KELLY FILE

Rep. King: Canceled Russia intel briefing is 'disgraceful'; Conway on Russia and intel briefs, Trump business interests

This is a rush transcript from "The Kelly File," December 14, 2016. This copy may not be in its final form and may be updated.

MEGYN KELLY, HOST: We have a big story breaking tonight as an increasingly tense fight takes an ugly new turn. With U.S. spy agencies now refusing to share the Intel being used to attack the legitimacy of the 2016 election, to some extent.

Good evening. And welcome to "The Kelly File" everyone. I'm Megyn Kelly.  The battle over the alleged Russian interference in the 2016 election took a couple of explosive turns in the last 24 hours. First, the Republicans started questioning why they were seeing media stories of Russian involvement that went well beyond what they had been told by these agencies. Then the House Intel Committee demanded an emergency hearing with the CIA, the FBI, the National Security Agency to figure out what's going on here.

And now tonight just hours ago, Republicans forced to cancel that hearing when the Intel agencies refused to cooperate. Saying they would not be sending any briefers in. In just a moment, we will have reaction from Congressman Peter King of the Homeland Security Committee.

But we begin tonight with our chief intelligence correspondent Catherine Herridge who has had a busy day in Washington. Catherine?

CATHERINE HERRIDGE, FOX NEWS CHIEF INTELLIGENCE CORRESPONDENT: Well, thank you, Megyn. Late today the Republican chairman of the House Intelligence Committee issuing this statement after the CIA said the agency would not send a briefer to Capitol Hill to deconflict reports about Russia's alleged interference in November's election. Congressman Devin Nunes of California writes, "The committee is deeply concerned that intransigents in sharing intelligence of Congress can enable the manipulation of intelligence for political purposes. The committee will continue its efforts and will insist that we receive all the necessary cooperation from the relevant leaders of the Intelligence Community.

The classified briefing Thursday on the hill was going to focus on whether there is new intelligence or analysis that concludes the Russian President Vladimir Putin authorized the cyber activity to endure a Trump victory.  The CIA told the House Committee it was too busy with the President's review to help. A former intelligence officers tells FOX News that knowing the Russian leaders intent would be challenging.

(BEGIN VIDEO CLIP)

LT. COL. TONY SHAFFER (RET), FORMER INTELLIGENCE OFFICER: If you're going after a leadership target, you have to have someone next to that leader so the idea of finding out intent has to be clearly defined and based on having a human intelligence asset, a spy, inside of the very circle you're trying to collect on.

(END VIDEO CLIP)

HERRIDGE: With at least four investigations on Capitol Hill and the full review requested by President Obama, a former senior intelligence officer said the probes are creating a paper trail that will make it harder for Mr. Trump and the Russian president to build a close relationship after January 20th -- Megyn.

KELLY: Hmm. Catherine, thank you.

HERRIDGE: You're welcome.

KELLY: Joining me now with more, New York Congressman Peter King, member of the Homeland Security Committee and Permanent Select Committee on Intelligence.

Congressman, good to see you tonight. So, what does that tell you that these agencies have refused Congress' demands that they show up and share the Intel?

REP. PETER KING, R-N.Y., HOMELAND SECURITY COMMITTEE: Megyn, this is absolutely disgraceful. All we have heard from the Intelligence Community over the last several months is that they could not say that there was any attempt to undermine Hillary Clinton to help Donald Trump. The consensus was that there was an attempt by the Russians to put the cloud over the election. To create this unity. Well, that's what is happening right now.  And as the intelligence community is doing it, there was nothing at all ever told to us.

In fact, they said, they couldn't prove it, that there was an attempt to favor one candidate over the other. Director Clapper, the director of National Intelligence said that publicly on November 17th. And now we have, as far as I know, there is no decision by the CIA. There is no consensus opinion. And yet we find it in the "New York Times," in the "Washington Post" and yet the House Committee on Intelligence was told nothing about this.

And yet it's our committee, it's Devin Nunes, who has jurisdiction over the CIA at all the intelligence agency. This violates all protocols and it's almost as if people in the Intelligence community are carrying out a disinformation campaign against the President-Elect of the United States.  It is absolutely disgraceful. And if they're not doing it, then it must be someone in the House or the Senate who is leaking false information. And there should be a full investigation of this.

KELLY: So you're telling me that when the Washington Post had this report on Friday citing anonymous sources saying that the CIA has determined Russia, interfered in the election with the purpose of helping Trump's campaign.

KING: Right.

KELLY: That was the first you heard of it from the Washington Post. And now this would be your next and best attempt to get the CIA to come before you and you have oversight responsibility over them to tell you what they know and you've been refused?

KING: Absolutely. They absolutely refuse. They won't be there tomorrow.  They have somebody -- time to leak it to the Washington Post and the New York Times but they don't have time to come to Congress and it's the House Committee on Intelligence that has the absolute jurisdiction over the CIA and the Intelligence Community.

