The Ricochet Podcast - Deal With It

Episode Date: June 2, 2023

Larry Kudlow is back! And he brings good news, among other things. The guys get his take on the dealings of this Kevin McCarthy fellow, along with predictions on forthcoming (eventually!) market corrections, and his optimistic assesment of American work, tradtions and faith.Plus our merry trio get into the GOP primary contenders—and some other people whom we're told are running. More importantly, they talk toy trains... Just tune in and roll with it.

All I saw were whales. We got plenty of whales. Don't worry about the whales. Ask not what your country can do for you. Ask what you can do for your country. Mr. Gorbachev, tear down this wall. Read my lips. No new taxes. It's the Ricochet Podcast with Peter Robinson and Rob Long. I'm James Lonix, and today our guest is the one, the only, Larry Kudlow. So let's have ourselves a podcast. They spied on my campaign. They did all sorts of things.

I was under investigation and under siege, and so were my people. And if I wasn't tough, I wouldn't be here right now, I guarantee you that. If I didn't fight back, I wouldn't be here. America is a nation that can be defined in a single word. I was going to put him in a... Excuse me. Welcome, everybody. It's the Ricochet Podcast, number 972. Just kidding. I thought maybe you would, you know, wake up and say,

wait a minute, I missed 300 of them? No, we'll get there eventually. And we'll get there through the grace and wit and wisdom and intelligence of the founders who founded Ricochet in the first place, Peter Robinson and Rob Long. I'm James Lylex in Sunsplash, Minnesota. Rob Long is on his deck up in Gotham, where it looks to be beautiful, and Peter is in California, where, of course, it's green and lush and wonderful. June, the first week of, is there anything so rare? It's a beautiful time. But of course, it's green and lush and wonderful. June, the first week of, is there anything so rare? It's a beautiful time.

But of course, what we're all paying attention to is the blood on the floor in the political matters where DeSantis and Trump seem to have finally decided that it's on. So welcome, gentlemen. And how have you viewed the last week where the slumbering DeSis campaign seems to have woken up and started to address particular things that are being aimed at them politics at last high time that's my view of it high time and it ain't beanball and it ain't beanball no it ain't beanball um i guess what am i what am i rick de santis unchained rob is him rob meatball rob rob meatball de santis ron de sant excuse me i'm so i was about to do some little riff on the way he seems to be pronouncing his name and then i screwed up anyway okay so ron de santis or de santis or who knows anyway the guy is tough and smart. I still stand by the comment

that I think Rob and I agreed on this. In some way, he's not quite himself in front of a camera. There's some kind of stiffness there. But when you see him making eye contact as he did in Aya with actual human beings in the crowd, he's pretty good. He's pretty good. good also i have to say i'm torn about this because i don't want a field of 35 candidates vying for the republican nomination some of them it seems to me are vying for the vice presidency and some of them are simply vying for book contracts and their own talk shows or their own radio shows on the other hand i'm very happy to see chris christie get into the race chris christie has his drawbacks for sure but again he's tough and he's smart and he's willing to go right at donald trump um all this strikes me as good news i i have enjoyed the

last week of politics and pence's entry, you might get the impression of... Is he informally yet? No, but it's happening. It's happening. I want to know what sort of Svengali can work his mesmerism to convince some of these guys that this is their time. You know, and I mean, Pence is going to be like, and I've respected the man in the past but in this point at this point he's he's like the court's jester who finds himself on the throne addressing the formerly you know the deposed king who beat him i mean i mean he can say things um from the inside that the rest of them can't now whether or not he will another question but don't you think so i mean he was privy to all

sorts of inside things that coming from him one would have a tendency to believe he's he's in an obvious bind he was much too loyal to donald trump much too loyal to donald trump for three years and 11 months of that administration for the trump haters ever to forgive him and then he was too disloyal to donald trump for the trump supporters ever to forgive him. And then he was too disloyal to Donald Trump for the Trump supporters ever to forgive him. That strikes me as a pretty serious bind. On the other hand, again, this man is intelligent, articulate, he's deeply experienced, he's been a congressman, a governor, vice president. Let's see what he has to say. Sorry, Rob, Rob, you're on the rooftop there in

the village. Let's hear the view from the rooftop. Well, you know, I've always thought Pence, I mean, Pence is a lot more conservative than I am, certainly. And he's more conservative than I'm comfortable with, right? But he's a very good politician. And I mean, as you say, you don't get to win all those statewide without being good, especially in, um, in, in, in kind of the good, the good government Midwest. So I actually feel like he's a pretty decent candidate so far. I mean, he hasn't done anything yet, but it, you know, the outlines, I like Christie because Christie's a bomb thrower and he can think on his feet. And I've always enjoyed Christie.

