one-two kick of ro*tel's diced tomatoes and spicy green chilies. then, find space for extra parking. lots and lots of parking. ♪ >> president trump at his winter white house in florida. spending the holiday at mar-a-lago with his family as he marks his first christmas in office. welcome to america's news headquarters and merry christmas, everyone. i'm patti ann browne. >> merry christmas to you,. >> he had he had i'm ed henry. the white house fielding calls from the kids. help with defense department and norad. earlier the president offered christmas wishes to our service members stationed all around the world. >> today and every day we are incredibly thankful for you and for your families. your families have been

tremendous. always underappreciated the military families, the greatest people on earth. >> rich edson is live right now in west palm beach, florida. rich, the president spending time with family today? >> yes. a very publicly quiet day for president trump and first family. haven't seen much of him today. also a quiet day on twitter for the president. fairly unusual for him. though this morning he did tweet out a christmas video message from himself and the first lady. >> our fellow americans, melania and i have delighted to wish america and the entire world a very merry christmas. >> at this time of year we see the best of america and the soul of the american people. >> the president and mrs. trump spent time at a religious service last evening at the nearby bethesda by the sea. it's episcopal church. that's also where they were married 12 years ago. penny? >> also some serious business for the president

today. >> that's right there was suicide attack in afghanistan earlier today. aides says the president briefed on that attack. isis now claiming responsibility for that attack that was on afghanistan's national intelligence agency in kabul killing several people. also, some bits of serious debate for the president or touting for the president earlier this weekend. when he was talking about the agenda and what's been accomplished this year by his administration and by republicans in congress. the president tweeting out this weekend, quote: the tax cut reform bill, including massive alaska drilling in the repeal of the highly unpopular individual mandate brought it all together as to what an indreadable year we h don't let the fake news convince you otherwise. and insider polls are strong. perhaps a response to some of the outsider polls showing the president at least for his public support is under water. there is also a very long of congressional action the white house is asking congress to accomplish whether it has to do with

even more healthcare issues, budgeting, the debt ceiling and immigration. >>: rich edson live in florida, thank you. he had he had tax bill biggest accomplishment in the. president and republicans working together to score that legislative win before his deadline of christmas. but, will that kind of goodwill last into 2018 joining us live is marcia quinn of the examiner. >> hi. thanks for having me. merry christmas. he had he had months even weeks ago that the president he was tweeting bad job repealing and replacing obamacare. is this a case of winning cures all isles? >cures -- all ills. >> we saw it when lawmakers were gathered alongside president trump. everyone seemed to be in joyous and happy move coming

off passage of tax reform package. when you look at how the dynamic has shifted among republican leaders on capitol hill and president trump, there are some differences from when they attempted to repeal and replace obamacare. and now when they did successfully pass tax reform. president trump largely left the details of this tax reform package to the policymakers on capitol hill. set some parameters. but, really it was up to them to come together and compromise on this legislation. and where president trump stepped in is we're really working and trying to get all republicans on board. and that path forward obviously proved very successful. >> indeed. something else the president said at the white house before he left for florida a couple days back he is not going to hit the roads too much selling the benefits of tax cuts even though it's low in the polls right now. he said this thing is going to sell itself. it's going to get better over time as people see their wallet getting fatter if they will. will that drive republicans closer together for the mid terms as well because they have something to sell?

>> that seems like that's what republicans in congress are banking on heading into the 2018 mid terms. as much as democrats want to come out and speak poorly about this tax reform. regardless of what public opinion poles show. when americans look at their paychecks, when they go to file their taxes and i believe it's going to be 2019 now, they will really go ahead and see the impact and the positive effects of this tax reform legislation then. and they're hoping to use that as well as the fact that this bill repealed obamacare's individual mandate to sort of carry them through and help them maintain majorities in the house and the senate. >> it will impact tax year 2018. the irs telling them in terms of withholding people start feeling it in their paychecks probably as earlier as this coming february. talk about the dynamic when you add in the democrats, the chuck and nancy relationship as we like to call it some weeks back when the president cut that

budget deal with chuck schumer and nancy pelosi. there were republicans senatorring frosmarting from th. in 2018 he wants to quickly move on to infrastructure which is something a lot of republicans support. as you know, it's all about reach across the aisle to democrats. how does it change the dynamic. >> he did negotiate with chuck schumer and nancy pelosi on that budget deal. but, looking into 2018 republicans have even a slimmer majority in the senate in particular than they did this year. they only have 51 seats with doug jones' win in alabama. so, if republicans want to pass significant items on their agenda, such as immigration and i mean funding for the border wall, not necessarily legal protection for the dreamers, they are either going to have to rely unite and stick together as a caucus or they will have to reach across the aisle and work with

democrats. in terms of some of president trump's top legislative items, infrastructure, welfare reform, president trump's border wall that he promised over and own again on the campaign trail. republicans have to come together to make that happy for dump. >> now that's mandate. there is a concern that that may drive you recall premiums up even higher. where do you see healthcare crystal ball 2018 repeal and replace and finding something that stabilizes the markets? >> well, it seemed initially that perhaps the white house and even mitch mcconnell wanted to put healthcare aside for 2018. but mitch mcconnell came out just right before congress left for the winter holiday and said, look, if we can come up with some sort of a reform package that gets 51 votes in the senate, we will go ahead and try. right with the tax reform package, mitch mcconnell and president trump promised

susan collins, republican from maine that she would get a vote on a bill that would stabilize obamacare's markets. and it seems like that is going to be an issue, something that republicans are going to have to grapple with and potentially vote on heading into 2018. it will be interesting because conservatives particularly in the house don't want to be viewed as doing anything that would prop up this healthcare law. so, at this point in time it seems like it's really up to republicans irepublicans in cono see if they can come up with a plan that not only pleases fellow republicans in congress and debates and democrats that can pass in the senate. >> thanks for joining us today and merry christmas. >> thank you. and merry christmas. >> nikki mail announcing reduction in the budget. $285 million. she calls it a step in the right direction to making the global body more efficient and accountable. the move comes after the u.n. voted overwhelmingly last week to oppose

president trump's decision to recognize jerusalem as israel's capital. david lee miller is live 00 our new york city with more. >> hi, patti ann. 5% of the current core budget billion dollars. no specific was how the money would be saved a statement access there have been intution us wipe it the u.n. the. nikki maley saying inel efficiency of the united nations well known. we went let the general ross ski of the personal people be unchecked. other moves toward more efficient and accountable u.n. is a big step in the rite direction. haley's announcement follows a vote in the united nations general assembly rejecting president trump's decision to recognize jerusalem as israel's capital. at that time haley warned the u.s. would be, and i quote, taking names.

and true to her word, last week, haley announced that the 64 countries that did not vote against the u.s. position on jerusalem will be invited to a party early next year. on the list of attendee, tongue go, guatemala. just announced it's going to be moving its embassy to jerusalem. as forth u.n. budget a recent studies that they earn higher than u.s. counter parts a paying 22% of its basic budget. japan by the way is the second large e. contributor at 10%, which is a little less than half of what the u.s. is kicking in. patti ann? >> jeff flake putting donald trump on notice. he says he face a challenger

in 2020. political panel on that next. >> another country following president trump's lead in recognizing jerusalem as israel's capital. despite the backlash and violence over the move in the middle east. how significant is this move in guatemala? we'll discuss that ahead. >> thank you very much to guatemala. we thank the president of this country and also the people of guatemala for the important decision to move the embassy to jerusalem. t. i d.

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usaa members for life. usaa, get your insurance quote today. today's senior living communities have never been better, with amazing amenities like movie theaters, exercise rooms and swimming pools, public cafes, bars and bistros even pet care services. and there's never been an easier way to get great advice. a place for mom is a free service that pairs you with a local advisor to help you sort through your options and find a perfect place. a place for mom. you know your family we know senior living. together we'll make the right choice. >> ed: pope francis sharing his christmas message to the world. the pontiff noting that, quote: the winds of war are blowing in our world and saying, quote: an outdated motel of development continues to hurt society and the environment. he also called for an end to the israeli palestinian

conflict. there have been violent protests in the middle east and elsewhere after president trump announced moving u.s. embassy from tel aviv to jerusalem. >> patti ann: amid the protest and u.n. vote condemning the president's move guatemala. it too will move its embassy to jerusalem. guatemala was one of seven countries which voted with the u.s. and israel against that u.n. resolution. foreign policy analyst ari are a measurare aari armesh. >> good to be with you. >> patti ann: the czech republic reportedly considering the move and guatemala says it will. 128 member nations voted for that denouncing the u.s. what's your reaction. don't expect a floodway of

countries coming to jerusalem and opening embassy there. the israeli parliament passed a resolution jerusalem as the only solid sole capital of the state of israel. only three countries after 1980 moved to jerusalem. earth in netherlands and costa rica and el salvador. he a all of a sudden moved out. latest was in 2006, costa rica moved out and went to tel aviv. while jerusalem is the capital of israel, i'm not sure what the president has gained by a bringing so much heat and attention on israel and so much foreign policy by bringing this issue out to the limelight and, also, this issue has always been a final status issue for every u.s. president. every american presidential candidate from both parties has said that israel is the

cajerusalem isthe capital of is. they always realized to have some credibility as peace mediators between the palestinians and the israelis they would have to leave the issue of jerusalem as the final status issue, which means when the palestinians and the israelis reached a final stages of a peace deal for a two-state solution, then that bargaining chip, which is jerusalem being recognized as a capital of israel will be handed over and will be sort of recognized as a final status reward. >> so, as have you made reference to, this decision has parked protest what are the implications for the middle east? >> not much is going to go forward. right now, unfortunately, the arab countries view the united states as a very biased mediator. on the other hand, the government of prime minister

benjamin netanyahu is also not very interested in making major concessions. not to mention the palestinians on the other side are so divided they have a completely fractured and fraction government. where on the one hand you have hamas and gaza not interested in peace and fatwa government chairman or mahmoud abbas so weak it cannot control any sort of violence or violent reaction. even if the west bank or in its own capital o. have you others involved. saudis, egyptians, which doesn't seem that theys are also entirely interested in peace. each party here comes to the table with many, many sort of hidable, agendas and interests. look at the turks, for instance right now that are trying to use the palestinian issue to galvanize support for embattled government of erdogan. the list goes on and on and

on. at the end of the day, the people who get hurt are civilians. >> patti ann: i want to quickly get to u.n. funding. u.n. ambassador nikki haley announced a 285-million-dollar cut. sounds like a lot but that's out of 3.3 billion that the u.s. pays 22% of the united nations' budget. what impact will this have? >> the impact is not going to be much in terms of operational budget but it's going to be big in terms of psychological impact. this money buys a lot of influence and goodwill. the foreign aid we give out. not just the u.n. budget foreign aid as a whole we hand out military aid, peace aid, so on and so forth. buys us a lot of goodwill. a lot of influence and a lot of leverage. we can pull out and we can leave that up seat for the chinese, to the russians, to other players, to the saudis, is that the right move to make? i would like to see america leading from the front.

i would like to see america funding these organizations and always maintaining a key leadership position. not just here in the western hemisphere but around the globe. that is our natural duty to do and that is our natural position to be at. i don't think cutting off funding to the u.n. or cutting off foreign aid to many allies is a right move to make that will only reduce our leverage and will cut our influence. >> patti ann: it's not cutting it off but it is a reduction. >> reduction, reduction, right. >> patti ann: unfortunately we are out of time. we will have to leave it there ara are we have to leave it there. >> ed: bus crash killed 20 people. >> patti ann: in a week pot sales will be legal in california. why people won't see recreational pot right away. >> we have dealt with medical marijuana for a if

you years here and the recreational is going to be obviously a different set of rules.

