This is a rush transcript from "Special Report," June 12, 2019. This copy may not be in its final form and may be updated.

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DONALD TRUMP, PRESIDENT: We have great internal polling. There were fake polls that were released by somebody that is -- it's ridiculous. No, we are winning in every single state that we poll. Those are fake numbers.

But you know when you're going to see that? You're going to see that on Election Day. I was getting these terrible poll numbers and I didn't see it, because I'd have tremendous crowds, and my opponent would have almost nobody. We do very little pulling because I'm not a huge believer in polling. I think you go out there and you fight and you don't really need the polls. You need ideas more than polls. But we have some internal polling, very little.

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BRET BAIER, HOST: The president talking about polls, asked about polls in part because there are a number of head-to-head matchups that have come out recently. Quinnipiac out with a 2020 generally matchup, and there you see as it stands in this Q poll, Biden, Sanders, Harris, Warren, all of them ahead of President Trump. "New York Times" had an article about the president's own polling operation. "After being briefed on a devastating 17-state poll conducted by his campaign pollster, Tony Fabrizio, Mr. Trump told aides to deny that his internal polling showed him trailing Mr. Biden in many of the states he needs to win, even though he is trailing in public polls from key states like Texas, Michigan, and Pennsylvania. And when top-line details of the polling leaked, including numbers showing the president lagging in the cluster of critical rustbelt states, Mr. Trump instructed aides to say publicly that other data showed him doing well."

However, it is worth showing out historically, the year before an election, just take a look back, 1983, Ronald Reagan trailing Walter Mondale significantly, George H. W. Bush, beating the Democratic candidate yet to be named, turned out to be Bill Clinton, Bob Dole reading Bill Clinton, and Republican candidate beating Barack Obama, none of which came to pass.

Let's bring in our panel, former White House press secretary, Ari Fleischer, Mollie Hemingway, senior editor at "The Federalist," and Jeff Mason, White House correspondent for Reuters. Ari, a lot of people say why do you make so much out of polls, why do you focus on it, we're so far away. The president is talking about it and people are obviously focusing, asking him about it.

ARI FLEISCHER, FORMER WHITE HOUSE PRESS SECRETARY: I think polls are worthwhile snapshots. They are only snapshots, and good campaigns change the polling. Good candidates can win if they're losing in a poll.

But if I were the Trump campaign I wouldn't be worried about the polling and that it's close or he's losing in certain states. And when people in the Trump world, and I have heard this repeatedly, say that the polls were wrong last year. They weren't wrong. The final polls, the Real Clear Politics average in 2016 showed Hillary was going to win by 3.2 points. She won the popular vote by 2.1. They were off by just 1.1 percentage points. Now, 2012 in President Obama's race, they were off by 3.2, the final polls, so they were even more accurate in 16 than they were in 12.

So the polls are a worrisome sign for the president. I don't think it means anything at this early point. He certainly can win this race. But it shouldn't be dismissed.

BAIER: Mollie?

MOLLIE HEMINGWAY, SENIOR EDITOR, "THE FEDERALIST": These are what the polls say, and there is no point in denying it, but I don't know if anyone reasonable actually thinks that Bernie Sanders is going to defeat Donald Trump by nine points in a historic landslide. I don't think that these are realistic assessments. But you are seeing these stories about polls, you're seeing stories saying that the Trump campaign is in horrible trouble, and I think it is significant that these stories are coming out. I think it's significant because the media are also part of a large resistance movement. They were utterly humiliated in 2016. They might have tightened up those polls right before election day, but when you look at the months prior to that, we were told and given so much reason to think it was impossible to believe Donald Trump could possibly win.

So the Russia report comes out with a big goose egg. You have not been able to split up the Republican Party as was hoped. And I think what people need is to create the scenario of Trump being in extreme danger when, in fact, the economy is going well. There is global peace. He's doing all right. I'm not saying it's over. It will be a tough race. But I'm suspicious of the narrative that's being set.

BAIER: You looked back, Wall Street was polled and said who is going to win, Hillary Clinton 80-20. And this poll, this is a Real Clear Politics of the Trump approval on the U.S. economy, and the spread is 7.3 percent. This is an average of recent polls, approve 50.8, disapprove 43.5. and Jeff, that's a big deal when you get to Election Day.

