Kim Strassel: Trump sending mixed message with Liz Cheney fight

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Kim Strassel: Trump sending mixed message with Liz Cheney fight

FOX News contributor discusses the GOP potentially ousting the Wyoming congresswoman on 'Your World'

This is a rush transcript from "Your World," May 5, 2021. This copy may not be in its final form and may be updated.

NEIL CAVUTO, FOX NEWS ANCHOR: All right, the cost of all of these rescue and recovery plans is going up, dramatically up, and now concerns that the president's own call to pay for everything he's offered might be off the map.

Take a look at this. The cost of the American Families Plan, originally thought to be about $1.8 trillion over 10 years, now closer to $2.5 trillion. That's an increase of $700 billion. If you want to put it in perspective with the American Rescue Plan, the American Jobs Plan, the American Family Plan, brace yourself here, the total cost now more than $7 trillion.

The price goes up. And how to pay for it, well, that leaves everyone with their hands up.

Welcome, everybody. I'm Neil Cavuto, and this is "Your World."

We crunch the numbers, you decide whether what we have crunched is going to crunch you and your bottom line. Up until now, of course, the argument has been that the rich will pay for all of this. But now we're factoring in even the record-setting tax hikes to come, and they don't come even close.

Let's go to Kristin Fisher right now at the White House on how all of this is resonating there, if at all -- Kristin.

KRISTIN FISHER, FOX NEWS CORRESPONDENT: Boy, Neil, that's a lot of zeros to crunch there.

But here's the deal. The White House, White House officials price the American Family Plan at about $1.8 trillion. But according to new analysis by the Penn Wharton Budget Model, it says that the White House has grossly underestimated that amount, to the tune of about $700 billion.

It says that the White House has underestimated just how much all of the things that it is proposing in terms of childcare costs and educational policies, just says it just did not take into account just how much it would cost.

But White House Press Secretary Jen Psaki was asked about this new analysis in the briefing today. And she said that she strongly disagrees with it.

(BEGIN VIDEO CLIP)

JEN PSAKI, WHITE HOUSE PRESS SECRETARY: We strongly agree -- disagree with the analysis, as do other independent experts. So we're going to rely on the majority of economic analysis out there and our own analysis in here. And we are confident we will be able to reach both our job creation projections and, of course, do it in a way we can pay for it.

(END VIDEO CLIP)

FISHER: So, the White House sticking by that $1.8 trillion number.

Now, about an hour ago, President Biden spoke about his first big spending bill, the American Rescue Plan. And at the end, he was asked about how he intends to pay for his next two multitrillion-dollar spending bills.

(BEGIN VIDEO CLIP)

JOE BIDEN, PRESIDENT OF THE UNITED STATES: Everything I'm proposing that be done to generate economic growth, employment, and put us in a position where we can outcompete any other country in the world with research and development and moving ahead, I pay for.

(END VIDEO CLIP)

FISHER: Now, to be specific, the president wants to pay for it by increasing taxes on corporations and the wealthiest of Americans.

But, as you know, Neil, Republicans on Capitol Hill and even some Democrats just really have a big problem with this.

Here's Senate Minority Leader Mitch McConnell.

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL (R-KY): There are a number of Democrats who share the view of Senator Manchin that what's being recommended here jeopardizes the future of our entire country, the massive amount of debt to deal with an economy that's coming back on its own, and getting back where it was in February of 2020.

(END VIDEO CLIP)

FISHER: So, President Biden saying today that he is still open to negotiations, still open to compromise with Republicans and Democrats like Senator Joe Manchin.

And, Neil, President Biden is now going to be meeting with some of those Republicans here at the White House next week -- Neil.

CAVUTO: All right, Kristin, thank you very, very much.

And we're just taking a math look at this, folks. And we're not really playing politics with it. But the numbers simply don't add up, that the $2.5 trillion that the president wants in higher taxes largely on the wealthy will not come close to paying for the more than $7 trillion of spending planned right now.

In fact, they have been adding to that spending figure, because some of the base costs have risen precipitously, including credits and how many get them for childcare, free college tuition and the rest for those attending a community college, that they were actually lowballing those numbers, and hence this is the position we're in.

So, when the president talks about all of this being paid for, the reality is, the mathematical reality is, we are nowhere near that. And that is what is worrying a number of Democrats on Capitol Hill

Amie Parnes broke that story in The Hill and has a little bit more for it.

