Trump seeks a new strategy for dealing with Iran

This is a rush transcript from "Journal Editorial Report," October 14, 2017. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

PRESIDENT DONALD TRUMP: Based on the factual record I have put forward, I am announcing today that we cannot and will not make this certification. We will not continue down a path whose predictable conclusion is more violence, more terror, and the very real threat of a Iran's nuclear breakout.

(END VIDEO CLIP)

PAUL GIGOT, HOST: Welcome to the "Journal Editorial Report." I'm Paul Gigot.

President Trump Friday struck a blow to the 2015 Iran nuclear agreement, choosing not to certify that Tehran is complying with the deal. The president, who called for a new strategy for dealing with the rogue regime, vowed to work with Congress and our allies to address the deal's flaws and announced new sanctions on Iran's Revolutionary Guard for their financing of terror groups.

Mark Dubowitz is the CEO of the Foundation for Defense of Democracies.

Welcome back. Good to have you here.

Thanks, Paul.

GIGOT: So the president was very critical of Iran and the nuclear deal. Yet, he didn't pull out. Why not just pull out?

DUBOWITZ: I think the president really announced a comprehensive strategy, and I think the nuclear deal is only part of that strategy. What he really emphasized is of the United States is now willing to use all instruments of national power to neutralize and to roll back Iranian aggression. And that the deal itself is a deeply flawed deal, but a deal that he is willing to give at least some time and space to his diplomats and the U.S. Congress to try to work and fix.

GIGOT: What is the advantage of just not certifying, which is, by the way, not pulling out, because that's the certification just revolves on American law that requires him to make that decision every 90 days. What's the advantage of that over withdrawal?

DUBOWITZ: Well, I think the president is doing with decertification is he's saying I'm actually prepared to withdraw. And the certification actually strengthens the credibility of Donald Trump's walk-away threat. The certification, a recertification of the deal would have severely degraded that credibility of walking away. The president is not saying, look, I think this deal is not in the vital national interests of the United States as it is presently negotiated and constructed. I am prepared to actually give time and space to fix that deal. But I will walk away from this deal in the deal is not fixed, if our allies don't come on board, if Democrats don't join Republicans in locking in tough conditions into U.S. law. And I'm willing to give that time and space as well because I want to roll out a comprehensive strategy using all of these instruments of national power to really target Iran's destructive behavior, regionally and globally.

GIGOT: OK, now I saw a statement from the Europeans, a joint statement from the Germans, the French and the British, I think, saying that they stand by the nuclear deal. They don't want it to go away. They think it's - Iran is actually honoring the terms of that agreement. But they did give a little wiggle room at the end of that statement to say, we are happy to talk about, look into maybe strengthening some of the terms. How do you read their reaction?

DUBOWITZ: Right. I think you're right to focus on the wiggle room. That, over the past few months, Paul it's been really interesting. I think Europeans have really gotten from a posture of "keep it" to a posture of "fix it" in order to prevent Donald Trump from taking the posture of "nix it." I think that has been an interesting movement in the debate. Right? The Europeans, President Macron, of France, has actually said on three occasions, I'm willing to look at strengthening the deal, complementing it, supplementing it, I'm willing to look at sunset provisions and missiles and, obviously, Iran's regional behavior outside the deal. That is a significant shift in the European position. And I think they are shifty, Paul, because they are terrified that Donald Trump could walk away from this deal. It's giving him a lot more negotiating leverage.

GIGOT: Now, the president said he is going to go to Congress to try to get Congress to write new legislation that would have so-called redlines, that if Iran walked over those redlines, then the U.S. would automatically make the deal null and void. And I've talked to some Senators who have been working on this, and what they are saying are things like intercontinental ballistic missile development, how many centrifuges they can have, try to get rid of the sunset provision that begins as early as eight years from now. What odds do you think exists for that getting 60 votes in the Senate and passing?

DUBOWITZ: Well, Paul, it has not been a successful legislative session, so I think -- I wouldn't be betting my strategy on getting 52 Republicans and eight Democrats to come on board these days, except maybe renaming the cafeteria in the Senate. But I would say is this, is that the president is giving them an opportunity to come on board, show bipartisan support, lockdown these conditions, which he has said the United States will not accept, establish a framework where sanctions would not be snapped back immediately, with the only snap back in six or eight or 10 years if Iran violates that conditions. But of course, the president retains executive authority, so if Congress does not do this, I imagine he has a backup plan where he could do this on his own using executive authority and moving forward with the Europeans on the diplomatic track. GIGOT: How do you think Iran is going to respond to this because, obviously, their initial response is going to be this violates the terms of the deal, we are not violating the deal and we won't change it. Do you think they will eventually -- I mean, could they make a decision to say that this nixes the deal, we're going to sprint to a nuclear weapon?

