Former CIA operative explains why he's running for president; Media goes after Ivanka Trump over maternity leave

This is a rush transcript from "The Kelly File," August 8, 2016. This copy may not be in its final form and may be updated.

TRISH REGAN, GUEST HOST: Breaking tonight, Republican nominee Donald Trump revving up a potential campaign reset in the motor city with a big speech on one of the two key issues that analysts believe could help him defeat Hillary Clinton.

Welcome, everyone, to "The Kelly File." I'm Trish Regan in for Megyn Kelly tonight. Today Mr. Trump gave a major speech on the economy, a speech that's raising expectations and exciting his base while also raising eyebrows from his opponents. Trump's 60-minute-long speech zeroed in on what we need to do to get our economy growing again in the way of lower taxes for individuals and corporations. Less regulation, better trade agreements, and child care tax credits for working parents.

Trump also took aim at the left's economic policies that he says have destroyed the middle class. Now, there were no insults at fellow Republicans today, and Trump refused to let the protesters steal the show, though they tried. The Donald Trump we saw today, the billionaire, the entrepreneur, a man who knows firsthand what regulation does to growth, came across to his supporters as a politician with a stronger, tighter message. A message focused on restarting our challenged economy.  Simultaneously, he went after Hillary Clinton. Watch.


DONALD TRUMP, R-PRESIDENTIAL NOMINEE: The city of Detroit is the living, breathing example of my opponent's failed economic agenda. If you were a foreign power looking to weaken America, you couldn't do better than Hillary Clinton's economic agenda. Hillary Clinton short circuited again.  She accidentally told the truth and said that she wanted to raise taxes on the middle class. Hillary Clinton says her plan will put a lot of coal companies and coal miners out of business. There will be no change under Hillary Clinton. Only four more years of weakness and President Obama.


REGAN: Now, in just a few moments, we will speak with Steve Moore, the man who helped right Donald Trump's speech, along with Robert Reich, former labor secretary under President Bill Clinton.

But first, let's go to campaign Carl Cameron, chief political correspondent who is in Detroit. Carl.

CARL CAMERON, FOX NEWS CORRESPONDENT: Hey, Trish. Welcome to Cobo Center in downtown Detroit where Donald Trump today addressed the Detroit Economic Club. A policy wonk oriented organization, and there wasn't a lot of the kind of talk that is customary here, how to reduce the deficit, how to balance the budget, that sorts of things. Instead, it was mostly an enunciation of Trump's goals and priorities. Not a lot of specifics but there was a big revision.

He talked about how he would reduce the number of marginal tax brackets from the current number down to three and revised his numbers upward.  Early in the campaign, Trump said that he would have only three brackets, 10, 20, and 25 percent. A dramatic reduction from the current highest bracket of 39 percent taxes. That has now been revised, and Trump says that there will be three brackets, 12 percent, 25 percent, and 33 percent, an increase from what he had proposed, but it puts him in line with House Republicans and Paul Ryan, who have proposed tax reductions with those brackets in those rates.

It's a very big deal. Apart from that revision, what really this was today was a speech in which Donald Trump went after Hillary Clinton, saying that she has all of her political life embraced the policies of failure. Watch.


TRUMP: Every policy that has failed this city and so many others is a policy supported by Hillary Clinton. She supports the high taxes and radical regulation that forced jobs out of your community and the crime policies have made you far, far less safe.


CAMERON: Trump reiterated his commitment to make child expenses fully deductible and suggested that he will do away with carried interest, a darling of Hedge Fund and Wall Street bigwigs that's allowed them to escape a lot of taxes. Trump from the earliest stages of his potential campaign said that this was one of the things that he was going to change in order to make taxing more fair -- Trish.

REGAN: All right. Thank you so much, Carl. Will Trump's economic and tax plan work? And importantly, will it help him right now with voters.

Joining me, Stephen Moore, Trump economic adviser and a FOX News contributor, along with Robert Reich, professor at UC Berkeley. And a former labor secretary under President Clinton. Good to see both of you, guys.

I'm going to start with Stephen. Stephen, Trump says lower taxes, less regulation. It will unleash American prosperity. Now, you know I'm a business reporter. I spend a lot of time covering the economy. So politics aside, these are, in most economists' minds, generally healthy ideas for the economy. But how could he do it? I mean you heard Carl hit him on specifics. How could he do it and if he does, what kind of growth are we talking about?

