This is a rush transcript from "Special Report," October 11, 2019. This copy may not be in its final form and may be updated.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT: We've come to a very substantial phase one deal. We've come to a deal on intellectual property, financial services, a tremendous deal for the farmers, a purchase of from $40 billion to $50 billion worth of agricultural products. I'd suggest the farmers have to go and immediately buy more land and get bigger tractors.
It took us a long time to get here, but it's something that's going to be great for China and great for the USA.
(END VIDEO CLIP)
BRET BAIER, HOST: President Trump in the Oval Office talking about the first phase, as he calls it, phase one of a China trade deal that he hopes will lead too much bigger and broader things. The Dow spent the day in anticipation of this announcement, shooting up on good news, and then it seemed at the very end, when the announcement was made, that there was a little let down about what exactly it all means in the big picture.
So what does it mean? Let's bring in our panel, Matthew Continetti, editor in chief of the "Washington Free Beacon," Susan Ferrechio, Chief Congressional Correspondent for the "Washington Examiner," and Josh Kraushaar, the politics editor for "National Journal." Matthew?
MATTHEW CONTINETTI, EDITOR IN CHIEF, "WASHINGTON FREE BEACON": At first glance, Bret, this looks like a tremendous victory for the president. This is something he has been wanting to do since day one. He's promised to do it. If the I.P. reforms are as he says, that will be an advance in our trading relationship with China. And it shows two things. One, the power not only of tariffs, but also the threat of non-tariff barriers. Remember in recent weeks we've been discussing a lot about delisting Chinese companies from the U.S. stock market and other ways to delink the two economies.
And two, despite all the noise in Washington, when you put this next to the deals with Korea, Japan, and the USMCA, the U.S-Mexico-Canada agreement, President Trump is rewriting the rules of the global trading system, and he's doing so in America's favor.
BAIER: Susan, reaction on the Hill. This doesn't need a Hill component to it, but how does that factor in?
SUSAN FERRECHIO, CHIEF CONGRESSIONAL CORRESPONDENT, "WASHINGTON EXAMINER": They had supported him generally in the China trade negotiations because for a long time Congress has really wanted to address problems with China and their currency administration and intellectual property theft that Matthew just talked about. So they are going to be absolutely thrilled that he's actually accomplished some of those challenges but has also slowed the problem with our economy that has resulted from these trade wars.
You heard the president talk about the farmers. This is a huge issue on Capitol Hill. Fifty percent reduction on dairy exports under this trade war. These people are hurting. He is hearing from members on Congress representing these places that have voted for President Trump, mind you, they want a deal on this and he has accomplished that, at least in form today. The question is can he maintain the details of this, the whole framework. They've only outlined a framework. They haven't settled on the details. What's going to happen in the weeks ahead when they try to really work out and dot the i's and cross the t's.
BAIER: What if here, Josh, politically is, what if he does get some kind of deal, even if it's short of the big thing that they wanted, what if Congress does move forward with the USMCA, and suddenly the benefits to the economy while the impeachment deal is going on are substantial.
JOSH KRAUSHAAR, POLITICAL EDITOR, "NATIONAL JOURNAL": Absolutely. President Trump needed some good news in a pretty tumultuous week and he got it. This is good news for the economy. The Dow is up over 300 points. It's good news for farm state Republicans. One of the areas the president has been a little bit concerned about is his reelection bid is the Midwest, Iowa, a big state, Ohio. Joni Ernst, a farm state senator up on the ballot, has been concerned about the impact of the tariffs. So the fact that we at least have some progress, we have the movement towards a deal is going to give a lot of reassurance to those swing voters that have been with Trump but were a little reluctant on how their own economies were going.
BAIER: I asked about both aspects and how China fits into the investigation. Here's what the president said.
(BEGIN VIDEO CLIP)
TRUMP: China can do whatever they want with respect to the Bidens. China can do whatever they want with respect with $1.5 billion going to somebody. That's up to China. But we do have to look into corruption, but no, it has not been brought up.
