General H.R. McMaster on global threats; Blunt, Durbin talk DACA, dreamers and dealing with Trump

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General H.R. McMaster on global threats

National security adviser previews President Trump's message to United Nations on 'Fox News Sunday'

This is a rush transcript from "Fox News Sunday," September 17, 2017. This copy may not be in its final form and may be updated.

CHRIS WALLACE, "FOX NEWS SUNDAY" HOST: I’m Chris Wallace.

North Korea fires another missile while London is hit by a terror attack, as President Trump prepares to take the world stage and address the U.N.

(BEGIN VIDEOTAPE)

REX TILLERSON, U.S. STATE SECRETARY: North Korea is now a global threat and it requires a global response.

LT. GEN. H.R. MCMASTER, NATIONAL SECURITY ADVISOR: We've been kicking the can down the road and we’re out of road.

NIKKI HALEY, U.S. AMBASSADOR TO THE UNITED NATIONS: I have no problem kicking it to General Mattis because I think he has plenty of options.

WALLACE (voice-over): We’ll discuss foreign hot spot and preview the president's message at the international community on North Korea, Iran and terror with national security advisor, General H.R. McMaster.

Then, does President Trump have an immigration deal with Chuck and Nancy or not?

SEN. CHUCK SCHUMER, D-NY, SENATE MINORITY LEADER: We have reached an understanding on this issue. We have to work out details.

REP. NANCY PELOSI, D-CALI., HOUSE MINORITY LEADER: We have an agreement to move forward.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: The wall to me is vital. If I don't get the wall, then we will become the obstruction.

WALLACE: We’ll break down the DACA discussion and whether there's a new balance of power in Washington with two Senate leaders, Democrat Dick Durbin and Republican Roy Blunt.

Plus, big tech comes under fire. We’ll ask our Sunday panel about how Russia used Facebook in the 2016 election.

And our power player of the week, breaking barriers while keeping some of the sports biggest stars in the game.

(on camera): What does it mean to you to be the first female head doctor in the history of both Major League Baseball and the NFL?

WALLACE (voice-over): All, right now, on "Fox News Sunday."

(END VIDEOTAPE)

WALLACE: And hello again from Fox News in Washington.

The United Nations General Assembly has been called the super bowl of diplomacy. And this week, President Trump goes to New York to join other world leaders there for the first time. With plenty of hot spots to discuss, what will the president focus on and what action will he seek?

Joining us live here in Washington, the president's national security advisor, General H.R. McMaster.

General, welcome back to "Fox News Sunday."

MCMASTER: Thanks, Chris, great to be here.

WALLACE: As we say, President Trump speaks to the U.N. General Assembly on Tuesday, his first time on that stage. How important does he think the speech is and how will he fit it into his appeal to world leaders into his doctrine of America First?

MCMASTER: Well, he thinks the speech is a tremendous opportunity obviously to reach so many world leaders at the same time and to emphasize really three things. First is to protect the American people, the second is to promote American prosperity, and the third is really to help promote accountability and sovereignty. And in those three things will allow him to communicate his vision for America's role in the world, but also what his expectations are for international bodies like the United Nations, but also of other nations -- the expectation that they are up to protect the sovereignty of their citizens and respect the sovereignty of other nations.

WALLACE: Well, let's unpack that and let's start with issue number one. And that, of course, is North Korea. The president tweeted about that this morning. Let's put it up on the screen.

The president said: I spoke with President Moon of South Korea last night, asked him -- excuse me -- asked him how Rocket Man is doing. Long gas lines forming in North Korea. Too bad.

Well, before I get to the substance, Rocket Man, have you heard that from the president before or is that a new one?

MCMASTER: Well, that's a new one and I think maybe for the president, but it reminds me of a cover of the "Economist" a few years ago, portraying him as Rocket Man. But, of course, that's where the rockets are coming from. Rockets, though, we ought to probably not laugh too much about because they do represent a great threat to all -- to everyone.

WALLACE: All right. But let me --

MCMASTER: As Secretary Tillerson said at the outset, it is a global problem.

WALLACE: Let's pick up on that, here's what you had to say on Friday.

(BEGIN VIDEO CLIP)

MCMASTER: We've been kicking the can down the road and we’re out of road. And so, for those who have said, and have been commenting about the lack of a military option, there is a military option.

(END VIDEO CLIP)

WALLACE: General, what does that mean, out of road? The fact is you want to get sanctions more time. You’re not about to go to war.

MCMASTER: Well, really, it really depends on how we see this threat continue to manifest itself and our judgment about how much time we have. We’re out of road because in the past, the approach taken to the problem of North Korea and the Kim regime over decades has been to enter into long, drawn out negotiations that then deliver an unsatisfactory agreement, an agreement that then the North Korean regime breaks.

And what that agreement does, though, that’s particularly dangerous oftentimes, what has all the time in the past is locked in the status quo as the new normal. And this regime is so close now to threatening the United States and others with a nuclear weapon that we really have to move with a great deal of urgency on sanctions, on diplomacy, and on preparing, if necessary, a military option.

WALLACE: So, how do you draw that line? How do you decide we've reached the point that we have to move to a military option now? How long do you get sanctions?

MCMASTER: Well, the president has asked all of us to work on this. So, we can't really talk about specific timelines or what conclusions we are coming to.

But we are working very hard, very hard to make everything we are doing militarily, diplomatic -- diplomatically, economically, and with our allies and partners to be as effective as we can. And what we recognize is not really much time.

