This is a rush transcript from "The Story with Martha acCallum," January 2, 2019. This copy may not be in its final form and may be updated.

SANDRA SMITH, FOX NEWS HOST: Thank you to you, Bret. Happy New Year to you. And breaking tonight.


PRESIDENT DONALD TRUMP: It could be a long time and it could be quickly. It could be a long time. It's too important to subject to walk away from.


SMITH: President Trump not budging on the border wall. Vowing to keep the government partially shut down for a quote, "as long as it takes." And calling out Democrats and past administrations for putting the needs of other countries above our own.


TRUMP: We spend in Afghanistan more in one month than what we're talking about for the wall. Think of that. The $5 billion -- $5.6 billion approved by the House is such a small amount compared to the level of the problem. When you see that the Democrats want to give away $12 billion extra and we're giving away $54 billion in foreign aid. So, we give money to countries, but we don't give money to our own country.


SMITH: Some of those Democrats hunkered down with the president and Republican leaders in the Situation Room just a short time ago. A room within the White House typically reserved for matters of national security, underscoring the urgency of the border issue. Republicans and Democrats emerging from that room with very different takes.


SEN. CHUCK SCHUMER, D-N.Y., SENATE MINORITY LEADER: It is not helping the president, it is not helping the Republicans to be the owners of this shutdown. Today, we gave them an opportunity to get out of that and open up the government as we debate border security.

REP. KEVIN MCCARTHY, R-CALIF., HOUSE MAJORITY LEADER: I was a little disappointed with -- I would say, some on the other side. They wouldn't -- once the secretary started, they -- the Senator Schumer interrupted her and they really didn't want to hear it.


SMITH: Well in moments, House Majority Leader Kevin McCarthy, who you just saw there takes us inside that meeting. But first, exclusive reaction from the White House with deputy press secretary Hogan Gidley.

It's been a heck of a day. The cabinet meeting, the meeting in the Situation Room. I know you were there for both of them. Did anything change today?

HOGAN GIDLEY, WHITE HOUSE PRINCIPAL DEPUTY PRESS SECRETARY: I'm not sure, only because Democrats refused to acknowledge the facts. What the president did today was monumental. He brought them to the White House, to the Situation Room, to have a conversation with Secretary Nielsen so she could brief them on all the crisis that's going on in the border.

These numbers are devastating, they are sad, they are needless, and they are senseless. And Democrats wanted nothing to do with it. In fact, the president opened the meeting. He then turned to Secretary Nielsen, introduced her and said, "Now, she's going to begin her briefing."

Within five seconds, Chuck Schumer prompted Nancy Pelosi to cut Secretary Nielson off which she dutifully did within seconds. And then the entire presentation was basically over. I bet that the secretary probably said 50 words in the entire presentation. Which tells you a couple of things. One is the Democrats didn't know, didn't believe, and didn't care about anything Secretary Nielsen had to say. Had they been there to listen instead of talk?


SMITH: Well, first, do you -- did you truly believe that, that they don't care to hear what the DHS secretary has to say? Or do you think that maybe this was not their expectations for the briefing?

GIDLEY: There's -- there is no other explanation when you sat through what I sat through. Had they listened? Had they been able to understand? Had they believed the information? They would now know that CBP has arrested 17,000 convicted criminals in one year coming into this country.

ICE has detained almost 4,000 known or suspected terrorists. Thousands of gang members have been arrested in our border, as well. Nancy Pelosi refused to listen to those numbers. And when they were actually said, and spread around the room, she refused to believe them, as well. I've never seen anything like it in my life.

SMITH: So what does the president's reaction to that? What does he's saying? After these two meetings today, where does the president stand?  We are about to enter days 13 of this shutdown, and I know that he is invited, leadership back to the White House for another meeting on Friday.

Will he be more willing to negotiate then? He's asking Democrats to give on their end. They do not want to pride funding for the -- provide funding for this border wall.

I just wonder what is President Trump willing to give up at this point to make a deal.

GIDLEY: You want to know where the president stands, he stands for the safety and the security of the American people. What the Democrats had on full display today was that they stand for hundreds of thousands of people who come here every year illegally and unlawfully as opposed to hundreds of millions of American citizens.

And here is how you know that, the bill that Nancy Pelosi is touting that she put forward actually funds foreign aid more than it does border security. She wants to give more of Americans money to foreign countries than she wants to give more of Americans money to foreign countries than she wants to spend on protection of our own citizens. That's to tell you all you need to know.


