This is a rush transcript from "Your World with Neil Cavuto," May 12, 2020. This copy may not be in its final form and may be updated.
(BEGIN VIDEO CLIP)
DR. ANTHONY FAUCI, NIAID DIRECTOR: If some areas, city, states or what have you jump over those various checkpoints and prematurely open up, without having the capability of being able to respond effectively and efficiently, my concern is that we will start to see little spikes that might turn into outbreaks.
(END VIDEO CLIP)
NEIL CAVUTO, FOX NEWS ANCHOR: All right, chewing on what Dr. Fauci had to say today, and, at the corner of Wall and Broad, when they heard it, they tended to think maybe, maybe we're getting a little ahead of this.
The scene right out of the White House as the president gets ready to meet with Republican senators to sort of sort out what Dr. Fauci was saying, because, late in the day, it did speed up some selling going on here, largely on concerns that maybe some states are not opening up as smoothly as they would like to see.
And then we had Dr. Fauci saying that, while a vaccine would be promising down the road, it did not appear imminent.
This might have just been an excuse to sort of pounce, take some profits over what has been a nice run-up. And, again, in the scheme of things, the markets have come back enormously, but worries just the same that the course of this virus, and now a $3 trillion plan that will add to our debt in the House, that could complicate things and maybe the expense of things.
There's so much to get into.
Let's go to John Roberts first at the White House on how all of this is sorting out at the White House there -- John.
JOHN ROBERTS, FOX NEWS CHIEF WHITE HOUSE CORRESPONDENT: Neil, good afternoon to you.
It's really difficult kind of to know exactly where we are in terms of all of this sorting out. The states have got their plans to begin to reopen. But the reopening does in some cases seem to be going slower than a lot of people would like. We're still seeing a lot of people out in the streets protesting against the slow reopening, saying that they want to get back to work.
They're beginning to get worried that the job losses are not going to be temporary, they're going to become much more permanent. And now, of course, with the House looking at a stimulus package, the White House, when the president will be talking with members of the Senate this afternoon, will be looking at what could potentially go into a phase four, even though the White House says it has pushed the pause button on a fourth stimulus for now.
But the president has made it clear that any future stimulus would have to include massive infrastructure spending, tax breaks for certain industries, and a payroll tax cut for employees, so that, as they go back to work, they don't get that 6.2 percent taken off of their weekly paychecks.
Here's what the press secretary, Kayleigh McEnany, said about it just a little while ago:
(BEGIN VIDEO CLIP)
KAYLEIGH MCENANY, WHITE HOUSE PRESS SECRETARY: Look, I won't get ahead of the president in negotiating, but -- and I certainly won't condition any future legislation on a certain proposal.
But I will say that the president has noted a payroll tax is something that he's looked at, not conditioning it on that, but noting that something he desires. And I won't negotiate here with Speaker Pelosi, but I encourage her to work with the president and help these low-income individuals get this tax cut that they deserve.
(END VIDEO CLIP)
ROBERTS: The only problem with a payroll tax cut, though, Neil, is you have to have a weekly paycheck in order for you to get that money back.
And when you look at some of the projections that are out there now from the Institute for Health Metrics and Evaluation, we thought that, by the beginning of June, which is just a little more than two weeks from now, that those numbers would have decreased to the point where you would almost be able to reopen the entire country.
But now those numbers have been pushed back to sometime in August. The death toll continues to go up. So a lot of people, a lot of governors across the country are looking at this and saying, exactly how can we do this in a way that's safe?
But, at the same time, there's pressure building on the other side that every week you stay closed adds another crack in that dam, where the economy just starts to come apart. And nobody wants that to happen, because, as was pointed out today in that hearing, the consequences -- and again in the White House briefing, that the consequences of staying closed become more and more dire with every week that goes on.
CAVUTO: John, I would be curious, has there been any reaction in the White House to Dr. Fauci's comments?
He was pretty low-key, but very earnest in saying, we don't want to get ahead of ourselves, kind of pooh-poohed a lot of the excitement around remdesivir and some of these other things, not negative by any means, but certainly not the kind of stuff that Wall Street, for example, wanted to hear.
ROBERTS: Yes.
You know, what's interesting is, on the issue of remdesivir, it was Anthony Fauci a couple of weeks ago in the Oval Office who was the one who was very bullish about the early results of the clinical trials.
CAVUTO: Right.
ROBERTS: But the White House does know Dr. Fauci's position.
They know that he is absolutely going to err on the side of caution. And they also know that he's right that, if some of these states do undertake an opening that is too quick, and they have a flare-up, an outbreak of coronavirus that gets out of control, that's not going to just hurt that state.
That's going to hurt everybody, because everybody will freak out and say, oh, my God, we can't do this, close everything back down again.
