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Shoppers have a little extra cash in their pockets; driver could face more pain at the pump

Consumer prices dropped in December; oil prices are the rise, up more than 7 percent this week.

This is a rush transcript from "Your World," January 11, 2019. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

PRESIDENT DONALD TRUMP: That’s being invaded by criminals and drugs, and we’re going to stop it. So, I want the Democrats to come back to Washington and vote.

(END VIDEO CLIP)

NEIL CAVUTO, HOST: All right. So he’s still trying to avoid an emergency, and claiming an emergency to force the issue.

Welcome, everybody. I’m Neil Cavuto, and this is "Your World."

And where in the world do we stand right now? Hours away from breaking the longest record government shutdown, partial or otherwise, in American history.

Now, at issue here is whether the president gets his wall -- you’re familiar with that -- whether Democrats go along with that and whether they can cobble together some deal that would save face on both sides. That appears, at least imminently, unlikely.

To John Roberts at the White House on how this is playing out.

Hey, John.

JOHN ROBERTS, WHITE HOUSE CORRESPONDENT: Hey, good afternoon to you, Neil.

So, Congress is done for the weekend. They’re not going to be back until Monday, which guarantees that this will be the longest government shutdown in this country’s history, but the president still holding off on this idea of making an emergency declaration and then using money that has already been appropriated and is kind of salted all over the federal government to begin construction of his border barrier.

Here’s what he said at a roundtable with state, local and community leaders just a short time ago.

(BEGIN VIDEO CLIP)

TRUMP: This is too simple. It’s too basic. And Congress should do this. If they can’t do it, if at some point they just can’t do it, this is a 15- minute meeting. If they can’t do it, I will declare a national emergency.

I have the absolute right to do. It says as clear as you can.

(END VIDEO CLIP)

ROBERTS: President Trump said yesterday and he said again today that the Republican Party is unified on all of this, that he’s never seen the party so unified. And he’s actually said that before too on other issues.

But there’s beginning to be the earliest signs of some cracks in the Republican Party. Iowa Senator Chuck Grassley saying he doesn’t think that declaring a national emergency would be a good idea. It’s supposed to be Congress that has the power of controlling the purse and it should be left up to Congress whether or not a border barrier is built.

Senator Lindsey Graham, on the other hand, who met with the president earlier this afternoon, said: It’s clear that the Democrats don’t want to negotiate on this. Mr. President, declare the emergency now. Build the wall now.

But the president knows that if he were to make an emergency declaration and tried to start construction a wall, he would probably likely immediately end up in the courts. Listen here.

(BEGIN VIDEO CLIP)

TRUMP: I will be -- soon, it’ll be brought to the Ninth Circuit. And maybe even though the wording is unambiguous, just like with the travel ban, it’ll be appealed to the Ninth Circuit. And we will probably lose that too. And then hopefully we will win in the Supreme Court, but that’s what happens.

You can take the most perfectly worded document, as we have in this case, and they will always bring it to the Ninth Circuit. And then you never know what’s going to come out of the Ninth Circuit. And you never know what’s going to come out on appeal. But, fortunately, we have a Supreme Court that’s treated us very fairly.

(END VIDEO CLIP)

ROBERTS: I think, historically, it has been proven that the Ninth Circuit Court of Appeals never kind to the president. The Supreme Court on occasion has been.

Of course, today, as you mentioned at the top, Neil, this is the first day that federal workers have gone without a paycheck. The president very cognizant of that and said at that roundtable that he will sign the legislation making its way through Congress now to guarantee that each and every federal worker who has either been furloughed or hasn’t received a paycheck will get their back pay.

So there’s an acknowledgement here that there’s about to be a pressure cooker of pressure to reopen government that is soon about to explode here in Washington -- Neil.

CAVUTO: Yes, to put it mildly. John, thank you very, very much. Great reporting on this, my friend, John Roberts at the White House.

As John already outlined here, it is now looking virtually certain that this will break the record of 1995, when Bill Clinton and Newt Gingrich were going at it. That prompted a shutdown that ended up being 21 days. This could be significantly more days, some say even weeks, even months more than that.

Peter Doocy on Capitol Hill with the latest on that front.

Hey, Peter.

PETER DOOCY, CORRESPONDENT: Neil, Capitol Hill and Congress have cleared out. This is the basement of the Russell Senate Office Building. I see a couple of people, none of them elected representatives.

That’s because lawmakers went home without coming up with a plan to reopen the government, on the same day that hundreds of thousands of federal workers are missing their first paycheck and the 21st day that trash is piling up at places like national parks.

(BEGIN VIDEO CLIP)

REP. JARED HUFFMAN, D-CALIF.: We may soon have enough trash building up in our national parks to build a wall. Is that the idea, Mr. Trump? Is that the backup plan, to have our parks and park visitors and our professional park staff pay for the wall you said Mexico would pay for?

And, Mr. Speaker, the damage from the Trump shutdown does not end there.

