down 140 points. left-hand side of the screen, part of the reason why. that is irma, category 5 storm. wind of 180 miles-an-hour. i don't think if it hits florida, we americans have hard time dealing with another big disaster relief fund. that is where i am. neil, its yours. neil: we're out of money. hens this idea of a government of the shut down. i man that tables that. great show as always. to stuart's point, doozy coming down the pike. irma's wind north of 185 miles per hour. the strongest hurricane since 2007. by the way, there is another doozy behind that. we'll get into that one in a second. fox news meteorologist, adam klotz. adam. >> this is massive storm, neil. pushing closer and closer to caribbean islands. lesser antilles is up next. seeing hurricane watches and

warnings across the caribbean. talking about wind now at 180 miles an hour. still a western movement of the storm. defined eye. working 14 miles-an-hour. will take a couple days to work across the caribbean. this is powerful one. hurricane irma, wind running up to 180 miles an hour. this is the strongest storm in the atlantic with very strong wind since 2005. the very strongest ever were winds up to 190 miles an hour. we're not far off of that. this is powerful storm. as a result, you're beginning to see all the watches and warnings being issued across the caribbean. there is puerto rico, san juan, under hurricane warning. the path should run right to the north of island as this powerful storm gets on the move. category 5, we think it runs over some of this land it falls back dunn to category 4 storm, taking up moisture and fuel. cuts it off when you run over --

pay attention to time stamps. fried mornings, friday evening, lifting up closer to the coast of florida. the steering for this system, we get to this point, wonder what happens next? for the time-being all indication as deep trough grabs it moves it up florida, up the east coast, into the east coast, carolinas that. still a long way off until exact details. nonetheless, a major storm. it is heading in that direction, neil. neil: another route it could go into the gulf, after harvey, that could be problematic. >> this motion is moving in. about that trough. if the wind grabs it, move it up to the east, middle of the country. if it doesn't grab it it, could shoot up to the gulf. nothing stopping it. neil: no land mass would derail it. >> it is all up to the wind, upper level wind.

neil: thank you, buddy. hurricane irma expected to reach florida, based on its projection, sometime saturday. there is another storm in the atlantic, jose. the guy who saw it all coming, weather 2,000 chief meteorologist michael slacter. is this especially busy hurricane season? the 10th or 11th named storm? >> jose is 11th named storm. we had other prospects. this is the most active month in the hurricane season. we're not done yet, unfortunately. neil: the catalyst seems to be warmer waters, right? >> what is interesting to add on to the factoid, irma is the strongest hurricane ever in the atlantic outside of the caribbean sea or gulf of mexico. the four or five storms stronger in history occurred in the caribbean sea or the gulf. this is north of the caribbean sea, strongest hurricane ever. it will go this eyewall

replacement cycles. separate from land, separate from sheer, difficult for hurricanes to stay above 170 mile-an-hour over long period of time. it will wane next few days but think about it -- neil: what will make it wane? it reforms? >> runs out of own fuel. it has to rebuild itself at a very high-intensity. just to protect people from hyped up headlines, say you hear the headline it drops 50 miles an hour. that is still 130 mile-an-hour category 4 hurricane. we have to be wary. neil: what would prompt it to the slow down to that degree? if not land, nature of the beast? >> eyewall replacement cycles, ebbs and flows. it doesn't mean it can't get right back up to high category 5, category 4 again. chapter one, next two or three days i think it will wane a little bit before it gets towards the bahamas and florida. neil: a lot of people are

talking about its speed. a lot faster than harvey was. it could be a mixed blessing, doesn't leave type of rain and flooding harvey did but explain. >> it has a lot of inertia with it, because it is so strong, it has outflow, that creates a subsiding rich to the north. one of the reasons five days ago, computer models out to sea and further up new england and goes further west. people need to be wary, southern florida, not to think it will make the clip. as it moves with a full head of steam like a bowling ball with the substantive ridge to its north, southern florida has to keep sharp eyes. neil: when you say sharp eyes, it will be severe no matter what? no possibility it could boomerang or turn around and turn tail to go out back in the open atlantic. >> it is not a dot, it is a disk. no matter what scenario i see, curving in the bahamas, going to

the keys, curving into the gulf. no way a part of dick of irma doesn't lash southern coast of florida very hard. florida has big population cities right on the water. it doesn't need rain or lake okeechobee to flood to cause issues. just the winds, hitting these very high population cities from the keys all the way to let's say west palm beach or fort lauderdale. it could be bad news for, for the state. neil: it would hit the coastline, then presumably move up the coastline, rather than, i think in sandy's case, hop over into the gulf or what have you? what would be scenario likely? >> due to the inertia -- neil: like katrina i meant. >> it could enter the gulf of mexico technically. i don't see too many scenarios would allow it to curve not before the state of florida. so maybe a tallahassee or pensacola serve. i think western gulf is safe, according to my analysis now. but no matter what kind of curve

it takes, western coast of florida, eastern coast of florida, southern florida and bahamas are pretty much in for some bad news right now. neil: back it your premise of a busy hurricane season, this is busiest early on in a dozen years, right? what prompts that? is that cyclical in nature? what? >> we have obviously some very, very warm ocean temperatures. prior to harvey, 2005, 12 years ago, was the last time we saw a category 3 landfalls and all this activity. there are some cycles but there obviously is a long-term trend of oceans warming. that not only means storms get stronger, as they approach land they can maintain or even strengthen as we saw with harvey. i'm hoping not the case with southern florida. if this goes through a cycle and regenerates in the straits of florida, it could be very, very dangerous. neil: thank you very much, michael. governor rick scott of florida already called a state of emergency affecting all 67

counties in the state of florida no call for voluntary or enforced evacuations for the time-being. we'll keep you focused on that. gas prices down today after big run-up last week, are up 27 cents in a week. so effect is what you might imagine it would be, on notion of any disruption to the economy. forget about just the gas supply. meanwhile north korea is fighting fire with fire almost literally. promising more gift packages to the united states if it does anything. trying to counterseems to be another nuclear test in the offing days away. we're on it after this. ♪

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neil: all right. i do want to take a peek at the dow, down more than 204 points. a lot has to do with north korea and growing skiddishness that things are getting a lot more iffy there. japan concerned about 60,000 citizens presently in south korea, bringing them all back. as soon as markets hear that sort of thing, they sell first, ask questions later. this would be a boon to defense, defense related stocks, not across the board. they are the ones holding up the best with exception of united technologies. it is paying north of $30 billion to get rockwell

collins, the aircraft parts maker. that is deemed to be exorbitant price obviously. nasdaq is down as well. technology stocks with a big run are giving back a little bit. ahead of a hurricane and this hatest irma getting all the attention. walmart is is a big beneficiary. a member of the dow. looking up about 85 cents. home depot up. lowe's up, not members of the dow. this is typical what you see ahead of a storm. those stocks bid up a lot of demand for goods at their stores are bid up. then it sort of dials back after the calamity and storm passes. not all the time. most of the time. that is kind of a rule of thumb. people getting nervous about north korea. a good many places bets in things like bonds and passive invests that stand the test of time. if you're worried about the world falling apart, you want safety of american fixed income investment like treasury bond and notes.