>> ed: time for quick check of the headlines, deadly coalition in the philippines

this day killing at least 20 catholic pilgrims and hurting nine others when their mini bus hit a larger public bus. the pilgrims were traveling for early morning service at historic church. what a strategy. about 200 miles north of the capital city manila. meanwhile, here at home central florida, small plane crashing just minutes after taking off yesterday airport killing all five people on board. we already said the plane took off for key west in very dense fog. and in southern california, a freight train derails and crashes into a building and burned it right outside l.a. no word of anyone hurt thankfully, cause of the crash under investigation at this hour. >> patti ann: in one week recreational pot sales will be legal in california. the rules are published but there are still a lot of questions about how the state is going to make it happen. will carr is in los angeles. that's actually a city that will not have recreational pot shops open for business come the 1st. will, why is that? >> well, that's right,

patty, merry christmas to you and ultimately a merry 2018 for pot companies in california. thereof is still a bit of a haze lingering over the rules. the state didn't come up with regulations until just over a month ago and that's left cities in california scrambling leading up to january 1st. >> so business also still have to come to the department, get temporary approval to do legal adult use sales before that even takes place. >> that means some cities like los angeles and san francisco won't be ready to issue licenses until after the 1st. while sales are expected to boost california's economy, there are concerns on the law enforcement side. police departments expect dui to go up and plan to adjust their overall focus. >> focusing on the large grow houses. maybe in neighborhoods that bring other elements, criminal elements to those neighborhoods. those are the quality of life type of issues that we need to still continue to

deal with. >> and while there are other states that have legalized recreational sales, california will by far be the biggest and for state politicians, that's sending a message to the rest of the country. >> it's the beginning of the end of the war on marijuana. which means it's the beginning of the war on drugs. you can't criminalize your way to good behavior. >> it's already legal to use recreational marijuana in california but you have to wait a week or longer to buy it legally come january 1st. depending on what city you live in, patti ann? >> will carr, merry christmas to you, too. >> ed: merry christmas. a man convicted of a felony waiting to be deported now calling it a miracle after a pardon, yes, from the governor allows him to make it home for christmas just in the nick of time. was that such a good idea? details next. >> patti ann: plus vice president joe biden with a holiday message wondering

whether he has his sights on the white house in 2020. our political panel on deck. ♪

>> don't rule anything out but it's not in my plans. i do believe if the president is running for re-election, if he continues on the path that he is on that that is going to leave a huge swath of voters looking for something else. >> ed: outgoing senator jeff flake of arizona firing a warning shot across his bough suggesting mr. trump is leaving himself up to a g.o.p. challenger in 2020. let's bring in kelly cohen, former regional field director for the obama campaign and democratic strategist. good to see you both. merry christmas. >> good to see you, too. merry christmas. >> ed: i want to start out

with you, not really a surprise that jeff flake is not a fan of the president. does he have a point that the president may be facing a challenger? >> i think he does have a point. jeff flake is obviously leaving the senate in 2018. i could see him maybe spear heading a bit of that effort in 2020. i'm not sure who that challenger would be 2020 seems like a long time away but very close. jeff flake has a point. >> ed: robin, i see you licking your chops already at the prospects of a president having a challenger. i also know not a single one of your democrats in the house or senate voted for this tax cut that the president says will sell itself in 2018. doesn't that victory alone put him in better political standing? we're far away from 2020. puts him in strong political standing, doesn't it? >> we'll have to see, ed, when they start selling this plan to the american public if the public buys it. i know that right now the tax plan sun popular with most americans. so they are out hitting the

pavement. and going to make this ditch to the american public. it's just going to be whether or not they buy into this. but i do think that he is opening himself up for a primary challenger. especially with his popularity right now. i think he is less popular in first term than any modern day president has been in quite some time. i think the the door is right open. >> ed: robin, let me stick with you for a moment before i get back to kelly. on the tax issue we have the 2018 mid terms before the 2020 presidential race. why is it that democrats couldn't see it in the wisdom. all of this is talk for the rich. you know independent studies saying independent going for the middle class. why couldn't your party support this. >> the majority of these tax cuts did go to the 1%. middle class americans are -- let me say, this 8 out of 10 americans are going to get tax cuts.

>> ed: the majority is not going to the rich then. yoyou are contradicting yourself. >> right. they say they proportionately weren't getting enough. for your middle class americans, they will see a savings of about $15 per paycheck. democrats saying not enough. that wasn't what he said on the campaign trail. >> ed: kelly, the president said a couple days back on the white house before he left for florida that i'm not going to have to get on the road much he said. this is going to sell itself. is he right or do we have to fact check it out in will he have to get out there and fact check it this is in low double digits the tax cut popularity. >> i think he can benefit from getting out and a pending the. i think the average american is going to be happy they are going to take the president at his worked. he clifford on a major promise before he left for the winter white house down here in palm beach. can i see him do a little bit of the pounding the

pavement. i also think americans are going to see that money in their bank account and hope and approve of it. >> ed: let's switch over to the democratic side. i got a sound bite i want. >> all the troops spending this holiday season away from their family and loved ones, please know, please know we think of you and we have your backs and we know what it's like. and we're looking for tour come home safely. >> ed: robin, hillary clinton didn't leave the stage, long book tour, now the former vice president putting out a christmas message to the troops, i'm still out there. he is thinking about 2020 isn't he? >> i really do think so. i think he would probably be the number one choice followed probably by warren and then maybe a tie between corey booker and kamala harris. i'm afraid the dark horse might just be mark zuckerberg which terrifies me. >> ed: what about bernie sanders though you? left him out. democrats don't like to talk

about him but he did very well against hillary in the primaries. number two, i guess that they are very early. bernie sanders is on because the left in your partiens him. >> make no mistake 'it. he will have to make that pitch all over again. i left him out for that reason that he is strictly right now an independent. but i do, if he can sell it again, he might just take it. >> ed: kelly, to be fair to robin, there are young faces, kamala harris, corey booker he mentioned could be in the mix in 2020. there are old faces, joe biden, elizabeth warren, folks that have been around for a long time. does the democratic party have an issue of regeneration. >> i think definitely the democrats after what happened with hillary clinton are going to have to look at that regeneration and that old face. i'm a young face. i want to see a young face out there representing me. you know, i do think joe

biden will probably end up running in 2020. i can say very early since it's not even 2018 yet that he will probably do pretty well. i do think that the democrats would benefit from a younger face. >> ed: so, robin, since we are two of the older faces since kelly is trying to send a message to us. what do you think about the elephant in the room switching metaphors. barack obama, he put out a tweet i noticed, merry christmas, everyone, he is entitled to do that he is not going to run for office again. how big of a role do you think he will. we heard about hillary clinton not getting off the stage. will barack obama be shaping the future of the democratic party. >> i think is especially if joe biden does jump into the mix. and i would reekly like to see the biden obama. i really used to love those meals. i think they could have a lot of fun with that. >> ed: isn't there a accepts

reef get for joe biden. a lot of republicans didn't like him. the party base loved him. sitting vice president thought hillary clinton has everything, maybe the word is rigid, maybe not. she has everything going for her. turned out she was a lot weaker. joe biden is probably regretting he didn't run. >> i think he is regretting it 2020 like he said is kind of around the corn everywhere. if he wants to wave that wave of regret into 2020. i don't see anything stopping him. like you said he is in a book tour right now and that's usually a pretty good stepping stone for somebody running for president. >> >> ed: we haven't seen 2018 yet. we're not that old. >> merry christmas. >> merry christmas, guys. >> patti ann: 2017 is almost behind us. it's been a wild year for news from president trump's inauguration to the me too movement.

movement. >> 2017 a new president took office while powerful men fell as women came forward to say me too. those stories and more dominating the headlines no 2017. the year started with a big change in washington. the inauguration of president donald trump. >> the people became the rulers of this nation again. [applause] the next day millions protested the new president at the women's marches across the country. biggest single day in history. presidents also confronting north korea after the test firing of intercontinental ballistic missile. the north also testing most powerful nuclear weapon yet, a hydrogen bomb. and launching a missile that scientists say can hit any point in the united states. in may, president trump fired the fbi director james comey. that led to the appointment of a special counsel, robert

mueller to run the investigation into russia's election meddling and possible collusion with members of team trump. the investigation led to the indictment of the former trump campaign chairman paul manafort and the former campaign aide rick gates l.s.u. the former national security advisor general michael film pleaded guilty to lying to the fbi about his contacts with the russian ambassador. he is now cooperating with a special counsel. charlottesville, virginia, became the scene of deadly demonstrations, a plan plowed his car into a crowd people demonstrating against a white nationalist rally and killed a woman. americans continue to recover from three devastating hurricanes which hurt during the end of the summer. first, harvey slammed into the u.s. as a category 4 storm. causing catastrophic damage to houston and the texas coast. we are just beginning the process of spawfnedding to this storm j next, irman.

it slammed florida andth yenian with deficit diseaghts ryan. finally puck wiping out power and killing a dozen people. on october the 1st o.j. simpson walked free after spending nine years behind bars following a botched robbery in las vegas. and just hours later in las vegas, the deadliest mass shooting in american history. 58 people killed and more than 500 wounded when a gunman fired into a crowded country music festival on the las vegas strip. still, no word on his motive. just a month later, another deadly mass shooting. 25 people died, including a pregnant woman during a sun church service in souter land springs, texas. >> no attack, no act of violence will ever break our

spirit or diminish the faith of the american people. >> inning on the harvey weinstein lost his job and r. and so much more after a doesen women accused him of. then there is roy moore and the alabama senate race. women accused him of harassing and assaulting them years ago when they were teenagers. moore lost the special election to the democratic opponent doug jones. finally, the house and senate passed separate tax bills calling for the largest overhaul of the american tax code in more than three decades. looking ahead to 2018, the midterm elections coming up. the whole country waiting to see if voters will reject or reward president trump. we're also keeping a close eye on tensions with north korea and the latest sexual misconduct accusations. of course, we'll be here for all of it. in new york, i'm shepard smith, fox news. >> ed: thanks, shep. pennsylvania woman got quite

a shock from her electric bill on her last statement. a charge for $284 billion. yes. that's billion with a b. she says she thought maybe she put her christmas lights up wrong. but then her son called the company and of course turns out the actual balance was $284.46. the decimal point was in the wrong spot. the woman says all she wants for christmas now is a heart monitor. patti ann she almost had a heart attack. that decimal point was way in the wrong spot. president trump says the sweeping tax will mean tremendous tax cuts. will will that help you in the final days of 2017 on 2018 tax bill. we'll have the answers. >> ed: that's important to know. white christmas in some parts of the country. holiday dream come true can also be a travel nightmare.

