be raised to get Social Security on sound footing. We need to set up someone like NYSE CEO John Thain to become a czar in charge of Social Security. We have to allow people to invest 50 percent in equities to raise returns and make it a 401K. Then we can save the system. Right now, it's just too conservative.

Tobin: When the Social Security was started, people only put in just 1 percent. Now it's 6 percent and that amount is matched by the employer. We also have to separate Medicare from Social Security. Medicare has huge liabilities. We need to raise the amount of return we get on our investment. President Bush was right to say that if we put our money in the stock market, we would get a higher rate of return. Unfortunately he's not going to be able to sell it.

Scott: Raising taxes will not save Social Security. You can raise taxes every year and it will not close the gap. It's a "pay as you go" program and is a traditional pyramid scheme. The money I'm paying in now helps someone else. The only thing that will fix the program is to raise the age, cut the benefits, and privatize.

Stock X-Change

Each of the guys picked his Super Bowl team and the best stock from that city.

(If you want to watch what each had to say about his stock, click here.)

Tobin: Simon Property Group (SPG )

Pat: CDW (CDWC )

Scott: AptarGroup (ATR )

Gary B.: Boeing (BA )

Bob: Morgan Stanley (MS )

Predictions

Tobin's prediction: Ignore liberal media bia$! Dow up 15 percent this year

Gary B's prediction: Michael Dell makes all the difference; Dell (DELL ) up 25 percent

Pat's prediction: Eat it up! Whole Foods (WFMI ) gains 50 percent in 2 years

Bob's prediction: Halliburton (HAL ) up 33 percent as natural gas supply falls

Scott's prediction: Valero LP (VLI ) is a pipeline to profits; up 30 percent

Bulls & Bears | Cavuto on Business | Forbes on FOX | Cashin' In

Cavuto on Business

On Saturday, February 3rd, Neil Cavuto was joined by Ben Stein, "26 Steps to Succeed in Hollywood" author; Joe Battipaglia, Ryan Beck & Co. chief investment officer; Tracy Byrnes, New York Post business writer; Gary Kaltbaum, Kaltbaum & Associates president; Laura Schwartz, Democratic strategist and FOX News contributor; and Ed Koch, former New York City mayor.

Bottom Line

Neil Cavuto: Hollywood's "war on the war." Are Jane Fonda and company inflicting damage on America and our markets? Hollywood celebrities are uniting to bash America, the President, and the war in Iraq, and they promise to keep the message going. Mayor, you say these folks pose a threat. What do you mean?

Ed Koch: Well, I think they're the pits! And I believe Baghdad Jane is back — heretofore Hanoi Jane, and Susan Sarandon — terrific actress; Tim Robbins — terrific actor, but, their politics are radical left, and I think that the country knows that by now.

Neil Cavuto: All right, but the country saw it and the market was going up through these rallies and everything else. So is the market ignoring this?

Joe Battipaglia: Well, for now, the market is comforted by the fact that we have not been attacked and we've got a muscular foreign policy, but, if they succeed and the terrorists see that we're receding from the war on terror, at some point the Iraqi oil fields will come into play; our own security will be at risk, and the markets will suddenly have a risk premium that they did not anticipate.

Tracy Byrnes: You know, I think it's bad because it shows a country divided. At the same time, I don't know how much credibility they have any more. They're old-school Hollywood. It'd be different if you had Brad Pitt and Angelina Jolie at the helm screaming and anti-war bashing, but, I'm not sure younger people even know who Jane Fonda is.

Neil Cavuto: Laura Schwartz, it was interesting when I looked at the politicians who came there — I think Dennis Kucinich was pretty much it. Why did the established Democratic hierarchy avoid it?

Laura Schwartz: Well, it's not just the message, which the majority of Americans agree with, but it's the delivery, and that's where they really missed the boat — with the Hollywood very-far left and only Dennis Kucinich and maybe a few others showing up. Take that versus last spring when the immigration rally had both Republicans and Democrats of good nature in the Senate speaking at it. The organization of this [war] rally really lost its momentum once they came out and had a very loose message and just bashed instead of talked about what we could do better as a country.

Neil Cavuto: So Laura, you thought it was a mistake to even hold it?

Laura Schwartz: No. I think holding it was great! It demonstrates that America is at its breaking point. The majority of America is against the surge and it's very well timed with the Iraq resolutions coming up next week in the Senate. Just on Friday, Senators Levin and Biden signed on to Senator Warner's resolution. So it's good timing. But your delivery is lost when you choose the very far left that obviously — even for people who don't even know Jane Fonda — this was not a good venue for her to come out in, and it did not help the cause in the end.

Neil Cavuto: Gary, what do you make of that – that as the Mayor said the timing in the middle of a war wasn't good, and that the message wasn't sound?

