REWARD-00
President Obama to Deliver State of the Union Address Tonight; Protests in
the Streets of Germany; Wisconsin High School Students' Chants Banned as
Disrespectful; Biden Praises Sanders Stance on Income Inequality; Power
Ball Reaches Record - Part 1>
Pawlenty, Crystal Wright, Emily Tisch Sussman, Jillian Melchior, Gerri
Willis>
Refugees; Protests; Government; Policies; Elections; Politics; Lotteries;
Children; Discrimination>
DAVID ASMAN, FBN HOST: Risk and Reward starts now.
CHERYL CASONE, FBN HOST: And we begin tonight with breaking news. Two U.S. Navy boats have been detained by Iranian forces.
Welcome to Risk and Reward. I'm Cheryl Casone. I'm in for Deirdre Bolton tonight.
A senior military official confirming to Fox News up to 10 U.S. Navy sailors have been held back by the Iranian Revolutionary Guard after at least one vessel they were in became disabled and drifted into Iranian territorial waters.
To Fox Business' Blake Burman with the very latest from Washington. Blake.
BLAKE BURMAN, FOX NEWS CORRESPONDENT: Hi there, Cheryl. A lot coming in here. Here's what we can tell you at the moment. Ten navy crew members aboard two ships are now in control of Iranian authority. The senior defense official tells Fox that group was headed from Kuwait to Bahrain earlier today, when the U.S. navy lost contact.
The official says it does appear that the ships went into Iranian waters. Now, those sailors are now being held on Farsi Island, which is in the middle of the Persian Gulf.
A senior administration official says they have been in communication with Iranian authorities. That official says they were told the sailors will be allowed to continue on and that was described as promptly.
We're also told that Secretary of State John Kerry has been in touch with his Iranian counterpart on the matter. That of course, would be Mohammad Javad Zarif, who, of course, carried and negotiated the nuclear deal with. Cheryl.
CASONE: All right. Blake Burman, out of Washington. Thank you, Blake. And I want all of you know that coming up, retired lieutenant colonel Ralph Peters will be weighing in on this developing situation. We'll bring you any breaking news out of Iran as we get it here at Fox Business.
Well, we're not sure if our Iran deal will be addressed at tonight's State of the Union. But the administration clean energy push will. This, after U.S. oil prices plunged again today. Even touching below 30 bucks a barrel for the first time in 12 years.
A new report saying as many as 30 small oil companies may have already filed for bankruptcy. And many more companies could follow. But first, let's get to today's continued plunge and how it could affect future gasoline prices.
I want to bring in Fox Business' Gerri Willis. Gerri, good evening.
GERRI WILLIS, FOX BUSINESS REPORTER: Hi, good evening, Cheryl. That's right. You've got the numbers all correct. Oil falling below $30 a barrel today, to actually 29.93. It closed higher than 30 but just barely. This is the first time in 12 years since 2003, that oil prices have been this low. And for people like you and I who cover this thing it's astonishing to what's happened.
Fully a third of U.S. oil and gas companies expected to go into bankruptcy as a result of this because these companies are losing $2 billion a week. And as you know, Cheryl, BP, British Petroleum, laying off 4,000 people today.
Now, I want to tell you Morgan Stanley and Goldman Sachs, Citigroup, all predicting that it's not going to be a brief touch below 30 that oil is going to actually trade below 30 for some time to come.
I also want to report to you Arch Coal, which is the second biggest coal company in the country filing bankruptcy as well. The reason since are a little different here as you know the EPA, the U.S. government actually going after coal, trying to get companies across the country who produce electricity for consumers. Not to use coal to use natural gas - that policy decision, that administrative fiat, if you will, means that coal companies are having a heck of a time making money.
They're losing billions and billions of dollars, and let's not forget lots of people losing their jobs in both oil and gas and coal mining. The situation is dire in areas where this is being done. Which is often, by the way, remote and people don't have other options.
CASONE: Right.
WILLIS: But lots of changes on site here for oil and gas, for coal.