So, the president is watching this all very, very closely. And he is taking into account all of the advice of the scientific experts he has around him. But, then again, there's the political calculation, too, Neil, that the economy was his strongest point. It's in the dumper now.
We're headed for unemployment that we haven't seen since the 1930s. And the president would like to staunch that bleeding before it gets any worse.
CAVUTO: Right.
John Roberts, thank you very much, my friend.
In the meantime here, the Republicans, as he said, will be meeting with Republican senators, that is, the president. The House, of course, still not in session, but not getting any work done.
The fact of the matter is, Nancy Pelosi and leading Democrats have put their stamp of approval on a $3 trillion stimulus measure. You heard me right, $3 trillion.
Mike Emanuel on what they're cooking up.
Hey, Michael.
MIKE EMANUEL, FOX NEWS SENIOR POLITICAL CORRESPONDENT: Hey, Neil.
Yes, this massive bill expected on the House floor on Friday, 1,815 pages, a little light reading over the next few days. House Speaker Nancy Pelosi unveiled it a short time ago.
(BEGIN VIDEO CLIP)
REP. NANCY PELOSI (D-CA): The HEROES Act, focus on three pillars, opening our economy safely and soon, honoring our heroes, and then putting much- needed money into the pockets of the American people.
We can all agree that we must open our economy as quickly as we can. But we must do so based on science and data.
(END VIDEO CLIP)
EMANUEL: Also today, some of the top public health officials handling the coronavirus response testified in the Senate Health hearing.
But it was quite unusual, with the witnesses and Chairman Lamar Alexander all appearing by videoconference. There was a tense moment, when coronavirus survivor and medical doctor Senator Rand Paul suggested Dr. Anthony Fauci should stick to his expertise.
(BEGIN VIDEO CLIP)
SEN. RAND PAUL (R-KY): And as much as I respect you, Dr. Fauci, I don't think you're the end-all. I don't think you're the one person that gets to make a decision.
FAUCI: I have never made myself felt to be the end-all and only voice in this. I'm a scientist, a physician and a public health official. I give advice according to the best scientific evidence.
(END VIDEO CLIP)
EMANUEL: Those leading federal health officials warning about the risks of reopening things too soon, noting, we're not out of the woods too quickly, also talking about sending America's children back to school in the fall and noting they do not anticipate there will be a vaccine by then -- Neil.
CAVUTO: Mike Emanuel, thank you very, very much.
Mike Emanuel in the nation's capital.
Let's get the read on all this from South Dakota Republican Senator Mike Rounds.
Senator, what did you think of, I wouldn't call it a flare-up, but this little tension between Senator Paul and Dr. Fauci?
SEN. MIKE ROUNDS (R-SD): I think, when you have a good committee hearing, you ask hard questions, and you get straight answers.
I think Dr. Fauci gave a very straight answer. He said he's there to give the appropriate type of an opinion. But I liked the way they ended that meeting. He made it very clear that there was no room between himself, the other experts, and the president's point of view.
They have got to safely open up the country, but they have to open up the country.
The question is, is, how do you get it done as safely as possible? The president clearly is focused on opening up the economy, but he understands that he doesn't want to have any fallbacks in those states, because that could slow down the economy in the future.
So, I think it was a good discussion today. And I think we're moving in the right direction. We're just all in a hurry to get there.
CAVUTO: I just wonder whether that's been sort of glossed over, Senator, because Dr. Fauci did say, a potential rush to reopen the U.S. could lead to -- quote -- "little spikes that might turn into outbreaks."
Are you worried about that? Do you think some states are rushing it?
ROUNDS: Well, I think we all should be worried. We should be aware of it.
But that doesn't mean that we don't stick to our plans. We can't allow the economy not to get reopened. But we have got to do it safely. In South Dakota, we have got meatpacking plants. And, right now, you're seeing shortages out there.
CAVUTO: But he seems to be intimating there, Senator -- he seems to be intimating there, though, that it's not going that way in some states.
He didn't, to be fair, specify which states. Do you know of any that come to mind where you think that they have moved a little too quickly, they have -- they should dial it back, to Dr. Fauci's point, that, if they don't, we could see a spike in cases that could -- could turn worse?
ROUNDS: I watch the same news that everybody else does, and we see the same reports that everybody else does.
You will see some increases. The question is, at what cost? And so, first of all, we want to do it as safely as possible. We will learn from states that may not have opened up appropriately.
In South Dakota, we never shut down entirely. What we did was to use some good-old common sense. And in those locations where we needed to slow it down, people stayed home, people used masks.
But we're opening it up again, probably more rapidly than the rest of the country is opening up. I think we're doing it in an appropriate fashion. Other states will have differing points of view. New York is different than South Dakota. We're different than California.
CAVUTO: Right.
ROUNDS: Montana is going to be different than either one of those two states.
But I think the president was correct when he said that different parts of the country could open up at different levels. We will learn what works and what does not work.