STEPHEN MOORE, TRUMP CAMPAIGN ECONOMIC ADVISER: Well, great to be with you, Trish. And by the way, I just do have to make a political point because we all know that the last week was a pretty bad one for Donald Trump. And he needed to swing for the fences today, and, you know, he knocked this thing out of the park. I mean there was an air of electricity in that convention center in Detroit. And there's a reason he gave that speech in Detroit. Detroit really is the embodiment of the failed liberal policies of the last 30, 40 years.

Now, you asked the question, can he do it? And the answer is yes. Look, every time we've cut taxes, whether you go back to John F. Kennedy in the 1960s or Reagan in the 1980s, we've had more growth. And by the way, one of the most important points of the economic program that was announced today, you haven't mentioned yet, which is businesses. Small businesses and big businesses will now pay a 15 percent tax. Now, Trish, you know this from FOX Business news. The United States of America has the highest business tax rate in the world.

And how many times have you reported on great American companies like Burger King and Pfizer and others that are leaving the United States because our taxes are so high? And we really believe you bring those taxes down and the regulations, you're going to bring a lot of those companies back to Michigan and Ohio and Pennsylvania and Illinois, and you're going to regenerate growth. So the way you get the deficit down, Trish, is you build -- rebuild the American economy.

REGAN: I know, you're going to grow the economy and therefore -- yes. You know, then you bring in more tax revenue. That's the thinking anyway. But Bob Reich, you have a problem, and always have with this sort of lower tax idea as a way to unleash prosperity. So what is your main complaint?

ROBERT REICH, LABOR SECRETARY UNDER PRESIDENT CLINTON: Well, first Trish, let me say something very positive. I want to salute Stephen Moore for his handiwork, his fingerprints were all over that Trump speech today, and Stephen, what you did is you walked Donald Trump away from the abyss of sheer lunacy back toward the normal --

MOORE: Thank you, Bob.

REICH: Normal nonsense of supply-side, trickle-down economics.

REGAN: All right. We can count on Bob for that, anyway.


REICH: I think that's real progress. I mean, look it, this is basically what Paul Ryan has been urging. Donald Trump is now lining himself up with Paul Ryan. And the problems with it are a couple. These are the classic problems with supply-side, trickle-down economics. Nothing trickles down.  You don't really change the average, you know, working person's life. You just give huge tax benefits to the wealthy, and also you very often end up with huge deficits. Now, we've seen this again and again, Trish. And I'm not saying anything that's new. But I am speaking as somebody who was the labor secretary in Bill Clinton's administration, and the Clinton years were pretty good. I mean, 22 million new jobs.

REGAN: With all due respect. Bob is right. One of the problems with our current economic situation is, you know, whether you want to go after trickle-down economics, you can look at the current situation and know that it actually hasn't worked. I mean Stephen Moore, you look at the jobs picture right now and, yes, unemployment is decreasing. But the reality is nobody is making any more money. In fact, wages, they have been stagnant for 20 years. When you look at the opportunity that people have now, it's not the same as it was 30, 40, 50 years ago. So, you know, I'd like you to answer Bob here, as he says, this trickle-down theory, it doesn't work. It won't.

MOORE: Well, a couple of things. I mean, first of all, it certainly hasn't worked what we've done over the last seven-and-a-half eight years.  I mean, we've had the weakest recovery since the great depression.  Americans haven't had a pay raise now. This is the first time we've had a recovery, so-called recovery from a recession where middle class families didn't make any ground. In fact, they've lost some ground in this recovery. And the real unemployment rate, as Donald Trump said today, I mean the biggest joke in America is that we have a five percent unemployment rate.

It's closer to 10 to 15 percent when you include all these people out of the workforce. So, we believe that by lowering taxes on business and getting the regulations off businesses, you're going to grow the businesses, Bob. And once you grow those businesses, guess what, they're going to hire more workers. They're going to pay more money. And what I don't understand, Bob, and maybe you can address this. I mean, Hillary Clinton says she actually wants to raise the taxes.

She wants to raise the capital gains taxes which is how small businesses are financed. She wants a four percent surtax on small business owners and wealthy people. That's going to take more money out of the businesses.  Bob, how is that going to create more jobs?

REICH: Well, just let me say Steve. First of all, Moody's analytics, which is not a left-wing organization -- I mean Moody's analytics looked at Hillary Clinton's plan and said, it would create 10.1 million net new jobs.  And I was in the Clinton administration. We created 22 million net new jobs, not because we reduced taxes. We raised taxes. What did we do? We invested in the American workforce in terms of infrastructure and education. We also made sure that the American income tax credit was expanded. So, most people actually kept more of their income if they were low income people. We made the economy fairer, and we also invested in our workforce -- Steve.


That is the way you create jobs.

MOORE: Bob, if I actually thought that Hillary Clinton would govern the way Bill Clinton did, I might actually vote for her.

