This is a rush transcript from "Journal Editorial Report," June 17, 2017. This copy may not be in its final form and may be updated.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We may have our differences, but we do well in times like these to remember that everyone who serves in our nation's capital is here because, above all, they love our country. We can all agree that we are blessed to be Americans, that our children deserve to grow up in a nation of safety and peace, and that we are strongest when we are unified.
(END VIDEO CLIP)
PAUL GIGOT, FOX NEWS HOST: Welcome to the JOURNAL EDITORIAL REPORT. I'm Paul Gigot.
That was the president Wednesday responding to the shooting in Alexandria, Virginia, that injured House majority whip, Steve Scalise, and four others.
The rampage which unfolded as Republicans practiced for the annual congressional baseball game sent shockwaves through Washington and prompted calls for unity from the leaders of both parties.
(END VIDEO CLIP)
REP. PAUL RYAN, R-WISC., SPEAKER OF THE HOUSE: I ask each of you to join me to resolve to come together, to lift each other up, and to show the country, to show the world, that we are one House, the people's House, united in our humanity. It is that humanity which will win the day, and it always will.
REP. NANCY PELOSI, D-CALIF., HOUSE MINORITY LEADER: I pray for Barack Obama. And now I continue to pray for him. And I pray for Donald Trump, that his presidency will be successful, and that his family will be safe.
(END VIDEO CLIP)
GIGOT: Joining the panel this week, Wall Street Journal columnist and deputy editor, Dan Henninger; and columnists, Mary Anastasia O'Grady and Bill McGurn.
Mary, I think one of the clear lessons of this, if there is any lesson from a horrible incident like this, is the rampage and carnage would have been so much worse if you had not had those two officers armed and ready to take on that gunman and risk their own lives.
MARY ANASTASIA O'GRADY, COLUMNIST: I think that would be the first point we have to make. Not only were they there and to do their job, but they acted, you know, really heroically. And Crystal Griner actually took a bullet to the lower leg and kept firing. All of the reports are that they saved a lot of lives.
GIGOT: The interesting thing, Mary, we see Steve Scalise, we see congressional leaders, they come with their security detail. But it is only the leadership that has that security detail. So the other members were really lucky that Steve Scalise was there himself as a member of the leadership and had the security detail.
O'GRADY: Right, and one of the members had said he was on his way to his car when the gunman came up to him and asked him who was practicing on this field, are they Republicans or Democrats? And he said that is the Republican team. Obviously, not thinking anything. The guy then went to his car and got his weapon. So he was clearly out for a lot of Republicans and he was not necessarily gunning for Steve Scalise.
GIGOT: Dan, politically motivated, very clearly, now, we can see through his Facebook posts and so many other things. Hodgkinson hated Donald Trump, hates Republicans, hated Republicans.
DAN HENNINGER, COLUMNIST & DEPUTY EDITOR: Yeah, I think what we have to focus on here now is, sure, there is a lot of political intensity out there, a lot of intense political rhetoric, but beneath it, there is enormous emotional and psychological intensity that is going out there in politics right now.
GIGOT: What do you mean by that, Dan? How is that different from normal times?
HENNINGER: In normal times, it's like we have these town hall meetings. They're not just town hall meetings, they're full of angry over-the-top people. On campuses, for the next several years, you've had not people talking to one another but shouting down.
GIGOT: Saying you can't talk.
HENNINGER: You can't talk. So something has changed in the environment out there. I think it is the intensity of emotion. It has a lot to do with social media. People disappear into their Twitter and Facebook accounts and they sort of feed on this sort of thing. The problem is we are getting into dangerous and deep water with that. Political violence has a mystical attractiveness and I think Hodgkinson put that together in a way that, I will say, Speaker Nancy Pelosi put her finger on it, we all worried the length of the Obama administration about something like this happening. Thank god it didn't. And now this sort of thing is back in the waters. It's bad.
GIGOT: But, Bill, I -- just looking at the way that the political class in Washington behaved this week in response -- I thought Donald Trump was great, OK, I mean, he was excellent, as good as I have seen him, responding to an event. And he did it throughout the week. I thought the congressional leadership responded very well. I thought Bernie Sanders responded very well, repudiating the supporter. So will it stay? Probably not. But I thought they did very well this week.
