updated 8/18/2009 11:49:39 AM ET 2009-08-18T15:49:39

MADDOW

August 17, 2009

THIS IS A RUSH TRANSCRIPT.

THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

Correction 8/28/09: The spelling of the foundation detailed in World Magazine is corrected. It is the Wilberforce Foundation, not the Wilburforce Foundation.

Guest: Matt Taibbi, Joseph Petro, Jeff Sharlet, Kent Jones

RACHEL MADDOW, HOST:  Thank you very much, Keith.  Appreciate that.

And thanks to you at home for staying with us for the next hour.

We begin tonight actually with news that is both good news and unsettling news from Wall Street.  The Dow, overall, lost about 186 points today.  Now, that is not catastrophic or anything but it‘s one of those days where the market closing gets described as sharply lower on a lot of business pages.

Now, despite the market being down, the unsettling good news from Wall Street today comes from “The New York Times” market spotlight on today‘s most actively traded stocks.  Four of the eight most traded stocks in America today were giants in the health business.  Pfizer, Wyeth, Aetna, United Health—and all four had great days today even as the rest of the market slumped.

Why was today such a good day to be a stockholder in, say, United Health?  Well, here‘s a hint.

(BEGIN VIDEO CLIP)

KATHLEEN SEBELIUS, SECRETARY OF HEALTH AND HUMAN SERVICES:  And I think what‘s important is choice and competition.  And I‘m convinced at the end of the day, the plan will have both of those.  But that is not the essential element.

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY:  The bottom line for this for the president is, what we have to have is choice and competition in the insurance market.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES:  The public option, whether we have it or we don‘t have it, is not the entirety of health care reform.  This is just one sliver of it, one aspect of it.

SEN. KENT CONRAD (D), NORTH DAKOTA:  The fact of the matter is, there are not the votes in the United States Senate for the public option.  There never have been.

(END VIDEO CLIP)

MADDOW:  You know, when you have a weekend like that, it‘s no real surprise when Monday turns out to be a great day for health insurance stock prices.

How did we get here?  How did we get to the foretold death of the public option and United Health‘s awesome Monday on Wall Street?

Well, we got here through a collapse of political ambition and the resultant downgrading of expectations for this once in a lifetime, stars aligned political shot at fixing this system that accounts for 1/6 of our economy—a system that is so broken that a majority of personal bankruptcies in this country are caused by medical costs and a majority of those people who are going bankrupt because of their medical costs actually have health insurance.

Trying to meet the health care needs of our nation of 300 million people by just hoping the private sector will provide has been a disaster.  Check that.  Actually, it‘s been a disaster for the American people and the American economy.  It‘s been great for the insurance companies and for the other big health corporations who have made health care for profit a better modern corporate racket than anything other than being a defense contractor in the Rumsfeld era.

However we got to the system we have now—it doesn‘t have to stay this way.  This isn‘t the way that other countries do it.  And there are even long-standing pilot projects that have worked out pretty well, thank you, in this country for basing a health care system on the needs of patients rather than on corporations‘ needs for a fat bottom line.

The Veterans Administration, for example, offers one big, long-standing American pilot project for how to change health care.  The Veterans Administration is a nationalized health care system.  It‘s a totally public system.  The government runs the hospitals.  The health care professionals who work in the system work for the government.  It‘s the same kind of system that the general public uses in England.

Well, here in the U.S., a right-wing group opposed to health care reform called Conservatives for Patients‘ Rights has tried to convince Americans that British people hate their health care system.  They‘ve produced ads like this one—purporting to show real British people warning Americans about how bad their British NHS is.

Well, the actual British people who ended up in those ads now say they were duped.  They say they actually support the NHS and they‘re horrified to learn that they are being used to discredit it.

Another big, long-standing American pilot project for how to change health care is Medicare.  Medicare is single-payer health care.  In Medicare, the doctors and nurses don‘t work for the government.  The hospitals can still be private, even for-profit, but the government provides the health insurance.  They are the single-payer.

It essentially takes a huge bulk of administrative costs for all the private insurance companies out of the system and you end up with Medicare.  You end up with a system that Americans have a much higher degree of satisfaction with than they do for private insurance.

Most industrialized countries have single-payer or national health care.  And they spend less.  And they have better health outcomes than we do with our big experiment in hoping the private sector will provide.