But I think Dr. Fauci was being very clear and very honest with us when he says, let's do this thing correctly. And let's learn. Let's take -- let's take the safety precautions necessary. And I applaud him for being straightforward with us.
But I don't see a difference between his point of view, and I don't think that it's such an issue that we should say that he and the president are on different terms, because I didn't see that.
CAVUTO: OK.
Have you had a chance to see or at least get the bullet points from Nancy Pelosi and House Democrats' $3 trillion rescue plan, whatever you want to call it?
ROUNDS: They called it the HEROES act. And I think that was a terrible thing for them to do.
What this is, is an attempt to put their wish list together. And to name it HEROES is something that never should have been done. I was very disappointed in them using this -- this political statement they're making, and then to label it that way was just very, very inappropriate.
Look, they're trying to spend $3 trillion. And in the middle of it, they're suggesting once again such crazy things is using federal funds for abortions. Those are the types of things that we just simply can't handle. They know that that's a nonstarter in the United States Senate.
And they understand, at the same time, that they can't be talking about a $3 trillion bill without being able to justify it. We have already -- we have got over $2 trillion out there right now. Let's find out what's working and what's not.
And let's give some flexibility to the states on the money that we have already appropriated to them before we start promising and spending money that we don't have, because every single penny that we spend in the future, we have got to borrow.
CAVUTO: All right, so when they call for half-a-trillion dollars -- I got it.
But when they call for half-a-trillion dollars, Senator, in direct aid to the states in two sets of payments, another $51 billion in aid equally between all 50 states, what do you think of that? That's about a fifth of their entire package.
ROUNDS: Sure.
And, right now, we have already provided $150 billion to the states for COVID-19 expenses. But we probably didn't make it as flexible as I think we should have.
I introduced legislation last night to allow the states, local units of governments and the tribes to use up to 25 percent of the money that we have already appropriated and already allocated for basically revenue replacement.
But we didn't go so far as to simply give them a blank check and say, here, take care of the problems because you have mismanaged your expenses in the past. And I don't think that that's going to be anything that Republicans are going to do in the near future as well.
CAVUTO: All right, Senator, thank you very, very much. Good seeing you again. Be healthy. Be well.
ROUNDS: Thanks, Neil.
CAVUTO: Senator Mike Rounds of South Dakota.
All right, we're going to be following that -- again, that spending initiative on the part of Democrats. Was it more a political document than a substantive one?
Why many are looking at this as a no-starter, but that some money will be spent. Three trillion, probably not. Two trillion, probably.
Stay with us.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
FAUCI: There's no guarantee that the vaccine is actually going to be effective.
As you well know, because we have discussed this many times in the past, that you can have everything you think that's in place, and you don't induce the kind of immune response that turns out to be protective and durably protective.
So one of the big unknown is, it will be effective. Given the way the body responds to viruses of this type, I'm cautiously optimistic that we will, with one of the candidates, get an efficacy signal.
(END VIDEO CLIP)
CAVUTO: Some are tracing the market sell-off late in the day to the realization that, as far as Dr. Fauci is concerned, although vaccine possibilities and potential treatments are out there, there's no guarantee, A, that it will be quick, and, B, they might even be effective.
Let's get the read on that from Dr. Craig Spencer, an Ebola survivor, I might add, New York City emergency physician.
Doctor, very good to have you.
What do you think of -- was there -- the worry that came out of those comments, was that justified, to you? I mean, the response was, on a lot of people, it was like a downer. It was a Debbie Downer. Was it?
DR. CRAIG SPENCER, COLUMBIA UNIVERSITY MEDICAL CENTER: Absolutely justified.
Look, the fastest that we have ever made a vaccine has been four years in the late 1960s for mumps. The average time that it takes is 10, 15, 20 years, because there are multiple steps, in addition to actually knowing that you have a vaccine that works, to getting that vaccine into the arms of people all around the world.
Right now, there are multiple trials that are going on. There are multiple candidates. And I'm glad that Dr. Fauci is optimistic that at least one of them will pan out.
What we need to remember is that we don't exactly know if they're going to be 100 percent effective, meaning that, if you get vaccinated, if this actually provides full immunity or full protection. There's a lot of vaccines out there right now, including the flu shot, that does not provide 100 percent protection, as many people know.
In addition, we will have to think about, do we need multiple doses? There are many vaccines that require not just one, but sometimes two or three vaccinations. That's going to make it a lot harder to ramp up and have enough so that people are protected.
And, really, the biggest issue is not just the amazing feats of public health of making a vaccine, but producing it at scales that we're going to actually need.
If you think about just giving it to health care providers all over the world, that's millions and millions of people already. How are we going to make sure we prioritize the most important groups, including health care providers, the elderly, people that are disproportionately impacted by this?
