TRANSCRIPT

Tillerson and the Trump WH take on Iran; Republicans' tax reform deadline slips

Amb. John Bolton weighs in on the future of the nuclear deal

 

This is a rush transcript from "Journal Editorial Report," April 22, 2017. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

REX TILLERSON, SECRETARY OF STATE: Iran is the world's leading state- sponsor of terrorism and is responsible for intense fighting in multiple contacts and undermining U.S. interests in countries such as Syria, Yemen, Iraq and Lebanon. They are continuing to support attacks against Israel. An unchecked Iran has the potential to travel the same path as North Korea and take the world along with it.

(END VIDEO CLIP)

PAUL GIGOT, HOST: Welcome to the "Journal Editorial Report." I'm Paul Gigot.

"Another North Korea in the making" - that was Secretary of State Rex Tillerson yesterday announcing that the Trump administration will conduct a comprehensive review of its policy towards Iran, warning that leaving the country unchecked would lead to greater threats around the world.

John Bolton is the former U.S. ambassador to the United Nations and a Fox News contributor.

Ambassador, welcome back to the program.

JOHN BOLTON, FORMER U.S. AMBASSADOR TO THE U.N. & FOX NEWS CONTRIBUTOR: Glad to be with you.

GIGOT: So, as a look at the first few weeks of the Trump administration foreign policy, it looks like there is really concerted focus on what I would call the countries that use or are trying to get weapons of mass destruction. Syria, we say the chemicals launched. North Korea, we've seen a concerted effort to contain that. Now Iran. Is that a fair summary of where they're putting their emphasis?

BOLTON: I think that's accurate. I think that reflects where the president himself is deeply concerned about the proliferation of nuclear weapons. In the case of the Syrian regime and the use of chemical weapons to actually use military force in response. If you put it all together, it's a very anti-proliferation administration.

GIGOT: That ought to be the focus, do you think? I mean, should that be our top foreign policy focus now?

BOLTON: Coupled with the obvious priority of destroying ISIS, the president has called for new plans from the Pentagon on that score, and I think it goes along with the widely held view, at least in Republican circles, that proliferation and terrorism are the two most urgent threats we face around the world.

GIGOT: OK. Let's talk first about North Korea. The president's strategy seems to be to say, you are -- the strategic patience is over so we're not going to anymore give you just the time you want to get the weapons you want. Also, to engage China in a more aggressive way, and say to China we will give you a better deal on economic access and trade, but you, in return, have to do something about North Korea. Is that a strategy that you favor? It's different than what the Bush and Obama administrations did.

BOLTON: It's definitely different. It's definitely an improvement. But I don't think it's sufficient. China has, for 25 years, talked one way about nuclear weapons and acted a different way. It says it doesn't want North Korea to have a deliverable nuclear weapons capability but it's never exerted the pressure that it could. So getting China to say, yes, we will do more is something that has been tried in the past. It hasn't worked.

I think the problem here is North Korea will never voluntarily relinquish its nuclear weapons program and, in effect, in their mind, it's equivalent to the regime itself.

GIGOT: Right.

BOLTON: So looking at the bigger picture, I think it is really the end of North Korea that is required to get the end of their nuclear weapons program. That means getting China on board for reunification. I think what President Trump has done could be a step in that direction, could be a step and try and bridge that gap but he is not there yet.

GIGOT: I don't see any sign that the Chinese government is anywhere close to that kind of recognition that they're willing to accept a unified Korea. Their fear is that they will get a unified Korea, through Seoul, with Western troops at the border of China. They don't want that. Even if the U.S. said, if you can unify it, we won't move our troops anywhere, they still are unwilling to take that step. How do you get China to make that recognition? Do you have to have Japan go nuclear first to be able to scare them enough to make a change?

BOLTON: That would certainly scare them. I think what you have said about the attitude of many in the top Chinese leadership is unquestionably true. It's reflecting Mao Tse Tung's rather unappetizing metaphor that the two Communist Parties are as close as lips and teeth. But we've seen in the past week, the leading Chinese historian of the Korean War basically call for a complete transformation of China's policy. They see -- he and many others see North Korea as a pretty ugly piece of baggage. I don't underestimate the difficulty of this negotiation. I wish we had started 10 years ago. Right now, North Korea and the progress towards being able to hit targets on the west coast of the United States with an ICBM, first raised by the commander of U.S. forces created last year, now I think it's widely accepted by analysts across the political spectrum, that has added a new urgency to this. And when Donald Trump says to Xi Jinping, as he apparently did, either you fix this or we will fix it by ourselves, you are risking military conflict on the Korean peninsula, which will bring all the things that China fears. So they could do it the hard way or they can do it the someway easier way. It's really up to them.

