This is a rush transcript of "Special Report" on October 4, 2021. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

JOE BIDEN, (D) PRESIDENT OF THE UNITED STATES: Republicans just have to let us do our job. If you don't want to help save the country, get out of the way so you don't destroy it.

SEN. CHUCK SCHUMER, (D-NY) SENATE MAJORITY LEADER: We only ask that they get out of the way as Democrats pass it on our own, just as the majority party did in the early 2000s. It's really that simple.

SEN. MITCH MCCONNELL, (R-KY) SENATE MINORITY LEADER: The majority needs to stop sleepwalking toward yet another preventable crisis. I guess our colleagues think they can inflate their way out of inflation. That is going to be an extraordinarily painful experiment for the middle class families of our country.

(END VIDEO CLIP)

BAIER: Well, lawmakers talking about the debt ceiling increase, Senator McConnell sending a letter saying "In 2003, 2004, 2006, Mr. President, you joined Senate Democrats in opposing debt limit increases and made Republicans do it ourselves. You explained on the Senate floor that your no votes did not mean you wanted the majority to let the country default, but, rather, that the president's party had to take responsibility for a policy agenda which you opposed. Your view then is our view now."

With that, let's bring this our panel, FOX News senior political analyst Brit Hume, Mara Liasson, national political correspondent of National Public Radio, and Steve Hayes, editor of "The Dispatch." Brit, we go through this dance every so often, this debt ceiling increase. What about where we are now?

BRIT HUME, FOX NEWS SENIOR POLITICAL ANALYST: It has to be done. The debt ceiling has to be raised, and it will be raised, and the president is entirely right when he says that this is not about future spending. It is about past spending. Raising the debt ceiling is not a cause of overspending. It is a result of it.

But having said that, McConnell's point is entirely well taken and what he did in the votes -- in the positions that Biden himself took some time back is evidence of that. This will get done. The reason why Democrats would like very much to get some Republican help on this is because they don't want to have to use the reconciliation process to do it. If they did that, they could do it with 50 votes. They don't want to do that because you can only use reconciliation process more than a few times a year, and they don't want to burn one off for the debt limit. So they would like to preserve it for some of the future spending that they have. And boy, do they have future spending in mind.

BAIER: They have a lot of it. Mara, where are we on the other pieces of legislation? Let's just get off the debt ceiling, which we have to figure out how that is going to pass, but what about the other infrastructure and the big reconciliation bill?

MARA LIASSON, NATIONAL POLITICAL CORRESPONDENT, NATIONAL PUBLIC RADIO: Believe it or not, we have actually made some progress. Now Democrats know they're not going to be able to pass a $3.5 trillion bill. So they are talking amongst themselves about what they could cut or put a short time limit on or stretch out over more years so it could fit into a smaller package.

So progressives got something they wanted, which is they managed to link the bipartisan infrastructure bill and big social safety net bill, the big reconciliation bill, and moderates got something they want, which is the big bill is going to become a smaller bill. But the details are really, really hard. And that's where Democrats are at right now, trying to figure out how to shrink that package.

BAIER: But your sense is that moderates and progressives are still pretty far apart?

LIASSON: Far apart. but at least they are now negotiating on a smaller package rather than talking past each other.

BAIER: Some protesters, as we have seen, going after Senator Sinema. Take a listen, under fire.

(BEGIN VIDEO CLIP)

SEN. BERNIE SANDERS, (D-VT): We have the American people very, very strongly on our side. We have got the president. We got 96 percent of the members of the Democratic caucus in the House on our side. We got all but two senators at this point.

I think Senator Sinema is wrong.

UNIDENTIFIED FEMALE: Just how we got you elected, we can get you out of office if you don't support what you promised us.

UNIDENTIFIED MALE: Do you think that those tactics are crossing a line?

JOE BIDEN, (D) PRESIDENT OF THE UNITED STATES: I don't think they're appropriate tactics, but it happens to everybody that -- the only people that doesn't happen to are people who have Secret Service standing around them.

(END VIDEO CLIP)

BAIER: And the president does, Steve. Senator Sinema released a statement saying "Yesterday's behavior was not legitimate protest. It's unacceptable for activist organizations to instruct their members to jeopardize themselves by engaging in unlawful activities, such as gaining entry to closed university buildings, disrupting learning environments, and filming students in a restroom. It's the duty of elected leaders to avoid fostering an environment which honestly held policy disagreements serve as the basis for vitriol, raising the temperature, and political rhetoric and creating a permission structure for unacceptable behavior." Steve?

STEVE HAYES, EDITOR, "THE DISPATCH": Yes, well, I think Senator Sinema is exactly right about that. I was a little surprised by President Biden sort of shoulder shrug as a result of that. That's inappropriate behavior, as he said, but it doesn't happen to everybody, and it shouldn't happen to everybody. And you would think that the president would use his bully pulpit to make that clear and take down the temperature.

