This is a rush transcript from "Your World with Neil Cavuto," July 3, 2008. This copy may not be in its final form and may be updated.

NICOLE PETALLIDES, GUEST HOST: Moving on, on this topic, a very similar topic, we're going over to Newt Gingrich, urging all Americans today to make this Fourth of July a day the drill-nothing Congress will not forget.

He is declaring tomorrow energy independence day and is urging anyone who wants to see lower prices at the pump to sign his online petition, forcing lawmakers to drill now.

The former speaker of the House is on the telephone right now. And he's currently chairman of American Solutions. Mr. Speaker, Speaker Nancy Pelosi — well, thank you for joining us, first and foremost.

NEWT GINGRICH, FORMER SPEAKER OF THE HOUSE: Well, I am delighted to have a chance to be with you.

And all of our listeners and viewers have to ask themselves the question, given the briefing you just got, if China is going to continue to grow — and it is — if India is, if it is, if all the secondary countries in the Third World are going to grow — and, hopefully, they are, because we want prosperity everywhere — then the demand is going to go up. If the demand is going to go up, unless you have a substantial increase in supply, prices are going to continue to skyrocket. Now, where could you get an increase in supply? Well, it is currently illegal to look in the Atlantic Ocean off of the U.S. It is illegal to look in the eastern Gulf of Mexico in the U.S. It is illegal to look in the Rocky Mountains, where we believe that there's three times as much oil in the shale oil as there is in all of Saudi Arabia.

And it is illegal to look in the Pacific and it is illegal to look in northern Alaska. Now, if you have nationalized all of the most likely areas for energy, and then you have failed, as the Department of Energy has failed, to develop a clean coal technology, and if the Congress has failed to pass a long-term tax credit for solar power, and if there has been no provision for a tax break for companies to go to flex-fuel cars — we have had an energy strategy.

The energy strategy is to make the American people pay radically more. They have to buy smaller and smaller cars, or use motorbikes, or ride mass transit. It has been a deliberate strategy. And the Congress has to change. It has got to decide that it is OK to drill here, drill now, and pay less. And that is only part of a comprehensive strategy, but it is a significant step in the right direction.

And, by the way, Marty Feldstein, who was the chairman of President Reagans' Council of Economic Advisers, has written an article recently point out that the minute the U.S. announces it's going to start looking for more oil, it's probable that the price will start to come down, because there's a lot of expectation built into the price of oil.

PETALLIDES: Right. Well, I'm sure a lot of people would like to hear that. I want to take a listen to Harry Reid, who — there's a — coal makes us sick. Let's listen to this together. Then we can comment on it, Mr. Speaker.


SEN. HARRY REID, D-NEV., MAJORITY LEADER: Coal makes us sick. Oil makes us sick. It is global warming. It is ruining our country. It is ruining our world. We have got to stop using fossil fuel.


PETALLIDES: (AUDIO GAP) ... of that? What do you think of what Mr. Reid just said?

GINGRICH: Well, look, I was just in Las Vegas.

Las Vegas is a city which does not exist without tourism, and Harry Reid's policy is destroying the airlines. Las Vegas is a city which does not exist without air-conditioning. And Harry Reid's policies are going to drive the price of electricity sky-high.

Las Vegas does not exist without the automobile. And Harry Reid's policy is going to bankrupt Las Vegas. At some point, people in Nevada have to turn to Harry Reid and say, look, if you can produce a magic vehicle tomorrow morning running on hydrogen, we are thrilled. But, in the interim, don't bankrupt us.


PETALLIDES: You have a big list. Over 1.2 million Americans have actually signed the drill here, drill now, pay less petition, many of which are senators, representatives, congressmen, as well.

I wanted to ask you, Mr. Speaker. Speaker Nancy Pelosi just said today that we cannot drill our way to independence. What is your reaction to that?

GINGRICH: Well, it is just factually false.

The Brazilians just went from 10 billion barrels of proven reserve to 900 billion barrels of proven reserve, a 900 percent increase, because they actually allow to look in the Atlantic, where they found two reservoirs that are huge.

The U.S. Geological Survey just increased their estimate of the amount of gas and oil in western North Dakota and Eastern Montana by 2500 percent. The Hungarians just increased their estimate of the amount of gas in one of their natural gas fields by 400 percent.

With modern technology and new opportunities, I believe that, in the short run — short run is 20 or 25 years. This is a transition problem. There are 240 million cars and trucks in the U.S. that use gasoline, diesel, may use ethanol and soy diesel.

PETALLIDES: Do we need to cut back as a nation, do you think?

GINGRICH: I think we — no. I think — my goal would be to have us have lower-cost energy and have us transition to better technologies that produce better results.

Historically, we are not a country which has believed that we ought to punish the American people to get into the future. We're a country...

PETALLIDES: How long does this take? Quickly, just quickly, how long would it take, if we start drilling, to actually have our prices drop and have the barrels pumped out?

GINGRICH: Well, if you included with that selling off about a third of the Strategic Petroleum Reserve at two million barrels a day, my guess is you could bring down prices in the summer, the beginning point, and if people thought you were serious, I think you would see prices continue to come down.

PETALLIDES: All right, Mr. Speaker, thank you so much for joining us.

GINGRICH: Thank you.

PETALLIDES: We appreciate your time.


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