What follows below is an excerpt from my conversation on Kudlow & Company last night with supply-sider Steve Forbes regarding Phil Gramm’s future with the McCain campaign. Mr. Forbes is the president & CEO of Forbes Inc and has advised the campaign on economic policy. Click here for more of my thoughts on this developing story.

Steve Forbes, we just have a little bit of time. A lot of conservatives are very dispirited that Phil Gramm has left the McCain campaign, Steve. Has he in fact left? I know he resigned. Will Senator McCain, who has yet to speak about this, do you think Senator McCain will ask him to come back?

Steve Forbes: Oh I think in terms of advice, Phil Gramm will be critical, which is good, because on things like trade he’s absolutely right. I think John McCain has a long friendship with Phil Gramm. So this was something, Phil Gramm said something that you’re not supposed to these days. And he paid a price for it. But in terms of the relationship, I think it’s as strong as ever. And in a McCain administration, I think Phil Gramm’s advice will be taken to heart.

Kudlow: Why won’t Senator McCain say what you just said publicly? In other words, McCain can say, ‘I don’t want your resignation, you misspoke, let’s leave it be, we’re a large tent, a big family, we need you on this campaign’, Steve. Do you think McCain will come out and say that?

Forbes: I think he will say good things about Phil Gramm. And Phil Gramm paid the price for it. Gramm’s been in presidential politics, as I have, and when these things happen somebody walks the plank. But I think in terms of the relationship, and the philosophy, that’s not going to change.

Kudlow: All right. Appreciate it, Steve Forbes. Very, very much.