Gary Kaltbaum: Well, look. First off, I don't think I'm going to be having tea and crumpets with Sean Penn any time soon, but I say let ‘em at it. Let them say whatever they want. We turn into Hugo Chavez if we start to stifle people just because they disagree with us. Let them go out there and say what they want. It speaks for itself when you only have Dennis Kucinich show up. That is not the mainstream, and I do not think that's where the middle of the country is.

Ben Stein: Well, I don't like Sean Penn at all. I certainly do not like Jane Fonda. I think their politics are disgusting. I do think they happen to be right about this: I think it's long past time for us to get out of there. But I don't see what it has to do with the stock market — I'm sort of puzzled by that. The stock market is very, very happy. Price-earning ratios are rising. Prices are rising. The stock market doesn't care about this.

Neil Cavuto: What do you think about that, Mayor?

Ed Koch: I believe that these people obviously have the right to say what they want to say. No one's going to shut them up, but I don't think people are listening to them. I don't happen to believe in the surge. I have a different point of view.

Neil Cavuto: Tracy, the argument is, like Ben says, if this were to worry the Street, it has a funny way of showing it. We've had record after record this week. I think they're well aware that this is a divisive war. I was on the floor of the New York Stock Exchange this week when the President was there. They're either ignoring it or focusing on the good economy and just dismissing it. So, I don't know what a rally of a lot of upset actors and actresses does to dissuade them.

Tracy Byrnes: I don't think it does anything. I think Ben Bernanke holds more power than Jane Fonda ever will.

Ben Stein: You're not kidding!

Neil: You know Jane wanted to run the Fed.

(LAUGHTER)

Tracy Byrnes: To Laura's point, they offered no solution. If you're going to get out there and you're going to say something, then tell us how to fix it. They didn't. They just cried and barked and screamed and went home. And nobody knew who they were, and nobody cared.

Joe Battipaglia: However, if we're going to yell and scream about a cohesive strategy and then not have one, and Iraq collapses, and the oil market gets thrown into jeopardy with a $100-plus barrel price, the markets will recognize it. The forward look here is that this crack in the country could become a widening chasm that causes us to have major problems in the economy in the years ahead.

Neil Cavuto: Laura, are Democrats concerned about being associated with this Hollywood left that came out against the war? As the Mayor said, they're free to do that. But, does the Democratic Party fear association with this part of Hollywood?

Laura Schwartz: Absolutely. Because they learned, especially in 2006, by not being beholden to the left they can really make some strides with the middle of the road Blue Dog Democrats and the moderates in this country who are going to decide this next presidential election. You can't look like you're too far left as a Democrat running for re-election in the House or Senate or for the President election in 2008.

Ed Koch: Well, what Chuck Schumer said was that the Democrats didn't win this last election — the Republicans lost the last election. And for Democrats to win — and I'm a Democrat — they have to be moderate, not perceived as radical left like these people.

Joe Battipaglia: Democrats are providing no leadership to the radical left. Listen to what they're saying. They unanimously approved Petraeus to run the operation in Iraq, but yet they talk about not funding it. They want more troops in Afghanistan, but they don't want more troops in Iraq. I ask you: Which is more strategic right now — Iraq or Afghanistan?

Ben Stein: There is a simple strategy about Iraq, which is to just get out of there. We don't belong there. It's what Jim Rogers keeps saying: It's a police action. Our military was not created to fight police actions between warring sectarian Muslims. We won the war. We got rid of Saddam. Let's go home. That's it!

Laura Schwartz: And to the question about whether Afghanistan or Iraq is the priority… I mean Afghanistan would be the priority if you talk to about the War on Terror. We still haven't gotten Usama bin Laden. We have seven-times as many troops in Iraq. The latest national intelligence estimate shows it's not al Qaeda in Iraq; it's the Sunni and Shia civil violence

Head to Head

Excerpt from Neil's interview with President George Bush:

(BEGIN VIDEO CLIP)

President Bush: … growth overall for the economy in last year was 3.4 percent, which is better than 2005, and so it is good news. It's good news for workers; it's good news for entrepreneurs, and it's good news for the budget. I'm pleased.

Neil Cavuto: But, you don't get much press for that.

President Bush: Well, I understand. You know, we're in changing times. We've got a war that we're fighting against extremists, radicals, who would do us harm. We're in a major battle in that war in Iraq. So, I'm not surprised that some of the good economic news is overshadowed by the difficult news out of Iraq.

(END VIDEO CLIP)

Neil Cavuto: President Bush taking the high road… but is it high time that he start calling the media out for portraying this great economy as a lousy economy. Time to go head to head!

Ben Stein: Well, I don't think the media is portraying it as a lousy economy. They were for a long time, but I think they've stopped. And I think everyone in the market can see that the media is not affecting the market. This market is super, super strong. I think the media is way too hard on President Bush and they don't him credit for what he's done right. President Bush doesn't seem to be able to make the stock market go down; the media doesn't seem to be able to make it go down; we have a very strong economy.