The important and I think interesting turn that we saw over the weekend on the negotiations on these other two bills was when had you Ro Khanna, progressive representative from California, on FOX NEWS SUNDAY yesterday with Chris, say, in effect, that the White House isn't lobbying to get progressives on board with this infrastructure bill. He didn't go so far as to say the White House was actively blocking it, but he basically said, yes, they have told us we can hang tight.

That's a pretty interesting moment when you have a White House not in support of its own bill, particularly when it goes against promises that have been made by the Speaker of the House and by White House, senior White House officials themselves.

BAIER: Part of that protest about Senator Sinema had to deal with immigration and getting immigration into the reconciliation bill, a pathway to citizenship. I spent about an hour today, Brit, talking with the former head of Border Patrol, Rodney Scott, who just left in August. He was in the Biden administration and prior to that the Trump administration, been in this business of Border Patrol for some 30 years. This is another clip from that talking about the wall and haw it became to an abrupt stop when the new administration come in. Take a listen.

(BEGIN VIDEO CLIP)

RODNEY SCOTT, FORMER U.S. BORDER PATROL CHIEF: So we're paying contractors for a while. It was almost $5 million a day between DOD and DHS.

BAIER: to not.

SCOTT: To not build the border wall.

BAIER: Wait, wait, wait, $5 million a day to not build the wall?

SCOTT: To not build a wall.

BAIER: Even though they have all the stuff, they have --

SCOTT: There are stacks and stacks of border wall panels. There's hundreds of miles of fiberoptic cabling. There's hundreds of cameras that were being installed with that. They're just sitting. There is no action being taken. We literally have sections of border wall that are done and all we had to do was plug in electricity to make the gates automated, and that would dramatically improve the area the agents could cover. Couldn't get approval to even turn on the electricity.

(END VIDEO CLIP)

BAIER: It was pretty stunning, Brit. And he went on to say the effectiveness of those different parts where the wall is actually completed.

HUME: Bret, that's part of that wholesale repeal and rejection of the policies that had been put in place during the Trump administration, never mind the fact that a number were working quite well. And the Democrats at one time, many of them had been in favor of a border wall. But it is taboo on the American left which is where this administration's heartbeat seems to be these days. I think it's been a colossal mistake. It has led to the messes that we see down on the border now. It has led to these extraordinary pictures which we have had on the air night after night after night of that situation down there. I think it was the substantive policy blunder, and it will turn out to be a political policy blunder.

BAIER: But he goes on to say, Mara, as he did in the last soundbite, that Secretary Mayorkas knows this issue. He is very accomplished in this area. And yet these decisions they were warning about and implications of them were still made.

LIASSON: Yes, well, look, the administration ran against Donald Trump's policy of building a wall on the border. And there's still a debate with about whether or not that would have stopped the current influx of immigrants at the border or not. This administration is struggling to get ahold of this situation, but I think it would be hard to believe that they would all of a sudden embrace the wall as a solution.

BAIER: Yes. This, Steve, last word, is about resources and about being able to put people in different parts of that border so that the cartels don't move stuff where we are focused somewhere else.

HAYES: I think that's right. I think it's about resources and priorities. The administration hasn't made this a top shelf priority from the beginning, I think in part because of the way that they campaigned, as Mara pointed out. That's the challenge. They can say we are telling people not to come, we are telling people not to come. But when look at actions taken collectively, it sure sends a different signal, and we know that the smuggles are using that to bring people north.

BAIER: Panel, stand by if you would. Up next, the Facebook whistleblower and what's next up on Capitol Hill when it comes to that.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Misinformation, angry content is enticing to people and keeps them on the platform.

FRANCES HAUGEN, FORMER FACEBOOK PROJECT MANAGER: Yes. Facebook has realized that if they change the algorithm to be safer, people will spend less time on the site, they will click on less ads, they'll make less money.

JEN PSAKI, WHITE HOUSE PRESS SECRETARY: This is just the latest in a series of revelations about social media platforms. They make clear that self-regulation is not working.

Our effort is going to be continue to support fundamental reforms, efforts to address these issues. Obviously, that would be up to the purview of Congress, but certainly we view these as a continuing in a series of revelations about the power of these platforms.

(END VIDEO CLIP)

BAIER: Facebook, the whistleblower, out with tens of thousands of documents to back up what she alleges, part of that "Wall Street Journal" blockbuster series investigation looking into what Facebook and Instagram know about the detrimental impacts on teens. Facebook, by the way, says they are back up and running. They were down for about six hours today, as was Instagram and WhatsApp, which a long time. They haven't said why.

We are back with the panel. Mara, what about this? She is going to testify tomorrow in the Senate subcommittee about protecting our kids online. There seems to be a lot of momentum going this way.

LIASSON: A lot of momentum towards regulating Facebook, regulating social media in some way. What she said is what people have been saying for a long time, although she backed it up with all these documents, which is that the business model, the algorithm of Facebook is to keep you online as long as possible so they can sell more ads. And keeping -- and the best thing to keep you online is extreme content. And that's pretty much the business model of social media.