Presidents from Truman in 1948 through Kennedy and Carter and Clinton have all tried to reshape, to reform the American health care system—all to no avail.  And by the closing years of the George W. Bush administration, the number of uninsured Americans was approaching 50 million and the CEOs of the 10 largest health insurance companies were taking home an average compensation of $11.9 million each every year.

In 2008, all changed.  Not only did the Democrats take the White House, but they did so with a candidate who explicitly campaigned on a health care reform promise.  They won a more than 70-seat majority in the House.  They won a filibuster-proof 60-seat majority in the Senate.

If health care reform is ever going to be possible, it‘s never going to be more possible than it is this year.  But from the very, very beginning, single-payer health care and national health care were completely off the table.

As Matt Taibbi writes in his new gut-wrenching article on health care for “Rolling Stone,” when key Democratic Senator Max Baucus convened the first roundtable discussions on health care reform last May, Senator Baucus invited 41 witnesses to Capitol Hill to share their perspective on what ought to happen with health care reform.  Forty-one witnesses over three days, not a single witness was scheduled to speak in favor of single-payer.

Because single-payer was inexplicably, totally beyond the realm of consideration, Democrats ended up instead proposing something called a public option—a Medicare-like plan that at least some Americans could choose to buy into instead of buying private insurance.  Now, apparently, even that is off the table, too.

We know that the president both when he was a candidate and well into the current debate as president said that a public option was a must.

(BEGIN VIDEO CLIP)

OBAMA:  That‘s why any plan I sign must include an insurance exchange, including a public option to increase competition and keep insurance companies honest—and choose what‘s best for your family.

(END VIDEO CLIP)

MADDOW:  Must, he said—must.

He has changed his mind on that now apparently.  Even Max Baucus, the won‘t even consider single-payer conservative senator from Montana who leads the committee that is now dropping the public option, even Max Baucus was in favor of the public option as recently as last November when he published his big 100-page health care proposal that called for, quote, “a new public option, a new public plan option similar to Medicare.”

So, if Max Baucus was in favor of a public option and President Obama was in favor of a public option, and a public option survived through three House committees and one Senate committee that passed bills on health care reform so far, why is the public option dying now?

It‘s dying because of a collapse of political ambition.  The Democrats are too scared of their own shadow to use the majority the American people elected them to in November to actually pass something they said they favored.

Senator Baucus has decided to take decision making about health care reform out of the full committee on which Democrats have a huge majority and instead he wants it to be decided by a mini committee that he made up, that‘s three senators from each party.

As if the American people elected a half and half Republican and Democratic Senate this year—which we did not.  We elected a big Democratic majority.

But then Democrats decided to wield that majority by giving the Republicans control over what kind of health care reform we get.  So, we get no public option.  We get no public option.  No single-payer.  No national health plan.  Maybe some insurance reform, maybe not—depends on what else the Republicans want probably.

Joining us now is Matt Taibbi, contributing editor at “Rolling Stone” magazine whose article “Sick and Wrong: How Washington is screwing up health care reform and why it may take a revolt to fix it” appears in the next issue of “Rolling Stone” which is out on Friday.

Matt, it‘s great to have you back on the show.

MATT TAIBBI, “ROLLING STONE”:  How‘s it going, Rachel?

MADDOW:  You are simultaneously very smart and very depressing.  This is a brutal assessment of what you think is possible out of this process.

TAIBBI:  Yes.  You know, I think it‘s just going to be a very low moment for the Democratic Party.  This health care thing, if it turns into the debacle that it looks like it‘s going to, might be an albatross around the neck of the party the same way that the Iraq war was for the Republicans, I think.

MADDOW:  The White House and Senate Democrats are now saying no public option.

TAIBBI:  Right.

MADDOW:  That has caused liberal Democrats in the House and Bernie Sanders in the Senate to say, “OK.  Then no health reform at all.”  Anthony Weiner of New York out in front on that today saying if there isn‘t a public option it will not pass the House.  I can get a hundred Democrats to vote against it if it doesn‘t have a public option.

Is dropping the public option a disgusting enough political surrender that it might actually sort of wake up the liberal base here?

TAIBBI:  I think, actually, it might be.  You know, when Nancy Pelosi was asked the question when she was asked if it was possible that the progressives might end up not voting for the bill if the public option was watered down, she actually laughed out loud.  That was about a month ago.

But in speaking to members of Congress, both in the House and the Senate, I think this is kind of a line in the sand issue for them.  I think there are lots of people who are seriously considering not voting for this thing.  And if there is no public option, I think you probably will see that revolt among the progressives in both houses.

