Transcript

What can we expect from new era of Iran-US relations?

Ambassador Dennis Ross, former Middle East advisor to Obama, weighs in

 

This is a rush transcript from "Sunday Morning Futures," January 17, 2016. This copy may not be in its final form and may be updated.

MARIA BARTIROMO, FOX NEWS ANCHOR: A new era for relations between the United States and Iran, coming with a swap of prisoners and the release of billions of dollars.

Hi, everyone. I'm Maria Bartiromo. Welcome to SUNDAY MORNING FUTURES.

U.S. and European Union officials saying Iran has followed the rules of the nuclear deal. But they promise to re-impose sanctions if that changes. A former White House Middle East coordinator will react in moments.

Plus, your money plummeting as stocks see their worst ever beginning to a year. What does it say about the economy and your money? A leading economist Mohamed El-Erian joins us to navigate these markets.

And, is the Republican race for the White House shaping up as a two or three-man race? RNC spokesman Sean Spicer on the party's outlook going into Iowa, as we look ahead this morning on SUNDAY MORNING FUTURES.

(MUSIC)

BARTIROMO: Four Americans have now left Iran, according to the State Department, in exchange for seven Iranians. That is the bargain struck between the U.S. and Tehran, to bring our citizens home.

The group includes "Washington Post" reporter Jason Rezaian, the exchange for him -- in exchange, the U.S. will free seven Iranians accused of violating sanctions against Iran.

Secretary of State John Kerry says the nuclear agreement helped facilitate the swap, saying that Iran met the terms and is poised to receive $150 billion this upcoming week. That money, of course, was frozen under economic sanctions.

(BEGIN VIDEO CLIP)

JOHN KERRY, SECRETARY OF STATE: Today marks the first day of a safer world. One where we believe it is possible to remain safer for years to come and particularly with the compliance of this agreement.

(END VIDEO CLIP)

BARTIROMO: I want to bring in Ambassador Dennis Ross, former special Middle East coordinator for the Bush and Obama administrations. He's the author of "Doomed to Succeed: The U.S.-Israeli relationship from Truman to Obama," and a FOX News foreign affairs analyst.

Sir, good to have you on the program. Thanks so much.

AMBASSADOR DENNIS ROSS, FORMER WHITE HOUSE SPECIAL MIDDLE EAST COORDINATOR: Nice to be with you.

BARTIROMO: Your reaction to the swap.

ROSS: Well, look, I think this swap is an indication that the United States and Iran actually do have diplomatic channels now that they haven't had before. I hope it's not a precedent in the sense that the Iranians grabbed people who are completely innocent and they then are able to trade them for people who we have in jail for having committed crimes, in this case, these are six of seven people were Iranian Americans, who had been involved with trying to break sanction regime by smuggling materials to Iran.

BARTIROMO: When are you expecting Iran to get this money, $150 billion? This upcoming week?

ROSS: Yes. I mean, these are frozen accounts. Of the $150 billion, probably at least half of that they already are obligated in terms of debts to the Chinese and others. But you're looking at $75 billion to $100 billion in terms of real money that the Iranians will now have access to.

And while most of that, I suspect, will be used for domestic purposes, hard to believe that at least 5 percent to 10 percent of it won't go to Hezbollah and other Shia militia groups.

BARTIROMO: Right. So, that's what I was trying to say. How likely is it that some of this money goes directly to support terrorism?

ROSS: Very high probability for one simple reason. The supreme leader, Ali Khamenei, wants to demonstrate that his resistance, what he calls resistance ideology is still valid. Having done a deal with us, he wants to prove that hasn't changed Iran's outlook in the area or their aims to try to dominate the region.

BARTIROMO: Yes. Ambassador, stay with us. A lot to talk about with you this morning.

But, first, we want to dig deeper to see how Iran will benefit from both the controversial prisoner exchange and the executive order to lift those sanctions.

FOX News senior correspondent Eric Shawn with that angle.

Eric, good morning to you.

ERIC SHAWN, FOX NEWS SENIOR CORRESPONDENT: Good morning, Maria, and good morning, everyone.

Thankfully, some of our fellow Americans are now free. But in this controversial swap and deal, Iran does get the $150 billion with really no strings attached. And some critics say the possibility of building a nuclear bomb anyway in 15 years.

(BEGIN VIDEO CLIP)

JOHN KERRY, SECRETARY OF STATE: While we welcome implementation day, we understand that this marker alone does not wipe away all of the concerns that the international community has rightly expressed about Iran's policies and actions and choices in the region.

(END VIDEO CLIP)

SHAWN: With the prisoner nuclear deal now done, Iran can rejoin the international financial system. Would that really make Tehran change its behavior?

The U.N.'s International Atomic Energy Agency says Iran is so far complying with the nuclear agreement.

(BEGIN VIDEO CLIP)

FEDERICA MOGHERINI, E.U. FOREIGN POLICY CHIEF: U.N. sanctions related to Iran's nuclear program are lifted.

(END VIDEO CLIP)

SHAWN: Well, under the deal, the European Union has ended its oil and banking sanctions, while the U.S. has ended some sanctions except those on Iran's ballistic missile program, U.S. banks are still prohibited from doing business there. But foreign subsidies of U.S. companies can now operate in Iran.

Iran also gets access to the SWIFT electronic banking system. You know, that connects almost 10,000 banks in more than 200 countries. And they say $50 billion will be available immediately to Iran.

Critics say this is far too much.