I mean, I remember, I mean, this is how old i am i remember uh friends of mine in um show business when christy was like the big star in right right american republican politics in 2008 the first obama um uh term and uh when they before they would start work they would they would watch what they called christy porn they would go on youtube and they would find the chris christie video clips where he was just eviscerating this the press and eviscerating the teachers unions and it was all off the cuff and he was articulate and it was like this all we could think of is my god chris christie i cannot wait for him to be president united states um of course that was as i said many many many years ago but i'm he still seems to have that fire so So I'm excited about the fight, right? Like you are.

Yes. I'm a little concerned lately, though, that the two front runners who I'm calling the two front runners, they may not be the front runners. Trump and DeSantis seem to be having like a who's stupider contest for Trump to say, as he did earlier this week, that actually Cuomo, Andrew Cuomo, governor of New York, was a better COVID governor than Ron DeSantis is just stupid. It's almost indefensibly stupid. It shows a guy who just simply can't, doesn't recognize the problems with COVID, the problems that he caused, the problems that he inherited, and doesn't understand what happened with covid the problems that he caused the problems that he inherited and doesn't understand what happened and will say anything however idiotic to sort of score points it's just dumb um and then i expected ron desantis to be sort of smart and now ron desantis is saying things like well you know operation warp speed and the vaccination was a mistake and a disaster and and that's just stupid and i was actually impressed by donald trump's response to that to a to a voter who said hey what about this

vaccine and he really i mean operation warp speed is was one of these like stellar accomplishments of the trump administration and it was a blueprint for government sponsoring technological emergency innovation that will be studied and emulated i think i hope for decades so you know for ron de santis to sort of take issue with it it's just so stupid like why can't these two guys attack each other like uh you know right right they're supposed to they don't have to be dumb about it one of the things that trump's team has done is put out a series of tweets accusing r DeSantis of wanting a 23% sales tax on the nation, which looks bad. Gosh, gee, that's horrible. But, of course, the beauty of it now is that in the Twitter world, there's something called community notes.

Yes. And this has really changed the way these things work. It used to be that you could come out and say something like that. You'd have to go to the comments and scroll through a bunch of garbage to get to people saying, I actually know what he's talking about is the, you know, the fair tax that would be in place after we'd abolish the IRS and personal income tax. It's right there under the tweet. It's right there. Community notes, people have noted so that instantaneously you can have the most formidable, capable

communications team you want with great graphics and know-how as to when to time it and how to phrase it, which they don't. And instantaneously, it's undercut by one guy who's making a note that everybody else sees. And I think that's going to be cool.

And I think it's going to be a welcome addition to the political discourse. I mean, Matt Walsh said, not Matt Walsh, oh man, I forget his name, back during the early days of blogging, said, you know, this is the internet and we can fact check your butt.

And that was true then, but you had to go to a blog and you had to read a point. Now, it's real-time fact checking, which I don't think we've seen like that before. I agree. So far, I've liked it. I like that. Back to the candidates, I have to agree that so far, I have the feeling, I'm just being, well, of course, politics is a subjective business,

but I have the feeling that Donald Trump is not bringing out the best in Ron DeSantis. That DeSantis feels somehow he's got to get down low. It'll be interesting to see the way Chris Christie handles this problem. Chris Christie knows Trump, has watched him work for him. Of course, Christie's problem is that he was against Trump, then he was for Trump, and then he was against him again, and then he helped in the transition, and then he helped. Who knows, right, where it all ends up. But Chris Christie will be forceful. He'll throw punch after punch after punch, but something tells me there won't be the feeling that he's stooping that

he's climbing down into the gutter well because he's a fighter i mean that's because that's what he is i mean i actually was impressed i kind of liked it i mean i mean you know not i thought it was necessarily accurate but i kind of liked it when trump is attacking desantis for being a tax raiser that is what republican candidates do that is what that whenever trump behaves like a firebrand republican accusing his opponents of trying to raise taxes i'm like that's my sweet spot stay there right right whether it's true or not i mean it's actually rarely true the way they they talk about it but um i mean certainly within the republican party uh but i think the big difference here is going to be that in 2016 every single candidate on the day is there was trying to avoid going after trump right they all thought well leave this guy alone let him play his little game i'll be here to pick

