Skip navigation

'The Rachel Maddow Show' for Wednesday, February 11

Read the transcript to the Wednesday show

Guest: Barney Frank, Jeffrey Sachs, Sam Stein, Kent Jones

RACHEL MADDOW, HOST:  Thank you at home for staying with us for the next hour.

Congress makes a deal to stimulate the economy.  It seems a little anemic to me.

Economist Jeffrey Sachs will be here to try to Talk Me Down because I need it this time.  Richard Engel will join us this hour live from Baghdad with a first look inside the new ginormous U.S. embassy there.  And Sam Stein from the “Huffington Post” will join us during what has probably his best week as a journalist ever.  That is all coming up this hour.

But, first, when members of Congress congregated, they form groups they call caucuses.  Now, this is not an alliterative riddle but it‘s hard to say.  I mean, it is that, but it‘s something else, too.  It‘s also how Capitol Hill works.

Some congressional caucuses are famous, like there‘s the Congressional Black Caucus.  You have to be African-American to be a member.  There‘s the Out of Iraq Caucus.  There‘s, of course, the Blue Dog Caucus, the fiscally-conservative Democrats whose repeated meetings with President Obama recently have caused other Democrats to grind their teeth down to nubs.

You know, the single biggest caucus in the House—you might be surprised to hear this—is the Progressive Caucus.  The liberals are coming!  The liberals are coming!

I‘m telling you all this about caucuses in the House for context, because I need to introduce you to the newest caucus in the House of Representatives.  Right now, it is all Democrats and they are calling themselves, the Populist Caucus.

You know, when the history of the U.S. House of Representatives is written and the formation of the Populist Caucus is noted, it will be very important and very obvious why early 2009 was the time that this group was formed.  2009 is the year that this is what passed for entertainment in Washington, the country gathering around congressional hearings to take gleeful pleasure in watching zillionaire banking CEOs squirm.


JOHN MACK, MORGAN STANLEY CEO:  I believe that both our firm, our industry have far to go to regain the trust of taxpayers investors and public officials.

KENNETH LEWIS, BANK OF AMERICA CEO:  But we understand that taxpayers are angry and they deserve to know how their funds are being used.

JOHN STUMPF, WELLS FARGO CEO:  We‘re Americans first and we‘re bankers second.  So, we see this taxpayer investment, first and foremost, as an investment in the future economic growth of our country.

JAMIE DIMON, JP MORGAN CHASE CEO:  All of us who are here today and many who are not here bear some measure of responsibility for the current state of financial markets.

VIKRAM PANDIT, CITIGROUP CEO:  I would like to say something about the airplane that is in the news.  We did not adjust quickly enough to this new world and I take personal responsibility of that mistake.  In the end, I canceled delivery.  We need to do a better job of acknowledging and embracing the new realities.

Let me be clear with the committee, I get the new reality and I will make sure Citi gets it as well.


MADDOW:  If the feeling you get by watching that sort of testimony is something like, yes, finally, these guys are getting taken down a peg.  Oh, it‘s so satisfying to finally the plutocrats have to defend themselves.  Maybe now we can get something done for people who actually have to work for a living instead of everything just always benefiting guys like that all the time.

If that‘s how you‘re feeling that little pugilistic feeling you‘re getting, that feeling is your inner populist waking you up.  A lot of people, maybe even the whole Democratic Party have been getting woken up by their inner populist lately.  In the 2006 midterm elections, candidates like Senator John Tester of Montana, Senator Jim Webb of Virginia, Senator Sherrod Brown of Ohio, each won elections that they weren‘t necessarily expected to win in that critical midterm year.

The thing that tied all them together—which bewildered observers who had not noticed the rising populist tide in Democratic politics—was not that they were all in the same place on the left/right scale, it was not that they have the same positions on all the traditional hot button issues, they didn‘t—the thing that united those senators, all those guys who won, is that they all campaigned as economic populists, as in “I stand for the little guy.”  As in “the reason I‘m a Democrat, the reason the Democratic Party exists is to represent people who have to work for a living, people who have to take showers after work, not just before.”

And now, the tide that started a long time ago that bewildered the political establishment when it became noticeable in 2006 -- that tide is cresting.  We have a hugely dominant Democratic Party in Washington now and we have a massive economic crisis.  The prevailing winds in the country and in Washington are blowing in a distinctly partisan direction.  You put that all together and what you get is black and white cartoon caricature fat cat villains on whom blame and scorn are now being heaped.


REP. BARNEY FRANK, (D) HOUSE FINANCIAL SERVICES COMMITTEE:  If in good times you were told you weren‘t going to get a business, what part of your job would you not do?  I mean, if you weren‘t getting a bonus, would you leave early on Wednesday or would you take longer lunches?  Why do you need to be bribed to have your interest aligned with the people who are paying your salary?

REP. AL GREEN, (D) TEXAS:  The American people are exceedingly angry.  If they are angry about one thing it is a lack of intelligence as to what happened to the money.

UNIDENTIFIED MALE:  “How dare you,” Judy from Kansas City.  “How big is your yacht?” Michelle.

UNIDENTIFIED MALE:  Frank Krekowski (ph) of Orlando writes, “Put them all in jail.”