(BEGIN VIDEO CLIP)

DR. SEBASTIAN GORKA, MARINE CORPS UNIVERSITY: This is a propaganda coup for the mullahs, the bad guys, the people who want to destroy us, the, quote-unquote, "Great Satan". This is a total win for the Iranians.

(END VIDEO CLIP)

SHAWN: Well, Iran has announced that it will use the first windfall from the sanctions money to buy 114 Airbus commercial airliners. Note, they're purchasing from the European consortium, not Boeing, an American company.

This is as another American businessman is still being held in Iranian hands, and yet, another former FBI agent Robert Levinson remains missing after a decade -- Maria.

BARTIROMO: All right. Eric, thanks very much. Eric Shawn with the latest.

More now with Ambassador Dennis Ross. What about the other people that are still being held by Iran, Ambassador? Mr. Levinson, do we know anything about their whereabouts and whether or not Iran will set them free?

ROSS: In the case of the businessman, his name is Namazi, he is also a dual national. And there is talks about having him freed at some point. He's kind of a cautionary note, I think, for anybody who wants to go do business there. There is the possibility that those who are related to the hard-line clerics, the Revolutionary Guard, who may not be so enthusiastic about the deal, particularly because the Revolutionary Guard in Iran dominates about 30 percent of the Iranian economy and they have been able to do that mostly because of the sanctions.

BARTIROMO: Right.

ROSS: Now with sanctions being lifted, you may have others, more the private sector who can begin to emerge, so they may try to make things difficult by grabbing people like Namazi. We'll see if he gets released or not.

In case of Robert Levinson, he's a former FBI agent. The Iranians say they don't know anything about him. They make commitments to trying to learn more about him. I think here is someone who they continue, clearly they have not revealed -- they have not revealed a lot of what they know about him. And I think are a lot of question marks about that.

BARTIROMO: A lot of question marks about all of this. I mean, isn't it interesting that as Secretary of State John Kerry is there saying this is the safer day right now, I don't know how he comes to that conclusion, many Middle Eastern countries are following Saudi Arabia's lead and cutting ties with Iran.

Was there any way this deal in terms of this $150 billion that is going to be freed up for Iran, was there any way going into this week this could have been stopped?

ROSS: No, I don't think so. I mean, the truth is the deal all along was supposed to be a rollback of Iranian nuclear infrastructure and a return for a rollback of sanctions. And so, any deal, a deal that would have been more successful in terms of rolling back the nuclear infrastructure further would have provided that for the Iranians. So, they were going to get this kind of sanctions relief.

BARTIROMO: Even though we know they have been ongoing with the ballistic missile program, illegally?

ROSS: Well, and that violates -- that did violate an existing Security Council sanction.

BARTIROMO: Right.

ROSS: And a resolution.

The fact is that there will be -- there is a new resolution that was adopted to replace the earlier resolutions as part of this deal. That's part of what implementation day represents. It means there now is a new Security Council resolution that replaces the previous ones, it means as well that there is a sanction relief and they have access to this money.

I would suggest one thing, we know -- we're able to track very well what kinds of money are going to Hezbollah from the Iranians. I hope that we would be prepared to adopt new sanctions if we see a surge in monies going to Hezbollah. And I hope that we would be prepared to adopt new sanctions if we see a surge in monies going to Hezbollah.

If the Iranians really want to use the monies to improve domestic infrastructure, that's one thing. If they want to use it to go ahead and destabilize the region further by supporting Hezbollah, other Shia militias that are their instruments in the region, then there ought to be increased -- there ought to be a price for that.

That I think is important for us also because the more the Iranians know there is a price for bad behavior, the last incentive they're going to have to cheat on the nuclear deal as well.

BARTIROMO: Hard enough to get the sanctions even -- even pulled back, even while they were breaking this agreement with that program.

Ambassador, thank you. We appreciate your time this morning.

ROSS: My pleasure.

BARTIROMO: The Iowa caucuses are coming up fast with the New Hampshire primary on its heels. What then is the state of the race this morning? The Republican National Committee's communication director Sean Spicer will join me next to talk about it.

We'll also get the RNC reaction to the Iran deal.

Follow me on Twitter @MariaBartiromo, @SundayFutures. Let us know what you would like to hear from Sean Spicer. We're looking ahead this morning.

And then, we're talking about your money with Mohamed El-Erian on SUNDAY MORNING FUTURES.

(COMMERCIAL BREAK)

BARTIROMO: We have FOX News alert right now: President Obama will deliver a statement on the Iran nuclear deal and prisoner exchange. That's happening at 10:45 a.m. Eastern this morning. We'll bring you to it when it happens live.

Meanwhile, hot off Thursday's no holds barred debate, the GOP presidential candidates making their cases to voters with just two weeks to go until the Iowa caucuses. Here is a moment from that debate. Voters especially here in New York can't seem to get off their minds.

(BEGIN VIDEO CLIP)

BARTIROMO: Senator Cruz, you suggested Mr. Trump, quote, "embodies New York values." Could you explain what you mean by that?

SEN. TED CRUZ, R-TEXAS, PRESIDENTIAL CANDIDATE: I think most people know exactly what New York values are.

There are many, many wonderful, wonderful working men and women in the state of New York. But everyone understands that the values in New York City are socially liberal, are pro-abortion, pro-gay marriage, focused around money and the media.

(END VIDEO CLIP)

BARTIROMO: Let's talk more about it with Sean Spicer. He's the RNC communications director.

Sean, good to see you. Thanks so much for joining us.