up the pieces this time it's the opposite every single one of those guys in the dais has got to be the one that holds Trump's head aloft and say, I killed him. Otherwise, it's over. So if you're Pence i'm not going to those debates because every single person on that day is going after me because it's really the it's a kamikaze mission um and those are sort of dangerous opponents to have so they might all get they might all go down low what's gonna what's trump gonna say like why is everybody being so mean what happened to civility you can't say that well they're gonna hang fauci around his neck and burks and the rest of as they should as they should i mean i'm with you about the the vaccine deal i think that's a bad move for desantis but they can use fauci and they can use the rest of it and i mean the desantis campaign came out with a like a 90 second two minute clip of trump boasting about shutting it down we did the right thing we shut it down we did the right thing we

did the right thing in all kinds of contexts and various speeches and the rest of it now some of that may be cherry pick some of us may be saying oh yes in march in april we wanted to shut etc but it's effective yeah and it portrays and it says are you can you can you guarantee we're not going to get another lockdown from this guy um no as people are pointing out drug spending trump is spending his time defending the last four years that he had. And that's a long time ago. It's forever ago. Nobody wants to talk about that anymore.

We want to look forward. And when he talks about, I'm going to drain the swamp, I think, who was it today? Was it DeSantis or somebody with the others who said, well, look, you had four years. You had four years and you didn't do any of this stuff. What makes us think that you now older and more damaged uh is going to be able to do it again so yeah it's it's it's an absolutely fascinating time and i don't think anybody's going i don't think christy or pence will pull more than half of one percent that is probably i want to circle back to something rob just made a point i had

i hadn't thought of it this way but the way he just framed it is not only true, but I think the main dynamic we're going to see, at least in the first three primaries, and that, I'm thinking now in particular of Chris Christie, if you're Chris Christie, what are the incentives you face? Do you think you can actually get to be president? Probably not. Well, then why do you want to go in you want to go in for the fun of it because you want to be back in the action well how do you

enjoy yourself if you're chris christie you go after donald trump suppose you know suppose you already know there's a ch the chances are more than nine out of ten that you're not going to make it so if you go into this how do you avoid embarrass ah here's what you do you will have the gratitude of all your friends in manhattan and new jersey for the rest of your life if you're the guy who took him down and for the clear the president right right whoever the president is exactly and cleared the way for so i hadn't thought this is exactly the point that the incentives now for everybody in the race but in particular for for chris christie uh for desantis too but desantis at the same time he has to be worrying

about looking president not chris christie his whole aim here is to go torpedo like for that great orange presence. Hmm. Hadn't thought of it, but you're exactly right. Also, remember, there's bitterness there, right? Oh, yeah. And there's revenge, too. Like, Christie was supposed to be the Attorney General and Jared Kushner, because Chris Christie put Jared Kushner's father in jail, legitimately, by the way.

He richly deserved to be in jail. But Kushner said, no, we can't have Christie in the administration. Trump, of course, you know, he rolled a lot to Jared, which has been another series of problems. And so Christie wants, he wants revenge. There's nothing, I think, that drives somebody more than just that. Yeah. Mar-a-Lago meets the red wedding with chris christie in his medieval

outfit with a sword dripping with the grue and gore of the of the man he slain exactly speaking of grue and gore uh no it's actually not speaking of civility and fascination and intellectual perspicacity and the like larry cudlow columnist for the new york sun host of the fox business news shows cudlow which airs at 4 p.m eastern time weekdays we welcome him back uh with gratitude and warmth larry hello my favorite never trumpers oh it's a pleasure all right we got a deal should we be pleased about this dancing about this i mean gosh the deficit is going to go down by 1.5 trillion over the course of a decade, even though those numbers are kind of magical and suspect. Is this the best we could get?

Is this just politics as usual? What's your take? No, it's a good deal. I mean, Kevin McCarthy ran circles around Joe Biden, got him to completely change his entire point of view from a clean debt bill to a debt bill that has significant spending cuts and significant policy changes things like workfare and permitting and uh uh regular budget on appropriations and uh pay go on regulations everything his the way by the way mccarthy handled himself uh insistent but always open to compromise or talking the language of compromise and holding so many press conferences sort of off off-the-cuff meetings, you know, with reporters in the hallways of Congress.