REICH: I'm going to quote you on that.

REGAN: We'll leave it there, guys. You got a compliment on both sides.  Thank you so much.

MOORE: If you look at what happened under Bill Clinton, dramatic reductions in government spending. We did the capital gains tax. We did welfare reform, a lot of those under Newt Gingrich and Bill Clinton. And that was when the Democratic Party was moderate. Trish, my problem is that Hillary and the Democrats have moved so far to the left, one of the areas that we're going to talk a lot about in this campaign that Donald Trump talked about was energy policy.

REGAN: There's a lot there to talk about. Unfortunately we're out of time. Stephen Moore, thank you so much. Robert Reich, thank you.

REICH: Thank you.

REGAN: Good to see you guys.

All right. It's worth mentioning that at the same time Donald Trump was laying out his vision for making the economy great again, with one of the policies, the Child Care Tax Credit aimed at helping working women, the media was going after Ivanka Trump. Trump's famous daughter known for defending her daughter and for also playing not just a big role in his company but separately, running her own fashion company. So here's what they're getting her on.

Apparently her fashion company partners with another company which is under attack for not offering paid maternity leave. The revelation leads the Washington Post to proclaim, "Ivanka Trump champions working moms, except the ones who design her clothes."

Howie Kurtz, host of "MediaBuzz" joins me now with more. And, you know, Howie, I was wondering when they were going to start in on her. Today apparently is the day. But what do you think? Is there anything here to this story, or does it just make for one sexy headline?

HOWIE KURTZ, HOST, "MEDIA BUZZ": Well, Ivanka is fair game for the press given her role with her father. But this story, I got to tell you, is as thin as hand-me-down lingerie. It's based on one complaint from an unnamed woman. It doesn't involve Ivanka's own clothing company, which offers eight weeks of paid maternity leave and flexible hours for new parents. But a company whose work she licenses, which follows the law by the way, but offers 12 weeks of unpaid maternity leave. So is Ivanka responsible for the personnel practices of everyone she does business with?  I don't think so.

REGAN: Well, apparently The Washington Post might think so. But you say that she's fair game. I mean, I just wonder about that. I mean, do we see the left coming out and attacking Chelsea Clinton for whatever issues she might have had along the way? I mean don't you think that there is a little bit of a bias or a reason for them to go after members of Donald Trump's family in a way that we don't necessarily see on the other side, Howie?

KURTZ: Well, I don't think she's fair game personally, but in terms of her business record and the fact that, you know, she spoke at the Republican convention. I'm just saying, I don't consider her to be off limits completely. But to come back to the -- my problem with the story, it was so determined to show that this was the sort of a rich girl, a hypocrite because she claims to care about working moms. It had such a condescending tone. It began with her Republican convention speech in a blush tone dress --

REGAN: And by the way, 158 bucks? Pretty nice dress.

KURTZ: But then the story goes on and on. It dredges up a 1994 quote from Donald about putting a wife to work can be dangerous with reference to his then-divorced wife Ivana. And then finally this to me reminds me, Trish, of the New York post publishing those 20-year-old nude modeling photos of Melania. In other words, it's a way of getting at the candidate by attacking his family.

REGAN: All right. Howie Kurtz, thank you so much.

KURTZ: Great to see you.

REGAN: Ignore for a minute what the media is telling you right now about polls and consider this. What if we were heading into November, and this race was actually literally too close to call?

Chris Stirewalt raised that exact question today, and he is here to explain why that scenario is very much a possibility.

Plus, a new Republican challenger today announced he is joining the race for the White House, and he's here next.

Plus, a dramatic new headache for Hillary Clinton after reports surface that a U.S. spy discussed on Hillary Clinton's unsecure e-mails has now been executed by Iran. Judge Napolitano is in the House. He'll explain.  I'll see you here in two.


Does the department think and some have even charged that there's a link between that appearance and unclassified e-mails and the prosecution and execution of Dr. Amiri. Does the department see any linkage between the two?



REGAN: Developing tonight, about three months out now until "Election 2016," and a new poll from Monmouth University has Clinton at 46 percent support among registered voters compared to 34 percent for Donald Trump.  The Real Clear Politics average points to a slightly tighter race with Hillary at 47 percent and Trump at 40 percent. My next guest says no matter what the media is saying -- and we've heard a lot lately -- a neck and neck race heading into November is not out of the realm of possibility.

Chris Stirewalt joins me right now. He's our Fox News digital politics editor. Chris, good to see you.


REGAN: Walk me through here your scenario. How do you see this playing out?