WALLACE: All right. The administration -- I want to pick up on one part of that. The administration talks about getting tough with North Korea's trading partners.

Here's Treasury Secretary Mnuchin this week.

(BEGIN VIDEO CLIP)

STEVEN MNUCHIN, TREASURY SECRETARY: We will use economic sanctions to bring North Korea to the table.

BRET BAIER, FOX NEWS HOST: You’re saying stopping trade with China?

MNUCHIN: Stopping trade with anybody. Nobody would be off the table.

(END VIDEO CLIP)

WALLACE: But the U.S. did $648 billion of trade with China. They’re our single largest supplier for imported goods and our third largest market for export of goods.

General, we’re not about to cut off trade with China. It would crater our economy.

MCMASTER: Well, this is an indication, isn’t it, of how serious this problem is with North Korea, and why it's in all of our interest to work together to resolve it. So, of course, we China to help as much as they can. You know, they have a great deal of coercive economic power over North Korea. And, certainly, we think -- and the Chinese agree -- it's in their interest to have a denuclearized peninsula.

WALLACE: But, I mean, let's be serious here. We’re not going to cut off all trade with China.

MCMASTER: Well, they have to take some steps, though, that restrict trade in any way that we can with this regime, to choke off the resources that allowed this regime to continue to prioritize their military efforts, their missile efforts, their nuclear efforts over the well-being of their own people.

WALLACE: Well, let me just pick up on that, that one point, isn't it possible -- in fact, isn't it likely -- that Kim has decided that the key to his survival is to have a nuclear capability? He talked this week about having equilibrium with the U.S. and that there's nothing that can be done diplomatically, nothing that can be done economically that will stop him from pursuing that effort.

MCMASTER: Well, what he should conclude is the exactly opposite, that that continued pursuit of this nuclear capability makes him more and more vulnerable and makes him less and less secure.

WALLACE: Let's turn to another subject. The president is also going to talk about getting tougher on Iran at the United Nations. But this week, he had the opportunity to re-impose sanctions that were lifted as part of the nuclear deal. He didn't do that.

So, for all his talk about tearing up the agreement. I know he has to recertify in October whether or not they are complying with it, all this talk about tearing up the agreement, in fact, isn't he going to live with it and try to find other ways to confront Iran on other fronts?

MCMASTER: Well, we have to see what live with it means, right? Live with can't be giving this regime cover to develop a nuclear capability. And so, a lot of things have to happen immediately, rigorous enforcement of that agreement. It is under-enforced now. We know Iran has already violated parts of the agreement by --

WALLACE: But the IAEA says that they’re complying with it, sir.

MCMASTER: Well, the IAEA has identified and we've identified some of these breaches that Iran has then corrected. But what does that tell you about Iranian behavior? They’re not just walking up to the line on the agreement. They’re crossing the line at times.

So, there has to be much more rigorous enforcement of the deal and we have to recognize the fundamental flaws in this deal. It is -- as the president said -- it is the worst deal. It gave all these benefits to the Iranian regime upfront and these benefits now they are using to foment this humanitarian catastrophe in the greater Middle East.

This broad range of destructive behavior, including support for terrorist organizations, like Hezbollah, support for proxy forces like 80 percent of the affected fighters fighting on the side of the brutal, murderous Assad regime in Syria are Iranian proxies.

And so, we have to -- we have to recognize the broad range of Iranian destabilizing behavior and we can't allow this deal to enable that. Their missile programs, for example, the way they are seeding this Iranian network with more and more destructive capability that places all their neighbors at risk.

WALLACE: I want to turn to that next subject which you brought up which is terror. The president is going to call at the U.N. for the world to continue its war on terror. Here's what he had to say this week.

(BEGIN VIDEO CLIP)

TRUMP: We have done better in eight months of my presidency than the previous eight years against ISIS.

(END VIDEO CLIP)

WALLACE: But, I don't have to tell you, a bomb went off in the London subway this week. That's the fifth terror attack in Great Britain just this year. And experts say, as we succeed, and we are succeeding, in pushing Iraq -- ISIS back in Iraq, shrinking its territory, it is only getting them to focus more on launching attacks in Europe and the U.S.

MCMASTER: Well, the president has told us we have to do three fundamental things very effectively.

The first is to ensure that these terrorists have no safe havens and support bases that allow them to organize, plan, and conduct attacks against us and against our allies.

The second thing is we have to cut off the financing, the way that they resource these kinds of operations.

And the third, we have to defeat their evil ideology. And this has a lot to do with some of Prime Minister May's top priorities, which is to constrict their ability to use the ability to communicate with each other.

And then, of course, none of this is a substitute for important law enforcement actions across the world and improving even further our ability to share information and to gain visibility of these terrorist networks and defeat them.

WALLACE: There is a report this weekend, I’m sure you read, that says that President Trump has decided he's not going to pull out of the Paris climate accord, that we may reduce our commitment to curb greenhouse gas emissions but he's going to live with the agreement, stay in the agreement with a reduced commitment.

Is that true, sir?

MCMASTER: No, it’s false. That's a false report. The president decided to pull out of the Paris Accord because it was a bad deal for the American people and because it was a bad deal for the environment. It gave the worst polluters the ability to continue polluting and emitting carbon without significantly reducing those levels.

The president is committed to the cleanest water on Earth, the cleanest air on Earth, to an energy policy that reduces carbon emissions but then also provides clean fossil fuels to generate growth in this country and globally. And these priorities he felt we could not pursue effectively within this flawed agreement.