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50 miles per hour that would created blizzard conditions making travel very dangerous to maybe even impossible. folks in washington state also having a tough time on the roads because of snow. the holiday spirit kicking in with some of the drivers. >> helping some people because you have key the anker that comes from all of this. it's just no fun. i'm doing this just because it's christmas eve and these people want to get home. i'm trying to do all i can. >> scared and i don't want to drive anymore. i'm stuck in the middle i can't go anywhere. >> ed: the storm giving seattle its first white christmas in nearly a decade. patti ann? >> we are giving them a big beautiful christmas present if the form of a tremendous

tax cut. >> patti ann: that's president trump saying he made good on his campaign promise to slash taxes when he signed the sweeping tax reform into law. how will those changes effect average americans and small businesses let's bring in entrepreneur capitalist of sor consultants. >> good to see you. >> patti ann: the first 10,000 of those taxes is still deductible. is this going to have as much impact as some people think. >> the best way to look at it is if you live in high stacks state, yes. new jersey, new york, california. this is more or less what we have been hearing about. for the rest of the country and nibble who lives in the other states, i think it should be great. >> patti ann: also, obviously a large corporate tax rate reduction. economists disagree as to how that's going to benefit the economy. supporters say it's going

tone courage companies to expand. they are going to create jobs. those people are going to go out and buy things. it's going to grow the economy overall. we are hearing well over a trillion dollars to the national debt. is that growth going to make up for that? >> okay. so, let's start with the motivation of this whole tax reform started out with corporate taxes. i think in summary that's what we all have discussed. in short-term, consumption definitely will be great. companies that will be able to pay to the shareholder, expand their businesses, consumption is going to go higher which is going to be great for 2018. on the long-term is the concern. 2019 and forth when the higher fiscal deficits are going to go way out of whack. and we're going to see our g.d.p. go down. so first, we're speculating 3% or higher. and then after that probably is going to go back down to two. >> we are going to hold you to that prediction.

we will see what happens. the standard deduction, doublindoubling from 12,000 to 24,000 for a married couple filing jointly that means loot more people are probably going to be taking the standard deduction next year. which means if they want to benefit from some special deductions this year, what can they do? they have a week approximately. to maybe get some deductions that they are not going to get next year. one thing people say is give to charity. if you are planning a big donation to your college, do it now because you get more from it. >> probably best and fastest and easiest thing to do is to make contribution to a foundation or university. for next year and biggest problem we have with accounting or filing our taxes is very reactive. so we wait a whole year to be done and then we file our taxes to start thinking what should we do at that point? in terms of advisory, i would say people if you can make payments now, early payments to the irs which they are going to love that

it may at the end of th at the e year be better off for you. >> patti ann: we are hearing advice when i guess is not allowed in every jurisdiction with you some will aloy you to prepay your taxes, we're talking property taxes, other types of taxes if you prepay them now, you can get the benefit of that deduction. not everyone will let you do that. >> that still happening in congress and still talking about this. i would stay with what's happening locally. depending where you live, just to understand better what could be beneficial to you or not. >> patti ann: worth looking into your own jurisdiction whether can you or not. get the deduction if you prepay it now. >> in new york you can. >> patti ann: okay. >> i can't speak for the other states. definitely try to do that myself. >> patti ann: absolutely. they also say pay business expenses like union dues, professional fees even buying office splice, whatever you need, do that

now because you get more of a deduction for that now. >> true. true. so as a business owner, that's what i did myself. so i stocked um on everything for my office for the next year, small companies do the same. large companies i don't think they really care about this. individuals it's on a per need basis. it really depends on what you want to do. >> also the amt changes that, right? if you are going to be subject to the amt, you don't want to necessarily go there. with some of those, right? >> i'm not quite sure on that topic. >> patti ann: the problem is it's all so -- it's very complicated but they do say also put more money into your retirement funds now if you can. >> sure. we have to think about this, also. as soon as the economy starts doing better, this is going to put an upward pressure on wages, right? which means that corporate earnings are not going to be so great because they are going to be spending more money on the labor force. but we also have another issue with the retiring baby

boom generation that is coming up. and that's going to take -- that's going to limit labor force from the current economy. so, measure indicators macroeconomic point of view, we will see once again like i said, nice 2018 and i think right after that we'll start feeling, again, that deficits in our fiscal policies. >> patti ann: interesting. michael, thank you so much. >> you're very welcome, thank you. >> patti ann: ed? >> ed: meanwhile harvey weinstein sex scandal having impact. not the only thing we have low down. >> ed: what actress meghan markle did today and how the queen figured in next. ♪ ♪

>> patti ann: a christmas message september from up above. no, not heaven. not that high up but the international space station. astronauts up there sharing their fondest holiday memories. take a listen. >> my fondest memories of the holiday season is when i was a younger boy. all of the family would get together and just hang out. we would get up early on

christmas day 4:00 or 5:00. the lights were out. we would sneak down and see what santa left us under the tree. and we have this great honor of being up here celebrating it as a little family. but then looking back on our beautiful planet and reflecting on how important it is to us. >> ed: that's awesome because you can't get kids up usually that early about 4:00 or 5:00 in the morning. i remember as a kid you want to sleep as long as can you and don't want to go to school on christmas you want to get up at 4:00 in the morning. so much anticipation. >> patti ann: absolutely. those were great memories they had. >> ed: charity sticking to decades long tradition. hosting a christmas lunch for the homeless in rome. the community holding event inside the church of santa maria today. syrian refugees, the charity has been hosting this lunch since 1982. >> patti ann: meanwhile prince harry and meghan markle stepping out in

public first christmas as engaged couple. here they are attending the royal family traditional christmas day church service. the rest of the royals were there too. including the queen in that bright outfit. prince william and duchess kate making an appearance and shaking hands with people outside. >> ed: everyone obsessed with the royals, big wedding coming up. >> patti ann: exciting. >> ed: queen elizabeth still going strong as well from. a big oscar filibuster to the tide of sexual harassment scandals. hollywood made lots of headlines this year. adam housley out in l.a. has the run down. >> the biggest entertainment story of 2017 is far from over. starting in october with sexual allegation against media mogul harvey weinstein when several actresses accused him of inappropriate behavior. that started a landslide of others to come forward. kevin spacey, dustin hoffman. ck. jeremy and today show host matt lauer. >> there is a mistake,

moonlight, you won best picture. >> at this year's oscars there was a huge blunder when warren beatty and fay dunaway announced the wrong best picture winner giving it to la la la land instead of moon light. contrary to what most people may think after 220-million-dollar opening of "star wars" "the last jedi" the ninth didn't make this top five movies of 2017 but these did. disney's live action remake of beauty and the beast topped all by making $504 million. wonder woman came in second powered by 412 million. no surprise number 3 guardian of the galaxy volume 2 with 38 million and spider homecoming. rounding out the top that 5 is the who arer film it scarinscaring. concert tragedy struck twice when suicide bomber targeted

ariana grande show killing 22 people. then on october 1st, a gunman opened fire on a route 91 harvest music festival in las vegas killing 58, injuring 546. hollywood major breakups include chris pratt and alex. gasher. fergie ben still ler and christine taylor. two power couples welcomed twins this year george clooney and wife amal and jay-z and beyonce. >> the top three album of 2017 include kendra lamar damn and 24 k magic by bruno mars and the weekends star boy >> sitting the year's number one song ed shearn's and depocito. the honor of most streamed song of all time. >> congratulations from all

of us. >> other major stories celebrate the upcoming wedding of prince harry and actress meg bega. >> meghan: began mark telling. and after 146 years of being the greatest show on earth ringling brothers and barnum and bailey circus brought down their tents. finally, there was some sad farewells during 2017 leaving a void for many fans, sound garden's front man chris. hugh hefner. chester bennington, tv legend mary tyler moore. don rickles and rock icon tom petty. in hollywood, adam housley, fox news. >> patti ann: amazing when you look back at it all how much happened. >> ed: remember when a scandal was giving out the wrong optic? >> patti ann: president

trump attending christmas supervisors with the first lady in mar-a-lago. the president has managed to keep busy this christmas break. ahead we will tell you what he has been up to. ♪ ovide as much - or as little help - as her mom requires. whether it's a ride to the doctor or help around the house. oh, of course! tom, i am really sorry. i've gotta go. look, call right at home. get the right care. right at home.

