White House trade adviser makes the case for tariffs

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White House trade adviser makes the case for tariffs

Peter Navarro on President Trump's trade agenda.

This is a rush transcript from "Fox News Sunday," March 4, 2018. This copy may not be in its final form and may be updated.

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

A wild week in Washington as President Trump splits with conservatives on two fronts.

(BEGIN VIDEOTAPE)

WALLACE: On trade.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: It will be 25 percent steel. It will be 10 percent for aluminum. It will be for a long period of time.

SEN. ORRIN HATCH, R-UTAH: I hope the president doesn't really do this because if he does it's going to be a huge tax on American citizens.

WALLACE: And gun control.

TRUMP: Take the firearms first and then go to court.

SEN. BEN SASSE, R-NEBRASKA: Our government doesn't give us rights. That's not how America works.

WALLACE: We'll discuss the president's policies and disarray in the West Wing with White House trade advisor Peter Navarro, live on "Fox News Sunday."

Plus, the president's embrace of a global trade war sends the markets reeling. Josh Bolten, head of the Business Roundtable of major American CEOs, joins us to sound the alarm.

Then, Vladimir Putin boasts about new Russian weapons he says can penetrate U.S. missile defenses. We'll ask our Sunday panel if we are headed for a new Cold War.

And our power player of the week, country music legend Dolly Parton on giving books to millions of children.

DOLLY PARTON, COUNTRY MUSIC LEGEND: There are many things that I do, this is the one that is nearest and dearest to my heart.

WALLACE: All, right now, on "Fox News Sunday."

(END VIDEOTAPE)

WALLACE: And hello again from Fox News in Washington.

Even in Donald Trump's White House, this has been quite a week. Sudden changes on gun control, a surprise announcement to impose steep tariffs and a staff and turmoil.

This hour, we'll talk about the new tariffs and the potential for a trade war with White House advisor Peter Navarro and Josh Bolten, head of the Business Roundtable, a coalition of top CEOs.

But, first, correspondent Peter Doocy with the latest from the White House.

(BEGIN VIDEOTAPE)

PETER DOOCY, FOX NEWS CORRESPONDENT: Some of President Trump's most loyal allies are dismayed by this week's Oval Office announcement of steep new tariffs on steel and aluminum imports.

HATCH: It's going to discombobulate a lot of our economy here.

DOOCY: The commerce secretary is trying to quiet complaints.

WILBUR ROSS, SECRETARY OF COMMERCE: There's about 3 cents worth of tinplate steel in this can. So, if it goes up 25 percent, that's a tiny fraction of 1 penny.

DOOCY: The president has also been hearing it from governors demanding action on gun control.

UNIDENTIFIED MALE: So, I just suggest we need a little less tweeting here, a little more listening.

DOOCY: As Republican leaders inched toward modest gun control measures, the president had a warning for his own party.

TRUMP: Some of you people are petrified of the NRA. You can't be petrified.

DOOCY: Then he said he had a good meeting with the NRA and seemed to back off with some proposals.

And the West Wing policy debates continue as staffers shuffle or struggle to hold their ground. Jared Kushner security clearance has been downgraded, communications director Hope Hicks is leaving and Attorney General Jeff Sessions was pictured dining with Russia probe leader Rod Rosenstein, hours after the president panned his handling of the FISA abuse scandal.

REP. NANCY PELOSI, D-CALI., HOUSE MINORITY LEADER: If you want to work in the Trump administration, know your blood type because you will be thrown under the bus.

DOOCY: But officials insist this week's real storm in D.C. was the nor'easter.

SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: I left three preschoolers and a bunch of flashlights with the power out at my house. It was pretty chaotic and certainly far more chaotic earlier this morning that when I got to the office.

(END VIDEOTAPE)

DOOCY: The president took a night off from his feud with the mainstream media last night at the Gridiron Dinner to joke with reporters about the week's unflattering headlines. For example, one presidential punch line blamed a delayed arrival at the dinner on Jared Kushner not being able to get through security -- Chris.

WALLACE: Peter Doocy reporting from the White House -- Peter, thanks for that.

The biggest policy development this week is the president's announcement he is imposing a 25 percent tariff on steel imports and 10 percent on aluminum.

Joining us now, one of the architects of that controversial plan, White House trade adviser Peter Navarro.

Mr. Navarro, welcome to "Fox News Sunday."

PETER NAVARRO, WHITE HOUSE TRADE ADVISER: Mr. Wallace, good to be here, my friend.

WALLACE: The blowback to the new tariff policy is intense, especially from conservatives who are -- here are two leading Republican senators.

(BEGIN VIDEO CLIP)

SEN. ORRIN HATCH, R-UTAH: I hope the president doesn't really do this because if he dos at the president doesn't really do this because if he does it's going to -- it's just going to be a huge tax on American citizens.

SEN. BEN SASSE, R-NEBRASKA: If you own a steel mill, today was great for you. If you consume steel, and every American family at the store tonight has something that has different metals in it, today is a bad day for you.

(END VIDEO CLIP)

WALLACE: Are Sasse and Hatch who is the chair of the Senate Finance Committee, are they wrong?

NAVARRO: Of course, they are wrong.

In terms of the Republican Party, let's remember this: Donald Trump ran against 16 Republicans. None of those Republicans supported Donald Trump's positions on trade. He beat every one of them.

And then Donald Trump went on to the Democratic opponent who didn't support his positions on trade and he beat them, too.