(END VIDEO CLIP)

DOOCY: Lawmakers are looking to President Trump now to executive order the party out of the shutdown now, including one of the Republicans who had been brainstorming possible deals to make with Democrats, maybe even a trade, border wall money in exchange for letting DACA recipients stay.

It’s Lindsey Graham who wants a national emergency declared, because he says: "I just met with President Trump and his team. It’s clear to both of us that Democrats don’t want to make a deal and will never support border wall barriers on President Trump’s watch, even though they did so in the past."

But Republican Senator Chuck Grassley sees things differently. He says this: "I would advise against that," a national emergency," as a bad precedent, even if the president’s got the authority to do it. Even if the president’s got the authority to do it, I would advise against it. And I would think that each side ought to be laying something on the table to negotiate."

So even though there are some differences of opinion among Republicans here, President Trump said earlier today he thinks that Republicans are rock-solid trying to help -- Neil.

CAVUTO: All right, Peter, let’s find out if that is the case.

With us right now is South Carolina Senator Tim Scott on this issue of whether a national emergency would be warranted here to get this wall started.

What do you think, Senator? And welcome.

SEN. TIM SCOTT, R- S.C.: Well, thank you, Neil. Happy new year.

I think if -- there’s no doubt, if we have the emergency funding, if we take that route, you may end the shutdown, but you do not begin construction on the barrier.

Bottom line is that this goes straight to the courts, which is not good news for those of us who believe that border security is synonymous with national security. So, if we want to continue to move forward on getting the resources necessary to build the barriers, I think the emergency funding is not the next best option.

The best option is for the Democrats to do what they did in 2006 and what they did in 2013 and what they did in 2014 and what they did in 2017 is to offer opportunities for us to have the resources necessary to spend money securing our border, so we secure our nation.

CAVUTO: Now, even if that were the case -- and it looks like that would be a Herculean leap for them to do that.

SCOTT: Yes.

CAVUTO: But they might entertain it, we’re told, if it’s coupled with doing something on the DACA front, the children of illegals who got here and, through no fault of their own, are in this limbo.

Would you be open to that?

SCOTT: Certainly.

I think you have to be open to alternatives that are not currently on the table, as long as one of the alternatives doesn’t include taking money off the table for the barriers that are necessary on the wall at the border.

So if there is a conversation for us to have about having once again a multi-tranche conversation, one tranche being DACA, one tranche being perhaps visas or other immigration issues, and the final tranche being border security, I think we would all come back to the table ready to vote up or down if there is an agreement made, where the Democrats say, yes, we will support it, President Trump says, yes, he will support it.

I think you will find an open conversation and a willingness to move forward on some negotiation that gets us more than 41.3 billion. I think it has to be in the twos or the threes, two-plus billion dollars or three- plus billion dollars for the border security and the border barriers.

If that happens, count me in for being at that table.

CAVUTO: Do you think the president made a mistake, Senator, attaching this to funding the United States government, in other words, forcing a shutdown?

SCOTT: Well, I will be honest with you. I think the Democrats have made a mistake by allowing for folks who work for our country to go without a paycheck, when they could have come to the table yesterday. They can come to the table today to fund this government.

This is not that difficult.

(CROSSTALK)

CAVUTO: But he was the one, Senator, who attached this to that, right, that you either get this done, or I will shut this government down, and I will own it?

Since, he’s backed away from the owning it part, but what do you make of that?

SCOTT: Yes, I think you’re right, Neil, that he’s backed away from the owning part, because the Democrats absolutely have a major share in the ownership of this shutdown.

They could solve this problem very quickly. But let us be clear about what we’re talking about and we’re fighting for. We are not talking about Donald Trump’s wall. We’re not talking about President Trump’s priorities. We’re not talking about candidate Trump’s speeches on the campaign trail.

We’re talking about national security. We’re talking about the fact that just last year 6,000 gang members were stopped at the border. We’re talking about the fact that 1,950 miles of border -- and the Democrats in 2006 approved -- I think it was called the Secure Fence Act for 700 miles of additional barriers.

We have all heard President Obama’s comments in 2014 that said we must deal with the humanitarian issues at our border. This is a clear and ever- present challenge that someone has to face. And President Trump has said - - in the summer of 2018, President Trump said that this is going to be an issue.

This is not a new issue that was created in December. This was an issue foreshadowed in the summer of 2018.

CAVUTO: Senator, there is another hot issue to which you addressed, a very powerful, very eloquent op-ed, I believe in The Washington Post, where you talk about Iowa Republican Congressman Steve King’s remarks, which been readily being racist, in the eyes of many, including apparently yourself.

You go on to say that: "When people with opinions similar to King’s open their mouths, they damage not only the Republican Party, but the conservative brand, but also the nation as a whole."

So do you think he should resign?

SCOTT: I don’t think he should resign. His voters have elected him. I think he has without any question the power of his office.