KELLY: You don't believe that. That we're too busy to help you right now because we're busy helping President Obama. You don't believe that.

KING: No. It's their job. It's their job to come. They don't have any choice. They have to come in. So they, and especially when they have created this, the week before the Electoral College is meeting and someone in this --

KELLY: So, what are they doing? What are they doing? Why? I mean, it is tough to believe they don't have time. It is a big agency. They can't find one person to go speak to the Congress who represents us for oversight purposes? So why would they be playing this game and refusing to appear before you?

KING: Well, first of all, I don't think there is any conclusion that they are attempting to favor Donald Trump over Hillary Clinton. Who is the CIA?  When they say the CIA has made this conclusion, who? Is that Brennan? Who in the CIA has done this? There is no finding that we've got and there is no assessment that we've seen. If they had, they had an obligation to show it to us. Maybe there is none. This could be a whole house of cards. I see this as some type of disinformation to discredit the incoming President-Elect and that's absolutely disgraceful. First of all, it shouldn't have gone to him.

KELLY: That's quite an accusation. I mean, these are spies who risk their lives to protect us, I mean, that's -- General Michael Hayden was out yesterday saying, look, this kind of thing, these guys put their lives on the line.

KING: Right.

KELLY: And what he said was, the CIA director said, people are in a harm's way to learn things otherwise unavailable.

KING: Right.

KELLY: And if what is gained is not used or wanted or labor the suspect are corrupt by what moral authority does a director put his people at risk.  That's from the former head of the CIA. Do you go too far in accusing them of intentionally engaging in a disinformation campaign?

KING: I'm saying there is someone there who is leaking this out. Why they didn't tell the House Intelligence Committee? That's their obligation.  Why they didn't tell the House Intelligence Committee, if something so dramatic happened between November 17th and this week to change their assessment, didn't they have the obligation to come before the Congress and tell us that? We're the ones with jurisdiction. Devin Nunes is the one they should have gone too. Somebody. Devin Nunes or again, Speaker of the House.

They have an obligation do that. And then to come out with this to say the CIA has this but nobody in the CIA is speaking, no one is on the record, no one at all is on the record. And so if it is true, they are leaking it.  And that's a crime. If somebody is making it up then that's also -- this stinks. It really does. It is wrong and listen, this could well be the conclusion sometimes. If it is, they have to do it in a proper way. They have not done it. And so far I think this is disgraceful what's happened.

KELLY: Wow. Extraordinary. Congressman King, great to see you. Thank you, sir.

KING: And let me say, 99 percent of the people in the CIA are great. But somebody here though was behind something that's totally responsible.

KELLY: Great to see you.

Well, as Congressman King just mentioned, wow! In just five day, the 2016 election result will be finalized when members of the Electoral College actually cast their ballots for president. You thought you cast the ballot for president but you didn't. You voted for this electors but nobody knows.

Well, they're supposed to vote for the candidate who won the popular vote in their respective states. And if they do, then Mr. Trump wins with 306 Electoral College votes to Clinton's 232. But the electors are not necessarily force to vote that way in an unprecedented development, powerful Democrats are joining with members of the Electoral College to raise the possibility that they may seek to overturn the election over these allegations that Mr. Trump got a helping hand from the Russians.  Again, allegations.

Trace Gallagher picks up the story from there. Trace?

TRACE GALLAGHER, FOX NEWS HOST: And Megyn, because Donald Trump won 306 Electoral College votes to change the outcome, anti-Trump activists would need to convince 37 Republican electors to vote against him. Harvard Constitutional Law Professor Larry Lessig himself have briefed Democratic presidential candidates says, he knows of 20 GOP electors who are considering ditching Trump. He is even offering them free legal counsel which could come in handy considering 29 states, including 14 that voted for Trump, have laws that bind electors to the candidate who won.

Professor Lessig has offered no evidence to back up his claim which is being directly contradicted by the Republican National Committee and state GOP committees who say that only one GOP elector, Chris Suprun of Texas, has revealed his intention to vote against Trump. State and national GOP leaders have also been in constant contact with Republican electors to make sure they lock down their votes. Although, Democratic operatives are still actively trying to sway those people. But even GOP electors who have criticized Donald Trump say they will still vote for him.

Because they would never dream of disenfranchising their state's voters.  And now there are 50 of the so-called Hamilton electors. There were 10.  Hamilton, by the way, is a reference to Alexander Hamilton who said in the Federalist Papers that the President must be elected without undue foreign influence. Those electors all Democrats except one are still asking National Intelligence Director James Clapper for a briefing on Russian interference in the election. Outgoing Senate Minority Leader Harry Reid says they deserve that briefing. There is no indication they will get it.  And for the record, the most electors to ever reject a President-elect was in 1808 when six turned against James Madison -- Megyn.