BILL MCGURN, COLUMNIST: Yeah. I mean, this is also different and embarrassing to a lot of people in Washington. It comes at a time when we have a play where Donald Trump gets assassinated --
GIGOT: This is Shakespeare in the Park!
GIGOT: Julius Caesar -- made the play "Julius Caesar" -- it was "Julius Caesar made to look like Donald Trump.
MCGURN: Remember, there is a long history of this. John Wilkes Booth knew Julius Caesar by heart, made an illusion to that when he shot Lincoln. In his diary, he called himself Brutus, you know, right before he was caught.
So this is embarrassing. Look, Bernie Sanders, when Gabby Giffords was shot, put out a fundraiser blaming kind of right-wing Republican reaction and false narratives, and so this is very embarrassing. It proves it can hit any side on this. And I, as Dan was saying, I think we need to lower the temperature. People need to be more careful.
But without blaming, look, at the end of the day, the blame for the shooting goes on the man behind the rifle scope and pulling the trigger.
O'GRADY: Yeah, I think there's one other thing here worth bringing up, which is that government has more power probably, the federal government has more power than it ever has, so that means the stakes are very high.
GIGOT: In politics, in the state of politics?
O'GRADY: Yes, and I think that explains why the rhetoric gets so heated and people feel like there is so much to lose if their side does not win.
Because there's a kind of winner-take-all. If we win, we are doing it our way. And 17 percent of the U.S. economy basically run by the federal government in the ObamaCare. That makes people feel desperate on both sides.
GIGOT: Dan, you said this week, Shakespeare in the Park should shut down the production. You also predicted they will not. You were proved right within about 12 hours.
HENNINGER: Yeah, they refused to. And you know it is because I think both the left and the right are driving emotions for political reasons now. But I think we have to admit the anti-Trump hysteria is like nothing we have ever seen in our politics in a long time. I think the people behind it have got to recognize that what happened here in Virginia, the shooting of Mr. Steve Scalise, was a dangerous portent and it is time to tone it down.
GIGOT: All right, thank you all.
When we come back, with the Russian probe reportedly inching closer to the Oval Office, President Trump accuses special counsel, Robert Mueller, of conducting a witch hunt. The very latest, when we come back.
GIGOT: "Outrageous, inexcusable and illegal" -- that was Team Trump's response this week to leaked reports that Robert Mueller is now investigating the president for possible obstruction of justice. "The Washington Post" saying that Trump, as well as his son-in-law, Jared Kushner, are now part of the special counsel probe, which was quickly expanded beyond questions of Russian interference in the 2016 election.
The president responded late this week calling the investigation a "witch hunt" and tweeting, quote, "They made up a phony collusion with the Russian story. Found zero proof. So now they go for obstruction of justice on the phony story. Nice."
We are back with Dan Henninger, Mary Anastasia O'Grady and Bill McGurn.
Bill, let's put this Mueller news in context. Where do you think this is going? How do you read these leaks?
MCGURN: This is part -- I think Donald Trump has a case. This is part of the swamp. The special prosecutor was a bad idea. Now it seems to be morphing well beyond its original purpose. He is hiring more people.
There are leaks coming out of it. I think Donald Trump has a point. I think the point would be better made by other people, if you let other people defend himself against it. But this is the position: This is a bad idea, but it would be bad for Donald Trump to fire Mr. Mueller because of the politics. That is a really bad equation that we have, Paul.
GIGOT: To be fair, we don't know, Dan, where the leaks are coming from. Could be counsel's office, or they claim what we have button-down procedures and punishment for anybody who leaks. But again, you have FBI agents working on this. You've got lawyers from people who are interviewed. All of these people are talking. And the danger is, with anonymous sources, you never know what to believe. As we learned with Comey's testimony, sometimes what CNN and "The New York Times" reported was simply false.
HENNINGER: Yes. The possibilities are endless. We are in very familiar territory here with the special counsel, because the special counsel, it is not a witch hunt but it is a dragnet. They're going to look at everything.
GIGOT: That is a very good thing for them.
HENNINGER: They will start from when Trump entered politics in June 2015, and they will request every document, every e-mail, any aspect of any business relationship that Donald Trump or Jared Kushner might have had. That is the way prosecutors operate.
HENNINGER: And there will endless leaks out of this process.
GIGOT: I think they go back deeper than that. I think they go back to any ties Russia has ever had in business, with Russia, all of that.
