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Pelosi Challenged for Minority Leader Job; Trump Cabinet-in-Waiting; Right-Hand Man; Education or Indoctrination?; Clapper Out; Interview with

SPECIAL-REPORT-WI-01

REPORT-WI-01

Right-Hand Man; Education or Indoctrination?; Clapper Out; Interview with

Rep. Devin Nunes; Obama on Democracy; Battle for Mosul; Presidential

Elections Effect on Farm Labor Examined; Trump Continues Meetings with

Possible Cabinet Members; Nancy Pelosi Faces Possible Challenge for

Minority Leadership in House of Representatives - Part 1>

Jeunesse, Catherine Herridge, Kevin Corke, Greg Palkot, Dan Springer>

Nunes>

Affairs; Middle East; Terrorism; Economy>

BRET BAIER, FOX NEWS CHIEF POLITICAL ANCHOR: This is a Fox News alert. I'm Bret Baier in Washington.

We will have all the latest news on the Trump transition process for President-Elect Trump in just a moment.

But first, there's some news on the Democratic side of the House. There might be some changes, some signals for House Democrats -- a change perhaps coming. The headline here, Minority Leader Nancy Pelosi is being challenged by a relatively little-known Ohio congressman. So what does that mean?

Let's get the latest from chief congressional correspondent, Mike Emanuel on Capitol Hill. Hi -- Mike.

MIKE EMANUEL, FOX NEWS CHIEF CONGRESSIONAL CORRESPONDENT: Bret -- good evening.

Ohio Democrat Congressman Tim Ryan is challenging Nancy Pelosi saying Democrats will never be the majority party if they only win New York and California. Ryan's letter to colleagues saying, quote, "Under our current leadership, Democrats have been reduced to our smallest congressional minority since 1929. This should indicate to all of us that keeping our leadership team completely unchanged will simply lead to more disappointment in future elections."

Ryan sounded like he was ready to challenge Pelosi in an interview with Fox yesterday.

(BEGIN VIDEO CLIP)

REP. TIM RYAN (D), OHIO: Well, I don't know if I'm the solution. But I think we need to have the conversation about who may be the solution. And maybe it's Nancy Pelosi, maybe it's not.

(END VIDEO CLIP)

EMANUEL: Since returning to Capitol Hill Pelosi has been chased by reporters asking her about her future. She said the problem in this election was at the presidential level and not with her. Pelosi has been a party leader for more than a dozen years and yesterday fired a warning shot saying to colleagues she has the support of two-thirds of the Democratic caucus. Today, Pelosi acknowledged the tension with her members.

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D-CA), MINORITY LEADER: There's a lot of unease. I don't see anything about what is being suggested now as anything but the friendship of all of us. We are family. I never said unanimity, but I did say unified. And I know we will be.

(END VIDEO CLIP)

EMANUEL: Leadership elections were supposed to be held today. They were bumped back. Now, Congressman Ryan has about two weeks to make his case to be the next Democratic leader -- Bret.

BAIER: Mike Emanuel, live on the Hill. Mike -- thank you.

Now to the transition. The Trump Tower looks a lot like the scene of a job fair tonight. Perspective candidates for major positions in the Donald Trump administration are coming and going at a rapid pace there as the President-Elect seeks to put together his first cabinet. And a very familiar name is being discussed at least for a very big position.

Correspondent Doug McKelway is outside Trump Tower tonight. Good evening - - Doug.

DOUG MCKELWAY, FOX NEWS CORRESPONDENT: Good evening -- Bret.

And the biggest sign yet that President-Elect Donald Trump is trying to reach out to his former detractors, the transition team announced that Mitt Romney will meeting with Donald Trump this weekend at the Trump National Golf Club in Bedminster, New Jersey. Apparently, Romney is being considered for the secretary of state job. Sometime after that, Trump will embark on a cross-country tour.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: We're working on a victory tour now.

MCKELWAY: The President-Elect planning to visit those states that helped him secure a win for the White House. And in another sign of healing, Trump is playing host to his first meeting with a foreign leader, Prime Minister of Japan Shinzo Abe, one whose feathers candidate Trump often ruffled.

