>> welcome, everybody, i'm neil cavuto. a live edition of% >> welcome, everybody, i'm neil cavuto. a live edition of cost of freedom. marrying main livoset with wall strstt and throw inith little of pennsylvania avenue because those developments would be normaily rerkryi-mov. g eve s if they scared the market. they have not with the latest turopverith wa john kels com. in as the new white house chief of staff, replacing reince priebva. nmenren ly wtheyn y d gollps dg what has been a steady parade now of offic ls thav. g, eil just kicked out on their fanny on their own, let'sllasnkithbout wthe t we'vehiestn inrepelhaive short order here. the national security advisor gene stl fs li witasn days of l james comey, holdover acting

hatoith tov % thne stl,repemy, syg r l sean spicer, reince priebus. the nhaional seeputyhieylwiity s bailherr thave. a legal team spokesperson leave. a lot of peostae com. gith wa wt. gatihnt inllass aadv. istration. sometimes those type of shakeupsithosarkherrarkhasrlyit ec of corporate world when we've seen this in the yea see paliv. rbm, i evenrepy, y, syr netflix l results and changes needed. osl ng he e'arkixon comes to m u.s. presidency. shakeups likereponaidrephase pnb seylwit ghsoen a litioniths one our greatest presidents. it depends how y dhiest ithieme osut. menmer uire.ithnty . ave llig lt. colonel tony schaeffer, servt very,dentery s bvi stblt myself, i have great admiration for guys lneeenm d wnew did,

unthssnm d c d yn ly.i.ptoe collection. >> i had those, too. >> good,llthe t whnllthey extitf rey rithlwurisatistl that military n and women have a great deal of di. giplineith wahieete wt wos lhorsllthe t ch be very beneficial, certainly in the corpmenhahrpe adv.d wtheyn l wntheynlltheyy% rmello l you've been doing. and in white houses. seo, i'm wonecg r eee withpturn kelly once he's sworn in to do that job monday >> wen l, urisl thank you for your compliment. i appreciate the serviacllollthy m d ryith wa illas llthe anns one l has served the country very wnell. a wa sesof,sta. egheelog r white house is very important. first, to your hos. t,lltheyos syith ith lherr of in aoithda you just went through a number of names which created, b wol ustctllthe tlltheyy eittheyr we nirforming well, or things were surrounding them, just didarkhe

ait gstt lrlltheyen os whec ny mefeaghrto get put forth. secondly relate today john kels ,ghletselostnithtrchdith l oteaer, he was noted for combat, but he's back here and he was lipmhernllo cowntitak asn l. a wa illas ghhrchderstands politics enough to not become vi aizt elo woit. ngeilaeen g rncva c devearkherr separate his own background and past from trying to getllthey ios whec nsa% th ecliveosd. otase'ly, importantly, related to this, john kelly will do tthy seeverellas l i don't think he took serious l ltiveen vaas president's agenda. >> will the president allowghea oto seo her?

otthey lhask soseee,llthey lhas left and right and that's happening analaniy, thotoeloeit vsnernyark nt inllthey w nt . how does the general john kelly tap down on thatith waithve el ou'thllo seo l >>en os whec llrump has been effective in a short piem ma. ceoshiemcrff wortarsniththodhit you and i have spoke been this. dhs has nherrelostn one of%l sylivrepch orgh wolhaioitt inl government and within a very short time john kels elotrl bol e hgr veness to that mission and he did that, by the way, by,nm d rtars,en os whec s lets- ithf, urisithble to give the general, i guess, heads-up on seomellas he putverels whnithnds it and make it-- turn it into somryias as president trump can be mercurial at times, i tas l l

rapidly by his marine corps he pffre not something like the way that anthony scare mariueiliican ly veropwghrsllass mthan-talking catholic is going to deal with that, but i do rtars wtheynghomelh dhieylwiityn gryiti h alnewsttit whn i-sthme t ith wa theyllhieeklltheyatiall for the controversy, i started to say, reny seghs b i conveyedllass he pryiave sygllthe annt have to take the fall for that, but he dios cetghehiepmdhieomryias ai i hity chuckled at for just frankness and in your face, stt tichaghomelh dhieecurity was trying to do, you have to real wole wthe t wletos sehasli wnith, ol criticize, they should just shut up and supportllthey% ith ith wa wnomith onlltheyatitr line. >> g rght. >> that's a frankness, yeah, right. sed w i'm pe waer. fi fail dsly, of . that type of frank point of lo reiw. freedom, again, i always come back to whatlltheyen os whec

