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CAVUTO: She is a conservative dream thus far — and, boy, doesn’t Rush Limbaugh know it. Now he has been talking up the Alaskan governor for some time now. In Rush’s words, and I quote, ‘Babies. Guns. Jesus. Hot damn!’ I spoke to the radio talk show host just moments ago.

RUSH: She has turned the election upside-down, Neil. She has united a convention. She has united the Republican base. The Republican base, conservative base is more excited and happier than it has been in 14 years, since the Republican victory taking back the House of Representatives in 1993 and 1994. I mean, this is…. I’m calling Senator McCain ‘Senator McBrilliant’ lately, Neil. This was just a brilliant and gutsy choice, and it’s very typical of his fearless approach to things, and it’s a testament to his character.

CAVUTO: All right. Now the question is whether people will rally beyond just the typical Republican base or the conservative base. What do you think?

RUSH: I think Obama and Joe Biden have lots to fear today and they know it, because the answer to your question is her appeal is so broad through all of America. This is an ordinary woman, this is a woman who has not had any help getting where she has arrived. She is authentic. She has a life story that is a rich American life story with hundreds of people to vouch for it, something Obama does not have. He doesn’t have a group of people to speak for his life — that he wants us to hear about. She is, I think, like people we know. We all have known women and mothers like this in our neighborhoods and in our towns. She fights back. They have attacked her kids. They have attacked her. They’re trying to make her look like she’s trailer trash with that Us Weekly cover, and she’s fighting back. I’ll tell you, the last two nights of this convention have just been perfect. They have been flawless; and I hope tonight that the theme continues. I really hope that Senator McCain tonight can set aside just for one night his stump speech remarks about how well he works with Democrats, ’cause right now we want to beat Democrats. I’d love for him to say something like, ‘And, by the way, I’m looking forward to working with Democrats in November — those that are left, anyway.’

CAVUTO: (chuckles)

RUSH: Keep this momentum going, ’cause I guarantee you, this was totally unexpected by both sides, and it’s just tremendous.

CAVUTO: You know, when you actually read her speech, though, Rush, it’s very populist. It sounds, in a lot of ways very Democrat, when it comes to bashing the oil companies. Of course, she’s had this love-hate relationship with the oil companies in Alaska. She allows them to drill more, but she wants to extract more money from them for that, which is probably good business sense. But there is definitely something populist in reaching out to Democrats and union members with that pitch, that populist pitch that John McCain echoes. So it’s a slippery slope, is it not?

RUSH: Well, it’s not a slippery slope, but you’re very shrewd, Neil, because she does have a lot of populism in her. And with gasoline prices the way they are now, fluctuating and so forth, it’s a big economic concern for people, and I think it’s a smart play. You know, what I look at in a candidate like this is we know we’re not going to get down-the-line perfection. We know we’re not going to get somebody that doesn’t fall off the so-called list, litmus test requirements for somebody being conservative. It’s her character; it is her presence. She’s a natural at this. She’s a genuine, authentic woman who just, I think, sends fear into the entire opposition. Remember, now, Neil, in attacking her the Democrats really do not want to go anywhere near the arena of ideas because they try to hide their ideas from people, mask them with their own version of populism and pandering. So their only recourse is to try to take people out. You know, Obama is from Chicago ‘thug politics,’ as Bill Clinton said, and their theory in Chicago is: You clear the playing field; you don’t level it. And so the idea is going to be: Take her out. I actually think, Neil — I’m going to make a prediction to you — before this is all said and done, it will be the Obama camp looking for a reason to replace Biden with Hillary Clinton or somebody similar.

CAVUTO: Hmm! Well, let me ask you. You were one of the early urgers, if you will, to tell Republicans, ‘Get off defense. Be on offense,’ and early on — I think before anybody, Rush — you were saying, ‘This gas issue, this energy issue is a signature Republican issue.’ Now that oil prices and gas prices are declining; ironically, do you think that they’re hurt? In other words, Republicans are hurt by that?