What Donald Trump wants to do is fulfill his campaign promises to the American people and defend American workers. And when we here about huge effects here, let's do some of the numbers here. I mean, first of all, the reason why the president is doing this because if he doesn't do this, we were will lose our aluminum steel, aluminum industry very quickly and our steel industry very quickly thereafter.

If you look at the aluminum industry, for example, we are down now to less than 10 percent to fulfilling our demand. With lost six smelters since 2013. We are down to five smelters, only two of them are fully operational. We are operating at a 43 percent capacity factor and only one of those smelters makes the high-purity aluminum we need for our defense --

(CROSSTALK)

WALLACE: Let's unpack some of this. One of the things that both of those senators raised was that this is going to raise prices for American consumers, and the fact is it will. Commerce Secretary Ross estimates that if you take the imported steel that goes into an American built car, it will increase the price of that car $175.

An analyst at the Cato Institute tweeted this. So, a new $175 per vehicle tax times 17 million vehicles sold in the USA in 2017 equals almost $3 billion in new annual consumer taxes, just for steel and autos.

Overall, if I may, sir, if you talk about not just cars but all the products that use imported steel or imported aluminum, we are talking about a tax on American consumers in the billions of dollars.

NAVARRO: I like Secretary Ross' map of a whole lot better. Let's do it for aluminum. If you look at a 10 percent tariff on aluminum, a six-pack of beer or Coke, that's a cent and a half. If you look at the other end of the spectrum, Boeing 777, it's one of the best airliners ever made, it's $330 million aircraft. We are talking but it increased and caused at the worst of $25,000.

So, when you're talking about these massive costs or whatever is in fact, it's not. There are no downstream price effects on our industries that are significant. What we are doing here, and let's be very clear about the mission --

WALLACE: Wait a minute, even -- if it's $175 a car and there are 17,000 cars -- 17 million cars, that is a $3 billion tax.

NAVARRO: I guess we would disagree about how to do that math here, $175 on a $30,000 car is less, a small fraction of 1 percent.

WALLACE: You add it up --

NAVARRO: Now, to get that -- well, you can do that math --

(CROSSTALK)

WALLACE: Wait a minute, sir. If you add it, we are talking billions of dollars in added cost.

NAVARRO: Let's see, last time I checked, we had an $18 trillion economy. It's second (INAUDIBLE) small, there's not enough zeros to get --

(CROSSTALK)

WALLACE: I mean, I know you are a good economist but the fact is we are talking in billions of dollars, correct?

NAVARRO: On a $19 trillion economy. Here --

WALLACE: But you do agree, it's billions of dollars increase in cost?

NAVARRO: What I agree is that the downstream effects of steel and aluminum tariffs are insignificant in the mission here is to preserve our steel and aluminum industries for national security and economic security --

(CROSSTALK)

WALLACE: All right. No, I want to pick up on exactly that point because the president is imposing these new tariffs under Section 232 of the Trade Expansion Act which says that all of this imported steel and all of this imported aluminum, it threatens our national security.

I want to ask you about that.

Here are the countries that we import steel from. Canada is number one with 16 percent of the market. South Korea is number three. Russia is number five. And China is way down at number 11 with only 2 percent of our national steel imports.

Question, how can Canadian imports be a threat to our national security when, for the last quarter-century under law, Canadian imports are -- the Canadian industrial base is considered part of our defense, the American defense industrial base?

NAVARRO: So, let's tackle this in two ways. First of all, let's talk about the 232. When 232 investigation, its national security and economic security broadly defined. In this country, agnostic, it doesn't matter who is sending us this product, the fact is if we keep receiving at the way we are, we're not going to have an aluminum industry, we're not going to have the steel industry.

Our aluminum industry, make no mistake, that thing is on life support. That will be gone in a year or two if the president doesn't take the courageous actions he's proposed. So --

WALLACE: So, let me ask -- let me ask you this, will the president --

NAVARRO: Hang on --

(CROSSTALK)

WALLACE: No, but let me ask you this, will the president --

NAVARRO: You promised, you asked me not to filibuster. I would ask you to do the same thing.

(CROSSTALK)

WALLACE: I'm asking a question. Will the president exempt allies like Canada and Europe?

NAVARRO: On Thursday, which was a great meeting with the CEOs, there was uniform consensus that what the president needed to do was tariffs, not quotas and it needed to be across-the-board. That was the president's announcement, that's the direction it's heading. So, my expectation is that the direction it's heading.

WALLACE: So, in answer to my direct question, will he exempt Canada? Will he exempt the European Union?

NAVARRO: That's not his decision. And so --

WALLACE: Well, I mean, it is his decision.

NAVARRO: Look, you have to understand --

WALLACE: You are saying he's not going to do it?

NAVARRO: You have to understand, Chris: as soon as he starts exempting countries, he has to raise the tariff on everybody else. As soon as he exempts one country, his phone starts ringing from heads of state of other countries.

WALLACE: So, just to make it clear --

NAVARRO: They say, why not me?

WALLACE: It's a global imposition.

NAVARRO: That's an answer.

WALLACE: Global imposition?

NAVARRO: Yes. Yes. And as it should be, because let's think about what the mission is here, OK?

The mission is to defend our steel and aluminum industries so that they survive it and as the president said clearly and correctly, we can't have a country without steel and aluminum industry.

WALLACE: OK --

NAVARRO: Would you grant me this that we are down now to less than 10 percent of meeting production and we're down to five smelters?