I think what should happen, however, is he should take a step back from the damage he’s doing to the country and frankly to our party.

Instead of me talking to you today about the fact that the Republican Party has led to the lowest unemployment rate ever recorded for African-Americans in the history of this country, instead of us having a conversation about the opportunity zone legislation that will bring real relief to 31 million Americans living in distressed communities, instead of us having a conversation today about the fact that our -- my party has led to the strongest criminal justice reform that has -- will have a positive impact disproportionately on people of color, instead of having that conversation, I’m instead having a conversation about polarizing comments that conflate racism and conservatism.

And that is awful for our country and really bad for our party.

CAVUTO: Well, do you think Congressman King is a racist?

SCOTT: I don’t know him well enough to know what the intentions of his heart really are, to be honest with you.

But I can tell you that his comments are polarizing, at least. And, frankly, I find them offensive. But, in the end...

(CROSSTALK)

CAVUTO: But when he says things like white nationalist, white supremacist, Western civilizations, how did that language become offensive, and he’s obviously of the opinion it’s not, that sounds pretty racist, doesn’t it?

SCOTT: Well, there’s no doubt that it’s polarizing and insensitive.

But the fact of the matter is, I appreciate the fact that we live in a Western civilization that has led to the redefinition of poverty because of the free market tools that we have deployed on poverty in this country.

The fact of the matter is that there’s a lot to celebrate about the success that we have achieved as a nation. The American ideal has transformed poverty globally. And what I want to do is spend more of my time and more of my effort focusing on those folks who are challenged living on the fringes and why the Republican Party is the right way.

CAVUTO: So, you think, whatever you think of that, that his comments then would get in the way of that.

The reason why I mention it, Senator, is that Florida...

SCOTT: Well, they’re in the way of that.

CAVUTO: Former Florida Governor Jeb Bush had said on Twitter -- and I quote here -- "Republican leaders must actively support a worthy primary opponent to defeat King, because he won’t have the decency to resign."

Now, all party leaders and those in power have been very critical of his remarks, from Kevin McCarthy to House Minority Leader Liz Cheney, the Republican Conference chair.

SCOTT: Yes.

CAVUTO: But no one has recommended any disciplinary action, forget about resigning, any sort of action.

SCOTT: Well, I mean, I will tell you, I don’t know how we play that out.

I mean, frankly, people have the right to say what they want to say. But we have the right to respond to what they say. His voters elected him. And I have to respect them the fact that the voters saw something beyond his comments that was worthy of public service. And I imagine that they did.

CAVUTO: Well, you were forceful enough in your comments, Senator, to say enough of it, that this is hurting us...

SCOTT: Absolutely.

CAVUTO: ... and our brand and our party. So, I guess what I’m asking, if nothing is done, and he’s not apologizing for those remarks, and the party, just beyond criticizing him, leaves it at that, is this going to hurt your party?

SCOTT: Well, I think it hurts our nation more than I’m -- I’m more concerned with my country than I am my party.

At the end of the day, my goal is to have a vision for the future of this country. And one of the things I talked about in a speech that I gave recently was, what should America look like in 2030? I’m talking about the philosophical disposition that undergirds great success.

As long as I’m having a conversation about philosophy, we can move this nation forward together.

When I have to hit the pause button to have a conversation about race and racism and polarizing comments by other folks in my party, it makes it far more difficult for us to sell the conservative brand throughout this country and around the world.

And that is not good for the nation.

CAVUTO: All right.

Senator, I threw a lot at you there, a lot of questions, a lot of news items, but thank you for taking the time. I appreciate it.

SCOTT: Well, thank you, Neil. Have a great day.

CAVUTO: You too.

We will have more after this.

(COMMERCIAL BREAK)

CAVUTO: All right, we’re shut down, and what stocks do? Shoot up.

Since the shutdown started, we’re up almost 7 percent on the Dow Jones industrials. What does that tell us? Either the markets aren’t worried, they think it’s resolved, or they’re focused on other things.

Let’s ask market watcher Kathryn Rooney Vera. We have also got FOX Business Network’s Charlie Gasparino.

Kathryn, what is going on? How do you explain that?

KATHRYN ROONEY VERA, BULLTICK CAPITAL MARKETS HOLDINGS: The market doesn’t and shouldn’t care about the government shutdown.

This is something that we have seen repeatedly happen in the past. And not only that, Neil, 75 percent of the government is already funded. The remaining 25 -- and we have five appropriations out of out of 12 that have already been passed.

So when you look at how much of government spending, how much of federal government spending is mandatory vs. discretionary, the vast majority is mandatory. We’re talking Medicare, Medicaid, Social Security, interest payments on treasuries.

There’s only 25 percent that’s discretionary. So we’re talking about 8 percent of the total federal budget. This is very small. I don’t think this is a big deal for the markets. And you can see that in market pricing.

