kellyanne conway and jill stein pushing for recounts in three states. i'm chris wallace in for bill o'reilly. he'll be back monday. remember, the spin stops right here. breaking tonight, it was all out war, staffers from the trump and clinton campaigns clashed publicly and poignantly 24 hours ago. and it comes as we see new signs that the democratic party itself may be coming apart at the seams. welcome to "the kelly file." trump campaign manager kelly conway and jennifer palmieri were some of the participants in a forum last night where they traded vicious barbs. palmieri suggesting that the trump campaign was based on a

platform of white supremacy. when things were a bit more calm when conway appeared with robby mook a short time later, that didn't stop either one from continuing their attacks. >> i think there's a lot of things we need to exam coming out of this. congress has got to investigate what happened with russia. we cannot have foreign aggressors intervening with the electio election. >> i think the biggest piece of fake news in this election was that donald trump couldn't win. >> the federalist, david wall joins us in a moment. first to trace gallagher with m more. it got heated. >> they've all been civil until now. in fact the moderator at harvard kept reminding the dam pain this was meant to be a first draft of

history for generations to come. future generations will now how bitter this campaign was. one of the most contentious back and forth came when clinton communications director jen palmieri con deemed steve bannon for providing a platform for white supremacy. >> you think i ran a campaign where white supremacists had a platfo platform? >> you did. >> do you think this woman who has nothing no common with anybody -- >> yes. >> over 200 counties that president obama won and donald trump just won. do you think that's because of what you said or people aren't ready for a woman president. how about it's hillary clinton. she doesn't connect with people. how about you have no economic message. >> did you hear you guys are pathetic in the background? clinton campaign manager robby

mook said there were miscalculations in the come pain saying younger ve eer voters di turn out enough but mook pointed fingers at james comey for reviving the e-mail controversy at the 11th hour. and things got heated again when benson reminded the trump team that his candidate won the popular vote. watch. >> don't act as if you have some popular mandate for your message. the fact of the matter is more americans voted for hillary clinton than donald trump. >> and there was nothing that said the road to popular vote. it's the road to 270. >> i premised my statement by saying that. >> hey guys, we won't. y you don't have to respond. >> he talked about hillary clinton being truthful and forth right and both of the campaigns said the media wasn't fair to either one of them. >> well, we'll leave that to be

debated further. trace, thank you very much. as if the sore loser syndrome wasn't enough, we're seeing more and more signs that the future of the democratic party itself may be in trouble. senior editor molly hemingway, david wall and julie roginsky going us now. good to see you on this fine friday evening. to that point i want to play a little something that congressman emanuel cleaver had to say. this is coming from a democrat and then i'll have your response. >> at the present time i got to say we had no strategy, we have no plan. but at least we have some proven leadership that can you know take us into what's going to be a new era. >> julie, okay. no strategy, no plan. he does say proven leadership. they did reflect nancy polocy. a lot of people, including

democrats rolled their eyes saying that just means they didn't get what happened in the election. >> on the one hand congressman cleaver saying we don't have a plan or a strategy. he may be right about that. if that's true, that makes me incredibly fearful. but then he's saying we have to stick with the people that don't have a plan or a strategy. if you don't have a plan or a strategy, got to change the general on the field. and nancy pelosi served for a long time with distinction. if he can't get it done, hasn't been able to get it done in several cycles, it might have been time to look in a different direction. i would urge hem to take a look and see if the person that can't great you over the finish line time after time is the person leading you might want to find a new leader. >> it wasn't just a few votes here and there. there were dozens of votes that didn't go to nancy pelosi. david, this thing has gotten

really ugly. we heard the back and forth from that conference, that forum that happened yesterday. there's been a lot of talk supr. what was leveraged in a way to get people to the polls to vote for trump. what is your response? >> you know kellyanne conway. if something like that had been going on, she would have left the campaign in one second. to spew that kind of toxic venom was disgraceful. do you know how many times i tried to get to a court hearing in l.a. and couldn't get there on time because roads and streets were closed because president obama or hillary clinton or some other democrat was hobnobbing with celebrities and movie stars and at the same time mr. trump was in ie has, indiana, ohio, hobnobbing with the people that counted. it was strategy and bannon is a great strategist, great guy.