HENNINGER: I don't think we've ever had a special counsel looking into something that was so open-ended and so unclear. I mean, there is, so far, no evidence that there was collusion between Trump. We do know that there was Russian meddling in the election, as happened in western Europe. That is a counterintelligence investigation.
GIGOT: Go ahead, Mary.
O'GRADY: I was just going to say that the problem with this dragnet is that we have experiences in the past with independent counsels and I think Patrick Fitzgerald's work when he was supposed to be investigating who leaked the name of Valerie Plame, they found a very early in the investigation.
GIGOT: Within a week.
O'GRADY: They didn't care. They just kept going. So they are known to sort of like monsters that take over and just keep consuming whatever they can find in order to get a win. And of course, that is how Scooter Libby got caught up in something that really had nothing to do with what Patrick Fitzgerald was supposed to be looking for.
Everyone says Mueller is an honorable guy. He's a military veteran. He's was honored for valor, Bill. On the other hand, he is picking some junkyard dogs for his staff.
GIGOT: Andrew Weissmann, he was the guy who helped put Arthur Anderson out of business. A conviction that was later overturned as unconstitutional by the Supreme Court.
MCGURN: Right. I think it stinks to high heaven. I think if you have that job, you have a responsibility to look objectives as well. It does not look that way. You know, people say they are professionals, but the second point about that is, I remember when Loretta Lynch was in charge, and they said, no, they're all professionals at the DOJ. Well, we know the DOJ, in the past, has been in the past highly politicized. I think this is a really, really awful signal to the country, this open-ended thing. A prosecutor is supposed to investigate a known crime, not search for a crime.
GIGOT: OK, let's talk about whether he should fire Robert Mueller, Donald Trump. The reports were that he thought about the idea. His tweets suggest he has thought about the idea. But is it prudent?
O'GRADY: I think the optics would be really bad at this point.
GIGOT: The politics?
O'GRADY: Yes, the way we look. It will look bad because it would look like he doesn't want the investigation to succeed and somehow imply that he is guilty. But I also think that part of the big problem, as I said before, is the process. This idea that whoever is in that job can just sort of throw out this net and fish for anything. And it can go on for an extended period of time, which is another objective of the Democrats. They want this on the table, consuming oxygen from the room for as long as possible, and certainly, to affect the midterm election.
GIGOT: Every leak that comes out of the counsel's office, Dan, they are dancing in the streets --
GIGOT: -- the Democrats, they are so thrilled with this.
HENNINGER: I think, as a result, Republicans have got to resist being intimidated by this investigation. It is like hands off, let the special counsel go forward. They are in a political death struggle here with the Democrats and with the Beltway press. I think Republicans --
GIGOT: Are they going to have to defend Trump against Mueller, or attack Mueller? Is that wise?
HENNINGER: I think -- I think they will have to do both, when appropriate. They're going to have to push back against the idea that there is this inexorable force taking place that will take down a presidency. Their political interests are at risk here, too, and at stake.
GIGOT: Thank you all.
When we come back, charges of stonewalling from Democrats as Attorney General Jeff Sessions refuses to answer questions about his conversations with President Trump. So, was he right to do so?
(BEGIN VIDEO CLIP)
JEFF SESSIONS, U.S. ATTORNEY GENERAL: I am not stonewalling. I am following the historic policies of the Department of Justice.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
SESSIONS: I am not stonewalling. I am following the historic policies of the Department of Justice. We don't walk into any hearing or committee meeting and reveal confidential communications with the president of the United States, who is entitled to receive confidential communications and your best judgment about a host of issues.
(END VIDEO CLIP)
GIGOT: That was Attorney General Jeff Sessions during his testimony Tuesday before the Senate Intelligence Committee, defending his decision not to answer questions related to his private conversations with President Trump. So did have a legal basis for his refusal?
Let's ask George Terwilliger. He served as deputy attorney general and acting attorney general under the first President Bush.
So, Mr. Terwilliger, welcome. Glad to have you here.
GEORGE TERWILLIGER, FORMER DEPUTY ATTORNEY GENERAL & FORMER ACTING ATTORNEY
GENERAL: Thank you.
GIGOT: Let me ask you first about this question of executive privilege that the Democrats are saying Jeff Sessions is hiding behind. Is Jeff Sessions right that this is normal procedure?