SEAN SPICER, RNC COMMUNICATIONS DIRECTOR: Good morning.

BARTIROMO: I want to get to that in a moment, that exchange and your highlights from your standpoint from the debate. But, first, let me begin on Iran, Sean. What is the RNC's reaction to this prisoner swap and this Iran deal which opens up $150 billion for Iran tomorrow?

SPICER: Well, I think it is not just an RNC response. I think our response is probably the same response as a lot of Americans, a lot of scholars, diplomats, which is it is great to have the five individuals free from Iran, hoping they get back on U.S. soil as soon as possible. So, we all cherish that as Americans seeing our fellow citizens freed and back here hopefully very soon.

But I think there is a lot of concern over the price that was paid and the way it was done. I'm not sure Iran has got the strongest record when it comes to actually following through on their promises. And I think the price that we paid, what we have given them in terms of access to these funds, to the banking system, to a lot of things that Eric Shawn enumerated in the package that you ran earlier are of concern to a lot of people and a lot of Americans.

I think the haste to get to a deal and the price that we pay is going to be concerning to a lot of lawmakers, to a lot of our candidates running for president.

BARTIROMO: Yes.

SPICER: But I don't think, Maria, it is a partisan thing. I think you heard now over and over again diplomats and scholars, very, very -- expressing deep concern about this.

BARTIROMO: Yes, for sure, Sean. I want to say that Donald Trump is tweeting right now, live. And he says, "In the Iran deal, we get four prisoners, they get $150 billion, seven most wanted and many off watch list. This will create great incentive for others."

So, there is one reaction. What are your takeaways, Sean, from the debate? Who won and who lost?

SPICER: I think that the American people won. The viewers won. Republican activists won.

I think you, Neil, Sandra and Trish did a phenomenal job as you did in Milwaukee. I'm not just saying that because I think what happened and we have seen the consequences with like a CNBC debate that wasn't focused on the issues, people came away with a deeper understanding of the candidates, their vision, their tone, and so to your earlier clip, between Senator Cruz and Mr. Trump, I'm not had here to call balls and strikes, but to those who agreed with senator Cruz and how he handled it, they got to see more of his view, his vision, his values.

I think to those who liked Mr. Trump's response to the way he answered it, that's good. It was a very healthy dialogue. I think people got to learn more about the candidates and the way they would approach the job as president of the United States.

BARTIROMO: Thank you for that. And I will say it was truly an honor to be part of it from my perspective and I do feel like we drilled deeper in some of the issues that are important to the American people.

One of my favorite exchanges actually was about tax reform, Sean, because we went through the different tax plans. We're going to have Art Laffer on in a few minutes and he'll talk to us about what plan is the growth plan.
But you also had them talking about taxes with regard to all these companies trying to leave America and get better tax rates, higher corporate tax in the world.

So, that was one issue that I agree we were able to inform viewers.

SPICER: Right. And you talked about corporate inversion. The Democrats offer a starkly different contrast and they sort of don't understand the money that U.S. companies have trapped overseas because of our arcane tax laws and policies.

BARTIROMO: Right.

SPICER: I think the idea that each one of those individuals up there talked about why it is important to bring funds back, how it impacts job creation, innovation, expansion, economic growth is in stark contrast to what people are going to read that happen tonight with Bernie Sanders, and Hillary Clinton and Martin O'Malley trying to distinguish themselves and tumbling further to the left.

BARTIROMO: Yes.

SPICER: So, I do think that the idea of actually getting into, as you mentioned, the tax plans and the different challenges that we face economically is important because, right now, there are people who are tired of what is going on in Washington. They may have a job. But they're worried that their job is going to be there, and they're not seeing the growth they have seen in the past.

BARTIROMO: Right.

SPICER: I think it was a very, very issues-focused conversation.

BARTIROMO: So, you got the Democratic debate tonight. You got another RNC debate end of January. What is most important as we go into Iowa February 1 and then followed by New Hampshire?

SPICER: Well, I think just from an analyst standpoint, if you take off all the partisan stuff, I think in both parties, it's who going to show up because I think in Bernie Sanders' case, he's really feeling -- people are feeling that Bern, if you will. And Hillary Clinton, if she loses the first two states, it's not just trouble for her, but it's entire embarrassment for the Democratic Party to put all their eggs into that basket and said we'll help hide Hillary Clinton, help coronate her, insure that she doesn't get exposed during the primary season.

If Sanders can actually pull out wins in both New Hampshire and Iowa, I think that's going to spell a lot of trouble for her because it's going to question whether or not she has the fortitude to keep going on and I think that most Democrats will agree that if Bernie Sanders is their nominee, there is no way they can win in November.

BARTIROMO: Yes. Great analysis. Sean, we'll see you soon. Thanks so much for joining us.

SPICER: You bet. Thank you, Maria.

BARTIROMO: We appreciate. Sean Spicer there.

Wall Street off to the worst start ever on record as we hit the midway point in January. What can we expect?

A big day this upcoming week, Tuesday, because we got a whole boatload of data from China.

We're looking ahead on SUNDAY MORNING FUTURES at your money, next.

(COMMERCIAL BREAK)

BARTIROMO: Wall Street off to the worst start to a year on record with stocks losing $2 trillion in value since January 1. The Dow Jones Industrial Average dropping almost 400 points Friday alone as oil prices sank below $30 a barrel, that's the lowest price in 12 years.

Investors are nervous about the health of the global economy, so what can we expect in the weeks and months ahead?