GIGOT: Let's turn to Iran. You saw Tillerson ratchet up the pressure on Iran. Yet, the U.S. is still saying it will continue to be part of the Iran nuclear deal. And the State Department said Iran is honoring that agreement. Do you agree that they are honoring that agreement?

BOLTON: Absolutely, not. That certification was an embarrassment to the administration. Iran has violated the parts of the deal reflected in the Security Council resolution adopted in 2015. They have exceeded the enriched uranium limits. They've exceeded the heavy water limits. They've barred IAEA inspectors from key military installations. And on the ballistic missile front, they are way, way out of compliance. So it was a step in the right direction for Secretary Tillerson to say at least we are reviewing the thing but the president has basically said they're not living up to the spirit of the agreement. I don't think Iran is living up to the letter of the agreement either. The sooner we ditch it and make clear political statements that their behavior is unacceptable not just on terrorism but on the nuclear front, too, the better.

GIGOT: So you would get out of it in the next few months if you were the Trump administration.

BOLTON: About 100 days ago, I would have gotten out of it.

(LAUGHTER)

GIGOT: I don't think they can do that. I think they are afraid the allies will just say we're not going to go with you on new sanctions, and the political cost of that is too high. I think they will put pressure militarily on expansion on Iran but not pull out of the deal. Do you agree with that?

BOLTON: It could be that they see the political risk is too high. Honestly, unless you lead the allies, they will not follow. Too many European companies are trying to get invested in Iran. I think every day that goes by makes it more difficult to get out of this disastrous deal.

GIGOT: All right. Thank you, Ambassador Bolton. Appreciate it.

BOLTON: Thank you.

GIGOT: Still ahead, The Trump Doctrine: From North Korea to Iran, the administration said the era of strategic patience is over. So what will take its place? Our panel weighs in, next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

VICE PRESIDENT MIKE PENCE: The United States of America well always seek peace. And under President Trump, the shield stands guard and the sword stands ready.

(END VIDEO CLIP)

GIGOT: Vice President Mike Pence aboard the USS Ronald Reagan in Japan on Wednesday warning North Korea not to test the resolve of the American military and promising an overwhelming and effective response to any use of conventional or nuclear weapons. The administration making clear in recent weeks that the era of so-called strategic patience is over. So what does that mean for American foreign-policy?

Let's ask Wall Street Journal columnist and deputy editor, Dan Henninger; Washington columnist, Kim Strassel; and columnist, Bill McGurn.

So, Bill, what have we learned these last two weeks, do you think, about the Trump foreign policy>

BILL MCGURN, COLUMNIST: As you said before, there will be no coherence ideology like a Trump Doctrine.

GIGOT: There's no such thing.

MCGURN: What we learned is not the America First of the 1930s, the isolationist kind of policy, you know, Charles Lindbergh, when they wanted to bomb Syria.

GIGOT: Right.

MCGURN: Right? So we learned that. We also learned that Donald Trump definitely is comfortable with the use of American force and rejects the idea that the only choice the president has is a full-scale U.S. invasion with U.S. troops and doing nothing. So within that, there's a lot of grounds in there on what he can do.

GIGOT: Yeah. The word of choice that some people have, Jacksonian, after Andrew Jackson, a muscular nationalism, but wary of too much foreign entanglement.

I know it's early but does that sound right.

DAN HENNINGER, COLUMNIST & DEPUTY EDITOR: I don't know, Paul. Reaching back into the 1830s strikes me as kind of a stretch on American foreign policy for 2017. If the era of strategic patience is over, I suggest what we're entering into is the era strategic impatients. Donald Trump is an impatient man. Whereas, Barack Obama used to lean back on most issues, so- called leaning from behind, Donald Trump's inclination is to lean in. That's clearly what he has been doing in the Middle East and Asia. The question is, what policy comes along with that. My impression is it harkens back maybe to the Reagan years, in 1988, strategic doctrine, in which we said we will work with our allies and use all the elements of American power, we would not seek work, but we would try to prevent domination of America's interests by any particular power.

GIGOT: But let me push back on that. What I recall from the '80s with Reagan was extremely patient. It set up a policy that said we're going to contest the Soviet Union across the board, we're going to call it what it is, an evil empire, we're going to try to undermine politically and internally. But we're not going to rush to any engagement overseas. We'll be very cautious on that. But he was very patient.