TERWILLIGER: He is absolutely right, Paul, because the privilege belongs to the president. And it is much like, if an attorney, if a client told me something in confidence and then I am called before some body and asked about that communication, the client may have the right to waive that attorney/client privilege, but I don't on my own. The same is true with executive privilege. Subordinate officials, advisors to the president have to honor the privilege, unless and until the president says, yes, you can talk about that. And you can't anticipate that because, going into the hearing, you don't know for certain precisely what questions you're going to be asked.
GIGOT: Other attorney generals have cited this practice. I think, didn't Eric Holder, as I recall, behave somewhat in similar fashion when he was asked to testify?
TERWILLIGER: Even more adamantly claiming privilege as to documents that eventually became the subject of a court case. You know, Paul, this is part of, there may not be a legal policy document in the Justice Department archives that exactly lays this out. There are different bits and pieces here and there. But anyone who has worked in the department understands that it is part of the great policy, by practice, of the way the department conducts its business.
GIGOT: Let me ask now about these leaks we are getting out of the special counsel's office, suggesting that Robert Mueller is investigating now and the president for possible obstruction of justice, Jared Kushner's financial and business dealings. I mean, I've been around long enough, as you have, to know that this thing happens, but it really looks bad, does it not, to have these leaks about what is being investigated?
TERWILLIGER: It more than looks bad, Paul, it is reprehensible. It's truly reprehensible, particularly when the leaks are obviously aimed at undermining the presidency and the president's authority and his ability to conduct the nation's business. But I will say this. Bob Mueller and I served in the Justice Department together when I was the deputy attorney general. He ran the Criminal Division. We were the victim of leaks. I know how Bob feels about leaks. And I am sure he is as upset about this as anyone else.
GIGOT: Well, here's a question I have. You were a deputy attorney general. This deputy attorney general, Rod Rosenstein, appointed Mueller as the special counsel. There's a lot of criticism I hear about that decision, not just because of the fact of a special counsel but because of the close ties going back, as colleagues, many, many years between James Comey, the former FBI director, and Robert Mueller. They worked together.
They threatened to resign together. Does that, in your mind, suggest a potential conflict of interest?
TERWILLIGER: I think it suggests a factor that the public, frankly, will take into consideration in making a judgment. But the larger judgment will be made based on how Bob conducts this investigation. Again, I think -- I know Mr. Mueller very well and I don't think he is going to let any prior association get in the way of his best judgment. I think those of us who know Bob may think his year may not be finely tuned to the political music, but that is part of his charm here.
GIGOT: All right, so what duty does Rod Rosenstein, the deputy A.G. -- keep in mind the Attorney General Jeff Sessions has recused himself from this. But what duty does Rosenstein have going forward to supervise Mueller if he sees things are running off the rails?
TERWILLIGER: That is an excellent question. This is not an abdication of Mr. Rosenstein's role as the acting attorney general and, thus, the ultimate responsible party for this investigation. And, indeed, he issued a statement last night urging the public and everybody else concerned not to take leaks from anonymous sources too seriously. I'm sure he is as upset about these leaks as anyone else. And I think his caution in terms of putting too much weight into those reports is well taken.
GIGOT: All right. Let me ask you, can the president, does the president of the United States have the legal authority, if he wants, to fire a special counsel?
TERWILLIGER: Yes. The president -- we have a unitary executive. The president is in charge of everybody in the executive branch, including special councils. Normally, if a president wanted to do that, he would call up the acting attorney general, Mr. Rosenstein, and say, I want Mr. Mueller dismissed. But I seriously doubt that this is anything but a hypothetical discussion.
GIGOT: All right. You think it would be a bad idea politically to do so?
TERWILLIGER: Yes, it would be a very bad idea right now. Look, I think this, on this obstruction business that has been reported, if you look at the reports closely -- and that is the only knowledge I have of this is what is publicly reported -- this was going before Mr. Mueller came on the job. So as was discussed earlier in the program, the fact is Mr. Mueller will feel obligated to run those leaks down, to talk to the appropriate people. But I would not read anything more into it than exactly that at this point.
GIGOT: Thank you very much, George Terwilliger, for being here.
TERWILLIGER: Good to be with you.
GIGOT: Still ahead, a closely watched gubernatorial primary in Virginia offers valuable lessons for both Republicans and Democrats heading into the 2018 midterms.