Ed Koch: I agree with Ben. But in addition to that, when he [the President] spoke here in New York City, he said to me: Don't worry about me. I'm not down. Meaning he wasn't down emotionally. The President is not getting the credit he should get with respect to the economy. The economy is booming!

Neil Cavuto: Laura, what do you make of that? Do Democrats in their heart of hearts really think this is a lousy economy?

Laura Schwartz: Well no, and for Wall Street and the affluent Americans it's a great economy! But, and I applaud the President for hitting on this the other day, there is a disparity of money in this country — a disparity of wages.

Neil Cavuto: But is that disparity any worse than it was 10 years ago?

Laura Schwartz: We have a widening wage gap in this country and it's something both Republicans and Democrats find as a serious problem. And I don't think people get their feelings on the economy solely on how much they have in their paychecks. Instead, they look at out-of-control spending and a rising deficit, as well as rising health care and education costs.

Neil Cavuto: The deficits are going down. Joe, what do you think of this view?

Joe Battipaglia: The President's ball and chain is Iraq. He's going to live and die by what happens there. The economy is doing extraordinarily well. The Mayor said it perfectly: See what the stock market's doing! But when you talk about income gaps and two Americas and you try to explain that to the American people their eyes glaze over. The reality is Americans are working; they're accumulating wealth, and that prosperity can continue. The Democrats, unfortunately, do not have an economic program that makes sense because right now the economy is strong.

Ben Stein: That is a brilliant point! The Democrats have no economic policy at all. The Republicans do and that's a huge plus for the Republicans.

Gary Kaltbaum: Neil, I don't think the President should spend one second on the media. Not only have they not reported, but also they have underreported the good news on the economy. And where I disagree with Ben is I think they are talking down this economy — they've been doing it for months. They've been getting away with it because of Iraq and they know they can.

Neil Cavuto: Laura, I don't think there's an agenda per se, but I think we look at the half-empty glass a lot of the time. And the New York Times' and Washington Post's portrayal of recent economic numbers — they lead with them and then write about the problems. So I wonder if there's a predisposition to assume the worst?

Laura Schwartz: I think in our era of Iraq there almost is. Because you're right… it's Iraq, Iraq, Iraq. People are seeing all the money that's getting spent there on reconstruction. They're saying show us the money! Last year in this country, we had more people file for bankruptcy than graduate from college. And people see that in middle America and they're voting on it.

Neil Cavuto: Laura has the final word on this subject. I want to get you back sometime despite you comments… but it's always good to see you!

Laura Schwartz: (laughs) Thank you very much!

Neil's Exclusive Interview With President Bush:

(BEGIN VIDEO CLIP)

Neil Cavuto: You're in what they call the "Land of the Fat Cats," the middle of Wall Street. Salaries among the top five brokerage chairmen, Mr. President, were combined, close to $300 million. There is an effort on Capitol Hill, as you know, to rein that in… to maybe even partly legislate it. What do you think about that?

President Bush: Oh, I don't think the government should be deciding salaries of CEOs or anybody else that works for corporate America. I do believe that the role of the government is to promote transparency so that shareholders will know the compensation packages of the executives that have been hired. And I strongly believe that the role of the CEO ought to be to enhance shareholder value, and that's what packages ought to be based upon.

Neil Cavuto: Well, with those eye-popping salaries, a number of Democrats have said, ‘Well, they can afford to pay more… the rich can afford to pay more. It's time to increase taxes on the upper income.' What do you think of that?

President Bush: Well, that's the old saw… you know, raise the taxes on the rich. And, when you try to raise the taxes on the rich, you also raise taxes on small business owners, sole-proprietorships, subchapter S corporations. You know, it turns out that these tax increases are going to have to reach fairly far down the income level to meet the spending appetite of the Democrats. My attitude is let's do what we're doing now, which is to keep taxes low on everybody who pay taxes and watch how we spend the money so as to keep the economy growing, keep revenues flowing into the Treasury, and balance this budget. And next week, our OMB director, Rob Portman, will be submitting a budget that balances the Federal government's budget in 5 years.

Neil Cavuto: Let me ask you about Social Security.

President Bush: Sure.

Neil Cavuto: You touched that third rail very bravely and were burnt badly for it. Republicans wouldn't back you, Democrats were all over you. You said that it needs market-type reforms. Now, they've come back, Mr. President, saying you have to increase Social Security taxes. There was this talk, that maybe your Treasury secretary was entertaining that idea… to strike a deal on Social Security. Are you?

President Bush: First, let me correct you for a second. I don't think I have been burned for bringing up an important issue that I started talking about in the 2000 campaign and have really addressed in every State of the Union address. The reason I say that Neil is it's the job of the President to confront problems and call Congress to join him and confronting those problems.