DUBOWITZ: Everything is possible. And one has to plan for all of these contingencies. And I hope the administration has a plan for all of these contingencies. My assessment is not. I think the Iranians - the smart play for the Iranians is not to get hysterical, is to say that they are going to keep the deal and try to divide that Europeans from the Americans, the West with the Chinese and Russians, and continue getting all of the benefits of the deal. The thing about this deal is this deal was never about Iranian compliance. This deal was about the delusion of the deal, because it provided patient pathways to nuclear weapons and ICBMs for the Iranians by complying.

GIGOT: Right.

DUBOWITZ: So it actually is a smart deal for the Iranians. And therefore, it's smart for them comply and it's smart for them to try to divide the trans-Atlantic alliance. It's a risk for this administration.

GIGOT: For the Trump administration, that's a risk, yes.

DUBOWITZ: Correct.

GIGOT: OK. All right. Thank you, Mark Dubowitz. Really appreciate you being here.

DUBOWITZ: Thanks for having me, Paul.

GIGOT: When we come back, after Congress fails to repeal and replace ObamaCare, President Trump takes matters into his own hands, moving this week to unravel key parts of the law. So can he deliver on his promise to lower costs and increase choice in the insurance market?

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

TRUMP: With these actions, we are moving towards lower costs and more options in the health care market and taking crucial steps towards saving the American people from the nightmare of ObamaCare. Today is only the beginning. In the coming months, we plan to take new measures to provide our people with even more relief and more freedom.

(END VIDEO CLIP)

GIGOT: After repeated failures by Republicans in Congress to repeal and replace ObamaCare, President Trump this week took matters into his own hands, signing an executive order Thursday that directs cabinet agencies to develop rules that would expand access to less expensive and less comprehensive plans than those offered by the Affordable Care Act. The president later announced he would halt subsidy payments to insurers who sell coverage under ObamaCare, a move that could fundamentally reshape his predecessor's signature health care law.

Let's bring in Wall Street Journal columnist and deputy editor, Dan Henninger, assistant editorial page editor, James Freeman, and editorial page writer, Kate Bachelder Odell.

Kate, let's start with the subsidy payments first. Getting a lot of criticism. Why did he do this?

KATE BACHELDER ODELL, EDITORIAL PAGE WRITER: First, these are payments that go to insurers that defray the costs of health care expenses. These payments have been ruled illegal by a federal judge. And here is why. The original law basically enticed states to set up exchanges with the promise of these subsidies. Some states didn't. The question is whether they still get the subsidies. This has been hung up in the courts. And a federal judge has ruled that -

(CROSSTALK)

GIGOT: But there hasn't been a formal appropriation by Congress for the money.

ODELL: That's right --

(CROSSTALK)

GIGOT: That's why they've been declared illegal.

ODELL: Congress has declined to appropriate the money. The question now is, as it has been for months, whether the Trump administration should keep making these illegal payments. So Trump has now decided that they shouldn't. So the question is, what will happen next.

GIGOT: And the ball being tossed to Congress to be able to do this.

Now, the other issue is the larger reform of the insurance market through new association health plans health care plans that they are going to try to promote and the small plans, so-called small plans. What's that about?

ODELL: The White House executive order takes these modest steps to try to salvage an individual market. One of them is short-term health insurance that the Obama administration limited to 90 days because people were using it as a cheaper backdoor to avoid having to buy expensive plans on the exchanges. Traditionally, there hasn't been an incredibly high demand for this product, but it could change now that ObamaCare has wiped out the individual market.

The second question is on association health plans. Those would potentially allow small businesses, trade groups to band together to form really large pools so they can enjoy economies of scale and get better insurance.

GIGOT: And the idea here, Dan, is to provide more alternatives in the individual marketplace so that not everybody has to pay these really high prices with really comprehensive plans. You'd think it would make sense. If you are young, you need a plan, you're in between jobs, you need a plan for a year, why not?

DAN HENNINGER, COLUMNIST & DEPUTY EDITOR: That's exactly right, Paul. Look, ObamaCare, 2000 pages long, the Affordable Care Act was a flawed piece of legislation. In the year 2015, 6.7 million young individuals opted to take the penalty rather than join the plan, 6.7 million. What you had was the basic idea to make ObamaCare work was that all of the younger underinsured and no insured had to be forced into the exchanges to make the risk pool work. The population resisted that. And now somebody has to clean up the mess. And that is exactly what President Trump is doing by trying to create these alternatives with choices that would allow some of those six million people to say, I did not like ObamaCare, but I have a choice now, a plan that suits me.