And that Facebook knew that it was damaging and dangerous but when, as she puts it, whether they came to a choice between the safety of the public and making money, they chose making money. I just think that this feeds into this bipartisan consensus that Facebook has to be regulated.

BAIER: Just a few minutes ago, Brit, Senator Blumenthal, Democrat, said "What we are seeing in these documents is truly a searing indictment. The top corporate management of Facebook ignoring their own study and their own surveys and research how they were putting kids in danger profit just to see a profit." It seems like Republicans and Democrats have some regulation in mind.

HUME: Yes, I agree with that, Bret. I think Mara is right. Facebook is accused now of doing these things and allowing abusive content to flourish because it wanted to maximize profits. I have no objection to maximizing profits. To the contrary. But when you are as big and powerful and utterly dominant in the space you occupy as Facebook is, you have to be careful how do you that or else you're going to get legislated and you're going to get regulated in a way you may not like.

You will notice, by the way, that what is likely to come out of this is further restrictions on Facebook's content to avoid what's called extreme content. But Facebook is also the same organization that refuses to permit a lot of content that is not extreme, such as the news stories and comments by a president or former president of the United States. So I think Facebook is in a position where they are going to get it coming and going if they're not careful. And it's not all clear to me that whatever new regulations emerge from this will be regulations we will all be happy with, either.

BAIER: Right, and restricting some stories, the Hunter Biden story, for example, at the beginning, and others.

Steve, taking the other point of view, for the people who say we have these companies that are tremendously successful in the U.S., is it dangerous for us to be going after the goose that lays the golden egg?

HAYES: Right. I think that's a pretty strong argument in many contexts, including in this one to a certain extent. The problem Facebook faces right now is both what they were doing as mara and Brit suggests, but also what they were saying they were doing. And if you look back at what Facebook was making public, they were telling a certain story about Facebook as a good place, or Facebook and Instagram as a good place for young people. This was a place for people to get together. And then you have these documents showing that internally they had come to a different understanding.

I think the same is true on misinformation and hate. Facebook has a robust fact checking program. "The Dispatch" is part of that fact checking program. We think we are doing good as a parted of that fact checking program. But if it is the case that Facebook is preferring or tweaking an algorithm to allow hateful content and misinformation content to go viral at the same time, it's going to overwhelm the efforts of people who are trying to do a good job to correct that.

BAIER: Does this become a major political issue, Mara?

LIASSON: That's a really good question because Facebook is getting criticism from the left and the right. I don't think this is a partisan issue. I don't see which side this favors. I think conservatives and liberals are both pretty upset about social media. And that's why I think that Facebook is going to get regulated one way or another.

BAIER: Brit, do you agree with that?

HUME: Yes, that's what I think is going to happen. And I think we may end up not liking it.

BAIER: Not liking it, period?

HUME: Right.

BAIER: Steve, you mentioned "The Dispatch" is a part of it. What does that mean?

HAYES: Yes, we do fact checking on a wide variety of articles that surface through a tool that Facebook provides. We do fact checking independent of Facebook as well. But we are trying to be a voice that's helping to determine what is true and what's not true, and we think we play a pretty important role there.

HUME: Steve, what did you all do -- what did your fact checkers at "The Dispatch" have to say about the Hunter Biden story?

HAYES: Yes, we didn't do a straight up fact check on the Hunter Biden story in part because there wasn't enough information in those early days to do a definitive fact check. That's part of the role of fact checkers, determining what's factual so that you are correcting facts rather than trying to correct opinion.

BAIER: I respect "The Dispatch," but will there be fact checkers of the fact checkers? Do you know what I'm saying?

HAYES: There always are fact checkers of the fact checkers. We welcome that. We want people to fact check our work. It's good for us.

BAIER: That'd good.

When we come back, tomorrow's headlines with the panel.

(COMMERCIAL BREAK)

BAIER: Finally tonight, a look at tomorrow's headlines with the panel. Mara, first to you.

LIASSON: Mine is about the debt limit. Republicans continue filibuster of debt limit. President tries to get the GOP to stand aside and let Democrats raise on their own. This is why voters are so disgusted with Washington. Usually when there's a filibuster it's because the side that's filibustering is against what the other side want to do. But that's not the case here. Republicans are not against raising the debt limit, they just want Democrats to do it on their own, which they could, but they want to make it as hard as possible for Democrats to do it on their own. They could vote no, but they won't.

BAIER: Brit?

HUME: President Biden tries to follow Senator Kyrsten Sinema into a bathroom but gets confused and goes into the men's room. Sinema gets away.

(LAUGHTER)

BAIER: All right, Steve?

HAYES: Mine was in that same cheeky vein reflecting the Facebook outage earlier today -- grandma back to communicating love with baked goods instead of conspiracy memes.

(LAUGHTER)

BAIER: Nice. All right, panel, thank you.

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