all of which are up. that has yields down here. again, following to script here. not talking about it crassly. realistically this is kind of thing that happens at times like these. how long it lasts? depend how this plays out first and foremost in north korea, doesn't it? retire army colonel daniel davis. good to have you back. >> thank you, neil. neil: what is the sense what we do? we're dealing with all the options on the table. people are used to hearing that. the earth issue north korea is this close to capability, the other sinister folks, unreliable like pakistan, have this capability. we grimace and live wit. maybe a lesser extent with india as well. are we staring at that possibility, living with north korea. having that technology? >> well the situation with north korea right now, is that they already have the nuclear capability.

there is nothing we can do to turn that clock back. it is very valid concern, about what other regimes may want to do in the future. i think it is important that we not exacerbate this. we don't do anything that turns it into a hot war. with military action which could spawn a nuclear exchange we want to avoid. neil: what would do that though, colonel? i'm wondering you know, provocation is the eye of the beholder. north korea leading with provocative acts, president trump tweeting, i quote, i'm allowing japan and south korea to buy advanced amount of highly sophisticated equipment from the united states. the north koreans see that, chinese see that, they say you're taking this to far. i think having powerful and credible deterrent is absolute way to go. any so-called preemptive war, preventative war is definitely wrong way to two. that being said it is important

to have credible deterrent. if kim jong-un has weapons against any united states forces or any allies. need to know, that he will receive a very heavy dose of american firepower in return. but, also part of deterrent is to make sure that they understand if they don't use the weapons, they don't have anything to be concerned about, as we did with china in the 1960s, when they first went nuclear. during the soviet union during the cold war. neil: colonel, the latest wrinkle, china, anyone who trades with north korea, we stop trading with period, china among them. obviously there is big rep -- repercussion here but president trump is saying we would absorb the economic hit, sending a message to china, its cooperation, support for north korea woo be tolerate.

what do you think of that. >> that china has veto power over north korea and they will do whatever they are told. china is going through real heart ache with north korea. kim jong-un fired off missiles, this test, or fire off missiles in the preparation for the 19th party congress. president xi does not want any distractions here. it makes him look impotent and powerless. what we should do, continue to keep the pressure on. work cooperatively with china and russia, to the extent we can. we want to keep our trade relations open. we want to keep business flowing. we want to keep war from happening. neil: you mentioned that meeting. president xi xinping of china was there with vladmir putin of russia. right ahead of his remarks, xi xinpings, we have the latest missile test. or this atomic weapons test. >> right. neil: and that raises eyebrows, maybe there is something to the notion that china can't control

the north koreans. they more or less created frankenstein and he has run amok. what do you make of that? >> i do. there was article in the global times, semiofficial chinese english language newspapers and they were making that same comment. they were saying we don't have complete control. they eschewed a veiled warning to north korea, if they aren't careful they may find themselves in conflict with china. china is actually doing some things to send a signal to north korea. neil: like what? what could china do now? >> certainly, china hold as lot of energy stranglehold over north korea. if they wanted to, if they needed to. if they thought that would help, they could certainly squeeze that down tighter. appears un thinks he has upper hand and stick it to president trump and president xi. neil: that is interesting, that he has gone rogue.

is it your sense that it escalates, an accident, errant missile falls on land, rather than sea or blows up midair? these are types of things where all bets are off, right? >> i completely agree. one of the reasons we need it ratchet back incendiary talk like united nations with nikki haley yesterday. with secretary of defense. know it is important to send a strong message. we dent need to go too far. lock ourselves into action, flexibility if something happens. neil: thank you very. , colonel. a voice of reason. i appreciate that. >> my pleasure. neil: as i told you let's take a look at the dow again. these concerns more than any other if markets move. the asian markets are rattle by north korean test. our markets rattled during the labor day holiday. if the colonel is right, a lot

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neil: stocks are near in and out of session lows. a lot of this is obviously driven by north korea. a lot of it is looking at busy legislative agenda. counting today, when these guys are back, that is the house and senate back, they have only 12 such day this is month. that is not a lot of time to get a lot done. bush 43 presidential writer ned ryun. and -- i probably butchered that. i. will go to you first. your take on busy legislative agenda, whether it is doable. what do you think? >> i definitely don't think it is. unfortunately we've seen that

the trump administration has struggled with being effective legislatively in congress. his first promise was to repeal and replace obamacare. as we know that hasn't happened. with putting the talk at that issue in the hand of congress, it is adding another heavy, hard, difficult subject to their plate. neil: they have six months to work that out. >> that's right. neil: these days that is eternity. ned ryun, what do you think of that? everything has to be just so to get something done, particularly on tax cuts, which seems to be what the markets most want to see. >> what most of the american people want to see. look at state level poll, neil. look at ohio and wisconsin, almost 70% of people in tax reform. other states are well into the 70s. when you look prioritizing these issues, congress will have to be disciplined, this is dealing with harvey relief bill. they have to have a clean, stand alone harvey relief bill.

they have to move to tax reform. getting something done by end of the year. i'm thinking going up to the hill to hand out sticks of gum to members of congress, chew gum and walk at same time if you can't, please go home. neil: i see where you're going there. clicking off obvious things they have to do, they have to handle harvey and funding for harvey. the first tranche is now likely going to be north of $8 billion. it could ultimately be $10 billion, we don't know. they have to get progress on debt ceiling, raising that, this month, if not sooner. >> exactly. neil: i'm not doing this any particular order. they have to have a budget to fund the entire government. maybe, early prepare race and response for future hurricanes, which seems to be piling up. that would include funding for fema. and the like. busy docket. wondering whether it is all doable. how much democratic cooperation they are going to get? >> i think on a lot of these

issues, most persons, as my colleague on the other side cited do in fact want some sort of tax reform. the problem the trump administration really hasn't proposed any concrete plans. more like a list of goals. unless the trump administration has, solid tax advisors can come up with actual strategies that will accomplish -- neil: democrats be open for a cut in the corporate tax rate? >> that's right. neil: on individual rates, would they be open for something potentially leave out the very, very rich. you would like that, wouldn't you? >> the most important thing for the trump administration to do, getting democrats on board, making friend on the hill. neil: that is not what i asked? you would be open to that, those are the broad parameters of a deal, right? , right. >> but, neil, i could really quick insert myself, he laid out broad parameters. democrats want the corporate tax lowered. i would argue 15%.

