This is a rush transcript from "Journal Editorial Report," June 10, 2017. This copy may not be in its final form and may be updated.
PAUL GIGOT, HOST: Welcome to the "Journal Editorial Report." I'm Paul Gigot,
Fired FBI Director James Comey made his much-anticipated return to Capitol Hill this week, appearing Thursday before the Senate Intelligence Committee. In his testimony, Comey described interactions with the president specifically a February meeting with Mr. Trump in the Oval Office as "disturbing and concerning" but stopped short of accusing the president of obstructing justice.
(BEGIN VIDEO CLIP)
JAMES COMEY, FORMER FBI DIRECTOR: I don't think it's for me to say whether the conversation I had with the president was an effort to obstruct. I took it as a very disturbing thing, very concerning, but that's the conclusion I'm sure the special counsel will work towards to try and understand what the intention was there and whether that's an offense.
(END VIDEO CLIP)
GIGOT: Michael Mukasey served as the 81st attorney general of the United States under President George W. Bush.
MICAHEL MUKASEY, FORMER U.S. ATTORNEY GENERAL: Good to be here.
GIGOT: Let's focus first on what's the appropriate behavior for a senior Justice Department official, like the FBI director, in interacting with the president of the United States because when you go into the Oval Office, it's an intimidating thing, I guess. How was he supposed to behave when the president pulls him aside and says something like he said with -- by Michael Flynn?
MUKASEY: The same way he would behave any place else. Yes, the Oval Office -- the idea of the Oval Office is intimidating, he may be in fact, intimidating for the first few times you're there, for the first 15 minutes.
If you've been the U.S. attorney in two districts, if you've been the deputy attorney general, if you've been for a number of years the director of the FBI, and you're intimidated by being in the Oval Office, you're in the wrong job.
GIGOT: How should he have reacted to that?
MUKASEY: If he thought what he says he thought, he should have said, Mr. President, we can't have this conversation.
GIGOT: And he said he thought he was being directed to shut down that portion of the probe, the Flynn probe, he should have said, we can't have this conversation and talk to the attorney general?
MUKASEY: Sure. Talk to the attorney general. I don't think that it would have been reporting a crime but he should have talked to the attorney general immediately so that anybody else was aware of what had happened when everybody left the room.
GIGOT: What about the idea that James Comey has talked about, he used the word, he said, "The FBI is traditionally been independent of the executive branch." Is that true?
MUKASEY: No, it's not true. The FBI is in the executive branch and it is not independent. There's a very funny story about Ramsey Clark, when he first became A.G., showed up on a Saturday and wearing a sport jacket and was stopped in the hall by a watchman who said, can I see your I.D. He said, well, I'm the attorney general. That's fine, show me your I.D. He said, no, I'm the attorney general. He said I don't think if you're J. Edgar Hoover himself, show me your I.D. That's some people's idea of the FBI being independent but it's not.
GIGOT: So the FBI director and the Justice Department are part of the executive branch and they're subject to the political accountability of the president of the United States, and yet there's some tension there because you don't want political actors directing investigations or saying stop that investigation, so there is -- there is some tension, there is some art to this?
MUKASEY: There is. You don't want political actors doing that. At the same time, if there are, for example, reasons of state why investigations should be stopped, if somebody is investigating a relatively minor crime committed by some foreign diplomat or by somebody in whom the president has a much larger interest, he would be perfectly proper in saying I want that investigation shut down, there are bigger things at stakes here.
GIGOT: Was the president's behavior, in your mind, improper? I'm not saying illegal, I'm just saying improper first.
GIGOT: Shouldn't have acted that way?
MUKASEY: There are a lot of things that you don't do, not because they're against the law, because you simply don't do them, and that's one of them.
GIGOT: What about the question of obstruction of justice, do you see any of that in the facts that Comey laid out?
GIGOT: Why not?
MUKASEY: The obstruction of justice statute in so far as it's relevant requires that the president acted corruptly, unless he acted by force, which obviously he didn't. So that he acted corruptly -- that means doing something lawful by an unlawful means or doing something unlawful -- he didn't do either one of those. It wasn't that he took a bribe in order to shut down the investigation, it wasn't that he offered a bribe in order to shut down the investigation, he acted apparently out of concern for -- for Flynn, perhaps even out of concern for himself. That's not corruptly.