WALLACE: I'm just asking the questions, so, let me ask another question.

(CROSSTALK)

NAVARRO: -- just asking the questions.

WALLACE: The other concern is that prices will not just go up, but that other countries will retaliate and slap tariffs on U.S. exports to their countries.

President Trump tweeted this on Friday about responding to U.S. trade deficits with countries: Trade wars are good and easy to win.

And here's what you said.

(BEGIN VIDEO CLIP)

NAVARRO: I don't believe any country in the world is going to retaliate for the simple reason that we are the most lucrative and biggest market in the world.

(END VIDEO CLIP)

WALLACE: Mr. Navarro, do you really believe that?

NAVARRO: Yes, I do. And let's give it some perspective. We have the lowest tariffs in the world. We have the lowest nontariff barriers. We are the free-tradest (ph) nation of the world.

And what do we get for that?

We don't get fair and reciprocal trade. We get every year a half a trillion dollar trade deficit that transfers our wealth to other countries and basically offshore our jobs and our factories. And all we are asking for is fair and reciprocal trade.

Now, in this particular case, we are defending national security, but more broadly, these countries that we are trading with, they understand they'd be getting a very good deal for many years, all the president is doing, he's been saying this for two years now, actually for 20, that America first, we want a fair deal, we want reciprocal trade. And I don't believe, you heard me say this --

(CROSSTALK)

WALLACE: If I may ask a question now, you may -- that may be your argument, but the European Union, for instance, doesn't believe it. They say that they have already assembled a package of tariffs, 25 percent tariffs on $3.5 billion of U.S. exports.

The head of the European Commission said this: We will put tariffs on Harley-Davidson, on bourbon and on blue jeans, Levi's.

Question, is he bluffing?

NAVARRO: Well, they already have tariffs on that. If you go to India, for example, there's 100 percent tariff on our Harleys. But --

WALLACE: I'm asking you about the European Union. Do you believe he is bluffing when he says they're going to impose new tariffs?

NAVARRO: I think what we need to do here -- what we need to do here is keep the rhetoric down. It would be helpful if the media didn't have all these crazy headlines about trade wars, and just look at the facts. Facts are, we are the biggest market in the world.

WALLACE: Wait a minute.

(CROSSTALK)

NAVARRO: -- go no back and forth --

WALLACE: Trade wars are good, it wasn't a media invention. Trade wars are good was a tweet from the president, Mr. Navarro.

(CROSSTALK)

WALLACE: Would you agree that trade wars are good?

NAVARRO: I'm going to finish this argument. And the argument is simply that --

WALLACE: Do you agree that trade wars are good was a tweet by the president?

NAVARRO: I'm going to finish this point. All of the countries in Europe that we trade with run very large trade surpluses with us, we run trade deficits with them. Who gets hurt if this goes the direction that you are suggesting? I believe that these are measured tariffs --

(CROSSTALK)

WALLACE: I am not suggesting anything. I'm asking you questions and I take objection to the idea that talk of trade wars is an invention of the media when the president tweeted out --

NAVARRO: Oh, come on now.

WALLACE: -- trade wars are good and easy to win.

I have limited time.

NAVARRO: You guys are fanning the flames here. What I'm trying to say --

WALLACE: I'm fanning the flames? I didn't write the presidential tweet.

NAVARRO: What I'm trying to say in a measured way is that from the rest of the world's perspective, they are getting a really good deal from America running big trade surpluses with us, and we are asking for is fair and reciprocal trade. In this particular case, I would hope the allies would understand that we need to defend our aluminum and steel --

(CROSSTALK)

WALLACE: I have one final question for you. I think we got the point.

NAVARRO: Go ahead.

WALLACE: To call you trade hard-liner is an understatement. In 2011, you wrote a book called "Death by China" that you then made into a documentary. Here is the trailer for that documentary that shows a knife representing China going into the heart of the United States.

Some White House senior staff accused you of guerrilla warfare, saying that you sneak around the West Wing and go into the Oval Office and runaround policy meetings to personally lobby the president and that frankly a number of senior staff were surprised when the president made this announcement on Thursday.

How do you plead?

NAVARRO: I would say that sitting here on a Sunday with you, that's a bit of a cheap shot, that there's no facts and evidence to support that and if I've learned anything in the 14 months here in Washington on the White House it's that there's all sorts of malicious leaks that go into try to hurt us.

And the culture in the White House now is if they go after one of us, they go after all of us. We are a team together. The president is doing a great job and I stand on my writings.

I can tell you that as the China issue is one that we have the country are going to have to address because it's a serious matter.

WALLACE: Mr. Navarro, thank you. Thanks for your time. Please come back. A spirited discussion.

Up next, reaction from the head of the Business Roundtable on what these tariffs will mean for American jobs in the U.S. economy.

(COMMERCIAL BREAK)

WALLACE: Even before the new Trump tariffs are officially announced, there is fierce pushback to the policy. Some of the loudest alarms are coming from the business roundtable, an association of CEOs from leading U.S. companies.

Joining me now, Josh Bolten, head of the business roundtable and former White House chief of staff under George W. Bush.

Josh, welcome back.

JOSH BOLTEN, CEO & PRESIDENT, BUSINESS ROUNDTABLE: Thank you, Chris.

WALLACE: You were listening to Mr. Navarro. What you think of his defense of the president's new tariffs?

