Kirk Lippold: Biden emboldening Putin by not answering Russian cyberattacks
Former USS Cole commander joins 'Your World' to preview the president's first overseas trip
This is a rush transcript from "Your World," June 9, 2021. This copy may not be in its final form and may be updated.
NEIL CAVUTO, FOX NEWS ANCHOR: All right, you have been watching President Biden addressing troops at the Royal Air Force Mildenhall in Suffolk, England.
He is going to be very busy for the next couple of weeks beginning his first foreign tour as president of the United States, the president making very, very clear here that he respects and honors the military and the sacrifices entire military families make, so that we are protected, and that he will represent them well.
The president will be making a great deal of stops and a great deal of important meetings, including with the queen of England. Of course, this will be her 14th meeting with a U.S. president dating back to Harry Truman, but, of course, very eagerly awaiting that meeting, the president course will gathering with the other major Western power heads of state.
They are more his cup of tea on some issues like climate change and some of these other issues. But we will see how all of that goes, because there has been concern among some that some of these efforts are going to disproportionately be borne by the United States.
We will explore that in greater detail as the show ensues and as this trip goes. Of course, the biggest moment, of course, will be the meeting with Vladimir Putin. And therein lies the debate as to whether that meeting should take place. The president and his people thought it best, even with these cyberattacks on the U.S., most notably likely from Russia, and maybe countenanced by Vladimir Putin himself.
Let's get the read from Peter Doocy in Cornwall, England, with more on what we can expect from a no doubt very eventful couple of weeks -- Peter.
PETER DOOCY, FOX NEWS WHITE HOUSE CORRESPONDENT: Yes.
And -- yes. And, Neil, the president on his way over here, on his way to cross the Atlantic for the first time as president, he outlined that the reason the G7 is meeting for the first time in person since the pandemic started is because they're trying to put on a strong show of force, basically, for China and Russia, and let them know that, if there's any bad behavior, there is this strong alliance, the Group of Seven, that is standing by.
The president was asked whether or not he is going to come to some sort of an understanding with Vladimir Putin about those ransomware attacks that are launched from within Russia, if not directed by the Kremlin. He said that that is something that is on his list of things to talk to Putin about.
But, right there, you heard, he said he is going to go and tell Putin what he wants him to know. So we will see what happens with that next week.
First, though, here at the G7, we expect a lot of the focus to be climate. We heard earlier that Boris Johnson, the British prime minister, is borrowing from Biden's campaign slogan. He says they want to build back better, build back greener. And the president there said that, when he went to the Tank at the Pentagon for a classified briefing about the greatest threat to national security, he was told by top generals it is global warming.
His first trip for the 46th president is a markedly -- it represents a markedly different approach to foreign policy than the 45th president, with such an emphasis on global warming. And so we do expect that to lead the next couple of days here in Cornwall -- Neil.
CAVUTO: All right, Peter, you're going to be a busy man. Thank you very much for that, Peter Doocy, in Cornwall, England.
To Susan Crabtree now, RealClearPolitics.
Susan, there was a great deal of back-and-forth since these ransomware attacks and hacking incidents involving everyone from a giant U.S. meat distributor to a pipeline company, Colonial Pipeline, more to the point, that, given the frequency and the severity of these attacks, and knowing that they came from Russia, and likely not without some countenance or at least knowledge of Vladimir Putin, that Vladimir Putin shouldn't be rewarded with a one-on-one meeting.
But it will come to pass. And the president's backers, the president himself says: I want to see him eye to eye. I want to talk to him about all of this stuff.
How do you think it goes?
SUSAN CRABTREE, REALCLEARPOLITICS: Well, I think you had the ambassador to Russia meeting with senators a few weeks ago before this meeting with Putin -- between Putin and Biden was announced.
And he was warning those senators that Putin hadn't changed, and that this would be really a gift to Putin to have this meeting, great optics for Putin, but what is going to be the consequences for the Russian leader? We saw very little consequences so far. He's not reacting to the sanctions.
So the ambassador said that nothing has changed. But like Lindsey Graham said just earlier on FOX, he was saying, well, you should meet with leaders. You should be sit down with them. But he needs to make it very clear that there will be consequences.
And he said that. You could see him addressing this head on in those comments just right now to U.S. soldiers and airmen at the base in Britain, that he said, we will respond in a robust and meaningful way, and he wants to tell Putin what I want him to know.