GIGOT: What about the chain of events, I would hope to let this go and then, later, some months later, he fired Comey. Is that of a chain of events that he was trying to shut down the probe by firing Comey?
MUKASEY: If you want to shut down a probe, you don't shut down the probe by firing somebody to whom the people who are conducting the probe report.
GIGOT: I think that's been proven by the fact of all the uproar.
MUKASEY: Correct. That's not the way you shut down a probe?
GIGOT: Comey is kind of having it both ways. On the one hand, he says, I felt directed to shut down the probe, on the other hand, I'm not saying it was obstruction of justice. But if he really felt it was directed, OK, he was being told, look, you must do this, why -- didn't he have an obligation to go back to the Justice Department, tell the attorney general, and maybe tap out a resignation letter saying, I cannot work for somebody who is directing me not to investigate something?
GIGOT: That's certainly an alternative. You recall, when he was deputy attorney general, the famous hospital scene, and he did threaten to resign unless they changed the program.
GIGOT: Right. I think he typed out the letter in advance of that meeting.
MUKASEY: Right. In fact, he was joined with the man who is now supposedly investigating all of this, Robert Mueller. The two of them both threatened to resign.
GIGOT: That is right.
Comey clearly said -- but if Comey said I believe there was obstruction at the time, then he would have had to talked to the attorney general and maybe resigned.
MUKASEY: Threatened to resign.
GIGOT: You'd would think he would.
What do you make of him going back to the FBI, as he testified, telling half a dozen or 10 colleagues about this, and then keeping it quiet, essentially sticking his notes into a drawer, and then keeping it quiet from everybody until he was fired?
MUKASEY: That's what's known as having an ace in the hole. Not only did he create a memo, he created a memo that was, by design, not classified so that he could have it leaked eventually. Gave it to somebody else to leak so that he wouldn't have his fingerprints on it immediately, and assured that, according to his own statement, that a special prosecutor, special counsel would be appointed. That's an extraordinarily devious thing to do.
GIGOT: Bottom line, if based on the fact that is we know, there's not an impeachable offense or indictable offense in what we learned?
MUKASEY: An impeachable offense is what Congress says is an impeachable offense.
GIGOT: It's a political act?
MUKASEY: It's a political act. And it's a gross neglect of duty or abuse of power. It needn't be a crime. I don't think this rises to an impeachable act but that's for Congress to decide. It is not a crime.
GIGOT: All right, Judge, thanks very much for being here. Appreciate it.
MUKASEY: Good to be here.
GIGOT: Much more to come as we break down the Comey testimony. Should the former FBI director have voiced his concerns about President Trump earlier or even resigned? Our panel weighs in next.
(BEGIN VIDEO CLIP)
SEN. DIANNE FEINSTEIN, D-CALIF.: Why didn't you stop and say, Mr. President, this is wrong, I cannot discuss this with you?
COMEY: That's a great question. Maybe if I were stronger, I would have.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
SEN. MARCO RUBIO, R-FLA.: At the time, did you say anything to the president about that, it's not an appropriate request? Did you tell the White House counsel that's not an appropriate request, somebody needs to tell the president that he can't do these things?
COMEY: I didn't, no.
COMEY: I don't know. I think, as I said earlier, the circumstances were such that it was -- I was a bit stunned and didn't have the presence of mind. And I don't know, I don't want to make you sound like I'm Captain Courageous. I don't know. If I had the presence of mind, I would have said, sir, that's wrong.
(END VIDEO CLIP)
GIGOT: Florida Senator Marco Rubio Thursday questioning why former Director James Comey didn't immediately report his concerns about President Trump's behavior to the White House counsel's office.
Let's bring in Wall Street Journal columnist and deputy editor, Dan Henninger; Washington columnist, Kim Strassel; and editorial board member, Joe Rago.
Dan, does this self-description of Comey's behavior, I didn't have the self-possession to address the president and tell him that isn't appropriate, does that wash in your mind?
DAN HENNINGER, COLUMNIST & DEPUTY EDITOR: I don't think it washes. It doesn't wash in my mind. And more importantly, it doesn't wash in the American people, everybody who watched that. I would include even Democrats.