HENNINGER: He wasn't so patient in Grenada.

GIGOT: Well, Grenada isn't North Korea.

HENINGER: Yeah, sure. But he acted when he had to act. In Syria, I wouldn't compare Syria to Grenada, but Syria, he was taking a limited action for the purposes of showing the allies in the region that we are going to be there. And I think a political strategy will follow the strike on Syria, same as is happening over in Korea.

GIGOT: One of the things that we've seen, Kim, is that alliances are back in vogue in a way they weren't during the Trump campaign. I mean, he's now -- he said NATO was obsolete. Now he says, well, it's not obsolete. He was cautious about the alliance with South Korea and Japan. Now is he is putting both arms behind Japan and South Korea.

KIM STRASSEL, WASHINGTON COLUMNIST: Yeah. This is important, and it falls on what Bill said, that this is not the isolationism that a lot of people feared. He has not only put his arms around NATO, he has invited Montenegro to join. He is expanding alliances rather than diminishing them. Because I think that there is an understanding in the senior leadership and the top administration that if you are going to be forceful and take these actions, that you do so even more effectively when you have big allies behind you and you could rally the world. We've seen that with Nikki Haley, his ambassador to the United Nations, very much attempting to reach across and get various like-minded people to push back along with the Trump administration and make a statement globally about some of these rogue actors.

GIGOT: All right. Bill, I want to ask you about this episode last week with the "USS Carl Vinson," the carrier group, where the White House and President Trump said, we are sending in armada to the North Korean peninsula, and the Pentagon suggested the same, and we find out it's actually down --

(CROSSTALK)

(LAUGHTER)

GIGOT: About a half a world away in the Indian Ocean. This had a bad reaction in South Korea.

MCGURN: Yeah.

GIGOT: They said, look, can we trust you or not? You don't want to say your force is there and it's not.

MCGURN: It's just an embarrassment. Somewhere, the message got mixed. But it was a good idea to send a carrier group to North Korea, and they should have done it.

I think the thing about Donald Trump is he has said a lot of contradictory things over the course of the campaign, and some of them you just can't square. He was down with NATO before and now Montenegro. I don't think he would have had the rhetoric that supported the Syria strike in the campaign. But it does show he's willing to learn. And some people get that once he got in office and saw the complexity, he would realize, for example, that Vladimir Putin was an obstacle to a lot of the things that he would want to do. So we're going to have to -- I keep saying it's kind of like Nancy Pelosi and the health care bill, we're going to have to let Trump carry out his foreign-policy to find out what it is.

GIGOT: But that's dangerous, potentially, is it not, if the rest of the world is trying to wait and figure out, OK, what's going to come down on this one?

(CROSSTALK)

MCGURN: Except they think they now have to think when the American president will act, which they did not have for eight years.

HENNINGER: Well, that's how the Japanese reacted. It was interesting that, yes, the Koreans were upset, but the Japanese government spokesman was asked directly about the armada incident, and he declined to comment on that. All he said was, we are happy that the United States is now putting all options on the table. That's a step forward for the Japanese and their attitude towards these sorts of things. I think they are focused on the main issue in Asia.

GIGOT: All right. When we come back, Republicans narrowly avoid an embarrassing defeat as the Democrats come up short in a special election in Georgia. But is it a warning for the GOP heading into the 2018 midterms?

(COMMERCIAL BREAK)

GIGOT: Democrats came up short Tuesday on the special election to fill the Georgia House seat once held by HHS Secretary Tom Price, with Democrat Jon Ossoff narrowly missing the 50 percent threshold needed to win the race outright. He will now face Karen Handel, the top Republican vote getter, in a June runoff.

We are back with Dan Henninger and Kim Strassel. And Wall Street Journal assistant editorial page editor, James Freeman, also joins the panel.

Kim, you wrote this week that you thought Democrats were finally getting their act together with this Georgia race. How so?

STRASSEL: For eight years under Barack Obama, the Democrats had had this very arrogant approach in which they just believed that their progressive values would resonate across the country and you saw the result, which was they lost the House and the Senate and any number of seats at the local level. So what you saw down in Georgia this week was a Democratic Party that determined they were going to run a candidate that fit the district and had a shot at winning. This was a guy who bragged about his national security credentials. He talked about cutting taxes for small businesses. He was a fan of cutting waste and corruption in Washington. Now he also held a lot of progressive views and that's probably why he won't win this district in the end. But a lot closer to the smart Democratic policy of old of trying to actually run candidates who can win.