STIREWALT: Well, so far what we see in that Monmouth poll and other polls, this is the low end for Donald Trump. This is the bottom end of his support. He's got a range that's between the mid-30s to the mid-40s, maybe 46, 47. Hillary Clinton has a range too. Her range is from about 50 percent down to the low 40s. So you can imagine a moment if these two candidates stay within these bandwidths that if he's at his high point and she's at her low point three months from tonight on Election Day, guess what? He could win.

He could win a narrow election, and that could be very challenging for this country because, remember, a big part of Donald Trump's success is saying that everything is rigged, that the country is a fraud, that things are falling apart, that you can't trust people, and that there's a conspiracy against ordinary folks. If you have -- and that energy is on the left and the right, whether you're Elizabeth Warren or whether you're Donald Trump, that's all out there. If we get into a 2000 Bush v. Gore situation, things get pretty dicey out there.

REGAN: I would imagine. Now, let me ask you about polling data and historically how it spent. I mean, there have been recent -- in recent times, situations in which the polling hasn't held up in terms of, you know, say August in 1988, Dukakis was ahead in the polls yet failed to win the presidency.

STIREWALT: Well, sure. Just because the polls say something today doesn't mean that's what it's going to be three months from today. We're exactly halfway between Donald Trump clinching the nomination and Election Day. So we're exactly at the hinge point in the election. We're halfway home.  Now, things can change a lot over that period of time, and even if it just stays within that bandwidth it can change a lot. I would remind you -- this is really important. The polls are mostly accurate. Good polls have mostly been accurate, and we have never seen a presidential election blown.  We're looking for the trend lines over the next three months.

REGAN: Do you think he helps himself today by getting back to the economy as his main message?

STIREWALT: It's his best message. It's the things that voters trust him the most on consistently. That's his best place to be. He ought to say there.

REGAN: All right. Chris, thanks so much.

STIREWALT: All right. As you just heard moments ago, there is a new face shaking up the 2016 presidential race. Evan McMullin is a Never Trump conservative who officially announced his independent bid for the presidency earlier today.

And now in a KELLY FILE exclusive, he's telling us why he wants his name on the ballot.

Joining me right now, Evan McMullin, a former CIA officer who most recently served as chief policy director for the House Republican Conference.  Welcome, good to have you here.

EVAN MCMULLIN, FORMER CIA OFFICER: Thank you, Trish. Good to be here.

REGAN: All right. Why are you getting in now?

MCMULLIN: Well, I'm getting in now because I firmly believe that both candidates are woefully unprepared and woefully unfit for the responsibilities that they seek. And I think our country is desperate for a new generation of leadership. I think that's clear. Americans are so unsatisfied with the direction of the country, and then to have two candidates whose negatives are so high. There's just a lot of frustration out there.

REGAN: But, again, I guess, just question the timing of it because apparently 26 states have already basically closed the opportunity for you to get on the ballot there. So that would make it extraordinarily difficult for you to get the votes that you need to win the presidency.

MCMULLIN: Well, a couple of things. First of all, their petition deadlines may have passed, but there are other means to get on those ballots. So, let's just say that. I've got a great team, they've been studying this for months. And through a variety of means, we expect to be on a broad number of ballots and to compete, and to compete to win. You know, with regard to the timing of this, yes, it's not ideal. In fact, for months, I as well as many Americans have not longer hoped that someone with national name I.D. would step up and do what I'm doing. I believe that this is the last moment when somebody can offer credibly still an alternative to these two unfit candidates.

REGAN: So you're a lifelong Republican.

MCMULLIN: I am. I would say I'm a lifelong conservative before that.

REGAN: Okay. Are you okay, then, with Hillary Clinton getting elected?  Are you okay with your taxes going higher? Are you okay with her picking the Supreme Court justices?

MCMULLIN: Listen, the suggestion then is that I somehow would force her to win. Donald Trump is losing badly already to Hillary. I've just entered the race today. He's doing terribly, and he can't keep his foot out of his mouth. And today --

REGAN: But you just heard Chris say, you know, look it's early. There's still more than 90 days to go. And you know, polls can be meaningless when you finally going to the ballot box. And there are polls out right now that suggest he is actually running quite tightly with her in some states.  So the thinking would be that you might pull away some of those votes, therefore tipping the favor to Hillary Clinton.

MCMULLIN: Donald Trump is losing badly now according to the polls, according to the Real Clear Politics average poll, even which is, doesn't necessarily reflect the current situation. And it still shows that he's quite a bit behind. Donald Trump keeps saying terrible things that alienates large swaths of the population. He's wholly unfit. I think in fact he's dangerous to the country. And by the way, he is not a conservative. The idea that Donald Trump is a conservative is a complete farce. He is a conman who pretends to be a conservative.