settle for 20%. repatriateing 2.6 trillion overseas. a lot goes back to american workers and american businesses. aim tax cuts at middle class and small businesses f we get that accomplished. makes me nervous when republicans want to go for sweeping comprehensive, keep it simple, stupid. neil: they might want to make it simple. 4:00 p.m. today -- >> thank you for having me. neil: good being had. mitch mcconnell will be there. the first meeting obviously involving mitch mcconnell since tweeting dust-up. paul ryan, steve mnuchin, treasury secretary, gary cohn of the national economic council. orrin hatch as role of head of finance committee in the senate. kevin brady. so-called "gang of six," instrumental putting this together. tomorrow the president meets with chuck schumer and nancy pelosi. we'll see how that goes. typically a problematic month for stocks. october gets scary headlines but

september is deemed most difficult month for stocks last century. jonathan hoenig covered every year since that century. looks so young but not so. jonathan, what do you make this september plays out? a lot depend getting a lot of this stuff done? >> neil. a lot of money invested over the last year. the market is up 10 and 20% over last year, depending what index you look at. a lot of money invested contingent certain things happening, particularly in washington, tax cuts among them. kind of a market approach, what historically is weakest element, weakest month of the year, you're seeing weakness in stocks. i'm a bull. i think you have to be very reluctant bull. only 250 new 52 week highs. that is half of what it was six months ago. the bull market is on. i think a much weaker or narrow bull as it was i side a few

weeks ago. neil: jonathan, how much do outside events play into your thinking? the reason i mentioned, another big storm, irma, barreling down on florida, category 5, we don't know. it may be a busiest yet hurricane season. that goes through beginning of november. i know these are considered out side maybe black swan events but they're significant. especially if each one is significant. how does that play into your thinking? >> neil, the hurricanes and recent hurricanes really demonstrate efficacy of modern financial markets. even 30, 40, billion dollars estimated damage, hurts some insurance stocks but didn't create systemic damage that caused entire market to crash. potentially could do that, or flare up systemic risk we're seeing in north korea. this sun charted territory, neil. this is president in essentially is in an uncharted job for him.

a lot of investors faced with the question, they're running for safe haven plays. gold at 52 week high, as a lot of stocks are struggling. that means people are running scared. neil: that is interesting, because the markets shrugged off north korea. with every bit of sabre-rattling or every test. the game-changer was the hydrogen weapons test, showing they're much further along, north korea, than anyone thought or predicted. all bets are off now. it is frightened a lot of people? >> i mean, neil. this is a new level of escalation. as i think one of the trump officials mentioned. north korea essentially seems to be begging for war. begging for a response. this comes at a time, historically safe, quiet stocks, quiet era for stocks. there is only one 3% draw down the entire year. essentially the least volatile market since 198. all these factors.

fall, weakest season coming up, neil, unfortunately could be harbinger of weaker days to come. neil: the scariest thing to me, jonathan, this whole north korean story the prospect that china can't control them. if that is true, all bets really are off. if china is acknowledging, being embarrassed on the global stage here, and unable to control this nutcase, man, that is a whole another story. >> neil, it creates that systemic risk, investors say, risk off. doesn't even matter what fundamentals are. we're starting to see a lot of companies pretty well. alcoa, 52-week high. you get something like north korea, get an attack, it is systemic rick, katy-bar-the-door, all bets are off. neil: jonathan, thank you. we're trying to put it in perspective in middle after

selloff, down about 240 points. the latest culprits are those anything to do with thriving commerce, that could grind to a halt. bond are safe investment. gold is safe investment. exactly places to go if you get nervous. that is reality for time being, that markets are nervous. the latest from houston on hurricane harvey. the floodwaters are still there. the problems are still there. costs are still mounting, even with irma on the way. this one left town, and built a series of headaches with it. ♪ allergies? stuffy nose? can't sleep? take that. a breathe right nasal strip instantly opens your nose up to 38% more than allergy medicine alone. shut your mouth and say goodnight, mouthbreathers. breathe right. looking for adventure this labor day? holy smokes. oh man, that's pretty intense. look no further than chevrolet.

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neil: quick look at the dow in and out of session lows. my buddy gary kaltbaum follows markets and look what is is going on around right with him. he is in orlando. some stores already out of water.

lines at stores, born out by reports from the orlando is sentinel, there are shortages of supplies at grocery stores. people are buying up and hoarding goods is on. that could explain why the likes of home depot and walmart, two prominent retail components up on the day. home improvement stocks are ones that benefit. i believe i said home depot is not a member of the dow. it is. lowe's is not, that is what i meant. walmart suffice to say, following behavior, a lot of buying, rush of buying goods ahead of a storm buying. dissipates after that. these issues haven't had much time to breathe since hurricane harvey. cleanup efforts there in that texas, louisiana region continue. at least one neighborhood still food, in middle of it all. in houston. hey, jeff.

reporter: it's a big neighborhood. the barker reservoir is two, 300 yards up the street from where we are. it is coming down the bayou as they continue to release water but these neighborhoods may be down a foot, foot 1/2. i'm as far as i can go with my chest waders. you can go over your head if you go back here. this entire place is flooded. here is the other headline. talk about impacts, maybe not a big hit on insurance folks, i mean obviously will be a hit but many of these people, because this never flooded before, don't have flood insurance. so, it is not insurance companies will take the hit. you can imagine if you live in one of these houses over here, something will have to happen. you will have to you know, somebody will have to come through. you can imagine who that bill be. it is just amazing. so i leave you with this picture. floodwaters not gone.

just hope the hurricane doesn't come here. wouldn't that be something? neil: can you imagine, the outer rim of it would hit the area again, man, oh, man. reporter: exactly. more water. neil: outstanding job as always. port arthur, texas the entire town was under water. i don't know how it is now but this fellow would know. the mayor of port arthur, eric freeman, thank you for taking the time. i know it is crazy. how are things now. >> the sun is shining. it is a beautiful day. a little humid. the sun is shining. we're almost to the recovery. we have little water left in a few other -- neil: i didn't mean to jump on you mayor. >> no worries. neil: power outage, warm, stick kirks houston related weather, if power is out, that can make things tough. how is it there on that front? >> yeah. interesting, after the storm, i think we had about 6,000 customers that were without electricity.

in my last report, my last briefing we're down to less than 900 customers. so they have been working, getting the grid back up. we're hopeful they fet rest of our customers back on line here shortly. neil: i was hearing about irma, i'm sure you're keeping one eye on that, mayor. even outside pass of this storm on your area, your city and town, that could do even more problem, right? >> yes, sir. you know, with irma, there is wind. with harvey, when it hit port arthur it was just gallons of water just poured all over our city, millions of gallons. it is different. it's a wind thing. then we're hoping that it doesn't come our way. neil: yeah. i can well imagine. mayor, we're told some port activity is back up. some refineries are back up. i don't have the exact number. 330 more barrels are back up. do you know anymore of that what is happening --

>> everyone pretty much scaled back operations in anticipation for the hurricane. but you know, they are slowly but surely getting back up. port arthur does almost 50% of the nation's jet fuel here in our city. it is important that we get everything back up and going. neil: how could any state, region, city, town like yours, mayor, ever prepare for something like this? a lot of people are looking, saying why weren't they more ready? i think this is biblical, once in a few generations event. i mean there is no way to safeguard against this. but i mean, have you learned anything about how to prepare ahead of something like this? >> yeah. you know, definitely, we, we're always looking to improve, especially when it comes to public safety. port arthur, we're a big bowl here. a lot of times worried about storm surge. it creates a wall that we're protected but also a double-edged sword, keeps all the water in case you get