GIGOT: And the Democratic Party nationally poured an enormous amount of money in this and you're saying they were willing to give him a pass on some of these other issues because they realize they want to paste a defeat on the Republicans and the Trump administration, and you need to pick up a seat here at the margin in these kind of swing districts, suburban districts, if you're going to take back the House. Are we seeing a new pragmatism on the part of the Democrats here, or is this just a one off?

STRASSEL: It is, and not just among the Democratic leadership. You had groups like the Daily Koss, which is a far-left progressive organization, supporting these guy, despite his views on tax cuts, and his views on national security, because they have come to understand and they actually said, unless we have a Democratic majority again in Congress, we can achieve any of our priorities.

GIGOT: It's really interesting, Dan, because you would think that -- the Republicans here have a split field, 11 candidates, or something like that. None of them could really build any momentum. Nonetheless, they still managed to hold off, by 50 percent. But you would think -- there was a lot of chortling among Republicans. The left is going to challenge the primary run against anybody who goes it all to the center. Maybe that's not the case. And this looks to me like a little bit like the 2006 strategy where the Democrats took back the House by Rahm Emanuel, who was then in the House, picking candidates who were more appropriate to the swing districts.

HENNINGER: Yeah. I guess one questions is, though, how appropriate are those candidates to the national party or what they might do when they're in Congress. There was nothing vaguely right of center about Barack Obama's presidency.

GIGOT: That's true, but if the local voters say this guy is a reasonable guy, yeah, Pelosi, we'll worry about that later, but he seems fair. And if the Republicans are not enthusiastic, you could see them turning up, particularly in these suburban areas.

HENNINGER: In those suburban areas. It's very important and isn't talked about enough. Look, Ossoff, in some respects, was a progressive Libertarian. He's left of center on social issues and he's right of center on economic issues. And there is a sense I think in which in these suburban counties the culture is, in some sense, moving leftward on issues like women, gender, race relations and so forth, at least the way the progressives define it. So the Republicans I think have got to get some momentum back and start focusing on those counties and address the phenomenon we just saw in that Atlanta district.

GIGOT: Yeah, particularly when it comes to these districts where you have college educated Republicans, who aren't in love with Trump. And Trump only won this district narrowly.

JAMES FREEMAN, ASSISTANT EDITORIAL PAGE EDITOR: Yeah. So I think the Democrats probably -- this is positive because what they're doing is they're focusing on how to we assemble a winning coalition versus spending their time blaming fake news, the Electoral College, Russia, misogyny, whatever else they want to ascribe last fall to. They are now, I think, looking forward a little, how do we rebrand ourselves. But I think they will find, voters in this district will find that Ossoff is really not all that moderate, even on economics. So I think what they've got to do is move back towards candidates in swing districts who are actually moderate not just projecting a moderate image.

GIGOT: How do you feel about this runoff in June, Kim? And throw in Montana, where you have another special election coming up.

STRASSEL: It is going to be tough for Democrats to win this district. As you said, the Republicans split it between 11 candidates. Karen Handel, the Republican nominee, is very quickly gathering and uniting support among Republicans. They had to spent $8 million just to get off where he was. You can ask whether it would've been smarter for them always to put a lot more attention into Montana and the special election coming up because that is a state that has historically --

GIGOT: Elected Democrats.

STRASSEL: -- elected Democrats, right. So if they were in a place their bets somewhere, that might be a big shot. You'll see them move a lot of resources to that state now.

GIGOT: You think they are going to compete there as well? They really do need, for all --

STRASSEL: They want to victory.

GIGOT: They need a victory here to show Republicans, and scare Republicans from actually taking difficult votes in Congress.

STRASSEL: Yeah, absolutely. They want to send a message that there is some sort of backlash to Trump, that the voters have already turned against him. None of these special elections necessarily would say that, regardless of the outcomes. They really do turn more often on local issues, et cetera. But they believe if they can notch up a win that they can suggest that the tide has turned against Donald Trump, and Republicans must beware.

GIGOT: All right. Still ahead, Republicans scramble as their deadline for tax reform slips. Economist Art Laffer joins us with some advice for the GOP.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

PRESIDENT DONALD TRUMP: We are in very good shape on tax reform. We have the concept of the plan. We will be announcing it very soon. But health care -- we have to get the health care taking care of. And as soon as health care takes care of, we are going to march very quickly. You're going to watch. We're going to surprise you.