WALLACE: So, he's out of the Paris Climate Accord?

MCMASTER: He's out of the Paris Climate Accord. What he said, the door is open. If you look at what he said on the day that he announced withdrawing from the accord, he said, at some point in the future, if there can be, if there can be a ideal that addresses these some fundamental flaws --

(CROSSTALK)

WALLACE: But the allies said they’re not going to renegotiate.

MCMASTER: Well, the president's ears are open, though, if at some point they decide that they can come forward with an agreement that addresses the president's very legitimate concerns about Paris.

WALLACE: OK. One final area. It's widely known in Washington that you and Steve Bannon have sharply different views of the world. One of the first things you did as national security advisor is kick him out as a regular official member of the NSC.

He has dismissed you and some of the other advisors on the NSC as globalists. He has sharply disagreed with the decision to commit, to double down in Afghanistan.

Question: is the administration better off with Steve Bannon out of the White House?

MCMASTER: Well, the administration is better off when we can serve the president by integrating, coordinating across all of our departments and agencies with our key allies and partners and to present the president with multiple options. And then, based on his decisions, to help the president implement these policies that prioritize, protecting and advancing the interests of the American people.

And so, what's important is to have an inclusive process, not to try to manipulate into a particular decision or to advance your own agenda. You know, we’re advancing the president's agenda and we are advancing policies and strategies that are for the American people.

WALLACE: Well, you strike is a pretty straight talker. Are you saying that Steve Bannon was manipulating, that he was trying to work around and advance his own agenda?

MCMASTER: Well, the National Security Council, I think, has served the president well in bringing him multiple options. There were some who try to operate outside of that process for their own narrow agendas, and that didn't serve the president well.

WALLACE: That some people, does that include Steve Bannon, sir?

MCMASTER: I think this has been too hyped on one individual. I mean, these reports of feuding, this really didn't even happen. I mean, we had our doors open to all perspectives within the National Security Council, and it was up to those individuals whether they would walk through that door and permit -- and participate in an open and transparent process.

WALLACE: General McMaster, thank you. Thanks for your time. You’re a busy guy, we covered a lot of ground there in about 12 minutes.

MCMASTER: It’s always a pleasure, Chris. Thank you.

WALLACE: Thank you. And we’ll be watching the president's speech, of course, on Tuesday to the U.N., sir.

MCMASTER: Thank you.

WALLACE: Up next, we’ll talk with two leading senators about the president’s move to cut deals with Democrats. How long will it affect the Trump agenda and how long will it last?

(COMMERCIAL BREAK)

WALLACE: President Trump had dinner with Democratic leaders Chuck and Nancy this week and they seem to have cooked up at least the outline of a deal on immigration that has many of the most devoted Trump supporters worried. So, where do we stand on DACA and who's driving the agenda now here in Washington?

Joining us from Chicago, Dick Durbin, the Senate's number two Democrat. And here in Washington, Republican Senator Roy Blunt.

Well, gentlemen, let’s start with the big question here in Washington. The most immediate question, does President Trump have a deal with speaker -- former Speaker Pelosi and Democratic Leader Chuck Schumer when it comes to DACA or not?

And here’s part of what was a shifting conversation on Thursday.

(BEGIN VIDEO CLIP)

TRUMP: The wall is going to be built, and it will be funded a little bit later.

SCHUMER: It was a very, very positive step for the president to commit to DACA protections without insisting on the inclusion of or even a debate about the border wall.

TRUMP: They cannot obstruct the wall. The wall, to me, is vital. If I don't get the wall, then we will become the obstruction.

(END VIDEO CLIP)

WALLACE: Senator Durbin, I want to push on two specific points. Is there a deal to protect the DREAMers without funding for the wall? And is there a deal to give the DREAMers a path to citizenship?

SEN. DICK DURBIN, D-ILL., SENATE MINORITY WHIP: Well, there's a basic understanding. Chuck Schumer and Nancy Pelosi met with the President Thursday night. They came to a basic understanding, without the details, without the obvious negotiations that have to follow. And then, Chuck and Nancy said to the president and the White House, we are going to put out a press release, so it's clear on both sides what we've agreed to. They did exactly that.

There was great pushback from the right. They didn't like the parameters of this understanding and there has been a lot of conversation since. But we are going forward. We are going forward with the understanding that we can work with the White House to come up with an agreement that includes DACA, that includes citizenship for those who are protected under the DREAM Act and also has a substantial commitment to increase border protection. Those are the two pillars of this understanding.

WALLACE: And very briefly, in this understanding do you believe that the president committed to those pillars over Chinese food on Wednesday night?

DURBIN: Yes.

WALLACE: That's pretty brief.

OK. Senator Blunt, the president seemed to walk away from at least the citizenship part of this deal later on Thursday. Let's take a look at that.

(BEGIN VIDEO CLIP)

TRUMP: We’re not talking about amnesty at all. We have not talked about amnesty. There will be no amnesty. We’re not talking about that as part of the transaction.

(END VIDEO CLIP)

WALLACE: So, Senator, helpless clear this up, because -- I mean, there's genuine confusion here in Washington. Do you believe that there is a deal on these issues and is this something that Republican senators could support?

SEN. ROY BLUNT, R-MISSOURI: Well, I think there's a desire to come to a conclusion here on both sides and Senator Durbin just mentioned border security as part of the understanding, but the details haven't been worked out, another thing that he mentioned.