SMITH: Does Steny Hoyer -- Steny Hoyer just made it very clear. And by the way, a lot changes tomorrow with the new Congress convening and Nancy Pelosi will become the speaker. I just -- I just wonder what changes tomorrow it -- before that meeting at the White House on Friday. Is there going to be more room to negotiate? Or is the president sort of feel like he's been put in a corner here?

GIDLEY: Well, the consensus seems to be that Nancy Pelosi would be more able to negotiate once she secure her spot as Speaker of the House. So, that's going to be interesting how that plays out tomorrow. But the president is very clear because not only has he been repeated over and over again where he stands in his protection to American people. But now the Democrats are on record again. Standing with people who are here illegally.

That's a watershed moment for this country, and entire party refuses to address what they say they want, which is border security. But they don't want border security, they voted down every measure to support the American people.


SMITH: All right. So, what I was saying Steny Hoyer is they plan on bringing these six bills to the floor tomorrow that have already passed in some form on the House or in committee under Republican leadership. If any of this -- if anything makes its way to the President's desk, that doesn't have the funding for the border wall, will he -- will he veto anything?

GIDLEY: Well, look, that's a hypothetical. And I'm not going to get into those. But what I can tell you is the president has been clear what he wants on his desk is a bill that opens the government, that funds the government, and protects the American people. And right now, the Democrats are not serious about that. And you know they're not serious because serious people with serious plans and serious proposals don't negotiate in the press.

SMITH: Right.

GIDLEY: And that's all the Democrats have done to this point.

SMITH: I've got to get to Congressman McCarthy, but just final word, have you spoken with the president since both of these meetings ended yourself?

GIDLEY: Yes. I had. Absolutely.

SMITH: Could you tell us anything he said?

GIDLEY: I don't want to get into private conversations. But what I can tell you is he stands firm with the American people, it was a campaign promise. He's already had record-setting accomplishments and record- setting time, and he wants to come through on this one because the crisis of the border is not going away where we were years ago.

Democrats are now pushing forward with status quo money, and status quo legislation, and we are not in status quo. We're in full-on crisis mode.  The president knows that. And so do the American people. He's going to stand with them.

SMITH: All right. Hogan Gidley at the White House for us tonight. Thank you, Hogan.

GIDLEY: Thanks so much.

SMITH: Our next guest was inside the Situation Room for today's meeting.  Incoming House Minority Leader Kevin McCarthy. Congressman, thanks for being here tonight. You just heard that conversation. A lot of people are wondering, how can there be a cabinet meeting, a briefing in the Situation Room, eight leaders from both parties, from both chambers of commerce, and the president, and the White House just told us nothing changed today, how can that be?

MCCARTHY: Well, it's -- what was this talk do? And I thank the president for putting the meeting together because that's what has changed. The president -- remember, the vice president went to Senator Schumer whose Senator Schumer could determine whether government stayed open or was shut down more than 13 days ago. And he made an offer to them.

Schumer never got back to him, shut the government down because what your viewers have to remember is not a simple majority in the Senate. It takes 60 votes. So, it's the Democrats who decided about a shutdown.

The president stays here with the vice president, wants to work this out, Democrat leadership leaves. So, he brought everybody together. Inside the Situation Room, we were invited to go because we're going to have a briefing. That's what happens in Situation Rooms about the crisis that's happening at the border today.

The rise of those who are trying to come across the border. But more importantly, just within the last 48 hours, we had a violent mob kind of run across, try to get across the border as well.

So, we were having a briefing with the Secretary of Homeland. She couldn't get past the first sentence before she was interrupted by Schumer and Nancy Pelosi. And they pretty much stayed on script. Almost like they had written the script.

And they went through what they want to do these six appropriation bills move through. And then not do anything with Homeland Security. And you know what --


SMITH: So what does -- what do -- what should our takeaway be from that, congressman? I mean, is this about border security? Is this about -- is this about money? Is this about the change of leadership that's about to happen, and waiting until after that. What is this standoff really about?

MCCARTHY: It's real -- it's not about money because we all -- we have to appropriate within the dollar figure we've already said. So, we can fund this easily as you -- as you can see. The question is philosophically do you want to have open borders or would you want to have a border that you actually can control? And do you want to open the government?


MCCARTHY: So, what the president really was able to pick up on, and it came up across with some of the Democrats. It might be easier for them to have this discussion after the vote for speaker tomorrow.


SMITH: So, Nancy --

MCCARTHY: So, the President said, "Let's go back on Friday after the speaker vote and maybe you'll be in a different position. Could actually start negotiating, so we could get the government open and secure our border.