pe ded lryighea of ,lltheynsy that in the west wing? >> i think that that's what's rstecos general patton once talked ou' dtghrs i-smenge ive esolltheyn ery aveith cerge. people interpret you. the good news ianns osai. rllas llthe ten wolestaerep nni that. reince priebus could never rise to tthe t thveghr setheynail in of wthe t com n ustiling in this town, neil, is because of the lack of clear tahasec seeasp. rllas llthe anns one of%l things that john kelly does. and like marineecoghletsn lyhert wng rti watching, don't be upset witg picture. i remember after interviewing asm withllthey osrerkecoghe lo akchave ert , i seresthat tt about northvermenhaseloe hmene e tahiemlatheyd iking b-save ith l

he said this is an alarming ignmene nt, we can- otasecolltheyy'oshienit . glla ingtioness up. it was prescient to what happened% onl ery hrsollair but ngerous world we live in an that seems to tell me thatghe osais w devethat ttn lyryi . chec seetand all of these internation rivalries and silly internation rivalries and silly set w . he was quite vocal and got him in heat withllthey o e s bviaspliv sttion wtheyn theyh about worries about the taliban and al-qaeda and whathieeriova l imagine he would just have a come to jesus moment with evern onnelltheyosith wa stt ottheyrephasl seanger here. this is our priority. this is wthe t wletven lyherrll s.oi opl our job than keeping the ithder en wolestae stt ery e% pesupteeen wolestaeeloffkllo that. >> i think so. and look, heghhnllthey relat l, iilit woto seo l ae p. , no offense to reince priebus, he had no background

to l rherr oce.yllthe tlltheynreldll clarification, he has an ability to lead large he pwihase w stf, n. csyg with t through all the different iterations of worki ld oni sttionsith wagherhr. wnhnhington. so, i think he understands the labo see of wtveith tme . ngeilaeen g rncvaiths% e whithsghe was a politician, he didn't understand the leve see,ghrsllo hagpwhieomryias come out here. and i think that john will get l otthe annsithverovllas leadership, the ability to leverage those things in wtveith tme lltheynsy e hgr ver, service, losing your own son in he phatler, >>llthe annsen ose lt. colonel tony scthe e hgrsyg >ehasthiest. gen o d hpmn. you, neil. >> and role of chief of staff. dtheynn onellyever wonecr wthe o ltivellthey woa what if i were to tell you some of our% annsthiee wacfeful ing nresith f, nllith dlltheynt

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>> all right, the best tolltheyen os whec is di> hsnline, kstpllhe administration in focus doesn't always work out l taeery stt of , fail dll gy,ithn lyhieed chief of staff can make a difference. osr onellthe annsrepch overeloy

bofe c deve% ne eith difference, too. explain that role, what sery,si ephasn ly of o >>en o d rtaow, it's a great question, neil, because it's momsta at . hhn% h y different contradictory jobs. the chief of staff iecais co trlslltheyati grw ofen wolestaa rnformation and paper in and out of the oval office. wnelacf illas whrcanithlrhasha livg rldllthe t one off the lis for general kelly with presidith ve eetknp. 'sarkherrithboutllohietopelog r people in at his pleasure. the most important thing tthe th the most important thing tthe th mase h ofhiege n lyhlivhieuccessful ones have always done this, is to tell l of nthat tt wh tllo theyar. more than anyone else in the white house,llthey case h ofhiee ery hnn lyherrlltheo tell the president when he is going off kiedaer. ticith ghso i, thtilakingatipmla an l presidents that have stupid moments as we all do as humh

he pei he pei otthey case h ofhiege that has to right the ship when the preside . llthey wrong seiryltionith wa iannsark easy to do and kickly in this white house. reil: i pe waer,ghrseedelone e i hsver. d ofllershust in thae with the iran-contra thing and a lherr ofllea nlltheys coselot . llthey% resecte ofith crisis, new ones are and this is the case ery ere,elout illas lltheyatihiesliv menecr ofelova. nsatimenptohn kelly shall the crisis of this white hovahranifefslltheynsy tahasr almost like a vipers nest. it's so rampant and co, thsoave , veropf ounewwen o dn lyryiith the wath on that and if you reveal or find out the identity osf l ticha setheynn onu of o >> well, you said leaker and i know leaker is very, neiery tawiaillakdeloyllnewani wnew s- identify the sources.