GIGOT: But, Kate, these are called junk plans, some of these small plans. Is that fair?

ODELL: Look, that is a charge from the left, that basically decided what health insurance everyone must have and what it must cover. It's -- we hear a lot about these plans being less comprehensive, and how can you know that, not knowing an individual's needs and health status and what kind of insurance they are looking for.

GIGOT: OK, James?

JAMES FREEMAN, ASSISTANT EDITORIAL PAGE EDITOR: Well -

GIGOT: Sabotage, that's the other word the left is using. This is a deliberate attempt to sabotage the law.

FREEMAN: To sabotage what? They pretend that some of the market is being disturbed, but what ObamaCare did was it prevented a market. Half of the country, you have one insurer in the individual marketplace. No competition. Monopoly.

GIGOT: I think it's about a third now.

(LAUGHTER)

(CROSSTALK)

FREEMAN: I should say half of the counties in the country. And obviously, lots of other counties where you only have two competitors, a duopoly. So the customers, as we found, doesn't want the product. He's willing to pay a tax to avoid it. Even for those that go in, massive premium increases. I think -- President Obama said he wanted to rule by pen and phone. I think he's now seen the flip side of that, is that a lot of it can be undone administratively, and especially in cases where he did not have the authority to subsidize.

GIGOT: But that is exactly the point, Kate, pen and phone, regulation. This is not going to have the force of law in statutes. So Republicans -- aren't Republicans kind of doing the reverse of what Obama did?

ODELL: Right. This executive order will be much less durable because it directs agencies to develop rules that will inevitably be challenged in court. Also rules take time to develop. And insurers set premiums on a long time horizon.

GIGOT: James?

FREEMAN: Yes. If I could just add, this charge that junk plans are ones that don't fit the ObamaCare model, that includes the ones we're in. That includes the ones that over 100 million Americans are in. Employer- sponsored coverage that is exempt from much of ObamaCare. Junk plans actually means freedom, lower costs, more choices.

GIGOT: And the solution here, I think, is that, ultimately, if they want to get these payments back, Congress can appropriate it and the compromise is available. Democrats give Republicans more freedom that they want and fewer mandates, and then Republicans vote for --

(CROSSTALK)

HENNINGER: And President Trump has been saying one of the reasons we're doing this is to induce Congress to react and address the flaws in the law as law.

GIGOT: All right. Thank you.

When we come back, former Trump strategist, Steve Bannon, declares war on Senate Republicans, promising them primary challenges to all but one Republican incumbent. So will his strategy succeed in draining the swamp or put the Republican majority at risk?

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

STEVE BANNON, EDITOR, BRIETBART & FORMER TRUMP STRATEGIST: We are declaring war on the Republican establishment that does not back the agenda that Donald Trump ran on.

Just voting is not good enough. You have to have a sense of urgency. Nobody is safe. We are coming after all of them and we are going to win.

(END VIDEO CLIP)

GIGOT: Former White House chief of staff strategist, Steve Bannon, declared war on Senate Republicans this week, telling Fox's Sean Hannity that he's working to field primary challengers to all but one Republican incumbent running for re-election in 2018. Bannon said it's necessary to drain the D.C. swamp to get President Trump's stalled agenda moving on Capitol Hill. But does the strategy put the Republican majority at risk?

We're back with Dan Henninger, James Freeman, and columnist, Bill McGurn.

So, Dan, what does Steve Bannon want? He says it's Trump's agenda but is that really it?

HENNINGER: Well, that's a large question. But let's just deal with what he's told Sean Hannity. Very explicit. He said just voting for Trump's agenda is not enough. So if you're someone like Senator John Barrasso, who has virtually a 100 percent Trump voting record, that's not enough. You have to have a sense of urgency.

GIGOT: What does that mean?

HENNINGER: Well, what does that mean? You have to be going on television every other day and giving speeches.

(CROSSTALK)

GIGOT: Because we don't have enough politicians on television.

(CROSSTALK)

HENNINGER: You have to be like Steve Bannon. You have to be out there crusading and rabble rousing. Beyond that, it's not clear. And I think that's going to be a problem for him. Because, ultimately, you are talking about voters inside these states, not just debate, not just people who subscribe to "Breitbart," but the voters. And they have to decide for themselves is voting 100 percent for Trump not enough?

GIGOT: Bill, John Barrasso, pretty conservative.

BILL MCGURN, COLUMNIST: Right.