PAUL GIGOT, FOX HOST: A closely watched gubernatorial primary in Virginia this week serving up some lessons for both parties heading into 2018.
Democrats turned out in record numbers Tuesday uniting around the moderate candidate, Lieutenant Governor Ralph Northam, who handily defeated Tom Perriello, a former congressman backed by Senators Bernie Sanders and Elizabeth Warren. And on the Republican side, former RNC chairman and establishment favorite, Ed Gillespie, squeaked out an uncomfortably close win over former Trump state chairman, Cory Stewart.
We're back with Dan Henninger and Bill McGurn. And "Wall Street Journal" editorial page writer, Alyssa Finley also joins us.
Dan, what is the main message of the Virginia primaries?
DAN HENNINGER, COLUMNIST & DEPUTY EDITOR: Let me run through it. After the Democratic primary, Ralph Northam and Tom Perriello said we are united as one to defeat Ed Gillespie in the general election. After the Republican primary was over, Cory Stewart said this, "There is one word you'll never hear from me and that is unity."
Unless Gillespie comes across to his point of view. So in other words, the Republicans are intent on remaining divided.
HENNINGER: They're generally divided. Virginia has 13 electoral votes. If they allow that state to go Democratic, they'll have a tough time losing presidential elections. So you have to wonder what people like Cory Stewart are thinking when they say, we can't support our candidate.
GIGOT: Let's talk, Alyssa, about the Democrats first, because the turnout was enormous. The last time you had a competitive race, 2009, only 320,000.
ALYSSA FINLEY, EDITORIAL PAGE WRITER: Right. And now you have over 500,000. And where Republicans should be a little worried, they had a 40 percent turnout compared to the Democrats, who had a 60 percent turnout.
FINLEY: Republican turnout was pretty low in the D.C. suburbs area. That really hurt Gillespie.
GIGOT: That is where -- that's a huge vote, for one thing, and it has been trending left.
FINLEY: Right, it's been more affluent and education. Traditionally, it's groups that favor Republicans. But this also plays into the Georgia sixth district. Very similar.
GIGOT: The message, Bill, the Democrats are fired up. They want to just get out. They'll vote for anybody.
BILL MCGURN, COLUMNIST: Right.
GIGOT: And they're even -- and this is crucial. You know, there is a lot of talk in the press about how the Democrats will be moving left and they'll have disrupted primaries. Well, they had a primary here, and as Dan suggested, they are now joining hands and uniting to paste a defeat on, not just Gillespie but really Donald Trump.
MCGURN: They're making the campaign about Donald Trump. It's probably a good message in Virginia where Trump lost by, what
GIGOT: 5 percent, yeah.
MCGURN: -- 5 percent or so. That is a message that can resonate there. I think if anyone could squeak it out, it's Ed. Ed is an old friend of mine, a colleague at the White House. I knew him for 30 years before that. He is a happy warrior. He is as conservative as they come. Any kind of attack that he is some kind of rhino, people don't know Ed Gillespie. But it's a challenge for him when part of the party is saying they won't come together.
GIGOT: And Cory Stewart, Alyssa, a large part of his campaign, he was running against the closure of Confederate monuments. Now I don't like repudiating history either. But you know, how many voters are going to vote on a Robert E. Lee memorial?
FINELY: Right. Basically, a lot of people were unhappy that Ed Gillespie really was distancing himself from Donald Trump. Those Trump voters in the rural areas of Virginia, I think they're still fired up.
GIGOT: Let's talk about Georgia. The big race next week, Jon Ossoff, the Democrat, running against Karen Handel, the Republican, very close in the polls. One poll I saw by the Terrance Group has Ossoff up three in a district that's been held previously by Republicans for many years.
FINELY: Right. Mitt Romney won it by over 20 points. Tom Price, who just was made the Health and Human Services secretary, he held it for over a decade, the last one over 20 points. This is, again, a traditionally Republican district.
GIGOT: So why are the Democrats so competitive?
FINLEY: I think a lot of Republicans are feeling demoralized, especially in an educated, suburban, affluent district. They don't really see Republicans accomplishing much.
HENNINGER: Also, Alyssa, Jon Ossoff is running as a centrist. He's saying he's against single-payer, which is a sacrament for Democrats. He's saying, I don't want to raise income taxes on the rich. And yet, the Democrats are supporting him and giving him millions of dollars in financing.