BOLTEN: I think it's a huge mistake and I'm sad that President Bush has been led by that kind of advice.

WALLACE: President Trump. That was loss (ph) of memory there.

BOLTEN: Well, man. Thank you.

President Trump I think is coming at this with the best of instincts. He's trying to fulfill his campaign promises. He's trying to help some workers in the United States, specifically in the steel and aluminum industries.

What he needs to understand and what the overwhelming majority of the businesses in our organization are trying to say is, this will cause huge damage across broad sectors of the economy. You maybe will be able to give a little bit of help to the steel and aluminum industries. You're going to cause damage across any number of downstream industries and any number of industries that export to countries that are likely to retaliate.

WALLACE: But there's no question I think you would agree that the Chinese's over overproduction of steel and their importing to the U.S. -- sometimes not only directly and through other countries has dramatically hurt the steel industry and cost American jobs.

Are you saying the president should just stand there and let it happen?

BOLTEN: No, absolutely not. I mean, the problem is the one you identified, which is state-subsidized overcapacity in China, especially in steel. And that's the issue that ought to be addressed.

Ironically, the announcement that President Trump made this past week hits steel imported from all kinds of countries, most of them are friends and allies, many of them are free trade agreement partners, and hits China only minimally. China accounts for only 2 percent of the U.S. steel imports at this point. So, the remedies that Peter Navarro is pushing the president to impose doesn't address the real problem, which is Chinese overcapacity.

Now, how do you address that? It's really hard. You've got to get together with our friends and allies, who all face the same problem, put pressure on the Chinese jointly, because you can't do this individually, and force the Chinese to reform their practices. But it's not an easy task. It's not as easy as waving your hand and putting tariffs on a whole bunch of countries that are not the problem.

WALLACE: Let's talk about what you say are the downsides of this. Mr. Navarro says that the talk that this is going to increase prices for American consumers is overstated. You know, he talks about a penny on a beer can or $50 on an American car, and he also says the threat of retaliation is overstated.

BOLTEN: Dead wrong on both counts.

First of all, yes, it may be only a penny on a beverage can, but let's be clear: in the United States we make 88 billion beverage cans, aluminum beverage cans per year. That comes out to a tax of $880 million just on beverage cans. And we are talking all kinds of products when you get to cars, when you get to tractors, when you get to airplanes, the cost is really high, making our products uncompetitive against their foreign competitors. That's number one.

Number two on the retaliation point. I mean, Peter Navarro seems to be very comfortable that we won't get retaliated against. I hope he's right. But the history is completely against him on that and the statements of some of our trading partners already is against that.

Now, I don't know if Peter Navarro would be willing to bet his job that he is right that there won't be retaliation, but he ought to be willing to make that bet because he's putting the jobs of tens of thousands of Americans who depend on these export markets that there won't be retaliation.

WALLACE: What --

BOLTEN: And there's a lot of risk that he is wrong.

WALLACE: What are the chances that this escalates into a global trade war? And if so, what with the impact be not just in the U.S. economy, but the global economy?

BOLTEN: Escalation into a trade war is what the businesses in my organization are really worried about. I mean, it's bad enough in the steel and aluminum case, but the tweets by the president, including the tweet about responding on German autos on Friday suggests that he thinks a trade war is easy, that it's winnable.

It isn't. Nobody wins a trade war, especially in these globalized days of the United States when we are so dependent on goods coming in and going out for our competitiveness.

You know, every modern president has faced some trade skirmishes during their time, but they've all been wise enough not to let it descend into outright trade war.

WALLACE: Let me ask you about that, because you do have some experience with this. You are the deputy chief of staff, first, in the Bush White House and 2002, President Bush, Bush 43, imposed steel tariffs of 30 percent on foreign steel imports. Now, he did exempt some countries like Canada, which this president, according to Mr. Navarro, is not going to do. There was retaliation from European Union, and eventually, less than two years later, you rescinded. You lifted the tariffs.

What lesson did you take from that experience into 2002 and `03?

BOLTEN: Well, all of the economic studies that came after that show that we lost more jobs in the downstream industries than we saved in steel. And steel wouldn't be in the problem it would be today if those metrics had been effective.

There's a very important difference between what President Bush did and what President Trump is proposing to do and it's a little bit detailed but bear with me for a second because I think it is very important. President Bush and most trade remedy measures of this kind of been done under section 201, which is a legal procedure accepted in the World Trade Organization which requires going to an independent body, to make a showing of injury. If you succeed in making a showing of serious kind of injury, the products get pared back as they did for President Bush.

And then internationally, that's generally accepted as a way to proceed. Now, the Europeans in that case took us to the WTO. When they won the case, President Bush immediately removed the tariffs and there was no retaliation in that case.

This is completely different. President Trump is proposing to proceed under a statute called Section 232 --

(CROSSTALK)

WALLACE: We talked about that, which is national security.

BOLTEN: National security and a statue that's only been used twice in this country's history to restrain imports from Iran and Libya of oil. That's a real national security.

In this case, even his secretary of defense doesn't think national security is implicated and what that does is it frees up our trading partners to retaliate willy-nilly, which I think they will feel justified in doing.

WALLACE: I got a couple of minutes left I want to squeeze in two questions. I asked Mr. Navarro about the policy process inside the White House and the fact that a number of senior staff people were surprised when the president actually announced the plan on Thursday. They thought there were still discussing it.

As chief of staff in the Bush 43 White House, what do you make of the way this White House operates?