30 inches of rain keeps it within the bowl too. we didn't have any man-made pump to p.m. the water out of this bowl. our systems did their best. just couldn't do it with all those inches of water. there are some things. we lost our whole entire neat. commercial garbage trucks. residential garbage trucks. we lost our entire fleet. we learned things in that realm. quite a few things. biggest thing, only one person lost their life during this tragedy. because of high water. he had a heart attack, ambulance couldn't get to him. we cleared all our missing persons reports. we put our hands and eyes on everyone. we're hopeful that number doesn't rise. we already knocked two times on everyone's door. we will go and make sure we do it a third and fourth time in

heavily-affected areas. neil: think advice for florida counterparts in terms of evasion wages or what? >> heed all the warnings. listen to elected officials. elected officials would most likely give you the most correct information, especially one thing we noticed happened. something that happened i noticed during the hurricane is hysteria was high. posting on social media, saying things that weren't true, causing heightened level of hysteria. please, if you, when things come about, coming to florida, we're praying it doesn't, make sure you're sharing correct information with your friend and neighbors. so you know, we keep the hysteria down. we move people where we need to move them in case of evacuation. neil: that is very, wise advice, mayor. everyone stay calm. it will be tough but you can get through this. thank you, mayor derrick

freeman. thank you very much. >> thank you. neil: update handy to floridians ready to embrace for a big storm. governor rick scott called emergency for all 67 counties in the state. no doubt bringing national guardsmen just in case. he is hoping he is overstating the case but fears he is not. more after this. can i get some help. watch his head. ♪ i'm so happy. ♪ whatever they went through, they went through together. welcome guys. life well planned. see what a raymond james financial advisor can do for you.

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go long™. ♪ neil: you talk about irma, talk about puerto rico. right, right in the path of this monster storm, a category 5, declaring a state of emergency in puerto rico. that country's governor is on the phone or skype i believe. governor, thank you for taking the time. you had a chance to look at your country, how ready it is up for this. what do you think? >> well, we've, thank you for the opportunity, neil. since we took office public safety has been a critical component particularly some of these devastating events. so we started working on protocols for the past five months last week. i initiated the emergency protocols so we can have everything ready from food supplies to shelter, making sure

we identify those critical areas of flooding. so we've been starting to execute. mainly, today, neil, the critical component is the base of the nature and danger of irma, making sure we get people into safe shelters, protect lives, over infrastructure, which are really at this point, no telling how damaging could be. neil: at the u.s. commonwealth you can activate the national guard. how many guard men have been activated? >> we activated the whole national guard. i did so couple days ago. making sure we have the prep going. there are estimates how strong the storm is going to be. we always assumed the worst in the preparations. it served us right. right now we're talking about a 180 mile-an-hour hurricane, with

gusts at center going upward of 200 miles-an-hour. right now, it is scheduled to pass somewhere about 40 miles north of, northeast of puerto rico. but still, the wind would be very damaging and ravaging to puerto rico. those estimates just tilt a little bit so you wards, that means we're getting a, possibly the most damaging hurricane in the modern history of puerto rico passing through. we're ready for it. we have national guard ready for it. the federal government has been very supportive in the effort. just this morning to general kelly. the president's having, has an eye on this storm. spoke to secretary price as well, so that we can activate certain provisions for puerto rico. i actually solicited to the president a pre-landfall emergency declaration so we can get things moving to have the right resources before the storm.

neil: your people are right in the continental united states, people seeing this happen in florida, governor, they're getting their hands on as many cases of bottled water as they can, emergency foodstuffs that could survive a power outage lasting days if not weeks. are you seeing same thing in puerto rico? >> yes. we have, as part of the strategy was to alert people of the potential of this occurring about a week ago. people started stacking up. we made sure that we had provisions in the island, so we could supply at least for the next three to four weeks, we made that very clear. we have the data to support that. people have been going to the stores, getting their materials. but most importantly, right now, you know, we're in crunch time. we executed a lot of the efforts so that we could secure some infrastructure maybe, prevent some flooding. but right now, the effort steers

directly making sure there is mobility plan. that municipalities are executing properly. that we're moving those people that are vulnerable positions to the proper shelters. and that's why i'm moving across the island, just made a stop right here. but moving across the island, making sure everybody is aware of a great danger this threat might pose. that we're ready for it. that we can, we don't know what damage to infrastructure will be but we can save lives. neil: i know you have a lot of worries, a lot of concerns. we appreciate you taking the time. governor ricardo roseo in puerto rico. that commonwealth right in the direct path of this monster. irma a category 5 storm. governor, we wish you well and your fine people. protests in d.c. over the daca provision, deferred action for

children arrivals, almost a million people born to illegal immigrants, what to do about them. the administration kicked them off to congress to do something. to latino coalition, hector barreto, to you. what do you think of the president's approach. congress this is your job. come up with a solution. you have six months to do it? >> neil, we've been asking over a decade since i was in the bush administration. it is time for congress to figure out a solution to this issue. president trump didn't cause this pro problem. there is no more time. they can't hide from this any longer. neil: the issue seems to be to do with future illegal immigrants children, that these ones who are already here, no one will kick them out. is it your sense that that will be the case?

>> i hope so. look, everybody -- neil: what you do mean you hope so? that these ones who are here now, aren't deported. >> right. neil: okay. >> the president has said as much. the president said he is compassionate. they came here through no fault of their own. we all agree with that. they're making contributions. they're in school. they'reing. something needs to be done for the coheart which is 800,000 kids. the kids some of them don't know any country. i'm hoping going forward they can tackle the whole immigration issue. not just the dreamers we have an issue with. we have a system not working for americans and the economy and definitely not working for the security of our people. neil: the realistic probably result of all of this is that, these kids, they are not kids anymore, they are full-grown adults, they stay here. so i'm not sure what changes then.

would the proviso be in the future, whatever the house comes up with, congress comes up with prevents this happening with future generations? explain that to me. >> neil, it is already happening. seeing net decrease in migration to this country, from central america and yes, even mexico. less people are coming over here as it is. which is a good thing. we need to control our borders. we need an immigration system that makes sense. but for those 800,000 that are already here, i think something has to be done for them. i don't think it is tenable to be able to round up 800,000 people. that will destroy, not only households and economies. neil: okay. >> even folks in houston, who depend on workers are looking for the people who will be rebuilding that city.

neil: gotcha. >> many could be dreamers. neil. hector, jumping on you because i have to. >> thank you, neil. neil: north korea fallout right after this. urance company definitely doesn't have that... you can leave worry behind when liberty mutual insurance. you know how painful heartburn can be. for fast-acting, long-lasting relief, try doctor recommended gaviscon. it quickly neutralizes stomach acid .