GIGOT: I think he has raised 23 bucks so far.
HENNINGER: But I think the Republicans have to be worried about this campaign, because if Jon Ossoff pulls this off in a Republican stronghold, as Alyssa just described, they will run this campaign in collar counties, upper-middle-class suburban counties, all over the country against Republican candidates.
MCGURN: Paul, I just want to add, I think, didn't Hillary come within 1.5 points?
GIGOT: Yes. Correct.
MCGURN: So the idea that this is this Republican district, overwhelming, you know, the polls are running consistent with the election.
Look, I think the second point, and it applies to Ed Gillespie, for Republicans running around the country, they are facing a Democratic Party united by anti-Trump fever. And Donald Trump needs to give these people some reasons to be for them. And, you know, I sound like a broken record, but that means getting health care done and getting the tax cuts done so that they can attach themselves to a record and not just --
GIGOT: And not have to talk about Russia and Trump all the time.
GIGOT: But this is what we did, A, B, C.
MCGURN: Exactly. Exactly.
GIGOT: All right. Still ahead, President Trump rolls out his apprenticeship plan in Milwaukee, so will it bridge the skills gap between employers and job seekers? We will ask Wisconsin Senator Ron Johnson, next.
(BEGIN VIDEO CLIP)
DONALD TURMP, PRESIDENT OF THE UNITED STATES: During my campaign for president, I talked about crucial importance of vocational training, teaching young people the skills, crafts and trades that are vital to the economy and our success as a country, and their success as an individual.
(END VIDEO CLIP)
GIGOT: That was Donald Trump in Milwaukee on Tuesday kicking off a White House push to expand apprenticeship programs. The plan, laid out this week in an executive order, aims at closing the so-called skills gap by training workers for jobs that companies are struggling to fill in states across the country.
Earlier, I spoke with Republican Senator Ron Johnson about the labor shortage in Wisconsin.
GIGOT: You and I talked after the election, and you said something that stuck with me, which is that as you traveled the state, running for reelection, you had heard from manufacturers and small businesses, and you said that there wasn't a single manufacturer in the state that could find the number of skilled workers that they needed. Is that still true? And what is the problem?
SEN. RON JOHNSON, R--WISCONSIN: First of all, Paul, it dates way, further back than just my election. I have been in manufacturing for 30 years. I would say, for 20 years in Wisconsin, it has been difficult to find people to work in manufacturing. In the six years I have been in the United States Senate, I traveled the state, touring manufacturing plants, there has not been I toured, that I visited that can hire enough people.
This has been a pervasive, very long-term problem. I attribute it to two things, primarily. First of all, we pay people not to work, which is a real problem.
GIGOT: OK, that's incentives.
JOHNSON: That's incentives. And secondly, we have been telling our young people for decades you have to get a four-year degree. Think about that.
What does that imply? That working in a factory or being a plumber or a carpenter or an electrician, that is second-class status? Nothing can be further from the truth. What I think about is great about these apprenticeship programs is we have our children, $1.4 trillion collectively in debt. On average, about $30,000 per student in debt. People are coming to the realization that the trades -- working as a carpenter or a plumber or manufacturing, they are great jobs. They are great careers. And their starting to open up their minds to different alternatives than just a four- year degree.
GIGOT: So you like the president's apprenticeship initiative here where he is rolling out this executive order saying he is going to make it possible for the Labor Department to ease the rules on trade groups and others that want to create apprenticeship programs?
JOHNSON: Absolutely. Paul, look at what a disservice we've done to young people that really didn't know what they want to do, trying to go to college. They get themselves in debt, they don't get a degree, and then they go work a manufacturing facility and they find themselves a real good career. So why don't we, first, by providing our children with information on all of their options out of high school. These apprenticeship programs, as well as technical education in high schools - you know, what we used to call shop or industrial arts - that's also growing in Wisconsin. We just need to make sure our kids and their parents realized there are more options than just a four-year degree and that there are great jobs in manufacturing.
GIGOT: This is a lot different than when you and I went to school. We're talking shop here. We are talking about really highly skilled machinist, mechanics, technicians, computer specialists. These are jobs that pay $60,000 to $70,000 or more as you climb up the ladder, beyond that.