KELLY: Six, all right, Trace, thank you. Joining me now, excuse me -- FOX News digital politics editor Chris Stirewalt. I'm getting over this hideous illness. It's a miracle I'm hearing.

(LAUGHTER)

CHRIS STIREWALT, FOX NEWS DIGITAL POLITICS EDITOR: You mean the election?

KELLY: So far. They almost got any (INAUDIBLE) tonight, Stirewalt. They actually spent money on my chair but it failed already. Good to see you.

STIREWALT: And you.

KELLY: So, six electoral votes a hundred plus years ago. Now they say they may, maybe best case scenario have 20. Which leads their effort exactly where?

STIREWALT: Well, not to disagree with Professor Gallagher, but in 1876, they actually overturned the Electoral College. The Electoral College went cablooey because there were disputed totals.

(CROSSTALK)

STIREWALT: Yes. Yes. But no, this is important. Because the reason that the Electoral College went cablooey in 1876 between Samuel Tillman and Rutherford B. Hayes --

KELLY: Oh my God!

STIREWALT: -- was that there was a massive fight over whether the votes were legitimate. That's why they blew up the Electoral College. That's why they needed a special commission. It's because there was something wrong with the votes. In this case, there is a complaint that Russians were involved in the campaign but there is no allegation anywhere. No person, not the frothiest Clintonista of all of the frothiest Clintonistas as said that the Russians did anything to the vote --

KELLY: Right.

STIREWALT: -- to the machines, to the totals. Where this is coming from is --

KELLY: They're saying it was a mind meld, getting in people's heads about Hillary being bad because of those WikiLeaks and so on beforehand. I don't know how you quantify that or translate it into an undoing of the election and I don't know what the Democrats theory is on it either, Chris. I mean, you tell me. Tell the viewers what would happen if they had, you know, these unfaithful electors who went in there and actually tried to hand the election to Hillary Clinton. Then what happens?

STIREWALT: Well, if these folks had their way, and there were 37 people who voted not for Donald Trump, they would all have to vote for Hillary Clinton. If they didn't all vote for Hillary Clinton, Donald Trump would be just under 270. They would send it to the House of Representatives and he would still be the President anyway. They are selling snake oil. They are selling false hope to Democrats. Oh, one more time. One more time to try to stop Trump. And by the way, de-legitimize him as he goes into his presidency.

When Donald Trump said that the election was rigged and that the votes would be stolen from him if he lost, it would be because the votes were stolen, that was playing recklessly with our system of elections. And Hillary Clinton called him on it. And Hillary Clinton said, that was a bad idea.

KELLY: Yes.

STIREWALT: Now we get to the point, Democrats are doing the same thing and they ought to be ashamed of themselves. Because we need these institutions to work in order to have this Republic function.

KELLY: Yes. No matter how disappointed they maybe. I mean, the Republicans were disappointed when Barack Obama won twice but this stuff didn't take place.

STIREWALT: Yes.

KELLY: You know, there are grapes and they may be very sour, but they're going to have to eat them.

STIREWALT: Right. You have to still tip the glass.

KELLY: Chris, it's great to see you.

STIREWALT: You bet.

KELLY: So, up next, we're going to take up this breaking news that we just got to with the CIA and other Intel agencies saying, hmm to Congress. With Kellyanne Conway who is here. She's senior advisor to the Trump Transition team. And we will ask her, are some in the Intel community playing politics here?

Plus, the incoming White House chief-of-staff suggesting the new administration will be shaking up the traditional relationship with the media.

Former White House Press Secretary Dana Perino is here along with former Trump campaign spokesperson Katrina Pierson who is rumored to be on the very short list as Trump's potential press secretary. They are both here on what to expect.

(COMMERCIAL BREAK)

KELLY: Breaking tonight, with the President-Elect moving closer and closer to the White House, meetings at Trump Tower are ramping up. Today, President-elect Trump sat down with the heads of Amazon, Apple, Facebook and a number of other tech giants with the notable and perhaps ironic exception of twitter. Can you believe?

We have Presidential Transition Team insider Kellyanne Conway here tonight on the very latest. But first, our chief White House correspondent John Roberts gets us up to speed. John?

JOHN ROBERTS, FOX NEWS CHIEF WHITE HOUSE CORRESPONDENT: Megyn, good evening to you. And the official on background reason why Twitter was not invited to this tech summit today, quote, "They are not big enough." This was the highest profile summit to take place so far since the election at Trump Tower. The highest dollar as well. Donald Trump getting together with a room full of high-tech billionaires. Most of whom in the room actively campaigned against him. They're raising a lot of money for Hillary Clinton during the election campaign.

We don't know how they felt about the meeting because none of them would stop and talk to the press pool on their way out but here's the basic case that Donald Trump made. He wants to be all about jobs and growing the economy. And feels if everyone is pulling in the same direction there's a much better chance that the economy will grow and more jobs will be created. And these high-tech billionaires also have a lot of stake with the Trump presidency too because they have billions of dollars stashed overseas. That they can't bring back unless they want to pay high taxes on it.

