Larry Kudlow on U.N. climate change report: 'I don't think we should panic'

National Economic Council Director Larry Kudlow is interviewed by George Stephanopoulos on "This Week."
9:04 | 10/14/18

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Transcript for Larry Kudlow on U.N. climate change report: 'I don't think we should panic'
pressure to deal with the disappearance of journalist Jamal khashoggi. Suspected of being murdered under the orders of the Saudi Arabia government. We want to bring in Larry kudlow director of the economic council. We just heard the president say that Saudi Arabia should face severe punishment if it's shown they're behind the disappearance of Jamal khashoggi. Ruling out taking away the arm's sales, what sanctions are being considered? George, I don't want to get too deep into it. I don't want to get ahead of the president on this. All I would say is with respect to the khashoggi story which is a tragedy for khashoggi among other people, believe what the president says when he says we'll take very tough action if the allegations of Saudi interference prove to be the case. There's a -- Is there any other explanation? I don't want to go into those details. Beg your bard -- pardon? Is there any other explanation for the disappearance really? Look, I'm not an expert on these things. I don't know if anybody knows. At this point the president called for a swift and transparent investigation. I think he's talking about this week in particular. We'll see what that brings. Your colleague, treasury secretary, Steve mnuchin, is under some pressure as well heading to the investor conference. Many CEOs are pulling out of the investor conference. Is it appropriate for him to go? It's actually a conference about terrorist financing and how to stop it. It's an important subject. Regarding secretary mnuchin he's intending to go because of the importance of the issue of ending terrorist financing. Along with the president and the general investigation, Mr. Mnuchin will make up his mind as the week progresses and as new information emerges. We had a rocky week in the stock market. That caused the president on Thursday to talk about the fed. He didn't seem too happy about the fed. The problem that I have is with the fed. The fed is going wild. I mean, I don't know what their problem is, but they're raising interest rates and it's ridiculous. The fed is going loco. No reason for them to do it. I'm not happy about it. The president said he's not happy about it. He also said the fed is out of control. Fed is out of control. What's he going to do about it? Well I don't -- look, he's expressing his opinion, George. He's a successful businessman and investor. He's raising an important topic. A lot of people on Wall Street and academia and the press are talking about interest rates and whether it will impact the economy. It's a legitimate subject. Do you believe the fed is out of control? Look, I don't personally and the president respects the Independence of the fed. Let me make that very clear. He's said as much during these comments. He's not telling them or mandating them to change their strategy. He's not telling them to change their policy. He's raising an important issue which everybody else is raising. I do think -- I want to say this pretty much everybody believes we want this economic boom which no one expected -- we want this boom to continue. Everybody believes that. The fed believes that. The president believes that. Investors, business men and women all believe that. We're running for the same objective. There are issues and discussions within that. The president, again, has never interfered with fed Independence. What is the biggest threat to that continued economic growth? A lot of people have been citing the president's views on tariffs especially with the Chinese as something that could stall the economic momentum. I think the trade issue -- let me add one point. The biggest threat to this economic boom which is in my opinion is going to go on several more years is efforts by the congress to overturn it. That's an election year theme. We do not want to overturn the reduction in tax rates. For individuals and small businesses and so forth. We do not want to overturn all the across the board deregulation which has unlocked and released the animal spirit. The new trump economy is about blue collar workers. It's also about men and women who own small businesses. The president has ended the war against business success. My biggest concern is that political issues could overturn these pro-growth measures. That to me is the biggest issue. One of the things you predict -- you talked about the pro-growth measures. You predicted before the tax cut that the deficit would go down. In fact the deficit has been going up. Our debt is higher than ever. We just got the new numbers on the deficit for 2018. They came in at $100 billion below estimate. It's still climbing. It was about 3.9% of gdp which is manageable. Look, short run, they're going to be some deficit issues. Median term, faster economic growth which would bring in more people working, more revenues, faster economic growth. That's going to really lower the budget deficit and its burden on the economy. That's absolutely the key point. I want to talk about climate change. We saw the new report from the U.N. Saying if action isn't taken now, you'll have irreversible damage much sooner. It comes against the backdrop of the horrific hurricane, hurricane Michael. You can't tie any single event of weather to climate change. It's increasing the probability of more intense events. Warmer weather leads to these events. Is the president going to do anything about it? We're always studying these things. Bill Morehouse won a noble prize on his own economic work with respect to climate change. I respect that. He's a brilliant guy. The issue here is magnitude and timing. Personally I think the U.N. Study is over -- way, way, two difficult. I won't say it's a scare tactic. I think they overestimate. The models have not been successful in the last 20 years. We have to be cognizant of the work that needs done. I'm not denying any climate change issues. I'm saying do we know precisely I mean worth modelling how much is man made, how much is solar, how much is ocean, how much of it is rain forest and other issues? We're exploring all that. I don't think we should panic. There's no eminent catastrophe coming. I think we should look at this in a level headed way. "The New York Times" is reporting that Jared Kushner likely paid no income tax from 2009 to 2016 despite real estate profits that fueled a net worth of $300 million. That comes on the heels of "The New York Times" report that shows how the president's family -- his father shielded his estate from taxes, fueled president trump's fortune, including they say through out right deception and possible fraud. Do Americans have a right to be concerned that president trump and his family are gaming the system for their benefit? The most recent "New York Times" column about Jared Kushner -- who by the way is a brilliant guy and has enormous integrity. That story said he didn't break any laws. He's a successful businessman. There's no law against that. Americans respect success. I don't think these stories don't have anything to them. I thought the president trump story was full of holes and hot air and whatnot. Playing by the rules is a good thing, not a bad thing. Both gentlemen have done so. In the Jared Kushner story, "The times" said he's done nothing wrong at any time. Larry kudlow thank you for your time. Thank you, George.

This transcript has been automatically generated and may not be 100% accurate.

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