GIGOT: Dan Fisher, pretty conservative.

MCGURN: Right.

GIGOT: These are not liberal, west.

MCGURN: Right. Look, I look at it the other way, in this sense. What does Donald Trump need? He needs more Republicans in the Senate. We would've passed the ObamaCare repeal if we had it. The enemy is not other Republicans. And one of the things I think is a problem is I think Steve Bannon may be overreaching because -- if he doesn't do this. Anyone can go in, if you have some backing, and make it difficult with the primary candidate. But if your goal really is the Trump agenda, what we need is more Republicans in the Senate and fewer Democrats. I don't see how this helps.

(CROSSTALK)

MCGURN: -- the day after like, for example, it's all Mitch McConnell. Right? They're not even -- they're running not even for the Trump agenda but against Mitch McConnell.

GIGOT: That seems to be the one promise he is exacting from this.

MCGURN: Right.

GIGOT: And you must vote against him for leader.

MCGURN: Right. And McConnell is sort of unpopular now in some ways because of the failures. But who do they want to replace him? Who is likely to replace him?

I would say one last thing. For all of the talk about the Republican establishment, on ObamaCare, where there was a failure, it is, what, at most, seven Republicans. All the other Republicans voted for it.

GIGOT: Well, one of the people who was responsible for the failure, James, Rand Paul.

FREEMAN: Right.

GIGOT: Rand Paul is supposed to be the great outsider. He helped kill repeal. Then you have Susan Collins of Maine. You have John McCain, who is not even up this year. These are the people -- and Lisa Murkowski in Alaska. They are not up either. These are the people who helped kill repeal and replace.

FREEMAN: Well, I think it has to be annoying to the Republican voter watching that game where they had a whole bunch of varieties of repeal and they kind of took turns voting yes or no so they can claim in the future that they were on one side or the other. And the end result was it didn't get done. They never got to the 51 with Mike Pence that they needed. So I think it is very reasonable to expect that there is going to be a response, a revulsion among the Republican base, given all the promises. I think, though, maybe they are aiming at the wrong targets. You think, unfortunately, of a lot of the people who really created this problem are not up for re-election next year.

(CROSSTALK)

FREEMAN: You think of Rob Portman, who persuaded voters that he was for restraining the growth of government. John McCain who assured voters he was for getting rid of ObamaCare. Those are the targets in the future. Maybe there --

(CROSSSTALK)

GIGOT: There is also the question, Dan, of who they are going to run.

HENNINGER: Yes.

GIGOT: That Bannon is going to get behind. You've Danny Tarkanian in Nevada running against Dan Heller. He has lost a lot of races statewide. How strong a candidate -- how strong a field does he -- is he supporting it?

FREEMAN: Steve Bannon had said in interviews the candidate selection is going to be an issue for them. I think I would call it a challenge for them. Secondly, if you primary Republican candidates like this, then you end up pushing them into positions that may not play well in the general election. That's what happened to Luther Strange down there in Alabama. Secondly, there's a question of policy. What are they going to run on? Now this campaign is being funded by Bob Mercer and his daughter, Rebecca. It's possible they could create some policy shops to pull that into the game. And, finally, there is donor confusion. What about the other Republican donors out there who fund Republican candidates? What are they going to make of something like this? I don't think too many of them are going to get behind the Bannon crusade here. They have to decide whether they want to elect the people who are already in Congress who have been supporting Trump to this date.

MCGURN: Yes. I think the final test is, again, as I say, getting an agenda through. And anyone can ruin it for other people. Right? You can take down a few people. But the question is, can you put -- presumably, Bannon has an agenda or the president has an agenda. Can you put people in through -- in Congress that will get the agenda through?

GIGOT: We don't want political competition. Let's have it out. That's fine. But the question is, if these Bannon candidates win, can they win a general?

FREEMAN: I'm not sure. If Republicans fail on taxes now, after failing on ObamaCare, I'm not sure a lot of voters will see a huge downside. I think it is a test for Mitch McConnell. He's got to find a way, through persuasion, threats, whatever it takes, to get that done.

GIGOT: All right, still ahead, as President Trump takes his tax reform pitch on the road, Republicans in Congress race to deliver a bill before the end of the year. So just how close are they? We'll ask House Ways and Means Committee Chair Kevin Brady, next.

(BEGIN VIDEO CLIP)

REP. PAUL RYAN, R-WIS., SPEAKER OF THE HOUSE: Our point is, get it done this year. We want to wake up on New Year's Day with a new tax system.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

TRUMP: We're going to fight and we're going to get those Republicans, and maybe a few of those Democrats --

(CHEERING)

TRUMP: -- to raise their hand, and you are going to have so much money to spend in this wonderful country --

(CHEERING)

TRUMP: -- in this great economy. That is why we have proposed tax cuts that are pro-growth, pro-jobs, pro-worker, pro-family and pro-American.