I mean, he really did a masterful job. And he got two-thirds of the Republican conference with him. So I thought it was very good. And I think what you've got here, you know, this is something Newt Gingrich and I have talked a lot about on the air, and it's gingrich and i have talked a lot about on the air and it's something kevin and i have talked a lot about during this whole process you've got a a large first step towards restoring conservative uh economic principles and pro-growth principles

and anti-inflation principles so i I think it's actually a very important win politically, and it's a very important win fiscally, and it will help the economy a bit. And it's the first step. There'll be much more coming. Larry, can I, so you said that Kevin took Biden to the cleaners. Yeah. And the Senate has approved this now at one by about a margin of three to one in the House. He got most Republicans, overwhelming number of Democrats. All right. So, there are a couple of explanations here.

And I have, before getting to the question, I have to just... Kevin McCarthy's reputation, right up until the becoming speaker was very nice guy but the idea that he understood he himself never claimed to be a policy guy the idea that he understood policy that he understood strategy he was a wonderful chief whip he's the guy you want to count noses but Kevin as a negotiator so then this that we get this dead ceiling it seems to be there are two explanations one explanation is the Democrats suddenly realized how out of step they are with the great body of of the American people, or Kevin McCarthy is one shrewd figure. He has been underestimated throughout his career, and now we see him in action, and it's an impressive show. What do you think? Well, what about both, Peter? I'm leaving the great synthesis to you larry go ahead no i i think um

i think he's a very underrated guy and i think the public is sick and tired of biden's frenzied spending and government's central planning and regulatory overreach and inflation is still the number one problem and real wages are still falling look i you know kevin mccarthy is a longtime friend of mine uh when i was working in the white house i used to bring him into a lot of meetings with the president in the you know the dining the dining room behind the Oval Office late in the afternoon, early in the evening. One of the receptionists would say that, you know, Kevin McCarthy's here. I'd go out and instead of making him wait, I'd go out and bring him in.

And, you know, he's learned a lot. He's working hard he's a very positive experience. And the Freedom Caucus people, you've got some very, very smart Freedom Caucus people. And I think that helped him, improved him, made him a better speaker. And, you know, the turning point for this stuff was not so much the debt deal. It was the Republican debt ceiling legislation that they had. That was the shot across the bow. That changed the entire political calculus in Washington. The White House did not take him or the Republican House seriously. When they put

that resolution together, that actually wasn't a resolution it was a bill and the bill was well received that's the thing you have these middle of the road think tanks in washington like the peterson institute uh or the committee for um whatever it's called responsible federal budget maya mcginnis They came out and said, this is a good common sense bill. Well, that put tremendous pressure. And you've got guys like Jeff Stein, who's a pretty good economics reporter

for the Washington Post, writing about that and put tremendous pressure on Biden and the White House and made them realize between that and the polls that they were making a gigantic mistake. So, hey, Larry, go ahead. No, no, no, no, go ahead. Well, no, I was just

wondering where did that legislation come from? You've got between the speaker, Kevin McCarthy, and his chief whip, Steve Scalise, you've got two guys whose reputations are as nose counters, very good politicians, but who put together this bill who thought through the economic strategy you get if you want to say well actually i wrote it for them and they just called me if you want to insert yourself larry go ahead but where did it come from seriously well look um couple look there are are some former Trump office holders who helped, myself included, Kevin Hassett included. But you also have a lot of smart people in the Republican conference. Graves is a very smart

guy. The guy running the banking committee is a smart guy who was one of the two negotiators. McHenry, Pat McHenry, he's a very smart guy. Byron Donalds

is a very smart guy. French Hill is a very smart guy. French Hill is a very smart guy. I mean, I'm not going to go down the whole list, but there's a lot of talent, a lot of talent. You're going to see, you know, these House members who were junior members now becoming more senior members, many of them will go on to serve in the Senate or governorships. The GOP has a very deep base. And they're all contributing these policy things. You see, the mistake the Republicans made in the midterm elections was not specifying policy. It was general. You know, we hate inflation. All right. Well, we all hate inflation, but they never spelled it out.

We were begging them to. I don't know how many of them I used to have on the show, especially the Senate candidates. But anyway, inside the House, they're doing a heck of a good job. It's a very interesting policy laboratory. And I might also add McCarthy and Scalise and others have a number of former Trump staff serving on their the end of the day, I think a lot of people are thinking, well, I don't think we've ever had a weaker Speaker of the House, right? in all those ballots. And yet the guy somehow turns it around and he does a really great job and he sort of knows what he's doing. And he, um, he manages to keep a pretty powerful coalition together. He manages to make policy arguments that, I mean, you know, work requirements and things like that, but I think people really do feel strongly about all of that stipulated.