CASONE: Right.
WILLIS: Big changes in those industries. Cheryl, back to you.
CASONE: Well, Gerri, stay with me. Because here's the thing. Oil company billionaire and CEO, Harold Hamm was with Neil Cavuto today, and he was commenting on those companies and jobs being lost. Listen to this.
(BEGIN VIDEO CLIP)
HAROLD HAMM, CONTINENTAL RESOURCES CEO: We're down to the lowest rig count since 1999. We've lost a quarter of a million people. Direct jobs about three times that many indirect jobs.
(END VIDEO CLIP)
CASONE: So, Gerri, it's about jobs. Will oil companies continue to suffer. Does this mean more job losses do you think?
WILLIS: I absolutely believe that, Cheryl. And let's face it, when you look at what's being called the recovery in the wake of the great recession, what happened was with people have really being hired has been in the energy field, it's been in oil and gas, it's been in fracking that has really resurrected this economy.
And when you take it out of the mix, it makes employment look worse. I think we might be in for a situation in this first quarter of the year where we see those jobless rates tick higher.
CASONE: You know, Gerri, it's interesting. You mentioned that fact that you and I have covered this for many years and this is very true. You know, but how is this downturn different from previous oil price crashes? I mean, we've seen 20 bucks before, but how is it different this time do you think?
WILLIS: I think it's very different this time around and here's why. Because we have such an abundance of oil out there right now, such an abundance of natural gas, our markets are chunk of blocks full of this, and for reasons that are different, we're mining more, we're extracting more, we're using different technology to do it.
It is a huge turn in the market that was predicted by virtually nobody. Nobody said this was going to happen to oil prices. Nobody saw it coming.
CASONE: Yes.
WILLIS: So, everybody is unprepared. And frankly, a lot of the executives don't even know what to do. They're desperately trying to reposition their assets, they're trying to decide what is the right strategy going forward.
CASONE: Right. Gerri Willis from Fox Business. Gerri, thank you very much this evening. I appreciate all of your great reporting.
WILLIS: Thank you.
CASONE: Well, energy companies heading down, could mean that your energy prices shooting straight up. Now to an energy CEO who has warned us about this before.
All right. Joining me now on the phone is founder and CEO of Murray Energy himself, Bob Murray who was in that clip that we may be able to get back but let's bring in Bob live via phone. OK. I want to talk to you about coal, Bob, and good evening.
BOB MURRAY, MURRAY ENERGY FOUNDER & CEO: Good afternoon, Cheryl.
CASONE: Yes. Coal companies provides 39 percent of the nation's electricity. Do you think that prices are going to go up with less coal producing less energy? Now, especially that we were five years ago?
MURRAY: Absolutely. No question about it. Obama's clean power plant is going to cost $214 billion to the economy the wholesale power. According to Energy Ventures that now says is 31 percent increase for 50 of the states. Coal is 4 cents a kilowatt hour at the buzz bar, wind and solar at 22 cents a kilowatt hour with a tax.
Of course they're going to go up. They are going to skyrocket which he said when he is running for president, they would. He has destroyed the American power grid. It's not only a case of cost, Cheryl, it's also reliability. He has destroyed the reliability of the American power grid.
CASONE: Well, you know, it's interesting because of course, the president is going to be talking about clean energy tonight, but coal stocks under the president have not done well. Walter Energy, out the natural resources already filing for bankruptcy. Every move toward tonight, do you think that President Obama's clean energy policies destroyed the coal industry? And do you think that we could get more casualties in the industry?
MURRAY: Yes, ma'am, I do. There are 49 bankruptcies, ma'am, is the number as of today. And with Mr. Obama's pension to be both just -- and refuse to mention the cost of what he's attempting to do with his climate change agenda, let alone the less fortunate citizens of America.
This thing is going to be a spectacle. And the man is not going to tell the truth. What he needs to say if we -- the true cost of what he is doing for no environmental benefit at all. Yes, he's driven 49 coal companies into bankruptcy already.