So, Amie, ones of the things I was intrigued in your story is that Democrats are getting a little anxious about this the closer we get to the midterms. They think this could come back to bite them.

Can you update me?

AMIE PARNES, THE HILL: Exactly.

I'm hearing more and more, Neil, about the ram -- the political ramifications of what they're proposing right now. And some Democrats have told me, obviously, they don't want to talk about it. Some have talked about it openly. But a lot of them are kind of huddling right now to figure out what this is going to look like, how this plays out in the midterms.

And it's concerning to some of them. They -- one told me, one source told me: We don't know what 2020 -- what their -- what the endgame is here, what the Biden administration, what the Biden White House is planning here.

But it looks as if they they're planning that maybe they are going to lose, and so they're going to try to ram as much as they can right now, while they have control of both houses. And so I think that that is sort of what's playing on the minds of some Democrats.

People think it's unsustainable. They would like to -- these are more moderate Democrats, obviously. But they would like something that they can work with. And they think that the $6 trillion number is just inexplicable, and that they won't be able to explain it away in 2022.

CAVUTO: Yes, especially when that rises to $7 trillion or $8 trillion, depending on how things go.

But the argument has always been for the president, the thing he has going for him is the booming economy, things are turning around quickly, that that might negate whatever issues come up and how much money he's spending. Republicans say, you don't need to spend it.

People who are convinced that they're not paying for it, or at least thinking that, will maybe welcome it, especially if things look like they're continuing to chug along. What do you think?

PARNES: Right.

And the White House certainly thinks that they have the wind at their backs right now. Joe Biden had a relatively easy time getting the COVID relief bill passed. And so he has that momentum going. But I think this is going to be a tougher pill to swallow. And it's given a lot of pause to some of these more moderate Democrats.

And if he wants everyone to -- if this goes into reconciliation, for instance, and he needs his entire party, he's going to have a tough time trying to convince senators like Manchin and Sinema to get on board.

CAVUTO: Do you get the sense or the people you have talked to, Amie, that people don't care about deficits and debt anymore, that that -- I have heard this more often than not, even among Republicans, well, we used to be real vigilant about spending, but those days are gone, where it doesn't get the voter reaction in polls that it used to.

And I'm wondering if that's what they're hoping for. Pay no attention to this. Look at the shiny object of stimulus and economic reports that are -- that are improving coming your way.

PARNES: I think that that's sort of what they're counting on.

But a couple of sources I spoke to kind of gave some -- they have given some pause to that. And they think that it's not -- that doesn't look good or as promising when -- they think that when voters start to figure out what's happening and how much money is coming out, and how much this will cost them, that this won't be good for Democrats in 2022.

And some actually point to Obama and what happened after he pushed through the Affordable Care Act, and how that didn't play so well for Democrats in 2010 and how, even in President Obama's terms, they got shellacked. I think a lot of people are worried about what happens next, particularly because both houses are so close.

CAVUTO: Yes, very, very close.

Great reporting on this, Amie Parnes of the Hill. Thank you very, very much.

By the way, Republicans and Democrats have problems within their ranks right now, this very minute.

And Chad Pergram here to talk about how each are dealing with those problems -- Chad.

CHAD PERGRAM, FOX NEWS CONGRESSIONAL CORRESPONDENT: Good afternoon, Neil.

Well, this is the problem. You know, liberals are saying spend more. Moderates are very concerned, as Amie alluded to. And the issue for Democrats on this is not the filibuster. It's the -- the base problem here is, they don't seem to have the votes to be able to pass many of these things.

They're able to kind of pin this on the Republicans, saying, oh, we need to get to 60 votes, or we need to get rid of the filibuster. The problem is the math on the Democratic side of the aisle. And you know what this reminds me of, especially with the president's infrastructure plan and all the other ancillary things that go with it?

This reminds me of the health care fight in 1993-1994, Hillarycare, where they fought, because it was such a complex bill. This infrastructure package is so complex, and so many tax components to it, that they fought all of 1993 and 1994 and never passed anything.

I have been told that they don't think that they can get anything done on this infrastructure package probably until fall, at the earliest. And, again, as Amie alluded to, there are these competing thoughts inside the Democratic caucuses.

Do they go for broke, try to pass everything because they have the House, Senate and the White House, and then, if the voters kick them out next time, fine, they have passed these things, or do they try to protect those majorities?