i met him at trump tower. not one shred of racism in his bones. think don't get it. they didn't have a plan, they didn't have a platform or ideas. they lost and they're reeling. to spew that venom at kellyanne conway who is an absolute graceful pen who handled it well. i wouldn't have been surprised if she stood up and slapped that woman for saying that. >> we're not advocating physical violence here. but molly, i got to think, if kellyanne conway was on the left, i'd be seeing her on the cover of vogue. this is a mother of four who ran an upset presidential campaign. but the left is not big fans. >> it's really amazing. she's done this historic fete of being the first female to win a historic presidential campaign. she handled sort of all comers

very well and it really is interesting. this whole -- ever since the election was over we've been talking about how is it possible that hillary clinton lost. i think really people are starting to realize the question is more about what are the things that the trump campaign did so well. that harvard forum mixed in with the blame game and the conspiracy theorizing that you heard from the clinton people, we heard a lot of the smart things that the trump campaign did. they had innovative approaches to advertising, relying less hand television advertising, more on digital campaign advertising because they were able to get their message out. i mean they were really doing some interesting things that go completely against the nair tiff that they were a mess of a campaign and the clinton campaign was a well-oiled operation. three weeks out from this victory for trump, you would expect the democrats to come to terms with it and start learning

some lessons. they don't show signs that they're learning. >> what do you make of that. there are people, when they heard that back and forth from last night, said this is exactly why trump won. they don't get it. they think it's leveraging of the extreme alt-right. you can't win an entire election on that alone. do you think democrats are doing any soul searching, like the republicans are? are the democrats going to take some lessons there. >> first and foremost were the autopsy of the completely out of the window. secondly, look, i spoke at great length today to one of the people on the panel on the democratic side who told me and i've read in reports as well, it doesn't -- the head lines they're talking about the racist

allegations and other things. they took a lot of ownership of things they could have done better, including reaching out to working class white voters, focusing on other states that they didn't focus on. i think there was a lot of responsibility taken. i know the media loves to sensationalize the allegations. but i've known kellyanne conway an awful long time. she's lovely and i like her a great deal. but steve bannon ran a website that he said himself was the leader of the alt-right. to me the alt-right is not the alt-right. that's another word for neo-nazi. >> please. come on. >> you're saying he's not racist. breitbart had a section entitled black crime, not crime in general but just black crime. that's racist. >> steve bannon has rebutted saying he's not part of this. he's been mischaracterized. i want to let you address this.

you know bannon. >> i was good friends with andrew breitbart before he passed away. i've met all kinds of people that work there. not one shred of racism among any one of them. remember, trump's son-in-law is jewish, his daughter is jewish. he's going to hire a white supremacist to work on his campaign? it's garbage. early on in the campaign donald trump made this clear. he was going to be an inclusive president of the united states. the nonmainstream media ignored it. he's inclusive and he believes in diversity. >> were you reassured at all by the comments he said last night where we're going to be inclusive, i'm denouncing anything other than that, anything that is racist or extreme and that's not part of what i want to do. did that reassure you at all last night? >> i would love for donald trump

to do. when he was asked specifically about that march that took place or that rally that took place just mere feet away from the white house of neo-nazis doing the nazi salute, he said i disavow. but he never said what he specifically disavowed. >> what about what he said last night that was very specific. >> he specifically said i want to be inclusive and then he followed that up with we beat hillary clinton and everybody started chanting "lock her up". >> that's not racist. >> you're talking about inclusive. as long as -- this is not directed at andrew breitbart. this is directed to steve ban n bannon. as long as he ran a website that had black crime on it, that's the definition of racism. >> donald trump in his remarks last night made a very clear statement and hopefully for many people that will lead us to the next step. he is going to be the president. thank you all for you time. less than 24 hours after it was announced that one of the most distinguished generals of our time is nominated to be

secretary of defense, some democrats are suggesting they may block him. we'll get reaction to that from a member of the trump transition team coming up. plus with president-elect trump's carrier deal on the way and jobs numbers out today, new questions on what the trump white house economy will look like and how the media is already spinning the success that the president-elect may have. chris stirewalt and rick lowrie are here on that. plus school classics band from a school near you. that report coming up. >> i was a little disappointed that we would go that far and it scares me, how liberty mutual stood with me when i was too busy with the kids to get a repair estimate. liberty did what? yeah, with liberty mutual all i needed to do to get an estimate was snap a photo of the damage and voila! voila!