CASONE: Well, he's not going to talk about that tonight, you can be sure, sir. But I want you to take a listen to what J.P. Morgan CEO, Jamie Dimon, had to say to our very own Maria Bartiromo this morning about oil prices. Listen to this.
(BEGIN VIDEO CLIP)
JAMIE DIMON, J.P. MORGAN CHASE CEO: I think we told the world that if oil goes to $3 and stays there for 18 months, it would cause us to increase reserves by something, like, $500 million, you know, which is -- which is fine. We're still going to help our companies to get -- these companies to get through it.
(END VIDEO CLIP)
CASONE: Do you agree with that, Bob?
MURRAY: Yes. I think he's correct. But we have a very small oil and gas company. I'm not an expert on oil and gas as I am on electricity and on coal. But I know the country's in for a shock here. And it's the poor people, it's the people on fixed income, it's the people wanting to manufacture a product for the global marketplace, they're going to see the electric grids and all of their fuel costs skyrocket as a result of these bankruptcies that Obama has caused.
CASONE: Right.
MURRAY: And it was the fossil fuel industry that has supported since eight years. We would have had a terrible recession in this country if it hadn't it been for the growth of fossil fuel.
CASONE: You know, Bob, I just want to tell you...
(CROSSTALK)
MURRAY: And how he is destroying that.
CASONE: ... we're out of time, Bob, and I had to say that I want to leave it with this. Ten years ago, 50 percent of the energy in this country was coal, but because of the president's policies we're now down to just over 30 percent and that may actually fall.
That's going to be a shock to every consumer out there. I hope they're thinking about that tonight when they listen to the president. Bob Murray, Murray Energy founder and CEO. Bob, thank you very much for the commentary tonight.
MURRAY: Thank you, Cheryl.
CASONE: Well, Fox Business' State of the Union coverage begins tonight at 8 p.m. Eastern Time. Neil Cavuto will have reaction from Ben Carson, Montel Williams, and Senator Scott Brown. All of that tonight right here on the Fox Business Network.
So, remember what the administration suggested that we fight terrorist with job creation?
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: We can work with countries around the world to help improve their governance. We can help them build their economy so they can have job opportunities for these people.
(END VIDEO CLIP)
CASONE: Well, maybe they were onto something because an ISIS terrorist reportedly set up a profile on LinkedIn to give jobs to more terrorists.
We're going to have the details coming up for you.
Also, a presidential double down. Forget contained, President Obama is now saying that it will have ISIS defeated, which has my next guest retired colonel Ralph Peters shaking his head. More after this.
(BEGIN VIDEO CLIP)
BARACK OBAMA, UNITED STATES OF AMERICA PRESIDENT: Our goal has been first to contain, and we have contained them.
(END VIDEO CLIP)
(COMMERCIAL BREAK)
CASONE: I want to bring you updates if you're just joining us. Breaking news, 10 U.S. Navy sailors had been detained by Iran after a vessel they were in drifted into Iran -- Iranian territorial waters.
Retired lieutenant colonel Peter Ralph joins -- Ralph Peters joins me now. You know, when I saw this breaking news, Colonel, the first thing I thought it's the State of the Union. Do you think that Iran is trying to provoke the president ahead of his speech tonight to the nation?
RALPH PETERS, FOX NEWS STRATEGIC ANALYST: I think they were very, very glad to have the opportunity to humiliate the president once again just before the State of the Union address.
Now, there are so many holes in this story, yet, we don't really know what happened. But we do know a couple of things. One, this was not some local Iranian commander going wild. In the Iranian system, this seizure had to be authorized from the top.
Two, it's a hostile action. Because, you know, under the Law of the Sea and peace time if a vessel or a boat is disabled, any vessel that comes upon it is obliged to take help not take prisoners. The third thing is if the U.S. -- the Pentagon is just saying we lost contact to their boats.