And yet I can't help but think that, you know, we're here again. Like, we're having these debt ceiling debates and crises all the time. What are we not fixing that needs to be fixed? You know, Rob, one of the great House speakers was Nicholas Longworth. I think he was the turn of the last century. I knew him very well. I knew him very well. Yeah, exactly.

He was married to Teddy Roosevelt's daughter. They thought he was a fop, but he turned out to be a hell of a good speaker. Just saying. You never know with these things. You never know, right. So, look, the problem in the last couple of years is the Democratic Party has moved far to the left. During the campaign of 2020, Joe Biden made a deal with Bernie Sanders.

I mean, he literally made a deal on paper. And Joe Biden said, people didn't pay enough attention to this, that I'm going to follow your lead, your guidance. So the party turns socialist. So they come into power. They have all three houses. And they go and spend $6 trillion.

And they put on the board $2 trillion worth of higher regulatory costs. And they wage war against the fossil fuel business. And some people called it modern monetary theory well modern monetary theory has utterly failed all right inflation is still high growth is low we're on the cusp of a recession the country is in revolt. Middle income, blue collar working folks, lower middle income working folks are losing money. Their take on pay is falling. You can't have that. It's not sustainable. So the left had their way. The pendulum swung way, way too far. And now the pendulum is beginning to swing back.

Do you think we're ever going to get out of this? I guess I have two questions. One is, it seems my premise is that we have an enormous federal entitlement problem. We don't seem to want to get our hands around that.

There are two solutions to this. One is to raise taxes and the other is to grow and i guess my guess my concern is and i just i'm asking for your prognostications because you are a you are a pro growth economist you've been arguing for growth for as long as i've known you um and you do you do it i mean i i basically steal your ideas and say they're my own that's that's how smart i think you are right rob you forget the third option returning to the gold standard now okay all right right right um assuming for a minute that we're not really we're not ready as a country to have a conversation about entitlement reform

because like you know that seems like a like we're not what are the what are the things we can do but what are the things that we as citizens and voters can agitate for and demand that are what big parts of a pro growth agenda that but growth agenda that reagan sort of um who is the greatest economics professor in american history taught us to focus on, which I feel like we're in trouble now because we're not growing. Alvin Coolidge wasn't bad either. Yeah, he wasn't bad.

Look, growth is everything. Growth is everything. You know, there's 6, 7, 8 million people, according to Nick Eberstadt of AI, who are able-bodied people who should be working and they're not, largely because they're being subsidized not to work by the federal government. And the McCarthy deal

made some modest but probably significant adjustments so workfare will gradually be restored in the next few years you know you put those people to work you're going to generate higher incomes for them but also at existing tax, you're going to generate more revenues, particularly payroll tax revenues. That's one solution. Now, the first thing you have to do is elect a Republican president and a Republican Senate to go along with the Republican House, okay. That is very important. I mean that. I know politically that's obvious, but I'm saying to you it's very, very important. And so far as entitlements are concerned, there are some structural issues that need fixing

and the way to do that is to appoint a commission and it's probably going to be a bipartisan commission, just like Reagan did. When I was a young pup working for him, and he had the Greenspan Commission, and he put Pat Moynihan on that, and he put Lane Kirkland on that, and the rest of us were staff members to help them. And they worked out a very good deal, a very good deal. And it lasted for about, I don't know, 40 years, 50 years. So you'll probably have to do something like that. McCarthy, by the way, announced that he would go for some kind of budget commission. Whether that will include the big entitlements, I don't know. I talked to him last onlements, I don't know.

I talked to him last on Sunday. I haven't talked to him this week. But, you know, that's what you'll have to do. But, Rob, growth is essential. I mean, look it. I've been carrying around in my briefcase the following. From the end of World War II, when the government statistics were made uniform and more reliable, between 1947 and 2000, the year 2000, the American economy grew grew at three and a half percent per year after inflation over 50 years unfortunately since 2000 the economy averaging now about 1.8 percent it had a little blip in George W. Bush's presidency, a little blip. And it had a similarly temporary blip under Trump.