You don't get the stars to align very often, and that's the concern right now on the Democratic side of the aisle. But the bigger issue right now is this legislative fatigue. They passed these big COVID relief bills, the last one $1.9 trillion. And, again, can they cough up another $2 trillion, $3 trillion, $4 trillion sometime in the next 18 months, Neil?

CAVUTO: Meanwhile, Republicans dealing with the whole Liz Cheney thing.

She could have the fight of her life remaining in leadership. How do things look right for next week?

PERGRAM: Well, interestingly, a lot of people don't think this is the fight of the life. I have not talk to a single Republican who thinks that she survives that leadership challenge next week.

Now, there was a February vote, a referendum on her. That vote was 145 to 61. She survived, mainly because she had the support of Kevin McCarthy, the minority leader. That's not the case right now. And, really, what this is, this is a proxy war between Republicans, those who are afraid to break with former President Trump and those who want to get back to the more core Reaganesque conservative values.

And President Trump certainly today has been flexing his muscle. Republicans, based on what Kevin McCarthy has told them, that they are better off sticking with President Trump, that that is the pathway to flip these five or six seats, and become the majority party in the House of Representatives right now.

And here's the irony. There's been a lot of criticism from President Trump directed at Liz Cheney. She voted 93 percent with President Trump. And Elise Stefanik, the Republican congresswoman from Upstate New York, who is poised potentially to step into the leadership role next week, if she's defeated in this leadership race, she only voted with President Trump 78 percent of the time.

That's remarkable. So, you have this battle inside the Republican Party between what are true conservative values or whether or not they are just the party of Trump still. And it looks like it's more just the party of Trump right now.

CAVUTO: All right, Chad, thank you very, very much.

We will be exploring this very issue of the Liz Cheney phenomenon here a little bit later in the show, why she is being fingered for calling the president some names and going after him, when the president has called, well, Liz Cheney and Mitch McConnell and Mike Pence and Mitt Romney lots of names. No problem on that side.

So, we will explore that.

We will also explore a phenomenon during the great pandemic. No one was making any babies. The numbers are in, and the birth rate the lowest since 1979. Jimmy Carter was president, we had long gas lines, the Sony Walkman was introduced, and Michael Jackson's "Off the Wall" was a megaseller.

What happened?

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

NARRATOR: Sony introduces the only cassette player as small as a cassette case, an incredible sounding super Walkman.

(END VIDEO CLIP)

CAVUTO: That was the Sony Walkman, kids. I remember the day very, very well. It was 1979.

(LAUGHTER)

CAVUTO: And that was the coolest thing. Forget the iPhone and all these other fancy-schmancy devices. That was cool.

Michael Jackson's new album "Off the Wall" was very cool, up to that date, the bestselling album of all time. And don't even get me started on the other problem that was going on, those long gas lines in the second big oil embargo against this country by OPEC.

But you know what else was going on back then that mirrors what's happening today? People weren't having babies. We're at the lowest count of baby- making, if you will, in United States history going back to 1979, when Jimmy Carter was president.

There are a lot of rationale behind this and the latest dearth of births here. But the fact of the matter is, maybe people were just anxious during the pandemic and the scary world that it was to start the baby-making process.

Or it could be just the fact that it's expensive or a problem or they put off or whatever. Bottom line, it's that great '70s show all over again.

So, what happens now?

Let's go to Kat Timpf, the FOX News contributor, FOX Nation "Sincerely Kat" host. We have got Mike Gunz back with us, Gunzelman, as we call him, or Gunz, Internet radio sensation, and Danielle McLaughlin, attorney, good read of all things that have to do with, well, our inability or maybe non- desire to procreate.

All right, Kat, to you first.

In this world, what is it saying that people are holding back on children?

KATHERINE TIMPF, FOX NEWS CONTRIBUTOR: Yes, I am holding back on children. Even though I have been married for four whole days now, still haven't gotten on that.

(LAUGHTER)

CAVUTO: Congratulations.

TIMPF: Thank you.

Because I honestly think that people...

CAVUTO: Gunz, she's off the market. Gunz, she's off the market.

TIMPF: But go ahead.

(LAUGHTER)

TIMPF: People have seen so much uncertainty throughout the years, especially millennials in our lifetimes. I mean, how many times did the stock market crash?

And then this whole thing with COVID, where it's like, is there such a thing as a secure job or actually being secure in your -- the American dream and your place in that? So, obviously, people are going to be a lot more afraid in the wake of all these things to bring another human into this world, when it's becoming more and more uncertain how you can even take care of yourself.