. neil: all right, let's take a look at dow. a lot of this is north korea, plain and simple, the world is skittish and not much wiggle room for something untoward or an accident to make things worse especially ahead of talks that by thursday, a big public holiday in north korea, yet another missile launch, this one nuclear aimed, could happen, on the heels of what now appear to be indications

north korea has a hydrogen bomb or close to it. director of event studies harry cavallanas is with us. harry, it defies international outrage, including strong words from china which leads me to believe it's gone rogue, including china. is that true? >> they've been rogue for years to be honest with you. i'm concerned where this goes next. as you pointed out, the north koreans are all but certain to test another icbm. this test is very different. keep in mind, what the north koreans have been doing for the last two tests is loft of trajectory, taking a missile and firing it straight up in the air and going back down. the north koreans are not going to do that this time. they are in battlefield

conditions, fire it over japan and drop it into the mid pacific, because they need to know these missiles will work, you can't keep firing them up in the atmosphere and shooting it back down. that's the next place this is going to go and it would be extremely dangerous. neil: yeah, there is not much room for error there, what if it falls on japan? all bets are off. we're looking at a number of options ourselves, harry, including maybe providing tactical nuclear weapons to the south, south korean, north korea said that would be provocative as if everything north korea has done up until now is not. but that would be an escalation, right? >> the optics are good, reassure south korea, reassure japan as well. at the end of the day, neil, if the bottom line is if the north koreans launched a strike on u.s., seoul or our bases, we would wipe the north koreans out in 20 minutes.

>> surely they know, that harry, right? surely they know how suicidal what they're doing could be, but is it they don't care or don't think that we'll ever act that way or calling the president's bluff if they deem it to be that, what? >> their goal more than anything else is rational in one sense. what they support a deterrent to stop the united states from enacting regime change or something like that. that's the goal more than anything else. i don't think they want a war with the united states or a nuclear war, it would be suicide for kim jong-un. the goal is to deter us but the chances are of accidental confrontation, icbm dropping on japan, that's the danger here and that's where we're playing with fire. neil: vladimir putin said in this meeting he had over the weekend with xi jinping of china, that was the one the north koreans reveal the hydrogen bomb capability, but that our iraq war experience had led the north koreans to do

what they're doing now, essentially saying that north korea looked at the regime change that we forced, this is his opinion, and that the north koreans say not us, this isn't going to happen us to and this will be our way to protect against that happening to us. what do you make of that? >> i think that's actually very true, and actually if you look at statements that have come out of north korea, neil, they actually say. that kim jong-un, he might be crazy but he's a student of history. he's looked at iraq, afghanistan, yugoslavia, libya and know that the united states isn't going want to to take on a country that is nuclear weapons. they could clean house against another country that doesn't have them. that's spot on. neil: harry, thank you very much. new sanctions are something else we're considering, extending it to anyone who does business with north korea, that would include china, and that would change things the way we've gone about punishing north korea to the extend of

punishing those who do business with north korea. to retired navy captain chuck nash what he makes of all of that. what do you make, chuck? >> well, i think, if we're going to do that, if we're going to hammer down really hard on the chinese and the russians, the russians, eh, the chinese big problem, a huge trade deficit with china, major trading partner, but if you look at how do we get ourselves out of this, work ourselves out of this, it's going to take regime change or the removal of nuclear weapons, and they're not going to give up the nukes. so you're looking at regime change, the only people who can really do regime change and make it work without starting a major war the chinese. so here's the deal. the deal is what is going to cost more to the united states and our allies? a war that could turn nuclear, or putting really severe and self-hurting trade restrictions on china? something's got to get them to the table. pressure has to be on china because kim jong-un refuse to

have talks, he's sitting in the driver's seat and the little mouse is making the elephants jump up on the pedestals. neil: i'm wondering if the elements including china here can't control the little mouse and that changes the entire equation here if china is incapable of doing much that in effect created this monster and the monster is running the show? >> the chinese, i think, have far, far, far more intelligence about what's going on in north korea. and if kim jong-un were, to use the new jersey expression, wake up dead, who would come in behind him to replace him? i think the chinese probably have a succession plan in mind or some people who would be more likely to do that without pulling the nuclear trigger, if he should wind up waking up dead. neil: china would be the one to failstate that? >> exactly. not the united states, it can't be a western power, and china right now is kind of in trouble, here they are getting

ready to host this brick summit, and you've got their not their dennis the menace, this is an evil dennis the menace that is out of control and looks like they're driving china around. their prestige in the region is suffering and all of the hard work that they've done, much to our detriment to build out into the south china sea, all of that, they were getting away with that. now, the chinese, or the japanese, rather, are looking to modify their self-defense constitution which has been there since douglas macarthur et al. arranged that after world war ii and getting a hostile, not a hostile, power projection offense capability which they were purely defensive. if this happens, then china, through north korea is responsible for the remilitarization of japan. neil: quickly, captain, i was looking at the countries that have nuclear capability. of course, we have it, the

russians, france, the uk, israel, china, then you get to the countries that in recent years have not been exactly stable. pakistan even kazakhstan inheriting missiles from the breakdown of the former soviet union. iran protest that doesn't include them. india. but what would the world be like with north korea having that capability, joining that exclusive club, because it would seem to be even in a cast of characters that includes pakistan and india and potentially iran, the most unstable of them all? >> it would be a far more dangerous place. here's the thing, what they're talking about a thermonuclear device. now, it took india and pakistan about 20 years from their first test until they actually had a thermonuclear weapon. it took the french eight years, it took the north koreans ten,

and the north koreans are selling anything to anybody to get hard cash, and they're co developing all this stuff with the iranians. so it's not just what the north koreans are doing, it's the second order effect, second and third order effects of what they're doing, and our intelligence community got it wrong, again, got it wrong. how many times do we have to sit here and watch the chinese and the north koreans suddenly leap ahead? you know when we found out the indians had nuclear weapons? when they set off a test device. that's how he found out the pakistanis have it. now we're seeing this, they don't have the capability for two, three years, wrong. it is credible, a real threat. and having somebody like kim jong-un, having his finger on the trigger is not a good thing. neil: and knowing how much he needs money and can sell it to any world sort. that is scarier. captain, thank you very much, and i'm not tying the escalation of the sell-off to the good captain here but we have escalation in the sell-off. a lot of it in the market, just

to show you what's going on here. we have the dow down north of 250 points and a lot of it having to do this is escalating and not getting better and the options are not look more promising, including further alienating them financially, and then the flipside is the captain pointed out that to get some money, they have a big black market to sell this stuff, to sell this technology to all sorts of nefarious groups with no fingerprints on it. that is what causes scared markets to get more so. we'll have more after this.