My next guest is the author of "The Only Game in Town," due out on January 26th. He's Mohamed El-Erian, chief economic adviser with Allianz SE, and former PIMCO CEO.

Mohamed, always a pleasure to see you. Thanks so much for your time this morning.

MOHAMED EL-ERIAN, ALLIANZ SE CHIEF ECONOMIC ADVISOR: Thank you, Maria.

BARTIROMO: A huge beginning to the year, Mohamed, really nervous investors. To what do you attribute this market meltdown, first?

EL-ERIAN: Two things. One is the global economy is weaker than what people expected. And second, investors realize the central banks no longer have their back covered, the central banks are no longer all together in this policy of repressing financial volatility in order to boost asset prices.

Put the two things together and you get a lot more volatility with a significant downside.

BARTIROMO: In fact, a lot of new worries now that the U.S. is going to go into recession in 2016. I recognize this is a lot about the global story, Mohamed, but how worried are you about the U.S. and whether or not it will enter recession in 2016?

EL-ERIAN: So I do not think a recession is the big case. Yes, there was a risk that financial turbulence could contaminate real economy. But let's not forget that is still an economy that creates a lot of jobs. It is still an economy where there is a ton of corporate cash on the sideline and there's lots of innovations.

The sad thing, Maria, is we're not at escape velocity. We're not at economic liftoff. And therefore our growth is lower than it could be, our wages are lower than it could be. So, there is a lot to hope for, but I don't believe recession is the baseline right now.

BARTIROMO: So, you say we're not really at liftoff, but the Federal Reserve apparently is at liftoff, right? The Fed began to raise interest rates at the end of last year.

Do you think that the Fed is going to raise in 2016 how much, Mohamed, and is that going to sort of snap this economic growth story that's having a hard time getting traction?

EL-ERIAN: So they've told us they're thinking of raising three to four more times their data dependence, so it's conditional. I don't think they'll do three or four. At most, they'll hike twice more and do it very gradually. And they're going to remind us over and over again that this is a very different hiking cycle, a very shallow hiking cycle, will end much lower than history and will be very conditional.

I don't think that on -- by itself, interest rate policy will impact growth that much. What it will do is return us to a more normal level of volatility, and investors have to get used to that. They have been spoiled for the last few years by exceptional policies and now it is time to return to something that is more normal.

BARTIROMO: And the China story is one story that is unnerving people. We get a lot of data out on China Tuesday. Chinese GDP, Chinese retail sales, Chinese industrial production, which gives us that window into really what is going on there.

Why is China so important, should we really be reacting so much to China or is this an overreaction?

EL-ERIAN: It's an overreaction, but an understandable one. China is after all the second largest economy in the world. And we have seen some pretty unpredictable stuff by China, including policy mistakes.

You know, they couldn't make up their mind. They won circuit breakers in the stock market. They designed them badly, so they introduced them and took them away. They lost control of the currency market, that's really uncharacteristic for China.  So, investors are rightly looking at China concerned, but I think we overreact but we overreact because there's other thing that's happening, is that central banks are no longer the market's best friends. So, we will continue to overreact to any negative news.

BARTIROMO: In terms of markets over the near term, would you expect that this continues -- I mean, how should investors be positioned, Mohamed? Are you selling into anything or do you feel that there is opportunity to begin to add to positions?

EL-ERIAN: So you had me on a few months ago and I suggested that what investors wanted to do is have a cash cushion.

BARTIROMO: That's what you said, yes.

EL-ERIAN: That they wanted to be patient, that they wanted to be able to pick up good companies at cheap prices. That is starting to happen. You start to see good companies trade at cheap prices. That's going to continue. So, you want to be overall defensively positioned, but you want to have the agility to pick up good names at bargain prices. And we're going to have that ability over the coming year.

I think the harder thing, Maria, is what do you do if you're fully invested? What do you do now?

BARTIROMO: Yes.

EL-ERIAN: I think if you're fully invested, you want to be cautious, right? Because I think we are in a market that has a downside bias, we could hit a few air pockets.

BARTIROMO: You know, we're going to talk with Art Laffer in a moment about the candidates for the 2016 elections, tax plans. Do you think if we were to see tax reform, Mohamed, that that would be a positive for global markets, certainly for the U.S. market?

EL-ERIAN: Yes, we need pro-growth tax reform. Our tax system right now tends to undermine economic growth. But we also need a few other things to happen as well. I think we need a good debate on infrastructure investment. We need to look at our labor market and how it functions. Too much of the population has exited the labor market. And we need to deal with the problem of student debt, so that issues that we need to deal with. If we do, Maria, we can unleash the potential of this economy and all this cash that is on the sidelines will be deployed productively.

BARTIROMO: Yes, that makes a lot of sense. Mohammed, always wonderful to have you on the program. Thanks so much for your insight.

EL-ERIAN: Thank you.

BARTIROMO: We'll see you soon. Mohamed El-Erian there.

Republican presidential candidates revealing their tax cut plans, the ones which are gaining the most traction and those that are growth plans next with Art Laffer as we look ahead on SUNDAY MORNING FUTURES.

(COMMERCIAL BREAK)

BARTIROMO: Welcome back.

FOX News alert: President Obama delivering a statement on the Iran nuclear deal and the prisoner exchange minutes from now. Stay with us, 10:45 a.m. Eastern. We will bring you the president's comments live and when they happen.