CAVUTO: Yes, I think about it.

If you think about it, Gunz, there were a lot of people that came out in these surveys and people are talking about this that these are anxious times. I can understand not wanting to bring a baby in and all the health risks around the pandemic.

But the truth of the matter is, this trend has been going on for years. It picked up some steam here over the last year, I grant you, but something's going on. What do you make of it?

MIKE GUNZELMAN, FOX NEWS HEADLINES ENTERTAINMENT REPORTER: Yes.

Well, we have gone from baby boom to baby bust, it seems, for the last couple of years. And I think the -- at least for last year, the two main contributing factors would be the two F's, fear and finance.

Now, fear, especially for last year, because you couldn't even go outside. Really, did you want to welcome a newborn into the world when you didn't know what was going to happen?

But the financial aspect I think has been going on now for a couple years, where it's just the uncertainty of, I don't even know if I can take care of myself, my spouse, and now I'm going to have a child as well.

And a lot of that, I think, has to do with debt, I think student debt, I think credit card debt, I think job uncertainty across all sectors and industry and -- industries and the workplace, that people are just, frankly, worried about just the financial implications of having a child.

And you put that together with the fact that people are living longer and that maybe our parents, it was kind of instilled into them that you will go to college, if you go to college, and then you're going to have children right afterwards, and then all of that.

Now, it's like people want to travel, people want to maybe figure out their financial worth situation before they go to that next step with the -- with their spouse.

CAVUTO: Well, you could be right.

But, Danielle, it's a phenomena throughout the industrialized world, a little less so in Asia right now, particularly China. Japan's a separate story, South Korea a separate story. But this does seem to be a trend that took hold and actually really took hold during the pandemic.

What do you think?

DANIELLE MCLAUGHLIN, POLITICAL COMMENTATOR: Absolutely, Neil.

If you look at the data month by month that the CDC let us all see today, November and December, once actually people were thinking about conceiving in the pandemic year, are the lowest months.

So, plenty of children were born in 2020, but were conceived in 2019. So it's that end of year birth rate that I was really interested in. You're absolutely right. Birth rates are declining across the Western world, certainly in Western Europe and places like Japan, where they also have an aging population.

CAVUTO: Right.

MCLAUGHLIN: It's kind of an economic crisis, really, to put a finer point on it.

What's interesting is that, really, it comes down also to women having more economic opportunities, having more educational opportunities. And the data also shows that women are having children later in life and they're having fewer of them.

CAVUTO: I can certainly understand, Kat, when the whole pandemic started, not knowing that if, you were -- into March and April, when the shutdown began, nine months after that, maybe there isn't a reflection of the very, very latest data, which would show a pickup in activity when people were trapped in their homes and all that.

I don't even want to go there.

(LAUGHTER)

CAVUTO: But my point going there is that maybe this picked up in the last few months, and it's just not reflected in the data.

TIMPF: That's entirely possible.

But I also think, obviously, when it's something this traumatic, not just to us personally, but to a lot of our bank accounts, it's going to take some time before we even start thinking about adding another human in our lives.

(LAUGHTER)

CAVUTO: Yes.

GUNZELMAN: True. It's true.

CAVUTO: Well, Gunz, that was your view, right?

GUNZELMAN: Well, no, you're exactly...

CAVUTO: You just don't want any responsibility, right, Gunz? That's pretty much what it comes down to.

(LAUGHTER)

GUNZELMAN: Yes. I love taking care of myself. That's a full-time job on its own, you know what I mean?

CAVUTO: There you go. Absolutely.

GUNZELMAN: But I feel, Neil, though, that maybe we're here, spring fever, and things are going to reopen, and people are going to go wild.

And here in New York City, we're starting to see that. But the last year of our lives, we haven't been able to meet anybody else. Like, I'm tired like video chatting with somebody that like I don't really care about too much. You know what I mean?

So maybe we will see this start happening as time continues on. But you can't deny that it's expensive to have a kid in the world these days. And I'm not looking forward to that anytime soon. Keep me away. Keep me away, please.

CAVUTO: It's always -- Danielle, it's always been expensive. It's always been expensive. It's not cheap to have kids, right?

MCLAUGHLIN: Yes.

I'd be really actually more interested not only -- and what I'd love to see in the data is how many people, how many couples decided to have second children after being trapped in apartments with their children not going to school, having to work in their bedroom.