(END VIDEO CLIP)
BAIER: Did not bring it up. Today, the president says, meantime, the former ambassador to Ukraine Yovanovitch, Marie Yovanovitch up on Capitol Hill testifying behind closed doors. Her opening statement said among other things, this, "The Deputy Secretary of State said that the president had lost confidence in me, no longer wished me to serve as his ambassador. He added that there had been a concerted campaign against me, and that the Department had been under pressure from the President to remove me since the Summer of 2018. He also said that I had done nothing wrong and that this was not like other situations where he had recalled ambassadors for cause." Some sound about this from lawmakers and the president.
(BEGIN VIDEO CLIP)
SEN. BOB MENENDEZ, D-N.J.: First of all, Marie Yovanovitch is one of the most highly respected ambassadors we have in the career foreign service.
NUNES: She is a Democrat. She is a partisan. It's well documented. This is somebody that was not just supporting the Clintons when Clinton was running, telling the Ukrainians that Clinton was going to win, prognosticating about it, but also once Trump won, was badmouthing the Trump administration in Ukraine, to Ukrainians and State Department staff.
TRUMP: I don't know her, but she may be very much a wonderful woman. If you remember the phone call I had with the president, the new president, he didn't speak favorably.
(END VIDEO CLIP)
BAIER: Matthew, thoughts on today?
CONTINETTI: I think this a sideshow from the main event, which is the president says is the phone call. There's a temptation I think in the Democrats to go down these various nooks and crannies. The fact of the matter is President Trump can recall this ambassador for any reason he wishes. She serves at the pleasure of the president. If the Democrats impeach Donald Trump, it's going to be about that phone call and the whistleblower complaint, not about the ambassador.
FERRECHIO: I disagree with you a little bit. I think the Democrats are trying to build a case of the president is corrupt and he's hiding it. He's trying to hide it through obstruction. That is the case they're building --
BAIER: Strictly on Ukraine, though?
FERRECHIO: Strictly on Ukraine --
BAIER: They are trying to stay focused, laser focused so far.
FERRECHIO: According to the witnesses we have coming in, although I think they may expand it to beyond Ukraine and any other foreign leader he may be enlisting to help investigate Joe Biden and the Democrats. That's what they're saying is part of his not fulfilling his duties to uphold his office under the Constitution. That's the argument they are making.
The obstruction part is that he will not cooperate with subpoenas and witnesses, that he is trying to block witnesses. If you watch what Democrats say on a daily basis when they haul these people in to talk to members of Congress in the basement of the Capitol Hill, they say they warn the president they are building an article in the impeachment case against him based on the fact that they are not willing to cooperate. And I think that's part of what the impeachment articles will look like.
BAIER: It's really interesting because part of this he says publicly, and he said it to the reporters on the south lawn. So if that's an article impeachment, then the other one is obstruction preventing people from testifying or documents going up the Hill.
KRAUSHAAR: It's a tricky case for Democrats to make, but I think the politics of Yovanovitch's testimony were pretty damaging because she painted a picture of an administration jeopardizing natural interest for personal interests. And what Democrats want to do, what Pelosi wants to do is make the impeachment about national security, not about all these side issues like Matthew was talking about, but about just the fact that the national security of the United States is for sale. And Yovanovitch did have something. The opening statements is the only part we saw so far, but there was pretty damning stuff in there.
BAIER: Yes. And the other side is the Nunes side, and he's not alone in how he characterizes her time in that position.
Next up, the Friday lightning round, including Candidate Casino, plus winners and losers.
(BEGIN VIDEO CLIP)
SEN. CHUCK SCHUMER, D-N.Y.: I believe we can't stay in the Middle East indefinitely, but abandoning the Kurds, especially so precipitously, who have fought shoulder to shoulder with our troops against ISIS is morally wrong.