There something about the Comey narrative that didn't quite add up, and that exchange with Senator Rubio was a perfect example. Virtually everybody listening to what his description of what went on in the Oval Office, certainly anybody who has been around Washington, would have said, something improper happened there. You're the director of the FBI and he could have walked out of that office and gone to White House counsel and said, the president has just done something improper, let me tell you, you have to go in and explain to him that this sort of thing can't happen, or even have gone to the attorney general. And to say, I don't know, I was so startled, strange.
GIGOT: If he didn't want to go the White House counsel because, oh, well, and he thought the White House counsel's intimidated by the president, the attorney general of the United States is his immediate superior, the deputy attorney general, but then the attorney general, and you should do that. And he said he didn't want to do because he thought, Joe, that the attorney general was going to recuse himself from the Russia probe. Did he know that at the time?
JOE RAGO, EDITORIAL BOARD MEMBER: That's the big question. How did he know that? It's another --
GIGOT: He couldn't have known, because he rescued himself two weeks later, right?
RAGO: Right. Unless he's a fortune teller. His whole narrative is, I was so stunned, I just couldn't -- I couldn't -- I didn't have the composure to do anything, but he goes back and writes a memo to himself, he discusses it with a half dozen of his senior deputies, and then reserves all of this information for himself, doesn't inform the public, doesn't tell any of his superiors. It just doesn't add up.
GIGOT: Let's take a clip with an exchange with Senator Risch and Comey.
(BEGIN VIDEO CLIP)
COMEY: The president of the United States with me alone saying I hope this, I took it as this is what he wants me to do. I didn't obey that but that's the way I took it.
SEN. RISCH, (R, IDAHO: You may have taken it as a direction but that's not what he said?
RISCH: He said, I hope.
COMEY: Those were his exact words, correct.
RISCH: You don't know of anybody who has been charged for hoping, is that a fair statement?
COMEY: I don't, as I sit here.
(END VIDEO CLIP)
GIGOT: Kim, that's crucial to this question of obstruction, as Judge Mukasey made clear. I mean, do you think that looking at all of this there is -- the Democrats are many are going to say this is obstruction, but what about the ultimate impact here? Is that going to play politically, do you think?
KIM STRASSEL, WASHINGTON COLUMNIST: No. I don't. I mean, they're going to try to make it, but this is a pretty devastating blow that Jim Comey ultimately made to the Democratic case that there was obstruction, because you look at the exact words, and he has them there in black and white, and even he had to admit, under testinomy, that the clear meaning of those words "hope" was not a direction. He could take it the other way and Democrats can make a big fuss over that, but it's pretty clear cut on a piece of paper.
GIGOT: All right, Dan?
HENNINGER: Yeah, I want to add one point here. Judge Mukasey just explained to us that impeachment is a political decision, right, by the House of Representatives and the Democrats have been trying to run this offense against Donald Trump as a political event. Jim Comey's appearance was one of the melodramatic political events in Washington in years, and it just didn't live up to its billing. He did not make the case for them in the way they we wanted to that the president had done something in violation of the law.
GIGOT: All right, but there's still political damage, Joe. I agree with Dan's overall summary. He called him a liar. Trump -- if you want to read the worst into it, Trump was trying to subtly imply, hey, do me a favor here, you know. And there's a couple of exchanges, Comey described him as a patronage relationship. Where I don't believe Comey is he's not a babe in the woods, as Judge Mukasey said. This guy, he's a bear-knuckle bureaucratic fighter who knows how to really put presidents in their place, frankly.
RAGO: Right, look, this is a guy, a consummate professional, whose caused crises in every administration in which he served. We had Bush administration over wiretapping under Obama, we had the Hillary Clinton e- mail investigation and his improper exoneration of her in the summer, and now this. It leads me to believe that -- that you're exactly right, that he knows what he's doing. When Trump had this Tony Soprano behavior, like maybe this case -- it would be nice if it went away. Comey was probably thrilled. This is exactly the kind of material that he can use as political insurance.
GIGOT: And he went back and typed the memo and kept it as a form of political insurance. You never know when you're going to need that.
RAGO: No. And he said explicitly that he leaked it in the hopes of prompting a special counsel.
GIGOT: We want to get into it in the next block.