REP. GARY ACKERMAN, (D) NEW YORK:  We listen to you and we hear words, words, words and no answer.

REP. MICHAEL CAPUANO, (D) MASSACHUSETTS:  You come to us today on your bicycles after buying Girl Scout cookies and helping out Mother Teresa telling us, “We‘re sorry.  We didn‘t mean it.  We won‘t do it again.  Trust us.”

Well, I have some people in my constituency that robbed some of your banks, and they say the same thing.  Do you understand this is a little difficult for most of my constituents to take, that you learned your lesson?  The problem I have is that, honestly, none of us—America doesn‘t trust you anymore.


MADDOW:  In these congressional hearings with all the Wall Street CEOs having to sit there and take it, they were very emotionally satisfying.  America‘s inner populists are wide awake and well-fed and very happy.

But is this the right way to move forward to come up with the best recovery plan possible and to avoid again making the same mistakes that got us here in the first place?  I honestly do not know.  But it definitely is what‘s happening.  We have got bad guys in this economic crisis.  Do they deserve it or is this just our human nature based search for a simple answer—a convenient villain here?

Joining us now is Democratic Congressman Barney Frank of Massachusetts.  He is chairman of the House Financial Services Committee.  He summoned the CEOs eight of the nation‘s top banks to testify before his committee today.

Congressman Frank, Mr. Chairman, thank you for joining us.

FRANK:  Glad to.  A very important issue.

MADDOW:  These CEOs really got the sharp end of the stick today before your committee.  And I will admit, it was very fun to watch.  Do you feel like their actions, their stupid and self-serving actions, have made our country less able to get out of this economic mess?  If they had been better people, if they‘d been better citizens, would our country be better off?

FRANK:  Well, actually, if they had been better bankers, many of them would have been better off.  The mistakes that were made first, there were financial misjudgments.  In some cases, it wasn‘t they, it was their predecessors.  In some cases, it was the ones who were here.

And they compounded it by not understanding the atmosphere we are in.  I was encouraged by this.  This wasn‘t fun to them today.  It wasn‘t meant to be.  And, you know, I think, every one of them is determined not to go through this again.

And that—they gave us defense of their actions which may, in some cases, have been a little rosier than the reality.  They were selective about it.  But I didn‘t mind that, because when people do that, they are going to be committing themselves to get better in the future.

And there are some very specific things that we got today.  Essentially, we come out of this today, I believe, with a moratorium on foreclosures in much of the country until we get the plan from Secretary Geithner.  And once we get the plan, then anybody who would qualify will qualify.  So, that was very helpful.  We were able to get that.

They basically today acknowledged they get bonuses for nothing.  That is, they get bonuses, but I asked them, “What would you do differently if you don‘t get a bonus?”  They said, “Nothing.”  So, I said, “Fine.  I‘m your efficiency consultant.  Don‘t pay the bonuses.”


FRANK:  They also committed themselves to do more lending.  So, I do think and this is the most important part of all of what we do, we are not the cops.  We can‘t prosecute.  There may be some prosecution, civil or criminal—we need to get them to respond going forward.

And I think, on three critical points, no more abuses in the compensation area, serious efforts to reduce foreclosures and a commitment that when they get federal money, it is relent.  I think we made very substantial progress in committing them to all three.  Now, we also have a new secretary of the treasury who, unlike his predecessor, is going to push those as well.  So, I‘m somewhat optimistic that we are going to see things change for the better.

MADDOW:  On the issue of the possibility of prosecutions, New York State Attorney General Andrew Cuomo reported to your committee that before Merrill Lynch merged with Bank of America, they paid four execs a total of $120 million on bonuses seemingly on a schedule designed to keep it off the Merrill balance sheet, keep it on the Merrill balance sheet, not of B of A one.  Is there something potentially criminal here, do you think?


FRANK:  I don‘t know.  If you read the letter carefully as I did today, he does not say that the Bank of America knew about it.  He raises a question as to whether they did.  It is very disappointing behavior on behalf of John Thaine of Merrill Lynch.

By the way, people should know, John Thain would almost certainly have been John McCain‘s secretary of the treasury.  Phil Gramm was his original first pick but that became too ridiculous even for the man who picks Sarah Palin.  So, his fallback was John Thain.

John Thain appeared from what Andrew Cuomo has said, to have known that Cuomo was looking at this and to have deliberately moved it up so he got it out of the scope of Cuomo‘s investigation.  And I honestly don‘t know—clearly, there were two levels, of course, of the prosecution in effect.  There can be civil prosecutions where people get fined and have to do some disgorgement, as we call it, which is a fancy word for “give it back” or there might be criminal work.

And so, our focus, of course, is neither of those but our focus is on the public policy.  And again, I am encouraged.  When people speak as they do and they kind of clean up their pasts, they‘re acknowledging that they can‘t keep doing what they are doing and we got some very explicit commitments that there is going to be better behavior in the future.

And what backs it up is this, Rachel.  We are not asking anybody to trust anybody.  The Obama administration understands, these bankers and others understand—some of them are from the investment houses—they are going to probably need more resources to get the credit system working.  And they are not going to get them unless there is a very radical change in behavior, unless the promises they made today to be good about composition, to re-lend the money, to stop the massive foreclosures, if they don‘t live up to those and they understand that‘s the end of the road.