(END VIDEO CLIP)

GIGOT: President Trump on Tuesday sounding an optimistic note on tax reform just a day after his Treasury secretary walked back expectations for how quickly an overhaul would happen. Steve Mnuchin, who initially set an August goal for casting a bill, told the "Financial Times" this week that a summer deadline is, quote, "highly aggressive to not realistic at this point."

My next guest has some advice from the administration as it struggles to move forward with a plan, keep it simple.

Economist Art Laffer is the co-founder of the Committee to Unleash Prosperity. He advised the Trump presidential campaign on economic policy.

Good to see you again, Arthur.

ART LAFFER, ECONOMIST & CO-FOUNDER, THE COMMITTE TO UNLEASH PROSPERITY & FORMER TRUMP ECONOMIC ADVISOR: Thank you, Paul. Good to see you.

GIGOT: All right. I want to ask about the economy and where we are first, before we get to tax reform. A lot of signs of weakness in the quarter, maybe extending into the second. Are we in slow growth right here?

LAFFER: Well, in the very short term, but, yes, we are. We are in a slow period. But in the long term, we're in the worst possible economic condition we've have in 67 years. The economy, if you look at real GDP, we are the lowest point in 67 years, Paul. It's a horrible economy. We really need something to get this thing going and bring us back up to the norms we had in the '60s, 70s and '80s.

GIGOT: All right. I think you think tax reform it part of that agenda. So --

LAFFER: It sure is.

GIGOT: OK. But what about this timing, the delay on this. When people, businesses think there is going to be a tax cut around the corner, they tend not to invest right now.

LAFFER: That's true. That's the big mistake we made under Reagan was we deferred the tax cuts. If you know they're going to cut taxes the next year, what do you do this year. You defer all the income you possibly can to next year, and that's why we had the '81, '92 deep, deep, deep recession, was because of the deferred taxes. They shouldn't make that mistake. Big tax reform, the mega tax reform that they're talking about takes time and it does take a lot of time. But we could do one thing right away. We could cut that corporate tax rate from 35 percent to 15 percent just right away to get the economy jump-started. So that's what I think they should do. So --

(CROSSTALK)

LAFFER: -- you get that corporate rate down, everyone wants it.

GIGOT: So Democrats support it, in theory. Republicans support it.

LAFFER: Yeah, they do.

GIGOT: So basically, do that corporate tax reform. But how do you get Democratic votes for something like that when, right now, there's so much hostility to the Trump administration? I mean, you've got to get 60 votes for what you're talking about in the Senate.

LAFFER: I don't know about the Senate. But I do know there are a lot of Democrats now who really want to do tax reform. I did one for Jared Polis (ph) and Darrell Issa quite a while ago that would've been a radical tax reform on corporate taxes. So there is a lot of support in the House for this, and I believe in the Senate, too, Paul. I'm not an expert on counting votes.

GIGOT: Right.

LAFFER: But when you look at this, it would raise revenue dramatically. And the only reason the president wants to do health care first is because of this silly, silly notion of pay-for, where you have to find something to cut taxes, if you're going to raise them. It's just ridiculous. And I don't know who is giving him that advice. But honestly, if we had had pay- for in the 1920s, we never would've have the Roaring '20s. We never would have had the go-go '60s. And goodness knows, we would not had have the Reagan Revolution in '80s.

GIGOT: OK, so you're saying that revenue neutrality, just forget about that. Let's just cut the rate. You'll get a lot more revenue than you think coming back anyways so --

LAFFER: Oh, definitely.

GIGOT: -- don't worry about it. And that will take care of itself over time as the economy ratchets up the growth rate.

LAFFER: That's right. Yeah, you want to have revenue neutrality with tax cuts this year and revenue three years from now. That is the way you want to do it. You don't want to cut welfare programs when the economy is in bad shape like this to pay for a tax cut. Frankly, this is a time, Paul, that people need welfare payments because they are having hard times. Once you get the economy growing, then you can cut the welfare programs because people have good high-paying jobs. But right now, you need to be warm hearted as well as clear-eyed.

GIGOT: How low do you think the corporate tax rate has to go? It's 35 percent now. Does it have to go all the way to 15 or can you settle for 20? Would that be enough?

LAFFER: I think it's a continuum. Obviously, 20 is better than 35. 15 is better than 20. What I would really love to see is the corporate tax rate reform where we're not taxing profitable companies and subsidizing unprofitable ones. I'd would love to see, like, a Value-Added Tax for corporations and get rid of the corporate tax all together. But that, notwithstanding, I would love to see it go as low as possible.

