Transcript for White House warns shutdown could last into 2019

We are turning now to Washington and the government shutdown entering day three this morning. The white house warning it could stretch into the new year as the president and Democrats battle over funding for the border wall. ABC's Tara Palmeri has more. Reporter: This morning, the government shutdown entering its third day with no end in sight. The hallways of capitol hill empty after gridlock lawmakers left negotiations until after Christmas. The president's new acting chief of staff says the shutdown could creep into the new year. This is what it looks like when you have a president who refuses to go along to get along. Reporter: While insisting president trump will stand his ground on a border wall, behind closed doors, the white house is backing down from its original demand of $5 billion for a wall along the u.s./mexico border. The discussions now are between $1.6 billion and $5 billion. Reporter: Chuck Schumer also lowered his original offer of 1 point of billion dollars in border security to $1.3 billion. Allies say they are going in the wrong direction. If I wrote a book called "The art of the deal," I don't think I would take an offer of $1.3 billion when you previously offered me $1.6 billion. Reporter: As for that headlining campaign promise -- I will build a great, great wall on our southern border, and I will have Mexico pay for that wall. Mark my words. Reporter: Mulvaney now acknowledging the money to fund the wall won't come from south of the border. The department of homeland security can't actually spend money from Mexico. We have to get it from the treasury. Reporter: And here's some more shutdown drama. On Friday night, a man climbed the national Christmas tree here in Washington, D.C., destroying the lights, but the tree can't be fixed before Christmas because the government is shut down, and that includes the national park service. Dan? Tara, thank you.

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