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developing tonight, some 24 hours after president-elect donald trump announced his swengs intention to name a celebrated four star general as his secretary of dejenfense, genera mattis is getting some pushback. chairman of the house intel committee. but we begin with trace gallagher reporting from our west coast news room. >> marines under general matt

mattis's started calling his mad dog. from 2010 to 2013 mattis led the central command which oversees the middle east and southwest asia. during that time he was critical of the obama's administration disengagement policy in the middle east. mattis also butted heads with the current administration over husband hawkish stance on iran. but general mattis and president-elect trump have their own disagreements, not supporting trump's conciliatory statements toward russia. he also thinking ripping up the iran deal would hurt the u.s. he would be thement first general to become defense second fair since 1950. and mattis would need a special congressional waiver.

some democrats, including senator gill debrand would a oppose the manner sayi ining civilian control of our military is a mufundamental policy. in 2003 the general wrote about the importance of reading saying, quote by reading you learn through other's experience. generally a better way to do business, especially in our line of work where the consequences of incompetence are so final for young men. he's known for turning a compelling phrase, be po light, be professional but have a plan to kill everybody you meet. mattis finds himself defending allegations that as a brigadier general in 2001 he repeatedly refused to send helicopters to

rescue a group of green berets. the army captain who led said the general betrayed them. >> member of president-elect donald trump's transition team and chairman of the house intelligence committee. thank you for joining us. >> thank you. >> any surprise to you that general mattis, although it seems he has wide praise across the aisle and all up and down the ranks, inside and outside the military, there are detractors coming forward immediately with questions about his ability in. >> it's a little shocking. donald trump's transition team asked me shortly after the election who i thauought would the best secretary of defense. they asked to go out and recruit the very best people. and i said without a doubt that jim mattis would be the very best person. she has a broad cross section of

both republicans and democrats that support him and i think those that do not support him are probably just playing politics at this point. >> what do you make of democrat senator kirsten gill brand's suggestion that she's going to oppose him, this waiver he has to have and she may push for a 60-vote threshold which means that democrats would have to cross over, a handful of them as well in order to get him across the finish line. >> i would say it's rather pathetic because she has not heard general mattis testify before the senate. he should at least get that chance. we should have a debate in the senate in terms of whether or not he should get a waiver, just like we'll have in the house. my guess is this will overwhelmingly stop. in the senate wants to stop a four-star general, one of the most revered generals in modern history at a time that's very very difficult overseas, especially in the middle east,

and a man what's been right. he was right on iran, right on iraq, he was right on the problems we're going to face with al qaeda's growth in syria and he was right in withdrawing the troops from afghanistan would lead to problems. i hope that the senate sticks with the facts and donald trump asks us to go out and find the very best person for the job and that's what we did. and i think that donald trump made a very very wise decision in selecting general mattis to be the next secretary of defense. >> there are hot spots around the world, domestic issues as well within the pentagon that if he is confirmed he's going to have to deal with budgetary issues and dealing with isis. what is the most pressing concern. you know more than we do. >> well, just quickly, china, russia, the jihadist problem, iran and north korea that are trying to get nuclear weapons and other types of large scale

weapons, weapons of mass destruction. and then between all of that you have the cyber activity that all of those bad actors can use on and off. >> you're part of the trump transition team, one of his bold initiatives, there's been a lot of talk about overhauling the tax code. a lot of folks are giving him applause in what happened with carrier yesterday but say that getting to the tax code is much tougher and involved process. >> my advice to the trump team has been to focus on two issues at the highest level. one is the tax code because we need to reform the tax code in order to fix our economic problems. secondly focus on health care, let's reform, replace and repeal obamacare but make health care better for the american people. but specifically like you heard donald trump talk about last night in cincinnati, he talked about how the tax code was

unfair, how other countries are able to charge a tax and at the same time they're shipping stuff into our country without the tax while it puts or manufacturers, local mafr nufacturers at a disadvantage. i'm excited about donald trump trying to repair the tax code and i think it's going to be very difficult and they're going to have to focus on it but we have a lot of people that are going to help him. >> good to see you tonight, sir. >> thanks. and coming up, religious freedom case out of zoearizona where some vendors are saying they're being forced to support same-sex events. we have an attorney telling us about one set of business owners who say tonight, enough is enough. some of the media running stories about the impending trump economy, arguing that any success is going to be due to this guy, president obama. chris stirewalt, rich lowrie here with reaction to that.