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on home and auto insurance. call for a free quote today. liberty stands with you™ liberty mutual insurance. . neil: all right, 15 minutes away from a white house briefing, by the way. we'll take you there as soon as it begins, back to houston and the texas floodwaters not expected to recede until october, that's right, october. jeff flock in the middle of it all. >> this is where they're expected not to recede until october because of the reservoirs they continue to release water. we got word this morning from the water control folks that the army corps of engineers said they slowed the release of the reservoir.

the only way to get in, really, is by boat, and that's what we're doing right now, and maybe if dave spins all the way around, you can spin past me, maybe you see what's on the other side of this tree here. look at that car. isn't that something? wow. and the thought that this is not going to go down any time soon means these folks, we showed you last week people already getting back to it, and tearing stuff out and starting the redo. these guys can't get anywhere near it. the longer the water stays up, neil, the more damage gets done. it soaks up, wicks up the walls, it wicks into the rest of the structure, you may have to come in her with bulldozers before it's done if the water stays up for a long period of time. not a pretty scene. neil: incredible, jeff, thank you very much my friend.

>> something like daca, which is a controversial issue, whether or not that could delay president trump's agenda. take a look here at goldman sachs, down 3%. that has been shaving off more

than 45 dow points alone, travelers, the whole insurance industry has been under pressure. taking a look at jpmorgan and american express, also to the downside. taking a look at energy stocks which had hit their highs around lunchtime. don't forget, oil up, 48.67 a barrel. we are seeing commodities overall higher, gold also higher, and treasury bonds, we're watching the ten-year yields, the lowest since november. take a look at the insurers in florida, we're looking at those names today to the downside, names like universal insurance, hci group, down 17%, anything hurricane irma as well as on the heels of harvey, the whole group has been under pressure. back to you. neil: nicole petallides at the new york stock exchange, thank you very much. i want to bring you up to speed

on what's happening in washington. we're moments away from a white house briefing. the president meeting or will be shortly with his key economic team including steve mnuchin, gary cohn, his national economic council adviser, and that will include mitch mcconnell, of course, the first time they have talked to each other since, apparently, a cursing-out phone call some weeks back and the president's nasty tweets about mitch mcconnell not doing more to continue the legislative agenda that he says republicans should be winning, not losing. and later today key members of congress will be included in that not only mitch mcconnell, but paul ryan, orrin hatch, i guess in his role as head of the senate finance committee, kevin brady, tomorrow it will include nancy pelosi and chuck schumer as the president seeks bipartisan support on a tax matter. whether any of that is possible and the timing, charlie gasparino. what do you thinksome. >> the markets are saying it's

increasingly less possible. i still think net-net the trump agenda overall, less regulations, at least -- hopefully -- not a tax increase is net positive for the markets. so, you know, long term it's better than what hillary clinton was going to give you. but, you know, you look for reasons to sell off. why would you sell off today? one good reason is north korea, obviously. the markets hate the prospect of nuclear war. number two would be a stalled tax cut agenda, just adding more fuel to the fire not just global unrest, but here in the u.s. you don't get a sort of stimulus that you thought you'd get. now, does that mean the markets will stay sold off? again, i am telling you less regulation is generally really good for the bottom line -- neil: and every time they take a hit like this, significant though it may be, they have a habit of rebounding. >> even slowly. neil: right. >> because like long term the impact to the bottom line for less regulations is pretty substantial. and stocks generally are correlated to corporate

earnings. neil: i think a lot of this is north korea, don't you? the concern that we could all blow up, or it could be an excuse to sell. >> i think it's an excuse. it's all, it's basically headlines. i think that if you don't cut taxes, you're going to get a selloff. i don't think it'll be cataclysmic -- neil: what if it's next year? >> then you keep putting off the inevitable. the other sort of problem trump has is that markets are losing confidence in him as a leader. and this is going to engender a lot of hatred on twitter, but i'm going to say it -- neil: they hate you already. >> they do. i'm like cold water in the trump face. here's the bottom line. if you're the president of the united states and you cannot get your agenda through a republican congress, you are generally considered by investors to be a failure. they lose confidence in you. that's just the bottom line. neil: not all confidence yet. >> not total. it's starting. neil: but you think if he gets the tax cuts through, whatever they are, it might change

everything. >> it does -- neil: what if they're retroactive? i think that's less likely. >> i'd just get them through. when i hear gary cohn, nec, national economics chief -- neil: right. >> -- get up there, and i think he did it on stuart's show last week, and we played a clip of it on friday, he basically was talking about a tax increase for the rich. and here's the whole thing, you have to go into -- i mean, markets smell this out in a second. is this tax cut, is it designed to make things fair, is it designed just to get something through, or is there really a stimulative activity to it. is there -- are we really going to get enough of a corporate tax cut that that it adds to corporate earnings. are we going to get a big enough bang for the buck on the individual side -- neil: on the corporate side, what would be big enough? >> i think it has to go down to 20 and no more -- neil: i agree with that. >> if they cut out all the deductions, it's not that much different than what they have

now which is an effective 27% rate with deductions. neil: he might come out of the gate with 15 -- >> well, he should. neil: orrin hatch has said it's going to be 20-25 -- >> i'm just saying in the end -- neil: i agree. >> if you're going to raise taxes, that should have an impact. neil: we should explain, what gary cohn was talking about with stuart, we might cut the top rate a little bit, but it'll be offset by limiting their deductions, so the net result might be they end up paying more which i think would be a fox alert to some of these -- >> here's the thing you have to realize whether we like tax fairness or what, the upper 1% pays something liking 50% of all the taxes, correct? neil: 35%. 5% pay well over half. >> there you go. the upper -- >> neil: that's a lot, you're right. >> that's a lot. so if you're looking for what's going to stimulate the economy, giving a marginal tax cut to middle class people, and it depends on how you define them as middle class.

neil: they say guys like you would be in that 1% -- >> yes. neil: -- don't spend it, you safe it. >> what's wrong with that? neil: i'm not here to judge, i'm just saying that's the argument -- >> we don't put it in the bank anymore. we save it, we invest it. when you invest that money -- neil: you invest in italian -- >> olive oil futures. [laughter] neil: that's the argument. >> but they don't understand. neil: when you start picking and choosing, what i worry about is that we've changed the so so-called imaginary line on this. used to be kicked around 35%, 39.6, but if we bring it to 38, 37, we've already changed the floor, and it can only go up. >> right. and that's such a stupid economic argument. if you know anything about economics, one of the components of gdp is investment. neil: right. >> right? i mean, who would -- neil: you're just bummed out you're not getting a tax cut. >> i think it's stupid, because i've already bought my maserati -- [laughter] you know? neil: but what are the odds, you think? the guys you talk to about

factoring in odds of a tax cut, 12 legislative days the house and senate are working together -- >> listen, if they don't raise taxes on the upper income and they do a substantial tax cut for corporations, that's going to be really positive for the markets. and i think we would be celebrating. neil: all right, buddy, it's good to see you back. >> missed you. by the way, love your pumpkin spice latte colored tie. neil: i've got so much to tell you on that. i was so ahead of this curve -- >> is it x-rated? neil: no, it's not. [laughter] i want to bring up-to-date on irma, officials in the florida keys are preparing for the worst, hoping for the best as the governor there, rick scott, has already declared an emergency for all 67 counties. but monroe county spokesperson kelly clark is quoted on the wires as saying a mandatory evacuation has already begun for tourist, and it has to ensue by sunrise wednesday. an evacuation plan for residents

also underway. but the timetable is yet to be determined. that as there is a raid on anything like bottled water throughout the state even in places like orlando. an orlando resident telling me it's already begun, after this. ♪ it's a highly contagious disease that can be really serious... especially for my precious new grandchild. it's whooping cough. every family member, including those around new babies, should talk to their doctor