But it's now lapsed back. In fact, the last 15 months, the economy has grown by less than 1%. What are we doing wrong? Well, there's too much government. That's what we're doing draping boat anchors around the neck of the beast that's right that's exactly right there's too much sand in the gears there's too much regulation trump did a good job rolling back regulations biden comes in and reverses the whole bloody thing okay uh they're starting to raise taxes again very bad the whole tax system still could be lowered

and simplified uh we also have flirted with inflation again i mean look we didn't have any inflation for about 40 years uh boarded green about six weeks into a roman orgy with it i mean look uh you know you laugh about the gold standard but people should use as a reference point for the value of the dollar they should use gold and a broad commodity index so covid covid with the emergency spending see here's here's the problem, the fiscal problem. We passed a $2 trillion-some-odd bill. Actually, it was probably close to $3 trillion. The so-called CARES Act in 2020, okay?

I was very much a part of that negotiating. Steve Mnuchin was our lead. I was his deputy. It was a bipartisan. Steve Mnuchin was our lead. I was his deputy. It was a bipartisan bill. It's something we had to do. And the Federal Reserve bought the bonds we sold and pumped up the money supply and commodity prices started soaring and so forth. Now, that by itself was not inflationary. Inflation didn't start till later why because when those programs started expiring in 2021 okay the biden's went in and what do they

do they put out a two trillion dollar so-called whatever it's called the american relief act which even good keynesians like larry summery summers yes asin firman uh firman's a terrific economist by the way he's a good friend of mine um austin gulesby said a little bit although he was bucking for a job but the point is you know what i will call adults responsible economic people on both sides of the aisle said, don't do this. Right. And they went ahead and did it. And they kept on doing it. And, Rob, they would have kept on doing it right through this debt ceiling, except they ran into Kevin McCarthy in a Republican House.

Larry, I want to return to this insight of yours, because I take it, well, let's put it this way. Reagan gets elected and says, in effect, the best we can do with Social Security is put together a commission, patch it up. They did patch it up pretty well. Save it for some period of a couple decades and take it off the table so we can get to what we can do, which is promote growth. George W. Bush gets reelected and says, I'm going to devote my second term to entitlement reform, and he wastes an entire year taking on Social Security head-on and getting exactly nowhere. The central insight here is you do what you can with entitlement programs, but you don't go down rabbit holes. Republicans need to save their principal energy, their principal fight for tax cuts and rolling back regulations and promoting growth.

You can contain the welfare state, but the name of the game is permitting the private economy to grow faster than the welfare state. Correct? Correct. All right. You're allowed to say more, Larry. I just, we see so rarely says correct to you. That's the problem. The first time I've known Larry for says correct to you that's the problem the first time

i've known larry for 40 years and that's the first time he's ever thought i got anything right i'd say this group on the whole has been definitely picked its game up inflation and uh a recession will do that it tends to focus the mind listen uh biden socialism has united all of us exactly right i'm in minneapolis right now i'm in a 52-story skyscraper that's probably got about 12 people in it uh downtown minneapolis is coming back slowly new york is in bad shape as we're learning all the real estate values of some of the class A stuff is just cratering. There's excess capacity.

They're starting to refinance everything. So commercial property in New York is finding its floor and that may be good and burn out some of the excess and the rest of it. People are talking about, we've got to convert these empty office buildings as class B stuff from the 60s into housing. But there's all these green regulations that say they have to do this and that and this and that, which makes it incredibly expensive to do so. Commercial real estate in downtowns in general, if you're not in Florida, is in trouble. And this affects the finances of cities

a lot. So we're going to see a shakeout in this, aren't we? What is the ripple effect through the economy, nationwide in particular, of what's happened to commercial real estate? Because everybody went home and nobody wanted to come back. Yeah, well, I agree with you, by the way. I think your analysis is spot on. And commercial real estate is going to go through its first correction in about 20 years. Now, is it going to decimate the economy i don't know uh i think some of these um some of these regional banks are going to get hurt we haven't heard we haven't

heard the last of that problem um the people that run these REITs and commercial building funds and so forth are going to get hurt. Investors are going to get hurt. But don't forget that land has value and the buildings have value. So you're going to get a shakeout. Managements will be thrown out. New managements will come in. Rents and prices will be thrown out. New managements will come in. Rents and prices will be adjusted. You know, it'll be a classic form of a capitalist kind of correction. And will it hurt the economy? Yeah,

it will in the short run. Is it going to be catastrophic? No. I think that will lead, however, in the next year or two to, you know, the government, the lefties are going to try to have a big bailout for this type of stuff. And the conservatives will oppose it. And the public, I think, will also oppose it. I think the public is sick of bailouts. But, yeah, I agree. There's a commercial real estate coming, a shakeout coming. Not residential so much.