BOLTEN: Well, it's a very different kind of place. I don't -- every White House is -- has its own style. Ours was a particularly disciplined style. The current White House is much less disciplined.

I think John Kelly has brought a substantial amount of coherence to the policy process.

WALLACE: But do you find it, in this issue and others, where a major decision of this import is made and something the senior staff apparently didn't know it was going to happen?

BOLTEN: Yes, that's a serious problem, but I don't think in this case, the problem here is really the process. The problem here is the instincts that the president brought with him from the campaign and you have to respect that. I mean, you have to respect what the president is doing here.

He's had really strong policies on taxes, on regulation, but the third stool of international trade on which he campaigned is weak. And sometimes, a president needs to -- you need to stick to your principles but you also need to recognize in cases where stuff you said in the campaign isn't right and ought to be drawn back. The president needs to have the courage to do that.

WALLACE: Josh, thank you. Thanks for coming in today. We'll follow what the president formally announces this week.

BOLTEN: Great. Thank you.

WALLACE: Up next, we'll bring in our Sunday group to discuss the president's evolving position on guns and school safety, and whether he can strike a deal with Congress to get anything done.

(COMMERCIAL BREAK)

WALLACE: Coming up, President Trump's comments on guns, including whether to raise the age to buy a rifle, worry some conservatives.

(BEGIN VIDEO CLIP)

SEN. PAT TOOMEY, R-PENNSYLVANIA: We didn't address it, Mr. President.

TRUMP: Do you know why? You're afraid of the NRA, right?

TOOMEY: No --

(END VIDEO CLIP)

WALLACE: We'll ask our Sunday panel about the president's changing position on guns, next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: You know, half of you are so afraid of the NRA. There's nothing to be afraid of. And, you know what, I've been -- with you. We have to fight them every once in a while. That's OK.

(END VIDEO CLIP)

WALLACE: President Trump telling the nation's governors not to fear the gun lobby during a White House meeting this week.

And it's time now for our Sunday group. The head of Heritage Action for America, Michael Needham, Gerald Seib from "The Wall Street Journal," former Democratic Congresswoman Jane Harman, director of the Woodrow Wilson Center, and Josh Holmes, Mitch McConnell's former chief of staff and now a GOP strategist.

Michael, how do you explain it? Because the president was almost taunting governors and Republican members of Congress in the two listening sessions this week not to be afraid of the NRA, then he meets with the NRA and he appears to start backing off some of the things he said in those sessions. What happened?

MICHAEL NEEDHAM, CEO, HERITAGE ACTION FOR AMERICA: Yes, look, I think you have a president who wants to get something done. He, like all of us, wants to find a way to increase school safety, to make sure something like this doesn't happen again. I mean sum up what the president said really was unfair. You look at somebody like Senator Toomey and his criticism of Senator Toomey. I've disagreed with the senator on some things in the past. He's somebody who's approached this issue with nothing but the utmost integrity.

What makes this issue so hard pressed as a country is it is one of the flash points in a cultural, civic breaking apart that really does risk tearing our country. You have one half of the country, probably less than half of the country, who literally doesn't understand why somebody would want to have a gun, doesn't understand why somebody would want to use a gun. Then you have another part of the country that looks at it and says, every opportunity that those cultural elites have, they come and they try to take away the rights of law-abiding citizens. I think until we can get to a point where different parts of the country want to talk to each other, want to understand each other and can start finding the types of policies that will actually make a difference, we're never going to be able to have a country where people want to live and talk with each other.

WALLACE: But -- but why would the president add to that by bashing the NRA?

NEEDHAM: Well, I -- I don't know that bashing the NRA is -- is particularly adding to that.

Look, I think this is a president who is new to some of these issues. He ran as an outsider. He hasn't lived the gun battles of the last several decades. He's trying to get to policies that will get something done. In an area that is as big a flash point in the civic breaking apart that is one of the real threats to our democracy and that needs to be addressed.

WALLACE: In his session with the members of Congress, President Trump seemed determined to take guns away from mentally unstable people, like the Parkland shooter. Here the president is.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: It take so long to go to court, to get the due process procedures. I like taking the guns early.

So you can do exactly what you're saying but take the guns first, go through due process second.

(END VIDEO CLIP)

WALLACE: Congresswoman Harman, take the guns first, then go through due process second was kind of extreme, I would think, even for the fiercest gun-control advocates among Democrats?

JANE HARMAN, FORMER U.S. CONGRESSWOMAN, D-CALIFORNIA: Yes.

WALLACE: What are the chances that for all the emotions, when this thing is said and done, nothing meaningful is going to get passed by Congress?

HARMAN: Well, I think they -- they are significant and it's heartbreaking.

WALLACE: Significant chances?

HARMAN: A significant chance that Congress won't be able to do anything.

I would just say it's not a debate between guns and no guns, it's a debate about what level of protection can we give kids in school? How can we take guns away from mentally unstable people, especially assault weapons? And I was in Congress when it did work in 1994. Dianne Feinstein had a bill to ban assault weapons, which passed. Of course the Democrats then lost their majority. Tom Foley, who supported it and was speaker lost, so people were spooked. Ten years later it expired. But I do think something like that, more focus on mental health, certainly --

WALLACE: Why do you think nothing's going to happen?