SMITH: So both Nancy Pelosi and Chuck Schumer emerged from that meeting, saying that Republicans refused or the president, in particular, refused to answer one question. Here is Nancy Pelosi today.


REP. NANCY PELOSI, D-CALIF., HOUSE MINORITY LEADER: We have given the Republicans a chance to take yes for an answer. We have taken their proposals unamended by anyhow bipartisan amendments. But, but just staying true to what the Senate has already done.

Our question to the president and to the Republicans is why don't you accept what you have already done to open up government and that enables us to have 30 days to negotiate for border security?


SMITH: Perhaps you can answer that question for us.

MCCARTHY: Oh, very, very clearly. For the last 13 days, the Democrats would offer nothing. Today, they offered nothing. There was only one side inside that room that was willing to compromise and come to an agreement.

It could -- the number of times I had to ask the Democrats. "OK, what is your offer then?" Or I couldn't even get them to define what's border security. They say they believe in border security. Then, I took it to the next level, OK, could you define what border security is for me?  Because they don't want to talk about having a wall.

That's an element of border security. When you look at San Diego, El Paso, Yuma, Arizona. These have all cut down and made the community safe by more than 95 percent after being able to put some border security wall, as well.  So, this is a real part --


SMITH: All right. I've got to --I've got to live it there, Congressman.  There is a big couple of days coming up. Just finally, how long is this shutdown last? Your expectations there?

MCCARTHY: Well, this could be solved very quickly. I'm hopeful after the speaker vote, they're in a different position that they're willing actually to negotiate, find a compromise, and bring this government back open. But also secure our border.

SMITH: Congressman Kevin McCarthy, great to have you on the program tonight after a busy day.

MCCARTHY: Thank you.

SMITH: We appreciate it. Thank you. Here now, Charlie Hurt, opinion editor for The Washington Times and a Fox News contributor. You've been listening to all this, Charlie. I think people see this they hear this, they're watching this, and they wonder how nothing's getting done and the government is still shut down, and we're entering now day 13 of this.

CHARLIE HURT, FOX NEWS CONTRIBUTOR: And I think that's exactly the gamble that the president is taking. He sees the situation it steps back, you know. It's hard to -- as you were finding yourself kind of frustrated trying to figure out where the movement was, what movement occurs, what's happening, how is nothing changing?

You know, when it's that confusing, it's probably smart to step back. And this is what I think President Trump is banking on. You step back and you look at the big picture. And he's looking at the big picture and he's saying, I'm standing up for border security. And you -- and I'm against people who are -- don't -- you know, they don't like my wall, and they don't like -- and there's are elements of that group of people who are in favor of abolishing ICE and sanctuary cities and things like that.

And he looks at that, he says, "I can win that fight." And you -- and you have that going on at the same time that he's having the debate about Syria, pulling out of Syria, and the quote that you had which is a very good one for him. Talking about spending more money in Afghanistan in a month.

And it would cost to build a wall that all of that is a mana to the people that voted for him.

SMITH: And I want to bring in Christopher Hahn, former senior aide to Senate -- Senator Chuck Schumer, and a syndicated radio host. Chris, great to have you, as well.


SMITH: So, if you could weigh in on the moment, I mean, because I -- usually, at this time of the night say so much has changed, it just doesn't seem that it has but there's a big couple of days coming up. What do you think?

HAHN: Look, I think the president decided to own this shutdown and he clearly owns it. The Democrats went to the White House today and looking to negotiate not to be lectured by Secretary Nielsen. He's done a terrible job.


SMITH: But they went there for a briefing and what you're hearing from Republicans is that -- is that, that Kirstjen Nielsen, that the Homeland Security Secretary was consistently interrupted by Democrats.

Seems to be a big issue that we're hearing came out of it loose that meeting, but go ahead.

HAHN: Well, you know, I think that the Democrats have a good understanding about what's going on at the border. I think they see it differently than the president. They see it differently than Kirstjen Nielsen. I think they want to get the government opened and continue negotiating about border security and not --


SMITH: How do Democrats see the situation at the border different than the Homeland Security secretary?

HAHN: Well, the Republican see this as a -- as a crisis that they could use to gin up their base because it's fake. And the Democrats see the reality that actual border crossings are down in the Trump years, and down since Obama.

So, I think the Democrats understand that yes -- we want to see secure -- we want to see secure our borders, but we don't want to see the government shutdown for it.


SMITH: We get -- Charlie start on that. Charlie like to respond to that?

HAHN: And we surely don't want a wall, which is not going to solve anybody.