So, he is going to allow them if he gets his way to repatriate that money to much lower rate, he would cut the corporate tax rates to 15 percent. He also said when he started the meeting, hey, if you look at this high tech stocks, they've been doing pretty well since he was elected back on November the 8th. Listen to Trump.

(BEGIN VIDEO CLIP)

PRESIDENT-ELECT DONALD TRUMP: You're doing well right now. And I'm very honored by the bounce. They are all talking about the bounce. So right now everybody in this room has to like me at least a little bit. But we're going to try and have that bounce continue. And perhaps even more importantly, we want you to keep going with the incredible innovation.

(END VIDEO CLIP)

ROBERTS: So now the latest on where Trump is with his campaign picks, he's got Ryan Zike that he is going to be announcing for the next couple for days for interior. That leaves agriculture and veterans affairs. His top pick for agriculture right now is the Democratic senator from North Dakota Heidi Heitkamp, but she is getting her arms twisted and perhaps being threatened with kneecapping by a lot of Democrats who say, if you go take this job it's likely that they are going to put a Republican in your place.

So she might not take it. Second pick is the congresswoman from South Dakota Kristi Noem, but she has said that she doesn't want the job.  Veterans Affairs is proving to be particularly thorny. They don't yet have a really, really strong candidate. So we might not hear about these Megyn for the next couple of days or maybe even a couple of weeks. Back to you.

KELLY: John, thank you.

So, we haven't heard anything so far from team Trump about this new fight between Republican leaders and the Intel agencies suggesting there is Russian interference in the election to benefit Donald Trump. But fortunately we have Kellyanne Conway with us tonight so we can ask her live. Kellyanne, great to see you.

KELLYANNE CONWAY, SENIOR ADVISER, TRUMP TRANSITION TEAM: Thank you, Megyn.

KELLY: What do you make of the fact that this CIA and other spy agencies basically thumbed their nose at their Congressional oversight leaders who are supposed to be there for us to keep an eye on them when it comes to this assertion that leaked out to the Washington Post on Friday?

CONWAY: We should all be very concerned about that. Because you had a closed door House Intelligence Committee briefing and no sooner did people walk out apparently than some folks were talking to the media. That is unfortunate and at some level maybe not in this instance Megyn, but at some point it could put all of us at risk. And for what purpose? To politicize or to carry favor with the mainstream media? None of that is worth leaking secrets.

KELLY: Do you think that is what they're doing? This is what I was trying to do with Congressman King.

CONWAY: Yes.

KELLY: The notion that, you know, the CIA is doing anything other than working to protect us would sound very foreign to most people.

CONWAY: Yes. Correct. Well, and I'm not suggesting that.

KELLY: Do you believe they are politicizing this?

CONWAY: No. I think people who wants this to be the permanent campaign, who are the election deniers, frankly and there's a whole group of them.  It is not just team Hillary, but it's a whole group of people who never even conceived the possibility that Donald Trump would be their president and he has been for 35 days now, they are politicizing it. I believe as President-elect has said which is more important than my opinion, he has great faith in the Intelligence Community. He said that as recently as this weekend.

But in this particular instance, if you read some of these news accounts in mainstream papers where people are reading something saying it must be true, I just read five paragraphs strong where there is an intimation, or an outright assertion that Russian interference changed the election result, that is just not proven --

KELLY: Uh-hm.

CONWAY: That is just false and it's dangerous to our democracy. You know, I went back and I looked at what Hillary Clinton said on live television at the last debate in Las Vegas on October 19th. And when Donald Trump said, I will keep you in suspense whether I will accept the election results, she shot back saying this is really scary.

KELLY: Uh-hm. She said it was horrifying.

CONWAY: She said it was horrifying. Which she said, I'll accept the election results because she thought she'd win. And now that she hasn't, I think she would be the strongest voice to come out at this moment, Megyn, maybe she will come and sit here tomorrow night and tell you.

KELLY: Not bloody likely.

CONWAY: That she went to call off the dogs. She wants everybody to stop suggesting this without any proof --

KELLY: Also not likely. Let me ask you about these meetings today. And by the way, is it true that he didn't have twitter there because I know they say they weren't big enough. But the rumor is, the report is that there was just dispute about whether there could be an Emoji, you know the little characters, showing crooked Hillary during the campaign and Twitter refused and that Trump was ticked off.

CONWAY: I never heard discussion of that at all. That would be too unserious given what the stakes are here and how these forums are put together.

KELLY: He is not always serious. Sometimes he is --

CONWAY: He is very focused.

KELLY: Sometimes he is lighthearted. Sometimes he is --

CONWAY: He is very lighthearted. He is humorous but he is very serious.  He is really -- he really has the gravity and the responsibility and I think frankly the humility that comes with being the President-elect. He's been in there every day working very hard. I thought today's meeting was fantastic. Not just because they were just quote, "political opponent."  That doesn't matter in this regard. It matters that you are talking to people along with the President and the Vice President of the United States, Megyn, who actually can make a difference and increase vocational educational opportunities. Really get serious about cyber security.