MADDOW:  I was surprised to learn today, and it Jed Lewison posting it at “Daily Kos” today, it was the reason that I know it, because I didn‘t know it before.  I was surprised to learn that Max Baucus had been explicitly on record in his health care reform from November as being in favor of the public option.  It seems like even the most conservative Democrats—until quite recently—were in favor of the public option.

Do you think it went away because they ceded power to the Republicans or do you think they change their minds?

TAIBBI:  Well, one of the things important to remember is that they bargained away a single-payer from the very start.  I mean, there was absolutely no discussion of it throughout the entire process.

And a lot of people that I talked to seemed to think that this was really a handshake deal between the White House and the insurance industry and the pharmaceutical industry.  Basically there was a quid pro quo.  We‘re going to take single-payer off the table at the very start.  You promise not to hammer us the way you hammered Bill Clinton when he tried to push through health care reform.

So, this was—this was something they never intended to do, I think, throughout this entire process.  This was really a dog-and-pony show where they entertained the notion of maybe doing a public option, but the more serious reform was never viable throughout this entire time.

MADDOW:  But that gets you to we‘re not considering single-payer.

TAIBBI:  Right.

MADDOW:  How do we get from Barack Obama saying there must be a public option, even Max Baucus saying there has to be a public option, to now, all of a sudden, no public option.  What changed?

TAIBBI:  You know, this is a complete and total mystery to me because it‘s not like they‘re going to get any Republican votes by dropping the public option.

MADDOW:  Ding!

TAIBBI:  You know, this is an auction where there‘s only one person in the audience.  You don‘t have to keep bidding higher.

MADDOW:  Right.

TAIBBI:  You‘re the only person there.  You‘re going to get the painting in the end, you know?

It doesn‘t make any sense what they‘re doing and indicates to me that this is really what they want.  They really wanted to pass something that doesn‘t have any meaningful effect on the insurance industry.

MADDOW:  It‘s not too late.  They could change their minds.  Things have been—I mean, we passed three committees in the House, one committee in the Senate.  Still has to get out of Baucus‘ committee if the argument is that they‘re going to get Republican votes.

TAIBBI:  Right.

MADDOW:  If they drop the public option, couldn‘t Republicans just make it all the more patently obvious that none of them are going to vote for this thing no matter what they do and then Democrats can drop their hands and say fine, “We‘ll do what we want then, we will do a public option”?

TAIBBI:  Yes.  I think that that absolutely could happen and that might end up being the course that they‘ll pursue.  But, you know, right now it looks like they‘re really going to—going to kowtow to the Republicans and drop this thing.  And just—it doesn‘t make any sense why.

MADDOW:  Yes.

Democrats, when—when Senator Grassley says health care reform is a plot to pull the plug on grandma, that‘s your signal that he‘s not going to vote for anything, stop giving stuff up to woo him.  Sorry.  Sorry.

Matt Taibbi—thanks for letting me do that—contributing editor of “Rolling Stone,” your article is really illuminating, really helpful.  Thanks as always.

TAIBBI:  Thanks for having me on.

MADDOW:  OK.  A big city mayor starts behaving like a superhero and has the injuries to show for it.

And since when did a public appearance by the president turn into a gun show?  And by that I do not mean the kind of gun show that‘s just a euphemism for nice biceps.  I mean actual guns.  That‘s next.

Stay with us.

(COMMERCIAL BREAK)

MADDOW:  Today, President Obama addressed the Veterans of Foreign Wars convention in Phoenix.  Outside the convention hall, one man wore an AR-15 semiautomatic assault rifle strapped to his shoulder, as well as a pistol on his hip.

No, he was not a police officer.  No, he was not a Secret Service officer.  He was just a guy showing up strapped to an event featuring the president of the United States.

“The Associated Press” reports that, in total, about a dozen people were on site outside the convention hall today visibly carrying firearms.  Again, not police officers, not Secret Service officers, just regular citizens turning up to be seen carrying weapons near the president—yet again.

Last week, there was this man in New Hampshire waiting for President Obama to arrive at a town hall event there.  The man had a loaded handgun strapped to his leg.  He was holding a sign that read, “It is time to water the tree of liberty.”  Of course, it‘s a reference to Thomas Jefferson‘s famous words that were worn on a t-shirt by Timothy McVeigh on the day that he bombed the Murray Building in Oklahoma City.  “The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.”