HURT: Well, certainly, if Democrats believe that the crisis on the border is a fake crisis, you're going to lose that fight without a doubt. And let's also not forget that the President did make a very -- a very valid offer. It was -- it was far more than I think a lot of his supporters wanted when he agreed to a very generous DACA deal in exchange for border security and Democrats walked away from it. And they either walked away because they don't like border security or they walked away from it because they didn't want to give Trump a victory on DACA.

HAHN: See Charlie, that is --

HURT: Either one of those -- either one of those explanations is very bad for Democrats.

HAHN: That is -- that is -- that is not -- that is not the case. The Democrats were more than willing to give the President border security for DACA. It was a $25 billion deal. The President walked away from that deal. General Kelly called Senator Schumer to retract that deal when that deal happened a year ago.

SMITH: All right, final word to you, Charlie. We got to go.


HAHN: Look and one -- one more thing, Charlie --

SMITH: Charlie, go ahead. I'm running out time.

HURT: President Trump made that offer, the Democrats walked away from it and that's how that offer ended.

SMITH: All right, guys, well, we'll see what happens. Dems take control of the House tomorrow and another meeting will happen on Friday. And there we have it. Thanks to both of you. Well, up next the illegal Mexican immigrant accused of killing a California police officer appearing in court for the first time today. We will have an update on that next.


REGGIE SINGH, BROTHER OF SLAIN POLICE OFFICER: I was waiting for this to happen. I'd like to thank you for working day and night to make this happen.



SMITH: Tonight, the illegal immigrant accused of killing a police officer appearing on a California courtroom a short time ago, now facing murder charges in the death of Corporal Ronil Singh. Trace Gallagher was tracking the latest from our West Coast newsroom. Hey, Trace!

TRACE GALLAGHER, FOX NEWS CORRESPONDENT: Hey, Sandra! Today in court the suspect said his real name is Paulo Mendoza but until that can be verified, he is still being formally charged as Gustavo Perez-Arriaga. The 33-year- old gang member did not enter a plea because his lawyers arguing that Arriaga is not competent to stand trial.

Perez-Arriaga was captured on Friday in Bakersfield California after a 55- hour manhunt. Police say he was trying to flee back to Mexico. Arriaga is accused of shooting and killing Newman police officer Ron Singh the day after Christmas. Officer Singh had stopped Arriaga on suspicion of driving under the influence. The suspect had also been arrested for drunk driving in 2011 and 2014.

And in most states after those arrests, Immigrations and Customs Enforcement or ICE would have been notified of Arriaga illegal status, but under California's sanctuary laws, local police are prevented from cooperating with federal immigration agents. Several California sheriffs blame the law for Officer Singh's death and today President Trump weighed in. Watch.


TRUMP: Like the killing that took place a few days ago. The young police officer, great young beautiful person, great family, just took a picture with his son and his wife for Christmas and a few hours later he was shot and killed by somebody that just came across the border.


GALLAGHER: -- who were also in the U.S. illegally have now been either arrested or charged with helping Arriaga evade capture. But even though they allegedly tried to help a cop killer in California, the charges against them are not serious enough to allow sheriff's deputies to notify ICE if they're released from jail.

Neither current California Governor Jerry Brown or incoming governor Gavin Newsom have shown any interest in reviewing the state's sanctuary laws because they believe the laws make the state safer. Prosecutors have not yet decided if Arriaga will face the death penalty. Sandra?

SMITH: All right, Trace Gallagher, thank you. I got a Fox News Alert for you here. Senate Majority Leader Mitch McConnell is speaking right now on the Senate floor after that Situation Room meeting with congressional leaders at the White House. Let's listen if we can here.


SEN. MITCH MCCONNELL, R-KY., SENATE MAJORITY LEADER: All three of those things are needed to make a law. One partisan vote in the house tomorrow is not going to solve anything. I've made it clear to the Speaker we're not interested in having show votes here in the Senate. We're interested in bringing up something the House has passed, 60 senators will support, and the President will sign. In other words, make a law.

The legislation that House Democrats are reporting -- reportedly planning to introduce and be voted on tomorrow will not be a serious contribution to the negotiations that are going on between the administration and the incoming Democratic majority in the House. It isn't comprehensive, it ignores the needs of border security. It's exactly the kind of proposal you'd expect if the incoming House Democrats are choosing to stage a political sideshow rather than doing the hard work of helping to govern the country. In other words, a total non-starter.