KELLY: Well, at least he is hearing them. At least he is hearing them.  There could be no criticism of him for hearing --

CONWAY: In fact his final comment was, he would like to do that more often, perhaps even have a quarterly tech meeting.

KELLY: Now the question will be, once they don't do what he likes, what does he do to them and does the relationship continue? Okay. Let me ask you this, he is taking some heat and so are the Trump sons for attending that meeting, Donald Trump, Jr. and Eric Trump because they are the ones who are supposed to take over the Trump organization. And Donald Trump is under fire for not fully divesting himself from this corporation yet, he says the boys are going to run it. But if they are going to run it, what were they doing in that meeting and shouldn't he more clearly be drawing the lines between the political side of the Trump organization and the business side?

CONWAY: I think that's an unfair accusation against the Trump adult kids from people who again are just not happy with the election result. And here is why he say that, they can sit in a meeting where their father is convening with the nation's largest tech titans who also have a responsibility I think to the public good to make sure that we have educational vocation opportunities and --

KELLY: No. But the next time Facebook or Google deals with Eric or Donald Trump, Jr. on a matter relating to the Trump organization if they ever do, then they understand these are both businessmen and connected and spokes people to the President of the United States.

CONWAY: I think that's really unfair to them. Because they are not spokes people, they are sons.

(CROSSTALK)

CONWAY: I know that. You know, I know that. I'm hearing back at those who are suggesting, I've read the same reports and the same Twitter feeds, Megyn. And I think it's incredibly irresponsible to say that, that Don Jr. and Eric and Ivanka and Jared can't be at a meeting with tech giant --

KELLY: Well, Ivanka and Jared are different because they're supposedly are not going to be running the Trump organization --

CONWAY: But these are his sons. These are his sons --

KELLY: I know. But he's got to choose, does he not? I mean, are we going to continue to see them in government-related meetings while they're running the Trump organization?

CONWAY: Here is what I do now.

KELLY: Are we?

CONWAY: That there is a lot of activity on the 25th and 26 for the Trump Tower right now with lawyers and protocol officers at great expense to the Trump family frankly trying to figure out how best to structure and how best to comply with protocols so that this very unusual situation where you don't have a typical politician who just moves his or her government pension to the next government job but somebody who is incredibly brilliant and successful businessman who has assets on many different continent --

KELLY: Understood. Understood.

CONWAY: -- trying to --

KELLY: But the country has a right to believe in its leaders and to understand there are clear lines that have been drawn --

CONWAY: Yes, of course. And they are going to announce that. But aren't we happy that you have the transparency and the openness of seeing them in the meeting?

KELLY: Well, if it is inappropriate, the transparency is like, oh great, we would have found out, it's nothing like, there are a lot of people there.

CONWAY: It is not inappropriate.

KELLY: But the question is, whether it is clear that, you know, this line has been drawn between the two sides.

CONWAY: It is an incredibly executives in the Trump corporation who will - -  

KELLY: No question.

CONWAY: -- continue to --

KELLY: No question. No question. But they're going to have to choose which horse they're on. Great to see you, Kellyanne.

CONWAY: Thank you.

KELLY: All the best.

CONWAY: Thank you.

KELLY: So, major players in the incoming Trump administration raising new questions over how a Trump White House will deal with the media. The press.

Former Trump campaign spokesperson Katrina Pierson is here along with the former White House Press Secretary Dana Perino. They are both going to tell us what this means for America and we will ask Katrina whether she is getting the job of White House press secretary.  

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

TRUMP: For the last month I decided not to do interviews, because they give interviews and chop up your sentences and cut them short. You will have this beautiful flowing sentence where the back of the sentence reverts to the front and they cut the back of the sentence off, and I say I never said that. So I said, you know what, I'm not going to deal with the very dishonest people. I said I'm not going to deal with them.

AUDIENCE: Boo.

(END VIDEO CLIP)

KELLY: His beautiful flowing sentence, the beautiful flowing sentences that got cut off and that is why, he doesn't talk to the media. That was President-elect Donald Trump last night taking news shots at the media during his thank you speech in Wisconsin. Then earlier today Mr. Trump future White House Chief of Staff Reince Priebus making it clear that the incoming administration is going to shake things up, when it come to their relationship with the press.

(BEGIN VIDEO CLIP)

REINCE PRIEBUS, CHIEF OF STAFF: I think that many things have to change.  You know even looking at things like the daily, you know, the daily White House briefings from the press secretary. I mean, there's a lot of different ways that things can be done. The point of all of this conversation is that the traditions while some of them are great, I think it's time to revisit a lot of these things that have been done in the White House and I can assure you that change is going to happen.