(END VIDEO CLIP)

GIGOT: That was President Trump on Wednesday night taking his tax reform pitch to Harrisburg, Pennsylvania, and turning up the heat on members of Congress to get a bill on his desk before the end of the year.

Here with a look at what progress is being made on Capitol Hill, Congressman Kevin Brady, chairman of the tax-writing Ways and Means Committee.

Welcome, Mr. Chairman. Good to have you here.

So the president says 20 percent, that is as high as he's going to go on the corporate tax rate, no more. Are you firm with that, too?

REP. KEVIN BRADY, R-TEXAS, CHAIRMAN, HOUSE WAYS & MEANS COMMITTEE: I absolutely am. Look, that's what it takes for companies to be competitive, whether they are competitive on Main Street or competing around the world. We want them to win. We want them to bring the earnings back to be reinvested in America. If we do that right, which we will, paychecks will grow, jobs will grow, and a lot more opportunity will grow than what we have today.

GIGOT: OK. That means a 25 percent rate for the so-called pass-through rate that is small businesses, often. You're sticking to 25 on that, too?

BRADY: Absolutely. We're trying to drive that rate down for every business, an equal tax cuts, regardless of what size you are. If you are the mom-and-pop or that new young entrepreneur or you're the biggest company we have, we know what it takes to be competitive against China, Europe, on Main Street as well. We have to drive those rates now.

GIGOT: OK. Let's take some of the criticisms. I know you're hearing it behind the scenes, and in public, of some of the framework that you guys have offered. One of them concerns the state and local tax deduction, which is crucial to getting the money by eliminating that to finance the lower rates. But you are getting some criticism from Republicans and Democrats in high-tax states. Are you willing to compromise on total elimination?

BRADY: Here is where we are starting with. There is no criticism we need to lower the tax rates for everybody --

GIGOT: Right.

BRADY: -- so you can keep more of what you earn, including in high-tax states. Secondly, we know having a simpler code where we protect more of the first dollars families earn, including in high-tax states, there is consensus there. So what we are looking at are the incredibly high rates of taxes that taxpayers pay in some of these states. We want to lower those tax rates for everybody. And so we are listening, one, and making sure that we understand just how burdensome those taxes are. But, secondly, there is a reason we haven't set the rates or the brackets so that we can make sure we let people keep more of what they earn regardless of where they live.

GIGOT: Right. One of the things I am hearing is, particularly in New York and California, when you have a lot -- believe it not, you have a lot of Republican members, including enough that they could kill your reform if they wanted to, I'm hearing them say, in particular, you have to do something to ease that burden on some middle-class taxpayers. And I'm hearing that they are talking about some kind of property tax deduction for middle-class families, middle-class taxpayers in those states. Is that true?

BRADY: So we have had a number of ideas. One, where we set the rates and the bracket are incredibly important. How we address issues like child tax credits, incredibly important for middle class families. But also how we address those tough local issues, like property taxes, that aren't based on your ability to pay. They are just painful. They brought us ideas on how we can address issues like that. We are having the discussions. We had some at the end of the week, this week as well. We will continue to stay at the table with them. Because, again, Paul, at the end of the day, we want every American to keep more of what they earn regardless of where they live.

GIGOT: OK. Now what I hear you saying there, between the lines, is, yes, this is on the table. It's something that you're thinking about.

So let me --

BRADY: We are listening very carefully to their ideas. Look, I don't know how families in these high0tax states make it. The rates are just stunning. In some states, the government has a greater claim over your earnings than you do, which is, to me, it's hard to believe that happens.

GIGOT: Another criticism that I've heard, even from some conservatives, is that you are eliminating the personal exemption, but in return, you are doubling the standard deduction to $24,000 for a family. What happens is some people say, you know, because you're getting rid of the personal deduction, you are still going to end up raising taxes on some middle-class taxpayers. What is your response to that?

BRADY: Yes, that's absolutely not true. Because while we double the standard deduction, it really helps with simplification and eliminates the personal exemption. There is a reason why the child tax credit plays such an incredibly important role in this. Plus, we are lowering those rates at every level. So regardless of where you're at, taking the 10 percent bracket to zero --

GIGOT: Right.

BRADY: -- from 15 down to 12, in all that, we provide tax relief all the way up the chain, for modest-income families, for middle-income families, above. So those claims, frankly, they don't have the information.