At the same event for President Obama in Portsmouth, New Hampshire, a 62-year-old man named Richard Terry Young was arrested and charged with two misdemeanors after sneaking past security officials and into Portsmouth high school a few hours before President Obama was due to arrive.

Mr. Young was found inside the school.  He was allegedly carrying a knife.  When officers searched his pickup truck, they found a .38 caliber KelTec semiautomatic pistol hidden inside a bag with a round in the chamber.

I‘m sensing a theme here—one that requires some explanation.  As far as I understand it, he can‘t even fly a small plane into the air space over the White House.  In fact, the FAA often bans aircraft anywhere near the president‘s destination when he travels outside of D.C.  But it‘s kosher to bring your AR-15 to an event featuring the president of the United States?  Really?

Joining us now is Joseph Petro.  He served for 23 years as a special agent and as an executive in the Secret Service.  He‘s also author of the book, “Standing Next to History: An Agent‘s Life Inside the Secret Service.”

Mr. Petro, thanks very much for being here.

JOSEPH PETRO, FMR. SECRET SERVICE SPECIAL AGENT:  Rachel, my pleasure.

MADDOW:  Today, according to the “A.P.,” there were a dozen people, who weren‘t security officers or police, carrying firearms at this event where the president was.  I don‘t know if the guns were loaded.  There‘s no reason to assume that they weren‘t.

How does the Secret Service plan protection for that type of situation?

PETRO:  Well, it‘s not something the Secret Service often encounters.  You know, the Secret Service is protecting presidents for a long time.  And there are a whole series of processes and procedures that they go through to create perimeters.  And each of those perimeters become more and more difficult to penetrate, up right to the end where the agents are actually around the president.

But I think this is less a Secret Service issue and more as an issue for all of us.  You know, you said a few days ago that the possibility of American politics turning to violence or terrorism at the fringe is not all that theoretical.  I would argue that the vitriolic political rhetoric we‘re hearing from some seemingly responsible people is stimulating a lot of these foolish stunts, and they‘re not very helpful.  And I think they‘re dangerous actually.

And I think they‘re dangerous for two reasons.  One is, it‘s hard enough to protect the president.  The Secret Service and the local police are being distracted from that—from that duty to keep our president safe.  And I think the second reason, and maybe even more serious, is the fact that it could incite or encourage one of those individuals at the fringe that you mentioned, from doing something really dangerous and perhaps violent against the president or some other person.

So, I think it‘s—this is not a helpful situation and maybe the politicians should look at lowering some of the rhetoric to try to create a more positive atmosphere.

MADDOW:  I understand that, depending on the state, people have a range of rights to carry and display weaponry.  At what point does the Secret Service have the right to say, actually, the threat of an assassination attempt preempts those rights so they could remove someone or at least confiscate the weapon?

PETRO:  Well, you know, I mentioned the perimeters.  I mean, we could expand—the Secret Service could expand those perimeters even further.

MADDOW:  Right.

PETRO:  I mean, a mile away.  I don‘t—theoretically, that‘s possible.  And the Secret Service would have a right then to take and prevent anyone from entering that perimeter with a weapon.  But I think just to do this at all as a stunt.

MADDOW:  Yes.

PETRO:  . is just irresponsible.

MADDOW:  I think, whether or not these individuals posed an individual threat to the president, it does seem clear that—I mean, as you say, it‘s a stunt.  It certainly seems like an implied threat of force.

And when you make strategic decisions about security, protecting a high value target like the president, is—do you—do you factor in the sort of material consequences of a dangerous atmosphere, of an atmosphere in which the threat of force is endemic?

PETRO:  I think it‘s probably the—one of the fundamental principles of the Secret Service is to create an atmosphere of calm and quiet around the president.  I mean, that‘s really what the Secret Service tries to do so that anything that happens that‘s out of character to that quiet atmosphere is noticed.  It‘s not in the Secret Service‘s interest to have this kind of these theatrics going on around.

Clearly, those people are not dangerous to the president at that moment.  You know, they‘re outside the building.  They‘re a block away or, you know, they‘re not going to—they‘re not an immediate danger to the president.  But what they‘re creating is an atmosphere that is—that could become dangerous for the president.  And that‘s what would concern me and I‘m sure it concerns the Secret Service.