JEFF MASON, WHITE HOUSE CORRESPONDENT, REUTERS: Sure. The economy is a strength for President Trump. That's why he talks about it a lot. He has good reason to talk about it a lot. And he'll continue to do that on the trail. He does that at the White House. But that doesn't make up for the fact that these polls do show that not only Biden but a number of other Democratic candidates right now would, according to them, according to these polls, beat him in a general election. So that has got to be concerning to his campaign even if he is dismissing the information now.

I think, however, it's also important to realize, and Mollie and Ari sort of touched on this, it's June of 2019. So it's early. A lot of things can change, and a lot of things probably will.

BAIER: Right. OK, let's talk about, this is the president today on China.

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DONALD TRUMP, PRESIDENT: We had China opened up to trade. That's a big thing. They've never done that before. We've had intellectual property theft taken care of and taken care of beautifully, and all of a sudden, those things started to disappear at the end after they were fully negotiated. I think that we'll end up making a deal with China. I have no deadline. My deadline is what's up here.

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BAIER: What's up there in his head. No deadline, but they are sending optimistic signals that they think they can get China back to this table.

FLEISCHER: Bret, I'm here to tell you, all the things President Trump has taken on, this is the most long-lasting, most consequential thing he's doing. If he can get China to finally behave like other nations around the world and follow the rule of law and not cheat and not steal from American businesses in order to do business in China, it will have dramatic long- term impact on the American people and our economy, and be good for the rule of law around the world.

So his ability, his willingness to do things that no other politician would -- use tariffs as a way to bring China to the table and get leverage, I've got a solution for this. Economists will tell you don't do it, it's a mistake. He might prove everybody wrong on this one. And so far, so good. Nothing agreed to yet. But I hope he's right. I hope we get an agreement. That would be the best course of all.

BAIER: Go ahead.

MASON: Not only nothing agreed to yet. The talks fell apart just a couple months ago, and that was actually in response to my question at the press conference today. And it's relevant particularly because the president is about to go to the G20 in a few weeks and may be meeting with President Xi. He says he will meet with President Xi of China. Probably the best outcome of that meeting would be to get the talks back on the table because my question was, what is your deadline for getting the next round of tariffs started, and he said, as you just played, no deadline right now.

BAIER: When the president talks about the Mueller report, he says no collision, no obstruction. He says it's time to move on and that Democrats are obsessed with this. He just did an interview with George Stephanopoulos with ABC in which he was asked something like, if you get a foreign government that has stuff on your opponent, what would you do? Take a lesson.

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UNIDENTIFIED MALE: During this campaign this time around, if foreigners, if Russia, if China, someone else offers you information on an opponent, should they accept it, or should they call the FBI?

DONALD TRUMP, PRESIDENT: I think maybe you do both. I think you might want to listen. There's nothing wrong with listening. If somebody called from a country, Norway, we have information on your opponent, I think I'd want to hear it.

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BAIER: Thoughts on that?

HEMINGWAY: This what I've been talking about repeatedly. George Stephanopoulos' good friend Clinton took information from a foreign government. If it is a huge problem to take information from a foreign government, he should be asking her and Democrats. The Democratic National Committee secretly bought and paid for this dossier that by their own accounting was sourced to government officials in Russia. So if this is a huge problem, and many people have been telling us for years that it is, why aren't the media doing more to find out exactly what happened there, why they created this hoax conspiracy theory, how they got it into the highest levels of the government? I would like to see some people ask some tough questions of those people.

BAIER: I knew you'd have an answer to that.

Next up, Bernie Sanders on the virtues of democratic socialism.

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SEN. BERNIE SANDERS, I-VT, D-PRESIDENTIAL CANDIDATE: Democratic socialism means to me requiring and achieving political and economic freedom in every community in this country.

The only way we achieve these goals is through a political revolution. I do understand that I and other progressives will face massive attacks from those who attempt to use the word "socialism" as a slur. But I should also tell you that I have faced and overcome these attacks for decades.

DONALD TRUMP, PRESIDENT: We do not believe in socialism, OK? Is that all right to say?

(APPLAUSE)

TRUMP: Bernie is definitely crazy.