RUSH: No, I don’t. Because they’re still way higher than they were on a percentage basis just a short time ago, and they could very easily go back up with one comment from Mahmoud Ahmadinejad or one move by the Russians, Putin. I think the American people understand here that the problem is that we are not as self-sufficient in energy resources as we should be, regardless what the price is, because there’s always the future. We’re smart enough to figure out that we’re a growing economy, and so is the world, and it’s going to be using more energy. Conservation and tire gauges and properly inflated tires are not a substitute for growth in energy resources. And they know that we’ve got a tremendous amount of resources that we’re not exploiting, and there’s one party standing in the way of it, and that’s the Democrat Party. And I’ll tell you why: for purposes of winning elections, Neil, they want as much suffering — economic suffering and misery and anger — as they can muster, and then they want to steer that anger toward Republicans and George W. Bush. So, all this talk about how they’re really sorry that the American people are suffering at the pump? They secretly like it.

CAVUTO: Could I ask you just a curious question I’ve always wondered about. Knowing of your past — and you’ve said it on the air — tense relationship with John McCain, have you two talked directly since? In other words, when it looked like he had the nomination and everything was solidifying around him, I know you rallied around him. There were other conservatives who did not. You chose to rally around him, and that brought other conservatives along the line. But have you two talked?

RUSH: No.

CAVUTO: Have you two discussed things?

RUSH: No.

CAVUTO: Does he call you? Do you him?

RUSH: He hasn’t called, and I haven’t called. I don’t think it’s necessary. But I would. I mean, I would love to have the opportunity to personally pass along my hopes for what happens at the convention tonight, but I’m not presumptuous enough to do that. It’s their show, and I can sit here and hope as an analyst or pundit that they do it the way I would do it. But I just came to the conclusion that this country, in two ways, cannot afford Barack Obama. We can’t afford Obama economically, and we can’t afford what Obama represents in terms of a desire to redefine what Americanism is. This is another great value of Sarah Palin, by the way. This is a battle, this election. You know, a presidential election is the closest thing we get to a national referendum on the future of the country, and the forces in opposition to each other here are the people who want to defend Americanism as defined by our founding — with the foundation being freedom and individual liberty — versus forces that want to redefine Americanism as built around an ever-growing state that takes care of more and more dependent people because the people that run the state don’t think people are capable of handling their own problems. This is another way that Sarah Palin just nails the liberal philosophy of life. It’s all great, Neil. It is all great. We’re jazzed here. We really are.

CAVUTO: All right. This is an issue I want you to be jazzed about as I leave you, Rush. Would you be open, hypothetically, to let’s say a prominent financial TV anchor who works at Fox investing your hundreds of millions that are part of your deal now and getting back to you in thirty years?

RUSH: (laughing) Neil, I have so much trust in you because you —

CAVUTO: (laughing)

RUSH: Well, you’ve done it. You’ve demonstrated it. You know it. By the way, your — and I don’t want to embarrass you here, but I watch your show. Your commentaries at the end of your program are right on the money. You’re a real treasure. They’ve got a real find in you. I’d be happy to invest and give you everything I’ve got. I’d come back to you in ten years not thirty. (laughing)

CAVUTO: (laughing)

RUSH: But, sure.

CAVUTO: I’d try, I’d try. All right. Very good to have you on, Rush. Be well. Congratulations again on that deal. Rush Limbaugh.

RUSH: Thank you, Neil, very much. It’s always a pleasure to be here.




CAVUTO: Now to that other fear that’s building up, the anti-tax rush, as in Rush Limbaugh. He is so fed up with New York’s new ‘millionaires tax,’ he’s packing up and heading out. The New York governor all but telling him, ‘Don’t let the screen door hit you on the way out.’ The governor isn’t speaking to us, but Rush is. Radio talk show host Rush Limbaugh, joining me now on the phone for this exclusive chat. Well, Rusph, they couldn’t have been more to the point. They’re glad you’re leaving. What do you think of that?

RUSH: Well, if they’re glad I’m leaving, Neil, then I assume that the governor of New York — the unelected governor — has no interest in the tax revenue he collects from me, in which case I would ask him to call off his audit dogs. You know, one thing that hasn’t been reported in this — and I’ve mentioned it each time I’ve talked about stopping doing business in New York — is I left New York as a resident in 1997. I moved down here to Florida, and I have been audited every year. This has been going on since ’97. This is 12 years that I have been audited. The most recent audit is for the last three years. It’s been going on since October.

CAVUTO: Audited by New York State?