Well, the details here matter. You know, it's always been three separate questions in my view. One is, how do you secure the border? Two is, what are the legitimate workforce needs of the country? And three, what you do with people who came or stayed, or in the case of the Dreamers, were brought to the country illegally?

I think it would be very shortsighted not to try to do all we can to solve the first problem, and the president has unbelievable credibility here. If you solve the first problem, the other problems I think are reasonably solvable, we are seeing that to happen as people want to come together and deal with the issue who of kids who were brought here illegally.

But you’re not going to be able to solve this problem in a satisfactory way unless you give the present at the leeway he needs to be able to some point in the future say the border is now operationally secure. That allows everybody to move to solve these other problems in a better way, Chris.

WALLACE: But, again, briefly, and I hope you will be as brief as Senator Durbin is, giving them leeway to secure the border, does that have to include funding for the wall, specifically funding for the wall as opposed to other measures, and secondly, citizenship for Dreamers?

BLUNT: It appears it would -- it would not preclude the wall, but it doesn't have to include the wall at this point I don't think. There are a lots of things have to happen to secure the border and should -- in terms of citizenship, does that mean you wouldn't have to take the test that everybody else takes? How long would you have to be here under the DREAM Act (ph)? There are lots of things that can and will be worked out there.

WALLACE: All right. Let's turn to the bigger issue, which is whether or not President Trump is forming a new alliance with congressional Democrats at the expense of Republicans. Here is what the president had to say about that on Air Force One.

(BEGIN AUDIO CLIP)

TRUMP: If the Republicans don't stick together then I’m going to have to do more work. If they are unable to stick together, then I’m going to have to get a little help from the Democrats and I’ve got that, I’ll tell you.

(END AUDIO CLIP)

WALLACE: Senator Blunt, given the failure of Senate Republicans to pass Obamacare repeal and replace, isn't it wise for this president to go to Democrats and look for some votes?

BLUNT: Well, I think the minority can't abuse the rules of the Senate. But under the rules of the Senate, you have to have some Democrats work with you to get most things done. The tenures -- I was either the chief deputy whip for the deputy whip in the House, we passed two bills in 10 years that didn’t have Democrats vote for them. That's part of the work -- that’s how you get the work done here in a way that allows everything else to move forward.

So, looking for Democrats on every bill is a good idea, but making it impossible to get your work done because you’ve lost your own side is not part of that either.

WALLACE: Senator Durbin, do you think that there is the potential for a real -- not permanent, but working alliance between President Trump and congressional Democrats? And what you say to those members -- folks on the left who don't trust this president and don't trust making deals with him?

DURBIN: Well, of course, there will be people on the right and left who will be critical. But Senator Roy Blunt and I are good examples of how this can work. I have joined him and applauded his leadership in dramatically increasing biomedical research in the United States on a bipartisan basis. Lamar Alexander, Patty Murray joined us.

Two weeks ago, Schumer and Pelosi sat down with the president and the other leaders and said, we can help you move immediately for Hurricane Harvey assistance, to have a short-term spending bill so the government doesn't shut down and to extend the debt ceiling of the United States, we’ll do it on a bipartisan basis, Mr. President. That's what American wants. And the president said, I’ll take it.

We did it. And we can do more like that, as long as we trust one another, respect the differences that we obviously do have, but try to work toward a goal. Patty Murray and Lamar Alexander have accomplished more in the last two weeks of strengthening our health care system and moving forward to make the Affordable Care Act more affordable and more transparent than we achieved in seven months of partisan wrangling on the floor of the Senate. It can be done.

WALLACE: But there are some differences. I mean, you talked for instance about NIH spending, the Trump administration wants to cut NIH spending.

And let me talk about another big difference on the hot issue of tax reform. The president wants to slash corporate taxes and end the estate tax, Democrats opposed both. The president talks about paying for tax cuts based on assumptions of dramatic growth, Democrats reject that.

Senator Durbin, is there a deal given those very sharp differences, fundamental differences, is there a deal to be made on tax reform?

DURBIN: Chris, there will be differences, but that's what the Senate is all about -- sitting down with Democrats and Republicans and the Republicans are in the majority, and really working out an amendment process that comes to a conclusion where both sides have to compromise to some degree. That's where you get the best legislation and that's where you get something the American people can trust.

Jamming something through on one side or the other is just not the way to achieve it. We proved that with repeal and replace. That did not achieve what America wanted, a stronger health care system with more people with insurance coverage and quality insurance policies they can trust.

WALLACE: Senator Blunt, what are the implications of all this for the 2018 midterm elections? You have the president out on the stump recently with North Dakota Senator Heidi Heitkamp. This is somebody who was a vulnerable Democrat, one of the prime targets for Republicans to knock her off in 2018. The president is saying nice things about her.

When you add that to the president appearing to compromise on some of his basic campaign pledges, couldn't this hurt Republicans in 2018?

BLUNT: Well, on the tax front, it’s very important we get something done -- increases take-home pay for working families, that we’re almost into a decade now of very flat opportunities for families with their take-home pay. A tax bill that increases take-home pay, and in the future creates better jobs with more take-home pay, with more pay to start with is where we should be headed.

We ought to be looking for anybody who wants to be part of that. But, you know, 46 Democrats sent a letter to the president that said, we’d be glad to work with you as long as you don't do these three things that you think are important parts of the tax package. That's not a good way to start.