MADDOW:  Should they be constrained from doing those things by rules rather than just being shamed for when they don‘t do them?

FRANK:  Oh, there is no question about it for the future.  Well, there is a problem in the American system.  And we, as liberals, should be honoring this.  The principle that you don‘t go back and do things retroactively is a very important liberal principle.

So, some of the things that the Bush administration let them do, we cannot undo.  We can prevent them going forward, and this I can guarantee you.  We will very soon be adopting a set of regulations.  We‘re going to be doing essentially now what Franklin Roosevelt had to do with the New Deal, what Theodore Roosevelt and Woodrow Wilson had to do around the turn in the last century.

There‘s a whole lot of new financial activity that‘s going on that‘s caused some damage and done some good.  But it‘s gone on without rules.  And the one thing I am most confident about is we know how to stop this from happening again, banning the bad subprime loans, restricting the excessive kinds of leverage they‘ve had.  Yes, this is a very high priority for us.

And, I think, by the summer, we‘re going to have a set of rules in place.  It‘s going to be comparable, I think, to what FDR did with the New Deal, with the Securities and Exchange Commission and other rules.  We will not depend on their goodwill.  We will put some tough rules in place.

MADDOW:  Expect that to be quoted frequently as people absorb your message there, sir.

Democratic Congressman Barney Frank .

FRANK:  Thank you.

MADDOW:  . chair of the House Financial Services Committee—thank you so much for your time.  Good luck, sir.

FRANK:  Thank you.

MADDOW:  The House‘s top banking overlord just said, by this summer, he will create new regulations comparable to what FDR did with the New Deal -- right here.  That just happened.  I think we just made some news.

OK.  Also news today, a $789 billion stimulus deal—which is good in

the abstract.  But why it is shrinking?  Award-winning economist Jeffrey

Sachs will be here in just a moment to talk about what should stay in the

stimulus and what should maybe go

And later, from Baghdad, NBC‘s Richard Engel, one of the only journalists to go inside the completely over-the-top, ginormous U.S.  embassy there, we will talk live to Richard from Baghdad.  That is later.

But, first, One More Thing about bad days in Congress for America‘s CEOs.  Today, another House committee questioned the owner of the Peanut Corporation of America.  That‘s the company being blamed for the salmonella outbreak that has sickened 600 people and has been linked to nine deaths.  It‘s responsible for one of the largest product recalls in U.S. history.

What does the company‘s owner, Stewart Parnell, have to stay to Congress under oath today?  Nothing.  Mr. Parnell pleaded the Fifth five times.  Mr. Parnell complained in e-mails that the contamination tests showing his products were infected were, quote, “costing us huge money”—which is presumably why investigators say he shipped out peanut products even after seeing positive salmonella contamination tests.

Congratulations, Mr. Stewart “Plead the Fifth” Parnell.  It is the example of CEOs like you that is frankly uniting the whole country as raging populists.


MADDOW:  Late today, congressional Democrats and their coveted three Republican partners—three in total—announced that they made a deal to pass a plan to hopefully save the economy.  The press conference today, at times, seemed like a sort of economic stimulus compromise awards show—the stimmies.  They did not thank their agents, third grade teachers or the academy.  But the awards show echoes were actually a little bit jarring.


SEN. SUSAN COLLINS, ® MAINE:  I want to thank all of my colleagues who have worked so hard.

SEN. HARRY REID, (D) SENATE MAJORITY LEADER:  It could not have been done without her guidance and leadership as the speaker of the House.

SEN. OLYMPIA SNOWE, ® MAINE:  I‘m very pleased to have been a part of this.

SEN. JOE LIEBERMAN, (I) CONNECTICUT:  I was proud to work this w this group, proud to be part of it.

SEN. BEN NELSON, (D) NEBRASKA:  To all of my colleagues here, I say thank you for the experience.


MADDOW:  Yes, it‘s not just a ginormous piece of legislation; it‘s also a heart-warming story that shows the triumph of team work over adversity.  Two thumbs up, Congress.

Americans who believe in macroeconomics 101 are glad to hear that there is a stimulus deal, a deal that has enough support to pass, to pump some into the demand side of supply and demand, to start getting the economy to work again.  Two thumbs up, right?  That said, looking at what‘s actually in the compromise, what‘s actually in the bill makes my thumbs feel slightly less enthusiastic about what happened today in Washington.

For starters, the stimulus got smaller in the compromise.  The House bill was $820 billion.  The Senate bill was $838 billion.  And the compromise was down to $789 billion.  How is that a compromise?  The math doesn‘t work.

Spending is the point of the stimulus.  The economy is bad because no one is buying anything.  There is no demand in the supply and demand.  So, the way stimulus works is by buying stuff, right?

The CBO says there‘s about a $2 trillion hole in demand in the economy.  Spending $800 billion to fill a $2 trillion hole was probably not a big enough of a plan anyway.  And now, the compromise has made it even smaller?  Hmm!  Thumbs down.

Which much-need billions did they cut from this?  Well, they cut $35 billion in proposed and desperately needed aid to the states.  That‘s to keep states from laying people off and cutting public services, things that will make the economy even worse.  If you throw a dart at a U.S. map today, chances are, you will hit a state with a deficit in the billions of dollars.