Neil Cavuto: And they haven't.

President Bush: No, they haven't yet!

Neil Cavuto: What they have been saying, sir is that they want to raise the Social Security income threshold. I think it's at $97,500 right now.

President Bush: So here's my answer to them: Bring your best ideas.

Neil Cavuto: So you're open to raising the threshold?

President Bush: Well, we'll bring our best ideas to the table. What I want is I want people to come to the table. I have said we can solve the Social Security issue without raising taxes.

Neil Cavuto: But is raising the threshold…

President Bush: That's raising taxes.

Neil Cavuto: It is?

President Bush: Yes. And I believe I've got a plan to show them how to solve the problem without raising taxes. That's my best idea. I want to see their best idea.

Neil Cavuto: Hugo Chavez in Venezuela is going to be taking over a lot of businesses by the end of the week. He will effectively be a dictator. And you have urged that U.S. companies affected be compensated. If they are not —

President Bush: Well, it's a hypothetical. My worry, of course, is that the nationalization of industry will make it harder for the Venezuelan people to be lifted out of poverty, will make it harder for the people to realize their full potential. I'm concerned about the Venezuelan people.

(END VIDEO CLIP)

FOX on the Spot

Mayor Koch: Stand up to Islamic terrorism or be destroyed!

Ben: A gallon of gas is the best bargain on the planet. Thanks, Exxon!

Gary: Economy heating up; 5 percent growth in 1st quarter!

Joe: Gov't meddling in CEO pay would result in disaster!

Tracy: Microsoft's Vista a dud; take a bite out of Apple (AAPL)

Neil: Al Gore will get Nobel Prize for Bush bashing!

Bulls & Bears | Cavuto on Business | Forbes on FOX | Cashin' In

Forbes on FOX

In Focus: America's Strength

Steve Forbes, editor-in-chief: Our economy stays strong through natural disasters, like this one in Florida, through a war and terror attacks because we're a free country and we have a free market. People respond to circumstances. If they have a disaster they find a way to deal with it. A prime example is after WWII. Europe was devastated. We provided an environment of freedom and put in the resources to do the job. We did in six years what experts thought would take 60 years. Freedom works!

Victoria Barret, associate editor: I think our economy is in great shape. I think what Americans recognize is that the government can't solve all problems. We saw this with Katrina when lots of philanthropic organizations and private companies stepped in.

Quentin Hardy, Silicon Valley bureau chief: Americans believe in optimism and that things can be better for their kids.

Mike Ozanian, senior editor: I think the biggest reason we can weather all these storms and war is that we're the richest country in the world. We need to continue to be vigilant and remember what has made us the richest country in the world, which is free market capitalism. That's where the credit should go.

Rich Karlgaard, publisher: Capitalism is built on a fundamental morality that the framers of our Constitution recognized. It's supported by the values we learn from churches and charities. That's the magic combination.

Neil Weinberg, senior editor: We shouldn't give ourselves too much credit. The Soviet Union rebuilt after WWII and no one would say that they were free. It's part of human nature to rebuild, whether you're free or not.

Should CEO Pay Be Tied to Performance?

Quentin Hardy: CEOs use to say they were risk takers. That's not true. They have compensation committees who make sure that everyone's pay goes up. The head of Home Depot, Gap and Pfizer all failed and they all got tens of millions of dollars anyway. The downside of being a CEO now-a-days is that if you fail, you'll only get $10 million.

Steve Forbes: It depends on how you define performance, short-term or long-term. Also, if you want to hire people you're going to have to give them money they would have gotten at their old firm. For example, $180 million of the $210 million severance package for Bob Nardelli, Home Depot's former CEO, was money he was going to get from GE. He gave that money up to go to Home Depot. Home Depot had to make good on that.
If you really want accountability with pay, remove these provisions like poison pills that prevent hostile takeovers, have full disclosure demanded by the SEC and let the shareholders take care of the problem.

Jim Michaels, editorial vice president: The trouble is too many of these performances are phony performances. They're tied to how the stock does. The stock can go up without the CEO doing anything if there is a bull market. You have to tie performance to specific objectives.

John Rutledge, Forbes contributor: I've hired and fired a lot of CEOs in my day. I like them to be on my side of the table as a shareholder. I don't like them paid on the stock price. I'd like them to be paid on building value for the company. I'm not paying the CEO for the stock market going up 10 percent a year.

Elizabeth MacDonald, senior editor: When you tie pay to earnings targets you give incentives to commit accounting shenanigans to boost those earnings. There is almost a turn style in executive boardrooms because CEO tenures have been shortened. You don't want Congress legislating CEO pay.

Rich Karlgaard: I think we the shareholders are very culpable here. Too many shareholders look at the stock market like a casino. When you're a shareholder you're a part owner of the business. And when you are part owner of the business you need to put pressure on your board of directors and on the compensation committees. We're not victims here.