>> welcome back. i'm ed henry. >> and i'm patty ann brown. to all of you, we begin with president trump wishing america and the entire world a merry christmas from mar-a-largo in south florida while celebrating the passage of the gop tax bill. and taking at at the fbi's deputy director. rich edson is live in west palm beach, florida not far from mar-a-largo with that story and more. rich? >> the president speaking publicly, has taken a very relaxed approach to this holiday

day. he's spending the holiday with his family at the mar-a-largo resort. the president has been restrained on twitter. he opened the day with a tweet with a holiday message from him and the first lady. >> on behalf of melania, myself, baron and the trump family, god bless you and america and have a very, very merry christmas and a happy new year. >> the president and first lady spent their holiday service last evening at nearby bethesda by the sea episcopal church, also where they were married 12 years ago, patty ann. >> so the president, rich, says he's working very hard during this christmas vacation. what will he be up to? >> well, as is the case with president trump and previous presidents, world events don't stop because you're down on your holiday vacation. that was the case this morning. the white house says aides briefed the president on a suicide attack in afghanistan's capitol on an intelligence head

quarters in kabul. isis has taken the responsibility for that and killed several people. the president touting his first year in office tweeting a couple of days ago "the tax cut reform bill, including massive alaska drilling and the repeal of the obamacare mandate brought it together. don't let the fake news convince you otherwise and our insider polls are strong. from here, the president has a lot to conduct after the holiday ceiling. there's the debt ceiling and the budgeting and dreamers and immigration reform. robust schedule for congress. the president is here in mar-a-largo enjoying the christmas holiday. back to you. >> rich edson live in florida. merry christmas to you. >> all right. the republican party and president trump getting some momentum going after passing that tax bill, so can they continue that trend into 2018?

let's bring in republican congressman mark walker of north carolina. chair of the republican study committee and conservative caucus in congress. good day and merry christmas. >> merry christmas to you and our troops around the world. >> absolutely. glad you said that. i want to know what you think about that long list that rich edson was going through. the president has had fierce criticism from day one, before he took office, before day one. how is he ending the year? >> in a very solid matter. some of the more establishment types as you have noticed, the rhetoric has lessened and more of a gop unity. i don't know how long it will last but we're in a good place. >> and it seemed to be that the president and mitch mcconnell were unspeakable and the president suggesting he should be replaced after the failure to repeal and replace obamacare. >> i do know this. the house passed all 12 appropriations bills. the first time in 13 years.

however, i will say we have to give a little shout out to the senate. for the first time ever, they got 12 federal circuit judges approved. the most in the history, i believe. good i don't know there. >> the president suggested the pep rally with the republican leaders a few days back that winning can cure all ills. winning is better than losing. we know that he likes to win. what is the next win for this president? >> the next win -- i know he's very concerned about infrastructure. rebuilding the nation's infrastructure. very important to us. also, we have 156 members in the republican study committee. the majority of our team, our members, great men and women throughout the country, are very concerned about our spending as well, this is something that we promised we would be fiscally responsible. >> how do you pay for infrastructure when you're not paying for the tax cut? >> i have a couple ideas. we have defense. the defense the last 8 1/2 and 9 years was depleted under the obama administration. we have to put forward a

balanced budget amendment. that get us to a resolution a few months ago. we're excited about it. if we hit the 2.8, 2.9% growth, we make up the 1.5 trillion but add a trillion to it. it's very important to it. >> what can viewers expect from republican leaders in terms of healthcare? we saw the big failure on repeal and replace. receipts move on. a victory in terms of pulling out the individual mandate, repealing that in this tax bill. that may mean premiums go higher than under president obama. so what is next? how do you get a win there? >> we're cautious in moving forward. we heard several different -- murray alexander. what we heard is the brady hatch version, kevin bring did orrin hatch version that goes after the employee mandate. the henry hyde language has been around for decades. >> on abortion. >> sure. we want to make sure moving forward, we don't want to do anything to take us back. the house passed the unborn

child protection act that would end many abortions after 20 weeks. those are important as well. >> final question about democrats. they won't support this president on almost anything this past year. do you have any hope there's any bipartisan deals? you mentioned infrastructure as soon as i started the segment. that's something that chuck schumer and barack obama talked about for eight years. why can't they support the president? >> unfortunately it seems they're determined to play for the most fringe parts of their base. tax reform -- one of the things and tax reform, it's measurable and tangible. i'm hoping that issues like this when it impacts all americans, not just one party or the next, i would hope we would have democrat support. >> the president said he doesn't need to travel much in 2018 to sell the tax cut. it will sell itself. do republican leaders feel that's true? >> we do. we looked at the numbers and how

much it helps the lower income families, 50 to 75% in the tax cuts. we know in will be something that is celebrated. hopefully enough to keep us strong in the 2018 elections. >> thanks, congressman walker. you and kelly celebrate your 25th wedding anniversary. >> i'm impressed with your research. big plans? >> big plans. maybe go to a concert. >> merry christmas, happy anniversary. >> thank you. >> ahead, we'll get the democratic point of view on this. our next guest is the first big test for bipartisan cooperation, addressing the temporary budget extension that is set to expire next month. what she says both sides must do to get that done coming up on this christmas day edition of "america's news headquarters." after more than 20 years,

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>> president trump and congress working with the gop to pass a tax reform bill. now looking to keep the momentum going in the new year. before the break, we just spoke to a republican lawmaker. so for reaction on the democratic side, fair and balanced, let's bring in capri cafaro from the american university school of public affairs. merry christmas. >> merry christmas to you as well. >> it's christmas. i didn't want to belabor the point with the congressman. i didn't ask him how he was going to make for this. i assume the republicans will make a lot of noise about this. a tax cut not paid for. he talked about defense spending and infrastructure. democrats in fairness want to do that as well. how are both parties going to pay for all this? >> you know, i don't think anybody in washington has the answer to that immediately. i know that there's some

republicans that have talked about entitlement reform in 2018 as a way to counter balance the tax cuts that were just signed into law. that certainly would be a really tough pill to swallow in a mid-term election year and with the backdrop that. trump campaigned in. there's no cuts to social security and medicare. that would be a difficult way to go. as a former state lawmaker, we have no choice with the balanced budget. so washington will have to figure it out and just fore go the pay-go rules in order to pass the tax will. >> kick the can down the road. presidents, the president have said that they believe economic growth is going to pay for a lot of this tax cut. that remains to be seen obviously. let's move on to the other big issues. first of all on taxes. >> right. >> i wonder if you believe as a democrat this is a missed opportunity for your party? for a year it's been resist, resist everything this

republican president wants to do. i know you're more a centrist. was it a missed opportunity in saying giving people more of their money -- by the way, it's not washington's money. it's their money. was this a missed opportunity for democrats? >> yes and no. part of the solution, with the elimination of the individual mandate for the affordable care act, it's a poison pill for many democrats, even those like myself that want to support a tax cut. when you have them together, it's difficult. that in combination with the fact that the individual tax cuts were temporarily -- the corporate tax cuts were permanent, those are the things that the democrats took into account. however, i think it's a big mistake not to find ways to work with the majority party. because i think that's what the american people want. >> talk about democrats and the resist movement. obviously democratic leaders want to see daca codified into

law. children of illegal immigrants, being able to stay. the president wants to build the wall. he wants to crack down on illegal immigration. isn't that a fair compromise? >> i think it may be. i think there was actually a proposal in 2013 that, you know, for example democrats did support increased funding for boarder controls and patrols in that region as well as some funding for a wall. so we need to explore this. we need to make sure that those individuals, those dreamers they're called, you know, traditionally, are not being separated from their families as being discussed at the border and being sent back to countries that they may not have ever been to. we have a looming deadline. democrats aren't going to bush on this issue. i think they need to figure out a way to get across the finish line. what is important, these individuals that came here and only know this country.

figure it out. >> capri, last question. democrats have high hopes. they're talking about a democratic wave in the mid-terms. either party typically loses seats. is this a small gain for the democrats or a large gain? we're going to keep the tapes and have you back this next year. is it going to be a democratic wave yes or no? >> i don't think so. i think it's going to be down to turnout and what happens in the next 11 months in the economy and in the political climate. so too early to tell. i'd say modest gains but not a -- maybe a flip of the house but not the senate. >> we'll play the tape, have you back. >> sounds good. >> thanks, merry christmas. >> merry christmas. >> president trump renewing his criticism of the fbi taking aim on twitter at deputy director andrew mccabe and his handling of the hillary clinton e-mail probe. mccabe was on capitol hill

testifying on the russia investigation. his appearance coming as some congressional republicans step up their calls to fire mccabe. they say he's part of an fbi culture that is biassed against the president. we have more from d.c. with ellison barber. >> yeah, mccabe is eligible for retirement in mark. that's what sources are telling fox news. we don't know for sure if he will retire. we know he's eligible. for weeks there's been rumors about a somebody cake retirement. a few different outlets reported that somebody cabe would retire in the new year. the reports seem to have resulted in president trump taking to twitter where he attacked mccabe. the white house defended all of the tweets on "fox news sunday." >> the president is saying we need to have -- we need to know our civil servants are doing the honorable thing. it's important to let the american people know what happened in that investigation. >> mccabe spent over 14 hours

testifying on capitol hill. the democrats said the more broad attacks on the fbi are in their view about discrediting the special counsel's russia investigation. >> this is hearing is an attempt at a lot of diversion from the real issue, which is the russian attempt to subvert the last election, the possible collusion, or the certain collusion by many members of the trump campaign and possible collusion by the president himself. >> it's critically important that we respect the independence of the department of justice and the fbi. nobody is above the law, that mr. mueller do his investigation without interference from the president. >> so far we have not heard from somebody cake on this. he's not commented publicly on any of it. patty ann? >> ellison, the president has been tweeted about fbi official james baker what is his status? >> james baker was recently

removed from the general counsel of the fbi. the counsel he was appointed to in 2014. the counsel is reads in on all the investigations handled by the fbi. fox news has been told that baker has not been fired by reassigned and somehow could be tied to a separate leak investigation. the "washington post" says sources say there's a new director coming into the bureau and this is a normal part of that process. but on friday, politco reported that baker is tied to a mother jones journalist. the journalist is the first person to report on the existence of the trump dossier. the journalist says he doesn't usually talk about sources but he did publicly and adamantly say that baker was not his source for that story. >> thanks, ellison. >> ahead, the biggest priorities for congress and the president as we look to 2018 from immigration, healthcare and more

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>> the house and the senate pushed the deadline to funding our government back to january 19th, hammering out a more permanent deal is one issue lawmakers face. another problem, the dreamers, daca. and right now, chad pergram, the fox news senior producer on capitol hill. merry christmas. >> merry christmas. >> appreciate having you on. we talk about kicking the can down the road to january 19th. everybody patted themselves on the back. we kicked it down to january 19 but they're barely coming back to work before the 19th. >> remember ray guy, the punter for the oakland raiders? he never unleashed a punt like this one before the recess. when they come back, the senate will return january 3. the house doesn't have enough floor traffic, so they'll delay

their return to the 8th. that leaves 11 calendar days before january 19 and that's when they have to fund the government and reauthorize fisa, which is this controversial spying program. they have to deal with long-term military funding and daca at some point. down the road, the debt ceiling. the break down will return. it's 52-48. it will be 51-49 in a couple days. doug jones comes in from alabama and a new face succeeding al franken from minnesota, tina smith. >> i know you run around the capitol. i saw it last week when we worked on the budget. it seemed like some of the frustration i hear from people at the white house, it's not just the democrats have been resisting from day one but some of the president's fellow republicans maybe haven't been resisting but dragging their

feet about whether they want to get behind his agenda. does this tax cut victory after the failure on healthcare, does the tax cut victory provide new momentum for the president and his relationship with his fellow republicans or no? >> certainly provided that initial momentum to get over that initial deadline at christmas. a lot of people think the government may have shut down, which would have been catastrophic for the republicans. they had a very controversial meeting hours after everybody had gone down for the big celebration wednesday. one senior official that i spoke with said i didn't think we would pull this off. just the fact that they were riding that high after passing tax reform, that got them through that initial struggle to keep the government open, which would have been terrible. it was funny. i went up to paul ryan after the ceremony thursday at the capitol. i said what are you going to do in the next few hours to keep the government open. he said chad, let's just enjoy this for right now. that seemed to be the approach.