Residential has been hurt badly by high mortgage rates, but it'll be more commercial. Mortgage rates, Jack, and I took a little steam out of the bubble. But before when we had real estate corrections, I mean, I remember the time when, oh my gosh, the Japanese are buying everything like they were going to buy the Empire State Building and disassemble it and move it to Tokyo. No, they bought a bunch of stuff here. Prices went up, and then eventually things happened, and the market went down. But there still was a demand for office space. It seems like a fundamental shift has happened where the existence of an office building is no longer the guarantee that it used to be. I mean, it used to be, yeah, we're going to put up a big 70-story skyscraper on Park Avenue for J.P. Morgan, whoever,

and people will come to work there in their suits and their ties, and they will be productive. But you don't have that paradigm anymore. And that has to make this a different correction than it was before. Or are all corrections basically the same? Corrections are basically the same. I would say,

you know, inside your view, and I agree with your view, there are cultural issues that are troublesome to me. I mean, look, a lot

of these kids don't want to work. They don't want to go to work, and they don't want to work. They don't want to go to work and they don't want to work. And that's not good. Now, I think that will change as they mature. And there is now a counter revolution about, you know, people. I mean, I'm nonstop. I wanted work requirements in this house bill i started talking about it uh right after the election i've never stopped guys like bill

bennett have them on the show all the time we you know we talk about the dignity of work the sanctity of work work is work is godly but the trouble is the left hates religion they don't even think in those terms so that is a cultural issue that is a very important sidebar to your economic uh point uh rob i just want to tell you larry said that my analysis on growth was correct and then james lilacs gave it gave a real estate analysis and larry cudlow said correct robinson correct lilacs correct long this is by definition correct um but i have a cultural question right because i feel like sometimes a lifetime you've spent in finance and economics and business there's something you know that

maybe we need to hear uh and i know you're an optimist so i i might i just i hope i know what your answer is going to be but let me tell you what a friend of mine told me grew up in detroit in the 50s and 60s and when you're growing up in the detroit area 50s and 60s. And when you're growing up in the Detroit area, 50s and 60s, there were not that many toy stores because everybody had tools in their basement. And when your kid wanted a train set, it was considered kind of uncool to go and buy a train set. You could make a train set. You have a better train set. So even now, you go to garage sales in the Detroit area, and there are these train sets that are very specific gauges you could never buy trains for because they were made in someone's basement and his point is he said America's never really gonna come back roaring until we have a bunch of dads and a bunch of moms too a bunch of Americans who just want to go down to the basement and they know they can make their

own train set do you know what I'm saying? I guess this is a long-winded way of saying, are we going to be okay? It's funny. So I'm 75 years old and very grateful to be kicking. You look pretty good, by the way. 75, man. I'm looking forward to that. But I remember my train set in the basement of our house in Englewood, New Jersey, where I grew up. And I remember not only setting it up with my dad, with my mom watching periodically, but actually working it. And we had

a beauty. We had a beauty downstairs. And I remember that. That's a wonderful thought. A very comforting thought. So, you know, it's a complicated subject. Are we going to be okay? I believe we will be okay. Because we will be okay because we are a democracy and we are a free country and we are grounded in what i would call traditional conservative values and we have been assaulted by the left in recent years. It's really not just these Biden years. The Obama years unleashed this. But there'll be a counter-revolution.

I truly believe that. People are putting their foot down. Enough is enough. And, you know, you need families. Look, you need traditional families okay you need two parents to be with their kids and teach them and to take them to church or temple you need that i'm sorry I believe this in my soul. Last fall, I was honored. I mean, truly honored. One of the greatest honors of my life.

They gave me, National Review gave me the William F. Buckley Prize. And there were four or five hundred people in the Reagan aircraft thing in the library. And I got up and I spoke about a lot of things. Bill Buckley was a very dear, Bill and Pat Buckley were very dear friends of ours. And some of my worst days professionally occurred when I was on the staff. And then I recovered. And we were dear friends afterwards. Actually, Bill loved my wife, Judy. He liked me, but

he loved Judy. But where I'm going with this is, I spent a fair amount of time talking about Bill's belief that you must have a religious foundation in society. And my pal Catherine Lopez wrote a lovely piece after that event, which was called God and Man at the Reagan Library. And she captured absolutely.

I mean she's a brilliant woman. And she captured exactly what I was aiming at. So how long? How to? I don't know Rob. But I know it works. I know it works. And I know there are a lot of people in this country that know it works. I know it works. And I know there are a lot of people in this country that know it works.