JOHNSON: That's true. If you can become a master electrician, you will be knocking down more than $100,000 a year. The good news also is so much of what's happening in manufacturing today involves computers, robotics, and our young people are already naturally trained. I don't you about, but I don't load my own apps on my iPhone. I have my kids do that.
GIGOT: Oh, I can do that. I can do that, Senator!
GIGOT: I can at least load my apps.
JOHNSON: I do, too. I was embellishing. The more difficult stuff, trust me, my son does it for me.
GIGOT: OK, well that's good.
Let me talk to you about this bill you've introduced on guest workers. The unemployment rate in Wisconsin, 3.2 percent, I think, the last time I checked, very low. You have introduced a bill that would allow the states to apply for visas to run a guest worker program to fill of these labor shortages, about 5000 visas per state, and then a larger pool divided up among states depending on need. What is your thinking behind that program?
JOHNSON: When I first started running for the Senate in June 2010, in Wisconsin, I started going to dairies and talking to farmers, and that was the first issue they brought up with me, we need these migrant workers.
And so I thought it would be far better to have states run a program where they identify the areas of their economy that they need workers, and also what the rates would be, so they don't depress wages for workers, for example, in Wisconsin. But now that I've been serving here for six years, we have not solved our illegal immigration problem. We need a legal immigration -- and I would rather have the states, by and large, manage that. Now, visas are issued by the federal government, but they would be managed by the states, through contacts. Legislators would have to pass laws. But let's face it, if Alabama doesn't want guest workers, they don't have to do it. If Wisconsin does, through compacts with others state, it would be far more flexible and really target towards the areas of the economy that need workers.
GIGOT: What is your response to people that say, who oppose illegal immigration and say that even illegal immigration is going to reduce wages for American workers?
JOHNSON: I don't believe it's true. Right now, out of the best estimate, of the people in this country illegally, there are about 7.7 million in the workforce. And, Paul, just like every other wave of immigrants that ever came to America, the vast majority of these people are working their tails off doing jobs that, let's face it, American workers are not filling. So I just don't believe it's true.
GIGOT: Have you talked secretary of Commerce or the president about this, trying to get them on board?
JOHNSON: I have not talked to either of them about this, but we have the backing of the Cato Institute and Ken Buck has a similar piece of legislation in the House, and so we just began to roll this out. It's going to take some time. If I'm going to be lightning rod on this, that's fine, because I have the background to prove, and we have a state that proves we don't have enough workers. There is definitely a skills gap. By and large, we have a worker gap and it's a worker gap that is going to long term. The problem will only become worse as the years go by.
GIGOT: Senator Johnson, intriguing and, I think, a very good idea. Thank you for joining us.
JOHNSON: Have a great day.
GIGOT: When we come back, one of the darlings of the tech industry takes a beating, with Uber's CEO going on leave amid management troubles. What is says about tech startups and the stock slump, next.
GIGOT: The ride-hailing app, Uber, announced this week that CEO Travis Kalanick would take an indefinite leave of absence amid a growing management crisis. The company's chief business officer stepped down a day earlier following a vote by the board to adopt reforms to the workplace culture. Uber's woes come as U.S. tech stocks take a tumble with some of the biggest names in the industry seeing selloffs in recent days.
We are back with Dan Henninger, Mary Anastasia O'Grady, and Alyssa Finley.
Alyssa, you've been writing about Uber for us. How does a company with a $68 billion capital valuation after its last fundraising, how does get into this kind of management trouble?
FINLEY: You have to remember, it's a privately held company. It was started in 2009.
GIGOT: It's not going public.
FINLEY: It's not going public. But it means it does not have to follow a lot of investor disclosures and a lot of problems were managed privately, until you have these public accusations of sexual harassment and other things that continue to dibble out from media reports.
GIGOT: So you're saying -- is the implication of what you're saying that maybe the board -- they have a board, but it's more --
FINLEY: They -
FINLEY: -- oversight and hold the managers and executives accountable. So long as it was growing and making money, granted it's not making a profit --
FINLEY: As long as it was growing, they saw high growth potential, and they were willing to overlook some of these problems that didn't really seem to be directly in the business.
GIGOT: Mary, is this an old story, a familiar story of the driving entrepreneur who, you know, the visionary hard charger -- and you had to be a hard charger to break down all of the regulatory barriers, Uber, the taxi cartels in the big cities -- but maybe it's not the best choice, that person, for managing for the long run?