When we come back, the White House goes on offense in an effort to move beyond the Russia probe and keep the president's agenda on track, but is their strategy a smart one?
(BEGIN VIDEO CLIP)
PRESIDENT DONALD TRUMP: No collusion, no obstruction. He's a leaker. But we want to get back to running our great country.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
MARC KASOWITZ, PERSONAL ATTORNEY TO DONALD TRUMP: Mr. Comey has now finally confirmed publicly what he repeatedly told President Trump privately, that is that the president was not under investigation as part of any probe into Russian interference. Mr. Comey's testimony also makes clear that the president never thought to impede the investigation into attempted Russian interference in the 2016 election.
(END VIDEO CLIP)
GIGOT: That was President Trump's personal attorney, Marc Kasowitz, Thursday responding to James Comey's testimony on Capitol Hill. The president himself tweeted Friday, "Despite so many false statements and lies, total and complete vindication. And, wow, Comey is a leaker."
We are back with Dan Henninger and Kim Strassel and Joe Rago.
Kim, I want to address the question of leaks first. And we have Comey talking about how he directed a leak of his memos. Let's look.
(BEGIN VIDEO CLIP)
COMEY: The president tweeted on Friday after I got fired that I better hope that there's not tapes. I woke up in the middle of the night on Monday night, because it didn't dawn on me originally that there might be corroboration for our conversation, there might be a tape, and my judgment was, I needed to get that out into the public square. And so I asked a friend of mine to share the content of the memo with the reporter. Didn't do it myself for a variety of reasons. But I asked him to because I thought that might prompt the appointment of a special counsel.
(END VIDEO CLIP)
GIGOT: Kim, that's pretty remarkable. Not the fact that he leaked through a cut-out, that happens all of the time in Washington, we should tell our viewers that, but the fact that Comey said he deliberately leaked it to trigger a special counsel probe.
STRASSEL: The deliberateness of it, also the ease with which he described the process that he went through to leaking. This is now part of the discussion in Washington, is, was this the first time that he did this? You know, if you think back and you step back, the last six months of drama, almost all of it has come from anonymously-sourced stories, often mostly wrong, but from different members of the intelligence community. And it's a very disturbing question about where all of these are coming from. And it opens up a new question into Comey himself and whether or not he's ever done this before.
GIGOT: It sounds to me that he's looking for political, I mean he really does -- he wants Mueller to be able to nail Trump. That's the implication I take out of this. He wanted that special counsel and he has teed Mueller up to be able to conclude that there was obstruction of justice. That's how I read it.
STRASSEL: Look, if you want to be cynical, you can make the argument, he never corrected the president of what the appropriate behavior should be, instead he went and took all these secret memos and kept building all this dossier, and now he's tossing it all over to Bob Mueller. Maybe that was his goal along to bring down a president.
GIGOT: And, Dan, I don't think there are tapes. Remember when Donald Trump tweeted, you better watch out if there are tapes, and Comey refer to that in his clip there, but Kasowitz now has denied flat-out that Trump ever asked for loyalty so I doubt that there are tapes.
HENNINGER: It doesn't look like it. And it seems the loyalty oath is subset minor issue here.
But there's a couple of things that have gotten sort of joined here that, I think, need to be separated. Comey established that Trump was not the target of an investigation involving the Russian penetration of the campaign. What was involved in this conversation was the probe of Michael Flynn, right?
HENNINGER: And the Michael Flynn probe is not the Russian probe. Flynn may be involved in that, but these are separate things. If he has established that the president was not a target, now we know that, as a matter of fact, unless at some point further on, the new special counsel decides to pull the president into it. But I think that was the big thing that Donald Trump was looking for.
GIGOT: We also have something that came up regarding the Clinton -- the Obama administration, the -- Loretta Lynch was involved. Let's listen.
(BEGIN VIDEO CLIP)
COMEY: At one point, the attorney general had directed me not to call it an investigation but instead to call it "a matter," which confused me and concerned me.
(END VIDEO CLIP)
GIGOT: He said he felt queasy about that and described it as "a matter" anyway. What do you make of that. Sounds like there was a little political pressure in the Obama administration for Comey to downplay the e- mail probe.