Meanwhile, Republican presidential candidates laid out their tax plans for handling the economy as well in the latest debate on Thursday night. The two candidates whose tax reform plans are being talked about the most are Senator Ted Cruz and Dr. Ben Carson. Cruz's plan includes the highest -- Cruz's is a flat tax and individuals and businesses also have a flat tax.

Carson's plan replaces the tax code with a true flat tax, taxing all income at a uniform 14.9 percent rate.

Art Laffer is the founder and chairman of Laffer Associates and former economic adviser to President Reagan.

Art, always wonderful to see you.

ART LAFFER, FOUNDER AND CHAIRMAN, LAFFER ASSOCIATES: Thank you, Maria.

BARTIROMO: A lot of positive talk about Dr. Ben Carson's plan. I want to start there.

Talk to us about Dr. Ben Carson's plan and why it's getting such rave reviews.

LAFFER: Because it's just an excellent plan. I mean, what you really want to have on taxes, Maria, is the lowest possible tax rate on the broadest possible tax base.

I mean, all taxes are bad, but some are worse than others. So what you want to do is as a tax plan that does the least damage to the economy, and which means the lowest rate on the broadest base and Ben Carson's plan is excellent. I mean, really very good.

Ted Cruz is phenomenal as well and so is Rand Paul. I mean, they're all amazingly good plans. And the --

BARTIROMO: We're looking for really, Art, is which plan leads us to growth. I mean, we're talking about an economy now that is being debated about whether or not it is going to go into recession in 2016.

Is a tax plan and tax reform, let's say, in year one of a new president, is that the kind of thing that moves the needle on economic growth, do you think?

LAFFER: It really moves the needle on economic growth. It really moves it by a lot. But right now, what you're seeing in the campaign and what you're seeing with Ben Carson, for example, is you're seeing these candidates morphing and changing their tax plans to make them fit better to the models of growth. Ted Cruz's plan is spectacular.

BARTIROMO: Let's talk about that plan. Why is Ted Cruz's plan so great?
Some people are saying what is different -- Ted Cruz has a 10 percent flat
rate, correct?

LAFFER: Yes.

BARTIROMO: Fifteen percent for business. Flat.

LAFFER: Yes.

BARTIROMO: But they're saying that maybe it includes what is called a vat tax and Ben Carson's doesn't include that. Is that true, art?

LAFFER: That's just the red herring. All good taxes have tax bases basically GDP.

BARTIROMO: OK.

LAFFER: There are three ways you can tax GDP. You can tax it when it's spent, which is the fair tax, you can tax it, which is earned, when it is the income tax, or you can do a vat, which is each state. But all three are very similar taxes.

The key to the tax that Ted Cruz has and it is really the central thing is it is not progressive. The more you make, you don't have to pay higher and higher tax rates. Because if you tax people and pay people not to work, you tax income earners and pay them not to work, you'll get a lot of non-work. Cruz's plan is the least disincentive to people to work.

You need rich and productive workers, you need them badly. You don't want them always spending their time trying to find loopholes, tax dodges and all that stuff, and Cruz's plan is excellent in that regard. It gets rid of the payroll tax and it has one flat rate tax to keep the tax arbitrages from spending all their time from trying to get around tax.

BARTIROMO: Which is why people talk about Marco Rubio's plan as being not that. He has a tiered plan and his highest rate is 35 percent. Not so much different than where we are right now.

LAFFER: No, it's really not, but Rubio's plan is fine. I don't want to knock the plan.

BARTIROMO: OK.

LAFFER: But it is not as good as Cruz's because of that. You don't want to tax people who earn higher and higher incomes with higher and higher rates. You know they're not going to pay it. I mean, when I did that piece on Warren Buffett, his effective tax rate is .06 of 1 percent of his income.

BARTIROMO: That's unbelievable.

LAFFER: It is unbelievable. But he finds tax loopholes, dodges, all legal, all perfectly fine, and he finds all of his time on that stuff. We want these --

BARTIROMO: So, here is a guy -- here is the guy who is basically saying the Buffett Rule, anybody who makes millions has to pay more tax and he's not paying any tax himself.

LAFFER: He's such a hypocrisy. It is such hypocrisy. He owns Berkshire Hathaway and all the trades on his stocks have gone below the surface. So, he never pays the capital gains. They're on all unrealized capital gains.

He gives away $2 billion or a little less to the Bill and Melinda Gates Foundation, which is tax deductible. He doesn't give it to the government. I mean, he has an insurance company which gets to deduct future expenses there, which he gets -- I mean, all of these are perfectly legal, but everything he suggests raising is something he doesn't pay. That's what we don't want.

(CROSSTALK)

BARTIROMO: Do you think we're going to see tax reform in the first year of a new president and do you think that's going to lead us to economic growth and jobs?

LAFFER: Yes, it will. But the tax reform, remember, has to take the long process. You have a secretary of the treasury, secretary of commerce, economist group, you have all these people making the plans, and then you have the House and the Senate -- you have Paul Ryan, don't think Paul Ryan is a potted plant and you're going to go through all of these and all of them will have it.

If you get a bill passed when we did with Reagan, which was in mid-August of 1981, we'll be lucky. It will start in either 82 or -- sorry, I mean, start the second year or the third year, ours really started the third year, that's why we had such a bad economy. And '81 and '82, because everyone tried to defer their income into '83 with lower tax rates.

BARTIROMO: Really important stuff here, Art. Thank you. We appreciate it.

LAFFER: Mohamed interview was spectacular.

BARTIROMO: Thank you so much.

LAFFER: It was really good.

BARTIROMO: You're the best. We'll see you soon, sir.