And how is everyone going to respond when they know that we have a vaccine, but we just don't have enough of it for every American and every person around the world?
CAVUTO: And then, Doctor -- and this is interesting in your case, as an Ebola survivor -- what if the virus mutates or changes or alters its composition?
I know that was a concern with Ebola. Then what?
SPENCER: Yes.
There was that concern with Ebola. There's always this concern that keeps coming up that viruses mutate. Well, all viruses mutate all of the time. That's how viruses work. The question is, do they mutate and become something more dangerous and more infectious?
We did not see that with Ebola, and we have not seen that with coronavirus. Certainly, there are small mutations, but none of them have been proven to do anything more than what we already know the virus does, which is infect a lot of people and kill a relatively small, but not insignificant, number of them, as we have seen here on the front lines in New York City.
Changing viruses, mutations absolutely can make it harder to develop a treatment, depending on which type of treatment. Same for a vaccine. As of right now, what we're going to have to do is really throw all of our hats and all of our chips in the ring and hope that one of them is good, because we don't have really anything else, other than good, solid bread-and-butter public health, to tackle this outbreak, until we have a treatment, until we have a vaccine.
And it may be that both of those are still a long way off.
CAVUTO: What do you think of the pace of reopenings, Doctor? I mean, it seemed like Dr. Fauci was concerned, even though he didn't identify certain states by name, those that might be acting prematurely or not -- or doing so when they really haven't got all the statistics in their favor to do so.
Where are you on this?
SPENCER: We have seen this recently in the past couple days in China, and more recently as well in South Korea, that, even after you reopen, even after your cases are almost zero or are, in fact, zero, you're still going to have these clusters, you're still going to have these outbreaks that can be started by one or a few people.
Our new reality is going to be such that, even once we get this under control, we're not going to be able to have large gatherings, because we know that they're too risky.
The difference between what we have seen in Wuhan and what we have seen in South Korea and what we're seeing here in a lot of states in the United States is that, there in South Korean and in China, they had basically broken transmission down to near none, meaning that there was very little community spread.
We have a lot of states and communities that are reopening, despite the fact that spread is actually increasing, case numbers are actually increasing. This isn't due to just increased testing. It's due to the fact that there are just a lot of cases out there that we haven't identified.
And each one of those cases that we don't identify has the potential of spreading the disease further to more people, who, again, if they don't get tested, are also likely to spread this along.
Everyone wants to reopen. Public health professionals, epidemiologists, everyone wants to get back to have an economy that is that is running again. We know the impact this is having on not just COVID patients, but on non-coronavirus, non-COVID patients.
CAVUTO: All right.
SPENCER: My family -- my dad has had his hours cut. My mom is out of work. Everyone in my family has been economically impacted by this.
But my concern, as a public health professional...
CAVUTO: We got to be careful.
SPENCER: ... is that, if we do this too quickly...
CAVUTO: All right.
SPENCER: .. we're not only going to put more people at risk now, but that the backlash and the impacts further on, weeks, months, and maybe even years later...
CAVUTO: All right, Doctor.
SPENCER: ... could be more substantial than the economic impact that we're seeing now.
CAVUTO: Doctor, thank you.
Stay with us.
(COMMERCIAL BREAK)
CAVUTO: Well, read it, and you would think homebuyers would leap. Interest rates are ridiculously low, mortgage rates now about the lowest they have ever been.
We will take a look at 30-year or 15-year mortgages that are fetching something that, well, did I tell you the story of how my wife and I paid that per day when we got our first place? Three-and-a-quarter-percent on a 30-year, 2.75 on a 15-year. A lot of places, you can do better than that.
Here's the problem, though. A lot of people can't take advantage, because, A, many of them are behind on their mortgage payments right now. And, B, a lot of them lost their jobs, hoping to get them back when, well, we all get back to work. They hope they get back to work.
Jay Farner on that conundrum. He is the Quicken Loans CEO.
Jay, good to have you.
JAY FARNER, CEO, QUICKEN LOANS: Yes, thanks for having me, Neil. Appreciate it. CAVUTO: You know, let me get a handle on it.
It looks like close to 10 percent of homeowners right now are behind on their mortgage payments, and have missed at least one. Where do you see this going?
FARNER: Yes, so, we're not seeing that level here. We're seeing about 5 percent right now.
I think it varies a bit based on the type of loan product. But it's something to be concerned about. And you referenced, why not -- why the entire population isn't taking advantage of low rates.
I will throw out a third, which is capacity. So we have seen our growth occur in the last 60 days. We have gone up 200 percent. Meanwhile, in the overall market, it's down 20 percent. And I think that's a function not everybody being able to process, underwrite and close these loans.
So you got to find the right lender who can take care of you, but that's playing a big role right now.