>> don't rain on my parade. we just had a victory. i don't want to deal with that yet. >> exactly. >> what about the dynamic of when the president reached across the aisle for the chuck and nancy deal. some republicans that were smarting about the president going around ryan and mcconnell. now he has the tax cut victory, no democrats getting on board. if you're going to get infrastructure and other things done in 2018, talk about the dynamic of him reaching across the aisle to schumer and others. will they be there for the president and what do the republicans think about that? >> depends about what the package looked like. you talked about mark walker. concerns about how you pay for it. sounds like it might be a good vote for doug jones a moderate republican that comes in in a very red state. you don't know what it does to someone like tina smith. we have a lot of democrats up for re-election in swing states on the senate side.

in montana, john tester and joe den -- donnelly. nobody has seen a plan yet. democrats will hold to their guns on something important. a permanent daca fix. that were not willing to go to the mat right before christmas. this outraged people like luis gutierrez from illinois that wanted to force their hand there. but democrats feel like they have a little more leverage come january. at some point they have to address the debt ceiling. that is the most noxious vote that they can take. they have to have a long-term spending bill or maybe infrastructure. >> noxious issues, no doubt. 30 seconds. what about the new faces? you mentioned doug jones in alabama. al franken stepping down. new face there's on the hill. what about that down there?

>> right. tina smith will have to run for re-election in 2018. don't know about doug jones. the person with a lot of power is mike pence, the vice president of the senate. he's broken six ties in this congress. there's only been 260 tie-breaking votes cast by vice presidents. the record was by john calhoun, that broke 31. because of that narrow margin, expect to see more of mike pence in 2018. >> only chad pergram would know that john c. calhoun would know about the record. >> adam is 22. he had 26. >> he's got all the stats. we love him. i'd be remiss if i didn't mention chad. senator john mccain has been ill. we're thinking about him and hoping he comes back strong in january. >> that's our understanding, that he's supposed to come back. everybody has indicated that they think he's going to come back in january. if senator mccain is not able to run, that changes the vote dynamic even more. a very narrow margin.

the health of thad cochran of mississippi. you can see how this even stephen and why vice president providence is a crucial figure. >> a busy guy. merry christmas, chad. >> merry christmas. >> patty ann? >> north korea is calling new united nations sanctions an act of war. new penalties were approved in response to north korea's latest missile launch. the new resolution cuts the amount of oil north korea can bring into the country and cracks down on those smuggling banned items into north korea and demands the return of north korean citizens working outside the country. china is calling for calm. they say nations need to work to lower tensions, not make them worse. david lee miller has more. what are the chinese saying? >> the chinese are saying that the latest resolution is not intended to hurt ordinary

people. you have to keep in mind, china is north korea's greatest ally and neighbor. when it comes to the nuclear and missile program, they did vote with the united states. the chinese morin ministry today called for nations to exercise restrain and make positive efforts on the korean peninsula. the chinese are doing their best to emphasize the price of this resolution that called for and i quote again, not inflicting it adverse humanitarian impact. meanwhile, although the u.n. resolution passed unanimously with not just the support of china and russia as well, north korea is blaming the u.s. for the sanctions. a north korean news reader lashed out at washington. >> we define the sanctions resolutions, rigged up by the u.s. and its followers as a grave infringement on the sovereignty of our public and category reject the resolution. >> the north koreans say that

they consider the sanctions no different from an economic blockade. in unrelated development at the u.n., the new budget for the world organization is calling for cutbacks. nikki haley says the u.s. has negotiated a $285 million reduction from the u.n. 5.4 billion budget. in a statement, the u.s. u.n. mission said the u.n.'s bloated management has been reduced. patty ann? >> david lee, now we have another country, guatemala agreeing to move their embassy to jerusalem after president trump declared the u.s. will recognize it as israel's capitol. what about that? >> gatling -- and israel has applauded the decision. >> israel says thank you to

guatemala. we thank the president of the country and the people for the important decision to move the embassy to jerusalem. we believe that this is a just and correct decision and it reflects also the deep friendship between our countries. >> the palestinians have announced the decision and calling it a violation of international law. the foreign ministry saying ten countries are talking with israel about recognizing jerusalem as its capitol. so far those countries not being named. patty ann? >> david lee miller, thank you. >> budget caps threatening to derail the president's spending plan. if congress doesn't vote to raise the ceiling, what could be on the chopping block? a live report from the pentagon next.

>> president trump has spoken about building up america's military, including pumping billions into the military budget. but he's facing a road block in his fan courtesy of congress. we have more live from the pentagon. hi, lucas. >> president trump signed a $700 billion defense budget. but budget cuts from 2011 remain on the books, potentially robbing the pentagon of billions of dollars. the chairman of the house armed

services committee says both parties in congress are to blame. >> most everybody agrees we have to spend more on defense. you have republicans that want to cut other parts of the budget. democrats want to increase other parts of the budget. so everybody is trying to use the defense budget as leverage for these other things. i think that's wrong. >> congress has approved a short term spending plan to keep the government and the military funding through january 19. unless the caps are removed, roughly $100 billion will be taken away from the military and. trump's goal of rebuilding the military will be in jeopardy. last week, the senate majority leader said 20% of defense cuts in recent years is way too much. >> defense has been harder under the budget control act than domestic programs have. so -- and i think there's an urgency there. >> congressional aides tell me

some of the budget caps won't be amended next month but not completely repealed. patty ann? >> so what is the impact on the military if the cuts remain? >> a few examples. last month, the head of army aviation says his pilots are flying at the lowest level in 30 years. 70% of jets and helicopters can't fly. in the navy, out of 542 super hornet jets, half of them can't fly. according to the head of naval aviation, only 31% are fully commission capable. when the navy deployed three aircraft carriers, planes had to be taken from other training squadrons robbing younger pilots of critical flying time. the air force is 2,000 pilots short and half of the fleet of b-1 and b-2 bombers can fly. 37% of the marine corps heavy lift helicopters can fly, and that's not accounting the 60% of

the helicopters missing. >> if you don't have enough airplanes, you don't have all the airplanes, you're supplying a small number of airplanes, they break more frequently and and then you can't get the parts support, you have a smaller number of airplanes. so you're not getting the hours. last year in aviation, we had a horrible safety year. probably the worst year in ten years. >> price as many troops have been killed in noncombat aviation crashes this year compared to last year. then lawmakers blame the budget cuts. >> patty ann? >> thanks, lucas. president trump is predicting that good republican candidates will win big in the 2018 mid-term elections. some other gop lawmakers apparently are not so sure. pennsylvania congressman charlie dent is working his republican colleagues to be prepared for the worst in his words.

jeff flake says some gop rallies are starting to look like the spasms of a dying party. this after democrats flipped a red seat in alabama. so let's bring in josh. thanks for joining us. >> merry christmas. good to be here. >> merry christmas to you as well. senator jeff flake told abc news, when you look at some of the audiences cheering for republicans, sometimes you say those are the spasms of a dying party. we're appealing too older white member and there's a limited number of them. what is your reaction? >> he has some evidence on his side. we've seen super charged democratic turnout in states from virginia to alabama and leading to the big upset in november with doug jones being elected to the senate. we've seen suburban and independent voters swinging away and supporting democratic candidates in the same states. the big x factor is whether republicans show up to the poll.

many elections in the last year, republicans stayed home or didn't turn out as the numbers we expected them to. republicans are hoping the tax cut bill will energize their party, energize their voters and mitigate their losses. make no mistake, it's -- even republicans acknowledge a small wave and the worst case will be a big political tsunami in washington. >> so you believe the house is more at risk for republicans than the senate? >> that's right. the house is very much at risk. if you talk to republican strategists. they're most concerned about the house because the map is so favor for the republicans. the democrats would have to win seats in west virginia, north dakota, indiana, some of the most republican states on the map that are also held by democratic senators. so the environment is difficult for house republicans and senate

republicans. >> you said the suburbs are moving away from the gop. >> that's right. in every election that we've seen, it's the suburban areas that have swung widely away. ed gillespie was losing parts of northern virginia. it used to bad a swing region in that state. you can see that in alabama, the suburban areas where they went to doug jones. the house map is particularly important as far as the suburbs go. a lot of republicans that have held on for many, many years, the very safe republican seats are in suburban areas. if suburban voters continue to prefer democratic candidates, that could jeopardize paul ryan's hold on the speakership. >> so senator bernie sanders says that democrats right now are mobilized by this anti-trump movement. in his words, what we're seeing

in alabama, virginia, new jersey, states across the country are large voter turnouts. people fighting back, demanding our government represent all of us, not just the 1%. that's what he told cnn. you think that is true? the democrats mobilized by the anti-trump movement? >> there's truth to that. you have a super charged democratic base. the one thing that the democrats have to spoke about, if bernie sanders is the head of the party and those that say bernie sanders is a little to the left and we might support more moderate republicans in 2018. we're ten months away from the mid-terms and democrats have to think carefully if they want bernie sanders as the face of their party or if they want more moderate voices to lead the way. >> you mentioned before the alabama senate seat, senator mitch mcconnell says that was disastrous. this was a deep red state.

