Speaker McCarthy Joins CNBC's Squawk Box

Joining us right now is former Republican House Speaker Kevin McCarthy. He's the chairman of the Alpha Institute. Kevin, it's great to see you. We have not spoken since the midterm election. And before we get into sort of the machinations in the House, I'm curious what your reaction to the election was. And I'll ask you the same question that President Trump was asked on 60 Minutes. What's your political analysis of what happened? Well, this is much deeper than anyone imagined. I mean, on your show, I always said the House, I always thought, was going to lose. Never to this deep a position. I mean, we're probably going to end up, the Republicans, at 175. 75. This is a generational loss. But we also lost much deeper. The Senate, governorships, seven state houses flipped. If you look at... Texas, Georgia, and North Carolina, those Senate candidates, if they didn't get one vote on election day, they still would have won. It was a very clear message. I mean, North Carolina losing six seats probably there. This is a wake-up call for Republicans because the Democrats didn't lay out an agenda and the voters didn't go and say, we want this other agenda. They were sending a message not liking what Republicans were doing. The high price of gas. Not focusing on the issues that affect every single day. They're concerned about the ethics of what's happening in Washington. So it's a combination of all of them with a very clear message. Republicans stayed home because they were disgruntled. Independents flipped to Democrats. And the Hispanic vote that Republicans were gaining flipped totally the other side. And I think the president was right when he said last night that ICE went too far. It was a remarkable acknowledgement. And my question to you, though, is, you know, one of the things the president did say is, you know, where where could Democrats and Republicans work together? And he mentioned immigration. Where do you think that they can work together? I actually believe if you were to get an agreement, the best opportunity for Democrats to have is to make an immigration agreement with the president because it's kind of like only Nixon could go to China. The president is the only one that was actually able to secure the border, so no one's going to trust the Democrats with able to secure the border. But I think the president acknowledgement of ICE going too far. He is the gold bearer of knowing that he would protect our border at the same time, make a fair agreement for individuals that are currently here. And I think this is really the opportunity for both parties to come together. Hey, Kevin, what do you think of the president choosing Stephen Miller, though? A lot of people are painting that as a doubling down, particularly on the ICE strategy and things beyond that. Is that not how you read it? I don't read it that way based upon others who could be in that job. And Stephen's been with them before he got elected and always stayed with them. Stephen would write his speeches in the first term. I believe it's a trust level. And the cabinet itself knows Stephen well and works with him. I think this is still an ability to work forward. And remember, I met Stephen back when he was a staffer on the Senate side. So he knows the policy. He knows how the House and Senate works. And I've watched Stephen work on really difficult issues and make compromises. So I believe... As a Democrat, I don't think Hakeem Jeffries' text is the right way. I, as Speaker, would have never made a comment like that, regardless of who the President selected as their Chief of Staff. It's your job to find a way to work with them, and the President has the right to select their Chief of Staff. Talking about the selections, let's talk about who's going to run at the House and who's going to run the Senate on the Democrat side. Then we can talk about the Republican side of all this. But do you think Hakeem gets the nod? And what about Schumer? I think Hakeem gets the nod. It's a large majority. How I would have loved to have that size of majority would have been a different scenario. Now, Hakeem's challenge is just. He needs to be faster to make a decision. His personality, he likes to let it linger out there. As Speaker, you don't have that opportunity. I think with Pelosi being gone, it may even be better for Hakeem, the freedom to go be the Speaker he needs to be in that situation. I think Schumer still gets the nod as well, but I think Schumer may have to say he's not going to stay after two years. Um, so there's an opportunity for somebody else to rise up, but both are going to be internally challenged. Their biggest problem that they have is they never laid out an agenda ahead of time. When you lay out an agenda ahead of time and you win a majority, it helps you manage your own members that if they want to go off on impeachment or investigations, the American public first said they wanted you to deal with. Hakeem will say affordability. But what does that mean? What legislation does that mean? What does health care mean? He missed an opportunity by not laying out an agenda that Democrats ran on and can govern on once they won the majority. And then real quick, inside the Republican Party, who do you believe beyond this president represents the new Republicans, if you will? And what does that even look like? What do you mean by new Republicans? I mean, what Republicans have to do, I came into the election of 06 when we lost the majority. And this election feels a little more like 06 than 2018. My fear is we lost 06 and we lost 08, and I got together with two other members and we created what was called Young Guns, the new conservative Republicans. And we won 63 seats, much more than the Democrats won this time in 2010. I think the Republicans have to do that on their own. There's a lot of bright young members. Brandon Gill sitting in the Congress. I think he is very impressive, articulate, smart, and I think he draws the grassroots coming through. Brian Jack, who's running for the NRCC, he's exceptionally bright when it comes to elections as well. I think you're going to find these people come together and in state houses and others and build on what they currently have. And then finally, what happens to J.D. in all of this? Marco, when you think about 2028, you have a take? I think it opens up the primary for 2028. Had we continued to win, I think J.D. wouldn't have been challenged. This is a question, is J.D. still going to run? But if you look at DeSantis, you look at others, I think we'll have a very open field. And not being on any side. I firmly believe whatever party, they need to have an open primary and let people have that challenge because then their candidate, whoever comes out, is stronger than if they didn't. I mean, when you think of President Trump going into the primary, no one gave him a chance. He's at one percent. You had people who had been very strong and he had an open primary and he became our strongest candidate. I don't think any of those other candidates. Could have beat Hillary. And on the Democrat side, had they had a primary last time, I don't believe Kamala Harris ever would have been their nominee, and they probably would have been stronger in that election. So both parties need to learn. Let the primary flow. Because Republicans lost so bad, it will be an opening for more people to run, some people we probably haven't talked about. And more ideas are better. And trust the voters at the end of the day to make that decision. Kevin McCarthy, always appreciate talking to you. We appreciate you and thank you. And we'll talk to you very, very soon. Thank you. See you soon. Thank you. Meantime...