MARK ESPER, DEFENSE SECRETARY: We have not abandoned the Kurds. Let me be clear about that. We have not abandoned them. Nobody green-lighted this operation by Turkey. Just the opposite. We pushed back very hard at all levels for the Turks not to commence this operation.
(END VIDEO CLIP)
BAIER: Defense Secretary at the Pentagon, and you heard the Senate Minority Leader. Back with the panel. Start there. Josh?
KRAUSHAAR: Yes, I think this is a very tough time for the Trump White House, number one, on this issue, because, first of all, Republicans are openly criticizing the president's decision, whether it was greenlit or not. What happened is that Turkey felt that there was some single given that they could invade without pushback. The Trump administration called for sanctions to be put in place, but they haven't actually put the sanctions in place and just put the threat out there.
And I think also it's kind of a bipolar foreign policy because you have got the Trump administration today announcing that they're going to add 1,500 troops to Saudi Arabia to help counter Iranian expansionism, but they took away the 50 to 100 troops that were serving as a buffer between Turkey and the Kurds. So there's a lot of mixed messages coming from the White House.
FERRECHIO: It was only a few dozen troops from the border, still about 1,000 there total, so they haven't changed the total number there. And the president is doing exactly what he said he would do when he campaigned, which is take our military out of these endless wars in the Middle East.
And then as you say, he then went and sent 1,500 more to Saudi Arabia, just giving fuel to the Democrats and Republicans in Congress who are really upset about our relationship with Saudi Arabia to say why are we doing this? If you want to end the endless wars, why are you sending troops to Saudi Arabia who don't deserve our help in the eyes of many people in Congress. So he's not winning many fans for his foreign policy on Capitol Hill.
BAIER: Quickly, one word in one country was the reason for the buildup, and that is Iran. If you look at U.S. troops in the region, 60,000 to 70,000 currently in the Middle East, 14,000 added since May, 3,000 extended, authorized last month. That's what that's about.
CONTINETTI: It's what it's about, and to date it has yet to deter Iran's malign behavior in the region. America has two interests in Syria, one to prevent ISIS from re-forming, and to for preventing Iran from militarizing its presence there. And the Turkish invasion of Syria endangers both interests, and now it's endangering our troops. A cease-fire needs to be a priority for this administration.
BAIER: We are going to do this quickly. We are heading down to Candidate Casino, $100 in chips. You've got to bet. Democratic primary. Matthew?
CONTINETTI: As usual, I'm spreading the risk. I've got $30 on Biden, $30 on warren, but now this week, $40 on the field. Bret, these frontrunners are incredibly weak. I'm thinking someone else may take it all in the end.
FERRECHIO: For now I think it's a race between Biden and Warren, and I'm not ready to give either one of them a lead yet, so $50 on each.
BAIER: Wow, no other chips. Josh?
KRAUSHAAR: I've got $40 on Biden, $35 on Warren, $25 on the field. But I agree with Matthew that there's a good chance that we could see some sleeper, some wild card coming out --
BAIER: Outside of the field that's currently there?
KRAUSHAAR: Outside of the top four.
BAIER: Yes, it's possible. Winners and losers?
CONTINETTI: Bret my winners are the -- my winners are the winners of this year's Nobel Prize in medicine. Their research may revolutionize cancer treatment. It has to do with the way that we use oxygens in our cells, way above my intellect. Congrats to them.
And my loser is Pacific Gas & Electric, which out of fear of lawsuits arising from wildfire plunged more than 2 million people in northern California into blackouts this week. They were pouring money into green projects instead of maintenance. Something is rotten in the state of California.
FERRECHIO: There are affiliated losers with that, though, too. We don't have time for that.
CONTINETTI: Many losers.
BAIER: Winner and loser?
FERRECHIO: My winner is Ellen DeGeneres, and she this week told America what they really needed to hear right now, which is that you can have friends you do not agree with politically.