CAVUTO: Well, that does appear to be the case. I know they’re focused on what’s happening or promising on the front -- on the trade front, Charlie Gasparino.

But I would imagine, if this drags on much longer, and it has the tentacle- like effect of delaying certain IPOs and what the Securities and Exchange can do and what the FDA can do, then it’s a different story.

But what do you think?

CHARLIE GASPARINO, CORRESPONDENT: Well, how big is the federal budget? And take 8 percent of the federal budget. That’s a huge number.

And let’s be real clear here. The federal government inside the Trump administration is contradicting -- the numbers inside there is contradicting exactly what your last guest said. They believe that, next week, the impact of the shutdown will appear in jobs and economic output.

There’s no doubt about that.

CAVUTO: Yes, but isn’t that like a hurricane, though, Charlie, not -- I don’t want to minimize it. But what you lose, you gain back with reappropriated pay, that it washes out.

GASPARINO: Maybe.

ROONEY VERA: Absolutely.

GASPARINO: Yes, but maybe it washes out, but you get hit with it.

And there’s -- this is -- some of this is a game. Listen, you can play the long game all you want. That’s not politics. Politics is immediate.

And there’s going to be -- and there’s going to be an economic impact here. And those numbers are going to get regurgitated. And I think that’s why...

(CROSSTALK)

CAVUTO: All right, that’s a good point.

But, Kathryn, let me ask you about that.

ROONEY VERA: Yes.

CAVUTO: I mean, Moody’s had put out a survey saying that it’s going to slice a little bit off GDP for this quarter.

Let me ask you that same issue about how long it drags on. Then what?

ROONEY VERA: Well, let’s face it. I mean, it’s not going to drag on if the president declares a national state of emergency and funds the wall via that method.

GASPARINO: That’s why he’s going to do it.

ROONEY VERA: I think the markets will actually go higher when he does that, because it’s squashes the uncertainty, which the market doesn’t even care about deal, with regard to -- with regard to the shutdown.

GASPARINO: But, Neil...

ROONEY VERA: So, when the president decides to go the emergency route, which he will, which I agree with Charlie he will, then the issue of government shutdown is ended.

And, remember, essential workers are working. And the furloughed guys get retroactive pay. So really, this is not a big deal -- $950 billion of $1.2 trillion is already funded. We’re not going to get certain data.

(CROSSTALK)

CAVUTO: It is a big deal.

GASPARINO: It is a big deal.

CAVUTO: That, I understand.

But, Charlie -- Charlie, let me switch this around a little bit. If the markets are not so concentrated on this, and if they’re feeling this is not going to have a huge economic impact, the other twist is, though, that it could call into question anything getting done these next two years.

If this is a sign of things to come, not a lot will happen. Now, maybe that’s a good thing. Maybe it’s a bad thing. What do you think?

GASPARINO: Well, it depends.

It could be a good thing. Listen, gridlock in Washington is often good. The real problem the markets have, I think, with this whole thing is, it shows dysfunction. It shows we’re going into a potential trade war, we’re going into a potential global slowdown, and those are big issues.

Now, I will say one thing, Neil. The reason why Trump is looking to do the emergency order is because he knows the numbers that I’m talking about. They’re bigger than what she’s telling you. I’m telling you that.

CAVUTO: No, they are what they are.

(CROSSTALK)

CAVUTO: But we will see.

All right, guys, I want to thank you very, very much.

ROONEY VERA: Those are the numbers. Those are the numbers.

(CROSSTALK)

CAVUTO: All right, I love that fight, no, you -- no, better than you do.

Anyway, say it ain’t, Joe. Freshman Democratic Congressman Alexandria Ocasio-Cortez slamming former V.P. nominee Joe Lieberman over something he said on my FOX Business Network show.

You don’t get FOX Business, well, you missed a lot.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

JOSEPH LIEBERMAN, D-CONN., FORMER SENATOR: A 70 percent tax on high income- people is really done for political reasons.

(CROSSTALK)

CAVUTO: But is this congresswoman the future of the party, in your view?

LIEBERMAN: No.

I -- with all respect, I certainly hope she’s not the future. And I don’t believe she is. And I tell you what. She’s gotten a lot of attention because she’s different, she’s controversial.

(END VIDEO CLIP)

CAVUTO: All right, that was former Democratic vice presidential nominee Joseph Lieberman starting a bit of a feud, it would seem, with the New York Democratic sensation Alexandria Ocasio-Cortez over the future of the public.

The congresswoman responding in a tweet after apparently watching this: "New party, who dis?"

No idea what that means, but I do know that she didn’t take kindly to his comments that she wasn’t representative of the party’s future or interests.

Axios reporter Stef Kight, Trump 2020 Campaign Advisory Board member Madison Gesiotto, and we have got former Democratic Congressman from North Carolina Brad Miller.

Congressman, I end it begin with, don’t mind, begin with you.