DONALD TRUMP (R), U.S. PRESIDENT-ELECT: Here's the thing, with Japan they have to pay us or we have to let them protect themselves.

MCKELWAY: While campaigning, Trump often threatened to yank U.S. military protection of Japan unless it contributed more to its own defense. He has accused Japan of manipulating its currency. And he opposes the TPP which Japan supports. But Prime Minister Abe, one observer noted, knows how to approach, quote, "strong men". He is on a charm offensive writing of Trump's quote, "extraordinary talents" in a congratulatory message.

UNIDENTIFIED MALE: The President-Elect has met now or spoken with 32 world leaders. He continues to make sure that he listens to them, hears their concerns.

MCKELWAY: And while it seems Mr. Trump is moderating his often aggressive tone, his predecessor during his joint press conference in Germany suggested why.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I think the President-Elect is going to see fairly quickly that the demands and responsibilities of a U.S. president are not ones that you can treat casually. And that in a big, complex, diverse country, the only way that you can be successful is by listening and reaching out and working with a wide variety of people.

UNIDENTIFIED MALE: It's a great transition.

MCKELWAY: There was another cattle call at Trump Tower today --

UNIDENTIFIED MALE: Sir, would you like to serve in this administration?

UNIDENTIFIED MALE: Well, I would be honor to be considered.

UNIDENTIFIED MALE: Are you moving to Washington?

MCKELWAY: -- with a who's who of movers and shakers making their way in to see the President-Elect.

SEAN SPICER, REPUBLICAN NATIONAL COMMITTEE: World leaders, people who are visionaries, people who have gotten things done -- Fred Smith, Nikki Haley, Secretary Kissinger, Senator Jeff Sessions, Admiral Mike Rogers -- these are people at the top of their game.

MCKELWAY: And the transition team continues to push back hard against those reports of disorganization.

ANTHONY SCARAMUCCI, REPUBLICAN FUNDRAISER: I have been in on these meetings. I'm on the executive committee. And what we're seeing is a very orderly group of people working on behalf of the American people.

(END VIDEOTAPE)

MCKELWAY: Aides announced another step forward today with the formation of landing teams. These are people with special expertise in government agencies who will be popping in to Washington to build a Trump framework there. The first to descend on Washington will be the national security team. They will be making visits to the Department of Defense, the Department of Justice, the State Department as well as the National Security Agency.

Bret -- back to you.

BAIER: Doug McKelway, outside Trump Tower. Doug -- thank you.

Vice President-Elect Mike Pence says the Trump administration wants to work in concert with Congress. How that works in reality will, of course, be revealed after the inauguration.

Tonight, chief legal correspondent Shannon Bream looks at how the Vice President-Elect is handling his new duties and what we can expect when he takes office.

(BEGIN VIDEOTAPE)

MIKE PENCE (R), U.S. VICE PRESIDENT-ELECT: We're excited about moving the Trump agenda forward in the coming Congress. And I'm just so grateful.

SHANNON BREAM, FOX NEWS CHIEF LEGAL CORRESPONDENT: Vice President-Elect Mike Pence will play a critical role in building a bridge between the politically inexperienced President-Elect and the Capitol Hill lawmakers he will have to work with in order to get his ambitious legislative agenda moving.

Today Pence dropped in on Hill power players from both sides of the aisle - - Republican Speaker Paul Ryan and Senate Majority Leader Mitch McConnell; and Democrat incoming Senate Minority Leader Chuck Schumer and House Minority Leader Nancy Pelosi.

PENCE: We're beginning to discuss areas that we might move forward on together. And I think that's what the American people want us to do is find a way to revive our economy, improve American lives, enhance the security of this nation.

BREAM: Trump insiders say he trusts Pence as evidenced by his lead role in the transition.

NEWT GINGRICH (R), FORMER HOUSE SPEAKER: I think he has been given a substantial ground of authority to help make things work.

