Updated

This is a rush transcript from "The Five," May 23, 2017. This copy may not be in its final form and may be updated.

DANA PERINO, CO-HOST: Hello, everyone. I am Dana Perino. Along with Kimberly Guilfoyle, Juan Williams, Jesse Watters and Greg Gutfeld. It's 9 o'clock in New York City and this is "The Five."

We began tonight with the latest out of Manchester, England where last night a suicide bomber killed 22 and injured over 50 when he detonated as crowd exited the concert by pop star Ariana Grande. President Trump reacted to the bombing with a message to all terrorists.

(BEGIN VIDEO CLIP)

PRESIDENT DONALD TRUMP: So many young, beautiful innocent people living and enjoying their lives, murdered by evil losers in life. I won't call the monsters because they would like that term. They would think that's a great name. I will call them from now on "losers" because that's what they are. They are losers.

(END VIDEO CLIP)

PERINO: And late this evening, British Prime Minister Theresa May warned there could soon be more attacks to come in the United Kingdom.

(BEGIN VIDEO CLIP)

BRITISH PRIME MINISTER THERESA MAY: The threat level should be increased for the time being. From severe to critical. This means that their assessment is not only there's an attacked remained highly likely but there is a further attack maybe imminent.

(END VIDEO CLIP)

PERINO: Joining us now with the latest from Manchester is foreign correspondent Benjamin Hall. Benjamin, that was a very stern and kind of scary warning from the Prime Minister.

BENJAMIN HALL, FOX NEWS: Dana, absolutely. That is the big news tonight. That the U.K. has raised its terror level. And it believes an attack could be imminent. And what that means practically is that there will be military. There will be soldiers on the streets of the UK tomorrow. And what they're saying is they're not sure if the attacker acted alone or if he was part of a bigger network. And that's what the concern is now. It all began last night at 10:30 at the arena, which I'm standing in front of at the moment.

When this suicide attacker waited for the concert to end, waited for the young people to leave before blowing himself up surrounded by them. And it wasn't just the nails, the bolts and the shrapnel that killed him, it was the crash that wounded so many of them afterwards. The youngest victim was just eight years old. Her name was Saffie Rose Roussos. Her mother and her sister are both in hospital. And we know at first they thought she might have been missing but she was indeed we now know dead. Eight years old, the bomber has also now been named as Salman Abedi.

That is no picture of him yet but we know he was 22-years-old, of Libyan descent, he was born in Manchester but he was the son of refugees. Now, forensic teams today searched properties around the city, they carried out, controlled explosion and they also arrested a 23-year-old man. Still unclear about what connection he has of this. But we do know that Abedi had come back from Libya just recently. And that's going to be a connection people will look out very closely.

ISIS have of course now claimed responsibility for this. There's some confusion on this, social media pages. Some of them say that he was inspired by ISIS, others say he was directed by them. And that is a very clear distinction. What is also clear is that this bomb was far more powerful, far more planned as others have been before. And that is very worrying. The U.K. government now very concerned that another attack might be imminent because to all of these pointers. So, you know, a horrible tragedy here. Twenty two dead. Twelve of them under the age of 16 and the U.K. gearing up for another possible attack. And tomorrow, we will see 5,000 soldiers in the streets of the U.K. -- Dana.

PERINO: All right. Thank you, Benjamin. I appreciate your reporting. Kimberly --

KIMBERLY GUILFOYLE, CO-HOST: Yes.

PERINO: Apparently, Abedi was known to authorities.

GUILFOYLE: Yes.

PERINO: And, but not considered a high priority threat. Any insight on that?

GUILFOYLE: So, part of this says, well, you know, at least they are doing their job and they're identifying people but obviously they didn't categorize him in the proper way. Right? Because they thought, okay, we have other people that we considered to be worse actors in the area or in the region and somehow they did this and organize in terms of what their threat level assessment was, how they would prioritize it because it's a matter of resources.

That's troubling because when you hear that and especially if you are parents who lost a child here or child who lost a parent, and you find out they had this person, they knew who he was and yet they didn't focus and prioritize.

PERINO: And he had travels.

GUILFOYLE: Yes. He had traveled and so, you would keep in mind, that's one of the key things that they have looked for, to see if you know, what travel. And now they're going to go through all his, you know, personal accounts, et cetera, to see how he was radicalized, who he was in communication with, to kind of like fan it out in terms of the terror web of connections and who might be someone who is in direct communication with him. They've already been doing some investigation about that it had some success. So, I think that's interesting.

PERINO: Juan, do you think there's anything to the targeting of this like, that ISIS are terrorists know that we have, you know, soft targets children and they obviously care about, there are children too in that region but evil losers as the President called them, we can talk about that in a minute. When they target children, they might not expect the response. It might be even more fierce than it has been in the past with Theresa May and Donald Trump and others like McMaster saying, we have got to take the fight more to the enemy and some more specific way.