Flipside: $top Global Warming With More Tax Breaks for Big Oil!

Mike Ozanian: If you really believe in global warming you'd lower Exxon Mobil's tax rate to that of companies like the New York Times, because oil companies are the best experts at finding alternative sources of energy. They are already spending a ton of money on it. Their incentive is profits, which is the best way to find alternative energies.

Lea Goldman, associate editor: You're relying on oil companies to take these subsidies and do something good. I think they have no incentive to do this because more alternative energy means less oil that people are buying.

Steve Forbes: Why clutter up the tax code even more? If we want alternative energies then lower the capital gains tax and remove the barriers to nuclear energy, which would make us in compliance with Kyoto. Also, remove the barriers to drilling offshore so we can finally tap the energy we already have out there.

Neil Weinberg: The political reality is that we have to do something about global warming. Why not give incentives to big oil companies, who have lots of knowledge. At least they'll have proper incentive to try and get a bang for their buck.

Jim Michaels: Subsides is lousy policy. They lead to corruption and bad investments. Oil companies have every incentive to develop alternative energy. They want to stay in business when the oil runs out and their profits are sufficient to pay for it. If you're really worried about global warming, get out on the street and demand crash courses on nuclear energy.

Informer: Super Bowl Big Spenders!

(If you want to hear what each panelist had to say about their stock pick, click here.)

John Rutledge: Anheuser-Busch (BUD)

Victoria Barret: Garmin (GRMN)

Elizabeth MacDonald: Toyota (TM)

Lea Goldman: CBS Corp (CBS)

Bulls & Bears | Cavuto on Business | Forbes on FOX | Cashin' In

Cashin' In

Our "Cashin' In" crew this week: Jonathan Hoenig, Capitalistpig Asset Management; Dagen McDowell, FOX Business News; Jonas Max Ferris, MAXfunds.com; Charles Payne, Wall Street Strategies; Adam Lashinsky, Fortune Magazine, and Stuart Varney , FOX Business News.

Stock Smarts: Impact on America if "The Left" Got Everything It Wanted?

If the Left got everything it wanted, what would happen to America's economy and the stock market? The Left's agenda is clear: pull the troops out of Iraq, higher taxes on the rich, universal health care and unionizing Wal-Mart workers. Those are among some of the highlight.

What would be the impact if all of this happened?

Charles Payne, Wall Street Strategies: It would be a disaster; higher taxes for the rich? I say it's going to be for a whole lot of people that aren't rich. It will be vilifying capitalism, self-made success and pitting Americans against Americans. That's a sinkhole for the economy and the spirit of this country.

Terry Keenan: If that's true, how come the stock market hits new records day after day?

Jonathan Hoenig, Capitalistpig Asset Management: The stock market is forward-looking, Terry. I think Charles hit on it with the vilifying capitalism part. Economically, when you look at the Left's philosophy, it's socialism. And the most prosperous countries in history, including ours, have always been capitalist countries. America isn't great because we have the biggest muscles or the most natural resources. We're the most capitalist. And the extent that the Left pulls us in the other direction, I do think we're screwed.

Adam Lashinsky, Fortune Magazine: It's insulting to refer to the Democratic majority in Congress as the Left. We're ignoring a lot of the history here. The things that the Democrats are talking about doing in Congress have been done extremely successfully over the last century in the United States. It was a pretty successful time for American capitalism, I would argue.

Stuart Varney, FOX Business News: I just don't see how you can argue against the idea that the Democrats are going to raise taxes. They are going to impose more strict regulation of industry and restrict trade.

Terry Keenan: How do you know they'll raise taxes?

Stuart Varney: That's what they say they are going to do. That's their entire mantra. It's not ‘if the Left gets its way'; the Left will get it's way. You will see all kinds of changes in taxes, trade and regulation. The result will be much slower growth in the United States, fewer profits and ultimately the market will not maintain its current level.

Dagen McDowell, FOX Business News: But Stuart, President Clinton raised taxes on higher-income Americans.

Stuart Varney: And look what happened for the first two years after that. The economy was dead flat.

Dagen McDowell: Look at the years after that.

Stuart Varney: Yes. After the Republicans took control of Congress in 1994. That's when things took off.

Jonas Max Ferris, MAXfunds.com: Stuart, they're saying they are going to do it. Bush said he was going to fix the liability and the health care business. They didn't do it. The fact is that a lot of this stuff isn't going to get done, and that's why Wall Street's strong. Fringe-left element policy would be bad for the economy. A fringe-right element would be just as bad for the economy as well. You don't get a lot of that, fortunately. That would be like banning the government from doing research.

Stuart Varney: There has been a shift in public opinion and a shift in political attitudes in America in the last six months: towards the left, towards higher taxes, towards a fairer society. That's the shift. And it's going to happen.