My loser was the NBA and its players who put themselves in a very bad position by showing that they value profits from China over taking a stand on human rights, and the fans are paying attention.
BAIER: I am told by my team that I'm supposed to ask you to do your loser first and then your winner.
KRAUSHAAR: My loser is Beto O'Rourke who pandered to the LGBT townhall audience, said he wanted to get rid of a tax exemption to churches, synagogues, religious charities. It's a very bad pander, and it's one that's going to cost him. He's not going to be the nominee, but he's losing a lot of swing voters and even a lot of Democrats with that kind of appeal. And he also only raised $4.5 billion, one of the least among of the top tier candidates.
BAIER: And your winner?
KRAUSHAAR: Washington Nationals, first time in the National League championship series playing tonight against the St. Louis cardinals. This is one of the things that this city can unite around, Republicans, Democrats at Nats park cheering for the same team.
BAIER: I now understand why they asked me to do that. I have a lot of Nats fans on the staff, including me. Go Nats.
When we come back, "Notable Quotables."
BAIER: It's Friday night, and that means "Notable Quotables."
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I could see the flames coming over that ridge. I said, we've got to go.
UNIDENTIFIED MALE: Everything, the houses, everything is on fire. It's bad.
SEN. LINDSEY GRAHAM, R-S.C.: If we pull out, the Kurds are in a world of hurt and ISIS comes back, and President Trump will own it.
TRUMP: They didn't help us in the Second World War, they didn't help us with Normandy.
UNIDENTIFIED FEMALE: It should not be OK to discriminate against someone simply for being who they are.
ELLEN DEGENERES, COMEDIAN: Just because I don't agree with someone on everything doesn't mean that I'm not going to be friends with them.
SEN. ELIZABETH WARREN, D-MASS., PRESIDENTIAL CANDIDATE: Just marry one woman, assuming you can find one.
UNIDENTIFIED MALE: Chairman Schiff is acting like a malicious Captain Kangaroo.
REP. ADAM SCHIFF, D-CALIF.: We are determined to find the answers.
UNIDENTIFIED MALE: They are all being told basically by China, Nike, shut up and dribble.
RUDY GIULIANI, PRESIDENT TRUMP'S ATTORNEY: I have to go in the arena with Spartacus? I don't know if I could handle it.
SEN. CORY BOOKER, D-N.J., PRESIDENTIAL CANDIDATE: I would savor the opportunity.
TRUMP: We have nothing to do with it.
JOE BIDEN, D-PRESIDENTIAL CANDIDATE: He should be impeached.
TRUMP: He was only a good vice president because he understood how to kiss Barack Obama's ass.
BIDEN: He gave me a kiss. I swear to God.
SEN. KAMALA HARRIS, D-CALIF., PRESIDENTIAL CANDIDATE: My pronouns are she, her, and her.
UNIDENTIFIED MALE: Mine, too.
HILLARY CLINTON, FORMER PRESIDENTIAL CANDIDATE: Maybe there does need to be a rematch. Obviously, I can beat him again.
UNIDENTIFIED MALE: Even in our currently polarized nation it's my hope that the facts will win the day, that the truth will always matter, that journalism and journalists will thrive.
(END VIDEO CLIP)
BAIER: Shepard Smith, he always says breaking news changes everything. This afternoon breaking news changed everything, breaking news that Shep was leaving FOX News Channel, his last broadcast today. I first started working with Shep on my first assignment almost 23 years ago. That was not it. He anchored breaking news, fast moving events better than anyone. This picture, actually, is of us at the Pentagon, I'm at the Pentagon, live pictures coming in covering the war in Iraq real time, and we are just bouncing around the world with live pictures. He did it better than anybody in the business for years and years and years, from the beginning of FOX News Channel. And I wish Shep all the best in whatever lies ahead, because FOX is less tonight on the breaking news front because he's not here.
Thanks for inviting us into your home tonight. That's it for this “Special Report,” fair, balanced, and unafraid.
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