REGAN: Wow! Well, those are some big allegations for someone who doesn't want to see Hillary Clinton elected. Anyway, thank you so much.  Unfortunately amount of time. Good to have you.

MCMULLIN: Thank you. I appreciate it.

REGAN: All right. Joining me right now to respond to Mr. McMullin, New York Congressman Chris Collins, co-chair of Donald Trump's U.S. House Leadership Committee.

Good to have you here, Congressman. You know, he says he's really not going to take votes from Donald Trump, but that's I guess one of the concerns here.

REP. CHRIS COLLINS (R), NEW YORK: Well, I don't think he's going to get any votes. I mean, this is kind of a desperate noise in the wind kind of move, Trish. We're not going to pay any attention to this. And I'll say this about the polls, they can't poll energy. The Donald Trump energy -- the reason people are voting for him, he's going to secure the borders, bring our jobs back, defeat ISIS, make America great again, put America first. Hillary Clinton has yet to give a reason why anyone should vote for her. The best she can say is, don't vote for Donald Trump. That's not going to cut it over the next 95 days. And when she steps up in that first debate with Donald Trump, no one is going to be watching an NFL game.

America is going to tune in, and Hillary Clinton, who can't take a question from "The New York Times" and defend what she's trying to defend -- because you can't defend the indefensible on the e-mails, let alone the foundation and Benghazi, you can go on and on. What I'll say is the polls don't mean a whole lot today. I think we just have to look at the battleground states. We have to look at Ohio, North Carolina, Pennsylvania, and Florida. Those are the key states. Donald Trump wins those four states, he's our next president. And I think right now --

REGAN: If he keeps doing what he did today represented, if he keeps doing what he did today, if he keeps hitting the issues -- and by that, I mean the economy. I mean national security. If he stays on message, can he turn this thing around?

COLLINS: Oh, there's no question he can. You know, we had kind of a stumble the last week or so, but I think he's back on message. It is the economy. Eighty percent of the public says the economy is going in the wrong direction. The country is going in the wrong direction. As one of your other folks on the show said, you know, the middle class hasn't had a wage increase in 20 years. More people living in poverty. We need to get the economy moving, and that's going to create the opportunities for wage increases, more jobs.

We're going to bring the jobs back from China. We're going to erect some tariffs to make sure we have fair trade. You know, this free trade nonsense just didn't cut it. So, on jobs and the economy as well as talking about terrorism, Donald Trump has the answers. It's a reason to vote for him, and Hillary hasn't yet given a reason to vote for her.

REGAN: All right. Representative Collins, thank you so much. Good to have you here.

All right. For months, now, everyone, Hillary Clinton has embraced the Black Lives Matter movement. But when police tried to reach out to Mrs. Clinton, her response left them disappointed and shock.

Sheriff David Clarke and Attorney Eric Guster are here on that next.

Plus an alleged spy is referenced in Hillary Clinton's unsecure e-mails.  And then Iran kills him. Judge Andrew Napolitano is just ahead.


UNIDENTIFIED MALE: Does the department think that -- and some have even charged that there's a link between that appearance and unclassified e- mails and the prosecution and execution of Dr. Amiri. Does the department see any linkage between the two?



REGAN: Developing tonight, Hillary Clinton dealing with new controversy concerning police. While the Democrats went out of their way to include cops on stage at the end of last month's convention, when the cameras weren't rolling and America's biggest police group approached the Clinton camp about endorsing her for president, Clinton says thanks but no thanks. Trace Gallagher reports from our West Coast newsroom, Trace.

TRACE GALLAGHER, FOX NEWS CORRESPONDENT: Trish, the National Fraternal Order of Police says it has about 335,000 members, about half of the police officers in the U.S. and the way the presidential endorsement system works is that each candidate fills out one of their questionnaires. The answers are then distributed to members and the various state chapters vote. If two-thirds of the chapters agree on a candidate, the union will endorse.

It was Bill Clinton in '96, George W. Bush in 2000 and 2004 and John McCain in 2008. Neither Mitt Romney nor President Obama got the two-thirds needed in 2012. But Hillary Clinton apparently won't even fill out the questionnaire. The union feels snubbed saying the Clinton campaign indicated right up until the deadline that she would seek the endorsement. The union president says, quoting, "You would think with law enforcement issues being so much in the news, even if she had disagreements with our positions, she would have been willing to say that."