Jonas Max Ferris: I agree, but it's not far enough to be dangerous to the economy. That's the point I'm making. It's kind of mild.

Charles Payne: It's just that because the Democrats don't have the White House yet. Listen, I think Wall Street is forward looking, but it's not looking beyond perhaps the next few years. Look at consumer confidence numbers. Americans do feel better about themselves. They feel better about themselves than the Democrats in the media say they feel about themselves. Consumer confidence is through the roof. Consumer spending is through the roof. People feel good about where they are right now. So why shouldn't we shift it so far this over?

Jonathan Hoenig: Society is like an aircraft carrier. It doesn't turn on a dime. I do think that, to Stuart's point, there is a slow shift towards what I call socialism in this country. And you see it because the Democrats believe that the public should own everything. There should be no private ownership of your health care, your job security, your union benefits and what not.

Terry Keenan: It's not just the Democrats, though, Jonathan. Mitt Romney put in a program in Massachusetts.

Jonathan Hoenig: You're absolutely right, Terry. We're talking about the Left. There are problems on both sides.

Adam Lashinsky: Jonathan, you're just doing some ranting and raving here. Nobody in the United States Congress is against private ownership of capital. That's just silly. What we're talking about is responsible government policy that achieves certain social gains that we all agree on. It's crazy to say that people don't believe in private ownership.

Jonathan Hoenig: Aren't they talking about public health care, social health care, no?

Adam Lashinsky: They are talking about a social safety net that has been a mainstream idea in this country for over 100 years.

Jonathan Hoenig: Just in case anyone wants to read between the lines, that's French for "socialized health care."

Dagen McDowell: Adam, time and again politicians muck it up. They try to help save the middle class. They try helping lower-income Americans. They try to go after the rich. Look at the alternative minimum tax. It was designed to hit the rich. Now it hits millions of middle-income Americans. They muck it up. They can't get it right ever.

Adam Lashinsky: I won't argue with you, but Jonathan's response to that would be, ‘well, the government should do absolutely nothing.' I don't agree. We try to do it right. If we muck it up, we try to do it right after.

Terry Keenan: We're a long way from doing nothing. Stuart, we're even hearing plans out of the White House now that the Social Security cap might be raised. And President Bush did not totally take that off the table during his interview with Neil Cavuto this week.

Stuart Varney: Jonathan is also quite right. It's not just the Left. There are problems on both sides of the aisle. The bottom line is that taxes are going to go up.

Terry Keenan: How do you protect yourself?

Stuart Varney: Here's what I think. I think that we've come to the end of an era of wealth creation. We are in a new era of wealth redistribution. I don't like it. But I think that's the political and economic reality we face: slower rates of growth for the economy in the future and a stock market that will not maintain these highs.

Dagen McDowell: Another way to fix the entitlement programs is to dial back some of the benefits in addition to hiking taxes.

Jonas Max Ferris: The president is putting that forward. It's probably not going to go anywhere. Cutting back some of the benefits. Right now people make $160,000 and get government health care in some cases. One in four people currently get some kind of government health care. So to say we don't have socialized medicine is a little ridiculous anyway. The president and the Republicans had a lot of time to fix that and they didn't. So you can't blame all this on the far-left trying to make a socialist state out of the country.

Charles Payne: I have to tell you, there's not a lot of difference from what I'm hearing from the Nancy Pelosis of the world and from what I'm hearing from Hugo Chavez. You close your eyes, it feels like the same thing to me.

Dagen McDowell: She is not taking over your neighbor's business, the last time I checked. Come on.

Charles Payne: Our neighbor's business is going to go out of business. They want to raise the minimum wage, which is great, but they don't want to give benefits to small business owners. There is no give-and-take with this whole Democratic move. It's not logical. Small businesses create most of the jobs in this country. And yet we don't want to give them a break, yet we want to help everyone else. We can't help the little people and small wage earners in this country by just taking from the rich. There are a lot of other things that have to be done.

Terry Keenan: Jonathan, do you agree with Stuart that we're at a point of change where we're moving to a point of redistribution in wealth?

Jonathan Hoenig: I do, Terry. There is a reason why poverty wages in America are still more than the average wage in China or why people live 10 percent longer here than in communist North Korea. It's because we're capitalists and, unfortunately, we're moving in the wrong direction.

Cashin' In: A "Hugo" Problem?

Well, who needs to vote when you have Hugo Chavez in charge? Venezuelan dictator Hugo Chavez giving himself the power to make laws by decree, which could mean some big trouble for many American companies. Neil Cavuto asked President Bush about the situation in an exclusive interview:

(BEGIN VIDEO CLIP)

Neil Cavuto, FOX News Channel managing business editor: Hugo Chavez in Venezuela is going to be taking over a lot of businesses by the end of the week. He will effectively be a dictator. And you have urged that U.S. companies affected be compensated. And if they are not?..

