This is a rush transcript from "Your World with Neil Cavuto," June 4, 2008. This copy may not be in its final form and may be updated.
NEIL CAVUTO, HOST: Well, gas driving to yet another new record today. Prices at the pump now less than 2 cents shy of 4 bucks a gallon. Gas is up 31 percent since the start of the year.
And forget the pain you're feeling at the pump right now. Some say the prices could double if a climate security bill being debated right now in the Senate is approved. It seeks to slash greenhouse gases by 66 percent.
And a first on FOX, the sponsors of that bill, Senators John Warner and Joe Lieberman.
Senators, welcome to both of you. Thank you for coming.
SEN. JOSEPH LIEBERMAN (I), CONNECTICUT: Thank you, Neil.
CAVUTO: Senator Lieberman, if I can begin with you, many have argued that, while this has good merit, it's coming at a bad time. We're paying through the nose at the pump. Utility bills are driving a lot of folks nuts. And now you're introducing legislation that could drive those prices up all the more.
What do you say?
LIEBERMAN: Well, first, the bill does have merit. And I appreciate your referencing that. It's got a purpose. It is to reduce the carbon pollution that is causing global warming. And that's a responsibility we have to future generations of Americans.
But, second, the run-up in gas prices is not caused by our bill. The gas prices has gone up 82 cents a gallon since the 1st of January. The fact is, that, if this bill passes, at most, gas prices will be increased by 2 cents a gallon a year. But what's more important is, that money will be reinvested in the kinds of new technologies, new fuel systems, electric cars, hybrids and biofuels, all the rest, that actually will reduce the demand for foreign oil, and, I think, as a result, bring down the price of gasoline.
So, our bill, I think, rather than increasing the price of gas, will actually drop it.
CAVUTO: Well, as you know, it's always in the eye of the beholder, Senator.
And, Senator Warner, it's a point I want to raise with you, because the National Association of Manufacturers, a group generally friendly to Republicans, is aghast at your support of legislation they predict will double the price of gas to $8 per gallon.
What do you say?
SEN. JOHN WARNER (R), VIRGINIA: Well, it's a lot of scare tactics.
In the first place, this bill, if it were signed by the president tomorrow, wouldn't take effect until 2012, three-and-a-half years from now. And gas, unfortunately, will have fluctuations one way or another, not as a result of this bill, but many other factors between now and 2012.
So, this is purely a scare tactic.
As a colleague, my good friend and partner said, Joe Lieberman, gas has risen 82 cents this year. And it is not because of the climate change legislation being considered here in the Congress.
CAVUTO: No, but I guess their point, gentlemen — and back to you, Senator Lieberman, on this — is that it's a bad time to propose something like this. Yes, the Earth might need to go green, but we don't need to spend a lot of green to make that happen.
And some are saying that, over the years, this will be a multitrillion-dollar boondoggle. And on a day, Senator Lieberman, you have Democrats proposing a $3 trillion budget that takes away a lot of the president's tax cuts, is this just lousy timing?
LIEBERMAN: I don't think so, Neil, because the fact is, we have got a problem. And the carbon pollution that`s gone into the atmosphere up until now doesn't evaporate. It stays there. Some global warming is inevitable.
Every — all the experts tell us that, the sooner we act on this, the better. And you can't — this is a bill that will go for 40 years. It's methodical. It doesn't mean to shock our system. It means to slowly wean us off of carbon-polluting fuels.
And I think John is right. You've got to think of it as three-and-a-half years before this takes effect, plenty of time for our economy to recover, hopefully for gas prices to go down, and to be ready to do this.
But let me ask you, to that point, Senator Lieberman, has Al Gore talked to you about this? Because I know you guys kind of had this little agita thing going.
Now, on this, are you in simpatico, or what?
LIEBERMAN: Yes, I would say we're simpatico. I think, in this regard, I took some antacids to remove the agita.
LIEBERMAN: No, you know...
CAVUTO: All right.
WARNER: He came and testified before our committee.
You remember that, Senator.
CAVUTO: That's right.
LIEBERMAN: That's right.
And I think he's happy with this legislation. Frankly, he would like it to be a little more aggressive.
But John and I have put together what we consider to be a middle-of- the-road, balanced approach to this. I hope it will be adopted.
Senator Warner, there are a lot of U.S. business interests and the like that have contacted me, both on Fox News Channel and Fox Business Network, saying — you notice how I got the plug in for the latter, gentlemen — saying that...
LIEBERMAN: Good work.
CAVUTO: ... this is bad for business here, that utilities, for example, American utilities, would bear the overwhelming cost of this, and they can't afford it. And neither can their customers, and that they just wonder why in your case, Senator Warner, someone who has been a friend to business, understood the costs for business, would sign on to something that they say is going to hurt business.
WARNER: Well, let's start with the following.
We, Joe and I, put in a provision in the bill that the president of the United States, not George Bush, but the next president and the next president and the next, have got their hand on the throttle on this bill.
If they see any damage coming as a consequence of higher taxes, higher prices at the gas pump, technology that can't keep pace with the need to get clean-coal technology, he can pull back on that timetable. But it's important that America at least get a start. We're lagging behind much of the rest of the world. And the world is looking to the United States for leadership.
So, Joe and I have just got the right bill to move, I think, at a good time, get it out. And it is going to be three years, a full three years, before it would have any impact on the economy.
CAVUTO: Well, there's quite an expensive adjustment to get to that three years, though.
So, leaving that aside, Senator Lieberman, I do want to raise with you this whole budget issue going on right now, because this — I know you're saying that it's, long term, cost effective, but we do have this issue of Democrats approving a budget plan today that would wipe out the president's tax cuts, by and large.
How do you feel about that?
Well, I would say, very briefly, I have said that the higher-end tax cuts that the president adopted, we really can't afford anymore because of the cost of our involvement in Iraq and Afghanistan and needs that we have here at home. Also, I want to get our government back in balance, so we can strengthen the dollar again.
But, you know, a lot of those other tax cuts...
CAVUTO: By the way, does Senator McCain share that view, Senator Lieberman?
LIEBERMAN: Well, you — no, I don't think so. You have to ask him. I think he favors a strong dollar and he favors a balanced budget, but he wants to see all the Bush tax cuts extended.
CAVUTO: But he — you're a very good friend of his. He loves you to death. Has he ever told you, look, truth be told, Senator, I don't think these — these tax cuts that went into effect for the upper income can hold until eternity? Has he ever told you that?
LIEBERMAN: No, he hasn't. And I think what he's said to me is what he's said publicly...
LIEBERMAN: ... which is the way John McCain is, which is, if you repeal these taxes, it will be experienced as a tax increase, and that will be bad for our economy right now.
So, look, we don't agree on everything, even though we`re the closest of friends.
LIEBERMAN: And that`s part of what I think were saying. You have got to work across party lines...
LIEBERMAN: ... with — with somebody else to get things done.
CAVUTO: Very quickly, Senator Warner, do you think prices — gas prices — are rigged right now?
WARNER: I don't think anyone has a clear answer. Good question — no clear answers.
WARNER: Just why these prices have skyrocketed, we know not. But we want less dependence here in the United States on imported petroleum products. That's for sure.
CAVUTO: All right, gentlemen, I want to thank you both. Always good having you.
LIEBERMAN: Thank you, Neil.
CAVUTO: All right.
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