So he's clearly trying to project strength ahead of this very controversial meeting. And it is also something that he wants to show. He's very orchestrated in the way that he's handling these meetings in Europe. He wants to show that he is tight, in his own words, what he said before he left for the trip with the European nations and the G7, and that those bonds are extremely strong.
It's sort of a portrait in contrast from what we have seen from the Trump administration when he was going in for his first overseas trip, when he was criticizing NATO for not contributing enough money, NATO countries, and letting the U.S. basically under -- provide the funds for it, most of the funds for NATO.
CAVUTO: You know, if you think about it, now, say what you will about Trump's style, the president's style, during that time. He did address a number of valid points, that we were seriously paying a disproportionate amount for NATO funding. And he did -- was able to shake some change out of them.
But it reminded me it's something, Susan, that I wonder what your thoughts on it, that European leaders generally prefer, at least, or seem to have warmer feelings toward Democratic presidents than Republican ones. Now, I know, in the case of Ronald Reagan, he eventually was starting to win them over, but -- his more conservative views.
You could say the same with Donald Trump. That's not the kind of stuff that wins them over. Presidents who are in lockstep with their point of view, like on climate change and some of these other commitments, as Joe Biden is, that's kind of more of their cup of tea.
So I'm just wondering how this posture changes now that a Democrat is in the office espousing these things that are near and dear to those European leaders. What do you think?
CRABTREE: Well, I think that you had sort of a -- with George W. Bush and September 11, of course, he enjoyed a little bit of a reprieve from what you're talking about, but certainly with Donald Trump.
CAVUTO: Yes.
CRABTREE: I remember the E.U. president saying, when he said he believed in Brexit, that he supported Brexit: Well, I think I'm going to go over to talk to Ohio to tell him -- to Ohio to leave the United States.
So there was a lot of acrimony between the European leaders and Donald Trump, of course, especially with hanging in the balance was the Paris climate accords, which he eventually pulled out of.
But during his first overseas trip, the first countries that Donald Trump went to were Saudi Arabia and Israel, our big allies, but not in Europe. Then he headed over to the G7 to meet with the European leaders. So you see it's a definite portrait in contrast right now.
Certainly, Joe Biden was not confronting the Russian -- Germany-Russian pipeline, even though he shut down our own Keystone pipeline. Angela Merkel is probably very happy about that. There's big ties between Europe, and especially Germany and Russia, that they don't want disturbed.
But, at the same time, Biden is -- does want to confront Russia and also China, Russia on ransomware and China on the origins of the virus. Those are the two big elephants in the room. There's incredibly important optics that are going on.
But the substance of the talks will also be important, with addressing those two big menaces from our -- from China and Russia.
CAVUTO: You know, President Trump constantly made reference to Germany and its deals with Russia, like, why are you doing these business deals, and why are you making yourself vulnerable, to them? I'm just sort of cutting to the chase, Susan.
And I'm wondering if Joe Biden does the same privately or, given the weirdness of shutting down refineries or at least limiting the enthusiasm that we had in the prior years with fossil fuels and all the rest, that's something he is at least publicly not interfering on when it comes to Germany and this particular pipeline.
I'm just wondering if quietly he brings it up and anything changes.
CRABTREE: Well, certainly, when it comes to ransomware and the investments that Russia is making in these countries, that is something that he -- that Biden is going to probably talk very, very quietly about, because they are such sensitive topics.
There's a lot of Russia investment in the U.K. too, in U.K. real estate in London. You don't hear a lot of concern about that. And I remember, during -- covering this during the President Obama's administration at the very end, there was a lot more sanctions after this -- these allegations of intrusion in our elections.
And there was all these sanctions going on. But that wasn't happening early on. In fact, as you remember, the Intelligence Committee chairmen were very -- in the House and Senate were pushing the Obama administration to take a more robust approach to Russia when it came to cyberwarfare.
So, yes, we're seeing I think that it's going to be a touchy situation when he talks about the financial ties between Europe and Russia. When it comes to these cyberattacks, it's time to get tough, and Biden knows it.
CAVUTO: Yes.
And, in fact, your memories about President Obama and how he handled that, a lot of those diplomats were getting kicked out, that was happening really in the final weeks of his administration. But that's a separate matter. It's a new guy running the country right now.
But, Susan Crabtree, thank you very, very much.
Of course, the most telegraphed meeting will be that one with Vladimir Putin. And that's one of the Kirk Lippold is looking over very, very closely, the former USS COLE commander with me now,
Commander, very good to see you.
You have heard the back-and-forth about what will come of that meeting, and that the president has argued it's important that he see and tell Vladimir Putin to his face about the ransomware attacks, about these provocative acts, that it stops.