>> the thing i didn't anticipate up until a few months before my election is that we were going to be in such a deep crisis, that i would be inheriting --

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breaking tonight, days after president-elect trump brokers a deal with carrier that saved hundreds of american jobs, new questions as to what exactly a trump economy could look like. one thing the media is confident about tonight, who deserves the credit in the case of any trump economic success. from politico, trump inherits obama's boom. the "the new york times," president obama is handing a strong economy to his successor. and from c nbc, obama's biggest

parting gift to trump may be the economy. only the current occupant in the white house deserves the credit for the success. watch. >> we helped stop a recession from becoming a depression. the things i didn't anticipate was the fact we would be in such a deep crisis that i would be inheriting -- >> save the economy from the great depression. that was pretty good. the economy was contracting faster than it was during the depression. >> they're leaving mr. trump with a gift compared to the economy obama received from president bush. chris stirewalt and rich lowrie are here. good friday evening to you. chris, i'll start with you. it seems to me that everything bad that happened during his presidency was president bush's

fought but all of the good was president obama's fault, to his credit. and now he's getting credit for if something good happens to trump with the economy. is that fair? >> fair is sort of an unimportant word when we talk about politics. the cock that crows and take credit for the sunrise, that's a thing and president obama did that. the economy that donald trump is inheriting from barack obama is a heck of a lot better than what was basically a garbage scowl on fire and sinking to the bottom of the hudson river in 2009. so that's partly true. but it's also part of a narrative that you can tell that the press is setting up so that what trump gets that's good at the beginning as a mar in the fender. it's not showroom fresh. >> there were there other headlines that said the same

thing, you're welcome donald trump. >> this is about preprepreparin the ground for the next few years, it's all going to be you know what, he just got lucky, he happened to inherit this great growing economy from president obama. we've had a recovery for years now but it's been the slowest growing economic recovery since world war ii, averaging 2% growth. there have been all of these economists opining about this, this is the new normal. and trump is saying he's not going to accept the baseline of med y mediocri mediocrity. >> the unemployment rate dropped and you and i know, even if you were seeing family and friends around thanksgiving, still struggle economically.

there are a record number of people that have jumped out of the workforce, not even part to have calculation. more than 95 million people. >> one of the reasons that the unemployment rate is so low is because we have the lowest labor force participation. so yeah, that's part of it. but we have seen something that is important and that is wages finally started to grow. the unemployment rate is sort of -- i'm going to dare say meaningless at this point. what really matters is wage growth. and we have finally, after eight years almost, started to see wage growth. that's the thing that means people go on a week of vacation, people feel they can buy extra christmas presents. if that accelerates, donald trump is going to have a very happy first quarter of his presidency. >> how much pressure is on him to deliver when he talked about blowing up the gdp in growth and making unforeseen things happen? >> a lot.

we're going to enter a phase where the tweets don't matter. if he delivers higher economic growth and wage growth, it's not going matter what the democrats say. he's going to be a popular president. creating a tighter market by policies that create tighter economic growth at the time same trying to tighten up on foreign competition and immigration. so you get the tighter labor market further down the income ladder and people actually see their wages go up which is what they need to really feel better about this economy. >> which means i'm getting more bacon for chris as a christmas present. and i think it's hockey tickets for rich, i don't know. thank you very much. >> you know us well. thank you. coming up, more campus cuddling for the poor little cupcakes ahead of exam time from

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developing tonight, a free speech case out of arizona filed back in may back in the spotlight tonight. a pair of christian business owners are part of a group challenging a local ordinance in phoenix. the law requires them to do business for same-sex ceremonies. they create custom wedding invitations and they say the law represents a clear violation of their first amendment lights.