President George W. Bush: Well, it's a hypothetical. My worry, of course, is that the nationalization of industry will make it harder for the Venezuelan people to be lifted out of poverty, make it harder for the people to realize their full potential. I'm concerned about the Venezuelan people. And I'm worried about the diminution of democratic institution as well as nationalization efforts that may or may not be taking place.

(END VIDEO CLIP)

Terry Keenan: Well, would Americans take pain at the pump if it hurts Hugo Chavez?

Adam Lashinsky, Fortune Magazine: I think Americans would and should. We showed last year that we, as an economy, could tolerate higher gas prices. I think it's more of a concern that Chavez may cut us off before we cut him off.

Terry Keenan: Stuart, wouldn't higher oil prices just help this guy?

Stuart Varney, FOX Business News: I want to beat up on this nasty dictator. I don't think the way to do it is to boycott his oil. We need to get the price of oil down. And the way to do that is to drill for the oil that we have on American territory.

Dagen McDowell, FOX Business News: You get oil prices down by cutting our consumption. You cut our consumption by taxing gas. That is exactly what you do.

Stuart Varney: You get oil prices down by raising the supply of oil.

Dagen McDowell: Do both: cut our demand and make Chavez pay.

Terry Keenan: Jonathan is beginning to have a coronary because of these suggestions.

Jonathan Hoenig, Capitalistpig Asset Management: Terry, I look at Hugo Chavez and I see Germany, 1933. I think if you're watching this and in Venezuela, get the hell out now because you have to be deaf, dumb and blind to not know that this guy is major trouble. He's a jerk. What worries me is that he's getting in bed with our biggest enemies. He's a buddy with Ahmadinejad. He's "BFF" with Kim Jong Il. What are we going to do? This guy is eventually going to be a military threat. That's what I'm worried about. Not the price of gas.

Terry Keenan: And keeping Cuba afloat now that they don't have the Soviet Union to do it for them.

Charles Payne, Wall Street Strategies: The bottom line is, though, that we don't boycott them. If it's military, we take a different course of action. He needs a scapegoat. This is going to fall apart. Just look at what happened to Cuba. It's just a matter of time. If we do something to help it, we will always be a scapegoat and he'll always say it's a devil. Isn't he such a hypocrite to do so much business with the devil? 14,000 Citgo stations here, $37 billion dollars a year. Yeah, he really likes the devil a lot, doesn't he?

Jonas Max Ferris, MAXfunds.com: I completely don't agree with the west coast on this show. They would go to Citgo to save two cents over an Exxon Mobil across the street. That's the way Americans are and that's the way it is. But look, let me also say something else. In Venezuela and Venezuelan people, forget the nutty leader, they love American products. The number one selling car in this country is G.M. The number one car in America is Toyota. You don't want to boycott and start a trade war with a very good customer of the United States. They are very good customers of America right now.

Terry Keenan: And the Venezuelan people are suffering under this guy.

Stuart Varney: Yes, they are. I think Jonathan makes the allusion that it's like the 1930's. I think it's like being in Cuba in 1959, because you can see what's coming down the pike in Venezuela. It is going to happen.

Terry Keenan: Do you think we'll see a mass exodus of people out of that country?

Stuart Varney: Yes. The middle class will leave Venezuela in droves.

Dagen McDowell: If we can figure out a way to take away his oil wealth, the people will rise up against him and he will fall, because he won't have anything to spend. He needs spending money.

Stuart Varney: But the way to do that is to get the price of oil in the world market down.

Dagen McDowell: By cutting our consumption. Hello?

Terry Keenan: To either point, Adam, it isn't a coincidence that these radical leaders have sprung up in oil-rich countries like Iran and Venezuela as the price of oil goes to $78 a barrel.

Adam Lashinsky: Of course not. They're stealing from their own people; they're enriching themselves with the high price of oil. We don't need to do much. Chavez is an annoyance to us. Fortunately, Jonathan, I think your analysis about him is right, Venezuela is not Germany and it's not going to be a huge threat to the United States. Of course, we will need to keep an eye on them militarily. But Chavez is not going to attack the United States, the devil.

Cashin' In: Cla$$ Warfare In 2008?

2006 was about the Iraq war. Will 2008 be about class warfare?

New York senator Charles Schumer has a new book in which he literally makes up a fictitious American family struggling to get by. Is this strategy to get back the White House going to work in 2008?

Jonathan Hoenig, Capitalistpig Asset Management: Terry, I don't know. But class warfare is always at the heart of every Democratic message. Whether it's John Kerry and the "Benedict Arnold" CEO's or John Edwards' bid to America or Chuck Schumer who told The Washington Post that free trade doesn't work. They believe that it's their job to redistribute the wealth from those who've earned it to those who haven't. To be honest, I find it immoral. I think it's wrong to treat people not as individuals but as members of this or that, racial or socioeconomic group.