BREAM: Pence is expected to be less of a Vice President LBJ to President JFK, relegated to funerals and diplomatic events; and much more of a Vice President Cheney to President George W. Bush, highly involved and independent.

LEE EDWARDS, HERITAGE FOUNDATION: He may be one of the best prepared Vice Presidents that we have had in modern times.

BREAM: Not only is Pence currently the governor of Indiana, he also spent 12 years in the House, eventually becoming chairman of the House Republican Conference. He is also got a law degree and once worked as a radio show host.

EDWARDS: And then when you add to that his personality -- Mike Pence is from the Midwest, he is low key, he is intelligent, he is unflappable.

BREAM: Today Pence talked about how humbled he was to return to the Hill. His visit sparking Twitter selfies like this one from House Republican Conference chair, Congresswoman Kathy McMorris Rogers. "Great having Mike Pence visit today. I'm excited to work with him and @RealDonaldTrump to shake up the status quo in Washington, D.C. #MakeAmericaGreatAgain."

(END VIDEOTAPE)

BREAM: Mr. Pence has officially signed the memorandum of understanding that will now allow him to receive additional briefings, the document that was necessary to move forward with the legal transition process -- Bret.

BAIER: Shannon -- thank you.

Donald Trump's election has elicited displays as we have seen of hatred rarely seen in many areas of society, not normally associated with politics -- case in point tonight, a California school district that is portraying the President-Elect in most unflattering terms.

National correspondent William La Jeunesse has the story from Los Angeles tonight.

(BEGIN VIDEOTAPE)

UNIDENTIFIED FEMALE: I just don't think that Donald Trump is fit to run our country.

WILLIAM LA JEUNESSE, FOX NEWS NATIONAL CORRESPONDENT: (inaudible) attends a San Francisco public school where teachers have a new lesson plan written by instructor Fakhra Shah who says her goal is for students to gain a working knowledge of American racial violence and its anti-racist, anti- sexist, anti-Islamophobic, anti-homophobic history.

FAKHRA SHAH, TEACHER: We should all take a stand and we should create spaces in our schools and in our communities where students can have their voices heard.

LA JEUNESSE: And she says don't side step the fact that a racist and sexist man has become the President by pandering to a huge racist and sexist base.

UNIDENTIFIED FEMALE: I don't think he respects anybody of color.

UNIDENTIFIED MALE: There are a lot of things I would like to say about Donald Trump. I just want to say that I'm not scared of him.

LA JEUNESSE: Trump has had his fair share of controversial statements. But critics say there's a fine line between education and indoctrination.

UNIDENTIFIED FEMALE: This type of fear-mongering and demagoguery should not be conducted with public funds.

LA JEUNESSE: The course not required but was endorsed and distributed to the district's 6,000 instructors by the teachers union.

LITA BLANC, SAN FRANCISCO TEACHERS UNION: As educators, we -- our first impulse is to provide the children with a safe space in which to deal with their feelings and make sense out of the world.

LA JEUNESSE: The plan says students might curse and swear but you would, too, if you have suffered under the constructs of a white supremacy or experienced sexism. So make sure to validate feelings by saying, "I hear you and you are right and this is unjust".

As for students with a different point of view?

UNIDENTIFIED FEMALE: That child is going to get teased and taunted by his classmates or even his teacher if this is the message coming from the teacher's podium.

LA JEUNESSE: Shah disagrees.

SHAH: If they're for Trump, they are welcome in my class to say why they are for Trump.

(END VIDEOTAPE)

LA JEUNESSE: District officials could not say how many teachers are using the lesson but have no plan to remove it. As for additional teaching materials, Shah recommends Michael Moore's movie "Trumpland" -- Bret.

BAIER: William -- thank you.

The Secret Service says it has seized $30 million in counterfeit money in Peru -- U.S. dollars. Operation Sunset is said to be the largest such seizure in agency history. More than 1,500 Peruvian national police officers were involved, 48 arrests were made. The service says six counterfeit plants were suppressed, eight manufacturing presses taken and more than 1,600 printing plates and negatives found.