The union has also criticized the Democratic Party for being more focuses on deaths caused by police than officers killed in the line of duty. When asked about the endorsement, the Clinton campaign side stepped, saying, quote, "Hillary and her team have engaged law enforcement throughout the campaign to listen to ideas and solutions, and she will continue to do so as president."

Clinton has gained the support of mothers of the Black Lives Matter Movement and has actively courted the Black Lives Matter Movement, but the founder of BLM says the Clintons, "Use black people for votes but then don't do anything for black communities." Donald Trump is actively seeking the police union endorsement. The last candidate to snub the union was John Kerry back in 2004.

REGAN: All right. Thank you, Trace. So why would Hillary snub the police? Joining us now, Sheriff David Clarke of Milwaukee County Sheriff's office, and Eric Guster, an attorney and political commentator, welcome to you both. Dave, I'm going to start with you. Sherif Clarke, you know it seems to me you want every vote you can possibly get, right? I mean, why would she not want those of the police?

DAVID CLARKE, MILWAUKEE COUNTY SHERIFF: Especially from a fraternal organization of police. Look, everybody that runs for elected office, state, local, federal level, they know they have to have and they seek out aggressively support of first responders, police, sheriff's deputies, firefighters, corrections officers, so on and so forth. Even her husband, who is a better politician on his worst day than she could ever hope to be on her best day, two times sought the support of the fraternal order of police and received it in '96.

He was like a kid in a candy shop. Here is what he said, "For four years I've worked hard to stand with police officers of America and I'm profoundly honored that they have decided to stand with me for four more years." He understood the importance of that. She has had nothing but utter contempt for the American law enforcement officer. This is just another thumb in our eye. She's engaged the law enforcement community, but she's done nothing but slander our reputations.

REGAN: That quote that you just read from her husband, it was, I should point out, at a different time when we didn't have Black Lives Matter taking to the streets. And Eric, could we actually be looking at this and saying this was, in fact, a very calculated political move? In other words, she did not want to be associated with the police because it's too important for her to have those Black Lives Matter votes?

ERIC GUSTER, POLITICAL COMMENTATOR: No, that's not the case, Trish. Hillary Clinton has reached out to police officers as well as people on the social justice movement and it's not just about Black Lives Matter. This is about getting police to be held accountable for the things that some of the bad ones do. And police officers have to start coming forward to report these bad police officers.

Now, back to Hillary Clinton and her endorsement, this is just a union. She's not saying, I don't support the police, but he does support the police. She said it hundreds of time on the campaign trail that she supports their actions.

TRISH: But Eric, she didn't even try -- she didn't even try to get their endorsement. She clearly didn't seem to want it.

GUSTER: No, they vote in September, so she still has time to get the endorsement, Trish.

TRISH: No, the cutoff is over. The deadline came and went. She missed the deadline. She never moved forward. They invited her to do so. And, Sheriff Clarke, she declined the opportunity. Do you think that in fact she's being politically calculating? In her view, she does not want to be associated with the police because therefore that would destroy her support among many members of the African-American community?

CLARKE: Well, sure. She's all in with the criminals. You know, her compassion for criminals is not shared by mainstream America. Most of the American public, a large segment of the American public stands on the side of the American police officer. She knows she has to have a heavy volume of black votes to even contend in this election, but she's not going to outdo Barack Obama, who had a record number in both 2008 and 2012.

And if Obama hadn't outdone himself in 2012 with a new record high for black voters, he would have lost to Mitt Romney. She has no connection emotionally to the black community, and that's why she has to go all in and leave no daylight in her contempt for the American police officer.

REGAN: And look, the black community is clearly struggling right now as we look at crime rates, we look at unemployment, and you look back over the last eight years. And if I were an African-American voter right now that might have been thinking about voting for a Democrat, I think I'd have some serious questions, Eric, because I would want some change. And I don't know if she quite can deliver that or at least in her message, she's not offering that. Does she need to emphasize more change?

GUSTER: Trump isn't the change. As long as Trump keeps on the downward spiral that he's going on, she doesn't need to reach out to the FOP. He has lost so many endorsements from GOP leaders that it is shameful for a GOP candidate to lack that type of endorsement. And what Trump is doing, he is dividing our country. And what Hillary Clinton is trying to do is bring us all together.

She's not saying, I'm all for one side or the other. She wants to bring both sides to the table and let's talk about community actions. Let's talk about making sure the police -- that bad police are held accountable for the things that they do, but also we need to improve our communities as well. So, she's trying to be a healer when Trump is a big divider.

REGAN: You know, it's just tough when you're running on a record in the last eight years, I should think. Thanks so much guys

GUSTER: Well, Trump is running it into the ground.