(END VIDEO CLIP)

KELLY: Katrina Pierson is former national spokesperson for the Trump campaign. She is with us now. Dana Perino is up in a minute, Katrina, great to see you.

KATRINA PIERSON, FORMER NATIONAL SPOKESPERSON FOR THE TRUMP CAMPAIGN:  Good to see you, Megyn.

KELLY: So I love that, the beautiful flowing sentences. It is like Trump's -- his words are the brek shampoo commercial of 2016. It is just gorgeous, it is flowing, if only they wouldn't cut it off, you would appreciate how beautiful it was. Let me ask you what they mean when they say some changes are coming.

PIERSON: Well, look, Megyn, Donald Trump was not your traditional candidate. He has made several promises throughout this entire cycle of making changes. The President-Elect is a very efficient man. He wants things done very effectively. All that means they will likely be changes in all aspects of government.

KELLY: Like what? Come on, give us, lock us down on possibilities, like, one of the things that left people shocked today that perhaps the White House press corps would not be seated according to rank or news organization and they might mix things up. Are they considering that at Trump level?

PIERSON: Well, I will echo the incoming Chief of Staff, and just say, everything is being looked at. There are things that they feel that could be done differently to be more effective. And if that is one of the things they will decide, they will definitely hear about it. Nothing has been decided yet. This is just something that is under discussion, because there are things that need to be changed throughout the entire government not just at -- with the Press Secretary and the White House.

KELLY: What about you? You are rumored to be on the short list, the reports are that Sean Spicer, who is Reince Priebus' deputy in RNC is the favorite, if you will. But you're on the list. And then today there is a report that our own Kimberly Guilfoyle might be on the list as well. So you will have some stiff competition, but is it a position that you would like?

PIERSON: There are a lot of rumors. You know I can't discuss who is being discussed for what position. You know, but I will tell you, Megyn, if I have been coming to Trump Tower for over year and a half now. And all of a sudden this week it became a headline. So there is really nothing there.  I work there. I'm a senior adviser to the Trump transition team. That is really all this is.

KELLY: Tell us this, on January 21st after he is been sworn in and there's no more transition team, do you foresee a career in government service?

PIERSON: Well none of those decisions have been made yet. But I will happily make myself available if the President-Elect wants my help, 100 percent. I fully support Donald Trump. I've told him that from the beginning. I've been on this show a number of times to help him be successful and I will continue to do so, if he wants to.

KELLY: You've always been a lovely guest and treated everyone here beautifully and been a loyal defender of his as well, great to see you Kat.

PIERSON: Thanks, Megyn.

KELLY: Joining us for more, former White House Press Secretary during the George W. Bush administration and author of the new book "Let me tell you about Jasper."

DANA PERINO, FORMER WHITE HOUSE PRESS SECRETARY: Boy I have come a long way.

KELLY: Dana Perino, host of The Five which is also big and congrats on the success of the book.

PERINO: Thanks and to you. Good to see you again.

KELLY: I know we were both been on these book tours. And now back on the business. The beautiful flowing sentences were being chopped up. And you tell me whether it would be a big deal for Trump to, a, mess up the seating chart at the White House press corps, or b, go beyond that when it comes to access they have to him.

PERINO: Well it is a big deal for the press corps. You've heard the saying nobody likes change except for a baby. The press really doesn't like change. And if you look at the business models over the past 15 years that is been very clear. But they are playing catch up and people adjust.  When it comes to seating chart I know that Ari Fleischer did it differently. I think, I don't know exactly how it happen when I inherited the Press Secretary job we turned that back over to the White House press corps to decide who sat where. Because what did I care? Once the briefing started I could call on whoever I wanted to.

KELLY: Reince Priebus said look this arranged seating thing that was a Barack Obama deal, George W. Bush.

PERINO: It wasn't, it was a Ronald Reagan deal.

KELLY: Ok. Because the Barack Obama White House came out today and said, you better check your history Mr. Priebus, because it wasn't us.

PERINO: Yes.

KELLY: So, it is the White House Press corp. The peaking order and if you don't get on the bended knee and kiss the ring and that would be the head of the press corps, not the president, you won't get in the front row.  There is definite going to be a change in the way that Trump deals with the media.

PERINO: Already has.

KELLY: Right, I mean that thing about not giving interview that is potentially problematic although since he was elected, he has given interviews.

PERINO: Yes. Especially like for example, when he sat down for 60 minutes, he did the Chris Wallace interview, he has done that. He hasn't done some press conferences that it is only 35 days. When they get started and they get into the grind of governing, I think they will find actually a daily press briefing is actually very useful both to the White House and to the press that is charged with covering them.

KELLY: But Donald Trump loves to be on camera and he is electric in front of it. He does have this, they say, they call -- it is true, he is. And he seems to get a Jones off of that. The idea of him not dealing with the press seems hard to imagine.