WALLACE: Finally, Senator Blunt -- and I got about a minute left -- there was more violent protest in St. Louis overnight. People angry about the acquittal of a white police officer who was charged with murder in the death of a drug -- black drug suspect. I know everyone opposes the violence, but even the mayor of St. Louis said she was appalled by the shooting and appalled by the verdict.

So, what’s your reaction to the situation there and the clear anger of a lot of people in the African-American community?

BLUNT: Well, I talked yesterday to the police chiefs that are involved in what the chiefs are doing. I also talked to a number of community leaders and African-American pastors. I do think this is a place where we have to figure out how to come together. You do have to accept what the judge who has the obligation to look at this case determined.

But at the same time, you have to look at what we need to do to bring the community together in ways that both law enforcement and community leaders have been trying to do, particularly since Ferguson. This happened before that happened. And we just need to continue to watch this.

The division in the country whether it's St. Louis or Baltimore is not a good thing and we all need to be working hard to make our system work.

WALLACE: Senator Blunt, Senator Durbin, thank you both. We’ll stay on top of how all of this work between the president and Chuck and Nancy plays out in Congress. Thank you all, gentlemen.

Coming up, we’ll bring in our Sunday group to discuss President Trump's new search for votes on both sides of the aisle.

Plus, what would you like to ask the panel about the president's potential deal to protect Dreamers without getting funding for the border wall?

Just go to Facebook or Twitter, @FoxNewsSunday, and we may use your question on the air.

(COMMERCIAL BREAK)

WALLACE: Coming up, President Trump reaching across the aisle on tax reform, suggesting there may be no cuts for the rich.

(BEGIN VIDEO CLIP)

TRUMP: I think the wealthy will be pretty much where they are -- pretty much where they are.

(END VIDEO CLIP)

WALLACE: We’ll ask our send a panel about the prospect for passing tax reform.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SCHUMER: He likes us. He likes me anyway.

I said, Mr. President, you're much better off if you can sometimes step right and sometimes step left. If you have to step just in one direction you're boxed.

(END VIDEO CLIP)

WALLACE: Senate Democratic Leader Chuck Schumer caught on a hot mic on the Senate floor describing his advice to President Trump to deal with both Democrats and Republicans in Congress.

And it's time now for our Sunday group. Former speaker of the House Newt Gingrich, Rachael Bade, who covers Congress for Politico, Julie Pace, Washington bureau chief for the Associated Press, and Guy Benson of townhall.com.

Well, Mr. Speaker, you worked with Bill Clinton in the mid-1990s as he wasn't doing what was called triangulation, trying to negotiate apart from both Republicans and his own Democratic Party. Is that what President Trump is doing here, and will it work?

NEWT GINGRICH, FOX NEWS CONTRIBUTOR: Well, I think Trump is a better dealmaker. I think that's -- he wants things to work. He wants to get the job done. I think the other day he was faced with two visits to Houston, terrible devastation, a hurricane coming to Florida, and he had the usual partisan infighting for two or three weeks or take a deal.

And he took a deal. And it worked. And I think he thought, well, maybe we'll do a little more.

Now, the challenge will be that the goals of Schumer and Pelosi and their base are so radically different from Trump that the margins for deals may be smaller than people would like. But I think it's perfectly reasonable. I -- look, I advocated for months that they start with infrastructure because it was inherently bipartisan. And I think that presidents govern best when they carve a large block out of the opposition party and have a -- and have a much bigger majority than just their own partisan base.

WALLACE: Julie, what are they saying -- you cover the White House -- what are they staying at the White House. How frustrated are they with Republican leaders and particularly their inability to deliver on Obamacare repeal and replace? And how much hope to they hold given that, as I said, on a lot of the -- and the speakers said on a lot of the basic issues what they want in tax reform, what they want in immigration, that there's such big differences -- how much hope do they hold for a working alliance with the Democrats?

JULIE PACE, THE ASSOCIATED PRESS: Well, I think you have to put this in context of the relationship that the president has with McConnell and Ryan. With McConnell in particular, there's just not much of a relationship there. So when you come out of something like the Obamacare debates and the president sees that McConnell just can't get it over the finish line, there's not a lot of personal bonding there to keep that going. So there was a lot of frustration in the White House after that specific debate on the Capitol.

And I think when the president looks at Schumer, more so than Pelosi, but Schumer in particular, you know, he sees someone he likes. And this is a president who like the personal relationship. He likes to have a bond with someone. Yes, there are going to be differences on the policies, yes, they are not going to be aligned on everything. But where he can make an agreement, I think he is perfectly fine. And he's been hearing from people like Speaker Gingrich and others around him for months that this is actually what he should do, that this is an advantage for someone like Trump, who isn't particularly ideological, who doesn't have deep roots to the conservative movement or Republican ideology.

WALLACE: So -- so when it comes to DACA, does not mean the wall? Well, maybe not. Citizenship? Maybe yes.

PACE: I think on the wall, I mean this is something that you've seen the president multiple times when he's had a chance to go to the mat over the wall and say, I'm going to hold up a certain piece of legislation, I'm going to veto it over this wall. He's backed off. And I think that for his base, that's going to continue to be a frustration, but he's certainly shown a willingness to punt that, kick it down the road a little bit.

WALLACE: We asked you for question for the panel. And on this issue of the president making a deal with Democrats on DACA, there was a lot of confusion from you, as there has been here in Washington. Let's put some of it up.