MADDOW:  Joseph Petro served for 23 years as special agent and executive in the Secret Service.  The book is called “Standing Next to History: An Agent‘s Life Inside the Secret Service.”

Mr. Petro, this is really, really invaluable insight.  Thank you for coming in.  It‘s nice to meet you.

PETRO:  Nice to meet you.

MADDOW:  Thanks.

So, how do you know when the scandals surrounding C Street and the secretive religious group that runs C Street have reached critical mass?  You know it when a C Street expose is published in a major Christian magazine.  Author Jeff Sharlet joins us with the latest.

Stay with us.

(COMMERCIAL BREAK)

MADDOW:  Still ahead: The latest news about the Family and C Street from Jeff Sharlet.  Plus, following up on what they‘ve done to the health care fight, corporate-sponsored professional debate disturbers have a new target.  Plus, my friend Kent Jones takes a look at the new movie “District 9” and he has determined that space aliens are people, too.

All that is coming up.

But first, it‘s time for a few holy mackerel stories in today‘s news.

Wisconsin‘s Democratic Governor Jim Doyle announced today that he will not seek re-election next year.  And as these things always do in politics, the announcement ignited a chaste little orgy of political speculation.  Who is the next likely governor of the Badger State?

It could be Congressman Ron Kind.  It could be former Congressman Mark Neumann.  It could be Lieutenant Governor Barb Lawton, who just today announced that she‘s joining the race.  These are some of the potential contenders.

If I were a betting TV show host, I would bet the bell cow that Milwaukee Mayor Tom Barrett‘s personal approval ratings just skyrocketed into lifetime appointment territory.

On Saturday night, Mayor Barrett was leaving the Wisconsin state fair with his sister, his niece, and his two young daughters when he heard a scream.  Barrett told his sister to take the children out of harm‘s way and he went to confront a young man who was allegedly threatening his ex-girlfriend‘s mother and his own 1-year-old daughter.  The mayor said the young man should cool down.

The mayor took out his cell phone to call 911, whereupon the young man apparently hit the mayor in the torso and over the head with a pipe.  The mayor fought back, apparently fracturing his hand when he punched the guy.  The young man ran off and the mayor was left in a pool of blood.  His niece called 911.  The mayor was rushed to the hospital.

The mayor‘s brother John Barrett spoke with reporters about the incident yesterday.

(BEGIN VIDEO CLIP)

JOHN BARRETT, MAYOR BARRETT‘S BROTHER:  Tom stepped up and did the right thing.  He called 911 and tried to calm the situation, protect a grandmother and her grandchild.  We are extremely proud of Tom‘s selflessness and courage.

(END VIDEO CLIP)

MADDOW:  The young man who allegedly beat up the mayor was arrested 13 hours later at a friend‘s house.  He‘s being held on suspicion of felony battery.

Mayor Barrett had surgery on his broken hand.  He was treated for a number of cuts on his head and his face that required stitches.  He was released from the hospital today and reportedly received a “get well” card from President Obama.

Now, as much as I enjoy the occasional bratwurst, I am no expert on Wisconsin politics.  So, I don‘t know actually if Mayor Barrett of Milwaukee should be the next governor of Wisconsin.  But I am a huge comic book fan.  And Mr. Mayor just totally made it through the first two standard chapters of man becomes superhero.  If he doesn‘t get elected governor, he should at least get a cape and mask out of this.

Also we have a correction.  On Friday, in a report on the trend of anti-health reform protestors across the country calling the president a Nazi, we reported that one Republican member of Congress had that day called bullpucky and said that the Nazi references should stop.  She is Washington State Republican Congresswoman Cathy McMorris Rodgers.  She‘s the fifth ranking Republican in the House and she offered this rebuke in “The Hill” newspaper.

She said, quote, “I certainly don‘t condone violence.  I don‘t condone calling President Obama Hitler and painting swastikas on signs at town halls.”

All that was true and I said it right on the air, but unfortunately we bungled the visual.  We showed you Representative Cathy McMorris Rodgers, but we incorrectly labeled her on screen as a Democrat.  She is not.  She is a Republican.  I very much apologize for the error.

And finally, you might remember that back in June, the Obama Justice Department filed a brief defending the Defense of Marriage Act.

*

MADDOW:  She is Washington State Republican Congresswoman Cathy McMorris-Rodgers.  She‘s the fifth ranking Republican in the House and she offered this rebuke in “The Hill” newspaper.  She said, quote, “I certainly don‘t condone violence.  I don‘t condone calling President Obama ‘Hitler,‘ and painting swastikas on signs at town halls.”