President Obama's top intelligence official will not be staying on in the new administration. The Director of National Intelligence made what is apparently his final appearance in front of one key committee today just hours after turning in his resignation.

Chief intelligence correspondent Catherine Herridge has the story.

(BEGIN VIDEOTAPE)

CATHERINE HERRIDGE, FOX NEWS CHIEF INTELLIGENCE CORRESPONDENT: The Director of National Intelligence James Clapper has openly discussed his plan to leave government at the end of this administration. And today, he made it official.

JAMES CLAPPER, DIRECTOR OF NATIONAL INTELLIGENCE: I submitted my letter of resignation last night which felt pretty good.

HERRIDGE: Clapper's exit comes as the threat from lone wolf attacks like the recent plot in New York City and New Jersey has never been greater.

CLAPPER: That is a very complex problem. It requires, I think, first and foremost community involvement.

HERRIDGE: Clapper was also pressed on some of the Obama administration's signature foreign policy initiatives. Despite the agreement brokered by Secretary Kerry, Clapper said Iran's nuclear and missile development programs are still moving forward.

CLAPPER: I can't say that Iran's behavior has changed.

HERRIDGE: On the election-related hacks designed to influence voters, Clapper said the decision to publicly blame Vladimir Putin's government was not taken lightly.

CLAPPER: We gave considerable thought to diming out Russia with that statement.

HERRIDGE: And Clapper said the FBI director's decision to reopen and then close the Clinton e-mail investigation days before the election was justified.

CLAPPER: Whatever actions he took, he did so in what he felt was best. And I have no basis for questioning that.

HERRIDGE: As for the flawed 2014 ISIS intelligence that painted a rosy picture of administration progress, one lawmaker emphasized no one has been disciplined.

MARCEL LETTRE, DEFENSE UNDER SECRETARY FOR INTELLIGENCE: We are not able to take authoritative, personnel-related actions on these instances and allegations until the IG investigation is done.

REP. MIKE POMPEO (R), KANSAS: I have to tell you that the American people, our soldiers and sailors and marines deserve not to wait two years to hold accountable folks who put bad information in the field.

HERRIDGE: And in a pointed line of questioning, the committee chairman pressed witnesses on why the Defense Department cribbed Wikipedia to justify the location of a controversial intelligence base.

REP. DEVIN NUNES (R), CALIFORNIA: I'm just alarmed, Secretary Work, that we would rely on Wikipedia a free online encyclopedia that's famously known for most high school students plagiarizing their homework.

ROBERT WORK, DEFENSE DEPUTY SECRETARY: I would say that I'm surprised that this comes directly from a Wikipedia page.

(END VIDEOTAPE)

HERRIDGE: As the President's principal intelligence adviser, DNI Clapper oversees the 17 intelligence agencies with more than 50 years of military experience. Clapper's exit leaves a void underscoring the importance of a smooth transition and timely appointments by the President-Elect -- Bret.

BAIER: Catherine -- thank you.

HERRIDGE: You're welcome.

BAIER: Let's talk more about who might replace Clapper, other top intelligence spots in a Trump administration with the chairman of the House Select Committee on Intelligence, Devin Nunes. He is also a member of Donald Trump's transition team. Thanks for being here, Mr. Chairman.

NUNES: It's good to be with you -- Bret.

BAIER: That was quite something, that Wikipedia mention at the end of Catherine's piece.

NUNES: Yes. It's embarrassing. I mean this is part of the problem I think that -- why Donald Trump won, because there's incompetency at every level. I mean even at the Department of Defense, which, you know, I think the American people trust the Department of Defense. But if they're using Wikipedia to justify billion-dollar decisions, there's a big problem.

BAIER: Do you think Clapper did a good job?

NUNES: Look, I won't blame Clapper -- he served for 40 years -- a lot of that time in uniform. I think his problem has been the last few years, because the administration -- that's really who he serves, I think which caused him the most problems because they put him in almost impossible positions trying to defend an administration that had a policy that was lead from behind.