What Joe Lieberman seem to be saying was, she is not indicative of the party and its thinking, let’s say, with stuff like a top tax rate of 70 percent, et cetera. Do you agree with that?

BRAD MILLER, D-N.C., FORMER CONGRESSMAN: I think there are a lot of folks in the Democratic Party.

And it’s time that we have a debate about what we want the country to be like. We have suppressed debate for too long within the Democratic Party. I think enforced orthodoxy has not worked well for us. It didn’t work in 2016, so let’s have a wide-open debate.

CAVUTO: All right, does she represent more your views, you think, mainstream Democratic views, or someone like a Joe Lieberman?

MILLER: Joe Lieberman, I think I speak for almost all Democrats in saying that I care more about what the fourth person in the third checkout line at Wal-Mart says or thinks than I do about Joe Lieberman.

His brand has always been the Democrat who trashes other Democrats. And that’s been old for a long time. And he no longer has credibility with anybody in the Democratic Party.

With respect to Alexandria Ocasio-Cortez, she’s saying interesting things. That doesn’t mean that I agree with all of them. But they’re things that have not been debated in a long time. They probably should be debated.

CAVUTO: Fair enough.

Madison, what do you think? What do you think the fallout is from this? Many look at her as the future of the party. What do you think?

MADISON GESIOTTO, CONSERVATIVE COMMENTATOR: Her tweet was funny, and she may be young, but her ideas are old, as far as I’m concerned.

We have seen them brought up over the years in different ways, shapes and forms, but at the end of the day, they haven’t been implemented because they simply won’t work. They wouldn’t have worked 20 years ago. They won’t work today. We can’t afford them.

We look at things like Medicare for all proposed by people like her and Bernie Sanders, $32 trillion over 10 years, even with drastic, radical tax hikes that they’re talking about, we won’t even be able to pay for half of that.

So the ideas aren’t going to work. And I think Lieberman really did have a good point there. I mean, for the sake of the Democratic Party, you can’t imagine that you would want people to go as far left as her when you’re looking at a lot of these purple states and districts that they have been able to win. They’re not going to be able to keep those.

(CROSSTALK)

CAVUTO: But, still, Madison, it is a little rich for Republicans to bemoan deficit spending or not being able to pay for something. Both parties have abused this privilege, but I think it’s a little...

GESIOTTO: Well, no, of course they have, but it’s the time where we need to step forward and hold both Republicans and Democrats accountable for that.

CAVUTO: Fair enough.

GESIOTTO: And make sure that this doesn’t go any longer, because we can’t afford it.

CAVUTO: Well, good luck with that. Let me know how that turns out.

All right, Stef Kight, let me ask you this. It is very, very clear to me that the one thing you can say about the congresswoman -- and I think Republicans risk losing sight of this -- is, she’s got a very passionate following. She’s a very popular, heartfelt representative of her cause.

And I think when they get into the issue of the 70 percent tax rate, they lose sight of the fact that she could be a very big draw to disengage young people and others who feel that both parties have failed them, in other words, a young Bernie Sanders. What do you make of that?

STEF KIGHT, AXIOS: Absolutely.

I think that is something that can be said for Alexandria Ocasio-Cortez. She has created this huge following, what, around 2.2 million Twitter followers. She has made headlines. She is a freshman congresswoman, and already there are these grassroots efforts to try to give her a spot on a committee, which would have been unheard of for any other freshmen congresswoman.

So I think the Democratic Party does see that. And I think that’s part of where their concerns come in. They don’t necessarily agree with her. They see her as young and maybe not understanding what it means to be in Congress and working with other Democrats.

But they do see that she does have a following. And, as you said, this could be huge when it comes to the future of the Democratic Party. There are -- there are so many voters, young voters who lean Democratic but, don’t always turn out to vote when it comes to the elections.

And she could be a tool that the Democratic Party can use. But, of course, they’re going to need her cooperation at the same time.

CAVUTO: All right, we will watch very, very closely.

Guys, I do appreciate the time you took here.

In the meantime, the president is apparently getting closer and closer to declaring a national emergency to build that wall. Historically, it gets to be dicey. We will prove it with a historian.

(COMMERCIAL BREAK)

CAVUTO: It could be the most expensive divorce in human history. The world’s richest man and his wife, well, now the two richest people on the planet, separate, but equal?

After this.

(COMMERCIAL BREAK) CAVUTO: All right, the president has said, even though he didn’t hint that he would tip his hand today, to declare a national emergency in order to build that wall. Some saying that’s abusing executive power. Others arguing that could incite measures in Congress to cut back on that executive power.

The UVA Center for Politics, all-around genius, bestselling author Larry Sabato with us right now.

Larry, the president held off, but a lot of folks in Congress are saying on both sides of the aisle this is a slippery slope. Where do you think this is going?

LARRY SABATO, DIRECTOR, UNIVERSITY OF VIRGINIA CENTER FOR POLITICS: I will be surprised if it doesn’t happen, simply because there’s so little chance of any kind of agreement coming out from Congress and the president on the government shutdown.