All that was true and I said it right on the air, but unfortunately, we bungled the visual.  We showed you Rep. Cathy-McMorris Rodgers, but we incorrectly labeled her on screen as a Democrat.  She is not; she is a Republican.  I very much apologize for the error. 

And finally, you might remember that back in June, the Obama Justice Department filed a brief defending the Defense of Marriage Act.  That was passed during the Clinton administration. 

The Obama administration brief contained some very Jerry Falwell-like language stating not only that the Defense of Marriage Act was constitutional but that consensual, same sex marriage between two adults was legally comparable to the marriage of an uncle to his niece or to underage marriage.  Nice. 

Well, today the Justice Department filed another brief.  Again, defending DOMA because the administration says it‘s standard practice for the department to defend all federal laws, even the ones it doesn‘t agree with. 

But this time there has been a remarkable change in tone, quote, “This administration does not support DOMA as a matter of policy, believes that it is discriminatory and supports its repeal.” 

Oh, nothing about the uncle.  Huh.  In conjunction with this tone shift from the Justice Department, President Obama also released a statement today saying, quote, “This brief makes clear that my administration believes that the act is discriminatory and should be repealed by Congress.  I have long held that DOMA prevents LGBT couples from being granted equal rights and benefits.” 

If only we had some sort of simple way to sort this stuff out.  Something like, constitutional amendment or something, like maybe kind of after the 13th Amendment and before the 15th Amendment and could like make crystal clear whether the federal government could deny people equal protection under the law?  That would be awesome.  Ah, well, TV show host can dream.

(COMMERCIAL BREAK)

MADDOW:  One of the strangest political connections of this whole summer has been the linkage between three - count them - three conservative Christian Republican sex scandals and a house in Washington that‘s called C Street.  C Street is run by a secretive religious organization called The Family.

And because its C Street house has been implicated in the sex scandals of Sen. John Ensign and Gov. Mark Sanford and the alleged affair of former Congressman Chip Pickering, The Family has been getting a lot of unwanted scrutiny this summer. 

Well, now, the scrutiny is coming from an unlikely direction.  As we reported on this show on Friday, the current cover story in the Christian magazine, “World,” is an investigation into the family and C Street. 

In the past, “World” has expressed what could be described as hostility to untoward discussion of the secretive organization.  But now, The Family is on the front page and not in a good way. 

The article exposes The Family‘s mysterious money trail and describes the C Street scandals using the word “scandal” and argues that The Family subscribes to a, quote, “muddy theology” and it harbors, quote, “a disdain for the established church.” 

Perhaps even more significantly, “World” magazine quotes several relatively well-known and important figures on the religious right who are now willing to go on the record stating their own misgivings about The Family. 

For example the article quotes a man named Rob Schenck.  Who is Rob Schenck?  He‘s the man in this video we first aired last month joining Republican Sen. Jim Inhofe of Oklahoma as Sen. Inhofe bragged about Family-funded trips he had taken to Africa. 

Well, now, Rev. Schenck says of C Street that the lack of church discipline and structure is, quote, “a serious missing element in this whole thing, both in the lives of the individuals involved and in the fellowship organization as a whole.” 

The magazine also talked to Charles Colson, who after becoming a Watergate felon, went on to become a very controversial but influential figure on the religious right.  Quote, “Colson now has concerns about politicians using the C Street group as a replacement for church.  It‘s a mistake,” he said.  “A leading figure ought to belong to a church.” 

When Jeff Sharlet‘s book about The Family was first released in hard cover in 2008, the reaction from “World” magazine was essentially to call him a conspiracy theorist.  The review of Mr. Sharlet‘s book in September of last year from “World‘s” editor-in-chief, Marvin Olasky, argued that Jeff Sharlet, quote, “reflects a growing paranoia about evangelical influence in American politics.” 

The folks at “World” magazine may be changing their minds about that now because it‘s not paranoia if they really are out to get you. 

Joining us now is Jeff Sharlet.  He of course is author of the book “The Family: The Secret Fundamentalism at the Heart of American Power” which is now out in paperback.  Jeff, thanks you very much for coming back on the show.  Nice to see you. 

JEFF SHARLET, AUTHOR, “THE FAMILY”:  Hi, Rachel.  Glad to be here. 