GIGOT: Here's the other question. I know that a lot of House Republicans, like Speaker Paul Ryan, are worried about this. If you do corporate tax reform first, you are leaving the individual taxpayer behind, and maybe even the small business taxpayer behind. Why should the poor wage slave pay 40 percent when somebody who is in business is only going to pay 15?

LAFFER: Because his wage will be doubled.

(LAUGHTER)

That's why he pays 40 percent. Or he's going to have a job rather than being unemployed. The whole key here is the people who don't pay taxes because they have no income are not really benefited by our tax code, if I may be so frank. And you cannot balance the budget, Paul, on the backs of the unemployed or people who leave your jurisdiction. It just doesn't happen that way.

(CROSSTALK)

GIGOT: But, Arthur, will you concede that if you do corporate tax reform first, you may never get the kind of individual tax rate reductions that you and I would both like to see because, politically, it becomes much harder if you don't attach it to something that, for example, the Democrats want. They Democrats don't want individual rates cut.

LAFFER: That's true. They have been arguing -- they did that like in the 80s as well. When we did our ultimate tax reform, Paul, in the '80s, it wasn't until 1986, six years into Reagan's presidency, before we were finally able to bring the Democrats together because of the prosperity we created. All of the Democrats joined with us in 1986 to support the '86 Tax Act, which dropped the highest rate, if you'll remember, from 50 percent down to 28 percent. It cut the corporate rate from 46 to 34 percent. And it got rid of all of these deductions and exemptions and seclusions and favor grabbings and had it revenue neutral. It was the best tax bill ever and it passed in the Senate, 97 to three.

GIGOT: All right.

LAFFER: That will happen now. Once Trump gets the prosperity going, the Democrats will flock to our side, Paul.

GIGOT: All right.

LAFFER: They would love to be with us.

GIGOT: Cut corporate taxes now, get the economy growing and then bigger tax reform later.

We're going to see if the president takes your advice.

Art Laffer, thanks for being with us.

LAFFER: Thank you.

GIGOT: Still ahead, a high-profile religious liberty case greets Supreme Court Justice Neil Gorsuch with his first week on the job as talk grows of another high-court vacancy as early as this summer.

(COMMERCIAL BREAK)

GIGOT: Neil Gorsuch made his Supreme Court debut this week with the justices hearing argument in a closely watched religious liberty case. At issue in Trinity Lutheran is whether Missouri violated the Constitution when it barred a church-operated daycare and preschool in Columbia from participating in a state program that gives funding to nonprofits to upgrade their playgrounds. The outcome of the case could have far-reaching implications for future church-state disputes.

Wall Street Journal editorial board member, Collin Levy, joins us with more.

Collin, what is at stake here on religious liberty grounds in this case.

COLLIN LEVY, EDITORIAL BOARD MEMBER: Paul, this is a really important case because what you're looking at is a situation where the state was barring the church from participating in a program that was completely religiously neutral. The playground safety for children isn't actually a religious activity. So what the state --

GIGOT: Last time we checked.

(LAUGHTER)

LEVY: Not last time we checked. What the state was saying here is, you know, you can can't do this just because your church. That's very serious because the First Amendment guarantees a pretty narrow, clearly cut ban of what the government can do in regard to religion. You have to be able to exercise your religion freely and, on the other end, the government can't endorse an establishment of religion. So the justices were very skeptical in this argument that the state was acting properly.

GIGOT: Right. I want to talk about that. But the genesis of the opposition in the state to this kind of allocation of money for neutral purposes goes back to something called the Blaine Amendment, which is -- you and I had written about this for years -- going back to the 19th century, named after James G. Blaine, the continental liar from the state of Maine, they said, when he ran for president. But he was a prominent American politician. And these amendments really were aimed at barring state money going to Catholic institutions. So there was a real anti- Catholic bias behind this.

LEVY: There was really an anti-Catholic bias behind them, Paul. And what is so interesting is now these amendments are being used to block basically any religion from the public square. They are a big deal for a lot of state governments who are trying to use them against school choice programs because they're saying you can't have any situation where any public money from the state is flowing to any religious institution, even when it's a neutral purpose, as in this playground case, or in the Supreme Court -- in the voucher contact, where it is a parental choice issue. So it's a big thing.

GIGOT: You have to love the irony of the left, using essentially an anti- Catholic provision of the state constitution for their modern political purposes.

BILL MCGURN, COLUMNIST: Yeah. Look, there has been a big switcheroo, as Collin pointed out and you were saying. The genesis of this was anti- Catholic. In fact, it wasn't anti-sectarian, although that's the language. They wanted a generic Protestant kind of faith. The red the King James Bible and so forth. The language now, which supported then Protestant schools, is now secular. So there has been a switcheroo in what they're trying to do.