RAGO: The contradiction here is, even as Comey sort of conjures up the independent FBI, a sovereign law enforcement agency, is antithetical to --
GIGOT: Under the Constitution.
RAGO: -- democracy and political accountability. If he truly thought the FBI was independent, then Loretta Lynch's political interference in the Clinton investigation should have prompted the exact same kind of blow-up that he had over Donald Trump and the Russia investigation, but it didn't and it suggests that he was more concerned about preserving his job than his professed principles.
GIGOT: So bottom line is that this, it seems to me, that this didn't live up to the political hype but did do some harm to Trump. The real threat to him now, to Trump's presidential future, is Robert Mueller and the special counsel probe, because we never know where that can go. And clearly, Comey was teeing Mueller up to -- to maybe do some damage to the president.
All right, still ahead, Britain's general election ends in a hung parliament in a stunning setback for Prime Minister Theresa May's Conservative Party. What does it mean for Brexit talks? We will have a report from London, next.
GIGOT: A stunning upset in the United Kingdom general election Thursday with British Prime Minister Theresa May's Conservative Party losing its majority in parliament. The vote coming less than three days of terror attacks in less than three months, putting national security front and center in the campaign's final week.
Wall Street Journal editorial page writer, Sohrab Amari, joins us from London.
So Theresa May is --
SOHRAB AMARI, EDITORIAL PAGE WRITER, LONDON BUREAU: Hi, Paul.
GIGOT: -- is going to try, despite being a minority now, is going to try to form a government with the help of the Irish and the Unionists. Is she going to be able to pull that off?
AMARI: Well, the queen has authorized her to try to do that. Obviously now the ball is in her court to be able to, first of all, get a firm commitment from the Democratic Unionist Party, the small Northern Irish Unionist Party --
AMARI: -- and then to be able to both convince them and then to be able to convince her fellow Tories that she's the person to lead the party, and then it all goes to parliament. So it's going to be a mess. And whatever government emerges, and there's still chance that Theresa May will be prime minister when the dust settles, will be fragile and weak and vulnerable.
GIGOT: She went into this election -- she didn't have to call it until 2020. She went into this thinking I will get a much bigger majority, because I have a 20-point lead over Labour. Jeremy Corbyn isn't even popular with Labour voters, all of Labour voters, so this is a perfect time to strike. It seemed, I guess, a reasonable bet but how can he stay as prime minister and leader of the party after she led them into an election against Corbyn and lost seats?
AMARI: Well, that's why I think the Tory's are actually notoriously brutal, the activist base of the party once they feel the Labour leader is in effective. Unlike the Labour side, which for years had hung onto Jeremy Corbyn, who was seen as unelectable, but now he feels triumphant, the Tories tend to be pretty ruthless with leaders they feel aren't working out. So I wonder if -- I image, in fact, I'm certain that the processes are underway to try to think of alternatives, whether that means bringing George Osbourne back to put forward a more traditionally pro-growth, limited government-type Toryism, as opposed to Theresa May's vision to, quote, unquote, "working class Toryism," that emphasized communitarian solidarity and goes after the big, bad business practices and so forth, or --
GIGOT: George Osbourne --
AMARI: -- or it could be Boris Johnson. I don't know. It's all very fluid.
GIGOT: George Osbourne was the chancellor of the exchequer under David Cameron. Now he's out of parliament and even a practicing journalist, god forbid. I don't know if he wants to get into politics. So how did she lose a 20-point lead?
AMRI: Well, I think there's a couple of factors. One is, I think the Brexit focus her government put forward had become tiresome in the sense that Brexit was in some ways a settled question, and yet the focus of her government was, we are going to be tough in Brexit negotiations, whereas, where she came short was putting a vision of, OK, what would a post-Britain look like. And to the extent that she put forward a vision, as I mentioned, it was this idea put forward by a clever but now seems to be discredited campaign guru named Nick Timothy that suggested that Toryism should return to a kind of pre-Thatcher era of emphasizing social solidarity, being OK with raising taxes, and all about regulation, in fact, when government needs to step in when business and markets fall short.
AMARI: And that vision --
GIGOT: Didn't work.
AMARI: Didn't really find buys.
GIGOT: We've got the terror attacks in the last two weeks. What role did that play? And Theresa May had been home secretary, equivalent to Homeland Security secretary here. Did that help or hurt her?