the robert mueller thing is unique circumstances. are peopling making too much out of that specific race? >> i think so. there's a civil war taking place between the steve bannon wing of the party and the mitch mcconnell wing of the party, if you will. mitch mcconnell won that civil war. that's going to help republican prospects. that's going to help unite the party going into the 2018 mid-terms. on the other hand, don't just like at alabama. there's other races that have taken place from georgia, virginia, montana where democratic turnout has been energized and the results for republicans have been very concerning. >> all right. thanks, josh for joining us. >> thanks for having me. >> meanwhile, thousands gathering in st. peter square to hear pope francis deliver his annual christmas message and blessing. christians around the world celebrate the birth of jesus. the pope taking a more somber tone warning "the winds of war have blowing around the world". he cited conflicts in the

mideast and africa. kitty rogan has more. what was the message from the pope this christmas? >> well, as he so often does, the pope spoke about the trouble spots around the world. speaking from the balcony of st. peter's square, he spoke about a two-state solution in the mideast. he's playing for peace on the korean peninsula. he talked about the long-running war in syria and the forgotten war in yemen. in the west bank, there was calm. fewer people were out celebrating perhaps put off by the recent clashes that followed the president's announcement to recognize jerusalem as israel's capitol. the pope is surely hoping today the calm we saw today will be repeated and his message about peace will be heeded, ed. >> and how is the british royal family celebrating their

christmas? >> well, the british royal family is very traditional. you can imagine they went to a church service as they usually do on christmas day. what was new today is that prince harry was there with his new fiance, meghan markle. that is the first time that the couple has appeared in public alongside the queen. the queen had a more serious message in her traditional speech. she paid tribute to those affected by terror attacks in london and manchester. she praised both of those cities and talked about visiting the hospitals a privilege. and the queen talked about the third child expected from her grandson, prince william and his wife and of course, the wedding in may of prince harry and meghan markle. >> we'll hear more about that i'm sure. thanks for joining us. merry christmas. >> thank you. >> another royal wedding.

i don't know. i'm old enough to remember a few now. we did lose a lot of famous faces this year from mary tyler moore to roger moore, tom petty, david cassidy. we'll take a look back at some of the celebrities gone but not forgotten. they appear out of nowhere.

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>> california getting ready to legalize recreational marijuana. even as companies fight to get a piece of the pot pie, lawmakers are trying to regulate the entire business. more on that in just a moment. but first, as the years winds down, we're saying good-bye to

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>> california kicking off the new year with legal marijuana.

recreational pot sales set to begin january 1 after californians voted to legalize marijuana last year. some cities including los angeles are not quite ready to go just yet. will carr has that story for us. he joins us live in l.a. hi, will. >> patty ann, looks like it will be a merry 2018 for pot companies in california. there's still a haze lingering over the rules. while sales are expected to boost california's economy, the state didn't finalize its list of regulations until mid november. that left cities to come up with their own regulations. some cities won't grant business licenses until after january 1. >> the businesses will have to bring their businesses up to par to continue in this regulatory frame work. >> we would prefer to have it by

january 1, but january 6 is a target. >> they only needed a couple months to work on it and they got it right. >> then there's the law enforcement side. police departments expect duis to go up and plan to adjust exactly how they're going to test people on the street. >> i think for most of our officers, impaired is impaired. they can see that based on their training and experience. >> it's already illegal to use recreational marijuana in california. depending on what city you live in, you may not buy it for more than a week or longer after the new year, patty ann. >> so what about other states in pots becoming legal in other various forms around the country. >> you have five states where you can recreationally sell marijuana. joining california heading into 2018 is maine and massachusetts. so you're going to have three new states next year. people in those states may be thinking ahead for their christmas gifts next year, patty

ann. >> right. will carr live in l.a. thank you. >> will is getting way out there on the gift ideas for 2018. all right, will. merry christmas. in the next hour, america's news headquarters, we'll head back to sunny south florida where the president is spending christmas with his family. we'll have an update to the top stories of "america's news headquarters."

>> welcome back to "america's news headquarters." i'm ed henry with panty ann brown. while the president is on vacation in florida, he says he will be working very hard in

this christmas break and he's not taking a break from twitter. mr. trump celebrating the passage of the american tax bill and slamming the fbi's deputy director and kicking up controversy in the process. rich edson live with the news in palm beach resort, mar-a-largo. rich, what is happening today? >> good afternoon, ed. not much happening publicly for the president of the united states and the first family. they've been enjoying the christmas at the mar-a-largo estate, which is close to where we are. also, a pretty light day on twitter for the president, which is unusual for this. president. he wished am merry christmas frm him and the first lady. >> melania and i and baron wish you a very merry christmas. >> we see the best of america and the souls of the american

people. >> the president kicked off the holiday last evening when he attended church surfaces at the bethesda by the sea episcopal church where the president and melania were married 12 years ago. >> the president always has the balance the fact of celebrating christmas, but dealing with grim news sometimes, including terror attack in kabul. >> for any president, world events dictate the schedule. that was the case today. the president and the president's aides were briefed to the effect of the terror attack in kabul. several reports that say several people died as a result of the suicide attack on the intelligence head quarters in kabul. the president turning to domestic matters saying what are the achievements of his first year in office tweeting the tax

cut reform bill including alaska drilling and the individual mandate brought it together as to what an incredible year we had. don't let the fake news convince you otherwise. our insider polls are strong. the president and the congressioncongress when they return in january have a host of issues to contend. congress have to deal with the dreamers, people that were brought here illegally by their parents and infrastructure. the white house legislative director told chris wallace on "fox news sunday" that the president will be rolling out a infrastructure plan, something else for congress to do in what officially begins after january 1 as an election year, a mid-term ebb collection year in congress. back to you. >> a lot on the president's

plate. >> mitch mcconnell held a news conference before leaving washington before the christmas break. he called 2017 a huge success for republicans in congress. in the next breath, he cautioned that the gop must back candidates in the mid-term that can win at the ballot box. all of this as congress faces a to-do list in the new year. michael tobin is a former aid to senator chuck schumer. anna sultan is here for the new york assembly. thanks for joining us. >> thank you. >> i'm going to start with you, oz. you have a long list of gop accomplishments. michael will pounce. >> sure. let's start with veterans. we've had four pieces of legislation coming through not just protecting whistle-blowers but adding additional benefits for veterans to get the care that they need. really looking at kind of building our educational

opportunities for vets coming back. i don't think we've had that. the tax cuts in my perspective will directly affect my district. you've got impacts to housing. we've had one bedrooms going from 800 to $2,200 inside of harlem. overall, 70% of single mothers will be impacted by this. they'll be paying less tax. i think moving on from the tax issues, what i would just say look at who we're doing internationally. we have a 55 majority muslim coalition built around saudi arabia. we pushed isis back. so i think we're doing well for his first year in. >> michael? >> i'd say i don't agree with the outcome on the tax reform bill, but i understand it was an accomplishment that the senate republican majority and the white house are proud of. this came together in the last moments of what has been a contention year. so if we want to look at the

whole year from the inauguration through next week, folks got their legs under them just recently. that's appropriate for any new administration and any new legislative leadership. this is rockier and more difficult. looking ahead, the president finally understands that the senate and congress doesn't work for him and the courts don't work for him. congress understands how they should be working with the president. so yes to everything you said about veterans. god bless them. thank them for their service. in this regard, it's been a thin year with a lot of controversy and legislative efforts. the infrastructure bill, big jobs bill and not the aca and the travel ban. not an accomplishment i would stand behind but it's an accomplishment nonetheless. >> i think it's a last-minute move but a powerful move.

i think we'll see the impacts of that next year. europe is clamoring because they're saying with a 21% corporate tax, there's a lot of incentive for companies to expatriate. we'll see more on the tax bill coming through once the paperwork catches up with it. he's got his sea legs in place. infrastructure is coming. i think before they put that on the table, there had to be a lot of discussion. there's grumbles and tests with hyper loops and new technology. we've had -- moved towards the digitization of government and basically replacing old tech systems that have been in place since the 90s. >> sounds good. i don't agree. >> it's already there. >> what about this idea of the two parties cooperate something every president complains he's not getting cooperation from the

other party. we heard it from president obama. the republicans won't work with me. the analysts that say that under trump, it's worse than ever. the democrats are doing this resist movement and refuse to work with him on something even they might agree with. michael? >> the administration started with the jobs bill, perhaps there could have been more bipartisan spirit about something like that. i can't speak for my former boss but starting with something like this instead of the controversies existed would have set a different tone. the opposition is supposed to oppose these things. democrats are looking to build a record going into the mid-term election that they can run on and it's not too soon to talk about 2020. but when we say democrats, it's not one monolithic thing. we have senate leadership and the activists that in some case the tail is wagging the log.

we saw it with the senate candidate in alabama. that's going be driving for candidates on the democratic side. that might not be that electable to the wider population. we'll see. >> and we're seeing that on the republican side as well, a lot of division in the republican party. >> i'd echo the comment. i don't think republicans are a monoli monolith. we're seeing the me too response, you're seeing a lot of seats being abated. i think we'll see more seat vacancies in january. i think we're also looking at for one of the first times since the 1800s, a period that we'll have 40 or 50 seats in heavy battles across the country. so the question is not just necessarily one of what is going to be the commitment of the republican party, but too, it's the issues that americans will be looking for inside of 18 till the early 20s, transportation is huge. the cost of transportation in

this country is almost unbearable in many areas. secondarily behind that, coming up with something that we can work together on related to jobs. that's going to be something that leads to long-term success. the opportunity for president trump to set the stage for 2020. >> never have a second opportunity to make a first impression. it would have been better to start this at the outset. look, to be fair also, i'm not the president's biggest defender, but this is an unexpected win in some regard. so folks needed to get their legs under them and acclimate to a new situation. i'll give a pass for a month or two. could have been better. >> oz, what about court appointments? the supreme court and other judge vacancies. >> supreme court justice gorsuch was a great selection. he will uphold the constitution. we have 73 nominations put

forward. if we can work through the balance in between developing relationships with the democrats as my colleague has said figuring out how president trump and the republicans can move forward. because he's not a politician per se. he's not a hillary clinton. he's a new brand of politician coming forward. >> for sure. >> with new policies that he would like to get through in more of a business manner and figuring out how that will work with congress is something that i think he's done this year. >> we're almost out of time. give michael a quick last word. >> on judges, this is what happens when you have a senate majority and a white house that is nominating judicial options and possibilities that i personally don't approve of. i collections have consequences. i'm not happy about it. this is what is going on. one would have more experience than the recent slate of candidates, one of whom has revealed to be --