CAVUTO: You know, I guess, to your point, Jay, it depends on the market, but a lot of homeowners hold back, thinking, all right, we're going through this downdraft with the virus, I don't know where it's going to go, but I know it could imperil my getting top dollar for my home, so I'm just going to take it off the market, or hold off putting it on the market.
How much of a phenomenon is that?
FARNER: Interesting, because we have seen, in the last week, roughly a 10 percent increase in our clients calling up, asking to be pre-approved or fully approved for a mortgage.
But, to your point, right now, supply is low. We think, as you were talking about states coming back online, we get into June here, we will see supply increase and balance out. And so prices haven't dropped yet.
Now, if you watch what Fannie or Freddie are saying, they think we might see a dip in mortgage applications later in the year. Of course, that could put a bit of a damper on prices. But, right now, we're not seeing a drop in home prices at all.
CAVUTO: A lot of it is psychological. It's confidence, people feeling good or not. And this whole coronavirus freeze on activity, I'm sure has affected their -- their mood and sentiment.
And you mentioned, of course, just administratively getting -- getting the process going, and a process that is overwhelming. Where do you see it going once -- and we hope soon -- the whole country is kind of back? What do you think?
FARNER: Yes.
Like, we mentioned, we see lower-than-expected forbearances. So that means that the vast majority of our servicing book is making their mortgage payment. People are being cautious and thoughtful. But we're also seeing a strong demand for homeownership.
I think that's been just based on the last 60 or 90 days of people focusing on their home, living in their home, recognizing the importance it plays in their lives. And so it'll be interesting to see how that focus and desire to be a homeowner balances out with the unemployment rate hopefully dropping as we start seeing these -- these businesses come back online, and we will see people regain their jobs.
And I think that's why people continue to make their mortgage payments. Even though they're uncertain about their future, they're hopeful they will be back to work soon. In our state, of course, construction has turned back on. A lot of medical is turned back on.
And so we're crossing our fingers, hoping that that will keep going, and we will have a strong low interest rate, but also a strong homebuying season.
CAVUTO: Do you see the shifting, though, Jay?
By that, I mean that a lot of people are leery, certainly in the New York metropolitan area, where I am talking to you from today, that maybe they're not too keen on commuting into the big cities?
FARNER: Yes.
CAVUTO: And that maybe they set their sights in less urban areas?
What do you see?
FARNER: Yes, we do see that, especially with Rocket Mortgage. We focus on first-time homebuyers.
And to your point, that increase we're seeing is coming from large metropolitan areas where, in most cases, first-time homebuyers have been living in apartments in more urban areas.
CAVUTO: Right.
FARNER: And so I think you're right.
I think there's a demand right now for residential, a little bit more space, a little bit more seclusion.
CAVUTO: Do you see rates staying around this area? I know it's a mug's game. They have been around this area for a long time.
But that people who worry, like, I better move fast, because rates will go back up, any chance of that in the near future?
FARNER: Well, you never know whether rates can tick up or tick down.
CAVUTO: Right.
FARNER: I think, if you look over the next six, nine months, we're going to see rates kind of operate in this channel.
But if you know that we're going to be in this range, the sooner you take advantage of the lower interest rate, of course, the sooner you're saving money. And that's probably the most important thing right now.
We're talking to folks and helping clients. We closed nearly $52 billion last quarter. We will do $75 billion this quarter. People are saving $150, $200, $300 a month on their mortgage payment. That's real money in today's economy.
CAVUTO: Yes, that's real money in any economy.
FARNER: Yes.
CAVUTO: Thank you very much, Jay. Good talking to you. Continued good health. Be well.
FARNER: You bet. Thank you.
CAVUTO: Jay Farner, Quicken Loans CEO.
All right, we have a lot more coming up here, including Elon Musk. He said he was going to open his plant today in California, even under the possible threat of getting arrested. He wasn't arrested.
And he's got an open plan -- after this.
(COMMERCIAL BREAK) CAVUTO: It's his car company, and he will do what he wants to.
Elon Musk going ahead and opening up a Tesla plant in California, even though local authorities say he could not. He was even willing to be arrested. He wasn't.
So, what's next?
After this.
(COMMERCIAL BREAK) CAVUTO: All right, well, he had threatened to leave the state if, if local authorities in California had not allowed him to open up his Tesla plant.
They didn't, but he opened it up anyway. No one arrested him. No one gave him a summons or anything else here.
Jonathan Hunt on what ultimately went down as the factory opened up.
Hey, Jonathan.
JONATHAN HUNT, FOX NEWS CORRESPONDENT: Hey, Neil.
Well, for a second day running, Elon Musk remains in open defiance of orders by Alameda County health officials with his Tesla factory in Fremont, outside of San Francisco, open and operating again today, after he sent his workers back to the assembly line yesterday with that tweet -- quote -- "I will be on the line with everyone else. If anyone is arrested, I ask that it only be me."