REGAN: Good to have you guys here. Potentially damaging new fallout from Hillary Clinton's e-mail server scandal. A reported U.S. spy who was discussed on her unsecure e-mails has been executed by Iran. Judge Andrew Napolitano is here on where this could all go next. And just when you thought the story of the "Clock Boy" was over, new drama tonight surrounding him and his school district that led to a lawsuit.


AHMED MOHAMED, ARRESTED FOR BRINGING A SUSPICIOUS CLOCK: I lost a lot of things. I lost my home. I lost my creativity because before, I used to love building things, but now I can't.


REGAN: Developing tonight, the Obama administration ducking new fallout from the latest twist in Hillary Clinton's ongoing private server scandal. Iran announcing the execution of Shahram Amiri, an alleged spy whose fate was discussed over Clinton's vulnerable e-mail system way back in 2010. Yesterday, Senator Tom Cotton said this goes to show how Mrs. Clinton gravely mishandled American secrets.


SEN. TOM COTTON, R-ARK.: The e-mails that were on Hillary Clinton's private server, there were conversations among her senior advisers about this gentleman. That goes to show just how reckless and careless her decision was to put that kind of highly classified information on a private server. I think her judgment is not suited to keep this country safe.


REGAN: Now today, the State Department wouldn't say if Mrs. Clinton's e- mails led to the scientist's death. Watch.


UNIDENTIFIED MALE: Dr. Amiri was referenced in the e-mails of former Secretary of State Clinton.


UNIDENTIFIED MALE: Does the department think that, and some have even charged that there's a link between that appearance in unclassified e-mails and the prosecution and execution of Dr. Amiri? Does the department see any linkage between the two?

ELIZABETH TRUDEAU, STATE DEPARTMENT SPOKESPERSON: So, we're not going to comment on what may have led to this event.


REGAN: All right. In just moments, we're going to speak to Judge Andrew Napolitano who thinks Hillary Clinton may have jeopardized national security. But first, let's go to Chief Washington correspondent James Rosen, who is in Washington with the details on this, James.

JAMES ROSEN, FOX NEWS CHIEF WASHINGTON CORRESPONDENT: Trish, good evening. The Islamic regime said it executed Shahram Amiri because he gave the U.S. vital information about Iran's nuclear program while he was here in the states under bizarre circumstances. Back in June 2009, Amiri disappeared during a pilgrimage to Mecca.

He surfaced a year later posting internet videos in which he claimed ultimately to have been abducted by the CIA, taken to Tucson and tortured and that he was free and safe. Here's what Secretary of State Clinton said about him at the time.


HILLARY CLINTON, DEMOCRATIC PRESIDENTIAL CANDIDATE: Mr. Amiri has been in the United States of his own free will, and he is free to go. He's free to go. He was free to come. These decisions are his alone to make.


ROSEN: Amiri made it to the Pakistani embassy in Washington and there demanded to return to Iran, which he did. Even in announcing Amiri's execution on Sunday, the regime boasted that the U.S. Intelligence community had been duped by Iran.


GHOLAM-HOSSEIN MOHSENI EJEI, IRANIAN JUDICIARY SPOKESMAN: Americans assumed for a while that Iran was not aware of this person's actions or what he was linked to or how he was taken to Saudi Arabia and taken away from there. They imagined that our intelligence was unaware of all of that.


ROSEN: In July 2010 when Amiri's return to Iran was still being finalized, a top energy adviser of Hillary Clinton's, former Ambassador Richard Morningstar wrote to Clinton's deputy chief of staff, Jake Sullivan, referring to Amiri as a, "friend to the United States and suggesting how to massage the issue for public consumption. "We have a diplomatic psychological issue, not a legal issue," Morningstar wrote. "Our friend has to be given a way out.

We should recognize his concerns and frame it in terms of a misunderstanding with no malevolent intent and that we will make sure there is no recurrence." That e-mail was forwarded to the Secretary of State, whose private server was so inadequately secured, the FBI concluded that, "hostile actors may have gained access to it." The Clinton campaign says it's remarkable that anyone would link her to this, "tragic death." Trish.

REGAN: All right. Thanks so much. Here now with more, Judge Andrew Napolitano. And judge, what do you think? I mean did Hillary's e-mail have something to do with this man's execution?

ANDREW NAPOLITANO, FOX NEWS JUDICIAL ANALYST: Well, we don't know because he was tried in a court system very unfamiliar to us, and he was convicted. He was sentenced to death. He appealed it. He lost the appeal. And yesterday, he was apparently hanged. We do know that he did provide us with a lot of information. We do know that American intelligence agencies paid him a good deal of money. He was a classic spy.