MADDOW:  What‘s significant about this particular magazine running this type of story about The Family? 

SHARLET:  I think it‘s even bigger than a schism.  I mean, this as moment of reckoning for The Family and for the kind of elite fundamentalism it represents.  You know, on the one hand, you see sort of the Christian right trying to save itself by cutting off a limb. 

But on the other hand, even looking in response to the article, so many readers of “World” magazine saying why did it take you so long to expose this?  You see pressure from honest conservatives who are saying, you know, “We may disagree with liberals but we agree with democracy.  We don‘t believe in this kind of cult of power and wealth for a chosen few.” 

MADDOW:  One of the major points of investigation in the article deals with money.  And you and I have talked about that a little bit but this is the most that I have ever seen in contemporary post-your-book reporting on the subject by anybody other than you. 

This article reports on one Family-affiliated charity organization that‘s called the Wilberforce Foundation.*  It says the Wilberforce Foundation has no employees but transacts thousands of dollars back and forth with The Family.  How does this square up with what you know about their money trail? 

SHARLET:  Perfectly.  In fact, when I lived with The Family, the story I tell in the beginning, I paid my rent check to the Wilberforce Foundation.  But what‘s really important is that it‘s not just the Wilberforce Foundation but its linkage of so many different nonprofit groups that The Family uses. 

One defender of the group says it‘s like a star fish.  You cut

off one arm, another grows back.  And an example, that the scandal has

opened up for us is, working with a group called Military Religious Freedom

Foundation, we discovered that the Pentagon had assigned a board member of

one Family organization to investigate seven senior officers who had

violated military regulations in association with another Family

organization. 

I mean, it‘s really one arm of The Family investigating the other.  It perfectly illustrates what The Family means when they call themselves the Christian Mafia. 

MADDOW:  In terms of the sources for this article, the people willing to talk on the record, the type of information they had access to, what else here is revelatory.  What else should we be drawing to in this article? 

SHARLET:  You know what?  What‘s particularly striking to me is that first of all, this Christian right magazine “World” did what the “New York Times” and the “Washington Post” haven‘t.  And it went to those - all the politicians involved and asked, what‘s going on here? 

What was striking is that these politicians who would normally love to be featured in “World” magazine - that‘s good with their voters.  Suddenly, they‘re saying, “I can‘t speak on the record.  No comment. 

Please, no questions.” 

You see them stonewalling.  They understand that they have crossed a line.  And I think what‘s significant about this is a lot of Christian conservatives out there are going to say, “Hey, I don‘t support a group that teaches that Jesus had one sort of secret messages for powerful people and a different message for everybody else.” 

The damage this goings to do to The Family is impossible to over estimate.  And I‘m so glad that it‘s coming from a Christian right source. 

MADDOW:  One of the things that struck me was the tone of the article being so focused on the issue of theology, describing the theology of the group as muddy, going into detail about the fact that none of the leaders of this purportedly religious organization actually have any formal religious training of any kind and then the litany of criticism from Chuck Colson and others that this group has been essentially - has essentially taken on the role of superseding the church, of replacing the church in these ostensibly religious politicians‘ lives. 

How much does the policy - how much does The Family count on support from mainstream Christians in terms of its, you know, multimillion dollar revenue sources?  How much does it need to count on mainstream Christians and evangelicals in order to get its work done?  And could this pose a problem moving forward just on the theological terms? 

SHARLET:  Yes, those relationships are very old and deep.  For instance the C Street house is actually - the deed to the house is actually owned by another Christian right group called Youth with a Mission. 

The Family has had linkages to all of these organizations over the years.  And on Friday, while “World” magazine was taking on The Family and doing a good job of it, Pat Robertson‘s Christian Broadcasting Network, as you noted on FRIDAY, was defending The Family, even saying - I believe the anchor said, “I applaud Doug, the leader of The Family,” leader Doug Coe, for what he does and I applaud him for his secrecy.” 

But in the face of what “World” is reporting about the money, about the strange theology, the idea that within The Family the word “Christian” is taboo.  That comes from a former family leader.  I think that‘s going to make it very difficult for The Family to continue those relationships as it has in the past. 

MADDOW:  As you‘ve reported, Jeff, The Family has been around 80 years.  The year 2009 is very different than every other year they have ever been through.  I still don‘t know how this is all going to end up but it sure has been a big deal this year. 