CAVUTO: Ah, very good point. Very good point.

MCLAUGHLIN: I'd be really interested to see that breakdown.

And the last thing I will say is, Kat, congratulations.

TIMPF: Thank you.

MCLAUGHLIN: And I'm really hoping that you will add to the birth rate. We're counting on you.

(LAUGHTER)

TIMPF: We will see.

(LAUGHTER)

CAVUTO: Absolutely.

Kat, very -- congratulations. The best days are ahead.

Gunz, I'm sorry to pass along the news, if you didn't know already. But, look, it's a wide and open field.

(LAUGHTER)

GUNZELMAN: Yes.

CAVUTO: All right, guys, thank you very, very much.

In the meantime, all sorts of things come to this news desk all the time, including one real happy bit of news.

(COMMERCIAL BREAK)

CAVUTO: All right, our parent company, and a media barometer, FOX is out with earnings that blew past estimates, 88 cents a share vs. 58 cents expected, revenue that also blew past estimates.

I was entirely the reason.

We will have more after this.

(COMMERCIAL BREAK)

CAVUTO: All right, Liz Cheney could be on the verge of losing her number three leadership post among House Republicans next week, and all because the president is not a fan.

The Wall Street Journal weighing in on all of that and making note, of course, of what's happened lately today, with Steve Scalise saying he thinks that Liz Cheney should go out of leadership here.

But what's interesting in this Wall Street Journal piece is that it says that the president has been the one to make this an issue that it shouldn't be, quoting here, that: "Even its President Biden proposes the largest expansion of government in decades, Mr. Trump is spending his energy settling scores in his own parties. He's thrown his loyal vice president over the side because Mike Pence refused to pull an unconstitutional stunt to invalidate the pro forma Electoral College count on January 6. As ever with Mr. Trump, everything is always about him."

The argument was, well, this fixation on Liz Cheney and whatever criticism she's had of the president and saying that the election was not a big lie, that the big lie is his complaining about that election, have ruffled feathers in the party and beyond.

Kim Strassel now, The Wall Street Journal editorial board member.

Kim, when you look at it, a lot of Republicans are getting nervous about this, those who will come on the record and talk about it, because they're concerned that this is getting more attention, at a time when the House is theirs for the taking, and maybe the Senate as well, and that this is a huge distraction.

What's the sense that you're getting?

KIM STRASSEL, FOX NEWS CONTRIBUTOR: Yes. And -- yes.

And if you talk to those members, there's a lot of criticism now to go around. A lot of them are very frustrated that the former president continues to go after individual members of the party and continues to essentially relitigate what happened last year, when everyone has such an enormous job ahead of them, which is keeping voters and the media focused on the Biden agenda.

On the other hand, you have seen a lot of rising discontent among members too about Liz Cheney herself. They had that vote back in February. They kept her in the leadership. That was about her impeachment vote and her right to speak her conscience and vote her conscience.

But they feel that they -- she needs to stop at this point, and that both sides are managing to elevate this, the back-and-forth between her and the president, and keep this in the media, when they would rather be looking at other things.

CAVUTO: I can understand the argument for both sides to stop. And you don't want to make this like a schoolyard fight, well, he started, she started.

But the fact of the matter was, after her February advance, to hold onto her position and all that, the president no fewer than some 27 times has targeted her and other Republicans, Mitch McConnell, and, of course, his vice president, relentlessly, Mitt Romney, and on and on.

And I guess they feel compelled to answer that. Is the message that Republicans are sending Liz Cheney, the president can say and rip anyone he wants; you, Liz Cheney, cannot?

STRASSEL: Well, the president is sending a very mixed message, because, on the one hand, he's going after all of these Republicans.

On the other hand, he keeps saying that his number one interest is in making sure that Republicans take back the House and the Senate during the midterms. And the reality is, you can't have both of those at the same time.

If you're going to engage in these fights, again, the headlines and all of the focus is going to be on what's already happened last year. It's not going to be on looking ahead. And you're not going to move on.

And so I don't think that this is necessarily the message to Liz Cheney, to answer your more specific question. There's a lot of frustration right now among members, members who support Liz Cheney's right to speak out, but who also think that it would be in the better interests of the party to answer these questions by saying, you know what the -- my view is, but, right now, I'm focused on the agenda.

CAVUTO: So, the president can rip and everyone has to cow to him.

I don't know. It's weird.