O'GRADY: I think that if they were smart, they would kind of recognize that they need somebody for management that is different than the innovators. Those are two different baskets. I mean, I acknowledge that if you get too much of the kind of establishment and staid management style, that could impact innovation. But I don't know. I think a lot of mistakes they've made are really basic things about how you treat people and civility and so forth. It shouldn't be that hard.
GIGOT: But if you are worth $60 billion, you must be doing something right.
O'GRADY: A lot of that is forecast for the future.
O'GRADY: And they are running into a lot of competition, and it's still not clear how they are going to make money. I mean, it's a wonderful innovation, this ridesharing platform that they came up with.
GIGOT: It has improved the lives of millions of people!
O'GRADY: It's fantastic. But it's not clear how they're going to do as other competition enters the market and they have to play ball with that.
HENNINGER: One distinction worth making here is that we always talk about things like Uber and Airbnb as startups, like they were the little mom-and- pop operations over in the corner. These are big businesses. The Internet economy is based on the fact that everyone participates. Apps like Google, Facebook, Twitter, they make money because they have millions and millions of customers. They are as big as General Motors or Ford of U.S. Steel in their time. So these are big companies, and big companies are very complicated to run. Ford was started by a maverick, Henry Ford. Andrew Carnegie was a maverick when he got into the steel business. But eventually, you grow up and you have to realize you are in something very complicated.
GIGOT: What you make of this point? Do you think that the public markets, Alyssa, would be better -- in other words, if you go public, you have to have more disclosure and so on. Is it better at disciplining companies sometimes than just companies that stay private?
FINLEY: No, I think they are. I think they have more investors, shareholders, when you have to publish problems and provide these disclosures, there is more sensitivity and the investors on the board will impose some checks.
GIGOT: What about the larger tech economy, Mary. We've been riding these companies that Dan talked about for months, they've been leading the stock market. We have had a correction of late. I guess my personal view is, I don't mind a correction. You know, we had that bubble in 2000. Corrections can be healthy.
O'GRADY: Yeah, I think the general market we missed in the tech sector has to be looked at in the context of the broader economy, which is that where in the eighth year of expansion, so it's normal that you would have a rotation into stocks that do well in the late cycle of an economic expansion. But you also have a lot of -- you know, you have Trump totally distracted from the agenda that he promised to deliver, and I think a lot of the rise in the market since he took office was looking forward to the idea that he would be cutting taxes and making it easy for companies to do business. So you have these great expectations, but you also have left easy money. And you also have a lot of oil weakness, which is sort of destabilizing I think a lot of the market.
GIGOT: Running up against some supply restrictions also on people. The labor shortage, we talked about, and capital investment. That is why the Republicans need to move on tax reform.
We have to take one more break. When we come back "Hits & Misses" of the week.
GIGOT: Time now for our "Hits & Misses" of the week.
Mary, start us off.
O'GRADY: Paul, a miss for 15 members of the New York City Council, which have sponsored a bill that asks the NYPD to turn over details, make public, details of the techniques they use for counterintelligence work. John Miller, who heads up counterterrorism for the NYPD, and who says that they've stopped 25 terrorist attacks in New York City since 2001, told the press that it would "create a one-stop shopping guide for understanding the tools and how to thwart them for criminals and for terrorists." And, you know, I like transparency as much as the next guy, but I think that the NYPD needs these tools.
GIGOT: All right.
FINLEY: This is a miss to California Democrats who have proposed a $2,000 pension bonus for California Highway Patrol officers who adopt dogs. You know, I love dogs, too, but I think this is mainly intended for the human owners.
All right, Bill?
MCGURN: Paul, no doubt this'll be the only hit Vladimir Putin ever receives on this show, but he gets a hit. On state TV, tongue in cheek, he offered James Comey asylum in Russia if he faced prosecution and compared him with Ed Snowden.
GIGOT: He compared Comey to Snowden? Ouch!
MCGURN: In reference to Comey's leaking. Mr. Putin asked, "What makes the FBI director different from Mr. Snowden? It seems to me in that case he's not so much the head of the FBI, as an activist who has a particular point of view." Ouch.
GIGOT: You don't think Comey's going, do you?
MCGURN: I don't want to rule anything out, Paul.
GIGOT: And 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 and to all of you for watching. I'm Paul Gigot. Hope to see you right here next week.
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