The compromise also cuts $16 billions in school construction funds, one of President Obama‘s priorities.  That is a line item that is essentially pure economic stimulus.  If the point is to stimulate the economy, there are no conceivable grounds on which any rational policy maker could argue that reducing the amount of school construction money would make a stimulus plan better.

So why did the plan get worse?  Well, at least there is a passable stimulus, a bill exists.  But does what just got agreed to actually have enough juice left in it after its trip through the wringer of congressional compromise to really save the economy?  I‘m not sure and I‘m not an expert on thee things.  So, I need to be talked down.

Joining us now is Jeffrey Sachs, who is one of the most famous economists in the world.  He directs the Earth Institute at Columbia University.  He advises the United Nations.

Doctor Sachs, thank you so much for coming on the show.


MADDOW:  Can you Talk Me Down about my big worry about the economic stimulus?  Is it big enough?

SACHS:  Well, your worry is right.  No matter what they were going to do, we‘re going to have a very tough year and it‘s actually going to be a tough two or three years.  If we went the whole way to try to offset the collapse of the housing sector and the collapse of consumption, we would have a hole in the budget that we‘d also have to take a decade to repair.  That‘s the problem.

We are going to have a budget deficit this year of probably $1.4 trillion with this stimulus and with what was already there before.  That‘s starting to get up to real numbers.  And if we went bigger and bigger, we might have a few more jobs in the short-term and have a massive fiscal hole that would also really cripple us for the long term.  And that‘s the problem that we face.

There is no perfect solution to the mess that we‘re in right now.  That‘s the hard point.  No one has the tools to solve this problem without a lot of pain.

MADDOW:  That‘s why it‘s so important, though, that what we do spend on stimulus is really stimulative.  It really has the kind of multiplier effect that we‘re looking for, right?

SACHS:  Well, that‘s for sure, true.  And what‘s odd is, you know, we have a hole in the budget that‘s already $1 trillion wide, which is unbelievable.  I mean, we‘ve never had this before in our history.  But there is this drive to cut taxes, cut taxes.

Now, there are two things wrong with that.  One, we can‘t afford it.  And the second is, we know from experience that since people are going to say, “Well, those tax cuts aren‘t going to last, that‘s going to be very temporary, they are going to raise my taxes later on,” the tax cuts are going to be saved rather than spent.

MADDOW:  Right.

SACHS:  So, there are about $350 billion in this roughly $800 billion stimulus that doesn‘t have much stimulus and at the same time, the Senate, these three senators who made the so-called compromise just turned some nasty dials where the money was really needed—really needed by the poor, really needed by the states and cities, really needed by the schools.  And they cut that to raise the taxes which are ineffective and a less fair part of the whole thing.  So, it‘s a little weird actually.

MADDOW:  If you took the tax cuts out, if you dialed back up the aid to states and cities, you dialed back up the school construction funding, you‘ve also argued specifically that in this—in the stimulus, we ought to be directing rescue money specifically to healthcare coverage for uninsured people.  Why is that so economically important?

SACHS:  Well, first of all, it‘s desperately needed.


SACHS:  So, it‘s not just stimulus, it‘s what kind of society we have.  And if we are leaving desperately poor and ill people without access to healthcare, it‘s pretty discouraging what kind of place we‘re living and trying to solve.  So, one thing is, what are we actually doing with the money.  Second thing is, if you want to get confidence back to people, tell them that they are not going to fall through the, you know, right through the floor of the disaster right now.


SACHS:  And so, give them a base, some confidence that we are not going to leave people to suffer massively to their desperation.  And this bill doesn‘t quite do it.  I know that President Obama wants to do it.  He compromised a lot of way on this.

I think it‘s a little bit shocking that we have the shape of this, but what you said is also true.  We have a bill.  It‘s the president‘s leadership that got us here and we ought to be thankful for at least that.

MADDOW:  One last question.  You have been instrumental in the Global AIDS Fund.  When we see these bankers on Capitol Hill talking today about having used billions of taxpayer dollars for bonuses to people who are already very rich—is that a teachable moment do you think about the value of countries spending public resources on rich people versus on poor people?

SACHS:  What Merrill took in bonuses is about what the U.S. gives for all of its help to the world‘s poorest people in Africa and they took that.  They just grabbed that in a moment.

So, now, we have a short fall for AIDS, TB and malaria.  That‘s millions of deaths, life-and-death at stake and these bonuses, that‘s where we got to go.  And I want the administration to say, “Come on, that‘s the money.”  I don‘t want them to say, “We have no more money for dying people.”  We know where the money is.


SACHS:  Let‘s go get it and let‘s .

MADDOW:  We should get it back.

SACHS:  Absolutely.  Come on.

MADDOW:  We should get it back.

Jeffrey Sachs, it is a real pleasure to meet you and to have you on the show.  Thank you for coming in.

SACHS:  Well, thanks so much, Rachel.

MADDOW:  Thank you, sir.

Jeffrey Sachs is the director of the Earth Institute at Columbia University.