So these new Democrats come to Washington ready to roll up their sleeves, work together, and make laws, or are they going to waste time on partisan show votes that will do nothing to move the country in a forward direction.  That's the question political performance, art, or responsible governance.  Well, we'll get an early signal in the next few days but let me make it perfectly clear one more time as I've said consistently for the last two weeks, the Senate will not waste its time considering a Democratic bill which cannot pass this chamber in which the president will not sign.

So another matter, I'm pleased to announce this evening that the Democratic leader and I have reached an agreement to confirm a number of the administration's nominees and a few moments --


SMITH: You've been listening to Senate Majority Leader Mitch McConnell on the Senate floor. It is almost 7:30 p.m. Eastern Time on the East Coast.  We are now looking at what will be a divided government. As of tomorrow morning, Nancy Pelosi and Democrats will take control of the House and they are still at a standoff or over the border security and the government shutdown so it continues tonight. We'll see where day 13 brings us.

Up next, President Trump fires back at incoming Senator Mitt Romney who is not officially on the job yet but is already taking swipes at the Commander-in-Chief. Bill Bennett calls Romney's actions self-serving.  He's up next to explain.



TRUMP: If he fought really hard against President Obama like he does against me, he would have won the election. Does that make sense to you?  If he fought the way he fights me, I'm telling you, he would have won the election.


SMITH: President Trump responding to a scathing opinion piece from Senator Mitt Romney who writes that the President "has not risen to the mantle of the office." Late today, Romney still not backing down talking to CNN to defend his criticism of the President.


SENATOR-ELECT MITT ROMNEY, R-UTAH: Well, you know, after he was elected president, it was my hope that he would rise to the occasion, rise to the mantle of the office. After all, becoming president of the United States is quite an elevation for anybody. And while that was my hope, I don't think he's followed through on that front the way he followed through on some of his are the promises.


SMITH: Bill Bennett hosts the Bill Bennett podcast, former Education Secretary under President Reagan and now a Fox News Contributor. Bill, good to see you tonight.


SMITH: So, what did you make first of the actual criticism that Mitt Romney heaped on the president?

BENNETT: I thought it was a shame, and it was a gratuitous and an ill-time unnecessary shame. And shame on Mitt Romney for doing it. I supported Mitt Romney in 2012. But his record now of returning good gestures by the president with this kind of ingratitude, and worse, obloquy, is really an embarrassment.

He will never be president. If he runs for president, he will never succeed. I don't understand. I don't understand the timing. The man is not even sworn in yet. Let's just recall the facts.

Mitt Romney sought the endorsement of Donald Trump. He chased him around to get it. He got that endorsement. Then in March 2016, Romney gave the speech about candidate Trump saying that he was a fraud. He was a phony and that his promises were worth nothing.

The president was elected and forgave him. Took him to dinner and invited him to the golf club. They talked possibly about a cabinet position. It didn't work out. And now Romney returns it with this.

By the way, when Romney was running for Senate in Utah just a few months ago, he didn't bring up these criticisms and the president endorsed him. So that's how he repays the kindness of the president. I wonder if Mitch McConnell when he said showboat or show horse is opposed to work horse was thinking of Mitt Romney.

SMITH: As we just from him on the Senate floor. Romney did just speak to another television network and he was asked about his 2020 ambitions and here's his answer.


SENATOR-ELECT MITT ROMNEY, R-UTAH: He was endorsing me. I wasn't endorsing him. And I haven't decided who I'm going to endorse in 2020. I'm going to wait and see what the alternatives are.

JAKE TAPPER, CNN HOST: So, you are not on board. Because the senior senator from Utah, Mike Lee said he is likely going to endorse the president.

ROMNEY: I think it's too early to make that decision. I want to see what the alternatives are.


SMITH: So that was just a short time ago. And there's also this from the GOP chairwoman Ronna McDaniel. She tweeted out about the president being attacked and obstructed by the mainstream media and Democrats 24/7. She writes. For an incoming Republican freshman senator to attack the president as their first act feeds into what the Democrats and media wants and is disappointing and unproductive. That was just from Ronna McDaniel, Bill.

BENNETT: Yes. And Ronna Romney McDaniel is the niece of Mitt Romney. When he was asked about that. He said well, she is head of the Republican Party. You expect that. What team are you on, Senator Romney? Didn't you run as a Republican?

You know, the president really has a point here. He said that if he ran as hard and pushed as hard against Barack Obama in the campaign as he is doing against Donald Trump, he might have won. And that's entirely true.

You know, has Mitt Romney played team sports? Does he understand anything about the situation that his colleague, his Republican colleague Donald Trump is in now? Challenges by the Democrats. Of course, the constant challenge of the media and the like.