This really may be the only way out. That doesn’t mean it’s a good way, and it’s going to have some negative consequences in the future because of the precedent that it sets.

CAVUTO: So there’s also the political convenience, right? I mean, if you can declare an emergency, and get the government reopen, the first judge or circuit court slaps it down and another -- it’s appealed to another court, who knows, goes all the way the Supreme Court.

But at least the president can go back to his base and say, well, I fought the good fight.

SABATO: Sure.

And no one can predict the courts. We all know that. You think they’re going to go one way, and they go the other. And it’s very complicated, as you suggest, from level to level, from court the court.

But , yes, in the end, the president could say, can you believe that? They overturned this perfectly reasonable decision I made that solved the problem, and now we have to go back to square one.

Well, there are worse ways to end a crisis, Neil.

CAVUTO: Yes, I hear you.

But let me ask you something, Larry. You’re a great expert on this stuff. I mean, this whole government shutdown thing, I remember certainly cases in the Reagan years they were very short-lived events, but they really picked up steam with Bill Clinton, of course, in ‘95 and a number since.

This one’s going to break the record. But when did this get to be such a standard deal? When I talk to so many people who say, oh, the government shut down again, whatever, and I’m always surprised at that reaction, but I can understand it. But, in the old days, did they do this sort of stuff?

SABATO: No, in the old days, we were all more competent, Neil. And we weren’t as divided. We weren’t as divided.

(LAUGHTER)

CAVUTO: Yes.

SABATO: We weren’t as polarized.

This is another byproduct of the extreme political polarization in the country. So we can’t get together on anything. As has often been said, if you get a group of people at a table, average people from off the street, they could probably reach a compromise in about an hour, and the government would have been reopened a long time ago.

But this is a product of political polarization and the very polarized institutions of Congress and the presidency. And this really became normalized to a certain degree in the 1990s. It’s really been 20 years, 25 years of this kind of shutdown becoming ho-hum.

And it shouldn’t be ho-hum, because it really is a symbol in the United States and around the globe that we’re not a functional democracy anymore. We’re not a functional government anymore. That’s not the kind of signal you want to send, usually.

CAVUTO: Well, I look at some of the governments and what’s going on abroad, and France is going to have another weekend of protests, and Germany is in total disarray, the parties are screaming at each other, they might have to force an election, England, I don’t know where it’s -- it is in or out of Europe.

So, by comparison, we almost look Churchillian here, but what do you think?

(LAUGHTER)

SABATO: Oh, I wouldn’t go that far.

CAVUTO: That was a little extreme.

(CROSSTALK)

SABATO: That’s the first time I -- yes, that was extreme, Neil, really.

CAVUTO: Yes, I know. I know.

SABATO: I mean, you’re pointing -- you’re pointing to chaos abroad to justify chaos at home.

And I would like the United States is better than that.

(CROSSTALK)

CAVUTO: Guilty as charged.

But can’t they outlaw these things, where you leverage the government off this? Because no less than Marco Rubio, who supports the president on this border issue, said, be careful what you wish for, because the next, let’s say, a Democratic president comes in, he feels passionately, or she, about climate change, might force a similar issue, shut the government down again.

There’s got to be better ways to do this.

SABATO: Of course there is.

And Senator Rubio, by the way, made an excellent point. We never think about the precedent being set for the future. Republicans -- or, mainly, I think, Trump backers -- some Republicans have doubts about this.

But Trump backers generally love this idea, for lots of different reasons. But they need to think about what’s going to happen when there’s the next Democratic president -- and, yes, there will be one at some point in time in the future -- who decides to that the national emergency is climate change and ends up transferring billions and billions, tens of billions, hundreds of billions, to the fight against climate change.

Well, the precedent cited will be what Trump does on the border wall. So you get into the soup, and the temperature can be turned up by somebody in the future.

CAVUTO: All right, thank you very much. I thought you were going to regale with me stories when you were covering President Lincoln and his avoiding...

(CROSSTALK)

SABATO: No. I started with Teddy Roosevelt, and you know that. You know that, Neil.

(LAUGHTER)

CAVUTO: All right. Happy new year, my friend. Always good seeing you. Thank you very, very much.

SABATO: Thank you. Thanks so much, Neil.

CAVUTO: All right, we are paying attention right now to Nancy Pelosi. She’s speaking not on this issue, per se. But, again, it is not looking like they’re going to resolve this, certainly by the end of tonight, when technically we will have the longest government shutdown, partial or otherwise, in American history.

More after this.

(COMMERCIAL BREAK)

CAVUTO: All right, the president so far saying he’s not going to announce an emergency, a national emergency, to force the issue on this border wall.

Many who support his effort, by the way, to do so are saying, when it comes to declaring an emergency, be careful what you wish.

I wanted to bounce this off my friend and a real hero in American history, the former USS Cole commander, Kirk Lippold.