Fox Mulder -- I love that -- tweeted this, does Trump even want to get funding for the wall? Build that wall got him elected. How else will he rally his base?

And Rick Conner posted this on Facebook, how do you think amnesty for these illegals will square with the president's campaign promises to the contrary? Is this just a negotiating ploy to get his agenda through, wall and all?

Guy, how do you answer them?

GUY BENSON, FOX NEWS CONTRIBUTOR: That's what everyone is trying to figure out in this town, including, I think, both senators that you just interviewed a little while ago. You know, I went back and tried to figure out maybe what would a deal start to look like on DACA? What would the contours perhaps start to come together with? And I think the wall seems to be out, at least for this particular piece. He says maybe sometime in the future. Unclear.

But it seems like ancient history at this point. But 2013 there was the gang of eight bill that eventually was killed in the House. But Democrats agreed in principle to a whole swath of border security and immigration enforcement provisions that I think would probably form the basis for something where Trump could potentially, somewhat credibly, claim a victory. And I went back and I looked at some of those provisions, $40 billion for border security, 20,000 new security agents, 700 miles of fencing. That's a physical border. That was in gang of eight, agreed to in the so-called "border surge." So there's a chance that while the wall might be part of a DACA deal, there could be something that could be spun as or framed as a wall or a physical barrier.

WALLACE: And how do you think -- I mean it's crazy to ask you what's the base going to do, but I'm going to ask you, what do you think the reaction of the real Trump hardliners, the real base will be if they get a deal on DACA that includes citizenship and doesn't include a wall as it had been commonly thought to exist?

BENSON: Well, last week I had a long car ride, so I listen to talk radio for about six hours straight, and it was really interesting. They opened the phone lines and it was Trump base voters calling in. And there was some trepidation, there was some concern about where this might go. But, overall, there was a sense that they trust President Trump, that they think that he's three steps ahead of anyone else and that ultimately he's got their interests at heart. And that was sort of reflected across-the-board for most of his supporters. So that's what I would guess would be the case, unless it is egregiously bad.

WALLACE: Rachael, from your post covering Capitol Hill, what do you think is the -- are the prospects for a deal that can be passed on DACA and the prospects for a deal on tax reform?

RACHAEL BADE, POLITICO: You talk to Republicans right now, they would tell you, a slim chance in terms of the White House striking a deal with Democrats and getting it over the line, while cutting out GOP leadership. You know, you mentioned that a lot of the base still has faith in Trump and they see this. They say he knows our interests, he's going to do what is best for us.

There's a totally different feeling on Capitol Hill with GOP leadership. I heard a lot of frustration and questioning of, what is this strategy? What is the end game here? Basically, you know, Republicans control both houses of Congress. You know, so cutting out leadership is not the smartest thing for the president at this point in time, at least Republicans will tell you that.

For instance, take the DACA deal. I was talking to some folks in leadership who were saying that they don't understand why he took the wall off the table to begin with. It's the number one bargaining chip, they said, in terms of negotiating a deal. If you're going to take it off the table with Democrats, you should get something for it. So they're going to try to push him to put that back on the table and sort of use that to get a deal that is possible that conservatives could vote for it.

WALLACE: And what about tax reform? This is -- I pointed out with the two senators, they're so different on tax cuts that would benefit the wealthy, on whether or not it's going to add to the deficit or not, unless you put in what they called dynamic scoring and include a lot of the growth that is a guess whether or not it's going to happen.

BADE: Yes, I don't mean to sound alarmist, but tax reform is also in trouble right now. And it -- again, it goes back to this sort of shift we're seeing in the president going from just working to Republicans, to now wanting to work with Democrats. For instance, Republicans on The Hill, Speaker Paul Ryan, Mitch McConnell, Treasury Secretary Mnuchin, Gary Cohn, they've all been writing a Republican bill and they're about to unveil it.

Last week we saw the president come out and float the idea of increasing taxes on the wealthy, which blows in the face of sly-side economics and goes against -- 100 percent against what Republicans would want to see in a tax bill. So there's a fear that he's overstepping right now in terms of reaching out to Democrats and they're concerned that this is going to undercut them. And not only a Republican base, but the president and what he wants to do.

WALLACE: A quick reactions, speaker?

GINGRICH: I think the most interesting side story was Democrats won this big agreement. Everything was going to end in December. The Democrats are going to have this huge leverage because the debt ceiling ended in December. A few days later, Mitch McConnell pointed out that as the majority leader he controlled the paper. And they took out the provisions Schumer most wanted. And --

WALLACE: Which was about extraordinary measures, which means that they can keep the debt ceiling going till March.

GINGRICH: February or March. And he said, you know, I happen to be the majority leader and I control the paper and we did it on my way (ph). And Schumer, faced with that reality, couldn't break -- he couldn't say no. So we're a long way -- this dance is going to continue for a while. I think the Democrats face the real risk. Do they really hate the wall more than they love the dreamers? Because if I were the president, that's the way I'd drive it. I'd say these people are so ideological they'd rather sacrifice the dreamers.

WALLACE: All right. Gridlock breaking out here in Washington.

All right, panel, we have to take a break here.

When we combat, with growing tension between Washington and Silicon Valley, powerful Internet companies face talk of more government oversight. We'll bring back the panel to discuss Congress' new scrutiny of big tech.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MARK WARNER, D-VIRGINIA SENATOR: I think that we're still at the tip of the iceberg. The fact is, I don't think FaceBook has put the resources, the time. My understanding is they didn't even go back and check all those accounts to see if they had put out -- put out other ads.