Arrests have not happened, and they seem unlikely to. As Tesla employees streamed into work this morning, the county sheriff said it was up to the Fremont police. The Fremont police said it was up to county health officials. They had set a deadline of 5:00 p.m. yesterday for Tesla to submit a safety plan.
And a county official told us a short time ago -- quote -- "The site- specific plan was submitted yesterday, and we're in the process of reviewing it."
There has, as you might expect, been a lot of reaction Twitter. To those who support the quick reopening of America, Musk is a -- quote -- "legend and a patriot." To others, seemingly more concerned about workers' health, he is -- quote -- "another selfish billionaire."
The president -- surprise, surprise -- weighed in too, writing -- quote -- "California should let Tesla and Elon Musk open the plant now. It can be done fast and safely," to which Musk replied on Twitter: "Thank you."
County officials say they will update us and Tesla once they have reviewed Tesla's new safety plan, although Musk has made it abundantly clear he doesn't give a jot what they think.
And a net worth of around $36 billion renders a potential $1,000-a-day-fine somewhat irrelevant, Neil.
CAVUTO: All right, my friend.
Sorry. I thought you were throwing a bite there, Jonathan. I was listening in rapt attention. Thank you very much, my friend.
(LAUGHTER)
CAVUTO: Good seeing you, Jonathan Hunt, on all of that.
Let's see what happens tomorrow to Mr. Musk.
We have a lot more coming up here, including the battle over, well, still more stimulus. What if I told you the latest $3 trillion round that Democrats are coming up with in the House is virtually all for states, not just a big chunk of it?
I have taken a look at it line by line, virtually all of it -- after this.
(COMMERCIAL BREAK) CAVUTO: All right, the powwow going on at the White House right now, the president meeting with leading Republican senators, no doubt thinking a reaction to this Democratic plan, a new stimulus plan, that's upwards of $3 trillion.
I have it on safe authority that Robert Wolf, the former UBS Americas CEO, chairman and confidant to one President Barack Obama, is not at this White House gathering as we speak.
(LAUGHTER)
CAVUTO: He is, though, joining us to talk about what might come out of that.
Robert, always good to see you.
ROBERT WOLF, FOX NEWS CONTRIBUTOR: Good to see you, Neil.
CAVUTO: Let's go through this. And I was still too. I was surprised. I knew a lot would be in state aid, but virtually, maybe minus $3.6 billion for election assistance -- I don't know what that means -- between cities and states, it's virtually the whole $3 trillion.
That's a lot of money. What do you think?
WOLF: It is a lot of money.
And what I would say, Neil, is, we absolutely need a CARES 4.0. So we need another relief package. We haven't even touched stimulus yet. This is just relief.
We're talking about really unemployment number near 25 percent. Remember, the Payroll Protection Program lasts through June 30. Most of the country's not even going to be open by them. And those companies that are open are probably at 25 percent of norm.
So, this depression, as we're calling it now, is pretty deep, and it's pretty quick. And the best thing we can do is make sure small businesses are ready to get up and running when the consumer starts coming back.
So, we're going to need a much larger package than what we have done before. And then the second thing, we're going to need...
CAVUTO: All right. You might be right about that. You might be right about that.
But I'm just wondering if it's going to the wrong people, right? I mean, $500 billion in aid for states in two sets of payments, $51 billion equally between all 50 states, $150 billion in aid to states based on population.
This is just variations of providing a lot of money to states beyond what even they collectively asked for. Now, you're pretty good with the numbers.
WOLF: Yes.
CAVUTO: And you became very, very wealthy keeping track have them and what went in and what went out.
I don't think anyone is keeping track of this or its ultimate purpose.
(CROSSTALK)
WOLF: So, Neil, on the state side, I'm probably more aligned with the National Governors Association.
They are asking for about $500 billion. I haven't seen what the House is asking and how it's being divvied up. But they're asking for $500 billion.
(CROSSTALK)
CAVUTO: Well, I just told you. Well, I just told you, it's roughly five times what that's called for.
They put it under different categories and labels. But this is a lot more than the half-trillion. I mean, is there any way to make sure it goes to those states? Is there any way to make sure, whether the state is run by a Democrat or Republican, that it's not paying for past administrative sins?
WOLF: Yes. Yes. The answer -- the answer, unfortunately, money is fungible.
So, we're going to have to be very data-driven here. We're going to have to make sure that the money goes to those things that are providing critical services and assistance during this time of pandemic and the foreseeable future, so, police, fire, first responders, education.
And we're going to have to look at how much revenue has been lost during this pandemic period, because if revenue is lost, and states have to keep balanced budgets, then we know that there is an inability to actually balance the budget without cutting critical services.
So, at this time, I'm all for the federal government helping the states. So I'm not for -- and you and I have spoken about it -- them bailing out prior pension mistakes and things like that.