But does it come with still more sanctions, as Russia is probably among the more sanctioned countries, at least vis-a-vis the U.S., on Earth? What do you what do you make of what happens, what should happen?
KIRK LIPPOLD, FORMER COMMANDER, USS COLE: Well, Neil, there's talk and there's action.
And when you look at the president, obviously, he is going to engage with Vladimir Putin. These are very important topics for him to address. But you have to also look what's going on back here at home. When his secretary of commerce makes the statement to American businesses these attacks are here to stay, and, if anything, are going to intensify, with no plan to do anything, you have to remember American businesses are prohibited by law from responding to these attacks.
That's a U.S. government responsibility. And Secretary Raimondo has essentially abdicated any leadership role and told businesses, the U.S. government is going to do nothing to protect you, and it's your responsibility to protect yourselves.
So, on one hand, while the president may say, hey, Vladimir, you can't do these things, when you have an acceptance by a Cabinet official that is accepting of what is happening, and then saying, businesses, it's your responsibility to protect yourself, those are two different approaches.
And I, quite frankly, think that is the -- it is asking for a 9/11-style attack. Would we be the same kind of accepting if we had told bin Laden, hey, don't worry about World Trade Center one, don't worry about the embassy bombings, don't worry about the attack on USS Cole?
It emboldened them. If we do not respond clearly and forcefully to the Russians -- and by that, I mean the government of Russia. These are state- sponsored attacks because they're happening in Vladimir Putin's country. He doesn't allow things to happen unless he knows about it.
CAVUTO: Yes.
LIPPOLD: So, I think we are setting ourselves up for a failure with that type of attitude.
CAVUTO: And while too hard to tell right now, but we do know that Russia has responded in whatever way it can by taking away dollars out of the sovereign fund.
It's chump change in the scheme of things, tens of billions of dollars when all is said and done. But he's sending the message that, if it hurts your dollar, so be it. If we don't put you in a basket of currencies and investments around the world, so be it.
Of course, his investments in the U.S. and impact on the U.S. are fractional compared to even some of the smaller European countries. But having said that, he's got a number of things up his sleeve. And he can agitate things. As an OPEC Plus member, he can influence oil production at the very same time President Biden is trying to ease up on traditional oil, fossil fuel development.
And that can compound the problem, right? That can begin to get to be a military concern, besides just an economic one, right?
LIPPOLD: Absolutely, Neil.
Each of these are national security concerns. Every cyberattack, every ransomware attack gains experience for these criminals that operate under the protection of the Russian government. And every time they do that, they're gaining that expertise.
And when you look at it, look, we are making the decision as a nation that we're going to go green. That's all wonderful. But, by the same token, we can't cut off our nose to spite our face. We are still going to be using fossil fuels, because, quite frankly, the minerals to go with electrical vehicles and electrification of the nation simply do not exist.
And shifting those out to resourcing them out to Brazil, Australia and Canada, when we, in fact, can get those minerals ourselves in the Eastern Pacific off the seabed, we need to take advantage and do that.
But, by the same token, we need to ensure that we finished things like the Keystone Pipeline, so we have that ready reserve available in the event of a national emergency. So, we do have a cross-section of national security interests at play here. And with Russia building the Nord Stream II pipeline right into the heart of Europe, and getting them addicted to that stream of fossil fuels, that provides us with a danger.
CAVUTO: You know, Commander, finally, you had to deal with really the first modern-day terrorist incident in the bombing of the USS Cole back in, I believe, August of 2000.
It was a precursor to what would be ultimately 9/11. And I know you had warned after that attack that it could happen again, and that the party of the president really didn't matter. I believe at that time it was Bill Clinton, but that this total indifference you were telling me shortly thereafter on the part of Washington to the ongoing threat, we forget it.
But you're very concerned about it now. And I'm wondering that, in conjunction with the saber-rattling China's doing with Taiwan, even fears - - if you read the Taiwan press, Commander, I mean, that's a page one story every day. They fear being invaded.
LIPPOLD: Absolutely.
CAVUTO: Where do you think that stands? I mean, that is a -- you talk about a provocation and how you would even attempt it. What do you make of it?
LIPPOLD: Well, if you look at the parallels between how we were approaching Al Qaeda and these -- what they called then non-state criminal terrorist groups, Al Qaeda, Al-Shabaab and others, and you look at the parallels with these criminal groups that are conducting these cyberattacks and ransomware attacks, both of them were gaining experience and testing the United States' resolve and the ability to react to it.