(END VIDEO CLIP)

WALLACE: Democratic Senator Mark Warner of Virginia after Facebook admitted it sold $150,000 worth of ads in the 2016 election to groups linked to Russia, spurring investigations by both congressional committees and Special Counsel Robert Mueller.

And we're back now with the panel.

Speaker Gingrich, how big a development is this and are we beginning to see the end of Washington's hands-off approach to big tech and especially these huge Internet companies?

GINGRICH: Yes, look, I think this is probably four to six years behind the curve. These companies are so big, they control so much of our lives, they can set so many different policies internally with no supervision, that having not just the Russian angle, but really looking at the underlying nature of these companies, what they do, how they make decisions, these are the equivalent of gigantic public utilities. And in the information age, they have enormous power. And I don't think you, in a free society, you can't have power that's hidden away in secret, controlled by a handful of billionaires.

WALLACE: Well, one of the things that Mark Warner, who was a tech guy himself before he went into politics, said, that it's the wild, wild west there. Now, some people would say that's one of the reasons it succeed. Are you saying put government clamps on it?

GINGRICH: No, look, I think having the wild, wild west when companies are small is exactly right. Several of these companies are so enormous that there's some sense of, what does it mean to us as a free society to have global corporations run by founding billionaires who are -- have been, in effect, totally out of control and who internally can wipe out a company and wipe -- I mean they can be anti-conservative, they can be anti-liberal, they can do all sorts of things, and there's been almost no supervision, just to surface (ph) the information.

WALLACE: President -- Rachael, President Obama and Democrats, I think you'd agree, generally had a pretty cozy relationship with the big Internet companies, like Facebook, like Google, like Amazon. Is that changing on Capitol Hill now, as the speaker suggested it should, and is there a partisan divide in how Republicans and Democrats see these Internet behemoths?

BADE: Yes, absolutely. The days of the industry sort of basking in the sunless praise from Washington are basically coming to an end right now. Look, for a long time Congress had sort of a light touch with the tech industry, but now you have Democrats who are furious about these Russia-linked ads that ran in 2016. Republicans are worried that Google is oppressing conservative voices. Both sides are concerned about people's private information being gathered and what happens if they're hacked. And so those are all concerns.

So, yes, generally, Republicans control everything right now in Washington and they're typically anti-regulation. But it's safe to say that this sort of darling industry is now becoming a target as much as anything else.

WALLACE: And do you have any thought about how you do it when the rubber hits the road? How do you allow these companies to grow and prosper but with some guardrails?

BADE: I think that's the question that The Hill is sort of grappling with right now, how do they do this but allow an industry to continue to grow, that influences everyone's life so much? Look, there's a test case that's going on right now on Capitol Hill. There's going to be some hearings coming up in the Senate this week to examine whether big websites and tech companies can be held liable for child sex trafficking on the Internet. Right now they cannot be sued if a user were to put illicit content on the Internet.

So the Senate is going to look at re-examining this. The tech industry is putting a lot of money in K Street to lobby against this. But I think this is an interesting first test, right? Like if -- if they can't -- if they're not going to see something as heinous as child sex trafficking as a reason to regulate, then it's safe to say that big tech still has a lot of power.

WALLACE: It's funny you talk about K Street. It is amazing. Which is the big center of lobbying here in Washington. And there was a chart in The Wall Street Journal that show the lobbying expenditures by these companies has just skyrocketed in the last few years.

Julie, where are President Trump and his administration on this? You talk about utilities, Speaker Gingrich. Steve Bannon used to talk about treating Facebook and Google as public utilities, which meant heavy regulation.

PACE: Right. Steve Bannon, of course, now outside the White House. So, look, the -- at least rhetorically the position of this White House, when it comes to big tech, is so different from the Obama administration, which really wrapped its arms around the Googles and Amazon's and Facebooks and presented them as examples of American companies that are -- that are growing strong and are dominating on the global stage.

Trump, I think, has been turned off a bit by the fact that some of the leaders of these companies are not particularly pleased with his administration and have spoken out on a lot of issues. I don't think you can divorce this conversation when it comes to the White House from that. But he's also taken on Amazon, and not just for Jeff Bezos's role in owning The Washington Post, he's taken on Amazon on his Twitter account.

I think that you are seeing some of this stemming from the president's populist message in general as well. I mean he looks at Wall Street and some of the big firms there and I think looks at tech in somewhat of the same way, a massive company that can get out of control. And he -- when he looks at his base, he can see their frustration with that. The frustration of small business owners who see themselves getting taken over by a giant like Amazon.

WALLACE: Yes. There's also this whole question, before I get to you, Guy, about the fact that Internet companies, when they have sales, they don't have to pay taxes, but the mom and pop store in the town on Main Street does have to pay taxes.

PACE: And that's when you've see him go after Amazon in particular for. He's done this in a -- in a series of tweets. I think it will be interesting to see if this comes up in the discussion on The Hill on tax reform if we are -- do end up talking about a big tax reform package.

WALLACE: That would actually add a lot of revenue, wouldn't it?

PACE: Yes (ph).

WALLACE: That would really -- that would get the lobbyists -- because, Guy, there's another aspect of all of this that I want to get to, and that's growing questions about the culture in Silicon Valley.