By the way, you know, you said he didn't back down. He went on CNN. Now that's courageous to go on CNN to criticize the president. That takes a real man to do that.


BENNETT: You know, join the throng, join the choir. You know, and just exactly what is in his head? Does he understand we have a critical situation at the border? The president is being, you know, attacked on all fronts. This is the time for people to rally. Does the president do some things wrong, make mistakes? Yes.


BENNETT: So indeed, do you, Mr. Romney. You know, a lot of us looked past the minorities to support you.

SMITH: Rand Paul held a conference call with the press today and said attack the policies and don't attack the president on a personal level. Thank you very much, Bill Bennett. Great to see you tonight. Thank you.

BENNETT: Thank you, Sandra, as always.

SMITH: All right. Well, up next, the bizarre story of a former U.S. marine who traveled to Russia for a wedding and he is now is being held in the country over espionage allegations. What the Trump administration is doing now to intervene. Next.


SMITH: New details tonight about a Michigan man being held in Russia at this hour over spying allegations. We've now learned American citizen and U.S. Marine Corp veteran Paul Whelan has visited the country at least twice since 2007 while in the service. He also spent two weeks of military leave in Moscow and St. Petersburg.

And tonight, President Trump's U.S. ambassador to Russia is stepping in, paying Whelan a personal visit to a Russian prison.

Foreign affairs correspondent Benjamin Hall the story from London tonight.

BENJAMIN HALL, FOX NEWS CORRESPONDENT: Forty-eight-year-old Paul Whelan was in Moscow to attend a wedding when he suddenly disappeared last Friday. A former marine who served two tours in Iraq he was actually given a bad conduct discharge and had since been working in corporate security for a Michigan based auto parts supplier BorgWarner.

The Russian federal security service announced his arrest on their web site three days after he suddenly disappearing, saying only that he was caught during an espionage operation. Russian spying charges carry prison sentences of up to 20 years.

Earlier today we heard from Secretary of State Mike Pompeo who said they were still searching for more answers.


MIKE POMPEO, UNITED STATES SECRETARY OF STATE: We made clear to the Russians our expectations the detection is not appropriate and we demand his immediate return.


HALL: We've also learned that the Russian government has now granted U.S. consulate official access to Whelan. And Ambassador Huntsman, the U.S. ambassador to Russia has been to see him in the detention facility. He expresses his support and offered the embassy's assistance.

Whelan's arrest comes just weeks after Maria Butina, a Russian woman in the U.S. admitted being a Russian secret agent for the Kremlin trying to infiltrate U.S. political groups. And some say Whelan's arrest is a response to that.

U.S. and Russian relations have deteriorated greatly over recent years over Russian meddling in U.S. elections, Russian's actions in Ukraine, and the poisoning of a former Russian spy in the U.K. which led for tit-for-tat diplomatic expulsions for a 100 diplomats.

Just last week in his Christmas address, President Putin said that Russia would never arrest an innocent person just to exchange him for someone else. Experts now say that's exactly what happened. Sandra?

SMITH: Benjamin Hall in London, thank you. Here now Judith Miller, a Pulitzer Prize winner investigative reporter and Fox News contributor. Judith, good evening to you. What a story. As the U.S. now searches for answers.

JUDITH MILLER, AUTHOR & FOX NEWS CONTRIBUTOR: Yes, and even Secretary of State Mike Pompeo was very cautious today when he addressed this issue. He said that if the Russian charges were untrue, we would immediately demand his release. But he did not say that Paul Whelan was an innocent man.

However, everything points to a retribution, an action that was taken by the Russian government. And it had to be at a very senior level. In retribution for Maria Butina's acknowledgement that she in fact spying for Russian.

SMITH: From Ann Arbor, Michigan, his family said that these charges are baseless. His brother describes him as a very kind person, very generous with his time. They say he's funny gregarious sort of person. What happens next in all of this?

MILLER: Well, I think what happens depends largely on one, what we determine about whether or not Mr. Whelan was in fact working for an agency of some kind. It's unlikely that he was working for the CIA given his discharge the bad conduct discharge.

However, there are other intelligence agencies. So, first of all, the U.S. government will quickly determine whether or not he was on a contract of some kind for someone. But whether or not he was, there will immediately be negotiations began about his release.

And I think what Putin may be trying to do is to just signal to President Trump that if Donald Trump wants good relations with Russia, this kind of thing has to stop.

And that's unfortunate because Donald Trump is not wrong in seeking to work with the Russians where we can work the Russians -- with the Russians. But Vladimir Putin has been so aggressive in the area, so aggressive towards the Ukraine, et cetera, that it's very hard to work with him. If he approved such an arrest of an innocent man, that's a very serious issue.