LAFFER: Thank you.

BARTIROMO: We are awaiting President Obama's statement on Iran from the White House, about six minutes away. Our panel on the nuclear deal in moments.

Back in a minute.  

(COMMERCIAL BREAK)

BARTIROMO: Welcome back. Welcome back. We're moments away from a statement from the president from the White House on the Iran nuclear deal and prisoner exchange.

First, though, our panel. Ed Rollins is former principal White House adviser to President Reagan. He's been a long time strategist to business and political leaders. He's a FOX News political analyst.

Judy Miller is adjunct fellow at the Manhattan Institute for Policy Research. She's a Pulitzer Prizewinning author and journalist and FOX News contributor.

And Mary Kissel is with us this morning, "Wall Street Journal" editorial board member.

And, Mary, I want to kick this off with you. Your reaction to the Iran
deal?

MARY KISSEL, WALL STREET JOURNAL EDITORIAL BOARD: It's a dog's breakfast, any way you look at it. The president just exchanged criminals for hostages. Not only that, Maria, but Oman coughed up half a million dollars for each hostage. And on top of that, Iran gets the prestige of looking like they won in this exchange, which, of course, they did. Iran does not get punished for bad behavior.

This is -- yes, it is great our hostages are home, but Iran retains more of our hostages and this is becoming a pattern with the Obama administration, whether it is Bowe Bergdahl, whether it’s the release of prisoners from Gitmo. Now we have a trade very lopsided, sets a terrible precedent. It's a terrible deal.

BARTIROMO: They get $150 billion this week, Mary.

KISSEL: That's right. They also have people removed from the Interpol list and they have 400 Iranians removed from the sanctions list.

BARTIROMO: Judy?

JUDITH MILLER, PULITZER PRIZE-WINNING REPORTER AND AUTHOR: Actually, they're not going to get $150 billion, not this week.

BARTIROMO: They're not going to get the money?

MILLER: Not this week. The White House had a briefing, and in fact what they're going to get immediately is about $50 billion and the Treasury Department has pointed out repeatedly --

BARTIROMO: So, they have $50 billion this week?

MILLER: If they have access to their own money. That was the deal. This is the deal. If we block or set back four different pathways that Iran could have used to achieve a bomb, they're going to be able to access their own money, which we have sanctioned. That was the deal. That's all it is. It's not going to change --

BARTIROMO: Everybody is saying some of that money, Judy, is going to go right to Hezbollah.

MILLER: Some of it is.

BARTIROMO: OK.

MILLER: Undoubtedly, it is. And that's why everything depends on the implementation of this deal. How tough the Americans are, in holding the Iranians to the letter and spirit of the deal.

BARTIROMO: Have we been tough at all? Have we been tough at all?

(CROSSTALK)

ED ROLLINS, FORMER ADVISOR TO PRESIDENT REAGAN: That's my -- I've been against this deal. I've been against the deal from the beginning of the argument many times in the show. I think it is a bad deal. I think at the end of the day, we're all -- we play this -- they're going to get a nuclear weapon and can't have that. We have got 6,000 nuclear weapons.

I worry about the Hezbollah activity. I worry about the terrorism. There is state sponsored terrorism. We have condemned them over and over again. And we've now rewarded them with $150 billion.

BARTIROMO: Could this have been stopped in any way, the money -- I know it is their money, you know. But can this have been -- that's what you keep saying, right, Judy? It is their money?

MILLER: Yes.

And the issue is, are you going to block Iran's path to a bomb. We are not going to transform the Islamic Republic, but we have given the moderates a -- or the pragmatists as I prefer to call them a great leg up.

(CROSSTALK)

MILLER: It will determine the future of the country.

KISSEL: That's very wishful thinking. Look at the pattern of Iran's behavior, since they signed the nuclear deal, violated U.N. sanctions with the missile test, they fired rockets in their Navy ships. They unlawfully detained 10 of our sailors. They have taken Americans hostage, they retained hostages here.

The IAEA, that's the U.N. nuclear weapons watchdog, there are assurances mean absolutely less than zero because we close the book on their past nuclear activities, we know they evaded the IAEA before. And the notification period in this nuclear deal is a joke.

ROLLINS: We have been chasing moderates since I was in the White House when Bud McFarlane is the national security adviser, with the birthday cake and the key, and that to try and basically find the moderate and we've never found one since. That was 1982.

MILLER: I'm not chasing moderates. But I'm saying is Iran has had a revolution since 1979. This is the first time they're beginning to act like a semi-normal country. This is an accomplishment that not even Donald Trump has said he rejects, by the way.

ROLLINS: Semi-good citizen who captured ten of our sailors last week, fired missiles at our U.S. aircraft carrier. I don't think that was a good citizen.

KISSEL: Let's not forget how Iran also treats its own people. Difficult to trust a regime that doesn't trust its own people. That's the other part about this deal that really rankles me.

The Iranians who were convicted in the United States were convicted under a rule of law. Our people were unlawfully detained, thrown into horrible conditions in prison, in Iran, and now we're acting as if this is a great triumph. This isn't a triumph.

MILLER: Getting our people back is always a triumph. Getting our people back alive is always a triumph.

(CROSSTALK)

KISSEL: They still have Americans in prison.

MILLER: Israel pays much more --

(CROSSTALK)

KISSEL: But the difference -- but the difference with Israel with all due respect, Judith, is they don't proclaim it as a victory. They see it for what it is.