Terry Keenan: Isn't it a little telling that Chuck Schumer has to make up a fictional middle class family to make his point?

Stuart Varney, FOX Business News: Fair point. I will go further than Jonathan. I will say that this is going to be a winning strategy for the Democrats in 2008.

Terry Keenan: Even with oil prices coming down, housing prices holding steady?

Stuart Varney: It's a winning strategy. Class warfare failed in the past. It will win in the future.

Dagen McDowell, FOX Business News: No way, Stuart. It has failed in the past.

Stuart Varney: You can't lecture an Englishman about class warfare.

Dagen McDowell: I can lecture about one thing about the American way of thinking. We strive to do better, to rise to a higher place, to work hard and make more money. And that's why I don't think class warfare works, because people who are middle class want to be rich.

Charles Payne, Wall Street Strategies: This is interesting. You know what: you can argue that the middle class has struggled. You can say from day one. It depends on what you mean by struggle. The way I was raised, you were thankful for what you got and what you have and then you try to achieve more. I think the American people have so much. People have 50-inch TV's, sneakers, and everybody's driving around. We are not as down and out and poor as the Schumers of the world try to make us out to be. People aren't struggling hand-to-mouth.

Terry Keenan: You're saying our expectations have been raised?

Charles Payne: We want more. We probably want two plasmas instead of one, but Americans are doing very well. There is shortness in the gap between the superrich and middle class. To portray us as such a down-and-out country is really pathetic.

Jonas Max Ferris, MAXfunds.com: Didn't the White House invent a family to prove why the estate tax ought to be repealed? One of Schumer's big points in the book is lowering the property tax. You can debate why his property tax in the state of New York is the highest in the country, but the reality is that property taxes are the things that people with big, expensive houses pay. That's not giving money to the poor, that's saving money if you own a "McMansion". I don't even see this as being the old school redistribution of wealth that Jonathan is talking about, anyway.

Jonathan Hoenig: Everyone wants to be rich.

Terry Keenan: Does it sell, though? Does it sell to the voters?

Jonathan Hoenig: No. What sells is packaging up benefits and selling them as rights. Saying to someone, "hey, you have a right to health care. You have a right to education. Doesn't matter if you've smoked a pack a day your whole life, you have a right for society to pay for your welfare and health care no matter how much it costs." That's the heart of their message. That's immoral at its face.

Best Bets: "$uper" Party Picks

(If you want to hear what each panelist had to say about their stock pick, click here.)

Score big with some Super Bowl party picks in our Best Bets.

Jonathan's "$uper" Party Picks: Performance Food Group (PFGC)
Friday's close: $29.74
52-wk high: $33.45
52-wk low: $23.30
YTD Return: +7.6 percent

Jonathan Hoenig, Capitalistpig Asset Management: Performance Food Group. It's a billion dollar company that distributes food all over the country. The stock has a bid here and it's really is not on a lot of investors' radar screens. I don't own it in my hedge fund, but we're looking at it. I've been impressed with the strength of this stock.

Terry Keenan: You like these food companies or, at least, you look at them a lot, Jonas?

Jonas Max Ferris, MAXfunds.com: It's under everyone's radar screens because SYSCO is dominant and they're never going to catch up and beat that company. This business is basically wrapped up.

Jonas' "$uper" Party Picks: RadioShack (RSH)
Friday's close: $22.38
52-wk high: $22.68
52-wk low: $13.73
YTD Return: +33.4 percent

Jonas Max Ferris: RadioShack. People don't realize you can have a regular antenna and get the Super Bowl in HD. You don't even need to pay the cable and people don't even know this. They go for these antennae as an impulse buy, small box retailers like RadioShack; that's their bread and butter. Batteries and stuff like that. Not a "big box" place.

Terry Keenan: You'll buy the rabbit ears, for your $3,000 TV!

Jonas Max Ferris: It works. It's amazing.

Charles Payne, Wall Street Strategies: It's not a well-run company, but the stock is cheap down here.

Charles' Pick "$uper" Party Picks: Revlon (REV)
Friday's close: $1.49
52-wk high: $3.75
52-wk low: $0.76
YTD Return: +16.4 percent

Charles Payne: I'll go a little contrarian. I'm going to Revlon. Talk about a company that has not been well run, but they are the only company running commercials aimed at women. Unilever (UL) is not running commercials, Proctor & Gamble (PG). They've got a new hair-coloring product, it's a dollar stock, you know?

Terry Keenan: The problem is that their ads are great but their products are generally terrible.

Charles Payne: And I think management has to be somewhat terrible as well and I add the caveat that it's risky.

Jonathan Hoenig: Dollar stocks are usually a dollar for a reason, Terry, and many do go to zero. I think it is a dying swan; somebody has to put it out of its misery. It's not on my list.