JUAN WILLIAMS, CO-HOST: I am not sure how you take the fight to the enemy more effectively. The question is, he and several others, British citizens have gone back to Jihad. Right? I guess. I don't know why he went back to Libya but then they come back home. And it's even more pronounced in France and in Germany, they have more of these people who left and then came back. So, when we talk about soft targets, it just has the impact, you know, on me, of you know, making me more fearful for what will happen.

You go to the ball game or you go to the theater. We know about what has happened in movie theaters in this country. But I mean, you think about the concerts -- the recent concert, there is one in obviously France not so long ago. But you think about these --

PERINO: The Bataclan.

WILLIAMS: The Bataclan. These kinds of soft targets with young people, people who are enjoying life, people who have so much to look forward to. People who are so loved by parents. I mean, you have to protect them. And so, the thing is I think you can't give into the fear but you have to be effective in terms of taking steps. I don't know what you can do because I am told that these fellows' footprints in terms of online activity, which is what I think, I think this, you know, even as you shrink their overseas footprint and people go back home, well, then in essence they start to like metastasize, they start to become a cancer and they get the online instructions and --

PERINO: And in fact, Congressman McCall who is the House Homeland Security Committee chairman, he was on FOX earlier. Jesse, I want you to take a look a listen to this and then respond.

(BEGIN VIDEO CLIP)

REP. MICHAEL MCCAUL (R-TX), HOUSE HOMELAND SECURITY COMMITTEE: Is this a foreign fighter trained in the caliphate, this come back to Europe to conduct terrorist attacks or is it the other individual who is been radicalized over the internet and been told from Raqqa, Syria, from the mother ships to conduct attacks? Either way, it achieves the same result.

(END VIDEO CLIP)

PERINO: Yes. It achieves the same result.

JESSE WATTERS, CO-HOST: Well, at least he is not calling him a lone wolf. Like we've been calling him for the last eight years. We've picked on something, if someone is a U.K. citizen, and then goes to a place like Libya, Iraq, or Syria, Afghanistan and then comes back --

PERINO: And is already known to authorities.

WATTERS: Yes. And then, so, maybe put them on some sort of probation. Maybe have them check into a probation officer. Keep a little more tabs on them. Maybe offer rewards for tipsters. Patriotic Muslims in Manchester. To rat out those guys if they think that there is something wrong going on. Some of these radical clerics get to spew hate speech over there. There's different laws. Maybe they need to do something about the laws over there. Maybe more surveillance. Maybe get some more spies or some more undercover agents in these areas.

Because whatever they're doing now isn't working, there's been a lot of bloodshed in Europe over the last couple of years. I haven't seen a big speech. I haven't seen a new coalition. I haven't seen a big military push anywhere. You know, I remember after 9/11, you know, Bush went to war in Iraq and Afghanistan, he set a black sites, he water boarded people. Enhanced surveillance. Nothing like that at least from my understanding has been done in Europe. And you get to a point where we say, how much death is Europe going to tolerate?

PERINO: Greg, this -- initially everyone thought that the bombing had happened inside the arena but it actually was just outside the exits. So then, there was talk today that how can you extend the perimeter even further? But you can't continue to extend the perimeter all the way up to our front doors.

GREG GUTFELD, CO-HOST: Well, I mean, in a way, we can. And the way we do that is we combined community policing, with community awareness. So, it's not just we are relying on the police or the authorities who know this person as a suspect. We all have to become part of a civil defense. It is our responsibility and we are all handcuffed by the fear of being called a bigot. So, if you are on a bus and you think something weird is going on, you go through this mind, this equation like if I say and do something and I am wrong, I am a bigot.

And so, everybody instead, they do their little hashtag and they say, you know, in classrooms right now, we devote so much time to the gospel of diversity but we have not taught anybody about how to deal with a death cult. And it seems to me that it would be far more valuable use of time, if you sat young people down and you told them about this virus. Because it is a virus. We hear the same story about this type of guy over and over again.

He is young, he is involved in this toxic doctrine, he seems unassuming. And then it just happens. It's like he is totally healthy until he has rabies, a mental rabies, and kills. So, we have to go to the source. You have to go to young people. And you have to declare this as a public health concern. That this is something that infects everybody. And then you have to look at security as an industry that one should major in in college. It should be like electrical engineering. Where, you can have electrical engineering without security.

The security should be as big as any kind of industry. Whether it's entertainment or academia or media. Security should be something that you want to get into and that you want to be trained and then create. It should be a trillion dollar industry of people who want to fight probably the biggest fight of their lives. We devote too much avoiding this fact. We are dealing with a religion which may be perverted to believe that you either join us or you die.

PERINO: Right. It's not a territorial fight.

GUTFELD: And the reason why they picked kids is because they want you to join the fight so we should indulge them.