But, Kim, thank you very, very much, Kim Strassel on all of that.

By the way, a message from Facebook regarding the president. He is still banned. And in case you think it is hurting Facebook and its bottom line, think again.

(COMMERCIAL BREAK)

CAVUTO: All right, Facebook still suspending the former president of the United States, Donald Trump. They will revisit the issue, but maybe not for another few months.

Charlie Gasparino on the impact it's having on the company.

I think, since all of this first started, Facebook has been doing just fine, thank you, Charlie. What do you make of this?

CHARLIE GASPARINO, FOX NEWS SENIOR CORRESPONDENT: Year to date, stock is up, profits are up.

I think this is a longer-term problem for Facebook, though, and they're starting to push on Republicans in Congress in a big way. Here's -- again, short term, not a problem. Recent earnings were very good.

But you're getting Republicans in Congress who in the past said, OK, let's just suck it up for all these liberal woke companies, tech companies, and they're good for the economy. They're capitalists. Let's just forget about their -- even if they're giving support to the left.

And I don't think -- that is eroding right now. And here's the real problem that they have. If you get a Republican administration, if you get to Republicans in Congress and the House, you can really get a revoking of Section 230, their protection, which essentially allows them to put whatever they want on their Web site without legal consequences.

And if that happens, that stock will go -- will be cut in half. And that's, I think, the long-term problem that they have. They have so angered the Republican Party. I don't -- there is -- everybody in the party in leadership wants to basically make sure that Facebook, Amazon and all these woke tech companies, they get a pound of flesh out of them.

And if you don't have the Republicans protecting you, you definitely are never going to get Elizabeth Warren protecting you. You are screwed from a company standpoint. So, again, short term, not a problem, Neil, but long term, if they lose that Section 230 protection, which they really could, because the GOP is moving against them, they are in deep, deep trouble, and that stock gets cut in half.

I will point out one other thing. It's one thing to ban Donald Trump. And here's I think what a lot of Republicans, cons are -- can't believe. You ban him, but you don't ban the liberals and some of the leftists and some of the dictators on the left that say worse stuff.

CAVUTO: Right.

GASPARINO: I mean, it's -- and one other thing.

Go look at that panel that decides this, their sort of advisory board, whatever it is. It's very diverse, from, I would say, a racial and from a gender standpoint. It is not very diverse from a political standpoint.

It is -- so, I think I picked out one possible conservative who's on the -- at the Cato Institute on that board.

CAVUTO: All right.

GASPARINO: So, this has got Republicans smoking.

CAVUTO: Yes, we will see.

In a few months, they can readdress this, depending on how things are going. So, timing is everything.

But we will watch it, Charlie, very much, Charlie Gasparino following that development for us.

Also following a development with the first governor in the nation to say all these extra unemployment benefits that keep people collecting those benefits through September, he just put a stop to it.

Why he said thanks, but no thanks -- after this.

(COMMERCIAL BREAK)

CAVUTO: Thanks, but no thanks from Montana Governor Greg Gianforte, a Republican who was saying about all these extra federal benefits that extended and added to unemployment, state unemployment benefits, right through September, were preventing a lot of potential workers in his state from finding work.

So, he put an end to it, saying that right now it is far more important to get back to business.

Take a look.

(BEGIN VIDEOTAPE)

GOV. GREG GIANFORTE (R-MT): Montana is open for business.

We took action. When I got sworn in, in January, we meet lifted the impractical government mandates. We got rid of hours of operation, capacity limits. We got rid of our statewide mask mandate.

We put lawsuit protection in place for businesses and nonprofits. And now, as we have opened up, employers can't find workers. It's across all industries. Restaurants are having to shut down for days because they can't find cooks or waitstaff.

So, we made the decision yesterday these supplemental unemployment benefits, honestly, we got what we incented. We were incenting people not to work. So, we made the decision to opt out of the federal supplemental unemployment benefits, and replace it with a back-to-work bonus.

This is going to help employers. And, honestly, there's dignity in the work. And there's also satisfaction in being self-sufficient. We made that decision yesterday. And we're just getting a phenomenal response from our business community.

CAVUTO: So, you're offering up to $1,200 to anyone who gets a job and hangs on to it for four weeks. Do you think that will do the trick?

GIANFORTE: Well, I think it's directionally correct.