GIGOT: OK. The other criticism you get a lot, and this is from the Democrats, in particular, is you are going to blow a hole in the deficit. The Senate, as you know, has in its budget resolution about a trillion and a half dollars of net tax cuts available to them over 10 years. How are you going to fill that trillion and a half pull?

BRADY: There is no question tax reform, done right, will grow the economy. We've seen this in the Kennedy years. We saw this with the Reagan tax cuts. So we know the current tax code holds us back. So growth is going to help us bounce back over time. But that, alone, won't do it. You have to eliminate the special-interest deductions and exclusions and lobbyist loopholes in order to do that. That is why we are working so hard on simplifying the code, both on the business and the family side, so we can lower the rates for everybody. You've got to do both, growth and knock that underbrush of just special-interest provisions out of there.

GIGOT: All right. Quickly, Mr. Chairman, when are we going to see your mark in the Ways and Means Committee so we can see all of those details?

BRADY: Yes, it is all accelerating. It all pivots off the budget. When the House and Senate, together, vote, sign, seal and deliver the budget, we will immediately move to committee action. I will lay out what is called the chairman's mark, which is the Ways and Means Committee comprehensive tax reform plan. We will do it immediately, listen, and begin committee action. So this whole process is accelerating and it all pivots off the Senate passing the budget next week and reaching an agreement.

GIGOT: OK. Thank you, Mr. Chairman. Appreciate your being here.

BRADY: Thank you, Paul.

GIGOT: Still ahead, all eyes on Virginia where the race for governor is heating up. So is that swing state showdown a referendum on President Trump's first year in office?

(COMMERCIAL BREAK)

GIGOT: A showdown in the swing state of Virginia is taking on national prominence as former Republican National Committee chair, Ed Gillespie, and Democratic Lieutenant Governor Ralph Northam enter the final stretch of the hotly contested governor's race there. The candidates bringing in the heavy hitters this weekend with Vice President Mike Pence and former Vice President Joe Biden both stumping in the state. The contest, one of just two governor races this year, is seen by some as an early referendum on President Trump's first year in office, and a possible bellwether for the 2018 midterm elections.

We are back with Dan Henninger, James Freeman, and columnist, Bill McGurn.

So, James, this is the big test here in the post- Trump era. Ed Gillespie, I know him well. You guys know him well. He would seem to be a perfect candidate for Republicans in Virginia, but he is trailing.

JAMES FREEMAN, ASSISTANT EDITORIAL PAGE EDITOR: Yes, he is. The president is not popular in Virginia, like he's not all that popular in much of the country. Ed Gillespie, I think what he is shown, even though he is down in this race currently, we learned from the Senate race last time around, he is a very good closer. Didn't -- came up a little short at the end. But a very good campaigner, very savvy guy. I think for people who know him, what's exciting is the possibility that you get a guy who is not just a political expert, but has real intellectual horsepower. It would be a policy champion and not a seat warmer in that job. So a big upside if he can figure out a way to pull it out.

GIGOT: But, as James said, the Democrats are not supportive of --

BILL MCGURN, COLUMNIST: Right.

GIGOT: -- aren't supportive of Trump.

MCGURN: Right.

GIGOT: And Northam is trying to hang Trump around Ed Gillespie.

MCGURN: Right. I have known Ed for 30 years as colleague in the White House. He is as conservative as they come. Unfortunately, the campaign is not quite on his issues. It is sort of a referendum on Trump in that that was the state, the only southern state that Hillary Clinton took. Trump has only 35 percent popularity. But it is really skewed. Ninety-six percent of Democrats have a disapproval of Trump.

GIGOT: Right.

MCGURN: So I think that though there are intra-Republicans fights, you know, Ed's always called establishment. I mean, he's the most conservative guy I know.

(LAUGHTER)

It's kind of a ridiculous title just because he served President Bush and he came in at a low point.

But I think his worry is that he doesn't want to galvanize the anti- Trump forces on the other side, on the Democratic side. That's what they are banking on.

GIGOT: Isn't he being hurt by the fact, Dan, that the person that ran against him in the primary was a Trumpian and said he wasn't conservative enough, and has not endorsed him.

DAN HENNINGER, COLUMNIST & DEPUTY EDITOR: Yes. That is a problem. I think, though, you know, Trump supporters among Republicans is overwhelming in Virginia, virtually 90 percent. It's not is not quite true that all Democrats are going to vote for Northam, because one of the issues in there is that, down in the southwest part of the state, which is coal country, Democrats down there are talking about voting for Gillespie. They think they have been abandoned by the Democratic Party, which now, instead of thinking about basically white people that work in coal mining, the Democrats are trying to assemble minority voters, and then that upper-class cosmopolitan vote in northern Virginia.