And what you're going to have is that, if we do not have a response to hold governments accountable, the governments of Russia, the governments of China, the governments of Iran and North Korea, that we run the risk of allowing these -- quote -- "non-state actors" to be able to conduct these attacks with impunity, we are, in fact, emboldening the governments to test us on a larger scale, and that Russia and China could, in fact, coordinate, where Russia interferes with our ability to respond in the cyber world.
At the same time, China moves against Taiwan, they push out into the Pacific when it comes to the dash-nine lines and the islands that they have militarized, in violation of international law, where we truly have not really responded in any way whatsoever. And, unfortunately, our allies don't have the capability.
So we're going to have to take a larger, more holistic approach to the threat that Russia and China together are presenting to the United States. And we need to be able to start going back and saying, Russia, we are going to hold you, the government, accountable for what is going on in your country with these criminals, because they're essentially like some of these Middle Eastern countries that aided and abetted the growth of Al Qaeda.
Russia's aiding and abetting the growth of these cyber criminals that will eventually be subsumed within the military and the Russian government in conducting cyberattacks against the United States.
CAVUTO: Well, as you said, Commander, the bad guys never take time off. We forget that, right?
LIPPOLD: No.
CAVUTO: They're always, always plotting, always working.
(CROSSTALK)
LIPPOLD: And they get a vote if they go to war, absolutely.
CAVUTO: Yes, you're right about that.
Commander, thank you very, very much, Kirk Lippold, the former USS Cole commander.
President Biden now wrapping up his visit to the Royal Air Force Mildenhall base in Suffolk, England.
I want to go right now to developments here at home that the president no doubt will be watching very closely from afar, because that whole bipartisan push for an infrastructure deal seemed to fall apart yesterday, when West Virginia Senator Shelley Moore Capito had said, essentially, the president has ended the talks, quit them, we're far apart, and that's that.
Well, apparently, it is not that's that, not if my next guest is going to have anything to do with it, Republican Representative Brian Fitzpatrick, the Problem Solvers Caucus co-chair, the state of Pennsylvania, Democrats and Republicans alike trying to find middle ground here to get stuff done. There's a concept.
Congressman, I know you have your own proposal you're working on here to try to get these talks started again. But it's a little pricier than the original Republican one. But it might be more to the president's liking.
Can you update me?
REP. BRIAN FITZPATRICK (R-PA): Yes, Neil, thanks for having me.
It ironically falls squarely between the Republican and Democrat proposals. And that's what our caucus is about, about solving problems, finding that solution in the consensus area of the center.
What we do want to do, though, is make sure it's paid for, and that's going to be in the next phase. But what we did, Neil, essentially, we broke this out into three phases. Phase one was definition. We made sure that we were dealing with physical and traditional only types of infrastructure.
The second phase, which we just released last night, which also got the endorsement of our caucus, which requires three-fourths of the 58-member 29-Democrat, 29-Republican caucus to endorse, which we did, which is 1.2, but it's over eight years, not five.
So it's always important to compare apples to apples when you're dealing with these numbers, because some are talking in terms of five years, some eight, some 10.
And then the next round is going to be the pay-fors. But we wanted the president, the administration to know. We have brought them into the fold on these conversations. We have been working with a bipartisan group of senators to try to keep this off the rails of reconciliation, which is incredibly divisive and bad for America.
CAVUTO: How likely does it look?
I know you come in more in line with the president's numbers. There's hints that the president isn't glued to the $1.7 trillion figure, that, with some of the savings, he's open to tapping other funds, like COVID funds, but not nearly to the degree you are.
How realistic is it that a deal can be scored right now?
FITZPATRICK: Well, the House has spoken.
Our Problem Solvers Caucus has spoken. We are a centrist bloc of 58 members. And we endorsed this plan.
CAVUTO: Right.
FITZPATRICK: So, the next thing to watch, Neil, would be the Senate, Kyrsten Sinema and Bill Cassidy and some of our colleagues in the Senate that are working together to try something very similar to what we proposed.
If it's close enough, we will marry the two, and then you have a bipartisan, bicameral option for the administration to consider. And I think they'd be hard-pressed to turn that down.
CAVUTO: Now, the important distinction there, Congressman -- I'm sorry to jump on you, but to make the point that, if you were to get those votes, Joe Manchin, who might not like what he's seeing, might not matter in that environment, that you could still cobble together something without him, right?
FITZPATRICK: Yes, sir.
I mean, the key now and the standard is the 60-vote threshold, right?