the vice mayor is standing by the law as necessary to keep the businesses in that area. >> you've seen companies such as pay pal leave communities that don't stand up for their rez deb dents. this is an important economic development tool and we'll defend this. >> senior counsel for alliance defending freedom represents the business owners and joins us live. i know this has gone to the trial level and they lost. i want to read what the judge said. the purpose of the wedding invitation is to con tray the date, time and place of the wedding and the people getting married. listen, they're not endorsing the ceremony, they're simply crafting people that would tell people where to go for the wedding. your response. >> the case involves artis paying expression. the issue is whether the government can force artists to create art in violation of their convictions. and this ordinance imposes jail

time potentially on artists and fines. six months in jail for every day that that i ooher not in compliance. we don't force artist to create artistic expression under threat of jail time. >> it says as part of the ordinance that they can't directly or indirectly display, circulate were pub la size or mail any advertisement notice or application that states that any service would be refused or restricted. now why you're here and not your clients is because they're worried that this ordinance says if they speak out why they would refuse service that they too would be facing jail time for sharing their convictions and opinions? >> right. that's exactly what the saw says if. if they directly or indirect ll suggest that they may have beliefs based on marriage between one man and one woman, then it's six months in jail for every day they're not in

compliance. it's an extreme penalty. our clients would love to be here to talk about their beliefs and their art. >> i went back and read this the other night. that involves christian graph r photographers. one judge said get over it. it's the price of citizenship and you're going to have to do it. >> americans don't give up their constitutional rights because they want to earn a living and feed their children, nor do artists. the suggestion that you would not be able to create art and sell it and be protected under the first amendment is not supported by the supreme court precedent. and the first amendment protects this kind of expression. >> how do you feel about the appeal? are you confident that another judge may see this differently? >> we are confident that another judge will see it differently. there are hundreds of years of precedent on our side in this case. and again we go back to the basic principle free speech is a

bedrock principle in the first amendment. this law can just as easily force a democratic speech write tore have to write for a republican. an atheist singer to be forced to sing at an easter service. if we're allowing a bedrock principle of the first amendment to be compromised, then we know that other civil liberties are sure to follow. >> we would love to talk to the artists at whatever point that becomes possible. we'll track the case. thank you very much. now to react to that discussion, attorney eric guster. what say you? >> i don't know about this argument. it's very interesting. when there's a business, they are in the stream of commerce and must treat everyone equally and that is what they business is. they're not painting two women together in bed or two men together in bed. this is writing wedding

invitations. that may be considered art by many but i call that printing an invitation. what this young is going to rule, the appeals court, they're going to rule that the business is wrong and on several issues. number one, a business cannot discriminate. a person can say things all day long. but as a business you can't. you can't say i'm not going to serve your because you're a gay couple or i'm not going to serve you because you're black or because you're white. they can't do that. >> okay. let me talk about that. i've talked to a number of the businesses, the florists and the cakes. i have gay employees. u i have no problem serving them. i'm not denying service based on their gender identity or sexuality. i'm saying i don't want to take part in a ceremony that offends my beliefs. chip and jo gaips are being dragged into this. is there room for them to say i'll serve you but i won't take

part in the service. >> they're saying i'm not going to serve you. >> they've served gay patrons. >> but that is part of their business. their business is writing the invitations. that is what their business is. they're refusing to provide a business service based upon those couples being homosexual cupouple couples. that is why it's constitutionally incorrect. >> what about designer that won't serve her because they don't like the viewpoint melania is connected to because of her husband. if the designers don't make dresses for her. can we say that florists and bakers don't have to do things that they're not aligned with. >> melania trump is not a protected group. >> they're not denying service on the basis of being a

protected group. it's the next sfetep, the viewe saying i don't like the viewpoint of mr. trump. >> the designer is saying i don't want to dress her but if she walked in the shop i'm sure they would sell her a dress. that is the major difference. if they said i'm not going to serve melania because of her race or i don't agree with her racial identity, that would be a problem. >> we got to leave it there. thank you so much. more news right after this nothing says "treat yourself" like red lobster's holiday seafood celebration. so try new dishes like the new grand seafood feast, and the new wild-caught lobster & shrimp trio, with a lobster mac-and-cheese topped lobster tail. come treat yourself to feast fit for the season before it ends.