HARMAN: Because there is no fundamental agreement about what should happen. Even this tiny little bill about registration is stuck because some Democrats want more than that and they think that will be the excuse --

WALLACE: Well, not registration, about -- about filing with the -- don't say registration, but --

HARMAN: Excuse me, about filing, yes.

WALLACE: But fixing -- fixing the national instant criminal background system.

HARMAN: The NICS system. Yes.

WALLACE: Whatever NICS stands for.

HARMAN: Fixing the NICS system.

Not a basketball team.

But the point is that even that is stuck because one side wants more and one side wants less. And can't we get it that our kids are going to go to fortress from now on, or my grandkids are, and that's just the wrong message for kids.

NEEDHAM: I don't think it's fair to say, though, that one side wants less with regards to that. The fix NICS bill could pass if Democrats want it to pass, if Democrats want to make a small step forward.

Senator Rubio gave a great speech this week on the floor of the Senate where he was talking about specific pieces of legislation that have bipartisan support that actually could have prevented this attack from getting something like retraining orders from guns, making it easier for school officials to take people who -- who are known problems and sending them to the cops. We need to get those things done.

I think the question is going to be, does the Democrat Party want to work with Republicans to get things done or do they want the issue? And you had a -- a meeting at the Democratic senatorial campaign at the beginning of this week --

WALLACE: All right, let her answer. I want to bring the other members of the panel in.

HARMAN: All right, so let me just answer. Democrats want to get something done. And -- and piecemeal reform, at least to me, is OK, although we -- I think we should do more.

Governors, fortunately, and the private sector, these gun stores, are moving into the vacuum and I applaud them for doing it.

WALLACE: All right, Gerry, this has always been an unruly White House, but it really did seem to veer out of control this week. Let's put some of this up on the screen.

There were a series of leaks that seemed designed to weaken Jared Kushner. The president called a decision by Attorney General Sessions disgraceful. Economic advisor Gary Cohn is said to be on the verge of resigning over the issue of tariffs. And the president, according to some reports, wants his national security advisor, General McMaster, out.

What is going on?

GERALD F. SEIB, THE WALL STREET JOURNAL: Well, so other than that, it was a great week.

So, look, I -- I think that -- that there is a reality about this White House, I've talked to some people who work in the White House about it, which is that you're not going to change the way President Trump operates. He -- this is the way he is. And so I think it's a mistake to try to have a staff structure that is designed to change him. I think what you have to do is have a staff structure that works around the way he operates.

And it seemed to be in place for a while. But Rob Porter, who was the staff secretary, who helped control things a lot, is -- is gone. General Kelly, who had seemed to have instilled some order, has now found himself feuding with Jared Kushner. That has created its own set of chaos. And I think you also have the reality that some of the top issues that have been bubbling along have now come to the surface.

Trade, for example, which you just had some very interesting conversations on, was always going to split the White House staff. I mean that was below the surface. Gary Cohn is here. Peter Navarro is there. There's no getting around that when you get to the point where you want to act. And that was -- actually the most amazing thing that happened this week was this decision by the president to announce on his own, on the fly, that he was going to impose tariffs on trade and aluminum imports because the staff at been telling people, you know, just an hour earlier, it's not going to happen.

So, when you bring that sort of question to the surface, you're going to see the splits. So you can't keep them hidden any longer.

WALLACE: Josh, how much concern among top Republicans in this town, I'm mostly talking about in the building behind me, about staff disarray and policy disarray in the White House?

JOSH HOLMES, FOUNDER, CAVALRY: Well, I think the second piece is -- is the most important to that because the -- the -- largely the palace intrigue is something the media has been obsessed with since day one in any administration. And this administration is no different. It seems to be more of a central thesis with this administration than previous administrations. But I think, in terms of Congress, the only time they care about this is when it affects the policy. And I think this week was the first week in many, many months going back to probably July of last year that it did. And we saw that with the rollout of this -- of these trade proposals. A lot of misunderstanding about what they actually were and a lack of consensus internally.

That is a problem because Congress reacts only and exclusively to consistency from the administration. You've got to remember, there are 535 different opinions up there. At least 200 of them wake up every morning and look at the mirror and see the new president of the United States. They all have their own individual opinions. And so they need consistency from the administration to help guide their view.

WALLACE: All right, panel, we have to take a break here. But when we come back, we'll discuss Vladimir Putin's announcement, Russia has new, invincible missiles that can penetrate U.S. defenses.

Plus, what would you like to ask the panel about prospects for a new Cold War? Just go to FaceBook or Twitter @foxnewssunday and we may use your question on the air.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

VLADIMIR PUTIN, RUSSIAN PRESIDENT (through translator): Russia was and remains a big nuclear state. But, no, no one wanted to speak with us constructively. No one has listened to us. You listen to us now.

(END VIDEO CLIP)

WALLACE: Russian President Vladimir Putin with an ominous warning after announcing a new generation of nuclear weapons.

And we're back now with the panel.

Congresswoman Harman, how important was Putin's announcement? Do we think he really has these weapons? And, if so, does -- how does it change our relations with Russia? Are we headed for a new Cold War?

HARMAN: Well, let's focus on the fact that there's an election in two weeks in Russia. Vladimir Putin's essentially unopposed, but it wouldn't hurt to put out a big campaign speech, which he did very effectively.

On the weapons themselves, some of its new, some of it isn't new. The footage he used, or a lot of it, was from a 2007 Russian documentary which has been on YouTube since 2011. So that's clearly not new.