SMITH: As you can imagine his family is deeply concerned with his safety. And we'll see what sort of answers they get in coming days.

MILLER: Absolutely.

SMITH: Judith, thank you.

MILLER: Thank you.

SMITH: Well, the U.S. army is revamping its recruiting strategy in the new year. We talk exclusively to the deputy commanding general of operations next.


SMITH: The United States Army is revamping its recruitment effort after falling thousands short of 2018 goals. The branch is reportedly turning to more than 22 liberal leaning cities to help fill the ranks.

The head of army recruiting command saying of the plan pushed, quote, "We want to go into Boston, Pittsburgh, Kansas City, these are places with a large number of youths who just don't know what the military is about."

Here now exclusively is the number two in charge of the army's recruiting all over the world. Brigadier General Kevin Vereen, deputy commanding general of operations for U.S. Army Recruiting Command. General, a pleasure and an honor to have you on this evening on this evening.

This is a fascinating story. One that not many of us are familiar with. What sort of, what sort of challenges do you face right now?

KEVIN VEREEN, DEPUTY COMMANDING GENERAL OF OPERATIONS, U.S. ARMY: Well, we are facing quite a few challenges. First of all, we understand that this is a big mission that the army has asked the recruiting command to do. And by golly, we are going to do it.

We do have some challenges with regards to how our youth are understanding the army and what the army has to offer. So, it's an awareness issue for one. There is a lot of youth that just don't know really know what is the army is all about.

And so, an awareness issue is one. I think the second thing we have is we have a challenge with finding quality in some cases. Most youth are they either have in some cases some medical challenges that may prevent them from joining the military as well as some other challenges, physical challenges that prevent them from joining the military.

But we do know that there is a quality market out there and we are going to do everything we can to tap into that quality market for those young 17 to 24-year-old young men and women that want to join the military.


SMITH: Well, we sure hope so.

VEREEN: I mean, the last things is --

SMITH: It's our future.


SMITH: Right. I'm sorry to interrupt you.

VEREEN: Yes, it is.

SMITH: But if you could, sir, just sort of, why these liberal leaning cities? Is it just, is it they have a larger number of youths? What plays into your strategy there?

VEREEN: Well, I think the first thing I want to say is that we recruit in every city across the United States and in some cases as you stated earlier, overseas as well. So, it's not necessarily a select 22 cities specifically. We are going into markets that we know.

Those 22, when you look at them, they are high propensity for quality applicants who really want to join the military and want to join the army. And so, we are going to go in those cities and we are going to have a higher presence of military.

If you looked demographically, we recruit very well in the south. And most of those cities are tied to military installations. But the 22 cities are areas where we know that we can do better. We can have a better presence and we can go after the quality that exists in those 22 cities.

SMITH: Well, we know that the military just got a pay raise. Will that help with recruitment?

VEREEN: Well, I think if you look at any raise will help folks understanding that we are keeping up with the pay increases and the pay raise across, you know, America. And I think it makes us comparable to other jobs and occupations that exist.

SMITH: General, when you go into these cities what's your pitch for those that you say might not know that much about the army?

VEREEN: First of all, they have to see people really that kind of looks like them. And that resonates with them. When they see our recruiters that are in uniform, to me, that's an awareness issue. And that's a point that allows them to understand that hey, look, I can be just like this person in uniform.

And then they get a chance to see the talent of our recruiters and our army. We do have some talented individuals that are recruiting. Some of who have degrees, whether it's a bachelor's or master's degree. And it really resonates with these young kids that hey, look, I'm wearing the uniform. I'm defending my country, I have an education and I'm doing extremely well and I can make a difference in my life and have a great career.

SMITH: Well, general, you are making a difference in all of our lives. So, thank you for your service, for your continued service and everything that you are doing for us.

VEREEN: Thank you very much.

SMITH: All right. General Vereen, thank you. Still ahead, the bromance as some call it between Kanye West and President Trump forges ahead into the new year. The rapper's latest rant on his love for the president and the he just promised about wearing a MAGA hat, next.


KANYE WEST, RAPPER: I'm standing in a spot (ph). I love this guy right here. Let me give this guy a hug right here. I love this guy right here.


WEST: Yes.

TRUMP: That's really nice.



TRUMP: Even Kanye West came out today and said great things about Trump. He's a good guy. But he said great things about us, because he sees what we are doing. He is smart and he sees what we are doing.