And, Commander, thanks for taking the time. And I do want to address some other issues, but first on this national emergency thing, the president is using that as a potential way to avoid this impasse and get the thing built.

Now, some of your military colleagues have said that, as much as they support what he wants to do at the border, that declaring such an emergency, channeling funds from other military purposes to this, that’s risky. What do you say?

KIRK LIPPOLD, FORMER COMMANDER, USS COLE: Well, I don’t think it is risky.

When you look at the size of the Department of Defense budget, quite frankly, Neil, you have a lot of money that’s been both authorized and appropriated. I’m not trying to sound too wonkish here.

But the reality of it is, a lot of that money over years doesn’t get spent within the Department of Defense. A lot of the money that the Trump administration is looking at using is coming from the Army Corps of Engineers, where it has not actually been obligated, doled out, contractors done and things built.

So consequently, money sits on the books for literally years at a time, and going back and finding a lot of those funds that have not been spent, compiling together, you could actually pay for a vast majority of this wall.

A lot of people don’t want to do that, because they feel, well, that might impact work in my district. A lot of these projects are already done, completed. It’s excess money that’s out there. This is one of the issues that got brought up in the Department of Defense audit that they recently failed.

CAVUTO: The reason why I mention it is -- and I know you were very happy to hear the news that Jamal Ahmad Mohammad Al Badawi, the man being the bombing of the USS Cole that many, of course, said was the trigger event a year before the 9/11 attacks -- you know that firsthand and very well -- that this type of funding would distract from getting these kind of bad guys.

What do you say to that?

LIPPOLD: I don’t think that’s an accurate statement.

I think, quite frankly, there are ways within the Department of Defense to find money that has not been obligated yet that has been sitting out there on the books for years that we can pull, bring up, get Congress to give us another authorization or to be able to reappropriate that money so that we can spend it for things like the wall, where there is a pressing national security issue down there, so that we can more effectively keep this nation safe.

It is not going to detract from things like precision strikes taking out terrorists like Al Badawi.

CAVUTO: All right, now, the troop movement out of Syria apparently will -- is beginning. How do you feel about that?

LIPPOLD: I think that the president has taken a good hard look at this. He has reviewed what the impact is going to be. There are pluses and minuses.

You will remember he needs to start drawing down. One of his campaign promises was, let’s get these troops back home. So, in doing that, well, there’s pluses and minuses in doing that. Keeping some troops on the ground, special operations and otherwise, in order to make sure that that drawdown goes well is an absolute must.

Turning some of these operations over to the Turks and providing them with logistical support and intelligence support to be able to go after the last remnants of ISIS absolutely necessary.

We shouldn’t completely disengage there, though, until ISIS is destroyed as a combat-effective force. They may be out there as an ideology, but that we can deal with over time. What we don’t want to do is two years from now have to reinsert bodies back onto the ground in order to combat ISIS, who has grown again, or metastasized, like it did during the Obama administration.

CAVUTO: Commander, I always enjoy our chats. I always learn a lot. Thank you, sir, very much.

LIPPOLD: Thank you, Neil. Same.

CAVUTO: All right, they’re calling it the divorce heard round the world. And, right now, it might be the divorce heard around bankers and shareholders connected in any way, directly or indirectly, to Amazon.

A marriage that falls apart and maybe has some enormous financial implications, beyond this couple.

(COMMERCIAL BREAK)

CAVUTO: All right, you don’t want to interpret too much in a stock that swings wildly, because it’s so pricey, but Amazon stock has been down two straight days.

A lot of questions arise about the potential impact on Jeff Bezos’ company, if Jeff Bezos is in the middle of a divorce, and he comes from an equal property state, when they separate, the husband and wife, just split down the middle everything they had.

This particular couple would have to split down about a $140 billion empire.

Attorney, among other things, divorce attorney, Janell Weinstein, joins us, Deke Digital chairman Dave Maney.

So we got you covered on the marital front. We got you covered on the market front.

Janell, what does that mean? In a state like this, where there was no prenup and all, in Washington state, when couples break up, it’s understood they just share everything down the middle. Is that the gist of it?

JANELL WEINSTEIN, ATTORNEY: Well, that’s the gist of it.

WEINSTEIN: Yes, that’s the gist of it, what they have acquired during the marriage that they divide equally.

What’s interesting here, though, is that this is the founder of Amazon. And many divorces with CEOs have already acquired a substantial amount of wealth prior to getting the divorce, during their marriage.

And here he has acquired the majority of -- his marital assets are the shares of Amazon, which makes it really unprecedented, what we haven’t seen before, and the number is so huge.

CAVUTO: Yes. And she was there almost at the beginning. It’s 25-plus years. I don’t know how long before that they were a couple.

But she can arguably claim, regardless of the rules of the state, what would be a big chunk of that. Whether it’s half, I don’t know.