MILLER: Neither did Kerry. Kerry said the arrest of these people, their imprisonment was reprehensible and it was not at all applauding what they did.

But we are not going to transform Iran overnight. What we can do is block their path, for 10 to 15 years for nuclear weapons. Let's just scale it back, guys. This is all we did. We did deals with the Soviet Union when they were much, much more --

BARTIROMO: Look, and John Kerry says this is a safer day. It is a safer day.

MILLER: I agree with that.

KISSEL: Not for the Americans who are going to be detained in the future because we now trade with a state sponsor of terrorism.

ROLLINS: And not for those that have to worry about Hezbollah attacking their lands.

BARTIROMO: We're going to hear from the president momentarily. I want to get to Eric Shawn, because we're going to hear the president's commentary on this deal right now.

SHAWN: This is a FOX News alert. I'm Eric Shawn here in New York.

We're going to pause for one moment to let our FOX stations join us.

This is FOX News coverage of President Obama about to speak on the controversial U.S. Iran prisoner swap and the lifting of those economic sanctions against Iran. As you know, four released American prisoners are making their way toward freedom, leaving Iran as global sanctions are removed against the Islamic state.

Here is the president of the United States.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: This is a good day, because, once again, we're seeing what's possible with strong American diplomacy.

As I said in my State of the Union address, ensuring the security of the United States and the safety of our people demands a smart, patient and disciplined approach to the world. That includes our diplomacy with the Islamic Republic of Iran. For decades, our differences with Iran meant that our governments almost never spoke to each other. Ultimately, that did not advance America's interests. Over the years, Iran moved closer and closer to having the ability to build a nuclear weapon.

But from Presidents Franklin Roosevelt to John F. Kennedy to Ronald Reagan, the United States has never been afraid to pursue diplomacy with our adversaries. And as President, I decided that a strong, confident America could advance our national security by engaging directly with the Iranian government.

We've seen the results. Under the nuclear deal that we, our allies and partners reached with Iran last year, Iran will not get its hands on a nuclear bomb. The region, the United States, and the world will be more secure.

As I've said many times, the nuclear deal was never intended to resolve all of our differences with Iran. But still, engaging directly with the Iranian government on a sustained basis, for the first time in decades, has created a unique opportunity -- a window -- to try to resolve important issues. And today, I can report progress on a number of fronts.

First, yesterday marked a milestone in preventing Iran from obtaining a nuclear weapon. Iran has now fulfilled key commitments under the nuclear deal. And I want to take a moment to explain why this is so important.

Over more than a decade, Iran had moved ahead with its nuclear program, and, before the deal, it had installed nearly 20,000 centrifuges that can enrich uranium for a nuclear bomb. Today, Iran has removed two-thirds of those machines.

Before the deal, Iran was steadily increasing its stockpile of enriched uranium -- enough for up to 10 nuclear bombs. Today, more than 98 percent of that stockpile has been shipped out of Iran -- meaning Iran now doesn't have enough material for even one bomb. Before, Iran was nearing completion of a new reactor capable of producing plutonium for a bomb. Today, the core of that reactor has been pulled out and filled with concrete so it cannot be used again.

Before the deal, the world had relatively little visibility into Iran's nuclear program. Today, international inspectors are on the ground, and Iran is being subjected to the most comprehensive, intrusive inspection regime ever negotiated to monitor a nuclear program. Inspectors will monitor Iran's key nuclear facilities 24 hours a day, 365 days a year. For decades to come, inspectors will have access to Iran's entire nuclear supply chain. In other words, if Iran tries to cheat -- if they try to build a bomb covertly -- we will catch them.

So the bottom line is this: Whereas Iran was steadily expanding its nuclear program, we have now cut off every single path that Iran could have used to build a bomb. Whereas it would have taken Iran two to three months to break out with enough material to rush to a bomb, we've now extended that breakout time to a year -- and with the world's unprecedented inspections and access to Iran's program, we'll know if Iran ever tries to break out.

Now that Iran's actions have been verified, it can begin to receive relief from certain nuclear sanctions and gain access to its own money that had been frozen. And perhaps most important of all, we've achieved this historic progress through diplomacy, without resorting to another war in the Middle East.

I want to also point out that by working with Iran on this nuclear deal, we were better able to address other issues. When our sailors in the Persian Gulf accidentally strayed into Iranian waters that could have sparked a major international incident. Some folks here in Washington rushed to declare that it was the start of another hostage crisis. Instead, we worked directly with the Iranian government and secured the release of our sailors in less than 24 hours.

This brings me to a second major development -- several Americans unjustly detained by Iran are finally coming home. In some cases, these Americans faced years of continued detention.

And I've met with some of their families. I've seen their anguish, how they ache for their sons and husbands. I gave these families my word -- I made a vow -- that we would do everything in our power to win the release of their loved ones. And we have been tireless.

On the sidelines of the nuclear negotiations, our diplomats at the highest level, including Secretary Kerry, used every meeting to push Iran to release our Americans. I did so myself, in my conversation with President Rouhani. After the nuclear deal was completed, the discussions between our
governments accelerated. Yesterday, these families finally got the news
that they have been waiting for.

Jason Rezaian is coming home. A courageous journalist for The Washington Post, who wrote about the daily lives and hopes of the Iranian people, he's been held for a year and a half. He embodies the brave spirit that gives life to the freedom of the press. Jason has already been reunited with his wife and mom.