>> the viral video. we all saw it. >> you gave me the last one. >> thanks for joining us. >> thank you. >> ed? >> meanwhile overseas, strong words from north korea following a new round of sanctions. more next on this christmas holiday. you can't predict the market. but through good times and bad... ...at t. rowe price... ...we've helped our investors stay confident for over 75 years. call us or your advisor. t. rowe price. invest with confidence. essential for vinyl, but maybe not for people with rheumatoid arthritis. because there are options. like an "unjection™". xeljanz xr. a once daily pill for adults with moderate to severe ra

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>> north korea responding against tough new sanctions. the u.n. took action after north korea test-fired a missile that claims could strike the entire u.s. mainland.

serious stuff. david lee miller live in new york city. what are we hearing from pyongyang? >> today we're hearing that north korea says the very idea that they will give up their nuclear weapons is a pipe dream. a statement from the country's central news agency says if the u.s. wishes to live safely, they have to abandon their hostile policy. the u.s. resolution passed unanimously. a north korean news reader lashed out at washington. >> defined the sanctions resolutionsed rigged up by the u.s. as a grave act of war, violating peace and stability in the korean peninsula and the region and categorically reject the resolution. >> the north koreans say they consider the sanctions no different from a complete

economic blockade. in an unrelated development at the u.n., the new budget for the world organization is calling for cut-backs. nikki haley says the u.s. has negotiated a $285 million reduction from the budget. the un's bloated management has now been reduced. ed? >> another country has agreed to move that embassy to jerusalem. what do we know? >> we're now hearing that guatemala has agreed to move their embassy from tel aviv to jerusalem. it was one of nine countries that voted with the united states against the general assembly resolution criticizing president trump's jerusalem declaration. israel's president sent out a tweet saying guatemala has showed us that they know well

that jerusalem is the capitol of israel. i welcome their decision to bring their jerusalem to israel. we look forward to welcoming you to jerusalem. no word yet when that move is going to take place. a palestinian lawmaker has blasted the decision calling it a violation of international law. according to a published report in israel, the israeli foreign minister says they're talking with as many as ten countries talking about jerusalem as israel's capitol. >> thank you. for more on this, we talk to the senior vice president of research at the foundation of defense for democracies. welcome. we appreciate you coming in, jonathan. we hear this every few weeks, a couple months. the u.n. issues more sanctions. is it enough to stop north korea? >> it's not enough. it's a step in the right direction. the international community is recognizing how serious things

have deteriorated. but i'd say the u.s. sanctions program is a fraction of what we saw at the height of the pressure on the iranian regime in 2011, 2012, 2013. we've got a lot more tools left in that tool box that i think we can pull out to put the squeeze on a the north koreans. i think the real question is whether we can get the international community on board. we're still seeing the russians and particularly the chinese kicking and screaming every time we propose additional measures of pressure. >> let's dig deeper there, particularly with china, jonathan. you put your finger on the real issue. whether china will really help here. president trump in his first year in office has claimed that as an accomplishment. he's opened up a strong relationship with president xi. do you agree with the president? is the door being opened here to a strong partnership that will help us in north korea?

>> the door has been open in the since that there's a dialogue underway and it was the right thing to do. the president understood that was the pressure point, something like 80 or 85% of all trades to north korea goes through china. so china is the lynchpin financially if not more so militarily in terms of keeping that regime alive. so now the question is will the chinese put the kind of pressure on the north koreans that is necessary. my concern here is that the chinese under that if they put too much pressure on the north koreans and the regime collapses, then it becomes basically a country that is aligned with the united states or no longer aligned with the chinese. this is their ultimate fear as they think the long-term competition going on with the united states. >> so you mentioned there's more in the tool box.

and i ran, we crippled their commit. what more can we do? what is left in the tool box to cripple north korea? >> sure. first of all, we need to identify some of the banks that are operating inside china, the front companies that are operating there. actually sanction them. that is a dangerous thing as far as we're concerned when it comes to the chinese. there's a lot of co dependency financially there. we can take a look at the individual sectors with the north korean economy and identify the pivotal companies, the pivotal areas that if we cut them off internationally, that it would hurt them even more. more broadly, we need to cut off their entire oil sector. we need to make sure that they can't use foreign labor anywhere around the world. we need to make them pariahs on the world stage. they're most of the way there. but again, we have more room to run. >> jonathan, as we dissect what

went down in 2017, some of the biggest challenges for president trump, when you look around the world, the fact that north korea as we mentioned has this ability with a missile to be able to reach the entire continental united states, doesn't seem to me there's a bigger -- there's a lot of threats around the world. doesn't seem there's a bigger foreign policy threat for this nation, not just a challenge for president trump than that. >> that's right. and when i talked to folks inside the administration, that's one of the first things that they'll say. they'll note that north korea is kind of job one. after that, it's iran and rightfully so. after that, i think perhaps is some of the challenges that we have with russia and china. north korea tops the agenda across the board. >> no doubt about it. jonathan schanzer, thanks for coming in. >> thank you. >> ahead awe ring in the new

year, we take a look at the biggest stories from 2017. from massive storms to the worst mass shooting in united states histo history. that's coming up.

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>> 2017 almost behind us. it's been a wild year. packed with news from president trump's inauguration to the me too movement. shepard smith has looked back at some of the year's biggest stories. >> in 2017, a new president took office. while powerful men and women came forward to say me too. those stories dominating the headlines in 2017. the year started with a big change in washington. the inauguration of president donald trump. >> the people became the rulers of this nation again. >> the next day, millions protested the new president at the women's marches across the country. the biggest single day of demonstrations in american history. one of the president's first major actions announcing a

travel ban against seven muslim majority countries. after court battles and rewrites, the supreme court led a revamped version take effect while the legal fight continues. the president confronting north korea. after the test firing of its first intercontinental ballistic missile. the north testing it's most powerful nuclear weapon yet, a hydrogen bomb and launching a missile that scientists can hit any point in the united states. in april, the president got his first big win on capitol hill. the senate confirmed justice neil gorsuch. in may, president trump fired jesus christ and that led to the appointment of robert mueller to investigate possible collusion of russia and team trump.

a also in may, a deadly terror attack on an ariana grande concert in london. in june, a shooting at a republican congressional baseball practice outside d.c. the majority whip, steve scalise, the most seriously wounded. three months later, he got a standing ovation as he returned to congress. >> you have no idea how great this feels to be back here at work in the people's house. >> in july, iraq's prime minister announced the liberation of mosul after more

than three years. u.s. forces in syria say they recaptured raqqa, the islamic state's self-proclaimed capitol. charlottesville, virginia bam the scene of deadly protests. people turned out to see the first coast to coast total eclipse of the sun in nearly a century. >> everybody joined together and we experienced everything together. it's nothing that can beat that. >> americans continue to recover from three devastating hurricanes, which hit during the end of the summer. first, harvey slammed into the u.s. as a category four storm causing catastrophic damage to houston and the texas coast. >> we're just beginning the process of responding to the storms. >> next, irma. one of the strongest atlantic hurricanes on record. it slammed florida and the

caribbean with devastating rain. finally, hurricane maria. carving a path of destruction from puerto rico, killing dozens and wiping out power to the entire island. on october 1, o.j. simpson walked free after spending nine years behind bars following a botched robbery in las vegas. just hours later in las vegas, the deadliest mass shooting in american history. 58 people killed and more than 500 wounded when a gunman fired into a crowded country music festival on the las vegas strip. still no word on his motive. just a month later, another deadly mass shooting. 25 people died including a pregnant woman during a sunday church service in southerland springs, texas. it's the deadliest shooting at a place of worship in american history. >> no attack, no act of violence will break our spirit or diminish the faith of the american people. >> in october, the legendary hollywood producer harvey

weinstein lost his job and so much more after dozens of women accused him of harassment, assault and even rape. the accusations helped create the me too movement. women and men came forward with stories about sexual misconduct. high profile actors, musicians, journalists and politicians all caught up in the scandal. democratic lawmakers john conyers and al franken announced their resignations and then there's roy moore and the alabama senate race. women accused him of harassing and assaulting him. more loss the election to doug jones. and then the house and senate passed new tax bills. looking ahead to 2018, the mid-term elections coming up. the whole country waiting to see if voters will reject or reward president trump. we're also keeping a close eye on tensions with north korea and the latist sexual misconduct

accusations. we'll be here for all of it. in new york, i'm shepard smith, fox news. >> think about how grim it was when steve scalise was shot. people didn't think he would make it. three months later, back and going strong. >> incredible. good news there. republicans still divided after losing the alabama senate seat. senator mitch mcconnell says they need to back candidates that can win. steve bannon vows to keep fighting the establishment. up next, our senior producer breaks down what seats are up for grabs next year. from record-setting wild fires including historic flooding in houston, under water after hurricane harvey, a look back at a year of extremely wild weather ahead.

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>> republicans won control of both sides of the capitol building in 2016. but they have since lost one senate seat in the deep red state of alabama. doug jones surprising victory has democrats feeling better about capitalizing on president trump's low approval ratings in the mid-terms.

so let's bring in chad pergram, fox news senior producer on capitol hill. he's tracking the seats where republicans are most vulnerable. merry christmas, chad. >> merry christmas. thanks for having me. >> one of the things you want to look at is the generic ballot. it favors democrats by 13 points. that's staggering. we've had the big landslide elections in 2008. certainly when republicans won control in the house in a huge landslide, we were around 7 to 8 points. 13 points is a lot. how can republicans screw this up? the field in the senate should favor republicans. but mitch mcconnell, the majority leader, is very concerned about the types of candidates that republicans might be nominating. roy moore in alabama is a case study in that. listen to what mitch mcconnell had to say about the types of candidates that could be on the ballot this year for republicans. >> want to nominate people that can win.

because often -- i've said this fairly often, people that win elections create policy and others go home. go to another line of work. so yeah, we're going to be supporting people that can actually win. >> this happened to republicans in 2010 and 2012. there's four names which kind of stick in the crawl of mitch mcconnell, christine o'donnell of delaware, share angle of nevada, you had richard murder dick and todd aiken from missouri. all four were nominated. these are all seats that the republicans thought they could win and they didn't. there's a reason why mitch mcconnell didn't become the majority leader until 2015. those are the years that favored republicans in the senate and they didn't get the senate. took awhile. so this is why mitch mcconnell is very concerned about who they put on the ballot. roy moore is somebody that couldn't win election in a red state like alabama. mitch mcconnell supported luther

strange, the sitting republican senator for a few more days. >> all right. chad pergram, thanks so much for joining us. >> any time. >> well, we're nearing the end of a year that will be remembered among other things for devastating back-to-back hurricanes and the destructive wild fires out west. also, signtists say 2017 could become the second warmest year on record. nasa says this october is the second warmest october in 137 years. fox news senior meteorologist janice dean has a look back at the year in weather. >> from deadly hurricanes to devastating wild fires, 2017 was marked by a host of extreme weather events. january started off deadly in parts of the southeast. more than 80 confirmed tornadoes across georgia, the second outbreak in that start. in february, northern california

receiving its wettest winter weather on record. flooding triggering landsliding killing five. flooding in san jose forced 14,000 residents to evacuate. march was snowy in the northeast. a late season blizzard dumping three feet of snow in some areas. march saw destructive tornadoes in parts of the u.s. one outbreak in the u.s. killing two as twitters hit missouri and illinois. straight line winds affecting new york and michigan. damage costing $2.1 billion. in april, more tornadoes. this time in the nation's capitol. a rare ef 0 twister touching down near dc's tidal basin. the month of may delivering wind and baseball size hail to denver damaging property in what is the most expensive hail storm in colorado history.