CAVUTO: Right.
FITZPATRICK: So you got to pick up 10 Republicans without losing any Democrats. And that's always a challenge.
But we think we're getting really close to that sweet spot.
CAVUTO: All right, please keep us posted, Congressman.
It's always nice to know that you don't give up on something. You find middle ground,. You give, take. You work back and forth. But the end result shouldn't be necessarily nothing. It's -- sometimes, we live in a world, it's all or nothing, all my way, my way, not your way. And on we go.
So, he's looking for middle ground there.
In the meantime, I want to bring your attention to another development on Capitol Hill today. It was an opportunity for the labor secretary of the United States to explain the administration's position on these job figures that have consistently been disappointing now for the last couple of months.
Marty Walsh was asked repeatedly about whether jobless benefits that had been extended into the fall are actually leaving many Americans to hold off on finding work. Then we come to discover that 9.3 million jobs are still out there, and they're going begging.
Anyway, we have been following this very, very closely with Hillary Vaughn right now on Capitol Hill, that back-and-forth.
He had a lot of doubters, right, Hillary, about as to whether those jobless benefits had any impact on this. He says no, but, obviously, many of his questioners said it was a factor. How did it end up?
HILLARY VAUGHN, FOX NEWS CORRESPONDENT: That's right, Neil.
Well, question after question, Labor Secretary Marty Walsh said, no, he does not believe that these boosted unemployment benefits are to blame for what businesses say is a worker shortage right now in America.
Walsh says he does not plan on ending these enhanced benefits early and instead will let them expire as planned in September. And he said, if there is a reason why people aren't back on the job, it's because they don't have childcare or people aren't fully vaccinated yet.
(BEGIN VIDEO CLIP)
MARTY WALSH, U.S. SECRETARY OF LABOR: I don't believe that $300 is keeping the entire eight million people out of the work force.
REP. GLENN GROTHMAN (R-WI): Well, I'm not saying the entire eight million. It might be four million.
But will you acknowledge that, if you're paying people $30,000 to $35,000 a year not to work, a given segment of people will say, fine, I'm not going to go to work?
WALSH: Yes, I don't believe that we're paying people not to work. I think we're paying people -- we're trying to support people's livelihood during a pandemic.
(END VIDEO CLIP)
VAUGHN: And Walsh was also asked about inflation and prices popping for consumers.
Here's what he had to say to that.
(BEGIN VIDEO CLIP)
REP. JIM BANKS (R-IN): Is it a good sign for our economy that the American people are spending more -- more dollars substantially every time they pump gas or go to the grocery store? Is that good for our economy?
WALSH: Actually, the president's plan is working right now.
(END VIDEO CLIP)
VAUGHN: And, Neil, while the middle class may be paying more for things like gas and groceries, Walsh continued to say that what he meant by the president's plan working, he means that people making under $400,000 are not paying more in taxes -- Neil.
CAVUTO: All right, Hillary Vaughn, thank you very, very much.
And Hillary did touch on it here, this inflation that's been beginning to bubble up right now. We see it in the weirdest kind of developments, including Chipotle announcing that it's going to be raising menu prices 4 percent to help pay for the pay hikes it's been giving about 20,000 workers who it plans to hire through the course of the summer to keep up with demand, as it opens up a whole lot of stores.
So, the argument you're hearing from the Chipotle CEO, said he's very, very competent loyal customers will happily pay that to keep a work force happy and grateful.
Steve Moore is with us. Kathryn Rooney Vera is with us.
Steve, what do you think of that, that maybe this is way of private industry to say, all right, we are paying our workers more, this is something we're not doing at a government ask or government edict, and we are asking our customers to help foot some of this bill by paying 4 percent more for some of their favorite food?
What do you think?
STEPHEN MOORE, FORMER DONALD TRUMP CAMPAIGN ADVISER: Well, the people really get screwed by that are, number one, the smaller restaurants.
Chipotle is a huge national chain, so that they can afford to raise their prices and increase their pay to their workers. But these small businesses around the country, not with thousands of employees, but the ones that have 20, 30, 40, 50 employees -- and, by the way, those small businesses hire about 60 percent of all workers -- those are the ones that don't have the luxury of just saying we're going to raise our prices and raise our wages, because they have such small profit margins to begin with.
And the other thing to think about is, if all these businesses start raising their prices, who does that hurt, Neil? Obviously, it hurts the little guy, the guy living on a $25,000 or $30,000 or $35,000 salary that now when they go out or have to get gasoline or they want to go to Chipotle, they have to pay more.