If someone was on unemployment -- we have about 25,000 people here in Montana on unemployment as of today. If they were on unemployment, all they have to do is go get a job. We know who's working. They will be notified. If they stay at work for four weeks, they get a $1,200 check.

And it also means that they get that check. They can't then refile for unemployment. So, this is a one-way ticket back into the job force.

CAVUTO: You know, Governor, I noticed you have a very low unemployment rate.

The most recent month I saw posted was a 3.8 percent unemployment rate. So, the timing of this is with a strong backdrop for the economy as well. Did that factor into the timing of this?

GIANFORTE: Well, most of what motivated this was just hearing from our small businesses. They can't open up. We have restaurants that are shutting down a couple days a week because they can't find staff.

We're coming into tourist season. Americans probably are not going to go to Europe this summer, but they're welcome to come to Montana, enjoy Glacier National Park, maybe get a line wet in one of our trout streams.

But if we don't have the waitstaff, hotel staff, cooks, carpenters, we're not going to be ready for all the visitors coming to Montana. This is about being array and getting all of Montana back to work.

CAVUTO: What has been the reaction from Washington, Governor, on this decision, the Labor Department or these other entities that were behind sort of shepherding this process, along with these extended benefits?

GIANFORTE: Well, there has been -- we have seen a continual stream of initiatives out of Washington that disincent work.

I think nobody starts life thinking, hoping they're going to grow up and become dependent on the government. We need unemployment as a safety net for folks that find themselves in a rough spot. But it shouldn't be a permanent status.

That's why we're doing away with these supplemental benefits. We're reinstituting work requirements. And we're putting this incentive to go back to work. I'm a free market guy. We should be incenting work, not sitting at home.

CAVUTO: I'm wondering too, with -- I think there were 14,000 open job positions in your state, by last count. So, obviously, employers have had a devil of a time trying to fill those slots.

But what if the math isn't based on the unemployment benefits that folks are receiving, but just not wanting to work at the positions that are available?

GIANFORTE: Well, you got to start someplace.

And we do have 14,000 jobs open in Montana that we know of, 25,000 people on unemployment. But it's a virtuous cycle. If a small business has two open positions, they hire those two spots, they can expand their hours of operation, the next thing they do is hire two more people.

So we have got to get our economy going again, and incenting work just make sense, instead of incenting people to stay home.

(END VIDEOTAPE)

CAVUTO: All right, Montana Governor Gianforte.

Now, there are a lot of small businesses and other businesses across the country that are welcoming a move such as this, because they are trying to get people to work for them. But the competition that you get with all of these extended unemployment benefits makes it mathematically prohibitive for anyone to leave home.

What if more do, because more governors do what this governor did?

After this.

(COMMERCIAL BREAK)

CAVUTO: It is very significant, what the Montana governor is doing, regardless of your politics, because he's saying he's encountering businesses in his state that are trying to hire folks, but those folks, with the extended jobless benefits, the extra $300 a week they're getting, on top of the roughly $582 Montana weekly jobless benefit, it's making it prohibited for businesses to top that.

So, removing the federal feature might allow that to happen. And this is a issue, as I say, that's being borne out across the country.

Jeff Flock has been in Philadelphia today talking to a lot of folks, businesses included, that feel this pressure right now -- Jeff.

JEFF FLOCK, FOX BUSINESS NETWORK CORRESPONDENT: Particularly restaurant businesses, Neil, that, well, they just are in such competition for these workers that they can't find.

But you talk about incentivizing work. If you can't find people willing to work for what you're paying, here's a crazy idea. You could pay them more. And that's just what this restaurant here behind me is doing. It's about an eight or nine restaurant group based in Philadelphia, and they have instituted a $15 minimum wage for all their employees, so essentially paying more then.

And maybe you see a lot of competition out here. This is 18th Street in Philadelphia, right across the street, restaurants, down the block, restaurants. They're competing for the same workers. They're now paying their workers more.

This is the called the Marquis Restaurant Group. And the question -- two questions. One, you're paying $15, maybe you have a better shot at keeping employees, but your costs go up, don't they? So do they get passed on along to the folks that want to eat the food at your restaurant?

Perhaps so. Maybe that adds to the inflationary -- inflationary spiral that maybe we're starting to see right now. But I would point out, again, if you can't find people that want to work for what you're paying, maybe you just pay them more -- Neil.

CAVUTO: You think about it, Jeff -- and I have crunched the numbers, certainly in the Montana case, that to keep up -- or for, let's say, a restaurant or a small business to hire these people, to woo them away from the equivalent of 21 bucks an hour that they make between the state unemployment compensation and the added federal benefit, that's a tough one for businesses to compete with.