GUILFOYLE: But you know, Dana, when you set about extending the perimeter, we think about airports -- like this is the ultimate soft target. I mean, people said this because you have children there, you have parents coming to pick them up, it's just so horrifying. It just defies any sense of humanity. And the fact of the matter is, when they put it in that small area versus a large arena, it gives more power to the blast because of the concussive impact of the bombs.

Which makes it even deadlier. And in terms of the level of sophistication of those bombs, it shows that this guy wasn't acting alone. He didn't make that, you know, at home on the internet. It was far more sophisticated. So, that is the question. So, how did this come to be? Who gave him that? This is somebody who traveled. Like all the warning signs and bells were there. So, how do you not miss this again? And especially it happening, you know, in England. And the U.K. I mean, come on!

GUTFELD: But the reason why it happened is because every time it happens, people express horror and then they move on. On the Trump -- President Trump calling them evil losers in life. It's really an important thing. Because you have to destroy the myth that these guys are winners and warriors. When in fact, they are unlikable outcasts in their own society. And language is the place to do that.

PERINO: They are not martyrs. Right.

GUTFELD: Yes. They are not martyrs. You are an evil loser. Yes. You are an evil loser. You never met a girl.

WATTERS: Remember the lion's head and crooked Hillary? That seems to be pretty effective.

PERINO: All right. We have got more to come on this. Greg is going to share his thoughts on -- the evil of terrorism, you're going to want to hear this, let's stay tuned, please.

(COMMERCIAL BREAK)

GUTFELD: So after every terror attack, a producer will email me and ask me to do a monologue on why we must fight evil. But after so many attacks, I could write it in my sleep. So, instead let's ponder the barriers to combating terror.

Consider Islamaphobia: An accusation meant to smear those who dare to mention the cause of terror. Media and academia uses it as a way of not judging evil. It's an offshoot of something called relativism which deems us in capable of judging evil because America is just as bad -- we have a bad past, even though we aren't bad now. The goal: To remove our moral authority to act.

So, when there is an attack, you see the timid masses say: if only we were less bigoted, this wouldn't happen. And then the young people tweet: #peace, love conquers. But it doesn't. It's as if the hyper-tolerant are pleading to the terrorists: I'm not the one you want, it's those guys. But the theme will always kill you too. Relativism and its cowardly false tolerance create dead ducks. It says fold instead of fight. Don't listen.

We must reclaim our moral authority. And we need to instruct others to do the same. Enough vigils, we need vigilance and a willingness to act. That requires training of both body and mind. What prevented terror on that train in Paris in 2015? It was three men trained in body and mind. You become a hard target and others might follow.

Last, let's once and for all dump this false war between freedom and security. Security preserves freedom, which is why as I speak right now, well-trained law enforcement surround this building. Why should I have that luxury and not you?

So, Dana, that false conflict, security, sacrifices freedom -- it drives me crazy because it's not true. It never has been true. And it impedes our need to surveil and to actually make our country as free as possible through protection.

PERINO: Remember you had me listen to the podcast where General Michael Hayden was interviewed by Sam Harris.

GUTFELD: Yes.

PERINO: And one of the things he said was a moving line.

GUTFELD: Yes.

PERINO: Of course you want to protect the privacy of citizens. And then 9/11 happened. How do we prevent that will never happen? And again, where are the tools available? Maybe as an American public we say it should move a little bit this way, we need more. You get these homegrown bombers. I don't think they are lone wolves. Because they are all interconnected somehow on the internet.

GUTFELD: Uh-hm.

PERINO: And then you also have the idea that they have, the capacity to actually raise money. So, ISIS, I know that we are degrading their abilities in Syria we cost you a lot more. And then you have the bigger problem, which is, this is a generational war. It's a war of ideas. So, our ideas have to be a better. Our idea can't be -- we're not good enough, we're used to be bad. Therefore, we kind of deserve this. Like I actually like the tough talk from President Trump today. And I also like that was very realistic. He said, they are evil losers and we will have more of them. But make no mistake, they are losers.

GUTFELD: Yes.

PERINO: And he said, we will have more of them. And I think we have to understand he is very clear eyed about the threat. And he is the leader of the free world. And next week at NATO, I think he will be able to basically rally them to do more.

GUTFELD: Yes. You know, Kimberly, we always in the media raise awareness for everything, raise awareness for childhood obesity, for global warming but we never raise awareness for Jihadism. We don't. We just don't --

GUILFOYLE: Because then you are the bad guy.

GUTFELD: Yes. Exactly.

GUILFOYLE: You are the person who has a lot of psychological problems. He is bigoted or racists or something. Listen, in this particular situation, you know, Dana, I agree with you. I think the President was very strong in his messaging. He started, you know, yesterday with the drive them out and then today, the rhetoric saying, evil losers. Words do matter and his language and focus on this I think has been just like laser pinpointed. Which is really important. And people are listening.