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BAIER: Bernie Sanders today defending democratic socialism, saying that he is running, in his words, on the right track, as you look at some recent polls on this question. Is socialism compatible with American values? Monmouth, not compatible, how you asked the question, obviously. Look at the Gallup poll, would some form of socialism be good or bad thing for the country as a whole? Democrats, good thing, 70-25, and there the break down, female and 18 to 34.

Back with the panel. Jeff, obviously Bernie Sanders saying this is his lane and he's going to pitch it.

MASON: Yes, and he's trying to define it. And he has to do that both for the primary and, if he were to win the nomination, for the general election. And what he's trying to do with that definition is I think try to make it seem a little less scary to people who normally would associate socialism with what we know about socialism from the Soviet Union and from communism and those more --

BAIER: Venezuela.

MASON: Correct, Venezuela, indeed. He then talking in a speech today connecting his version of democratic socialism to FDR, the New Deal, saying he would want to continue that if he were to get to office. So it's about framing, and he needs to frame himself right now in a way that is palatable to people that are finding a little bit more interest in other candidates on the Democratic side.

BAIER: To that point, a Nevada poll out today has Bernie Sanders dropping to third in Nevada, behind Joe Biden and Elizabeth Warren. Elizabeth Warren gaining in Iowa and national polls, many people say for the specific policy proposals she's putting forward. Mollie?

HEMINGWAY: He's slipping but he is still a strong contender. And I think economic populism in general is having a moment. And what's curious about his speech today is really the framing issue. When it comes to the issues, taking on corporations, this is something you're seeing on both sides of the aisle. Elizabeth Warren is asking about algorithmic bias in lending. You had Joe Biden talking about taxing Amazon. You have Republican attorneys general thinking about breaking up tech monopolies.

And so he leaned into the one thing that's actually the least popular which is this framing of these views as socialist. He might have to do that because he's really on the extreme end of socialism, his honeymoon in Soviet Union being an example of how his whole life he has leaned to one end of that. But it just seems odd that he would take the most unpopular aspect and try to lean into it.

BAIER: This is a different run. This last time he made a run of it and put Hillary Clinton on her heels for a bit in the primaries. If you look at favorable/unfavorable right now compared to the 2016 run, his unfavorables are going up.

FLEISCHER: He said in that speech there that he's been dealing with this for decades and always overcame it. That's because represents Vermont, the most liberal state in the country. He wouldn't be able to do it anywhere else. Even poor Vermont tried to do Medicare for all and couldn't afford it and pulled the chalks on doing it.

He said elsewhere in that speech that socialism is for compassion, justice, and love. I don't know what nation on earth socialism has ever achieved those objectives. Freedom achieves those objectives. What socialism has brought to tens of millions around the world instead is oppression, injustice, and scarcity. This is what socialism delivers.

So we started with the polls. One of the reasons the president has some difficulty in the polls now is he hasn't had a chance to make his case against his opponent yet. His opponent is an unknown generic Democrat. A generic Democrat will always poll better than a real Democrat until you can bring issues like Bernie's against him.

BAIER: Right, which is why these debates coming up are very important. The first one in a couple weeks as you look live in Tempe, Arizona. We've been showing you on screen, we have the town hall tomorrow night with Julian Castro. Immigration will be a big topic there in Arizona, and that's a big topic really the president is trying to use as well against Democrats.

MASON: Absolutely. It's one of his key areas that he's been working on, both as a candidate going into the 2016 election and since coming into the White House. And he will absolutely hammer Democrats about that, and he gets enthusiasm obviously from his base for that reason as well.

BAIER: Panel, thank you. When we come back, an honor for a former president.

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BAIER: Finally tonight, some things do last forever. The U.S. Postal Service issued a commemorative forever stamp honoring late President George H. W. Bush today on this what would have been his 95th birthday. This historic stamp went on sale today.

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UNIDENTIFIED MALE: For years President Bush taught us how to serve, how to live, and how to love. It's especially fitting to honor President Bush with his own stamp because he truly understood the power of a handwritten letter.

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BAIER: He did, indeed.

Thanks for inviting us into your home tonight. That's it for the “Special Report,” fair, balanced, and unafraid. "The Story" hosted by Martha MacCallum starts right now. And we are making our way to Tempe, Arizona, for our big town hall with Julian Castro tomorrow night.

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