This has to be based on the pandemic today and the revenues that have been lost during the pandemic. So, maybe it's...
(CROSSTALK)
CAVUTO: But how do you know, Robert, right? How do you know?
I mean, if you're leaving it up to the states, all right, here's your money, or the cities, here's your money, who's going to police that that is being spent for the right purpose?
In other words, we can do that maybe with airlines in a bailout, banks in a bailout. How do you police a governor on what he or she is doing with this or a mayor?
WOLF: Yes, unfortunately, everything -- all of these bailouts have to be much more prescriptive than just handing money out.
CAVUTO: Right.
WOLF: And we know that, right now, it's been done with a blunt instrument.
The first few, you know, what I will call relief packages, we're getting money out as fast as we can. Look at the payroll protection act program. It only got to maybe 10 percent of small businesses.
And, by the way, most of these businesses can't even open in time. So, we're not even sure how helpful that's going to be. So, we have to definitely change how we're handing out money.
But, unfortunately, the pandemic is moving way too fast than we could have ever imagined, right? Twenty-five percent unemployment in six weeks. I mean, so just think about that. That hasn't happened since the 1930s.
So I'm all for putting a few blunt instruments at work, like they did. But I think, going forward, we have to be much more thoughtful how we hand out the money, and we have to make sure that it's going to the right services.
CAVUTO: Well, this doesn't -- this doesn't look thoughtful.
I'm not -- I'm not trying to play politics with this, because, as you know, both sides rather hate me.
(CROSSTALK)
CAVUTO: So I'm just wondering that, I mean, this doesn't look well-thought- out. It's just like throw it all in a bin and dig in and get it, guys, right?
WOLF: Listen, Neil, I'm never for this kitchen sink approach where we put everything in.
CAVUTO: Right.
WOLF: This is what the Dem House is saying. The Republican side, McConnell, he's already said no to it without even reading it.
It's 1,800 pages. Maybe he read the first paragraph. So, we know that the bid offer is right now is zero, $3 trillion. I guarantee there will be a deal. It won't be $3 trillion, OK, but it will be a hell of a lot more than what zero is.
CAVUTO: Yes, I think it's going to be around $2 trillion. That's what -- I just made that figure up.
(CROSSTALK)
WOLF: I will go with that.
CAVUTO: All right, it's always fun, Robert. Thank you very much.
(CROSSTALK)
WOLF: Thanks for having me on.
CAVUTO: All right. Yes, what do we got to lose?
Robert Wolf, the former UBS Americas CEO and much, much more, certainly well-connected, actually to both parties, but particularly the Democratic Party.
We have a lot more here.
So many businesses are laying off. Isn't it refreshing to hear one that's bending over backwards not only to keep its workers, but hire thousands more? And times are not easy -- after this.
(COMMERCIAL BREAK) CAVUTO: Oh, if all bosses could be like this one.
Raising Cane's Chicken Fingers announcing plans to give back to its workers for their hard work throughout this, not laying off anyone.
And now, now Todd Graves, the Raising Cane's Chicken Fingers CEO, is saying, you know what, I'm going to expand and hire some more people. Don't know how he's managing to do that in the middle of all this. Maybe he can explain.
Todd, good to have you.
TODD GRAVES, CEO, RAISING CANE'S CHICKEN FINGERS: Thank you, Neil.
The last time you and I talked was right after Hurricane Katrina almost 15 years ago. And I have to say, you have aged well, my friend.
CAVUTO: Is that right?
GRAVES: Yes.
(CROSSTALK)
CAVUTO: Well, you're not doing too shabby yourself.
But I find it to be the makeup, myself, Todd. But I digress.
But let me ask you. You could have joined all your food colleagues and just say, look, the well has run dry, my place is shut, I'd love to help you out, but that's it.
You didn't do that. Why not?
GRAVES: Well, I mean, this is -- this is my baby.
Raising Cane's, I started in 1996 after I commercial fished on Alaskan fishing boats to raise money for the first location. So, like, my crew is my family.
And when we started tracking COVID spreading in China, we knew it was going to get bad and get bad in the U.S. And so I rallied the team to say, look, we don't know what to expect right now, but it's not going to be good. And our goal is to go into this, and we're going to save every crew member's job.
And we rallied around the mantra of no crew left behind. And our teams went to work. And what we had to do was, using our drive-through format, we had to get really entrepreneurial and we had to get better at what we do.
So our sales went down about 30 percent in the beginning, and -- once the stay-at-home mandate started. And when we have that, we're bleeding cash. We make small margins on very large volumes.
CAVUTO: Right.
GRAVES: And we positioned the crew to get after it. And we were already one of the fastest in the industry in drive-through times. But we improved that by a minute by doing different methods, other -- other car stacks, three- car stacks, handhelds, moving through.