The other thing is, it's absurd. We mock Medieval philosophers for counting the number of angels on pinheads, and now we have a Supreme Court trying to decide when a playground becomes religious or an act of a church.

(CROSSTALK)

GIGOT: But, Dan, that transcript, I was really encouraged. You had Elena Kagan and Stephen Breyer, two of the more liberal justices, basically sounding real skeptical of the state being able to make these distinctions.

DAN HENNINGER, COLUMNIST & DEPUTY EDITOR: The idea at the center of it is what Collin mentioned, something called the Neutrality Principle. Justice Kagan did say that, in her view, allowing funding to be used for the playground, was a neutral function. Her phrase, "neutral function."

GIGOT: It's not religious.

HENNINGER: It's not religious. Now, in the 2002 Zelman case, which involved the Cleveland school voucher program, they won. And Justice Rehnquist, writing for the majority, said it was a neutral administered program. And joining him was Justice Sandra Day O'Connor. It was interesting that in that case, both Justices Breyer and Ginsburg voted against the Cleveland position. I would expect certainly Justice Ginsburg to hold the position on this. Justice Breyer wasn't so clear from the oral argument. He might be going over to where Justice Kagan is now.

GIGOT: Collin, let's talk about the potential opening. Chuck Grassley, the head of the Senate Judiciary Committee, saying he expects another Supreme Court seat to open in the summer. Is this wishful thinking perhaps on his part or is there some real possibility?

LEVY: Paul, there's always a possibility. This speculation is going on inevitably because some of the justices on the court are rather old and we know, historically, that most presidents get two Supreme Court nominees, going back to Reagan. So there is always a possibility that this is can happen. I haven't seen any evidence that there is anything particular or any justice actually planning to retire. I think if we knew that, the justices would've said so. By the way, they're pretty good at keeping things to themselves. So I think when there is a justice about to retire, they're going to tell us.

GIGOT: Yeah, the big question is whether Anthony Kennedy decides he wants to step down now to let a Republican president name his replacement. I think that is the one you have to watch.

All right. When we come back, President Trump President Trump returning this week to one of the central campaign themes, but will his Buy American/Hire American executive order deliver on his promise?

(BEGIN VIDEO CLIP)

TRUMP: The American people voted to end the theft of American prosperity. They voted to bring back their jobs and to bring back their dreams.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

TRUMP: I am proud to announce that we are about to take bold new steps to follow through on my pledge to buy American and Hire Americans.

With this action, we are sending a powerful signal to the world, we are going to defend our workers, protect our jobs and, finally, put America first.

(END VIDEO CLIP)

GIGOT: Present Trump in Kenosha, Wisconsin, Tuesday, where he signed his Buy American/Hire American executive order directive, playing off one of his main campaign promises to bolster protections for certain American-made goods and calls for a review of the H1B1 visa program for skilled foreign workers.

Wall Street Journal editorial page writer, Allysia Finley, joins us with more.

Allysia, a lot of big rhetoric here, but what is the actual practical impact of the Buy American provision?

ALLYSIA FINLEY, EDITORIAL PAGE WRITER: It's likely not to have a big impact because, look, all the way back to the New Deal, we've had laws on the book's already favoring American products procurement.

GIGOT: For federal government contacts?

FINLEY: Right. Exactly. There are also laws requiring that construction projects funded by the federal government use U.S. or steel. But there are exceptions.

GIGOT: Is that what this is aimed at, those exceptions?

FINLEY: Supposedly. That is what Mr. Trump has said, and one of his spokesman. He said that federal officials are using these exceptions, exceptions that are inconsistent with the public interest. If costs are too high, if the products are unavailable in the U.S., it violates the free-trade agreement.

GIGOT: OK, but it sounds as if there's not going to be that big of an impact, for example, on actually much change in what they buy and it won't affect the trade deficit much at all.

FINLEY: No. It's very symbolic. He is trying to fulfill a campaign promise to put American first, as we just heard. The bigger impact will be if he slaps tariffs on steel.

GIGOT: That was a separate order, a memo that he issued this week, where he said, look -- asked the Commerce Department to review steel imports as, James, a national security threat.

JAMES FREEMAN, ASSISTANT EDITORIAL PAGE EDITOR: Right.

GIGOT: OK, national security steel imports?