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going to be one of the longest recovery efforts that the salvation army has been involved in, and i noticed this morning's report yesterday, we served over 56,000 meals. we're deployed all the way from corpus christi to beaumont, and over 80 mobile kitchens there out there. serving people and as people get back into their homes, they need somebody to come by with some water and a hot meal and that's what the salvation army is doing right now. neil: do your funding donations go up just to keep track of all the money you're spending to make all of this stuff happen? or do you worry about it later and hope that does happen? >> well, we're always very conscious of the fact that we're spending several million dollars a week just to respond to this disaster, to harvey, and the money's been coming in very well, but we noticed yesterday as news of irma came along, the online donitions

dropped significantly, and so that's a matter of concern, when the disaster is no longer the lead story, then people don't open up their pocketbooks. and there is still tremendous need, not just in texas, but there's tremendous -- there are going to be tremendous needs in florida, starting next week. >> i was thinking ahead of your coming and appreciate you taking the time. we may not be prepared for what may be a record breaker season for hurricanes, in the sheer number, of course, hurricane jose apparently behind irma, another one that will be duly named and soon announced. the busyness will obviously keep you busy, right? >> well, our teams are certainly preparing. one of the interesting things is that some of our best trained disaster workers, of course, are in florida. they were deployed to texas

today. we've had to redeploy them back home to make sure that florida is ready, that the salvation army in florida is ready to respond to what could be a disaster even larger than harvey, and harvey is the largest one we've ever responded to. neil: yeah, a lot of them oftentimes depend how long they hang around. harvey hung around for a long time. >> that was the situation with harvey, it stayed and dumped 50" of rain. but when you're looking at 150, 175-mile-an-hour winds that are going up either the east coast or the west coast or straight up the middle of florida, you're talking about millions of people who are going to be impacted. estimates we're getting now is that there's a possibility of over 300,000 people in shelters in the state of florida in the next week. neil: all right, ron, colonel, thank you very much. >> thank you, god bless you. neil: in the meantime, lot of people are looking at flood

insurance, but the actual number of applicants is down 10% from 2012, not quite sure why that is, but wayne peacock is the usaa executive vice president on what is going on. a lot of this is pre-harvey, what was going on? >> neil, thanks for having us today. our hearts go out to all of those impacted by hurricane harvey and a special thanks to our first responders, national guardsmen and citizens helping citizens across the path of this storm. great to see the texas spirit alive and well in the very extraordinary times. as we look over the last few years, yes, the ownership and flood insurance policies has continued to decline, it's one of the things we work on a lot here at usaa, convincing members if you're in the flood zone or close by, spend the time with one of our advisers or claims personnel to talk

about whether you should have flood insurance for your property. >> i would think people, especially those with mortgages, their bank or lender would require it, as a given, if you're in a flood zone. that's the case for floridians who are in harm's way. >> if you're in a high-risk flood area, that is the case. across houston today, only one in six of those homes have flood insurance. neil: why is that? that is an area prone to floods. so why didn't more get it? i can understand the expense, but a lot of the lenders would demand it, wouldn't they? >> they would in the high-risk areas xerox an opportunity to think about where the flood maps are drawn and where the high-risk areas are, that's a nagging problem over the last few years with the flood program. neil: what is your sense of people who heard about the story, the huftonians who didn't have coverage or did but didn't cover them nearly to the degree they thought and said the hell with it, we're not

getting flood insurance, it's not worth the paper it's printed on. what do you think? >> simple math, neil, flood policy is going to cover up to $250,000 worth of coverage for your home and potentially another $100,000 for belongings in your home, and fema grants are nowhere near that amount so we believe in you're in one of those zones and concerned, you're going to be in much better shape with a policy than counting on the federal government to come back after the fact. neil: i would imagine the cost of the policies has gone up a lot since harvey? >> time will tell. you know, the flood program actually expires at the end of september, and there's a lot of discussion and opportunity for us to think about how to modernize that program as we move forward, especially with the learnings of harvey over the last week. neil: what happens to the people who have damage in excess of the 250,000, allowing for the extra 100,000 damage in excess of that. maybe they're considered to be

so few that it's not an accurate gauge. what happens to them thinking they had coverage and turns out not nearly enough? >> you're going to be able to exhaust the coverage you have and see how fema steps up and other government incentives, other government programs step up after harvey to help. but for many of the folks impacted, it's going to come out of their personal accounts to be able to close that gap. neil: in the meantime, a lot of insurance, insurance related stocks are hit hard, they're getting hit hard in light of irma barreling down the pike here. is your group financially up to the storm? >> well, usaa prides itself in preparing itself both financially and operationally. we are prepared and ready to weather the storm on both fronts and obviously keep monitoring this as the days and weeks go by. neil: wayne, thank you very much. wayne peacock, a usaa executive vice president, on the quest

for coverage and those finding out after the fact they didn't prepare enough. what's at stake in florida and the other locales, we'll get another gauge in the days ahead. stocks down a lot. a lot of concerns over north korea. a lot. we'll spell it all out ahead of a white house briefing minutes away. after this.

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. >> congress should carefully and thoughtfully pursue the types of reforms that are right for the american people. our nation is comprised of good and decent people who want their government's leaders to fulfill their promises and advance an immigration policy that serves the national interest. neil: all right, that was attorney general jeff sessions earlier today saying the dreamer program as it's called, the deferred action for childhood arrivals or daca extending for six months, congress can come up with a solution, in other words, punting this back to congress to do what it should have been, the administration says in the first place, and not allow president obama to come up with the executive order that shielded the 800,000 to a million young men and women because they came with parents illegally to suffer the consequences. center for immigration studies executive director on all of that.

mark, where downing all of this is going, let's say six months from now? >> good question and it's up to congress which is where it should have been in the first place. the question whether daca is advisable is separate from the question of whether people who came here as young children and have grown up here as americans should get amnesty or not two. separate questions. daca is simply illegal. president obama himself, the year before he issued it, acknowledged that what would become daca was not an appropriate use of his power for political expediency he changed his mind. this frankly is letting the dacas down easy, the six month grace period before anything happens and then it would be two more years if congress does nothing where people, where people's work permits expire. last daca would not lose work permit for fully 2 1/2 years from now. that's plenty of a grace period for congress to get off the stick and do something.