And we also went up on order accuracy and customer satisfaction. So, boom, I'm excited for my crew. They're the ones that did it. And not only did -- were we able to save everybody's jobs by doing that. We were able to give them a $2 million bonus, because our crew actually took a little bit less hours, all of them, to save everybody's job.
So I'm really proud of our team.
CAVUTO: What I love about your team is, they're not judgmental.
Like, when I go through the drive-through and say, all right, and get six large carton of chicken fingers, and they say, but there's only one person in the car, and I -- and I would always say, well, that's fine. Just load it up.
But it's interesting too what you were mentioning here, because I was reading this about you, Todd. Very early on, you had an idea about this virus, that it wasn't just some limited, fleeting medical event.
How did you know that? How did you get wind of that?
GRAVES: Well, I mean, watching -- we tracked Starbucks in Asia. And when they started shutting down their units, that gave us concern, right, when you start thinking about cash flow.
CAVUTO: Right.
GRAVES: And then we also saw the Chinese government making people stay at home and doing mandates.
So, when we did that, we immediately drew on our credit line and knew it was coming. And we knew it might be as bad as when the government wouldn't even let you out of your house. And that's what happened in China.
And when we talked the last time after Hurricane Katrina and the levees broke, that taught me that many years ago, with only 28 locations, when 21 went down, to expect the unexpected and to really seriously prepare for the worst.
CAVUTO: But how were you prepared for it happening here, to the degree it did, before almost any way I know of?
GRAVES: Yes.
Well, just to start with, draw all of your credit lines. Talk to your lenders, saying, hey, we're going to need this cash.
CAVUTO: Yes.
GRAVES: We don't even what we have to get through.
And then constant and clear communication with your team. So, it's literally from the beginning, down to me doing videos for my crew members that are going to them in text format, is, look, we have to be ready for this. But we're going to need everybody to stay safe.
And, look, it started with me explaining what COVID was, what is this virus, what does it mean, how are we going to stay safe, and really being on the forefront.
So I wouldn't cut commercials before the stay -- when I started hearing rumors about the stay-at-home mandates, just because we had to explain to our customers what an essential business was. Like, you can come to Raising Cane's, and we can safely serve you through our drive-throughs.
And we just kind of got ahead of the curve. Look, when you're an entrepreneur and you have to scratch and fight and -- for everything you do to make your first business work, that doesn't leave you.
And I think the businesses that have -- that have done well, and especially in my industry, have been very entrepreneurial. Look, Galatoire's is on...
CAVUTO: All right.
GRAVES: ... Bourbon Street doing a drive-through right now to keep their people employed.
So, you just have to be really, really, really crafty, and you have to have a great, great team to be able to execute.
CAVUTO: Well, you have a big heart, besides.
I wish you well, Todd. Start aging yourself, young man, but doing a lot of good for a lot of people, and the food, delicious.
All right, Todd Graves, Raising Cane's Chicken Fingers.
A lot more coming up, including some surprising guests to testify next week on Capitol Hill -- after this.
(COMMERCIAL BREAK)
CAVUTO: All right, you don't see this every day, crowded airplanes, not all airplanes, but look at this United flight, not exactly a pandemic-safe environment.
Mark Meredith with more from Reagan International Airport.
Mark, what was going on here?
MARK MEREDITH, FOX NEWS CORRESPONDENT: Neil, good afternoon.
United is the latest airline to face outrage over passengers saying they could not safely social distance on board. Of course, as you know, there are fewer flights going out there right now, but fewer flights also mean the possibility that some planes will be packed.
We have seen images like this. United says it's now changing its policy because of people being outraged. They tweeted last night -- quote -- "Starting next week, customers on flights that are expected to be closer to full capacity can rebook on a different flight or receive a travel credit. We will do our best reach out about 24 hours out."
Now, meantime, the Department of Transportation is strongly reminding airlines that refunds for canceled flights are not an option.
(BEGIN VIDEO CLIP)
ELAINE CHAO, U.S. SECRETARY OF TRANSPORTATION: If the airline cancels your flight, they have an obligation to refund that ticket.
And, currently, there seems to be some confusion about, what is a cancellation, what is a delay, what is prompt?
(END VIDEO CLIP)
MEREDITH: A lot of people looking for those refunds.
The Department of Transportation, Neil, says they're working to make sure people get their money back -- Neil.
CAVUTO: All right, Mark Meredith on all of that at a very crowded Reagan International Airport. Not.
All right, in the meantime, I should let you know that the airlines are now telling their crews, you don't have to force passengers to wear masks. It's required outside, getting on the plane.
But, once inside, effectively, what the Americans and Deltas and Uniteds are saying is, you don't have to force the issue.
Now, how that goes over on the plane with the others who do wear masks, and seeing someone else who is not wearing a mask, could be bedlam. But, anyway, that's the new policy, adding to the confusion.
These are interesting times, my friends.
Here comes "THE FIVE."
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