AMARI: I spoke with party insiders ahead of the election and they were so confident that the fact that the country seems to be facing, frankly, a low-grade Islamist insurgency with three attacks in 72 days that that would help her because, for all her other shortcomings, she put herself forward as the steady hand. She wouldn't engage in debates about these issues of security, precisely because it allowed her, she thought, to stay above the fray and appear like the prime minister, and while the rest of them do get out in these petty forums and debates. All of that taken together, they thought would ensure a victory for her because she was facing a guy, who called Hamas and Hezbollah friends, who wants to disarm the Britain's national security apparatus, who doesn't believe in the shoot-to-kill policy when there are terrorists on the streets, and so forth. So given that, they thought she would do well with it. And maybe the reason she didn't do as bad as it could have been was because of the national security shortcomings of Corbyn.
GIGOT: Well, one of the lessons is you cannot take voters for granted. They often surprise you.
So still ahead, amid the Comey furor on Capitol Hill, the GOP fights to keep its agenda on track. So could Senate Republicans unveil their health care bill as early as next week?
(BEGIN VIDEO CLIP)
TRUMP: Across America, premiums are skyrocketing, insurers are fleeing, and the American people are paying much more for much-worse coverage. Obamacare is in a total death spiral. And the problems will only get worse if Congress fails to act. Obamacare is dead.
(END VIDEO CLIP)
GIGOT: President Trump Wednesday urging Congress to act on plans to repeal and replace Obamacare as Senate Republicans continue to hash out their bill behind closed doors. Majority Leader Mitch McConnell reportedly told the president this week that a vote could come by July 4th. Pressure is mounting on the GOP as Anthem, Blue Cross/Blue Shield announced this week that it will pull out in exchanges in many Ohio counties next year, sighting growing uncertainty over the law's future.
We are back with Dan Henninger, Kim Strassel and Joe Rago.
Joe, how much progress are the Senate Republicans making behind the scenes?
JOE RAGO, EDITORIAL BOARD MEMBER: They are making a lot of progress, in the sense that they've studied this issue more than any other. Everybody says they're working as well together as they ever have.
GIGOT: Wow. That's saying something.
RAGO: That's progress.
GIGOT: That's a fractious bunch.
RAGO: At this point, they know what the policies are, they know what the trade-ups are. It's time to make a decision.
GIGOT: And the trade-offs are all geared, from McConnell's point of view, you get to 50 votes?
GIGOT: The problems here, the disputes here about how rich to make the subsidies for the insurance on the exchanges, how much --- what to do with Medicaid in particular, how much authority you give back to the states, and how much money you pay in Medicaid going forward from the federal government, and how much -- how many taxes in Obamacare to cut?
RAGO: Right, it's all about turning those dials, how long of an off-ramp do you have, do you maybe preserve some of the taxes in order to make the subsidies more generous. Ultimately, I think Leader McConnell, he's going to make a prudential decision about what can get to a majority, put it on the floor, have a vote, have accountability. And what he's been telling members is we can either vote for this, defend the success, or we can apologize for a failure. And if we are going to fail, you're going to have to produce a body. If you're going to kill this, we are going to have a vote.
GIGOT: You're going to have a vote.
And, Kim, McConnell is also telling his members, look, if we don't do something on this, Obamacare is going downhill, sliding, we may end up having a debate amongst ourselves in the next year or so about how to bail out the exchanges. And if we make this an issue in 2018 and 2020, what's going to happen is the Democrats, if they get power next time, they will make the same mistake as Obamacare again, they're going to go with single payer.
KIM STRASSEL, WASHINGTON COLUMNIST: Yeah, he's right. This is the point to make because this is just not, by the way, long-term political consequences, you see it happening already. As you get more news like what happened with Anthem this week, you already see Democrats, they're developing new talking points. They are out there saying, look, all of this problem you see in the health care market, it isn't because of Obamacare, it's because of the uncertainty that's being caused by Republicans not doing anything in terms of their reform on the health care bill. So there is an urgency for them to get something out and send a message to the markets to help calm things before this message gets dug in with the left and the public.