You know Ana Marie Cox from Air America Radio and “Daily Beast,” who is sort of a friend of the show here?  She twittered after the last presidential press conference on Monday night that there was a lot of grumbling from the White House press corps on Monday when the president took that question at his news conference from the guy from “Huffington Post”—remember that?

That reporter, the object of much jealous grumbling in Washington is having a very good week.  He will join us in just a moment.


MADDOW:  In just a moment, we are going live to Baghdad where Richard Engel just got a peek at the new U.S. embassy that we built there.  It is 10 times the size of any other American embassy anywhere.  And Richard says it‘s kind of dumpy, actually.  We‘ll join him live in Baghdad in just a moment.

First, though, it‘s time for a couple of holy mackerel stories in today‘s news.  This November‘s election is generally speaking were good for Democrats and bad for Republicans.  But for every “generally speaking,” there are exceptions.

One of those exceptions in November was the race to control the state legislature in the great state of Tennessee.  Democrats had held the majority in Tennessee‘s general assembly since 1869.  That‘s 140-year winning streak—until the election results in November put Republicans up in that chamber, for the first time in 140 years.  Their margin was just 50 to 49.  Now, last month, when it came to swearing in time, the Republicans were very excited about the change in power.  Their choice to be the new speaker of the House, the improbably named Jason Mumpower brought the family Bible to be sworn in on.  He ordered 65 state flags that would be raised on the capitol flagpole and then brought back down and later distributed as souvenirs. 

The Republican Party taking over the House for the first time in 140 years.  They were so excited.  Little did they know their 50 to 49 majority was about to get way more complicated.  A Republican legislator from east Tennessee, a man named Kent Williams, had made a secret deal with the Democrats. 

Mr. Williams caucused with his fellow Republicans right up through that morning of the vote for the speaker.  He had pledged that along with all the other Republicans in that chamber that he would support Mr. Mumpower for speaker.

But then, when the time came to vote for the new speaker, Mr.  Williams instead voted for himself as did all of the 49 Democrats.  The Republicans were screaming “Judas” at him on the floor of the general assembly.  This means that Mr. Williams got 50 votes and the other guy only got 49. 

So the Republicans did not get their guy as speaker of the House even though they technically had a majority of seats in the chamber.  They had a majority of seats in the chamber.  That is no longer true. 

This week they gave up their majority.  The chair of Tennessee‘s Republican Party stripped Mr. Williams of his Republican Party membership, said, “You are no longer a Republican.  We disown you.”  She cited dishonor, deception and betrayal.  Meow. 

Moving east to the state of Virginia, Democrats control the Virginia State Senate 21 to 19.  The Democrats in the Virginia State Senate - they‘re in control.  But it is fragile.  If the party split, shifted in Virginia by just one vote, if it became 20-20 instead of 21-19, then the control of the chamber would flip and that‘s because the state‘s lieutenant governor is a Republican.  And the lieutenant governor casts the tie-breaking vote. 

So if it was 20-20, the control of the chamber would go to the GOP because of that lieutenant governor.  In yet more party-crossing state legislature drama, Republicans almost got that split to happen.  They almost got one Democratic Senator Ralph Northum(ph) to agree to switch sides. 

That would have given Republicans control of the Virginia State Senate.  It might have worked.  It looked like it was going to work.  But then, Twitter struck.  The state Republican Party chairman, a young man named Jeff Frederick posted a Tweet that said this, “Big news coming out of the Senate.  Apparently one dem is either switching or leaving the dem caucus.  Negotiations for power sharing underway.” 

Apparently, Mr. Frederick, genius, didn‘t take into account that he was tipping off the Democrats to the Republicans‘ secret plan.  After seeing his Tweet, the Democratic majority leader adjourned to the chamber before any deal could happen that bought the Democrats time to get their potential Benedict Arnold to change his ever-loving mind. 

Who do you think is the country‘s least popular Republican right now?  The guy who got stripped of his party membership for defecting to the other side in Tennessee, or the guy in Virginia who gave away the Republicans‘ chance at controlling the Senate because he was too excited to stop himself from Tweeting it?  Tough call there.  Tough call.  


MADDOW:  “Time” magazine dubbed it to “Taliban‘s mini-Mumbai.”  In the capital city of Afghanistan, attackers wearing suicide vests successfully carried out multiple simultaneous attacks on government buildings, including the Ministries of Justice and Education in central Kabul, and the Prisons Ministry just outside the city. 

At least 20 people were killed.  More than 70 were wounded.  The Taliban has taken responsibility for the attacks and the Afghan government is blaming Taliban leaders in Pakistan for coordinating the attack. 

This all one day before a visit from President Obama‘s envoy to the region, Richard Holbrooke.  It is actually turning out to be a fairly bloody trip for Mr. Holbrooke.  Before going to Afghanistan, he has been in Pakistan.  When he arrived in Peshawar, Pakistan today, a local politician was assassinated there in a bombing attack. 

Meanwhile, violence erupted again today after a relative lull in Baghdad.  Eighteen Shiite pilgrims on their way to the holy site Karbala for a religious festival were killed in a double car bomb explosion at a bus station in Baghdad - another roadside bombing killing two more, the attacks coming less than two weeks after Iraq‘s provincial elections.  

The results of which sparked threats of violence including assassination attempts against four of the winning candidates. 