PETRAEUS: Well, think about it. Barack Obama does the same thing. One of the things he did when he first came in was he stopped having the photo -- they call them photo dogs, come in for this general pictures. I thought why would you do that, because he never takes a bad picture? And it is access for the press and it is like, it is easy to do and for a press secretary, it is one of those things like, can the Press come in and takes a picture?

Yes, fine, cross that off your list. But when President Obama started White House TV and just talking directly to the people then the press corps was like oh, my gosh, how does that going to work? They adjust and it works itself out. I have no doubt Donald Trump's team will do some things differently, but I think they will also find there are some basic rules of the road that are beneficial to them. And they can't expect that the White House press corps is going to come in and write glowing stories about their boss. I don't think they expect that.

KELLY: I don't if you are right about that. Remember Trump told the "New York Times" you are going to be very happy. And I've been saying, they are not going to be very happy and he is not happy.

PERINO: But are they tired of winning? I don't know.

KELLY: Dana Perino, tell me more about Jasper. One final thing, give me a thought to think about.

PERINO: He is in South Carolina this week, for the holidays.

KELLY: Nice. Enjoying the fresh air?

PERINO: I miss him.

KELLY: Which we don't have in New York City, great to see you.

PERINO: Can wear a sock monkey coat for Christmas.

KELLY: All right, let me just, let that marinate on myself.

PERINO: Someone gave it to me during the book tour.

KELLY: Great to see you.

PERINO: Thanks.

KELLY: Breaking tonight. A new cease-fire is supposed to be taking effect in the Syrian town in Aleppo tonight. But not before we spent the last 24 hours hearing some of the most horrific stories to come from any battlefield in recent memory. This is about to become Donald Trump's headache, but the question with before we get there is what is President Obama's responsibility and legacy here? Marc Thiessen and Mo Elleithee are here on that next.

Plus a Muslim teen told a story of being attacked on a New York City subway by three male Trump supporters. Now she has been arrested for filing a false report. This got a lot of coverage in the media, will the latest development? Our investigation is just ahead.

(COMMERCIAL BREAK)

KELLY: Breaking tonight, we are monitoring the situation in Aleppo, Syria tonight where they are trying to secure a cease-fire so they can evacuate some of the civilians. This comes after horrifying stories of unarmed residents being executed in the street just the latest atrocity out of there. Conor Powell is covering the breaking news from the Middle East bureau tonight, Conor?

CONOR POWELL, FOX NEWS: Megyn for most of the last five years, Aleppo has been controlled by Syria's opposition. The Assad regime back by Russia, launch a brutal campaign to retake Aleppo. And now really only about a square mile or so is under control by the opposition forces that has been a brutal bloody campaign to retake that, the U.N. describing the situation there as dire. There are reports that the Assad regime is executing the people in the streets. Many activists are actually taking to social media to post their farewells. Have a listen.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We want to defeat them. We didn't want anything else but freedom. You know, this world doesn't like freedom, it seems.

(END VIDEO CLIP)

POWELL: Now the cease-fire is in place to allow both civilians to leave the main areas where there are still some pockets of resistance and to allow opposition fighters to plead the city essentially to surrender without being killed. Cease-fire is supposed to go into effect last night, Megyn. That cease-fire however never took hold. It appears right now there is a brief moment of calm. Evacuations are meant to begin here in the next hour as the sun is due to rise in Aleppo and we will see if that actually happens. The history of cease-fires in Syria, Megyn as you well know, has been very, very difficult to get them to actually take hold to allow this fighting to stop.

KELLY: Absolutely. Conor Powell, thank you.

Joining us now, Mark Thiessen, a fellow at the American Enterprise Institute and Fox News contributor and Mo Elleithee, founding director of Georgetown University of Institute of Politics and Public Service, its dark and you know, the question Mark is somebody who worked in the Bush administration, among your other credential, you were chief speechwriter for George W. Bush, you know, obviously he made decisions when it came to Iraq that the country lives with to this day. The Iraqis do as well and George W. Bus does. The question is whether Syria is going to be Barack Obama's Iraq.

MARC THIESSEN, AMERICAN ENTERPRISING SCHOLAR AND FOX NEWS CONTRIBUTOR:  Well it certainly is his responsibility, because he is the one who did nothing to stop the situation. Josh Earnest was at the podium today and he said, this is a quote, even our harshest critics cannot articulate some sort of alternative and if they had the commander in chief would have hesitated to implement.

Well you know his critics did offer him an alternative, his own National Security Team, offered him an alternative. The alternative was very clear.  Step one. Don't withdraw all U.S. troops out of Iraq and lift your boot off of the terrorist necks. All of his military advisors, his Secretary of Defense, all told him don't do that. We need troops to stay in the country. Step two, do something to support the pro-western secular moderate opposition in Syria. Hillary Clinton, General Petraeus, Secretary of Defense Panetta, all came into Obama's office and said if you do not support the opposition it is going to create a vacuum that ISIS is going to come in to fill.