SMITH: President Trump responding to some praise from rapper Kanye West who appears to be reaffirming his support for the president months after distancing himself from politics.

Kanye tweeting on New Year's Day Trump all day adding "From now on I'm performing with my mother bleeping hat on," a reference to his make America great again hat.

Here is Kimberly Klacik, Republican strategist, and Richard Fowler, a Fox News contributor. Good evening to both of you. So, Kimberly, I will start with you first. The president responding to Kanye's words today seems to be embracing the support of Kanye West.

KIMBERLY KLACIK, REPUBLICAN STRATEGIST: Yes. I don't think they ever had a falling out. I think honestly Kanye West was trying to remove himself from a movement that he wasn't really a part of. Kanye West is unpredictable just like the president he is unpredictable. And they kind of move to the own beat of their drum. Right?

So, he was kind of getting mixed in there with another movement that's going on. And I don't think he is really a part of that. He supports Democrats. He supports those that are black Democrats. I think he just really wants to support the black community and I think that was getting lost before, so now he is reaffirming that he is a Trump supporter.

SMITH: What do you think, Richard?

RICHARD FOWLER, FOX NEWS CONTRIBUTOR: Well, here's the thing. I think he does support President Trump. Sadly, when it comes to the issues as you remember from the White House meeting a couple months ago, the president and Donald Trump seem to be completely unaligned.

Case in point is when Kanye talked about fixing the 13th amendment which says if you are in prison that you don't -- you lose your rights and Kanye says we need to get rid of that. I mean, I don't think the president has any plans of getting rid of that any time soon.

He also asked the president to pardon Larry Hoover, one of the most notorious gangsters in American history. And I don't see the president with his pardon pen out any time in the near future. So, once again, he might like the president when it comes to policy. Him and the president are 50 degrees apart.

KLACIK: I don't think that's true, Richard.

SMITH: Kimberly.

FOWLER: I mean, the facts are the facts. Look at the meeting.

KLACIK: You sound a little bitter there.

FOWLER: Not at all.

KLACIK: But I don't think that's true. OK. Well, I don't think that's true. I think President Trump is doing, you know, more than President Obama. I remember President Obama not even supporting school vouchers as his kids went to private school which would help the black community.

He is helping with black unemployment. He is helping with HBCUs, prison reform, the farm bill will eventually help the black community as well. He's got the urban revitalization coalition going on. I think Kanye West sees what he is doing and it's much more than what President Obama ever like attempted to do.

SMITH: Richard, how is he doing with the black community?

FOWLER: I think we can talk about --


KLACIK: How would Richard really know?

FOWLER: Well, I'm African-American.

KLACIK: Tell us, Richard.

SMITH: I'm not sure what that meant.

FOWLER: Neither am I. But let's talk about this. The president one thing that he touts us though, black unemployment rate. But yet still he is not dealing with the real issues facing the African-American community number one, being the alarming infant mortality rate or the number of black women who die at childbirth. These are real issues facing the black community. We heard nothing from this president about that.

SMITH: So, would you be willing, Richard, to give the president credit where he attempts to take credit for the lowering of the black unemployment level in this country?

FOWLER: I mean, I have. But to say that the president did it all on his own that's irresponsible. Remember, the economy when President Obama got it was in the hole. And what President Obama did was he stabilized it and President Trump is benefiting from that.

But, once again, this segment is about Kanye West and his policies and the president's policies are unaligned.

SMITH: All right. Kimberly?

KLACIK: Yes. So, I work in Baltimore City, I work in the community every single day. There are a lot of people that actually support President Trump that are just afraid to say it. And I think Kanye West is making sure people know it's OK to be a free-thinker. It's OK to support our president. When everybody supported President Obama that was fine. It's OK to support your president. This your country and that's who you should support.

SMITH: Well, perhaps we could come together on one note. Because Kim and Kanye now say they are pregnant with their fourth child today. Right?



SMITH: So, they are expecting another baby.

FOWLER: Congrats to them.


SMITH: But it's certainly a conversation that will continue and Kanye West is clearly showing that he wants to stay somehow in the political sphere and certainly he is doing that by supporting the president at this moment.

Thanks to both of you, Richard Fowler --


FOWLER: Good to see you, Sandra.

SMITH: -- and Kimberly Klacik, good to see you.

KLACIK: Thank you.

SMITH: Happy new year, everybody. Well, that is "The Story" on this Wednesday evening. Great to see you all here tonight. I will see you again bright and early tomorrow morning at 9 a.m. in "America's Newsroom" from hash tag nine to noon. Martha returns tomorrow night.


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