Pastor Saeed Abedini is coming home. Held for three and half years, his unyielding faith has inspired people around the world in the global fight to uphold freedom of religion. Now, Pastor Abedini will return to his church and community in Idaho. Amir Hekmati is coming home. A former sergeant in the Marine Corps, he's been held for four and a half years. Today, his parents and sisters are giving thanks in Michigan.

Two other Americans unjustly detained by Iran have also been released -- Nosratollah Khosravi-Roodsari and Matthew Trevithick, an Iranian -- who was in Iran as a student. Their cases were largely unknown to the world. But when Americans are freed and reunited with their families, that's something that we can all celebrate.

So I want to thank my national security team -- especially Secretary Kerry; Susan Rice, my National Security Advisor; Brett McGurk; Avril Haines; Ben Rhodes -- our whole team worked tirelessly to bring our Americans home, to get this work done. And I want to thank the Swiss government, which represents our interests in Iran, for their critical assistance.

And meanwhile, Iran has agreed to deepen our coordination as we work to locate Robert Levinson -- missing from Iran for more than eight years. Even as we rejoice in the safe return of others, we willnever forget about Bob. Each and every day, but especially today, our hearts are with the Levinson family, and we will not rest until their family is whole again.

In a reciprocal humanitarian gesture, six Iranian-Americans and one Iranian serving sentences or awaiting trial in the United States are being granted clemency. These individuals were not charged with terrorism or any violent offenses. They're civilians, and their release is a one-time gesture to Iran given the unique opportunity offered by this moment and the larger circumstances at play. And it reflects our willingness to engage with Iran to advance our mutual interests, even as we ensure the national security of the United States.

So, nuclear deal implemented. American families reunited. The third piece of this work that we got done this weekend involved the United States and Iran resolving a financial dispute that dated back more than three decades. Since 1981, after our nations severed diplomatic relations, we've worked through a international tribunal to resolve various claims between our countries. The United States and Iran are now settling a longstanding Iranian government claim against the United States government. Iran will be returned its own funds, including appropriate interest, but much less than the amount Iran sought.

For the United States, this settlement could save us billions of dollars that could have been pursued by Iran. So there was no benefit to the United States in dragging this out. With the nuclear deal done, prisoners released, the time was right to resolve this dispute as well.

Of course, even as we implement the nuclear deal and welcome our Americans home, we recognize that there remain profound differences between the United States and Iran. We remain steadfast in opposing Iran's destabilizing behavior elsewhere, including its threats against Israel and our Gulf partners, and its support for violent proxies in places like Syria and Yemen.

We still have sanctions on Iran for its violations of human rights, for its support of terrorism, and for its ballistic missile program. And we will continue to enforce these sanctions, vigorously.

Iran's recent missile test, for example, was a violation of its international obligations. And as a result, the United States is imposing sanctions on individuals and companies working to advance Iran's ballistic missile program.

And we are going to remain vigilant about it. We're not going to waver in the defense of our security or that of our allies and partners.  

But I do want to once again speak directly to the Iranian people. Yours is a great civilization, with a vibrant culture that has so much to contribute to the world -- in commerce, and in science and the arts. For decades, your government's threats and actions to destabilize your region have isolated Iran from much of the world. And now our governments are talking with one another.

Following the nuclear deal, you -- especially young Iranians -- have the opportunity to begin building new ties with the world. We have a rare chance to pursue a new path -- a different, better future that delivers progress for both our peoples and the wider world. That's the opportunity before the Iranian people. We need to take advantage of that.

And to my fellow Americans, today, we're united in welcoming home sons and husbands and brothers who, in lonely prison cells, have endured an absolute nightmare. But they never gave in and they never gave up. At long last, they can stand tall and breathe deep the fresh air of freedom.

As a nation, we face real challenges, around the world and here at home. Many of them will not be resolved quickly or easily. But today's progress -- Americans coming home, an Iran that has rolled back its nuclear program and accepted unprecedented monitoring of that program -- these things are a reminder of what we can achieve when we lead with strength and with wisdom; with courage and resolve and patience. America can do -- and has done -- big things when we work together. We can leave this world and make it safer and more secure for our children and our grandchildren for generations to come.

I want to thank once again Secretary Kerry; our entire national security team, led by Susan Rice. I'm grateful for all the assistance that we received from our allies and partners. And I am hopeful that this signals the opportunity at least for Iran to work more cooperatively with nations around the world to advance their interests and the interests of people who are looking for peace and security for their families.

Thank you so much. God bless you, and God bless the United States of America.

SHAWN: You've been watching President Obama who just ended on an optimistic note, saying it's a good day. He praised the nuclear deal and release of the American prisoners who are now headed home.

But, you know, critics point out with the global sanctioning lifted against Tehran, Iran will still have more than $150 million with few strings attached to potentially prevent the revolutionary regime from using that windfall to support terrorism. And, of course, there are concerns that Iran will be able to potentially build a nuclear bomb when the nuclear agreement restrictions expire in 15 years.

And this morning, Iranian President Hassan Rouhani saying all are happy except, in his words, quote, "Zionists, warmongers and extremists in the U.S." But despite that, supporters say the agreement does herald a new era, in Iranian-U.S. relations as Iran now joins the international financial community and for now pledges not to pursue a nuclear bomb.

But as the president noted, two Americans remain in Iran, one held in custody in prison, the other, a former FBI agent still missing. As some wonder this morning in with this deal and the agreement and the release of the Americans, if Iran will really change.

Please stay tuned to FOX News Channel and this FOX station for continuing coverage of this developing story. For now, I'm Eric Shawn in New York.

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