RUSH: New York State. New York State. But the city gets involved, and they’re all involved. Once they start auditing you, everybody wants their piece of you. I’m in New York working 15 to 20 days a year, and I have to — as part of this audit — prove where I am every day of the year 14 different ways. And the tax increase here was just, to me, the tipping point because it isn’t worth it. And furthermore, Neil, it isn’t going to work! You couple this ‘millionaires tax’ that starts at $300,000 now, with the desire of the Obama administration to limit executive pay and standard employee pay on Wall Street to a million bucks, half a million, they have no idea the shortfall of tax revenue that their own policies are going to be creating. You said it accurately on Monday afternoon. It’s not that I can’t afford it, but why would I be stupid? What do I get for it?

They’ve got their own separate welfare state that people like me are promoting in New York, and yet we’re held out as the villains. We’re the ones that are considered to be the problems. We’re the targets: the evil CEOs, the evil rich and so forth. I think that in an economic climate like this if they’re going to raise taxes on people, they ought to start whining and dining them. They need to be thanked. These people need to be praised and encouraged to keep working and earning money so that New York can siphon it from them. This is just absurd, the whole thing. I think for the governor to start making jokes about it, ‘Yeah, I would have raised taxes sooner if I would have known that would have gotten rid of Limbaugh,’ fine. He doesn’t want my tax money, then he’s not going to get it.

CAVUTO: Yeah, but what’s interesting, too, is he went on to say that a lot of them said that they’re going to stay here, talking about other rich individuals — not quite as rich as you — that people forget that you need very little to qualify for this millionaires tax, about $300 grand will do it for you, even less in some instances. But this is part of a national trend here. I mentioned some of the states, Rush, that, as you’ve reported as well, are considering doing this. Then what happens? In New Jersey, they keep telling me, ‘Well, the rich didn’t leave,’ but obviously unemployment has been soaring there, so someone is. What do you make of it?

RUSH: Neil, I don’t think it’s a question of people are going to leave. I think in New York, there’s been a steady exodus out of Long Island for a long time. It’s not just income taxes that are pressuring people there, property taxes. Even though the home values have declined, the property taxes haven’t. People have been fleeing the Northeast, including New York and moving to the southern states, many of them with no state income tax. North Carolina is getting a lot of Yankees moving in.

CAVUTO: Right.

RUSH: Florida is and so forth. I think it’s already happened. But, you know, I’m not… I’ve joked and I said, ‘Look if he wants to drive people out of there, I’ll lead the way.’ I’m sure that there are people in New York who will stay and put up with this. I mean, liberals are liberals first, and they will be convinced that they’re doing the Lord’s work here by having more taxes confiscated. If there was some value for it that one could see, but look at the out of control budgets this state has, the out-of-control spending, and the ‘spending cuts’ are always mythical. I’ve never seen a budget get smaller at a state or federal government level. You might have individual bureaucracies that get cut, but overall, budgets never go down.

CAVUTO: So by the same token, Rush, then this tax hike, which we’re told say three trial —

RUSH: Oh, that’s a joke, too, Neil.

CAVUTO: You also question that, right?

RUSH: That’s a joke, too. If you think any tax increase of this magnitude… If it doesn’t work — which it won’t, Neil — they’ll be forced to raise taxes again. It’s sort of like, you know, when the airlines have problems, what do they do? They lower fares. When the New York public transit system has a problem, what do they do? They raise fares! I mean, the government sector does everything the opposite of what the private sector does to compete, and they drive out their best customers. Now, this is, I think, ridiculous to assume that this is going to raise a lot of revenue — and it’s going to be temporary. I know the bridge tolls in all these cities where they built bridges 50 years ago, ‘The tolls are just temporary ’til we pay for the bridge.’ All of a sudden there’s a new need for education that the lottery is not handling, or there’s a new need to cover this or that. They never do with less. They’re always telling us we should. We have a moral obligation to do with less. ‘You have enough,’ they say. It’s none of their damn business who has what. It’s none of their business to decide.

CAVUTO: But are you troubled…? Are you troubled, Rush, that whether you’ve become the poster child for this but it is clearly a class warfare thing going on and —

RUSH: Neil, the —

CAVUTO: — and now it’s heated up. What do you think of that?