GIGOT: Rand Paul, Kentucky Senator, looks like he's not going to vote for anything here. So that is just give one vote to spare. A really narrow margin for McConnell, because Democrats have decided they're going to try to oppose everything that Trump does.
DAN HENNINGER, COLLUMNIST & DEPUTY EDITOR: Yeah, there's a lot at risk right here. You know, the Republicans are trying to do something on the substance. One of the interesting things is they would like to move responsibility from Medicaid out into the states and there's some interesting things going on --
GIGOT: With some still federal funding.
HENNINGER: With federal funding.
GIGOT: With substantial federal funding.
HENNINGER: But the states are already trying to experiment with Medicaid. Just this week, the Nevada legislature passed a bill that would allow people in Nevada to pay to get into Medicaid if they wanted to. You can use Obamacare credits or your own money, if that's what you want to do. I think it was a bad idea but sounds like an interesting experiment. Indiana allows people to put aside money who are on the poverty line to buy their own private insurance. It's been working well in Indiana.
The Republicans have something to argue on behalf of, that the states are better equipped to handle something this complex.
GIGOT: Joe, in the bill that McConnell is putting together, it's not going to be as conservative as the House bill, but it's going to have substantial conservative victories in terms of substantial tax cuts, the evolution of the entitlement, the most substantial reform of Medicaid in a long time, maybe ever, and significant reform of the exchanges. The question is, will conservatives accept that as enough?
RAGO: Yeah, that's the big question. Are they going to decide to govern, to make directional progress on -- on their policy goals, or try to defeat this? I think that's a real question. When you have the House bill come out first, the right hit it hard. They're going to have to, I think, be more pragmatic in this case to have any hope of forward advance.
GIGOT: All right, Joe, thank you.
When we come back, President Trump unveils a plan to privatize America's air traffic control system. What it could mean for your future flights.
(BEGIN VIDEO CLIP)
TRUMP: -- on time.
(END VIDEO CLIP)
GIGOT: That was President Trump on Monday kicking off what the White House dubbed infrastructure week. The president unveiling a plan to privatize the nation's air traffic control system, spinning it off from the government-run Federal Aviation Administration to a nonprofit, a move the administration says will make air travel safer and more efficient.
Robert Poole is director of transportation policy at The Reason Foundation. He had advised four presidential administrations.
Welcome, Mr. Poole. Good to have you here.
A lot of Americans think that air travel, the experience is getting worse. What role does the air traffic control system play in that deterioration?
ROBERT POOLE, DIRECTOR OF TRANSPORTATION POLICY, THE REASON FOUNDATION: Well, the air traffic control system is behind the times in terms of its technology. It does not offer the same kind of advanced technologies that enable planes to fly closer together safely and, therefore, get better use out of the air space. And so it does contribute to delays, particularly 40 percent of all the delays occur because of the New York-New Jersey air space near New York City, and that is a terrible mess which the FAA has made a very low priority to solve. And yet, if it were customer-driven, responding to the real needs of its aviation customers that would be a very high priority. They would be working on that right now.
GIGOT: The FAA knows this technology exists. Global positioning system technology is not new. It's been around for a long time. Why does the FAA have such a hard time implementing these kinds of advances?
POOLE: A number of reasons. One, they can't do revenue bond financing to large-scale procurements because they have to operate on annual allocations from Congress --
POOLE: -- unlike the air traffic corporations in 60 other countries.
Secondly, they have a god-awful procurement system. Some members of Congress, some Democrats, said it's even worse than the Department of Defense's procurement system.
GIGOT: That's saying something.
POOLE: It takes forever to build things, to design things, build things and get them out into the field. Many of these cases, by the time something hits the field, not only does it not work right the first time, but it's about 15 years past when they started defining it, and it's no longer even state-of-the-art.
GIGOT: OK, the question is, you mentioned 60-some countries have something like this.
GIGOT: So, this move to a nonprofit has been tried by other countries. What's the experience, for example, in Canada?