It shrinks their paycheck. And I would make the case that that, Joe Biden, is a tax increase on low-income people, that inflation.
CAVUTO: All right, but, again, it's 4 percent. Chipotle, of course, just reported revenue of more than $1.7 billion and a year-over-year increase there of 23 percent, even with some of those wage increases.
MOORE: Well, Neil, that's my point. Neil, that's my point, right?
(CROSSTALK)
CAVUTO: Well, no, I understand what you're saying. Good for the big guys. I get your point.
MOORE: Right.
CAVUTO: But, Kathryn, I would like to get your sense of whether this builds steam.
Maybe some people can add 4 percent, depending, again, to Steve's point, on where they are income-wise. But when it goes another 4 percent after that, or some of these food and related shortages that have prompted double-digit hikes right now in a lot of basic commodities for folks, at what point, as you look at the economy and the markets, does it become a worry?
Are we at the, OK, I'm worried now, this is getting extreme? What are you thinking?
KATHRYN ROONEY VERA, BULLTICK CAPITAL MARKETS HOLDINGS: Right. Right, Neil.
Yes, when times are good, people will pay the 25 to 40 cents more for an $8 burrito. That's when times are good. The U.S. economy, Neil, right now, as you know, is growing 6.5 percent year over year. That's because last year was so horrific. So, base effects are going to slowly trail off, which leads us to 2022; 2022, we're likely going to see a rollover in economic growth, because the base, which is 2021 is so high.
So, we're at 6.5 percent growth this year. Next year, we're going to see a slowdown in economic activity, higher taxes and higher inflation. So, while times are good, and there's 9.3 million jobs out there, perhaps people don't take them because the government has now put the market-clearing price of going to get a job at $32,000.
So if you're making less than that, it doesn't make sense to go get a job. But when times get rougher and you have both higher prices, fewer job opportunities, and slower economic growth, people are going to start complaining about that quarter price increase on their burrito, or maybe double that.
So I think inflation is inevitable. We have massive fiscal stimulus, massive monetary stimulus, and ongoing emergency measures, Neil, when we're out of the emergency. So is this a big government power grab? I think that's something to be discussed and debated.
But we must return to our roots to let the private sector work itself out and find its own market-clearing price for employment.
CAVUTO: Yes.
Steve, and I understand that you worked for Donald Trump. And I'm not trying to disparage either the prior president or this one. But it does seem a stretch to me to look at these upticked prices in meat and pork and welcome some of these other areas and blame the new guy.
I mean, that is a reflection, if anything -- and you're a great economist - - of an improving economy and prices rising, demand building. I don't know if it can be just dropped on the lap of Joe Biden.
Your thoughts?
MOORE: Well, there's no question the economy is getting better.
Look, I'm really bullish on the economy for the next six or nine months. We're opening up our businesses. We're getting people back to work. I think the two problems that we see on the horizon are, number one, what we were just talking about, these -- the threat of inflation, which, once that genie gets out of the bottle, it gets harder and harder to push back in the bottle, as we learned in the 1970s.
But the other one is, look, this labor shortage is a gigantic problem, I mean, the shortage of people going into these jobs.
And I listened to what the labor secretaries were saying. Oh, it's $30,000? No, our report that came out today shows a couple with two kids, you have both parents unemployed, they're talking about $75,000, $80,000, $100,000 a year in all these government benefits.
There's no way that the -- that these private small businesses can compete with...
(CROSSTALK)
CAVUTO: I just find it -- Joe Biden, when -- he's getting ready to leave right now after this event with our troops.
I just find, if you're talking about the strong economy and the buildup in demand, that's happening under his watch, just like the backdrop for this was happening under Donald Trump's last couple of months' watch.
So, I always find it a bit of a stretch. All right, how is he all of a sudden Jimmy Carter? It just doesn't make sense.
ROONEY VERA: I can weigh in there, Neil.
CAVUTO: Sure.
ROONEY VERA: I think $6 trillion are already approved by the Congress, only of which 3.4 have been executed.
So, instead of using the unused funds for COVID -- and this is a government that's talking about taxing job-creating corporations and increasing exponentially debt-financed spending. So, there's a problem when you have $6 trillion...
(CROSSTALK)
CAVUTO: No, I have no doubt -- no, no, I get what you're saying.
Absolutely, Kathryn, I get what you're saying, what Steve is saying, that, down the road, this type of thing, where you're spending on top of spending, and obviously digging deeper into debt...
ROONEY VERA: Yes.
