President Trump turns up the heat on North Korea

This is a rush transcript from "Special Report with Bret Baier," September 21, 2017. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIPS)

PRESIDENT DONALD TRUMP: Today I am announcing a new executive order that significantly expands our authorities to target individuals, companies, financial institutions that finance and facilitate trade with North Korea.

TREASURY SECRETARY STEVE MNUCHIN: Foreign financial institutions are now on notice that going forward they can choose to do business with the United States or with North Korea, but not both.

This action is directed at everyone. It is in no way specifically directed at China. And we look forward to working very closely with them.

(END VIDEO CLIPS)

BRET BAIER, ANCHOR: Right, but China is getting the message, and the Chinese central bank is the one that's doing the most business with North Korea and now says it won't. This as just moments ago we have our first reaction from the North Korean leader, Kim Jong-un, who says in a long, rambling statement "I am now thinking hard about what response he," President Trump, "could have expected when he allowed such eccentric words to trip off his tongue," talking about Trump's speech to the U.N. "Whatever Trump might have expected, he will face results beyond his expectation. I will surely and definitely tame them mentally deranged U.S. dotard with fire" says Kim Jong-un in the latest statement, among other things.

With that, let's bring in our panel: Steve Hayes, editor in chief of The Weekly Standard; A.B. Stoddard, associate editor at Real Clear Politics and host at No Labels Radio on Sirius XM, and Charles Hurt, opinion editor for The Washington Times. Steve?

STEVE HAYES, THE WEEKLY STANDARD: I think it's a potentially big moment. We have to wait and see the details, we have to see where this goes, but it's no small thing that Donald Trump's pressure on China has resulted in China at least going through the motions of saying that they don't want to do business, finance business with the North Koreans.

And it wasn't just that the central bank said that it wouldn't do business with the North Koreans. It suggested to other Chinese banks that they also not do business with the North Koreans. That's a potentially big step if they follow through. The problem is it's a huge lack of transparency. We are not going to necessarily know this.

BAIER: I asked Gordon Chang about that, and he said that all the dollars go through New York and that we would with a lot more scrutiny be able to see whether it has stopped or not.

HAYES: I think we can take steps to see more. I don't think we'll have a complete picture, but I defer to Gordon Chang. Gordon Chang knows a lot more about this than I do.

But this is a result of Donald Trump's consistent pressure on the Chinese, not just asking the Chinese to do our bidding with the North Koreans but telling them there are going to be prices to pay if you don't work with us.

BAIER: Do you think the speech had anything to do with it?

HAYES: I think the speech may have helped, but I think it has much more to do with a consistent argument that Trump has been making both in public and in private with the Chinese.

BAIER: Just to go back to last week where we have the treasury secretary on and he foreshadowed this movement in an interview.

(BEGIN VIDEO CLIP)

MNUCHIN: I worked on an executive order that's ready if the president wants to use it. We can stop trade with any country that does business with North Korea. We are going to be careful using these tools, but the president is committed. We will use economic sanctions to bring North Korea to the table.

BAIER: You are saying stopping trade with China?

MNUCHIN: Stopping trade with anybody. Nobody would be off the table.

(END VIDEO CLIP)

BAIER: That's a big moment.

A.B. STODDARD, REAL CLEAR POLITICS: Right. I think that Steve is right. It is a very significant concession by the Chinese that the central bank would halt any activity with the North Koreans. It is the question, hopefully it is that transparent and everything can be monitored, but it's a question of how enforceable it is and whether or not they are doing some rogue, secretive, supportive measures for the North Koreans, which they have done all along. So far the Chinese have never halted the North Koreans. This has to be sort of this final test, right.

They are undeterred, the North Koreans are undeterred, Kim is by President Trump. He just is. It's really on the Chinese. And I think that President Trump, whatever he's done, I agree, behind-the-scenes and publicly, seems to have brought us to this moment with China, and it is absolutely the best hope and it's the only hope. And it needs to be sustainable pressure.

BAIER: For years, every official has been saying the Chinese need to step up. We need to pressure the Chinese. Whatever has happened has obviously pressured the Chinese.

CHARLES HURT, THE WASHINGTON TIMES: Yes. And I don't think you can overstate how much credit Donald Trump deserves for this. From the beginning obviously President Trump is an incredibly disruptive figure. He's not exactly a diplomatic -- he doesn't have a whole lot of regard for the diplomatic norms that we see at the U.N. He's been a shock to the system.

But I thought that his speech that he gave this week was, it sort of laid out the Trump doctrine. He started with hard power, he started the speech by saying, look, we are investing, we have the greatest military unearth and it's about to be even stronger. We're going to invest more money. And then he goes on to sort of call out people. And I do think that that kind of blunt talk that makes a lot of people around here very uncomfortable has gone a long way towards making it very clear.

And another thing that I think is important is people talk about how transactional he is. He's a businessman. Yes, I think that's probably a healthy thing here. This America first thing is a very healthy thing where everybody knows where he stands, where America stands. And I think particularly in places like China his experience and reputation as a businessman is very, very respected, far more than I think accomplishments in the political realm, for example.

BAIER: Kim Jong-un and also the statement "A frightened dog barks louder. The mentally deranged behavior of the U.S. president openly expressing on the U.N. arena the unethical will to totally destroy a sovereign state." He goes on, "makes even those with the normal thinking faculty think about discretion and composure." This is a statement from Kim Jong-un who killed his own family member with an antiaircraft gun in front of others. So discretion and composure.

HURT: Are you sure that's not a Nancy Pelosi tweet?

BAIER: Steve?

HAYES: A reasonable amount of projection I think in that statement from Kim Jong-un. The main difference in the diplomacy for the past 25 years and what we've seen over the first nine months is the dispensing with the idea that China and the United States share exactly the same interests in the Korean peninsula. We don't. We never have. And it was true of the Clinton administration, the Bush administration, the Obama administration simply outsourced our diplomacy to China. It was never the case that China was going to do our bidding. We had to actually put some pressure on them.

Charlie is right. Donald Trump is a very blunt. What Secretary Mnuchin said to you made me nervous. I don't like the idea of threatening to cut off trade with China. That's a pretty big card to lay on the table. But at least so far as we're seeing in this particular instance it seems to be working.

BAIER: And I guess the question is what the responses to this statement, what tweet may be coming.

STODDARD: That's why I talked, Bret, about what is sustainable. So the smashing of diplomatic norms and everything does come into play here. The Chinese really preserve saving face as a priority. And what has to happen here, Kim is undeterred by Trump. He is scared of the Chinese. They have to act.

Whatever Trump says on stage at the U.N. doesn't matter to Kim Jong-un. His focus is on the Chinese government and the help he needs from them. And so if these sanctions are enforced, if all the banking and all the activity, the economic help that goes, the trade is down 90 percent, the oil imports down 30 percent, this really starts to squeeze them. That might make him calm down. But more provocative tweets from Donald Trump is not going to help.

BAIER: Do you think General Kelly is saying --

HURT: Saying hide the BlackBerry.

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