Well, if the Iran -- if they weren't able to issue a distress call, that means the Iranians were jamming our communications, that's a hostile act, and not least. Once they were taken captive, they were obviously not allowed to communicate their status. That is a -- all of these are hostile act.
And I think that coming upon the recent firing -- Iranian firing of rockets near our carrier the USS Harry Truman with no U.S. reaction, that the Iranians continue to push the envelope and, again, was the timing coincidental? Maybe.
CASONE: They're testing us.
PETERS: But the Iranians are relishing us.
CASONE: They are testing us. There is some other breaking news that I want to bring to your attention tonight, Colonel Peters. The House has just has the bill that impose sanctions on North Korea after last week's weapons tests.
Again, whether they were provoking Japan or trying to provoke the United States, we don't know. But what do you make of this -- of this move by the House in Washington tonight to impose these sanctions?
PETERS: Well, it's a nice gesture but that's all it is. Any sanction we impose are not going to make any difference unless China, which is the only country that has real influence in North Korea and even that's limited. Unless China gets serious about reigning in North Korea, we will not see a substantial change, and we will on the contrary, see every more dangerous increasingly dangerous provocation.
But right now, although the president is going to battle and pat himself on the back again on international security issues tonight in his fantasy world. Nonetheless, we are living in a world that grows more dangerous by the day because everybody knows they can back down this president.
CASONE: OK. You brought it up. OK, so, fine. So, the president did lay out the ground work for his foreign policy plan at last year's State of the Union address. Listen to this. I want to get your reaction.
(BEGIN VIDEO CLIP)
OBAMA: Tonight, we turn the page. Tonight, for the first time since 9/11, our combat mission in Afghanistan is over in Iraq and Syria. American leadership, including our military power is stopping ISIL's advance. Instead of getting dragged into another ground war into the Middle East, we are leading a broad coalition, including Arab nations to degrade and ultimately, destroy this terrorist group.
(END VIDEO CLIP)
CASONE: We're leading, we're leading against the fight with ISIS. Are we - - are there now? It's a year later.
PETERS: Cheryl, one year later, Cheryl, Afghanistan is much worse off. Iraq is deeply in trouble and owned by Iran. Syria is in horrific shape. Libya is in worse shape. The entire Middle East is going up in flames. As you heard Mike Moral, the acting -- former acting CIA director say today, Islamic state is expanding more rapidly than Al Qaeda every bit as now in almost 20 countries, even Europe is under -- is undergoing turmoil because of the Middle Eastern situation.
We just talked about North Korea. China is feeling itself in the South China Sea. This president's with calls of it -- his unwillingness to do anything that is meaningful and forceful has put our country in grave danger, our allies in grave danger. Not only today, but this danger from Islamic extremist and others is going to -- it's going to punish us for decades.
CASONE: As Angela Merkel how she feels about extremist today.
PETERS: Yes.
CASONE: She may have a very, very different story, Colonel Peters.
PETERS: Indeed.
CASONE: Thank you very much, sir, for being with us tonight. We appreciate it.
PETERS: Thank you, Cheryl.
CASONE: Well, Fox Business State of the Union coverage does begin, 8 p.m. Eastern Time, Neil Cavuto is going to be hosting his show, obviously. He's going to have reaction from Ben Carson, Montel Williams, and Scott Brown. And he is already on the ground we should say in South Carolina. That is Neil Cavuto coast to coast for us tonight.
Well, a crisis is getting out of control. I just mentioned as Germany's refugee protest breaking out overnight.
(BEGIN VIDEO CLIP)
(CROWD CHANTING)
(END VIDEO CLIP)
CASONE: Over 200 arrests as angry Germans take to the streets crying out over a growing number of refugee sexual assault. Coming up, a U.S. governor who says this could be our future.
Plus, the president not yet ready to blame his executive orders for creating Donald Trump's anti-government support. Hear an interview that got heated after this.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Do you feel you're responsible for a certain hunger out there that a message that Donald Trump is putting out there.
OBAMA: Well, talk to me if he wins. Then we'll have a conversation about how responsible I feel about it.