CAVUTO: ... although it's a little bit weird to hear Republicans lecturing anyone on building up the debt.
ROONEY VERA: Yes.
CAVUTO: But, having said all of that, and the unique circumstances with COVID that challenged the last president's final year in office, I am beginning to wonder, a $6 trillion budget, for example, that the president proposes is something that can be changed and probably will be.
I'm just wondering now to prejudge that we might be heading toward hyperinflation might be a bit premature. That's what I'm saying.
Are we heading to that? Is that your fear?
MOORE: I don't believe...
(CROSSTALK)
ROONEY VERA: Well, we have 30 percent of GDP in spending. So, we have to at some point grow the economy at either the same rate or more at which we're growing debt.
CAVUTO: Right.
ROONEY VERA: And it's exponentially more. So it is unsustainable.
And my suspicion is that that $6 trillion is never going to be retraced. That's just going to become massive social spending. So, at some point, interest rates have to go up. We're going to have to pay higher costs to finance our debt than ever before.
And everything else that we spend on in its magnanimity is going to have to be in additionally debt-financed. So it's just a very vicious cycle that we have no intention of reining in, Neil. And I think that's the problem.
CAVUTO: All right.
ROONEY VERA: Once we do get inflation, interest rates go up, we really hit against the wall.
CAVUTO: All right, guys, I wasn't want to be jumping on you there, but we did want to wrap this up, as the president waves goodbye here in the first leg of this trip.
It's going to be a very, very busy trip. We talk about the U.S. economy. Say what you will of it and the strength and the controversy and whether inflation is coming with it as well, the fact of the matter is, the U.S. is the envy of the world, not only in the COVID response and the vaccinations that have brought us very, very tantalizingly close to the 70 percent vaccination rate goal of the president's by July 4.
But we have also seen that, by comparison, European countries and many of those leaders the president will visit, they're in a world of hurt, and not enjoying nearly that president's success or this country's success.
So, wherever you are on the political label, the man representing us abroad right now has a good story to tell. And you're the reason we're the envy of the world.
Stay with us.
(COMMERCIAL BREAK)
CAVUTO: All right, the vice president back from her trip, as the president sets off for his big trip, but a whole lot of controversy, and she's getting it from both sides, on why she didn't visit the border itself.
Griff Jenkins in Del Rio, Texas, with more on that -- Griff.
GRIFF JENKINS, FOX NEWS CORRESPONDENT: Hey, Neil.
What the vice president would see if she came here is that the smuggling operations don't stop. This is the Rio Grande River. It is the U.S.-Mexico border between Del Rio, Texas, and Mexico on the other side.
You can see some activity over there. Just about 30 minutes ago, we had about a half-a-dozen Venezuelans cross. Now, look at this tight shot we have just got for you. The gentleman in the white shirt crouching there, that is the smuggler that's moving them.
I tried to talk to him here in the water about 30 minutes ago, but he didn't want to talk to me. I just asked him if more people were coming. He said yes. So we expect more crossings to happen any moment now from the Mexico side to come across here to this private property that we have been at all day long.
Now, we went for an exclusive boat ride along with the Border Patrol chief for this sector, Austin Skero, Neil, yesterday, and it was quite eye- opening, crossings happening all day long in broad daylight.
And he talked to me as we witnessed a crossing about the dangers the migrants face. Take a listen to this.
(BEGIN VIDEO CLIP)
AUSTIN SKERO, BORDER PATROL DEL RIO SECTOR CHIEF: And God forbid one of these babies gets dropped in the water and they can't get to them.
So far this year, we have rescued almost 1,300 people. Sadly, we have had about 49 die to either exposure or groundings. It happens. This river is a dangerous place.
(END VIDEO CLIP)
JENKINS: And, Neil, I mentioned that property owner. Her name is Marsha Morgan. She lives in this house right here on the bank. She's frustrated with what she's been seeing.
And I asked her if she wants the vice president to visit. Here's what she said.
(BEGIN VIDEO CLIP)
MARSHA MORGAN, RESIDENT OF TEXAS: I wish they would, but I know they have no intention of doing so. And, honestly, I don't feel like, them coming here, that they would make any changes.
But they need to foresee what the impact of their choices are going to cause five, 10 years down the road.
(END VIDEO CLIP)
JENKINS: And, Neil, I don't know if you can see this.
Actually, right now, the smuggler is coming over towards us. I'm just going to take a moment and ask him a few questions.
(SPEAKING SPANISH)
No?