neil: yah you would think, right? the issue is whether any of them, forget about losing work permits before or after that time, what about losing status as seen in the eyes of many americans and they would be deported? that seems extremely unlikely to me, what do you think? >> some will, if they get caught up with the law, could be deported. daca holders have already been deported because they're involved with gangs or slipped through the cracks through the vetting and got a daca work permit, but generally speaking, not as though homeland security is going to print out a list of addresses for i.c.e. to round up people who had daca. that's just a silly scare tactic, the administration itself said they're not interested in doing that, and that's just not the way i.c.e. operates. that's simply not going to happen. some will, in fact, end up being deported but won't be that many. not going to happen.

neil: you know, new york and washington state are two states suing over this. the president taking this decision. south carolina interestingly enough and attorney general said it will drop plans to sue over daca, over the president's decision. and i'm just wondering where those states, the two that are remaining that do look to sue on, what grounds? what would they be argueing? >> i no idea what they would be arguing, there is no legal grounds for a lawsuit. daca was not -- wasn't even executive order, it wasn't even a regulation which has a formal process in law of issuing it. neil: what was it? what did president obama do? >> it was a memo. that's all it was. dhs wrote a two- or three-page memo. it's online, the president has ever authority to kaenls the memo issued by a previous administration. this is not to say that they won't find some judge who

basically would make up whatever he wants and try to enjoin this. that's not impossible, but it would be one more indication of how lawless our judiciary has become. >> i think the media, i would say not fox, but have such a crazy reaction over something, everything gets the racist stamp everything approaching a crackdown or approaching the norm as was the case president obama issued this executive memorandum, whatever you call it. one commentator said the statue of liberty is crying today. really? doesn't that get in the way of solving this problem when we frame it that way? >> of course it does. this is a sympathetic group of illegal immigrants, this is a special case, not like any other illegal immigrants and their situation could have been fixed years ago if the people pushing the dream act, the legislative version of what became daca, had been willing

to -- to engage in a little give and take. in other words, say, okay, let's include a e-verify mandate. this is online system, helps businesses, make sure they hire people only who are legally here. the system exists but congress has to make it mandatory for it to be mandatory. the president can't do that. so people who wanted to push the dream act could have been able to say, look, let's join e-verify with the dream act and see if we can get enough people to push this through. no, it is all or nothing, our way or the highway and ended up with nothing, this is the consequence of a maximalist effort to get everything they want without any willingness to compromise or give anywhere else, and these young people, they're not children, despite what the politicians say, they're all in their 20s and 30s, but the young people are the one paying the price for

that. >> are again, you think six months will be enough time for congress to come up with something, i know the history of congress, under either one or both parties that time can pass quickly, if nothing gets done, do we revert to the law the way it was? >> exactly. what happens next months from now, the first people whose work permits expire. the dacas whose permits expire on march 6th, they would lose, it have you several hundred people each day have their work permits expire, and if they're working and some of them are working, they would have to leave their jobs or continue to work illegally. it will have an effect but it will be a process not just a one-day event. neil: understood, mark krishgorian, thank you. sarah huckabee sanders starting now. >> faced with the very real possibility of a potential and immediate shutdown of the entire daca program by a federal court. president trump took the

responsible and constitutional step of announcing that the administration will be phasing out the program over the next two years. today, september 5th deadline was set by the plaintiffs presenting the administration with two and only two real options to choose from. the likely sudden cancellation of the program by a judge, or an orderly winddown that preserves the rule of law and returns the question to the legislative branch where it belongs. the president chose the latter of the two options. the president made the best decision in light of the fact that the system set up by the obama administration in clear violation of federal law. president obama admitted this himself calling it a temporary stopgap measure and calling on congress to act. daca was initiated after congress explicitly rejected the same proposal in legislative form. in other words, president obama didn't just suspend federal law but implemented a policy congress explicitly rejected. there is a misconception that daca primarily serves as a

shield from deportation. this is misleading. daca grants work authorization to nearly 800,000 individuals who are not legally authorized to work. daca recipients whose average age in their 20s were not an enforcement priority before and certainly won't become a priority now. priorities remain the same. criminals, security threats and those who repeatedly violate our immigration law. the main effect of today's announcement is work permits and other government benefits are gradually phased out. rather than leave daca recipients and the men and women of immigration enforcement in confusing limbo while the daca program was challenged by states in the same court that struck down the previous administration's unlawful immigration orders earlier this year, president obama is laying out a responsible 24 month phaseout. sorry president trump. no permits will be expiring for another six months and permits remain active for up to two

full years. the president was elected partly to deliver meaningful immigration reform that puts the jobs, wages and security of the american people first. he is delivering on that promise every day and put forward serious proposals to congress that would responsibly enl illegal immigration, prevent visa overstays, remove dangerous criminals, protect american jobs and wages and create a merit-based system that grows our middle class. these are not just president trump's priorities, they are the american people's priorities. for decades now, the american people, immigrant and u.s. born, have asked congress to establish a lawful immigration system that protects our country. they've asked for strong, secure borders, asked us to protect american security and american jobs and they've asked us to have compassion, not only for those who are here illegally, but for unemployed american citizens including millions of unemployed african-american and hispanic citizens who continue it suffer under a broken system.

the president's daca decision brings us closer to safer, fairer and legal immigration system. now that he has ended this unsustainable and unconstitutional program imposed by the previous administration, the president is calling on the men and women in congress to fulfill their duty to the american people by truly reforming immigration system for the good of all people. and with that, i'll take your questions. john? >> reporter: sarah, one question that went unanswered today was some 359 members of the daca program enlisted in the u.s. army in 20%, tour the duty would run four years but daca status runs two years, if there's no fix by congress before march 5th, do you know what happened to the people? would they become ineligible to remain in the military or special dispennation? >> we have confidence that congress will step up to do

their job. this needs to be fixed legislatively. we stand ready, willing to work with them in order to accomplish responsible immigration reform. that would include daca as part of that process. >> many republicans believe, that getting something on republican side will not be easy with the divisions we see between center and right of the republican party can only deepen. what gives you confidence -- >> with all due respect i don't think the american people elected congress to do things that was easy. if they can't do it they need to get out of way let somebody else who can take on a heavy lift and get things accomplished. major? >> sarah, context of daca as piece of legislation, would the president be willing to sign only something that addresses that. would it have to have component of the raise act? would there be funding needed

for border wall? or simply sign something that simply addresses daca legislatively? >> the president wants to see responsible immigration reform. he wants that part of it. we can't take a one-piece fix. we have to do overall immigration reform and frankly lawful. that is what the president -- >> what would be priorities for comprehensive package? daca and something else? >> certainly to control the border. improve vetting and immigration security. enforce our laws and do things to protect american workers. >> reporter: let me ask you a question about north korea. in the president's mind is it option to simply contain north korea that possesses nuclear weapons? >> certainly the priority of the administration is to have denuclearization of the korean peninsula. it is also to protect american citizens. certainly the priority would be that.