As far as the U.S. role in Iraq, going forward, well, NBC News chief foreign correspondent Richard Engel is in Baghdad where he just got a close-up look at perhaps the biggest, most concrete indicator, literally, of the duration and character of America‘s expected involvement there, the massive new U.S. embassy. 

Richard Engel joins us live now.  Nice to see you, Richard. 

Thank you so much for joining us.

RICHARD ENGEL, NBC‘S CHIEF FOREIGN CORRESPONDENT:  Hey, it is my pleasure.  Good morning from still-dark Baghdad.  It is about 5:30 in the morning here.  So, pleasure to join you. 

MADDOW:  Thanks for getting up early.  Richard, what can you tell us about the bombings today in Baghdad, these attacks on the Shiite pilgrims?  

ENGEL:  Not altogether unexpected.  What happened is there are now several hundred thousand Shiite pilgrims who either walk the 50 miles from Baghdad south to Karbala or take buses. 

This attack today took place at a bus station, most likely, Sunni extremists who oppose Shiite identity, Shiite empowerment in Iraq and the pilgrimage itself.  So far, it‘s not expected as the kind of attack that is likely to trigger a wave of reciprocal violence.  But it is something to be concerned about. 

MADDOW:  In terms of contextualizing violence in Iraq and understanding the overall terror there, last time we spoke to you was right after the elections when the results were still unclear when we talked.  Now, looking back on the elections, what we know about their results, how do you assess their success now? 

ENGEL:  I think most Iraqis are happy with them.  It was definitely an affirmation of the policies of Prime Minister Nouri al-Maliki.  He is being seen as a stronger figure, a more nationalist leader in this country. 

And there was a big rejection of the Shiite religious parties who have been running this country for the last several years.  The religious parties who had a Shiite slate did very poorly. 

MADDOW:  Richard, I know that you are one of the few people who have been allowed in with a camera to see the much mocked new U.S. embassy in Baghdad.  What can you tell us about the embassy? 

ENGEL:  Critics say that it is a symbol of waste and mismanagement, and perhaps even a bit of naivete in Iraq.  And today, we were given a rare tour. 


(voice over):  It‘s the biggest, most expensive U.S. embassy ever built - 27 buildings on 104 acres, 10 times bigger than most American embassies.  The cost - over $700 million. 

(on camera):  Why does this compound need to be so big? 

SUSAN ZIADEH, U.S. EMBASSY SPOKESPERSON:  Well, this compound is large because it reflects the importance of the bilateral relationship between the U.S. and Iraq. 

ENGEL (voice over):  There are 1,200 embassy staff here along with a few hundred soldiers.  For entertainment there is a gym, swimming pool, bar and a food court.  For security, we weren‘t allowed to film any gates, roof tops or wide angles. 

(on camera):  The embassy was expensive and it is massive.  But it certainly not luxurious.  There are almost no trees, no landscaping at all, just lots of sand and stones.  In Baghdad, it is often compared to a country club or a prison. 

(voice over):  Courtyards are empty and dusty.  Windows small and bulletproof.  There‘s not a single ornament on any facade.  Critics say the embassy symbolizes overspending and poor planning.  When construction here began nearly four years ago, embassy planners expected Baghdad to be safe. 

(on camera):  This building was built to be a school.  Baghdad was supposed to be a family posting.  But that never happened.  The children never came.  And today, the school is filled with offices. 

(voice over):  Another problem - food.  The 700 embassy apartments have kitchens so diplomats could cook for themselves.  But security restrictions don‘t allow them to leave the compound to buy groceries.

So last year they built a military-style dining hall in an embassy dubbed “Fortress America.” 


MADDOW:  Richard, that is incredible footage.  How are the Iraqis reacting to the size and the character of the embassy? 

ENGEL:  It‘s impossible to miss here in Baghdad.  The embassy is right on the Tigris River.  It‘s about the size of Vatican City.  Most Iraqis don‘t have a negative reaction to it because they are not able to get anywhere near it.  It‘s seen as very remote, perhaps the Emerald City at the end of the Yellow Brick Road. 

It is in a secure environment.  It‘s inside the Green Zone, so it is something Iraqis see from far away and there is quite a bit of mystery shrouded around it. 

MADDOW:  Richard, from all the traveling that you have done, all of the different U.S. postings that you have seen abroad, what does it say to you, the size and the character of this embassy? 

What does it say to you about our plans in Iraq and what sort of presence we are going to have there? 

ENGEL:  Well, I think it shows that we are going to have a very long-term presence here.  And I also think it, in a way, symbolizes a lot of things that have changed in this country. 

Construction here at the embassy began in 2005.  And there was a certain optimism that the planners certainly had.  This embassy was going to be just bigger but like other embassies in other parts of the world. 

It was going to be family posting.  They built the school.  They also built a baseball, softball diamond for the kids who were supposed to be at that school.  They built the kitchens because diplomats we‘re going to be able to go, walk around Baghdad and buy their groceries. 

It didn‘t happen that way and the school became an office building, the baseball diamond - since there were no kids at the school, there were no kids to play baseball, so the baseball diamond wasn‘t used. 