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developing tonight, here's a fun on ♪ developing tonight, here's a fun one, a writer for "cosmopolitan" magazine is facing criticism for suggesting victoria's secret design racist lingerie. models flaunted asian and mexican inspired fashion. one writer not amused, arguing the lingerie change is guilty of cultural appropriation. after the article made waves the link was removed from the magazine's website. schools aross the country can coming under increased scrutiny as they take sensitivity to towering new heights. remember the crunch time before your exams? did your school bring in these cute puppies to help you manage the stress?

how about the massage? secondly, at the high school level some of american lit's most beloved and important classics have been banned f classes. trace gallagher has both reports from the west coast news room. i want a dog. >> reporter: the adventures huck will berry fin was written 130 years ago, to kill a mocking birl 60 years ago, and both have been required reading and both are yanked off the schools in accomack schools in virginia. they made the call after a parent complained about the books having racial slurs, listen. >> right now we are a nation divided as it is. what are we teaching our children? we are validating these works are acceptable. they're not acceptable by no means. >> not everyone agrees with the move, with one resident saying, quote, i don't want to see it happen because if you start with would be racial word in a book and have to go on and on and on an pretty soon you will be

burning books left and right. a committee of faculty and parents will make a formal recommendation as to whether the books can come back or not. for the record, there are 219 racial slurs in twain's novel, 48 in harper lee's. some college campuses like the university of north carolina are concerned about the stress of final exams they're offering free food, acupuncture and massages for students at so-called relaxation stations. at the university of louisville you can engage in puppy therapy. at the university of kansas city you can take a break from studying for a stress buster event featuring coloring, meditation and some knitting workshops. shannon. >> hmm. thank you, trace. we are going to get relaxation station set up in here, guys. that sounds gd, complete with dog goes. maybe's "settle for more" makes a stop at the villages in florida. they loved her. we will take you behind the scenes next.

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earlier today megyn . earlier today megyn kelly went to the villages in orlando on the final leg of this week's "settle for more" tour. she says a big thank you to all of her fox news fans for the huge out pouring of support you have seen, given her throughout the week, chicago, fort hood, and especially check it out today at the villages. watch this. ♪ >> the villages. here we come. [cheers]. >> great to see you again.

hi. >> hi. >> nice to meet you. >> nice to meet you, too. >> hi, megyn. >> she's beautiful. she is a beautiful girl. yes, yes, yes. >> hi there. how are you? >> good. >> what is your name? >> p annie. >> how old are you? six? >> seven. >> very well. >> hi. >> hello. >> how you doing. >> i'm good. >> nice to meet you. >> i hope you learn something from the book. and there's a couple in in, you just breeze right by though. >> it's your birthday. >> happy birthday. >> i want a picture. >> so, megyn -- >> yay! >> thank you. it was a lot of fun. enjoyed it. >> i got to tell her we watch her all the time. love her show. >> oh, my god, megyn kelly. >> hi. >> hey. >> you look like a man with style. >> i watch fox news a lot and i watch her show a lot, so it was a great experience to meet her. >> i have watched megyn

throughout the entire election. that's where i kind of got to know her. >> i loved it. she is just as beautiful as i thought she would be, and she is so nice. >> yeah. thank you. ♪ >> hi. >> hi, nice meeting you. >> nice to meet you, too. i love that. that makes me happy. [ applause ] >> it is good for the soul. [cheers] ♪ >> nice to meet you. >> bye. >> how fun is that? oh, my gosh. we have a round of applause in the studio. that looks like a fun week, all this i'm sure it was a long one

for megyn on the road. do not forget to buy your copy of "settle for more." thachk f thanks for watching. in is "the kelly file." the best selling author will be back next week with you on fox news. ♪ welcome to "hannity." so the alt radical left are becoming completely unhinged. trump's senior adviser kellyanne conway will be here with reaction. first. we have tonight's opening mono log, the liberals and the main street media are losing their minds off the fact that donald trump is going to be the next president of the united states. now last night the harvard institute of politics held a forum with operatives from both political campaigns, kellyanne conway attended and had this exchange with the clinton campaign's communication director, the one and only ever