General Flynn, who is the head of the DIA, warned him. Gave him a memo that said, this is a quote from 2012, the deterioration of the situation in Syria has dire consequences and create the ideal atmosphere for ISIS to return to its old pockets and declare an Islamic state and renew facilitation terrorist elements from all over the Arab world. That happened. He was warned in 2012.

KELLY: Mo, why isn't this on Barack Obama? It is not like Iraq and that we didn't go over there and start a war with Syria. But they crossed a red line Barack Obama said they could not cross and we did nothing.

MO ELLEITHEE, EXECUTIVE DIRECTOR OF GEORGETOWN UNIVERSITY INSTITUTE OF POLITICS: Yeah and I think it is important to look back at that moment in time. I think, you know, to the greatest question as to what this is going to mean for his legacy, I think this is going to be one of those areas that history is going to forever debate as maybe with the darkest moment in his foreign policy.

KELLY: It's genocide. We are allowing it to happen.

ELLEITHEE: And you know the question then is could it have been prevented without putting significant military presence on the ground. And if you think back to what this president ran on, in 2008 and what the mood of the country was during that period in time.

KELLY: No one made him set that red line. No one made him do that with chemical weapons. Saying if you used those, we are coming in and they did, and he did nothing and then they were involved in Marc Thiessen.

THIESSEN: Well absolutely, what happen was, his advisors again told him, when he sat his -- they leaked it all to the Wall Street Journal. When he said we are not going to enforce the red line, they all went to the Wall Street Journal and we told them you have to enforce the red line, because what is it involves the Assad regime and they have continued. They are using chemical weapons. They are using chlorine gas in Aleppo today. And then you have the refuge crisis.

KELLY: Nothing changes. Notwithstanding the videos we see of the children begging for help, Mo. I'll give you the last word.

ELLEITHEE: Yeah, look, we had Susan Rice over at Georgetown a couple of months ago to talk about the Obama legacy and she laid out Syria as the biggest frustration, the biggest challenge that this administration wishes it could have figured out a different way to do. I don't know that there is an easy answer to this especially with Russia's involvement in recent months. This is now a global conflict and the next president who has said he wants to work with Assad, you know, I worry that it's about to get worse before it gets better.

KELLY: It was never easy and it is getting harder by the moment. Good to see you both, guys.

ELLEITHEE: That is right, half a million dead.

KELLY: Half a million, just ahead, the Muslim teen that accused men of attacking her on the subway for her faith is now facing criminal charges.

(COMMERCIAL BREAK)

KELLY: Four years ago today we lost 20 children and 6 educators to an act of barbarism. On December 14, 2012 terror was unleashed in a first grade classroom as more than two dozens of innocent were murdered by a gunman in Sandy Hook Elementary School, Newtown, Connecticut. Earlier today a moment of silence and flags were lowered to half-staff to honor the fallen.  President Obama remark today the children who live thru the tragedy, saying we remember the children who held each other in the face of evil. Who even as they have grown up in the shadow of this tragedy, will grow up loved and cared for more fiercely than ever. Our thoughts here and our prayers are with all of the Newtown families, many of whom we've gotten to know over the years tonight.

Meantime, there is new reaction tonight to a story that looked very disturbing at first glance, but turned out to be a sham. This teenage woman said she was attacked for her faith. It turns out it didn't quite go down that way. Trace Gallagher has the details from L.A. Trace?

GALLAGHER: Megyn at the time the 18-year-old claimed three drunken young white men taunted her, assaulted her and hurled a barrage of anti-Islam slurs. She told police the man kept screaming Donald Trump name saying oh, look a blanking terrorist. Get the hell out of the country you don't belong here. She went on to allege the man tried to pull off her hijab saying that, take that thing off.

The student got away and got off at the subway at Grand Central reported to police, even sat with police officers for hours trying to id the men on surveillance video. Later blame the attack on Donald Trump saying, the President-Elect just promotes this stuff and is very anti-Muslim, very Islamophobic and he is just condoning it. The New York daily news called the suspect the brutal bigots and the hate-spewing trio.

The L.A. Times wrote, Muslim women, plural targeted in New York and now we know it, it never happened. The 18-year old saying she misguiding made up the tale to get attention, because she was having issues with her family.  She has been charged, Megyn?

KELLY: Trace, thanks. We'll be right back.

(COMMERCIAL BREAK)

KELLY: Well just in time for Christmas, my book "Settle for More" is going on sale for one day only on Amazon tomorrow. Forbes Stephanie Demming just reviewed the book, writing quote, "I confess, I picked up Megyn Kelly's book, Settle for More, curious about the peculiar Donald Trump and aisles episode that lit up the news. When I put the book down, I walk away thinking she was far more interesting character than either of those stories credited her to be." It will make a great Christmas gift. Amazon tomorrow, "Settle for More".

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