when you're not happy and a the . ithatieud witg xyith wa z in ticithrhouse, here is where general kelly being a diliv. t.sotheyd one,% pesu% ne eith roslaer, because when he stares the staff down and says if ighhasr h y ofen o d er-bit. githe p. h y others, you're out. or i'm going to recommend livtr sones it may be more a question of ba he pffk-st. ti the chief of staff has that irser. wnnew,llthe tn lyryiseloffkllole issue we get to in the beginning. lthe t n onu'veveroponel orghsotorical followed, had that ability that smenve eof ailac-liken lyg rpllr ottheyen os whec lcuanid? >> i'm not sure that general kelly has the teaello seo it, he put i w devegh that

t the-- he could look to the chie h of livksf sewi. g eianinhrser. -theynth ithdams managed that white house very well for arene stl eiani. irser. ery e whn banidlloghav. gith case h of staff. by the way, he had a passion lr h onymitts otthe annsithovaurisghelpfoc in chief of staff. a passion for anonymity. jvatlloghelpllthey ing nresith alghpmg seresith very good job a critical moment, another on,ith erai,atimenrep he rd aspxoanoiths assen os wheclay whn deteriorating. neil: that's right. h ala the lfatimenatimend seuri transition. you mentioned howard dhow asyeaelo,aldr ishietin l liail asyanoies baker from texas, we think of him with george h.w. he pvaesu% ngfeffefsyr,ghe whn withrephase and a terrific job. i'd be on the phone to james drithn lyh reldr oh

baker has a wealth of knowledge. neilhiefh den utti rint, it sounds cliche, but military guys thaannsver. d of inllthey s.lg aioss bcet -o iict wondering, you talk about who would be allowed into otthey wasave gh dani orllollai l were-- you expressed your doubtithsllo wntheyl pe ocd have that ability to sort of police who goes in and out ofllthey wasave gh daniith wa i out that. because if he can't control thayou slltheynllthe annsllthe e ottheyen trblfefrep clesu l >> it's a big part of the problem. rrs, gr. study for what not to do is hr ery aiecnth , wnew f timen% h y years under nixon. neil: right, right. on,lln. he was great at managing who got to see the preside ith wa tichaver. d of il otthey president. but he would never ever contradi lthey ing nresith ed ery hrpe ocdarkever president, mr. president, you're off the track.

otasthoson lyt wh distt and sure enough, it led to disaster. reibouelouten g rmenllo l tahasdlloith lh ent lide re, right? >> sure. butghe whnwotlltheyen akit in lylln h. g l credit for helping nixon achieve thellas . atimeneignen ak was in were very significant. not just henry kissinger. ery r the eveerren% h ht ith lherr of l neil: how do you think this is ailn lyt wh >> wen l, gr. here because let% eeloe h k, reivery a ios whec ll3 afford to fire another chief of staff anytime heron. ig rebvaithlrhasha ghhnlltheyre for the least number of days served as chief of staffatimeni new ing nresith ed ranns neiery b dhat.aillo switch after six months. i don't think ttheyen os whec i h sllon lyryirepres ofverels anytime soon. so that means kelly's power is reximizedrep clesu opcome ery hrcanhieryihieo

insist upon them and i think nt wh atimen ni that rth inllthey wasave gh y against those rules. neil: how do you think he's e way. gllon lyryiith gr >> well, you know, between the two, and of course,en o dveropw th wa iveropwgheaith little bit and we like one thing about him, he's rgelih -ameg rcan, g r gyou s n. neil:eloutllthey lh t.age coulde dragging us down. >> it's not justllthey la rannthol somebody from the outside could come in and disrupt thitho allthasha cthe herr wasave gh dani evith n lyhos. so, i'm sure general kelly, i assume, willghavehieome cos. pe astsatimen% how i eeanoie w. neil: i'll leave it at that. larry, good to see you hpm of my of >>llthe asu, neil. neil: what happens to the department of homeland -ylwiity? lllthe t hos whtion, right? the former homeland security -ylosgery,% he el cthey whaoff, on l dear predictable, there's no other way to say this. it's over.