2.2 billion in damages. may also seeing historic flooding in missouri and illinois. 20 people were killed. in june, 12 states affected by severe hail and wind damage from wyoming to new york. minnesota was hit with damage to buildings and cars. this summer, an active atlantic hurricane season. 17 storms, including six major hurricanes. among the biggest, hurricane harvey in late august. inundating texas and louisiana with water and costing $200 billion in damage. just days later, an early september. hurricane irma roared ashore. a catastrophic storm responsible for 130 deaths. didn't stop there. september went on to be the most active month on record for atlantic hurricanes. towards the end of the month, another deadly storm. hurricane maria devastating

puerto rico. destroying homes and knocking out power across the entire island. beyond hurricanes, the fall was the warmest ever in parts of new england. in florida, california and the southwest. this september through november, marking the warmest period on record in more than a dozen cities, including maine, miami, florida and san jose, california. by october, deadly wild fires were hitting california killing 40 people. the blaze consuming more than 325 square miles. and destroying at least 5,700 homes and businesses. for the winter ahead, government scientists predicting many americans could get a balmy winter with mild temperatures expected across the south and the northeast. a chance of chillier than normal weather in north dakota. high snow totals a predicted across the northern plains from the rockies to the great lakes. in new york, i'm janice dean.

>> we may be getting more snow. get ready. when we come back, how democrats could affect the president's defense plans and how that could affect aging fleets of military aircraft. a live report from the pentagon as the president tries to beef up the military next. growing up, we were german. we danced in a german dance group. i wore lederhosen. when i first got on ancestry i was really surprised that i wasn't finding all of these germans in my tree. i decided to have my dna tested through ancestry dna. the big surprise was we're not german at all.

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tomlinson live there today. merry christmas. big issue coming in 2018. >> that's right. president trump signed a $700 billion defense bill to law earlier this month. the chairman of the house armed services committee blames both parties. >> most everybody agrees that we need to spend more on defense. you've got republicans who want to cut other parts of the budget. you have democrats that want to increase other parts of the budget. so everybody is trying to use the defense budget as leverage for these other things. i think that's wrong. >> the approved short term spending plan keeps the government and the military funded through january 19. unless the budget caps are removed, roughly $100 bill will be taken away from the forces president trump's goal of rebuilding the military will be in jeopardy. the senate majority leader says

defense cuts in recent years are too much. >> defense has been harder under the budget control acts that domestic programs have. and i think there's an urgency there. >> congressional leaders say while the budget caps will likely not be repealed. >> we had a segment about the threat from north korea. the threat from iran. there's obviously always threats around the world. but there's a lot right now heading into 2018. what kind of impact could there be to the u.s. military when you talk about the potential cuts? here's a few examples. the head of army aviation told congress that his pilots are flying at fewer flight hours than any time in the past 30 years. 70% of marine corps jets and helicopters can't fly right now. out of the 542 u.s. navy super hornet jets, half of them are

grounded right now awaiting repairs. according to the head of naval aviation, 30% of mission capable. when the navy deployed three aircraft carriers, planes had to be taken from training squadrons robbing young pilots of flight time. the air force is also impacted. up to 2,000 pilots are still needed. only 37% of the heavy left helicopters for the marine corps can fly and that's not counting 60 helicopters missing on the flight line. earlier this month, the head of the marine corps spoke to jennifer griffin at the reagan library about the shortage of aircraft hurting training. >> if you don't have enough airplanes, you fly more and they break more frequently. so you're not getting the hours.

last year in aviation, we had a horrible safety year. probably the worst year in ten years. >> twice as many u.s. troops were killed this year in noncombat aviation crashes than last year. many lawmakers on capitol hill say these budget cuts are to blame. ed? >> lucas, when you talk about the one graphic saying that 50% of navy jets can't fly, that doesn't sounds like something that can be fixed in a year or two. what are the estimates to rebuild the u.s. military? >> the budget caps known as sequestration away. some air men have been forced to go to a desert scrap heap called

the bone yard to scrounge for parts. says a lot about the military. >> thanks for covering. merry christmas, lucas. >> merry christmas, ed. >> a shakeup at the fbi. fox news has learned the bureau is reassigning their top lawyer. general counsel james baker is being reassigned to a different position. if let's bring in luis nelson from politco. the u.s. general counsel has talked about this. how big is this development? >> it's certainly a significant step, especially to your point like you just said, there are -- the tentacles or the fbi's general counsel of the bureau is likely to be involved in a lot of different investigations to have an understanding of investigations going on, sort of across the bureau. you know, especially as it purchase takens to the nelson.

there's the ongoing russia investigation that is in the control of the special prosecutor. but also related to the hillary clinton e-mail investigation as well. so there's a lot of, you know, the bureau is politicized over the past i guess year dating back all the way into the presidential election last year. so there's a lot of significant investigations that baker is involved in or at least was sort of privy to the details of. >> as we talked about in the intro, sources have told fox that the reassignment has more to do with leak investigations than it has to do with the russia probe. it's just speculation. what might that mean? >> you know, the president has made no secret in terms of how he talks about the department of justice and how he talks about the fbi and i guess the government sort of on a larger

macroscale. he's not a big fan of leaks. that he considers the leaks to be dangerous and considers them especially dangerous coming from the fbi where there's national security implications involved. a move like you said is speculation. but nothing that is sort of targeted about -- targeting with leaks, aim at eliminating leaks, cutting down on leaks would match the way that the president has sort of tried to shape the government and specifically the justice department. >> so we've also learned that deputy director andrew mccabe is eligible for retiring in march. a lot of focus on campaign contributions, that mccabe's wife took. what do you think about that controversy? >> there's a lot of steps to get to to where andrew mccabe is,

you know, seriously -- there's no direct evidence is the clear way to put it that andrew mccabe has acted improperly. but there's a lot of -- there's not quite a fire, but there's been a certain amount of smoke that republicans and defenders of the president have pointed to. one of them are donations to mccabe's wife when she ran for a seat in the virginia state legislature. that money came from the political action committee run by terry mccauliff, things like that. those donations came before the deputy director would have had any involvement in any sort of investigation related to hillary

clinton. so there's some things -- a point there, but also -- there's not a smoking gun or anything like that. >> president trump has certainly been vocal about the fbi and about mccabe in his tweets for sure. >> yeah. >> helpful? >> well, i guess that probably depends who you ask. a lot of people that would say the president's twitter habit in general is not helpful, including i suspect some people -- certainly some people in his own party and the republican party and i suspect if you were to attach people to a lie detector in the white house, they would say the president's twitter habit is not always helpful. but in this case it breaks with a tradition of the west wing and the white house sort of not interfering with the justice department. >> thanks, louis.

>> thanks very much. >> and part of the president's refugee ban has been lifted and why the supreme court will have the last word on this issue next.

>> a federal judge dealing a blow to the president's restrictions on refugees. let's bring in doug byrnes, a former federal prosecutor. merry christmas. thanks for coming in. >> happy holidays. >> i wonder, what is -- this is 3.0 of the travel ban? >> the third one. >> what should we know about this development? >> this has basically been a separation of powers tennis match. the executive branch issued the order. the first shot over the net. back came a court ruling inv vv -- invalidating it. and then the second one. now we are on a third. the ninth circuit, seattle and the fourth circuit, virginia, both have pending cases. the supreme court on december 4 said a, everything is being stayed. the ban can stay in place.

that's why this latest decision doesn't have a lot of practical significant. the ban remains. but the supreme court said once the ninth circuit and the fourth circuit are done in evaluating the case, they insinuated they'll hear the case. that's what will happen. >> how soon will the court deal with this. >> mid-term. the arguments are interesting. >> what is the best argument for the president? we heard about what this judge in seattle thinks. who will they do to get it overhead? >> the overhead smash. no, i mean, you know, he has been -- the administration i should say has been saying national security, the safety of americans. and truth be told, they have overplayed that. in the ninth circuit opinion, they made a sarcastic reference. national security is a phrase. but their best argument, and you've heard many say this, the

applicable statute in the immigration laws gives the president wide authority to do this type of thing. what the ninth circus said is the president didn't make an adequate showing case by case that particular people that were going to come into the united states posed a threat. but the authority is broad. >> when you hear about someone being here because of a family member. we say this attempted terror attack a couple weeks ago hear in new york city and we understand the terrorist was here because of chain migration. >> you know, i'm giving you the legal analysis. you can't avoid the politics of it. so your point is an excellent one, ed. that is that many on the right say well, just because somebody purports to be a family member or have a job or something to do with the university or education, that doesn't mean that people are committing fraud again. it's a case by case basis. if somebody legitimately is part

of a family, nobody wants to break apart families. if they're certain fraud and misrepresentations, that's a different discussion. >> we'll look forward to seeing that soon. >> thanks, doug. >> my pleasure. >> that does it for us here on america's news headquarters. wish you a merry christmas. >> merry christmas, every one. take care. liberty mutual saved us almost

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>> so this is the bill right here and were very proud of it. it's going to be a tremendous thing for the american people. it's going be fantastic for the economy. >> will it be the gift that on given? for your christmas to you and your family at home. this is a special edition of your world. president trump signing that when the half trillion dollar tax cut into law just in time for christmas. but it still may take some time until you start to feel it. of the fox business network gerri willis with all the details. >> passed both o