(CROSSTAKL)

HENNINGER: Ed Gillespie has to worry

(CROSSTALK)

HENNINGER: But Ed Gillespie has to worry -- those are -- some are Independents, and Ed Gillespie has to worry about what they think about voting for a candidate and an ally to Donald Trump. That's the X factor. Trump's behavior and so forth. And that's what Northam is trying to do is tar Gillespie with the sort of volatile side of Donald Trump.

GIGOT: And Gillespie is trying to use some issues that Trump has used, immigration, for example. He has a run and an on MS-13, the gang, immigrant gang that he says Northam is was soft on sanctuary cities, and try to use that against him. So Gillespie is trying to use that to mobilize Republicans.

FREEMAN: Yes. I do think the challenge though -- and this is for all Republican candidates there -- as Washington gets bigger, which it always does, that part of the vote in the northern part of the state, heavily influenced or heavily including people that work for the government or have contracts with the government. So it is a state that is increasingly trending that way. I think that's, along with the Trump problem, that is a challenge for Gillespie.

GIGOT: But you said, Bill, the issues aren't working for Gillespie. Does that mean because immigration --

MCGURN: Yes --

GIGOT: -- and he's also running on the Confederate -

MCGURN: Yes, I'm not saying they're not working. I'm saying they just don't play to his strength. He does have a tax proposal.

(CROSSTAKL)

MCGURN: I think reduce taxes 10 percent and get some economic revival. But he's been forced by this campaign into the gang violence and stuff

GIGOT: Yes.

MCGURN: -- where he has some sensible positions of it. But, look, again, one of the problems is the state is changing. Hillary took that state with more votes than Obama did, I think. So it's changing in the direction that is not favorable to Republicans.

GIGOT: All right.

When we come back, the Boy Scouts announced plans to admit girls into their program. Critics say it is a surrender in the cultural war. But is the reality more complicated than that?

(COMMERCIAL BREAK)

GIGOT: The Boy Scouts of America announcing some historical changes this week. The 107-year-old organization says it will allow girls to join the Cub Scouts beginning next year and will start a program for older girls to become Eagle Scouts by 2019. The Boy Scouts' board of directors, which approved the plan unanimously, said the changes were needed to provide more options for parents and families. But some critics say the move amounts to a surrender in the culture war.

We are back with Dan Henninger, Bill McGurn, and Wall Street Journal assistant features editor, Adam O'Neal, and former Eagle Scout.

I guess you are never a former Scout. Once an Eagle Scout, always an Eagle Scout.

So why did -- what -- this is not a totally gender-neutral proposal. Still going to allow for some gender separation, correct?

ADAM O'NEAL, ASSISTANT FEATURES EDITOR: Right. What a lot of people don't know about the Boy Scouts is it actually offers a lot of programs. There's Cub Scouts, Sea Scouts. Some of them are already mixed gender. What they've done this week is they announced that, starting in 2018, girls could join the Cub Scouts. And they are developing a program that should be ready by 2019 to let girls have their own Eagle Scout program --

GIGOT: OK.

O'NEAL: -- under the Boy Scout umbrella. The caveat to this, that you alluded to, is that it's going to be a mixture. If you like your current Cub Scout pack, you can keep your Cub Scout pack --

(LAUGHTER)

-- the way it is, all boys. But they can integrate some of them, if they would like to.

GIGOT: OK. But still a historic change.

I was a Boy Scott, not an Eagle Scout.

Dan was a Boy Scout.

That would be a big cultural change. Why did they do this?

O'NEAL: I think there are two reasons. One is a million people have left Scouts since the turn of the century. Fifteen, 17 years, a million people have left.

GIGOT: Wow.

O'NEAL: That's 33 percent. The Girl Scouts are getting hit harder. But this is still terrible. And the Boy Scouts were looking around and said, how can we expand. This seems to be a natural way.

But I don't think it's that simple. You also the media pieces and the spattering of lawsuits, and girls who said, why can I can't I do what my brother does. They learned, after getting beaten up about gay Scouts and transgender Scouts for years, I think they saw this as a compromise. You can let them in, but we're going to set things up on our terms.

GIGOT: So if there are people within the organization that really do want to stay all boys, they can do that. But this means maybe it will take some of the heat off of them from the critics?

O'NEAL: That's what the goal is. But like I said, will it come to fruition like that other promise about keeping your plan did?

(LAUGHTER)

We'll have to find out.