But let’s assume that it is half, Dave. He would have to start selling some shares to make good on that. I don’t know the particulars of divorce law like Janell, but I do wonder what the impact would then be for the stock, for the company.

What do you think?

DAVE MANEY, FOUNDER, DEKE DIGITAL: Look, I almost think -- it appears to me that he can simply give her the shares, right?

They are probably held jointly. And so they can just split them 50/50. That’s Janell’s expertise, not mine.

I will tell you what I would be worried about. I would be worried about just the kind of the massive emotional toll and distraction that any divorce, let alone a really, incredibly, sitting in the public crucible, divorce like this one would take in terms of just distraction and roller- coaster ride.

That would make me genuinely afraid as a shareholder.

CAVUTO: He owns 16 percent of the stock right now. So it’s not as if he has majority control. I don’t know whether they have a special class of voting shares.

But, Janell, I would be curious, from your vantage point, anecdotally, I mean, at least on the surface, a lot of the comments post the announcement have been very amicable. I haven’t heard much out of her, but I have seen from him that they depart as good friends, and their four children, and et cetera, et cetera. All good is on that front.

But that can quickly change, right?

WEINSTEIN: Well, you know, Neil, the reality of this is, this has probably been discussed in detail prior to this becoming public.

CAVUTO: Right.

WEINSTEIN: I would venture to guess that there may be a lot of settlement discussions, if not even a possible settlement, before we’re even hearing of every -- anything.

CAVUTO: And, by the way, this came public in the first place because of a newspaper investigation into an alleged affair and all that. So I don’t even want to get into the nitty-gritty here, but it is possible they have sorted out these details already then, right?

WEINSTEIN: Well, yes.

Behind many divorces, there’s not really a good marriage, right? So there’s been discourse throughout. There’s a lot of different ways that they could settle this and do some creative settlements, where they can try to have Bezos remain the controlling shareholder.

Look, it would benefit both parties for that to happen. It may not that they sell off stock. Maybe Amazon can restructure or come up with a new structure, where he can retain the voting power.

Now, that’s beyond my pay grade.

CAVUTO: Well, yes, we will see.

But, Dave, on that front, you had the actually more emotional take on that -- and not bad for a market guy -- that this could be a very big personal distraction for him, to put it mildly, right?

MANEY: Yes.

And, by the way, I think there’s the -- there’s the financial settlement, which clearly neither of them are going to be hurting for money. But then there’s that -- they have four kids.

And as somebody who lived through a divorce while running a business and found it wasn’t at all good for business.

CAVUTO: Yes, I hear you. OK.

MANEY: And then you multiply it by the fact that they are taking on -- they’re competing with the most cutthroat businesses in the country, it is a -- it is a high-wire time for Amazon.

CAVUTO: No, you’re both right on both counts here. We will see what happens.

Guys, thanks very much for taking the time here.

We will have a lot more after this, including some big things that are coming up tomorrow.

(COMMERCIAL BREAK)

CAVUTO: All right, I don’t know how they quantify all this stuff, but a partial government shutdown already entering its record 21st day, it’s cost the U.S. economy about $3.6 billion.

That could rise. So, where are Americans feeling the impact of this?

Let’s go to FOX Business Network’s Edward Lawrence with that.

Hey, Edward.

EDWARD LAWRENCE, CORRESPONDENT: Hey, Neil.

Yes, first lawsuit -- the first lawsuit has been filed by the air traffic controllers union. Under the lawsuit, it says, under the Fifth Amendment, the president is "depriving them of their hard-earned compensation without the requisite due process."

Now, starting Monday, the U.S. Trade Representative’s Office runs out of money. It will not affect the Chinese negotiations, however. China has already been notified, according to U.S. trade officials, that the negotiators will continue to work even without pay towards a deal.

This will affect other departments, the FDA, for instance. FDA says they have stopped inspections of -- routine inspections of food processing plants in the domestic, in the United States. Foreign food processing will still continue.

The Treasury Department also out of money. Mortgages starting to back up, because that income verification statement is not there. Republicans say it’s not their fault.

(BEGIN VIDEO CLIP)

REP. STEVE SCALISE (R-LA), LOUISIANA: We could have everything open today, but the speaker is the one who’s being held hostage by the far left elements of your party, because she’s yet to agree to anything.

(END VIDEO CLIP)

LAWRENCE: And both sides dug in -- Neil.

CAVUTO: All right, thank you very much, my friend, Edward Lawrence.

All right, by tomorrow, it will be official. It will be the longest government shutdown we have ever experienced, partial or otherwise. We’re live tomorrow, remember, 10:00 a.m. Eastern time, "Cavuto Live," with Senator Bill Cassidy, Democratic Congressman John Garamendi, many others on this gridlock and where it’s going, also Doris Kearns Goodwin on the impact this has historically.

And what if Abraham Lincoln had to contend with such issues, a nation falling apart, and a government potentially shutting down at the same time? Been there, done that.

Exploring it this weekend.

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