The world is listening. He's over in the Middle East, he is in Israel, and now grown, and he's sending a message and he's speaking from around the world about something that connects all of us. Everybody should be united on this front. It's not about who's done bad things in the past, like what are we dealing with? Right now, it's a clear and present danger. And it's okay to call them exactly what you think they are. And it's okay to fight them and to want to kill them and to wipe them out and annihilate them. That should be the goal.

GUTFELD: Yes.

GUILFOYLE: Don't apologize for that. You want to apologize for trying to keep families and women and children safe and free from Jihad? Everybody should be united in that approach. And I think his message is very strong too saying, you know, the Muslims are partners in this in terms of eradicating Islamic, you know, Jihad.

GUTFELD: Jesse, before I asked you this question, do you realize the accusation of Islamophobia will be thrown at you the moment you say anything critical? But that's --

GUILFOYLE: Don't be afraid. If you are critical of like radical Islam, there will be factions who will say, you are the root of the problem.

WATTERS: Well, this has nothing to do with Islamophobia and the people they're talking about that understand that the victims were English girls. Okay? The person that perpetrated it was Islamic. And I also heard somebody on MSNBC, Katty Kay from the BBC say that we have to get used to terrorist attacks like this. No, we don't. Try telling that to the mom of the eight-year-old. Also you have Katy Perry was asked what her reaction was, how do we address terror? And she said we address terror with love and open borders.

GUILFOYLE: Yes. No borders --

WATTERS: Now is not the time to listen to this. We need clarity. We need vision. In the last eight years, it's been very wishy, washy. They've made the language like workplace violence, they've talked about gun violence. You know, they've underestimated the jay-vee team. They've done everything they can to excuse it. Not even saying radical Islam. So, I think it's very refreshing to have a president now that really pinpoints the evil for what it is.

GUILFOYLE: Somebody should write a column about this.

WILLIAMS: Yes. I would call it simplicity and simple minded thinking. Because, let me finish this point, Greg. This is a totally different situation and everybody here say, oh, yes, we just need tough language. Well, President Trump was over there in Saudi Arabia, the source of the 9/11 bomb. I didn't hear him talking about radical Islamic Jihad like the right was pushing on President Obama.

Instead, realizing the circumstance today, he's talking about these folks as juvenile losers on the like. I think that's redefining our concept of what is taking place. Because we got to remember, I mean, to me, we have to go back, President Bush invaded in response to 9/11. President Obama comes and he says, you know what? We want to make it clear we are pulling troops back. We are going to deal with this differently. We will going to talk about the ideology. We're going to make sure you don't think and both President Bush and President Obama said, not a war against the Islamic world.

WATTERS: Well, he retreated from Iraq and then let ISIS takeover.

WILLIAMS: That's not true. Please --

WATTERS: That war was won.

WILLIAMS: That is not true.

WATTERS: That war was won by Bush --

(CROSSTALK)

WATTERS: -- even Joe Biden said, the war was won.

WILLIAMS: That's ridiculous. I think those -- what we are dealing with at the moment is, we have had a changing circumstance in Syria. Where we have this open warfare. We've had this changing circumstance in Libya, and this young man is linked to Libya. And we have had a changing circumstance it seems to me even in places like Turkey and Afghanistan.

GUTFELD: But Juan, okay, can I interrupt you?

WILLIAMS: Sure.

GUTFELD: Because I had a question about the topic.

WILLIAMS: Go ahead.

GUTFELD: Which is -- our response to an immediate terror attack and why is it that we are incapable of dealing with it? My question --

WILLIAMS: We are not. We are tougher today, Greg.

GUTFELD: No. The last four decades, our moral authority has been subverted by the relativism of modern liberalism. We -- our society is always the root of the problem. That is why when you go on Twitter and when you listen to the left, it's always no, don't jump to conclusions. No. Peace and love. That's the problem.

WILLIAMS: No. So, don't jump to conclusions is smart. Because what you want to do is identify your real opponent and stop --

GUTFELD: Unless it's a state hate crime, obviously it's real.

(CROSSTALK)

GUTFELD: Obviously, it's real. My point is, we are incapable of calling this what it is. And we can't fight it because of the modern left's ability to handcuff people with this liberal guilt. We cannot call it what it is.

WILLIAMS: I think you might enjoy saying, it's liberal guilt.

GUTFELD: Of course it is.

WILLIAMS: I don't think it's liberal guilt and I've been victimized by it myself in terms of saying, I was afraid of people dressed in Islam.

GUTFELD: Right. So, you're an example.

WILLIAMS: But what I want to say, I don't think that is what stopping somebody like this guy in Britain. This guy and the idea of --

GUTFELD: They're not chasing him down for fear, of being called a bigot.

WILLIAMS: They would be delighted. Look, Britain had so much surveillance. They will be delighted.

WATTERS: Juan, what happened in San Bernardino, the neighbor didn't rat the guy out across the street because he was afraid of being called a bigot.

WILLIAMS: No, you know what?

GUTFELD: That's a fact.

