Trump: Sony has 'no courage, no guts ... it's extortion'

Donald Trump warns North Korean hack attack on Sony is a 'whole new form of warfare.'

This is a rush transcript from "On the Record," December 18, 2014. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Donald Trump joins us.

Good evening, Donald. You say Sony has no courage and no guts. What do you mean?

DONALD TRUMP, CEO, TRUMP ENTERPRISES (Via Phone): Look, number one, there are always two sides of a story but it really gets to a point it is extortion. They are saying things and doing things. And I think the bigger problem is if North Korea, who we think of as being very backward, and, yet, they are sort of like working on nuclear, but if North Korea has this kind of power, that they can do things on the Internet that we have no idea what's happening, that is not a good thing. They seem to be pretty sophisticated, moreso than people would have thought.

But the second side of the story is the movie is terrible, supposedly, according to the critics. And they are talking about the assassination of that country's leader and in not a nice fashion. What they are saying happens to him is brutal. And you know, if somebody took our president or our leaders and put that into a movie, I don't think our country would be very happy with it either, Greta.

VAN SUSTEREN: You know, it's interesting though -- I guess interesting is the wrong word to use. But this looks like the beginning of guerrilla cyber warfare. Most countries have had the capability to do damage to other countries but everybody has sort of held off. Now all a sudden, somebody has not held off. How do we respond? Should Sony respond? The U.S. government respond? What should we do?

TRUMP: I have been saying for a long time, you know, the Internet and the whole computer age is really a mixed bag. It makes life easier in some ways but in a lot of ways it makes it much more complex. I have an 8-year- old son who frankly is so good with the computer it's incredible. I have never seen anything like it. And you know the kids are getting better and better. And people are getting better and better. And I don't think you can keep secrets anymore.

You know, in the old days if you are fighting a war, they have a sealed envelope that is brought over by a whole group of very powerful military people and it's put into a safe. Now, you put something out over the Internet, you don't know who is reading it or who is watching it. So, we're in a different age. But, you know, the computers are a mixed bag. There is no question about it.

VAN SUSTEREN: But, Donald, this may be different. One thing we have to worry about, we have to worry about the power grid and we have to worry about the banking system, we have to worry about Social Security numbers. Do we just -- now that this has been done -- this is the first severe strike, cyber warfare against a big corporation. Should something be done? Should somehow we respond, whether it's Sony itself or the Obama administration?

TRUMP: I think this is just the beginning, Greta, from what everything and what everybody tells me that really is well versed. This could be just the beginning. This could be a whole different form of warfare in a sense. It's pretty frightening when North Korea seems to have a power that we don't understand because, right now, our people don't understand how this happened.

VAN SUSTEREN: So what do we do?

TRUMP: I guess we just have to be smarter than everybody else. And maybe we have to wean ourself a little bit off the Internet. To a certain extent, we may have to wean ourself off computers and go back to the old- fashioned way to a certain extent, because there is no safety or security with computers. People can break codes. They can break all sorts of any kind of -- any kind of check, they seem to be able to break. It's not only happening with Sony, it's happening with many other people. At what point --

(CROSSTALK)

VAN SUSTEREN: I'm surprised at you saying that, Donald. I'm actually surprised. It sounds like you are saying we should change back down, or whatever, you know, rather than try to sort of get -- you know, teach whoever the offender is. We're still trying to find out who did. This, rather than try to sort of nip it in the bud and send a message this won't be tolerated, you think we should just change?

TRUMP: Greta, I'm saying, for a long period of time, things that come out on the Internet that people think are totally protected are not. Look at the email. Look at the whole email situation. Other than the IRS, once you give an email, that email is there forever and ever. And you can always find it. The IRS, of course, was different because something happened that was terrible there. How they got away with that one is really rather amazing. But, other than that, the fact is we have no security. So we're going to have to do something. We're going to have to be a lot smarter than we are right now.

But when it comes to security, you are note getting it on the Internet and you are not getting it through computers anymore.