(END VIDEO CLIP)
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
(CROWD CHANTING)
(END VIDEO CLIP)
CASONE: Protesters taking to the streets in Germany breaking windows, vandalizing buildings. The protests were started by now over 600 criminal complaints against refugees for New Year's Eve refugee assaults.
Our concerned Governor, Asa Hutchinson, on whether this could come to this country. Could this happen here?
ASA HUTCHINSON, ARKANSAS STATE GOVERNOR: Well, it emphasizes the point that the chief responsibility of the leader of the state or the government is to protect its citizens. And that's what they want to have assurance of in Germany, and Merkel has been a great ally of the United States. Germany has consistently stood with us, but...
(CROSSTALK)
CASONE: But does this hurt her? Does this hurt her?
HUTCHINSON: Well, I think that...
CASONE: She's the one that said a million refugees. A million into that country.
HUTCHINSON: Right, and so, you see her attacking back and saying we're going to take more security measures put it in place. She's got to gain the confidence of the German people that they're going to be safe.
CASONE: All right.
HUTCHINSON: That's the chief's responsibility.
CASONE: Well, certainly, you know, there's many here in this country that are concerned about what we're seeing in Germany. As the former deputy Secretary of Homeland Security, I'm curious what you think about Alabama Governor, Robert Bentley, suing the federal government over the refugee program here. Do you support that?
HUTCHINSON: Well, as Governor of Arkansas, I've expressed my concern about Syrian refugees.
CASONE: But would you sue?
HUTCHINSON: No. I haven't sued, and I don't intend to sue.
CASONE: OK.
HUTCHINSON: What I've done is to ask President Obama to communicate more directly with the States as to what's happening. And to make sure that the Secretary of Homeland Security, the FBI director, sign off and certify that the security measures are in place.
I know that it takes intelligence information to know whether refugee or any other visa holder is going to come to the United States and pose a risk to us. We've got to do a better job of vetting those.
Again, I think that whenever you look at refugees, we handle refugees in Central America.
CASONE: Right. That's where the real crisis is. Maybe it could be argued as the bigger crisis that's in another place.
HUTCHINSON: Well, we don't asking Europe to help us here. We want to support Europe but we don't want refugees from Syria being transported across the Atlantic here in the United States not geographically close. We want to support them in that effort, but we want to make sure the security is in place.
CASONE: Sure.
HUTCHINSON: And that we're protecting our citizens.
CASONE: OK. I want to move on to something else. As a former federal prosecutor and of course you were -- of course head of the DEA at one point. I have to ask you about El Chapo.
Sean Penn, this actor, his involvement with him. There's a lot of talk that he should be investigated. He should at least be talked to by the DEA and potentially prosecuted. Do you see that happening to Sean Penn?
HUTCHINSON: I'm not aware of any law that he broke.
CASONE: OK.
HUTCHINSON: But he is obviously ought to be prosecuted, but I'm not aware of any law he broke. But what he did, though, was to disrespect law enforcement and disrespect all the victims of the crimes of El Chapo. And so, that's my problem, and I don't think he should have been there. I don't think he ought to be working with a movie production or interviews with somebody who is a notorious escapee that has disregarded both Mexican and U.S. law enforcement.
It is a good sign that he is captured. He need -- El Chapo needs to be extradited to the United States of America.
CASONE: And we're working on that right now. Would you've done anything different with regards to El Chapo if you had been running the DEA at the time? And I got to, obviously you were when he was a threat. But he has become -- I mean, one of the -- probably the biggest drug lord in the world, the most dangerous in the world now.
HUTCHINSON: Absolutely, and I would not second-guess the law enforcement how they handled that. I applaud the new level of cooperation between Mexico and the United States.
DEA agents now can better protect themselves. Better carry out their mission in Mexico. Share intelligence, that's a cooperation we need because this is definitely a United States challenge and Mexican challenge that we need to work together on.
CASONE: We need to put him in a U.S. jail so he doesn't build another tunnel and escape like he did in Mexico.