WILLIAMS: I think a lot of people after the fact are --

(CROSSTALK)

GUTFELD: What about the Belgian police? What about the Belgian police? You can't raid because of a curfew.

WILLIAMS: Look --

GUTFELD: Because they can't people's feelings.

WILLIAMS: I think when you have destructive, indiscriminate violence, it's hard to stop and we have hardened our -- we have done enough.

GUILFOYLE: They are not hard enough.

WILLIAMS: Well, I don't know. I don't want to give up my privacy. I don't want to give up my rights.

PERINO: That's what I was just saying, is that, never mind.

GUTFELD: All right. We got to move on.

GUILFOYLE: Great point.

GUTFELD: Directly ahead.

(LAUGHTER)

What does the Manchester terror attack mean for our safety here in the USA? More of that analysis, when we come back.

GUILFOYLE: All right.

(COMMERCIAL BREAK)

GUILFOYLE: Welcome back. The bombing in Manchester last night is raising serious concerns about America's ability to stop an attack on this side of the pond.

Joining us now with a report on the threat level in the United States is Chief Intelligence Correspondent Catherine Herridge. Good evening, Catherine.

CATHERINE HERRIDGE, CHIEF INTELLIGENCE CORRESPONDENT FOR FOX NEWS: Thank you, Kimberly. A U.S. government official tells Fox News that the evidence strongly suggests this 22-year-old suspect in Britain was coached and trained for the operation either online or by a terrorist operative.

The official says key elements of the plot show experience in premeditation (inaudible) the bomb explosion at the (inaudible) high traffic exit perfect placement designed to maximize casualties.

Tonight, investigators are focused on a possible support network and whether the attack was inspired by, enabled or directed by a foreign terrorist organization. This morning in Capitol Hill, the man who oversees the nation's 17 intelligence agencies said his analysts are working to verify the (inaudible) of responsibility by ISIS.

(START VIDEO CLIP)

DAN COATS, DIRECTOR OF NATIONAL INTELLIGENCE: Threat is real. It is not going away. It needs significant attention to do everything we can to protect our people from these kinds of attacks. We assess ISIS will continue to be an active terrorist threat to the United States due to its proven ability to direct and inspire attacks against the wide range of targets around the world.

(END VIDEO CLIP)

HERRIDGE: Investigators are building a picture of the suspect; his travel as well as with who he communicated, a forensic review of the improvised explosive device is underway, and the shrapnel used (inaudible) is considered a vital clue because investigators can trace it to a manufacturer and where it was sold.

The 22-year-old suspect was known to British authorities, but a U.S. government official said a preliminary review of terror databases in this country suggested he was not known to us. Both countries struggled to track terror suspects who may be radicalized with record numbers returning now from Iraq and Syria. Kimberly?

GUILFOYLE: All right. Catherine, thank you so much for that update.

HERRIDGE: You're welcome.

GUILFOYLE: Dana, we discussed previously in the program, somebody who didn't have (inaudible) social media imprint but nevertheless was known and actually popped up in the system due to his travel, er cetera. Somebody obviously that has been planning this. The level of, I guess, premeditation in terms of carrying out this attack just really shows how much damage one person can do.

PERINO: It's interesting about the one person. I don't know if we have this video, but if we do, you can play it while I am talking. Today, the British police decided they are going to enter the home. If you look at that video, there is about 35 police officers that go to do that. So, the amount of resources that we spend trying to track down one person, we are a little bit outmanned.

So, what Greg was just talking about beforehand is we have to change our thinking and our approach in a way to utilize all of those people that are willing to dedicate their lives, the law enforcement and intelligence. Also, we have to use either technology or figure out some way to include community policing and more intelligence.

We will get to those very difficult privacy issues that people in the U.K. and people in America like to enjoy. But the number of people that have to work to try to stop one person is astronomical.

GUILFOYLE: They need to deputize everybody, right? See something, say something, get involved, care about your community.

GUTFELD: We have to get involved because this is a secret disease that doesn't become self-evident until it's almost too late. I have to say, one of the things that -- I think we've got to change the way we look at things. This is not 1942. It is not 1962. You have a radical movement that has an apocalyptic goal. You have technology married to terror and the more you kill, the quicker you get to heaven.

So it requires an adult size view of security and surveillance. You can't keep throwing that Benjamin Franklin quote at me, you know. Purchase safety. You know, if you give up liberty, to purchase safety means you deserve neither. No. He was actually talking about literally purchasing safety for frontier defense. That's a stupid idea. We need security and freedom together. And then we'll win.

GUILFOYLE: Okay. Jesse?

WATTERS: Most popular baby name in London right now is Mohammad. The Muslim population in the United Kingdom has increased to about 1.5 million over the last 15 years. This guy, British citizen, but son of Libyan refugees. If I was living in Libya under Gaddafi, I would probably try to leave too. You have to be smart and compassionate about your immigration policy.