RUSH: The only reason I’m a poster child for it is because I’m hated, envied, and despised (chuckling) by people that live there in the media and so forth. I’m a convenient target, and this is another way for people to have fun. I think it’s more serious than that. I left New York in ’97 specifically to escape the onerous income taxes I was paying then. It’s not a question, like I said, of, ‘I can afford it,’ or it’s something that I don’t need. It’s stupid! It’s stupid to waste money — and taxes in a profligate and wasteful state like New York are wasted. They do not accomplish anything. You know, really, Neil, if you look at the structure of New York City, with all the high-rise condominiums and apartments and co-ops, those streets ought to be paved with gold just from the property taxes collected from one building!

CAVUTO: (laughing) Let me ask you then: When you come to New York and do your show for special events, where are you going to stay?

RUSH: I’ll check into a hotel.

CAVUTO: (laughing)

RUSH: But I won’t come! I’m not going to come, Neil, that’s the thing. I’ll come on weekends, if I want to see some friends or do whatever, if I want to go play golf up on one of the golf courses. I’m not going to work there. That’s how I’m taxed. The first audit was for seven years.

CAVUTO: Right.

RUSH: And they claimed I owed them X-number of millions. They even wanted to come, Neil, to both my residences, New York and Florida, to see which one was really more lived in, which one had all the pictures. I mean, the hassle of these audits has just reached a point.

CAVUTO: But what… Has a tipping point also been reached within the Republican Party? It wasn’t too long ago that there was this dustup with you and Michael Steele, the Republican chairman. You’ve since tried to step back and say, ‘Look, it’s not as bad as it was portrayed in the media,’ but it is what it is, and there are many Republicans who argue that you speak for this, uh, tax angst that’s rampant in the party, this billing-government angst that’s rampant in the party. But no one has really stepped up to the plate to address it, either as articulately or as well as you. You know, and that’s why they look to you, and it rattles others within the party. So is this proof of a schism in the Republican Party?

RUSH: Well, there are a lot of schisms in the Republican Party. I think you’re right. It is proof — and I think there are schisms in the conservative movement, which right now is not to be confused with the Republican Party. The conservative movement has people telling us that the era of Reagan is over, that we need to modify, moderate, and move forward. I never hear them say the era of FDR is over. One of the three legs of the stool of Reaganism is tax cuts. It’s about individual freedom. It’s about liberty. It’s not about being tightwad. It’s about individuals working in their own self-interest, as hard or as not hard as they want, to create what they want to create — and keeping what they earn, Neil.

CAVUTO: Well, who personifies that? Who personifies that best for you, of the up-and-coming Republicans now?

RUSH: Well.. (sigh) It’s tough. It’s so early. I don’t know that there’s… I don’t want to leave anybody out by mentioning some names. I like the kind of things I’m hearing out of Governor Sanford from South Carolina. I’ve always admired Governor Palin. I don’t think people have any idea what it’s like to walk in her shoes after what she’s been through with the media coverage, but she doesn’t back down. But too many elected Republicans right now are just in fear, Neil, of being criticized, of opposing the Obama administration. ‘You know, it’s a very special, historical time. We’re not really to be too vocal about opposing this,’ which I don’t subscribe to at all.

I mean, liberalism is liberalism and it’s to be defeated and to be opposed every time it pops up, and so if I’m a ‘leader,’ you know, then it’s just ‘de facto,’ because elected Republican leadership hasn’t yet decided to speak out. I think the alternative budget that the Republicans in the House presented is good on the tax side, ’cause it does not raise taxes. It makes the Bush tax cuts permanent. They’ve got it good. They just have trouble getting coverage in the media — and when they are covered, they’re portrayed as, you know, a bunch of kooks and so forth.

CAVUTO: (laughs)

RUSH: And they don’t want to be portrayed that way.

CAVUTO: All right.

RUSH: We’re not even a hundred days in. We’re going to have to let some of this stuff happen —

CAVUTO: All right.

RUSH: — let some of it fail, let some of it not work, and that will then inspire others —

CAVUTO: Okay, Rush.

RUSH: — to start speaking up.

CAVUTO: Thank you, my friend, very much. Rush Limbaugh.

RUSH: Thank you, Neil.

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