This is a rush transcript from "Your World With Neil Cavuto," June 29, 2010. This copy may not be in its final form and may be updated.

STUART VARNEY, GUEST HOST: President Obama today ramping up his push for a climate bill, the president meeting with more than a dozen senators to rally support for a plan that includes a tax on carbon.

Senator Jon Kyl saying some liberal Democrats are looking at changing filibuster rules to make it easier to ram through bills like that.

My next guest not surprised. Senator James Inhofe is a Republican from Oklahoma.

Senator, welcome back. Always good to see you.

SEN. JAMES INHOFE, R-OKLA.: Well, it’s good to see you.

VARNEY: If they really did change the rules on a filibuster so that you didn’t need 60 votes in the Senate to pass a major bill, you could ram through a new energy climate change bill.

INHOFE: No, you — I don’t agree with that, Stuart.

Last time we talked, I mentioned that cap and trade is dead. But the irony that they, the Democrats, would talk about doing away with the filibuster rule right after the dean of the Senate died, that was — the last protector, Bob Byrd, just died, and they want to do that.

It’s not going to happen. Keep in mind, Republicans are going to take control of the House and Senate in the next election, so then that wouldn’t really serve them too well, would it?

VARNEY: OK. Let’s focus on what they’re calling this new climate bill. There was a meeting today in the White House, as you know.

I’m reading this as shorthand. If anything happens, it is essentially a rise in the price of electricity and gas at the pump. Do you agree? Now, my question is, do you think it will happen?

INHOFE: No, I don’t, Stuart.

Let me tell you what — right now, the irony they would be even talking about that — we have the Kagan nomination. We have Petraeus. We have the worst oil spill in history, and they are having a bunch of moderate Republicans over trying to sell them on cap and trade.

It’s not going to happen. But I think their strategy — and this is something to be watching for — they want to pass anything. It doesn’t matter what. And if they can send it to conference — and they would have a conference with Waxman and Markey — then that’s their whole strategy, and maybe come back in a lame-duck session, after a bunch of those guys have lost, and try to pass it then.

I just don’t think it can happen. And, quite frankly, even without the filibuster rule, I don’t think — as I said last time we talked, cap and trade is dead. And the reason I say that, Stuart, is that all the way back to the can Kyoto treaty, then, of course, the McCain-Lieberman bills, and the Warner-Lieberman bills, every time they try cap and trade, people are reminded by me and by others it would be the largest tax increase in history.

The Waxman-Markey bill price tag would be about $350 billion a year.

VARNEY: Yes.

INHOFE: And I can’t think of very many Democrats who want to go back to their states and say, aren’t you proud of me? I passed the largest tax increase. The numbers aren’t there. They are not even close.

VARNEY: But couldn’t you narrow this down and make it just an anti-big oil bill, take money off the oil companies, take money off the — off that particular industry, and say we’re going to use this money to clean up the spill; we’re going to use this to bring on alternate fuels, wind and solar, and sell it on that basis, anti-big oil?

Because they’re — Senator, there is a very strong anti-oil feeling in this country at the moment.

INHOFE: Well, there is, Stuart. And it’s understandable that there is, but they have been trying to use that now.

Let’s keep in mind it was only a week ago that they had the bill to do away with all production in America. And that was the one that Bernie Sanders had that we defeated. So, yes, they will try to do that.

But the bottom line is, they want to get to a cap and trade. And even in today’s meeting, they talked about we have to put a price on carbon. If they put a price on carbon, they can’t do it with a clean tax, because then people would know how much it costs.

So, I don’t think — I think they’re in denial right now, Stuart. It’s not going to happen.

VARNEY: I thought that the word climate, that the very word climate, when attached to any piece of legislation, was just out the door. You don’t use that word any longer, because it doesn’t resonate with the public.

And cap and trade, as you suggest, that’s got a bad name, too. I thought they would keep that completely out of everything and just focus on let’s beat up on oil. I thought that’s the way they would go. And I thought there might be some support for that.

INHOFE: I think they will try to do that.

Let’s keep in mind, even John Kerry said, cap and trade, I don’t even know what it means.

And, so, they’re clearly trying to change their language around to find something that can be sellable, something they can put in conference with Waxman-Markey.

But, again, the votes are not there and people — people now know what the issue is. And they’re going to have people like me saying, look, this is cap and trade again, and the votes aren’t there.

VARNEY: Can you...

INHOFE: I don’t think they have more than 24 votes right now.

VARNEY: We have just seen — a separate subject for a second, Senator, if I may. We have just seen a major decline on the stock market and there’s all kinds of talk about a real crisis of confidence, not just in the president’s policies on the economy, but also among consumers.

You’re the senator from Oklahoma. Can you assess how your people are feeling right now about the current state of the economy and where we’re going?

INHOFE: Well, I’m really the wrong person to ask because, in my state of Oklahoma, things are doing very well right now. We have gone through a recession, and we were — we’re no longer a one-issue state. And so things are going well right now. The confidence is up much, and the spirits are up. I can’t speak for any other state, but things are pretty well right now.

VARNEY: Just let me turn this around for a second. So far, we have just looked at energy policy short-term, energy bills short-term.

Look to the longer-term, if you would. Do you think it’s likely that we will come at some point to have to take or leave a gas tax hike as the simplest and easiest way of generating revenue for the federal treasury? It’s going to come to that, isn’t it?

INHOFE: Well, the problem I have with that is, it’s what they really want to do with that. They want a gas hike. They want to do away with fossil fuels. They don’t want oil. They don’t want gas. They don’t want coal. Of course, they don’t even want nuclear.

But — and since Nancy Pelosi — now, it took her six months, but she knows that natural gas is also a fossil fuel. That’s what they’re really trying to get to. And how do they get there? They put a price on it. So, when you put a price, raise the gas price, that’s also a price that they’re raising on — on — it’s another cap and trade.

VARNEY: OK.

Senator James Inhofe, always a pleasure. Thank you very much for being with us again, sir.

INHOFE: Thank you, Stuart.

VARNEY: Thank you, sir.

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