And talking about his ability to be invincible, well, not so much, but -- but cruise missiles are much harder to defend against than missiles that have a -- a parabola that goes up and then comes down. That's what our defenses are geared for.

WALLACE: But what -- but on the -- on the real issue, I mean this clearly -- I mean the animation actually showed the missile headed towards North America. I mean what does this say about U.S.-Russian relations?

HARMAN: Well, it -- it says saber rattling. It say, my button is bigger than your button and all of that. We -- we've seen that movie recently. And we also should worry about Russia transferring technology to other countries. We've just learned that Russia has been laundering coal from North Korea to other places. So, not so good.

But what I wanted to say was, there is a missile defense review underway. We should do more with our missile defenses. They're never going to be perfect. Russia could overwhelm us. But we could overwhelm them.

And as to a new Cold War, I don't think so. I think the world is multi-pollard (ph). It's a very different world now. But what happened to the vision that Ronald Reagan had about a shining city on a hill. Not just being tough on defense, which we should be, but where's the vision for America and our role in the world? That we could do.

WALLACE: We asked you for questions for the panel and we got this on Twitter from Alex Atmore. Wouldn't imposing the sanctions that Congress approved of near unanimously be a good deterrent without further escalation?

Josh, how do you answer Alex?

HOLMES: Well, it's a great question. And, you know, the irony of this administration and how they've dealt with sanctions is actually only fueled the greater speculation about all of the election of 2016 and all of the investigation that have gone into it had they implemented the sanctions, I think, without any question, they would be in a much different situation with respect to the investigations.

So, look, I -- what we're doing currently is clearly not working. You had DNI Director Coats out, you had CIA Director Pompeo out, all saying we're not doing enough to deter Russia, particularly with respect to our elections and the midterms coming up. And so I've talked to a number of members of Congress. They all think that we've spent far too much time talking about 2016 elections, not nearly enough talk about 2018 elections and it's time that we turn the page and address some of that.

WALLACE: Well, as a matter of fact, that brings us to a hearing on Capitol Hill this week were Senator Elizabeth Warren was questioning the head of the National Security Agency, Admiral Rogers, Mike Rogers, about given what happened in 2016 with Russian modeling, what about the dangers to 2018. Here he is.

(BEGIN VIDEO CLIP)

ADMIRAL MICHAEL ROGERS, DIRECTOR, NATIONAL SECURITY AGENCY: My concern is, I believe that President Putin has clearly come to the conclusion, there's little price to play here.

SEN. ELIZABETH WARREN (D), MASSACHUSETTS: Bingo.

ROGERS: And that therefore I can continue this activity.

WARREN: Yes.

(END VIDEO CLIP)

WALLACE: Michael, has President Trump been tough enough in -- forget 2016, let's just put that in a box for a minute. Has he been tough enough in saying to Vladimir Putin and the Kremlin, hands off this country in the 2018 elections?

NEEDHAM: He should be very clear about that. And we need to protect our critical infrastructure and he should never miss an opportunity to make it clear how much, and we're committed to that.

Look, I think writ large American foreign policy towards Russia for a long time has been a little bit naive and I think that the Trump administration writ large has been bringing it together into a very coherent national security strategy that they put out there that needs to be more aggressive in looking at how we're dealing with the Russian threat, recognizing that Vladimir Putin is not backing down, he's doubling down and it's going to take a unified national response from our nuclear postural review, from our relationship with Ukraine, from our relationship with the sanctions that you brought up.

I think the Trump administration has done a very good job of taking our foreign policy, unifying it around themes, backing up our allies, being more aggressive towards Russia. But, clearly, there's more that we need to do to make it clear that election meddling is not something that we're going to tolerate.

WALLACE: You're shaking your head, congresswoman.

HARMAN: I -- I -- I think it has -- the Trump administration has no coherent world strategy and I don't think the Obama administration did either.

NEEDHAM: Yes.

HARMAN: But now is the time. Our election is very vulnerable in 2018, and so are Europe's elections. And targeted sanctions that hit individuals and prevent them from traveling and prevent them from using international banks would make a huge difference in Russia, and I think Trump missed an opportunity by just putting out there the Fortune 500 list and not doing anything. I think that was a strategic blunder.

NEEDHAM: And I think this is something the Democrats and Republicans are going to have to come together and say, on this one, we need to be unified.

HARMAN: Right.

NEEDHAM: I mean if you look at the nuclear posture review, what President Trump put out in 2018 is very different from what President Obama put out in 2010, but it's not really that different from what he was doing at the end of his administration. I think that there is more bipartisan consensus that we need to come together on some of those issues that he needs to continue.

WALLACE: But -- but, Gerry, let me bring you in, because there's been almost silence from this administration after a very provocative speech by Vladimir Putin, the president said nothing, the White House basically said nothing. There's been no response from this administration.

SEIB: Well, look, I -- I think there's a -- an unfortunate reality here, which is that the -- the debate about the 2016 election, which has consumed this conversation about Russia, is probably something, if you could do what you just suggested, put it in a box and get onto the broader realities here, that would be healthy. That's not happening. I think it's not happening in part because both ends of Pennsylvania Avenue are obsessed with what happened in 2016.

But the deeper reality here is that democracy is -- is under attack. And not just from Russia and not just in 2016. It happened in Europe in 2014, 2015, 2016. It happened here. It's apparently happening here now. Both the Russians, Vladimir Putin, and President Xi in China, would like to hold out other models besides democracy as the model that other countries in the world ought to follow.