If America is a melting pot, we can kind of control the ingredients that we bring in. We bring in some tomatoes, some potatoes, some sage, and then you see some wine coming in, knocking on the door of the pot, and you are like, well, listen, doesn't smell right, from a risky region, maybe not a lot of rain that season. Let's not throw it in the mix and then ruin the whole dish.

GUTFELD: I'll take the wine.

WATTERS: Okay.

GUILFOYLE: You've been drinking.

WATTERS: I'm hungry now.

GUTFELD: I have very low standards. I will take the wine.

GUILFOYLE: I think you're hungry and could use a drink. Juan, save us.

(LAUGHTER)

WILLIAMS: I don't know what to save you about this.

WATTERS: Great analogy. You can just say that one.

WILLIAMS: We have a history of discriminating against people and I think that's not American. But I will say this. I think what Dan Coats said today was so important, that the terror threat is not going away. We can minimize it, but -- and here's why it's not going away. Because homegrown terror, people who are citizens (inaudible) guy here in the United States as we have seen, San Bernardino, I could go on.

That is the threat right now especially with the internet as an entree, as a portal if you will, for spreading this kind of crazy disease and training. So the question is, how do you respond? I think that is the challenge today. You stop people from coming in? I don't know if that's the way, I think.

(CROSSTALK)

GUTFELD: Wait. You just did what I said you were going to do.

WILLIAMS: Go ahead.

GUTFELD: You introduced relativism.

WILLIAMS: How?

GUTFELD: He said because we have a history of discrimination -- that's in our past. It makes us harder for us to deal with this modern threat. No.

WILLIAMS: No, you are wrong.

GUTFELD: We are a new country. We are a new country. We are -- this history of discrimination is in the past.

WILLIAMS: No.

GUTFELD: Oh, yes. People have the freedom for education, for jobs. When you throw that out there, it prevents people from making the gutsy move and saying it's time to act. You can't say oh, we have a history of discrimination.

WILLIAMS: I think you are -- no, we have a real history especially when it comes to Muslims and this is at stake right now in our courts. Where President Trump has proposed.

GUTFELD: You are playing into the Islamophobia phobia.

WILLIAMS: Oh, no. You are playing a totally dangerous game. A very dangerous game.

GUTFELD: No, it's not. Why? Because I'm talking tough?

WILLIAMS: No, I thought you're done (ph).

GUTFELD: No, because Donald Trump talk tough, he was embraced by 50 Muslim leaders. We were told that we called a spade a spade and said it was radical Islam, that all the Muslims would hate us. No, Trump shows up there and they are all happy.

WILLIAMS: Yes, and guess what.

GUILFOYLE: Giant posters everywhere. WILLIAMS: Radical Islamic terrorists.

GUTFELD: He said Islamic terrorism. Pretty close. Islamic terrorism.

GUILFOYLE: And he said drive them out.

GUTFELD: Islamic terrorism is what he said.

WILLIAMS: He didn't use that language.

GUTFELD: He used Islamic terrorism.

WILLIAMS: And guess what? He didn't talk about banning all Muslims from coming into the country. He didn't certainly use that language.

(CROSSTALK)

GUILFOYLE: That wasn't the intention to begin with. It was to basically make sure that we have adequate security measures to properly bet (ph) people coming from high-intensity areas and regions that have terrorism and there is evidence of it.

WILLIAMS: If that's the case, we wouldn't have it into two courts that have stopped it in the third court. It's a violation of our constitution.

GUTFELD: Every time you begin with we have a history of discrimination, you take the legs out of any progress. It's an argument -- you say we we have a history of discrimination and you go, I don't really know what we can do about this because you just laid the feet.

WILLIAMS: No, we don't, because we have real steps to identify real terrorists and that's why we have been successful in stopping another 9/11.

GUILFOYLE: Okay. I'm driving us out.

(LAUGHTER)

GUILFOYLE: Up ahead, some sunny examples of media bias. You won't believe this.

(COMMERCIAL BREAK)

WATTERS: We told you about a new Harvard study that shows President Trump receiving an overwhelming amount of negative coverage. Only 17 percent of "The Washington Post" coverage was positive and it doesn't look like that is changing any time soon. Here's what the Post executive editor had to say this morning.

(START VIDEO CLIP)

MARTIN BARON, WASHINGTON POST EXECUTIVE EDITOR: When I was coming out of high school, there was Nixon and Watergate. And so I was in the middle of that obviously. But this feels like that in many ways. Now, that's not to say that it's a perfect analogy. We'll have to see. We need to see the evidence.

(END VIDEO CLIP)

WATTERS: No evidence, Greg, but it feels like Watergate.

GUTFELD: That's all it takes to 2017, if something feels like a story. We are guilty of it too. No comment, if it feels like a story. But I keep thinking about September 10th, right? September 10, 2001, the preoccupation of a distracted population was the disappearance of Chandra Levy. Do you remember that?