(SPEAKING SPANISH)
JENKINS: OK. Well, Neil, he's not saying anything about how much he's getting paid or if he has a message for President Biden. But he does say that more people are coming. Not entirely sure why this smuggler is sitting in the middle of the river here.
But we're going to continue to monitor it and bring it to you as we get it -- Neil.
CAVUTO: Incredible. He's not exactly hiding.
All right, thank you very, very much, Griff Jenkins.
You ever wonder where a lot of these folks go as their cases might be adjudicated in the U.S.? Well, in Arizona, they want to put them up at a Scottsdale hotel.
I want you to meet the attorney general who said, stop. For God's sakes, stop.
(COMMERCIAL BREAK)
CAVUTO: All right, you probably saw that video a little while ago with Griff Jenkins in Del Rio, Texas and a smuggler in the light of day, not, obviously, concerned about Griff's camera or the fact that there are a lot of people nearby watching him, go right across the border, with very, very little difficulty here.
It's incidents like these that disturb my next guest, but more so developments right now in Arizona, where a Scottsdale hotel is being retrofitted to become a migrant facility. This is in Scottsdale, Arizona.
The attorney general of Arizona, Mark Brnovich, joins us right now.
General, very good to have you.
Explain what this is about, this Scottsdale hotel, and how you got word that it's going to be retrofitted for this.
MARK BRNOVICH (R), ARIZONA ATTORNEY GENERAL: Well, Neil, we have three ongoing lawsuits already against the Biden administration for incentivizing and decriminalizing our border and incentivizing people to cross legally.
We found out about this through -- when it started happening, when ICE literally started retrofitting this hotel, as you said, a very kind of nice area, Scottsdale in -- in Arizona, a block away from a school, right next to a senior center, right next to other residential housing.
And they are retrofitting it to house 1,200 to 2,000 people and making it into a detention center. And we have all sorts of concerns, because we already know that ICE is not deporting people with criminal records. People that are being released from prisons are being released.
So what happens? What types of people are going to be housed there? Are we going to have people, when they escape, or if they leave, are they not going to be arrested or deported because of the sensitive area policy of ICE? There's all sorts of questions.
But this has been consistent with the Biden administration telling folks or states -- states like Arizona to pound sand.
CAVUTO: So, this is a hotel, after all.
BRNOVICH: Yes.
CAVUTO: So, have they cleared it out. Will they clear it out for these migrants? And they notified local authorities of that?
BRNOVICH: Yes, what they have done is, they have -- they have contracted for this hotel, because, right now, there's issues regarding that hotel and bankruptcy.
And so they have used that as an opportunity to not only kind of give Arizona the middle finger, but now you have this situation where we don't know. We don't know what's going on, as far as who's going to be housed there. How long are they going to be housed there? Are they just going to be released into our communities after 72 hours?
What kind of drain or impact is this going to have on local resources? So that's part of the problem, is that there are so many unanswered questions. And when you put that, Neil, on top of the other layers of -- you just showed the guys having people cross the border illegally, the smugglers.
CAVUTO: Right.
BRNOVICH: Cartels are enriching themselves, seeing a huge spike in fentanyl and heroin coming across the border.
So, we're living with the consequences of this. Arizona is my home. This is where I grew up. And this may be some sort of experiment or some sort of signal to the far left, but, my goodness, Neil, this is going to have consequences not only here in Arizona, but throughout the country.
CAVUTO: So, these people who find their way to this particular hotel -- and there are others like this, are happening in other states...
BRNOVICH: Yes.
CAVUTO: ... I know in the case of Tennessee and all that.
Do you know how long -- you touched on it, but I thought -- and I had heard the 72-hour figure as well that they're there before they're processed and somewhere else.
Hold on a minute. We're going to go to Griff Jenkins talking to this -- this was -- this was earlier. I apologize. This was earlier, Attorney General, talking briefly to this smuggler .
I want to see if we can make it out, guys. Let's listen, if we can.
(BEGIN VIDEO CLIP)
(SPEAKING SPANISH)
GRIFF JENKINS, FOX NEWS CORRESPONDENT: Not coming for you?
(SPEAKING SPANISH)
(END VIDEO CLIP)
CAVUTO: All right, I'm trying to even make out, with my own rudimentary knowledge of Spanish, what he is saying.
This is a smuggler who has gotten his way into the United States, that he has not run into any trouble with police in Mexico, that the real disruption was here once in the U.S. and at the border.
But it tells you everything you need to know about the disruption that is now getting kind of out of control, to put it mildly.
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