And so he consistently would try to I think -- I don't want to say -- not answer questions but find ways to not answer questions. And I think he got himself into trouble. But with that said, I mean look, the guy had a long, good career. He did a great job in many cases. I think these last few years have been tough.

BAIER: You are on the Trump transition team. You have been publicly talked about as a possible director of CIA, Director of National Intelligence. Would you do that?

NUNES: Yes. Well, I've told them that -- first of all, I have not been asked. But I agreed to serve on the executive committee with the understanding that I was not going to be asked for any other position.

I'm happy where I'm at. My family lives in California. And I just think it would be a really tough, tough sell for that.

BAIER: Those are important positions. You have some names of people who might be considered?

NUNES: I do. I think you have seen a lot of them that have been going into Trump Tower over the last few days. It's quite an organized process. It's been interesting to be involved in this. To see somebody from outside of government come in and kind of bring a business mind to this.

What Donald Trump did right away was put together an executive committee. He is working out of New York now. I think they will gradually start to transition down to Washington here.

But what they're using me for, which I have been very impressed with, is they asked me if I know someone, would I call that person, would I recruit that person? And I have done a lot of that. And I have really enjoyed it.

BAIER: Representative --

NUNES: It just would be totally inappropriate for me to give you names --

BAIER: How about I will give you names? Representative Pompeo.

NUNES: Pompeo would be a great choice for a number of positions. He serves on the intelligence committee with me. He is a West Point graduate. And I think he would do a fine job for this nation.

BAIER: Pete Hoekstra.

NUNES: Pete Hoekstra was chairman of the intelligence committee for a long time. Also I think he has been with Donald Trump -- spent a lot of time with Donald Trump. I'm not sure if he's interested or not. But I know that he is a quality guy.

BAIER: Is he going to have problems filling some of these top spots?

NUNES: No. This is what -- the press keeps reporting this. It's absolutely ridiculous. I don't have -- my phone is ringing off the hook with people who are volunteering. I think the folks that are going to have trouble with this are the people who for the most part were trashing Donald Trump and never tried to help Donald Trump.

And you know, there's some good quality people that probably won't be in this administration, but it's going to give opportunities to younger people and people who have been waiting in the wings, kind of below this kind of Acela Corridor-Beltway problem that we have around here.

BAIER: What are three biggest threats that President Trump will face?

NUNES: Actually, I always say there's five. And I will do it really quickly. But you've got the jihad problem which is ISIS, al Qaeda, et cetera; the China -- growing power of China, their expansion all over the globe; the Russia problems; then you have the counter (ph) proliferation problems, which are the crazy cats, which are Iran, North Korea and others; and then surrounding all of that are the cyber problems which at any given time, cyber can blow up in our face for all of those issues. And then -- so those are kind of the top five to me.

BAIER: And of those, is there one that --

NUNES: I don't think you can -- I don't think you can say one is more important than the other because I think all five on any given day can all be a big problem.

BAIER: Lieutenant General Mike Flynn is reported to be considered for national security adviser. I know you worked with him as he was the head of DIA -- your thoughts about that possible appointment? Hasn't happened yet, but we're getting indications that it may.

NUNES: He is one of the best leaders in the military and military intelligence that I have ever worked with. I first met him when he was in Iraq, head of intelligence for JSOC there, which was one of the -- probably in our history of military and warfare was the largest killing machine ever assembled. That helped us to win the war in Iraq, to bring al Qaeda to its knees.

If you look at the teams that he has been able to assemble over the years, he has been one of our most successful military intelligence officers in modern history.

BAIER: There's some controversy that he signed up Turkey as a client for his consulting firm -- this is the "Daily Caller". "An intelligence consulting firm founded by retired Lieutenant General Michael Flynn, Donald Trump's top military adviser was recently hired as a lobbyist by an obscure Dutch company with ties to Turkey's government and its President Erdogan."

He didn't reveal this when he wrote this op-ed about Turkey, that they need the U.S. support and that Washington is essentially harboring Turkey's -- Osama bin Laden in his words this cleric that Turkey blames for possibly leading the coup? Concerns about that obviously, his appointment as NSA wouldn't be -- need to be senate confirmed. But your thoughts on this and the criticism that he is taking.