GUILFOYLE: It's Chandra Levy.

GUTFELD: You would know. The prosecutor. That happened in May 2001. It went on forever. It was on every news channel. Suddenly, boom, 9/11. Even though we knew the World Trade Center was bombed in 1993. We just kind of let it - - we just moved on. We moved on. We went on with our lives. Which is what everyone says you are supposed to do. We ended up with 9/11. I get the importance of the Russian story.

I totally understand it. There should be an investigation. But Lord, the Russians are not mutilating young girls with nail bombs. All right? So we can deal with this like collusion -- I am sure the Russians tried to influence the election. I'm sure of it. I don't know if there's collusion. Look into it. But these people are trying to end the world. WATTERS: That's right. Kimberly, last night, some of the competition, all they talked about was Trump. Meanwhile, one of our biggest allies, our biggest, blood in the streets after a nasty terrorist attack. What went on there?

GUILFOYLE: Well, we were chosen. They are watching Fox News for coverage of real news, of breaking news, that it's significant internationally, that was important to cover. So, I mean, I think, there you go. The people made a smart choice. Otherwise, you can continue the story on collusion, collusion. Guess what? Where is that in the criminal penal code? And then they are trying to say.

WILLIAMS: I don't think you have to run away.

GUILFOYLE: . obstruction yet there is no evidence of that either.

WILLIAMS: I don't think you have to ignore what's very real and what's going on at the highest level of the American government. I think we had a real story in London. I think there is a real story here.

(CROSSTALK)

WILLIAMS: Media issue.

WATTERS: Yes.

WILLIAMS: . is that -- you know what? I think Donald Trump has earned a lot of this. I want quote Chris Stirewalt from Fox News Digital, our political editor, who said basically, you know what? If a train wrecks, you got to cover it, right? And Trump has been up that by 40 percent. All the TV news coverage of Trump doing outrageous things, is that negative coverage or just realistic coverage?

PERINO: That's not all desirable (ph).

WATTERS: I think he earned it when he won the election, Juan.

PERINO: I actually read halftime reports. (inaudible). I would say there's no doubt that "The Washington Post" is re-surging after like eight years during President Obama's term. I remember, I lived there. I actually ended my (ph) subscription. This paper, like, there is no.

GUTFELD: They wouldn't dare report anything (inaudible).

PERINO: . and now, they got new ownership, they got Martin Baron as an editor that come in. The staff is energized. They are hiring people left and right. But what I would say is that I think it's important that they just report the news and try to be the news. I think that they are trying to go too fast. I understand trying to advance a story, but slow your roll a little bit.

WATTERS: Slow your roll.

GUTFELD: Dana Perino.

WATTERS: You got that down now, all right?

GUTFELD: I want to know where you learned that phrase. PERINO: I like it.

WATTERS: President Trump unveils his full budget request to congress today. His Democratic critics are (inaudible). But the administration said it is going to benefit you, the taxpayer, next.

(COMMERCIAL BREAK)

WILLIAM MCRAVEN: The Trump administration unveiled $4.1 trillion dollar budget proposal today. It increased spending on defense (inaudible) but there are cuts in funding for Medicaid and food stamps. Here's how the president's budget director explained it.

(START VIDEO CLIP)

MICK MULVANEY, U.S. BUDGET DIRECTOR: We look at spending differently. We are no longer going to measure compassion by the number of programs or the number of people on those programs, but by the number of people we help get off of those programs. That is how you can help people take charge of their own lives again.

(END VIDEO CLIP)

WILLIAMS: Watch this, the Democrats, reacting.

(START VIDEO CLIP)

CHUCK SCHUMER, SENIOR U.S. SENATOR FROM NEW YORK: The Trump budget is comic comic-book villain bad.

BEN CARDIN, SENIOR U.S. SENATOR FROM MARYLAND: The budget will be dead on arrival. But it also reflects I think the priorities of this administration which is very problematic.

NANCY PELOSI, MINORITY LEADER OF THE U.S. HOUSE OF REPRESENTATIVES: This is a killer for the American people. Literally a killer.

(END VIDEO CLIP)

WILLIAMS: Gregory?

GUTFELD: Yes.

WILLIAMS: The most interesting aspect of this is Mick Mulvaney, the budget director, says taxpayer's first budget. What do you think?

GUTFELD: I think there is a lot of great stuff in here. I'm not sure if it's cuts or the rate of growth is being reduced which means it still goes up. They are talking about the -- look at the positives here. Job training, apprenticeships, reforms that encourage work. If you are getting any handouts, encouraging work. You're breaking the grip of dependency. The reforms of the food stamp program.

What this is doing is it's actually raising the question about the war on poverty programs and the effects that they've had. Since the war on poverty, you see racial gaps, income level test scores, unemployment, illegitimacy rates. What if this war on poverty programs actually didn't exist? Billions of people might be independent, successful individuals instead of dependent.