Today, they are putting U.S. troops in containerized housing on top of what was supposed to be that baseball diamond.  And obviously, they built that dining facility because the diplomats couldn‘t go out and buy their groceries.  So I think it shows how much things have changed here and how impressions were so different when this war began. 

MADDOW:  Sort of an ironic monument to the fact that Baghdad will never be Wisconsin, no matter what creepy neo-con theories we have about what our occupation there means.  That is my editorializing, not yours.  Richard, I‘m sorry to put that on you. 

ENGEL:  I expected no less, Rachel. 

MADDOW:  You know me.  Richard Engel, NBC News chief foreign correspondent.  Richard, thank you for the tour of the embassy and safe travels to you. 

ENGEL:  My pleasure. 

MADDOW:  Coming up next, Sam Stein will be here.  He is the reporter from “Huffington Post” who President Obama called on at the press conference making lots of other reporters very jealous.  Sam has done some pretty great follow-up reporting on the Bush era crimes truth commission story that he asked the president about this week.  That is coming up in just a moment. 


MADDOW:  Do you remember back when in the Bush years when President Bush at that one press conference, that one time, he called on the hooker guy?  I should say he wasn‘t just an alleged hooker.  I shouldn‘t say that.  He was an alleged hooker turned far-right wing blogger who inexplicably got a White House press pass. 

He lobbed a softball question at Bush after Bush called on him at a press conference in 2005.  The hooker with the inexplicable press pass ticket into the White House had been rejected for press credentials by Congress.

But he somehow enjoyed extraordinary access to the Bush White House.  The memory of that still pretty much unexplained male escort excitement came rushing back this week when former Bush era White House Press Secretary Ari Fleischer embarrassed himself by criticizing President Obama for calling on Sam Stein of the “Huffington Post” during Obama‘s press conference on Monday. 


ARI FLEISCHER, FORMER WHITE HOUSE PRESS SECRETARY:  There are some reporters, you know, in that briefing room.  As you can imagine, Bill, you get a lot of dot-coms and oddballs who come in. 


MADDOW:  Fleischer said the Bush team dealt with the dot-coms and oddballs by seating them in a place he called “Siberia” and directing the president to never call on them. 

But the hooker guy?  The hooker guy who got in during Fleischer‘s watch in 2003 was definitely not in any Siberia when he was called on by President Bush at that press conference in 2005. 

So Mr. Fleischer, while “Huffington Post” Sam Stein might not be the first blogger called on at a White House press conference, he is, at least, a credible non-hooker blogger called on at a White House press conference. 

I am hoping the whole hooker reminder was a little bit of dark cloud in Sam Stein‘s otherwise bright moment in the sun this week as a journalist.  His question to President Obama was one of the more cogent and more challenging of the entire press conference. 

He asked if the president would support Sen. Patrick Leahy‘s proposal for a truth commission of alleged Bush-era crimes.  Sam is still busy with this story since reporting a follow-up interview with Senate Judiciary Chairman Patrick Leahy. 

Joining us now, not a hooker, not at all, Sam Stein, reporter for the “Huffington Post.”  Sam, I‘m sorry for everything I just said.  Thank you for being here.  You had quite a week.  

SAM STEIN, REPORTER, “HUFFINGTON POST”:  No worries.  Thank you, Rachel.  I appreciate the introduction.  

MADDOW:  Understated, as always.  What did you make of President Obama‘s response to your investigations question?  Do you think he answered it, or do you think he dodged it? 

STEIN:  A little bit of both.  He used the answer that he‘s been giving when posed this question in the past.  I mean, I understand that he‘s in a very different political reality than Patrick Leahy.  He has a national constituency and Patrick Leahy represents Vermont. 

And so he has to placate both sides of this argument and it‘s a contentious one.  That said, he didn‘t exactly answer the question whether he supports a commission nor did he exactly answer the question as to whether he would rule out prosecution there and now.  And so I would like to see him take a more firm stance one way or another.  

MADDOW:  I know that you have followed up since with Sen. Leahy.  One thing that the president did do in response to your question is that he promised to look at Sen. Leahy‘s proposal. 

Has there been an act of furtherance?  Has this gone any further since Leahy initially proposed it and you asked about it? 

STEIN:  Well, yes.  I talked to Sen. Leahy the day after.  And he said to me that he had been in conversations with Greg Craig, which is Obama‘s chief counsel.  He said the conversations were preliminary and that they were going to go on word from there. 

But I think it‘s an indication that the White House knows that this is going to happen.  I mean, one thing Patrick Leahy said is that he doesn‘t need Obama‘s OK to go forward with this.  He‘s been in the Senate for 35 years.  He is his own boss and he can do what he wants. 

And the same thing goes to Rep. John Conyers in the House who‘s introduced legislation about this.  So you have two actors who are going ahead without Obama, regardless.  So Obama is going to have to figure out how to play with these senators and representatives even if he doesn‘t even want the investigations to occur.  

MADDOW:  It seems like the big question about whether or not this will actually happen is - it‘s all about whether or not somebody finds a politically possible way for it to happen.  And my sense, just reporting on this from here, is that the most politically possible way for this to happen is for it to happen independently of the administration, at least nominally, for it to be initiated in Congress and largely pursued through Congress.  Is that how you see it? 