GIGOT: Bill, hopeful take, cultural here, from Adam?

MCGURN: Yes, I think it is a hopeful happy face. I think there's a couple of things on this. I never got past second-class, so take my opinion for what it's worth.

(LAUGHTER)

I don't think we can blame the Scouts. One of the things, one of the reason for this drop, the Scouts have been public enemy number one to a lot of left-wing groups that have pushed them off the public square.

GIGOT: Because of the gay Scouts issue?

MCGURN: The gay Scouts issue.

(CROSSTALK)

MCGURN: -- gay Scouts issue, really because of the left's objection to anything that celebrates boys and masculinity. Let's face it, that's what it is. That's why the Girl Scouts are made. The Girl Scouts have gone down the social justice warrior path. And they are worried that maybe more traditional families might find the Boy Scouts more attractive. Look, it is just this war on boys and masculinity. We complain about guys like Harvey Weinstein, and that there's no character, and then we need those organizations that have been very good with trying to -- I think it's -- I think maybe the Scouts didn't have any choice, but it's sad.

HENNINGER: What Bill just said about the Girl Scouts may be precisely the reason a lot of girls' families want to get them into the Boy Scouts.

MCGURN: Yes.

HENNINGER: Exactly. And, look, Adam made it up to Eagle Scouts. The three of us didn't.

(LAUGHTER)

All of the Eagle Scouts that I know are solid citizens. And what could be bad about women becoming Eagle Scouts in terms of what we're talking about, the culture wars?

GIGOT: Adam, to Bill's point, I've seen some writing since the move from the left and they are very critical of this. They're not giving the Boy Scouts a lot of credit somehow. And it does tend to reinforce Bill's point.

O'NEAL: They don't like the word "Boy Scouts." And how long are we to keep that? Look, there are aspects of programs for boys that boys love. We're talking about computer programming, and at a time when we are trying to get kids off of their Xboxes and cell phones, there is something that comes. We have all been camping, learning some resilience and some things done as boys.

GIGOT: How are they going to -- how are they going to make this work internally? Is there going to be any resistance from the Boy Scouts internally?

O'NEAL: That's harder to say. I think the way that they've set it up in saying, if you don't want to have girls in your pack, in your troop, you don't have to. If they can keep that and they can stay strong on that, I think, internally, there will not be a ton of resistance. It doesn't hurt me if a girl gets to Eagle Scout. I think that's great. Most of the Eagle Scouts -- I called some of my friends. I was shocked at how my Eagle Scouts friends I have. They did not really care. They thought, that's fine, you know, when I explained that that's how it's going to be.

GIGOT: OK. Thank you, Adam.

We have to take one more break. When we come back, "Hits & Misses" of the week.

(COMMERCIAL BREAK)

GIGOT: Time now for our "Hit & Misses" of the week.

Dan, start us off.

HENNINGER: Well, Paul, it saddens me to say that I'm giving my miss to Marvel Comic books, which I love. I grew up reading them. I love the Incredible Hulk, the Silver Surfer, especially.

(LAUGHTER)

But Marvel comics has broken a prospective tie-in with Northrup Grumman, who make these high-tech planes and so forth. And why did they do that? Because some of Marvel Comic books' current fans, super hero fans on television, started a media campaign objecting to the fact that Marvel was connecting to a military contractor. What do these -- these people apparently think, Paul, all of the wars American fought were actually won by the Fantastic Four and Captain America.

(LAUGHTER)

It's too much.

GIGOT: Northup Grumman makes the B-2 bomber.

James?

FREEMAN: Paul, this is a miss to the Communist thugs who still run China. You can kind of forget when you look at what looks like a modern economy that it is still an old-fashioned Communist dictatorship. But they are reminding us by their demand that the government get ownership and board seats at some of the biggest, fastest-growing tech companies in China. They don't like that these sorts of private firms have gotten bigger than state-owned enterprises. And now Tony Soprano wants a piece.

GIGOT: All right.

Bill?

MCGURN: Paul, a hit to a man who will soon receive the nation's highest award for gallantry and valor, the Medal of Honor. His name is Gary Rose. He served as a combat medic in Laos with the Special Forces Unit, fighting the North Vietnamese. In 1970, he found himself in this horrible firefight, including the shooting down of his helicopter. He saved a lot of lives. So a big salute to Mr. Rose and the many Vietnam vets that fought beside him, and those who are alive today because of this good man.

GIGOT: All right. Thanks, Bill.

That's it for this week's show. Thanks to my panel. Thanks to you for watching. I'm Paul Gigot. Hope to see you right here next week.


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