FREEMAN: Yeah, it's kind of a reach here. It is a little-used law, especially over the last several decades. Theoretically, if we were unable to get steel imports from anywhere, this could be a concern. We have many allies with plentiful steel in their country so it's really not an issue. It's looking for a new way to attack steel imports. Because what is disappointing here is steel is very expensive in the United States compared to other countries. That may have something to do with the fact that the U.S. government already has more than 100 remedies in place trying to help U.S. steel and hurt foreign steel. This is an area where the government has already been implementing the Trump program and what it means is higher prices for us and everything that we buy, whether it's people making pipelines, automobiles, what have you.

GIGOT: This is 232 provision of a 1962 law, which has been using the national security language in that law. It looks like Trump has already made up his mind, I'm going to slap tariffs on steel. Wilbur Ross, you find me an excuse.

FINLEY: Right. Exactly. They have to do this. He's saying you have to get this done in 40 or 50 days. You have all the way up to 270 but we're going to get this done fast. For legal reasons, they have to conduct this review. But they're just going to look for some kind of pretext, oh, wages of steelworkers have gone down, so ergo, we need to block here.

GIGOT: Get your orders in now, Dan --

HENNINGER: Yeah.

GIGOT: -- if you're a U.S. domestic steel user.

HENNINGER: Refrigerator, car.

GIGOT: Whatever you make with it, transportation equipment, whatever, because the prices are going to go up.

HENNINGER: Yeah.

GIGOT: What happened on the Bush years when they slapped --

(CROSSTALK)

HENNINGER: Yeah. Economists looked at what happened in the Bush years. It was a two-edged sword because jobs were lost in some of those industries. That used steel. Guess which states? Ohio, Michigan and Pennsylvania. Trump's states, he could be creating a reverse Trump phenomenon by putting people out of work in his states.

(CROSSTALK)

GIGOT: Go ahead.

FREEMAN: It is going to get in the way of his infrastructure agenda. Like we need something else that is going to make projects more difficult and more costly and time-consuming. I don't know if it will be in league with environmental-impact statements, but to the extent it rolls out, it is going to make the infrastructure plan harder.

GIGOT: Briefly, I mean, Democrats praised it. Chuck Schumer said, terrific, we love it.

FINLEY: Exactly, because it's favored by United Steel Workers Union in Pennsylvania and some other areas. But you know what? Some other unions, the Building Trades Union, the UAW, may not be very fond of it because steel is used in a lot of their products.

GIGOT: All right. Thank you all.

We have to take one more break. When we come back, "Hits & Misses" of the week.

(COMMERCIAL BREAK)

GIGOT: Time now for our "Hits & Misses" of the week -- William?

MCGURN: Paul, a miss for Bill de Blasio, who just announce he is making New York even more attractive for weapons dealers and smugglers.

(LAUGHTER)

That's not how the major put it but that is the implication of his bid to drive up cigarette prices to $13 a pack. Remember that the man who choked to death in police custody, Eric Garner?

GIGOT: Right.

MCGURN: That was over the sale of loosie cigarettes. So if Mr. de Blasio is serious about this, he will have more clashes between people selling untaxed cigarettes, as Eric Garner was, and the police. If he's not serious, all he's doing is allowing the people to flout the law while honest bodega owners and so forth see their sales diminish.

GIGOT: Bill de Blasio, the best friend of black marketers.

MCGURN: Yeah.

(CROSSTALK)

MCGURN: Progressives, New York style.

GIGOT: Allysia?

FINLEY: This is a hit to California Senator, Democratic Senator Dianne Feinstein, who spoke to progressives this week. By refusing to denounce the Trump administration and refusing to support a single payer and, for that, she was booed by her audience.

GIGOT: They don't like any kind of accommodation there at all.

All right, interesting.

James?

FREEMAN: This is -- I'll call it a hit to those adorable vegetarians who wrote really -- I'm going to give them a hit because they are innovating. The Journal's news site this week had a story about new butcher shops with no meat in them. They've come out with a whole new line of things that look like meat, cutlets, patties, barbecued ribs, all the things we love, except they aren't. They also have beet juice made to look like broth. Why this is appealing to vegetarians, I don't know. But knock yourselves out.

GIGOT: So you'll be frequenting those shops?

FREEMAN: I think there is a reason people still seem to be looking for meat.

GIGOT: All right.

Remember, if you have your own hit or miss, be sure to tweet it to us, @JERonFNC.

That's it for this week's show. Thanks to my panel. Thanks to all of you for watching. I'm Paul Gigot. Hope to see you right here next week.

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