NUNES: Well, Turkey -- well, first off, when people are out of -- you know, not in government, they represent foreign governments such as -- that's how it works here. And he is a quality guy. And people would want to hire him.

As it relates to Turkey, we ought to remember Turkey is a NATO ally. And they are a problem child. Erdogan has caused a lot of problems. There was a coup there. We don't know exactly who was behind the coup.

But what I would do if General Flynn gets into one of these positions, he would need to look closely at the intelligence and then to, once he has all the intelligence, kind of determine whether or not that would be the right decision. He can always -- you know, with more intelligence, he could change his position or he may be right and we just don't know that.

BAIER: Mr. Chairman, we appreciate your time. Come back when you can tell us about some more people.

NUNES: Thank you.

BAIER: Thank you.

Up next -- President Obama making a habit out of talking to the media about the President-Elect.

(COMMERCIAL BREAK)

BAIER: President Obama continues to pile up serious face time with the media during his farewell international tour. The President teamed up with Germany's chancellor today for his third news conference of the week. And once again, the main topic of conversation was his soon-to-be successor.

Correspondent Kevin Corke shows us what happened from Berlin.

(BEGIN VIDEOTAPE)

KEVIN CORKE, FOX NEWS CORRESPONDENT: It was both a reminder and a warning.

OBAMA: Democracy is hard work.

CORKE: Standing alongside German Chancellor Angela Merkel, President Obama today said the recent political shock waves to hit the U.S. and Europe should serve as a cautionary tale to never take democracy for granted.

OBAMA: Because we have lived in an era that has been largely stable and peaceful, there is a tendency to assume that that's always the case. And it's not.

CORKE: On what is expected to be his final overseas trip as president, Mr. Obama and Ms. Merkel spent much of their news conference fielding questions about President-Elect Donald Trump. Earlier in the day, in an apparent nod to fears here of increasing U.S. isolationism in a Trump administration, the two leaders penned an op-ed in a German daily writing quote, "Today we find ourselves at a crossroads. The future is upon us. And we will never return to a pre-globalization economy."

TRUMP: Germany is a disaster now.

CORKE: During the presidential campaign Trump was a frequent critic of Merkel's policy on Syrian refugees. He even took to Twitter to take a shot at "Time Magazine" for naming Merkel 2015 person of the year, tweeting, "I told you `Time Magazine' would never pick me as person of the year despite being the big favorite. They picked person who is ruining Germany."

But today Merkel shook off the criticism noting that the deep ties between the two countries would endure.

ANGELA MERKEL, GERMAN CHANCELLOR (through translator): That is in our mutual interest so we will continue this. We will approach this with an open mind. And we'll do this on the basis of deep conviction with President-Elect Donald Trump.

CORKE: And while the President said he remained cautiously optimistic about his successor, he challenged Mr. Trump to stand up to Russia when they deviate from universal values and international norms.

OBAMA: My hope is that does he not simply take a real politic approach and suggest that if we just cut some deals with Russia, that we just do whatever is convenient at the time.

(END VIDEOTAPE)

CORKE: Bret -- Friday, the President's schedule will expand just a bit to include meetings with Eurozone leaders from France, the U.K., Spain and Italy. Of course, that's all just ahead of his trip to South America for the Asia Pacific Economic Cooperation summit in Peru. And no doubt, trade will top the agenda there -- Bret.

BAIER: Kevin Corke, traveling with the President in Berlin. Kevin -- thank you.

U.S. officials tell Fox News, Russia has launched long-range bombers from a base in southern Russia for the first time in a year. We're told the planes fired cruise missiles into Syria.

Meanwhile the Russian military says it killed at least 30 members of an al Qaeda-link group during an air strike in northern Syria this week. The statement claims some of the organization's leaders are among the dead.

Poor weather and cloudy skies are hampering the advance of Iraqi Special Forces into ISIS-held parts of Mosul. But there is progress being made and some of the people who were terrorized under ISIS rule are now doing better.