This is a rush transcript from "Special Report with Bret Baier," January 18, 2018. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIPS)

HOUSE MINORITY LEADER NANCY PELOSI, D-CALIF.: We will be opposing this continuing resolution because while they put the CHIP program in there, they do not put the accompanying provisions that make CHIP work.

SPEAKER OF THE HOUSE REP. PAUL RYAN, R-WIS.: The most responsible thing we can do is avoid the chaos and pass this continuing resolution that we're bringing to the floor.

SENATE MINORITY LEADER CHARLES SCHUMER, D-N.Y.: The CR prepared by the speaker is not an honest attempt to govern.

SENATE MAJORITY LEADER MITCH MCCONNELL, R-KY.: We can pass a noncontroversial, bipartisan bill to keep the government open, or Democrats in Congress can manufacture a crisis and force a government shutdown over the entirely unrelated issue, the entirely unrelated issue of illegal immigration.

(END VIDEO CLIPS)

BRET BAIER, ANCHOR: At this hour, Congress is not sure whether they are going to have the votes. Maybe in the House they do but in the Senate side it looks more doubtful at this hour. Senator McConnell putting out a letter to Senate Republicans earlier, "We should all plan to stay through this weekend if Senate Democrats follow through and are willing to shut down the government and the Children's Health Insurance Program," that's CHIP that Representative Pelosi was mentioning earlier, "because they have yet to conclude a deal on DACA. This is an irresponsible position to take as everything from pay for our military to processing Social Security checks will be affected. I hope not a single Republican is inclined to join them. I know we are all frustrated by the pace of negotiations on spending, but joining Democrats to shut down the government plays right into the Democrats' hand."

Senator Lindsey Graham put on a statement saying he is one of them and there may be others.

Let's bring the panel: Jonah Goldberg, senior editor of National Review; Amy Walter, national editor for The Cook Political Report, and Steve Hilton, a former adviser to British prime minister David Cameron and host of "The Next Revolution" here on Fox News Channel.

Amy, just in the past minute or so, the Freedom Caucus saying they are warming up to the idea of supporting a continuing resolution in part because they are going to have another vote to bolster military readiness. But it is nip and tuck up there.

AMY WALTER, COOK POLITICAL REPORT: It is. We knew this going in. And this has been pretty of a much constant even in the Boehner era, nonetheless Paul Ryan era of a conference that does not have the ability to be organized in one nice, tight movement.

We thought that maybe the president was going to be able to bring a party together. We spent most of 2016 talking about the party kind of breaking apart. Now here's a chance for a unifying moment, but the problems that were there before Donald Trump was president remain even as president, issues about spending, issues about immigration still divide the party. They're going to continue to divide the party whether it's in the House.

And the other issue of course going forward which we're going to talk about is it may pass the House, but I think you're exactly right. The Senate is a whole different ball of wax. Not only do they need Democrats to support this, but right now I think they've lost, Mitch McConnell has lost two Republicans, maybe three. So that means getting 11 to 12 Democrats.

BAIER: I think Lindsey Graham, Rand Paul and maybe others.

JONAH GOLDBERG, NATIONAL REVIEW: Also McCain and Cochran aren't necessarily going to be there for the vote. So you're starting with maybe 49, which is a problem.

BAIER: So what does this mean about the ability of Republicans to control the White House, the Senate, and the House, and the ability to have government function, period?

GOLDBERG: I don't think it speaks very well. And obviously these are divisions, as Amy was saying, that go back a good ways. I think in some ways you can sort of see one of these divisions in the sort of implosion of an immigration deal this week because Lindsey Graham may speak for a handful of Republicans but he actually doesn't speak for the ideological conservatives of the Republican party. It was a bipartisan deal in the sense that Lindsey Graham essentially agreed with all of the Democrats on this.

It would've been a much more productive thing to work out a compromise with someone like Tom Cotton who actually speaks for the sort of, the broader base of conservatives and Republican. But that's the problem is that there are some large fault lines that run right through the Republican Party and the conservative movement, and it doesn't seem like Donald Trump has a hands-on understanding of where they are or how to put them all together. Everyone seems to want to get Donald Trump wins, but that may not be enough.

BAIER: He has his thumbs on his Twitter account. Just in the past minute, "House of Representatives needs to pass government funding bill tonight. So important for our country. Our military needs it." Steve?

STEVE HILTON, FOX NEWS: Look, we are long past overdue for a proper reckoning on all this. I actually find myself somewhat agreeing with Lindsey Graham that we don't need another short-term deal. But I would go much further. We don't need a long-term deal either. What we need is a real deep rethink of the federal government, the whole role of it and the structure of what goes on in Washington, because the reason we are in this endless crisis is that everyone on the Hill are fighting for their piece of the pie. That is driven by the interest that got them there, the unions on the left and the big businesses and big donors on the rise. It is the swamp in action. Everyone is fighting for something. The bigger the pie is, the bigger the fight is.

And the real answer here is to rethink the role of the federal government, to start thinking about what functions could be done better at the state level or even more local than that. I don't see any sign of that happening, but that's the real long-term answer.

BAIER: I guess, Amy, politically in a midterm election year, you have the tax reform law now that is kicking in a lot of states, a lot of companies are funneling money in. Apple with that big announcement. The stock market is cooking. And if the government shuts down, it kind of squelches a little of the politics that's already Republican not friendly.

WALTER: That's right. It really depends on how long, if there is a shutdown how long would it be. Would it really have an impact on the economy. But I think to your broader point is exactly right, which is the fact that Republicans are finally starting to get some momentum. The economy, as you said, cooking along. The president today made a good speech in Pennsylvania making the case for why the economy is doing better and why Republicans should be rewarded for that.

But a lot of the impetus for passing the tax Bill beyond its policy component was for Republicans to prove after failing at repealing Obamacare that indeed they could walk and chew gum. They could pass legislation, they could do things just with Republican votes and that they not dysfunctional.

Now here we have something that is supposed to be easy, keeping the government running. If you can't do the easy stuff, how are we going to get to all this talk about infrastructure and something else big happening between now and the end of the year. It seems impossible.

BAIER: We know that there are a lot of Republicans out there who say shut it down because the government needs to be reformed and all that stuff, but it's not a good thing overall.

This was interesting today, The New York Times today using its editorial page and putting letters from Trump voters who are talking about your one. I hadn't seen that before. And shows a little bit may be of the disconnect of the conventional wisdom that there is going to be this huge Democratic wave. But there are still folks who say, hey, listen, I'm on board.

GOLDBERG: I was very much in favor of what The New York Times did. To me it was sort of a service to their readers because a lot of the regular readers of the New York Times never hear the pro-Trump point of view. And it sort of punctured a hole in the whole thing.

That said, I think it's really very much not in Donald Trump's interest for the government shutdown. I think he could have a very legitimate argument about who deserves blame. It's very difficult to predict it because we've never had a shutdown where one party controlled all three branches of government. I'm totally open to the idea that on the merits, Democrats are to be blamed.

But I think that generally speaking, outside of those people who basically make up 34 percent in the polls, when you have chaos in Washington, when things don't seem to be running right, the media narrative, the Democratic messaging, that runs against Donald Trump's interests. Chaos is going to get blamed on Donald Trump fairly or not. And I think Amy is exactly right. Republicans are getting a little momentum. I think things still look bad for 2018, but why you would want to derail the news about things like this Apple move and the rest is beyond me.

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