And I know we're in a slump right now. And I know we're in a bit of a decline. But in my lifetime, which has spanned declines and recoveries, I've seen how we can and will recover. And that's why I'm an optimist. And, you know, I do go to church on Sunday. And that helps too. That note, a tonic chord, in fact, we will end. Peter and myself are correct.

Rob, we'll just leave him for the next one. And we look forward to hearing from you in whatever position you happen to take in the DeSantis administration. Larry, thanks for joining us today. Thanks lot fellas let's hope bye-bye i appreciate thanks larry there's only one thing i want to know uh rob uh who in detroit was going down in the basement and hand wiring the armatures of their electric transformers to run the things and hand forging the little cars and the clipping things. I mean, I can see people putting their own train sets together, but making from scratch? From scratch.

These were machinists in the great American car industry. They were incredibly skilled workers, and they had all the tools at home. They probably had some tools they took home that they might not have been authorized to take home, but they had them. You would have to have equipment that was capable of nanosurgery sometimes to get some of these little small things. I mean, are you saying that it was dissolute for the other kids to just get a Lionel set and put it together? I think that there was, from what I understand, that if you were a guy working in the car auto factories and Ford Chrysler GM all over Detroit area, that you considered a point of pride to make those toys.

And you could. And you had the tools and the equipment. And you had the skill. And you had the technology. You had the... Working the assembly line at Kaiser, and you're putting in this bolt, or you're fastening this part and putting into there. That is not a skill that translates to building from scratch an electrical

transformer and electrical motor. And what's more to hand what to make your own tracks with their own gauge and the rest of it. I'm not saying this didn't happen, but the idea of home brew electric train sets is something that I've never encountered before. And Ricochet podcast, ladies and gentlemen,

the only place you can get a debate on train sets in Detroit in the 1950s. Exactly. If you're doing a Ricochet meetup in Detroit, maybe somebody could get up on this one, Rob. And speaking of which. We should talk about the meetups. There are a bunch of scheduled meetups.

There's one in mid-July in Winston-Salem. There's the annual German Fest meetup in milwaukee it's happening the last weekend of july and labor day weekend meetup in cookville tennessee there's a bunch of meetups that are kind of tentative uh ones in columbus ohio late june the other is in mid-july in portland oregon which i think would be kind of that actually counts as an expedition um and then mammoth cave national park in kentucky in august that's got some takers look we like to meet online we'd like to meet at the ricochet.com um we'd like to meet when we do these podcasts you know you can if you're a member you can join us when we're doing them live

um but we also like to meet in real life so uh if you want to join please do please join ricochet.com and come and join us in one of the meetups. And if one of these doesn't work for you for whatever reason, just put up a post and say, how about this one here at this time? And Ricochet members will show up because that's what Ricochet members do. They do. Ricochet members show up. Ricochet members go to the site and post in the member feed where we have these little private conversations amongst ourselves that are great. Ricochet members know that when Rob is talking about the meetups, that that must mean that the show is coming to a conclusion. And they also know

that that means the inevitable plea for a five-star review on Apple for all the reasons that we've given in 644 podcasts. And if you're not a Ricochet member and you are still hanging on every little syllable and phoneme we are uttering here, we advise you, strongly as possible, to go to the site, check it out, sign up, spend a shekel or two, and see exactly why we call it the place on the Internet you've been looking for all your life. It's not Facebook. It's not Twitter. It's a community of sane, center-right, civil conversation. And in addition to all those other civil lengths, we're going to use the S word short because Peter Robinson has to scamper. Rob has to get out before the workers start their calamity again.

So almost my hour is almost over. But before, I know we have to go. Yes. Before we go, I just wanted to, I know, I don't think we fully, I mean, I am still always perpetually in awe of Larry Kudlow. I could listen to him all day and i just but i know he'll listen i want to thank him for joining us but also i i hope everybody loves him as much as i do because i think he's a great great great american it's it's fun to hear and and

again he knows things having as that is having seen things um and also and for somebody to have known things and seen things and remain optimistic is an american spirit that we love and cherish and encourage at a ricochet i mean that's one of the things about the political argument today we're gone we're dead best days behind us best to just give up on it all and go you know i we all feel that some days it's like what is the point what am i going to accomplish then Then you listen to Larry and you think, no, we can accomplish a lot. We will accomplish a lot, and we have to do it together. And by together, I mean all of us listening to this, members or not. But you should be a member.

Peter, Rob, it's been fun. We'll see everybody in the comments at Ricochet 4.0 next week. Hey, boys. Hey. Join the conversation.