You had three former female employees of Google just file what they hope will be a class action lawsuit charging them with pay and promotion discrimination. And as you know, there have been a number of complaints and lawsuits alleging sexual harassment in these companies. So that wild, wild west attitude applies also to the culture in Silicon Valley.

BENSON: That's right. So you'll have Democrats, in particular I think, focusing on those problems and equal pay and is there discrimination in Silicon Valley. And then you'll have on the other side, as Rachael alluded to, a lot of conservatives and Republicans look at what happened at Mozilla a few years ago and Brendan Eich ousted from that company for having traditional views on marriage. And then the firing of that engineer of Google.

Is there rampant discrimination in terms of viewpoints against conservatives and how might that play out in terms of average users having information potentially stifled in searches? There are real concerns about that on the right. So, big tech might be waking up these days and saying, uh-oh, we have real problems culturally on the left and the right in this country and that could be a problem for us on Capitol Hill as lawmakers on both sides, rather, start to dig in.

WALLACE: But I want to pick up on something that I asked Speaker Gingrich, because there's no question that these companies have been engines of huge economic growth in this country. Is there a downside to Washington -- obviously there's a downside. How big a downside is there to Washington getting more involved in regulation of the Internet?

BENSON: A huge downside. I think some of the concerns that the speaker raised are fair and reasonable and people would agree with them. My faith in the ability of government to respond to that wealth to regulation is very low. I think it is -- government is slow-moving. It is the opposite of innovative. And the Internet is a miracle. And it wouldn't exist as it does today if the government's clumsy hand had been on its neck from day one. And I think putting more hand on the neck and applying more pressure from D.C., I'm just not sure that works out well.

WALLACE: Fifteen seconds to respond, speaker.

GINGRICH: First of all, the Internet was created by ARPANET, a Department of Defense project. Second, the fact is, there are no time in American history when the huge concentrations of power are not directly challenged by government. And that's overall been good for protecting our liberty.

WALLACE: All right. We'll continue this debate.

This is an important subject and we'll keep talking about it.

Thank you, panel. See you next Sunday.

Up next, our "Power Player of the Week." The doctor who keeps both the Washington Redskins and Nationals healthy, while breaking down barriers in pro sports.

(COMMERCIAL BREAK)

WALLACE: The pro football season is now in full swing. And as we fans dream of how our team will get to the Super Bowl, we know injuries have a way of derailing those hopes, which brings us to our "Power Player of the Week."

(BEGIN VIDEOTAPE)

DR. ROBIN WEST, HEAD PHYSICIAN, WASHINGTON REDSKINS: In sports medicine, people are very highly motivated so they can play to get better.

WALLACE: Orthopedic surgeon Robin West has a busy schedule. Most of the time she's the head of Inova Sports Medicine in Virginia, except when she's the lead position for both the Washington Redskins and the Washington Nationals.

WALLACE (on camera): What does it mean to you to be the first female head doctor in the history of both major league baseball and the NFL?

WEST: I don't even think about it. I never -- it never really crossed my mind. I -- I never think of myself as different.

WALLACE (voice-over): We saw for ourselves at a Skins exhibition game. Nose tackle Phil Taylor went down on a play and West ran on the field. She examined him there and back on the sidelines for what turned out to be a season ending tear of his left quadriceps muscle.

West told us how different injuries are in the two sports.

WEST: It's over use typically in baseball. We're dealing with a lot of shoulder and elbow injuries in baseball. In football, it's a lot of traumatic injuries, high-energy injuries that we have to really manage quickly.

WALLACE: That's another difference. In baseball, an injured player is out of the game. But in football --

WEST: The coaches are in my ear as I'm examining the kid, is he going to play, is he going to play? I have to decide that pretty quickly.

WALLACE: But West emphasizes how she makes that decision.

WEST: I'm the players' doctor, right? So it's -- I want the best for the player. So, obviously, I work for the -- I don't work for the team, I -- I want the team to do well, but I have to look at the players' best interests.

WALLACE (on camera): Is being a woman an advantage or a disadvantage to doing your job?

WEST: At least in football, a lot of them were raised by their mothers and their grandmothers and so they have -- they hold women in a very high regard and they come to me and will tell me more information and I -- they are very trusting, I think.

WALLACE (voice-over): Dr. West usually does any reconstructive surgeries, but she says psychological outlook is key to getting players back on the field.

WEST: One of my players today, who I operated on last week, he said he's a mental fortress. But yet I have another player who's coming to me and saying, I'm just -- I'm so depressed. I'm not around my team. I -- and they're coming to me and they're asking me for help on the mental side.

WALLACE: Growing up, West was interested in the human body. Her mom noticed.

WEST: When I was five, she got me a "Gray's Anatomy" book for Christmas.

WALLACE (on camera): Why?

WEST: That was my present. I don't know. I just was fascinated by it.

WALLACE: Now the big concern is brain injuries, but she says the NFL has developed a much stricter policy on concussions.

WEST: I think football's the safest it's ever been.

WALLACE: Before Washington, West was an assistant team doctor for the Pittsburgh Steelers and got two Super Bowl rings. Her dream now, to win championships in both football and baseball.

WEST: That's our goal, right? That's everyone's goal on the team is to keep the players healthy and to be as successful as we can. It's a pentacle, and you can't get any better than that.

(END VIDEOTAPE)

WALLACE: Dr. West says the Redskins have 15 medical professionals at each game on the field and up in the stands watching to see if any player gets hurt and relaying that information to her.

And that's it for today. Have a great week. And we'll see you next "Fox News Sunday."

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