There's a really sustained attack on the -- basically the institutions in -- of democracy and its role as a model for the world. And that's the broader issue here. And it's now being basically lost as a question that ought to be discussed because of this obsession with 2016. And I don't know how you break out of that.

WALLACE: Well, let -- and -- and let's end of that, because it isn't in a box. It's, you know, it's on the front page of the papers today again.

SEIB: Right.

WALLACE: I think sometimes the -- the incremental information we hear is significant. Sometimes I think it's meaningless. You know, Robert Mueller is asking about -- well, he's asking about everything.

What is the price, the opportunity cost of this? Obviously it has to be investigated. But of this continuing -- now we are a year and a third into this administration --

SEIB: Well, I think it's obvious that the -- the kind of broader issues we're talking about here don't get raised, don't get discussed.

But at some point the Robert Mueller thing comes to an end. I don't know what the end point is, but at some point later this year, I assume, it will be reached and then we'll know the answer to some questions and maybe then we'll move on to the broader questions.

HOLMES: Well, and you asked what the price is. I mean imagine just for a moment in the midterms, let's say, the state of Ohio or the state of Florida all of a sudden can't trust the integrity of its ballots that were just cast.

SEIB: Right. Yes.

HOMES: I mean that is a fundamental undermining of the American democracy. That's what the price is.

HARMAN: Which is huge. And -- and the -- sadly Congress could act on a bipartisan basis in many areas. Immigration, obviously this issue about meddling. Election -- securing our election infrastructure in -- on a -- on a more sustained basis, and it doesn't do it.

WALLACE: All right, thank you, panel. See you next Sunday.

Up next, our "Power Player of the Week." Dolly Parton on why kids around the world call her the book lady.

(COMMERCIAL BREAK)

WALLACE: Most of us know her as a legendary singer and songwriter, but for millions of kids, she's the one who help them start reading early.

Here is our "Power Player of the Week."

(BEGIN VIDEOTAPE)

DOLLY PARTON, FOUNDER, IMAGINATION LIBRARY: I just always thought there was magic in books because it takes you to other places. Anywhere you want to go, you can find it in a book.

It says Dolly Parton, that's my name.

WALLACE (voice over): The Library of Congress is not the first place you'd expect to see Dolly Parton, but there she was celebrating her love of books.

PARTON (singing): In my Tennessee mountain home --

WALLACE: It's a story that begins back when she was growing up, one of 12 children, in the Smoky Mountains of east Tennessee, the daughter of Robert Lee Parton.

PARTON: Daddy never had a chance to go to school. And daddy couldn't read nor write, but he was really a smart person enough and wondered what all he might have done had he had an education.

WALLACE: Fast-forward to 1995, when the country music star decided to start the Imagination Library, to give free books to children in her hometown.

Over the years, the program has spread across the country and overseas. A book every month to kids who sign up from birth until they turn five and go to kindergarten.

WALLACE (on camera): What does it mean to a child to get their own book mailed to them in their own name?

PARTON: It makes them feel important. It makes them feel special. So, of course, it makes them want to do what the book is all about, learn to read it.

WALLACE (voice over): Local communities pay for the books, but Dolly's group pays for sending out more than a million a month, which she helps cover through her companies and concerts and even a children's album.

PARTON (singing): I am a rainbow.

PARTON: Oh, millions of dollars, I'm sure.

WALLACE (on camera): And it's that important to you?

PARTON: Oh, it's very important, because it's my charity. Although there are many things that I do, this is the one that's nearest and dearest to my heart.

WALLACE (voice over): Dolly has been performing for more than 60 years. She's won eight Grammy's and is in the Country Music Hall of Fame. But she shows no sign at all of slowing down.

PARTON: My music is everything to me. It's my gift. It's my joy. It's my job. And it's just something that I love to do. And I never think about that I should quit it.

WALLACE: Which brings us back to the Imagination Library.

WALLACE (on camera): Though I understand that you have gotten a nickname from this program.

PARTON: I'm the book lady. Who knew?

UNIDENTIFIED FEMALE: And we are so honored that the hundred millionth book --

WALLACE (voice over): So there was Dolly with the librarian of Congress donating the 100 millionth book, unveiling a copy of her own coat of many colors, based on the coat a her mother made for her out of scraps of cloth.

PARTON: Maybe we'll be back for our billionth book one of these days.

UNIDENTIFIED FEMALE: All right.

PARTON: Wouldn't that be nice!

WALLACE (on camera): What does it mean to you, Library of Congress?

PARTON: I know. Here I am. A little old country girl from the Smoky Mountains of east Tennessee. Now one of my little books about my mom and a story about my dad is going to be here forever in the Library of Congress.

WALLACE (voice over): Dolly even gave us a little concert about the coat and her family and what led her to share her dream with so many children.

PARTON (singing): In my coat of many colors that my mama made for me, made only from rags but I wore it so proudly. And although we had no money, I was rich as I could be, in my coat of many colors mama made for me, because she made it just for me.

(END VIDEOTAPE)

WALLACE: That was a treat.

Dolly's Imagination Library will now team up with a Library of Congress for a special story time for kids, the last Friday of each month streaming online. To learn more, please go to our website, foxnewssunday.com.

Now this program note. Be sure to tune into your local Fox station tonight at 7:00 p.m. Eastern for "Billy Graham: An Extraordinary Journey." The story of America's preacher who was laid to rest on Friday.

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

END

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