WILLIAMS: You know, Dana, it's an interesting point. We just don't have time for me to go back and forth. Dana, the math is interesting here because they are predicting 3-4 percent growth. Nobody else is. Is that realistic?

PERINO: Well, if they said 3 percent growth, not 4 percent, which I actually think is much more realistic than that. There are a lot of assumptions here, but I think they also have to be prepared. Have facts about how these programs are not working and be ready because the Democrats will be able to roll out all sorts of anecdotes and you have to be ready to fight.

Also, most people on Capitol Hill blew this off because this is not actually going to become a law. There will be a lot of back and forth. Republicans have to decide. Is this the hill you want to die on? Probably not. WILLIAMS: No, in fact, John Quinn (ph), number two in the senate says, this is a nonstarter.

WATTERS: It is dead on arrival but it is a beautiful blueprint.

(LAUGHTER)

WATTERS: I think Mulvaney is a total star. He (inaudible) the switch on the Democrats. He is saying, we want to make sure people get off of welfare, not on welfare. We want to respect taxpayers, not the tax recipients. And then he had a great line when they asked him why you're slashing the budget of the EPA, he goes, the EPA had a climate change musical.

(LAUGHTER)

WATTERS: What kind of thing is that to spend taxpayer money on, Juan? Even you can agree that's ridiculous.

WILLIAMS: It depends how good.

GUTFELD: He likes musical.

WILLIAMS: Kimberly could have been in the musical, and I would have paid to see it.

WATTERS: Oh, maybe.

(LAUGHTER)

GUTFELD: You're such a soccer for flattery.

(LAUGHTER) GUILFOYLE: I wast thinking.

WILLIAMS: But, Kimberly, I want to put it to you.

GUILFOYLE: Yes.

WILLIAMS: Trump said no cut for social security but guess what? Social security disability cuts.

GUILFOYLE: Okay, well, yes. (inaudible) also said (inaudible) that they were going to touch entitlements, et cetera, but the big proposal and focus of this is going to be tax reform. But, nevertheless, tax reform should be the banner here. That should be the headline.

That's what the voters want in terms of the mandate that President Trump was elected on. So, I don't think we are going to see any of these cuts really materialize. I think they got to focus on this. If he doesn't get tax reform done, big trouble for 2018.

WILLIAMS: So, it's all about tax reform. I think that's right. "One More Thing" up next.

(COMMERCIAL BREAK)

PERINO: It's time now for "One More Thing." Greg?

GUTFELD: Just go to this. "Greg's Fitness Tips." Look, you know, the key to a strong back is strong abs. Even for a dog. Check out this workout where the dog is actually doing a really good set of leg lifts. Either that or he has got a painful rectal itch.

(LAUGHTER)

GUTFELD: He's scratching away, everybody.

GUILFOYLE: You're so gross.

GUTFELD: Oh, come on, we're all humans.

PERINO: Jesse (inaudible).

(LAUGHTER)

WATTERS: On another note, Roger Moore who played James Bond in seven Bond films passed away. Age 89. You know, one of the greatest actors in that series. My favorite Bond, actually. I think everybody should raise a glass of a Martini. Shaken, not stirred.

GUTFELD: I'm not surprised he's your favorite.

WATTERS: Why is that?

GUTFELD: Because he was the meanest.

(LAUGHTER)

PERINO: I agree. Okay. Kimberly?

GUILFOYLE: Thank you. A wonderful medical development. This is a touching story for you. Take a look at this adorable toddler, 1-year-old, Annabelle Lawless. She was born last year but now she is hearing clearly for the first time.

Thanks to brand-new cochlear implant device activated by a doctor yesterday in Boise, Idaho. Take a look at how adorable she is. She can finally hear sounds clearly. Thanks to this amazing medical miracle.

PERINO: Look at that smile.

GUILFOYLE: They say it will allow her to someday talk just like any other child. Isn't that incredible?

PERINO: All right. Today is international day to end obstetric fistula. I posted a video on Facebook. You can check that out. You can raise awareness about the condition. Here's a quick stats.

Estimated 2.3 million women and girls with the condition worldwide, about 100,000 cases develop annually, and the condition is entirely preventable. So you can go to freedomfromfistula.org. Find out a lot more and see how you can help. All right. Juan?

WILLIAMS: Marty O'Connor and his mom, Judy, received degree at Chapman University this weekend. Marty is a quadriplegic. His mom moved from Florida to California so she could take every class, take notes for him. The school thought, you know, she deserves a degree too. So they gave her a degree. She said she loves school. Congratulations to you both. What a wonderful story of love unbounded by a mother for her child.

GUILFOYLE: Amazing.

PERINO: I love that story. And look we have extra time.

GUTFELD: How did that happen?

WILLIAMS: Because I ran through it. I ran through it.

PERINO: I don't know. Never miss an episode of "The Five." Listen to our podcast. All sorts of things. Stretching here. "Hannity" is up next.

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