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>> all right. we'ren lyt wh aarkewghomelh dhieylwiity secretary right now. that's because john kels is e way. g on,ithsen o dveropwel toeloe the president's new chief of staff. formerhieylosgeryati,vof,vix,v,c he pvaers% he el chertoff on the phone. >> good to be on, neil. neil: ianns . ave osliv. g,ll hos whtion has taken on more importance now especially with l issues, that was near and dear, of cowiani,llon lyith eraiverel it whnlltheyn asu. what type of person should be looked at for that job? reimerlltheyosithre a broad ran of issues, not just border -ylwiitcet wnhrthe veithmebhaionhieylwiity rfeues, there's dealing with foreign governments. -o,en osear, st moyen o d wh t hermeboha wos.nyn lyherr exper dealing with the department, and withith lherr ofllthey ifenn

otthey ecpa whame . and the good news is, that the deputies are experienced,hiethe anirvt b waer% e wtheyn i whn anithinryiary and she'll do, as well as acting and could be octireave s ithen errene acit wh me , ceeloul others who have experienced dealing withghomelh dhieylwiity eil department, or as people who dealt with the doseeeear, ith t l neil: do you get a sense now that this tightening aroundllthy wnasave gh daniith wa ius tin le line and putting someone like general kelly there isiths chief l bs as to those who work here within the adm. so drhaio of wnhnas reflection of the recognition are lltheyen os whec ith wa ol ee d wagheallthe t werephasn ly at a period of increased risk. we'rearkherr only sehasli

with russia, we have issues with north korhas, even in vith eznevrit, tic so in owi oleav hemisphere we're seeing disorder and as general kelly at thrsseloryiave rllthe n n lyu ery apnius in the f the western hemisphere has a dios iithmatifft onllos.ani wos. live inlltheyarkmenthern part o the hemisphere. neil: i'm think. g of evrit,lltheyy'osghav. gith cous titutional vote to essentially give the government coocalslip i o just chaos if not an outright revolution. otass c deve% ,aelltheyghesto cthe vez otas too far away from our border. soghomelh alanih ng r senghhnll gr. well? >> that's right, one of the l pa wha cees ofith wa i've gotten to know him reasonably well overllthey lhntatiaff% onl checuringe wa. gghrs% e wg ofllthey effect on our border is driven by conditionshie dl he pmenechow wntheynen o dghaveen eople who

afraid of their lives because l hief oiothnce,lltheyosnyn lyh g activity, and there's political upheaval. otos.anien ensstahreeen lyt wh tohieavelltheyhies lhr es and t puts pressure on our border. so in% h y wayselomenecrhieylwiity he peg. s out whec of by having stable environments in s dl osrittiontho. rith ts in the region. neil: i was wondering, too, dtlltheyatihasurinith wallthey cotheynrus llthe tsure oohn kel my interviews with him, in this cly ffityith waen g rmen cly ff dtllos.ani l terror threats. >> geraldo: first from,en o d at thrslltheyllaiibh ith wa ext itllo other terrorist groups. obviously, you guys see on aswi s. nk every% s. nk every% menand th some scary stuff. that you couldwotreposehast or evith eare lrit. elaniticero and that was a constant concern of his. terrorllhrhast whn osai. l ch repreatreatthere'r sewi.

e administration, his musings about that and hrsrephaslllthe l n ay, yllthey wasave ghouse ean because he was scaring ni i hrt ery e whnsure ovath wnillllhis be a priority then, this administration and whoever ottheyyen llosure ovatn lyryi it out l real? >> i think so. l so% ,ae it cthar that this doesn't mean we're going to ph ceelouit sehat s% hasn wadmos y h. glloll,ae it anig r dsly. it means that we have to constantly k lltheyllhies n on drhieylwiity mehnwi n. wne have to update them. i think, for example, we're due e wmenithreprhos w inithmebhaion anih ng r senith wallhat's part what general kelly has been do. githshieylosgery of dhrsl rtithlso% hasus wearkstdllo look at as he's pointed out, transnational cg ritlent, ol mengaand thzationseloylshani wa l religious, they can be quite lo l things that we've seen ave rrmenso senl seo inllthey% resdlhr ihntith wa inarkmenl

neil: all right. michael chertoff, thank y d very veral.chief n alud cha in . g bp with you again. >> great. neil: all ryedesu. jvayou s agpm of athowell and the effect of this, as i said here, of course, l ofithen eeailel here of markets not worried about any of these s.evel i hrme who conmebtheynt llthe t l w,ae-llh, notwithstanding and all the apparent confusion y h. g on in whnas otthey i hy,llthey ol pennsylvania avenue as well that tasthosoarky, yn lyperi itrthat a nsatitrmeloei that they argue progress is already being% s bo o e