POOLE: Canada is one of the best examples. Canada has -- it's 20 years old. Completely supported by user payments. It's basically a utility run as user co-op, with the stakeholders from aviation on the governing board. No micro management by the Canadian parliament. And it issues revenue bonds, have an investment-grade bond rating. And it has technology that puts FAA to shame. They have digital pilot controller messaging across the country and across the entire north Atlantic, which we don't have yet, and won't have for another eight years on a nationwide basis. They have -- they are putting in global satellite surveillance through an entity that they created called Aerion (ph), that 70 percent of the world's earth surface doesn't have a radar. Planes are just out there and they have to have huge buffer zones around them because the controllers don't know exactly where they are. But with satellite-based surveillance, starting in 2018, will know exactly where they are over the ocean, just like we know over land. Yet, the FAA itself has not signed up to subscribe to this, even though FAA is responsible for huge amounts of oceanic air space.
GIGOT: So the opponents of this, one of the questions they raise, well, what about safety. If you are going to fly these planes closer together, you're going to take risks, if you're not going to have -- if you are going to rely on technology, isn't there a danger, greater risk to passengers? What's your response?
POOLE: The response to that is the United States is the one that's in a high-risk operation because we don't have transparency between safety regulation and service provisions. The International Civil Aviation Organization, in 2001, said these two functions, safety regulation and ATC service provisions, should be at arm's-length organizationally. The United States is the few countries in the whole world that has not made that separation. And that's one of the reasons why 60 countries over the last 30 years have separated the two organizationally.
GIGOT: OK. It's such great idea -- and I like it. I've been supporting this -- we have been sporting this at "The Journal" for more than 20 years. Why --
POOLE: I know that.
GIGOT: -- is there so much opposition to this politically? Why is it --
POOLE: Yeah. A lot of it is a turf battle. Members of Congress really enjoy having the ability to direct, tell the FAA what to do and what not to do. One of the problems, for example, is the FAA has over 500 facilities around the country, not only control towers, but 20 big centers that control high-altitude flights spread across the country. With today's technology, they can probably do that with three or four --
POOLE: -- that would be completely be backing each other. And yet, you can't -- it's almost impossible to close facilities in somebody's district. And so you get these kinds of colloquial concerns that prevent the kind of modernization that we really should have and that other countries, with air traffic corporations, are doing. Australia has done this. Germany has done it. The U.K. has done it.
GIGOT: OK, so let's hope we can break the gridlock.
Thank you for being here.
POOLE: Thank you.
GIGOT: We have to take one more break. When we come back, "Hits & Misses" of the week.
GIGOT: Time for "Hits & Misses" of the week.
Sohrab, start us off.
AMARI: A hit, Paul, to Nikki Haley. The U.S. ambassador to the United Nations, this week issued a statement this week saying the U.S. will no longer tolerate the bullying of Israel at the United Nations. This is a welcome break from the Obama administration, which had either tolerated it or, in some cases, shamefully joined in with the U.N. jackals who try to use the U.N. forum to try to distract from their own despotic records and beat up on the world's sole Jewish state. So this was one of those reasons to cheer the Trump administration and the dramatic foreign policy break that it represents with its predecessor.
GIGOT: All right, Sohrab, thanks.
STRASSEL: A hit, Paul, to Michael Bloomberg, whose philanthropic arm said it would be sending $15 million to the U.N. to make up for money lost from Trump withdrawing from the Paris Accord. I love this model. We have all of these billionaires and celebrities who have their pet causes but expect taxpayers to pay for it. This way, everyone wins. These get to ease their conscience, the U.N. gets the money, taxpayers keep their dollars. Hurray.
GIGOT: All right, Kim.
RAGO: Another hit. This one for the secretary of the Interior, Ryan Zinke, who took the first steps this week to de-list the great sage grouse as a protected species. This is basically a glorified chicken. It's not endangered. It's not adorable. But the Obama administration used it as a pretext for land management plans that lock up about 60 millon acres out west, no development whatsoever. This is a victory for rationality over political environmentalism.
GIGOT: And, Dan?
HENNINGER: Paul, I've got a hit for one of the Democratic Party's greatest villains, the U.S. energy industry. We have now, it's been reported that the United States is now exporting, exporting a million barrels of oil a day. There was a time when tankers would come from the Middle East to Texas, unload the oil and go back empty. They're now filled with American oil, dropping it off in Europe. This is a great story of American innovation and entrepreneurship, and we should hail it.
GIGOT: Thank you all.
That's it for this week's show. Thanks to my panel. Thank you for watching. I'm Paul Gigot. We hope to see you right here next week.
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