Now, again, it depends on the locale. I get that. But I'm just wondering how, in the meantime, a lot of restaurants and others are dealing with this. They're always short-staffed, it seems.

FLOCK: Well, you know what? Some -- and not this -- I would point out to say not this restaurant, but I did talk to some others, and one in particular, who said, I have got people willing to work, but they want to work under the table. They want to be paid under the table, so that they can continue to collect those unemployment benefits, and also make some money at the restaurant.

So -- and the person that I talked to said, well I'm just not going to do that. I would subject myself to penalties and all sorts of problems. So -- but, apparently, they're -- you make a good point. There are folks out there that maybe would work otherwise, if it wasn't for the money that they're getting to stay home.

And then, of course, there are others -- and I point out, there are others who just say, I don't want to go back to food service. I'm dealing with people all the time. I'm concerned about my health. Maybe I don't -- until this virus totally gets beaten, I don't want to go back to work. That's the reason I'm staying home, not because I'm just lazy.

CAVUTO: Yes, and I hear a lot of that. It's a very demanding profession. It's -- we're still not out of the woods on this.

Jeff, great reporting, as always, my friend.

FLOCK: Sure.

CAVUTO: Jeff Flock following all of this in Philadelphia.

It's just a microcosm of what's happening across the country. And it is an issue that will be front and center on Capitol Hill as they continue to push these various spending packages that are getting a lot pricier.

Mike Emanuel on all of that in the nation's capital.

Mike, I just wonder. This is just another feature of good intentions possibly going bad or a little bit too good and a little bit too pricey. And now they're worried about, with the very strong economy, whether we need them as much.

How is that falling out on the Hill?

MIKE EMANUEL, FOX NEWS SENIOR POLITICAL CORRESPONDENT: Yes, you're absolutely right, Neil.

From talking with lawmakers on the Hill, they're obviously greatly concerned about constituents who are suffering through no fault of their own, who've lost benefits, who've lost salary over the past months due to the COVID lockdown.

But now that things are reopening, I have been interviewing people for small business segments in restaurants and other small businesses around the country who say, I'm having trouble finding workers. I'm having trouble staffing up for what we expect to be a busy summer tourist season.

And so the question Capitol Hill is, when do you cut off the funding? Right now, it's funded through Labor Day of this year, September the 6th, these enhanced unemployment benefits. And I bet there will be pressure from a lot of folks who are hearing from their constituents about the challenges of getting people to go back to work to taper that September 6.

But one thing our government struggles with is, once they start giving people stuff, they have a hard time taking it back, because that is quite unpopular with a lot of their constituents, AKA, voters.

And so there's the struggle for lawmakers, policy-makers in Washington. Once you give it out, it's tough to take it away -- Neil.

CAVUTO: And the reality is, is, the economy might not need the boost at all.

In fact, this might be compounding problems here. There's a great deal of talk about the total package of the president's initiatives now going from $6 trillion to $7 trillion, if you include all of his various programs.

And I know it's worrying a lot of Democrats, isn't it?

EMANUEL: No question about it.

They realize that, yes, they do have control of Washington at this point. But that could be short-lived. The margin in the House is very slim, a handful of seats, in the sense, a 50/50 Senate. So, 2022 could really change the dynamic of power here in Washington.

You could potentially be looking at a Republican Senate in 2023 and a Republican House dealing with President Biden. And so there's a school of thought that says, get as much across the finish line now, because you may not have an opportunity in 2023 going forward. But there are other folks who say, you might want to be careful, because the voters are going to have something to say come November 2022, Neil.

CAVUTO: Michael, thank you very much.

I guess there is logic to that. Strike while the iron is hot. We got the run of the table. Run the table.

Michael, thank you very, very much, Mike Emanuel in Washington.

A reminder, we're renewing something we had going for you earlier, letters, e-mails, comments, texts. They're all welcome. And we're all going to be featuring this on Friday, every Friday. We might extend this even beyond.

But you must be nice.

Like someone who wrote today: "Your obsession with Adele makes me uncomfortable. You could be her father."

(LAUGHTER)

CAVUTO: Yeah? Is there anything wrong with wishing her a happy birthday and my doing my British accent?

Happy 33rd, Adele, you rascal.

Here's "THE FIVE."

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