STEIN:  Yes, I think that‘s actually how it‘s going to take place.  Now, one of the aspects of Obama‘s answer that stuck out to me was that he said if we find illegality, we will prosecute, and regardless if you‘re an order citizen or member of the administration. 

So theoretically, if Congress under John Conyers‘ investigation or Patrick Leahy‘s can produce evidence of illegality, then Obama has committed himself and his Department of Justice to prosecuting it. 

So I think what you will see out is Congress providing the evidence and the Obama administration being in an unfortunate or sort of difficult circumstance of actually having to act on it.  So I think that‘s what you‘re going to see going forward.  

MADDOW:  One thing that I sort of prized out of Sen. Leahy when I interviewed him after his proposal was people who did not testify before such a truth commission would be totally open to prosecution, that the only way you could get immunity from any prosecution would be to sit down before this commission and say the truth, the whole truth and nothing but the truth. 

STEIN:  Yes.

MADDOW:  Do you see that as a threat toward people who might not be willing to act all contrite and sit down before a commission? 

STEIN:  Sure.  I mean, of course.  You either want immunity or you want to be, you know, a powerful subject of an investigation.  There is a flip side, of course. 

I already heard some grumbling among the more progressive readers of the “Huffington Post,” as well as some sources that they don‘t want too much immunity provided.  There are a lot of people who they want to see investigated.  And there are a lot of people who they think should be prosecuted. 

There‘s no judgment call one way or another.  But they‘re worried that if you provide too much immunity, you‘re going to miss holding responsible some of the key actors. 

MADDOW:  “Huffington Post” reporter Sam Stein, you‘ve had a very big week.  Thanks from making time in it for us.  Appreciate it, Sam.  

STEIN:  Oh, thank you very much.  

MADDOW:  Coming up on “COUNTDOWN,” Keith Olbermann asks Congresswoman Maxine Waters about the CEO fight on Capitol Hill.  

Next on this show, I get just enough pop culture from my friend Kent Jones - a stadium named after Alex Rodriguez.  Would that be a performance-enhancing stadium? 


MADDOW:  Now, it‘s time for “Just Enough” with my friend Kent Jones. 

Hi, Kent, what have you got? 

KENT JONES, POP CULTURIST:  Good evening, Rachel.  Now, despite all of the furor about Alex Rodriguez‘ past steroid use, the University of Miami says they‘re going to go ahead and name a stadium after the Yankee tabloid magnet.  A-Rod is still expected to show up Friday night at a fundraiser for when the Hurricanes will have a naming ceremony for their new stadium, Alex Rodriguez Park. 

Here‘s the sign.  (SIGN READS:  Alex Rodriguez Park - Deal with it.) 

MADDOW:  Very nice.

JONES:  Next up, remember that amazing story about the woman who swam across the Atlantic Ocean?  Hoax.

MADDOW:  Really? 

JONES:  The AP originally reported that Jennifer Figgy swam 2,100 miles from the coast of Africa to Trinidad in 25 days while escorted by a boat.  Turns out, Figgy swam only a fraction of the trip.  The rest of the time, Figgy rested on her cruise catamaran.  Total swimming distance was more like 250 miles.  Slacker.

Next - after an eh - slacker year with the Jets, Brett Favre said he will retire today from football after 18 seasons.  If he really does hang it up, Favre holds the record for most career touchdown passes, completions, yards passing and regular season victories. 

And if he ever misses the thrill of being in the NFL, every Sunday he can ask a neighbor to come over to his house and whack him in the kidneys with a baseball bat.  Good luck, Brett.  

Finally, some members of India‘s Hindu Nationalist Movement are developing a soft drink made from cow urine.  The spokesman claims the drink is going to be safe and delicious and will compete with the Cokes and Pepsis of the world. 

The spokesman said, quote, “We‘re going to give them good competition as our drink is good for mankind.  We may also think of exporting it.”  Good luck with that.  No, really, good luck with that. 

MADDOW:  Thank you, Kent. 

KENT:  Sure.  

MADDOW:  The U.S.-Mexico World Cup qualifying match set tonight.  The U.S. got to decide where it would be played.  They picked Columbus, Ohio, because they thought it would really be cold and that would (UNINTELLIGIBLE). 

JONES:  Yes.  Good choice. 

MADDOW:  They did win, though, two to zero.  The U.S. won.  

JONES:  Oh, very exciting.  Very good.  

MADDOW:  Thank you, Kent.  And thank you for watching tonight. 

“COUNTDOWN” with Keith Olbermann starts right now.  Good night.



Copy:     Content and programming copyright 2009 MSNBC.  ALL RIGHTS RESERVED. 

                Transcription Copyright 2009 CQ Transcriptions, LLC ALL RIGHTS  RESERVED.

                No license is granted to the user of this material other than for research.

                User may not reproduce or redistribute the material except for user‘s

                personal or internal use and, in such case, only one copy may be printed,

                nor shall user use any material for commercial purposes or in any fashion

                that may infringe upon MSNBC and CQ Transcriptions, LLC‘s copyright or

                other proprietary rights or interests in the material. This is not a legal

                transcript for purposes of litigation.


Rachel Maddow Show Section Front
Add Rachel Maddow Show headlines to your news reader:

Sponsored links

Resource guide