He provided information that was fed to Secretary Kerry, who had it in the back of his head or in his notes at the time he was negotiating with his opposite number that produced the Iranian accords. Whatever you think of those accords, we had a leg up on them because of this spy who worked for us. Can you imagine -- imagine if this e-mail was used in the prosecution against him, hear (ph) members of the court as evidence that the American Secretary of State, the great Satan, was referring to you as their friend.

REGAN: If I were a spy anywhere in the world right now, I'd be pretty nervous knowing that Hillary Clinton's e-mail server was not secure, knowing that she could have said the same about me. You refer to someone as a friend. Are you then in danger?

NAPOLITANO: One of the reasons that the -- one of the former leaders of the NSA now in private life suggested that the Democratic National Committee was probably hacked by the NSA is because of the well-known antipathy that the intelligence community has to Hillary Clinton. And that antipathy is based on a couple of things, not the least of which is the reckless manner in which she exposed state secrets, including the names of spies, including the names of moles, including the names of double agents.

And some of those people in the intelligence community had their covers blown by Mrs. Clinton's recklessness, and some of those people in the intelligence community, others believe, never came back home because she blew their cover.

REGAN: And this is because of the e-mail server, because somebody was able to get access to this?

NAPOLITANO: This is because she failed to safeguard state secrets by causing all e-mails to come to her. She didn't write this e-mail that referred to him as our friend, but she was copied on it so, it passed through her non-secure server. Some of information she in turn sent to her friend Sid Blumenthal who had no national security clearance and no security whatsoever on his server, and we know that his server was breached probably by the Iranians.

REGAN: And members of the intelligence community believe that there are people that have been compromised as a result.

NAPOLITANO: And for that reason, they do not want to see Mrs. Clinton in the White House because they believe she's a danger to national security. And the more she lies about this, Trish, put aside the politics, the more she feeds their fear and antipathy.

REGAN: Sure. Judge, good to see you tonight. Thank you so much, sir.

NAPOLITANO: Good to see you.

REGAN: All right, the saga of the so-called "Clock Boy", remember him? It continues. First his homemade clock landed him in hot water with authorities. Then he left the country. Well, guess what? He's back in the USA, and he's filing a lawsuit. The details on that one next.


MOHAMED: Anytime I walk out of the house, there might be death waiting for me so, the best thing for me is that I have to stay overseas, far away. And I really love the States. It's my home, but I couldn't stay.


REGAN: Not a "Kelly File" followup. It was just about a year ago that a boy got in trouble for bringing a homemade clock to school that some said resembled a bomb. Now, his family is suing, saying the principal, the school district, and the city, they all violated his civil rights. Trace Gallagher reports from West Coast newsroom for us tonight, Trace.

GALLAGHER: Hey, Trish. The lawsuit claims the state of Texas and the Irving school district has a history of discrimination against Muslims. So, 14- year-old Ahmed Mohamed and his family are now asking a jury to decide the damages. The family had offered to settle the case for $15 million. The boy, as you'll recall, was arrested last September for bringing a hoax bomb to school. Ahmed claimed he built the clock out of hardware salvaged from his parents' garage and was even applauded by president Obama for his ingenuity and invited to the White House.

But critics later claimed the boy never built a clock. Instead, he took the cover off an old clock, exposing the wires, making it look suspicious. Police eventually dropped the charges, but he was still suspended for three days and ended up leaving the school altogether and moving to Doha, Qatar. The family is now living back in Texas, but Ahmed claims it's no longer safe for him to live here. Watch.


MOHAMED: There is nothing I can do. I've lost a lot of things. I lost my security. I can't walk out on the streets anymore without having to be covered up because I don't want to get shot because it happens here. And it might happen anywhere.


GALLAGHER: Ahmed, who the media nicknamed "Clock Boy", says he got a lot of support in the beginning, but now it's the hate that really sticks. And we should point out the reason his family has now moved back from Doha, Qatar to Texas is because the family could not find work over there. They were living on food stamps and subsidized housing, so now they're back, and he'll go back to school in Qatar.

And we should also point out finally this is still being investigated by the Irving school district, and there is a battle between the state and school district as to whether that investigation ultimately will go public or remain private.

REGAN: Now, I love that the family couldn't find work over there, so they're back here, and now they're suing. Trace, thank you so much. We're going to be right back. I'll see you right here.


REGAN: Thanks so much for watching, everyone. I'm Trish Regan in for Megyn Kelly tonight. I'm going to see you again right back here tomorrow night and every day at 2:00 p.m. eastern on the Fox Business Network. Have a terrific night. "Hannity" is next.

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