HUTCHINSON: I agree.
CASONE: Governor, it was great to see you, sir.
HUTCHINSON: Thank you. Good to be with you.
CASONE: Thank you very much for your time. Tonight, we want to let you know of course, that Neil Cavuto, he is a busy guy because he is going to have special coverage tonight of the State of the Union coming up.
Former governor and presidential candidate Lindsey is going to join me on some difference that he sees between the president's first State of the Union speech and his last.
(COMMERCIAL BREAK)
CASONE: Tonight is President Obama's last state of the union address. So why not take a look back at his first, see how the President's predictions panned out. Here to help me Former Minnesota Governor and former Republican Presidential candidate Tim Pawlenty, Governor, good evening.
TIM PAWLENTY, FORMER MINNESOTA GOVERNOR: Good evening.
CASONE: I want to get right to it. I want you to take a listen to President Obama in 2009. This is his first state of the union talking about the economy. Roll tape.
(BEGIN VIDEO CLIP)
BARACK OBAMA, U.S. PRESIDENT: While our economy may be weakened and our confidence shaken, but we are living through difficult and uncertain times. Tonight, I want every American to know this. We will rebuild. We will recover and the United States of America will emerge stronger than before.
(END VIDEO CLIP)
CASONE: Ok, well, turn to today, the labor participation rate has declined since 2009 and a number of people on food stamps has actually risen, Governor. Do you think he has turned the economy around?
PAWLENTY: Well, if you look at the headline number for economic recovery, namely the GDP number, it has increased. But let's be candid. It's increased at a very slow anemic level, and if you look at workforce participation rate, household incomes, and other measures, you have to say the economy has not been fundamentally turned around. There has been very slow anemic progress.
CASONE: Ok, well I do want to move on because here's the President on combating terror at his first state of the union in 2009. He says that he would have defeated Al Qaeda. Listen to this.
(BEGIN VIDEO CLIP)
OBAMA: And with our friends and allies, we will forge a new and comprehensive strategy for Afghanistan and Pakistan to defeat Al Qaeda and combat extremism, because I will not allow terrorists to plot against the American people from safe havens halfway around the world. We will not allow it.
(END VIDEO CLIP)
CASONE: Well, the latest Fox poll says a majority of Americans that he has failed on making the country safer, 34 percent says he mostly succeeded, 58 percent, Governor, say he mostly failed. Did he?
PAWLENTY: Yeah. And you look at his own words I think one of the operative phrases in that clip you played is this, that he will not allow terrorists to have safe havens halfway around the world. Well, in fact, until recently ISIS controlled Ramadi, they still control Mosul, they still control significant parts of Iraq, and they control significant parts of Syria including the city of Raqqa. So the idea that he somehow eradicated save havens have not materialized, he has failed to defeat them and he's particularly failed to eradicate their safe havens.
CASONE: Well, and you know in his 2009 address, Governor, President Obama struck a very optimistic tone about the economy and the future. Take a listen to this.
(BEGIN VIDEO CLIP)
OBAMA: If we confront without fear, the challenges of our time and summon that enduring spirit of America that does not quit. Then some day years from now our children can tell their children that this was the time when we performed in the words that are carved into this very chamber something worthy to be remembered.
(END VIDEO CLIP)
CASONE: Ok, well, performed is the word that's just used. Another majority of Americans is completely on the wrong track, 24 percent saying wrong direction, 68 percent completely on the wrong track. Americans have lost faith in general. Does this President take the blame for that tonight, Governor?
PAWLENTY: Well, I think these times will be remembered. Unfortunately, they're going to be remembered for things that are not particularly positive. They're going to be remembered as a time where America flinched on the international stage as it related to security threats, as the time when we capitulated with respect to the Iranian nuclear agreement, when we had anemic economic recovery, and now may be headed back to more trouble times in that regard. People are unsettled and the figures that you posted there show concern and that the country is on a wrong track for a reason because it is.