Jeff Sharlet, author of the book “The Family: The Secret Fundamentalism at the Heart of American Power.”  It‘s always great to see you, Jeff.  Thank you very much. 

SHARLET:  Thank you, Rachel. 

MADDOW:  Coming up on “COUNTDOWN”, barely months into their new massive majority, new math from election savant Nate Silver suggests Democrats may be in danger of losing in 2010.  Keith assesses the Democratic threat level with his special guest, former Democratic Party Chairman Howard Dean. 

Next on this show, it‘s astroturf 101, courtesy of the angry renters at “AngryRenter.com” who aren‘t actually people who rent anything.  This is a good one.  Stay with us. 

(COMMERCIAL BREAK)

MADDOW:  In May of last year, as the government tried to cope with the subprime mortgage crisis that was sucking the world into the Great Depression act two, one of the things that Congress was debating was whether or not struggling homeowners would get government assistance, whether Congress would provide some insurance to homeowners who wanted to refinance their troubled mortgages. 

While Congress was debating that, up popped a new Web site, weighing in on the issue.  And it had a very, very grassroots-y feel to it.  It was called “AngryRenter.com.”  And it looks like it was put together by a not-so-Web-savvy, genuinely angry group of Americans who were presumably renters, hence the name, “Angry Renter.” 

The angle was that people who rent apartments or houses from other Americans were, for some reason, vehemently opposed to their landlords getting saved by the government or something.  That at least seemed to be the idea. 

The Web site included lines like, “We are millions of renters standing up for our rights.”  “We are the class that has been ignored in this debate.”  And, “We don‘t have lobbyists in Washington, D.C.” 

Now, here is where grassroots becomes grassroots-ish or grassroots-y or not at all grassroots.  You see, technically, the folks behind “AngryRenter.com,” they may not have had lobbyists in Washington, D.C.  But that‘s mainly because the folks behind “AngryRenter.com” were lobbyists in Washington, D.C. 

If you scroll down to the very bottom of this page, you will see that “AngryRenter.com” is a project of the organization Freedom Works, a group we have discussed many times on this show.  Who are the sort of renters at Freedom Works who were so angry they felt compelled to launch “AngryRenter.com?” 

Well, meet Steve Forbes, a director of Freedom Works, former presidential candidate, and according to “The Wall Street Journal,” proud resident of a $2.78 million estate in central New Jersey which I‘m pretty sure he doesn‘t rent. 

That said, again, according to “The Journal” quote, “The Forbes family did sell off its private island in Fiji and their palace in Morocco.  But they do still own a chateau in France.”  Perhaps “AngryChateauOwner.com was just too hard to spell. 

Another one of the millions of renters standing up for our rights along with Mr. Forbes is, of course, the head of Freedom Works, former Republican House majority leader Dick Armey.  Mr. Armey also not a renter, at least I don‘t think so, on his 90-ish-acre ranch in Texas valued a couple of years ago at approximately $1.7 million. 

Those are your angry renters.  Big credit for “The Wall Street Journal” for having exposed that little bit of astroturfing outrage last year.  Here is why the example of “AngryRenter.com” remains relevant and oh-so-instructive.  It‘s because this is a template. 

This is what corporate PR designed not to look like corporate PR looks like.  All the outward appearances of grassroots outrage but it‘s fueled by corporate-funded beltway PR. 

Do you remember the recent grassroots-y-sounding group called Patients First that‘s actually Americans for Prosperity?  Same deal, same template, same grassroots-y look, same corporate-funded beltway PR.  And because of the way that organizations like Freedom Works and Americans for Prosperity are structured, they don‘t actually have to disclose who gives money to them. 

But if you‘re able to figure it out, there do appear to be some patterns.  According to “The Washington Post,” for example, Freedom Works has received major funding from the tobacco company Philip Morris.  Lo and behold, on the Freedom Works Web site you‘ll find that, quote, “Raising the cigarette tax is bad policy.”

According to “The National Journal” in 2005, Freedom Works received funding from the phone companies SBC and Verizon.  Around the same time, Freedom Works launched their, “Choose Your Cable” campaign which argued that it should be easier for phone companies to get into the cable TV business. 

And it‘s not just Freedom Works that does this.  It‘s also groups like the 60-Plus Association, a seniors‘ advocacy group we have talked about on this show before.  According to an investigation by the AARP, an actual seniors advocacy organization, 60 Plus was taking pharmaceutical industry money while they were opposing pharmaceutical reform in states including New Mexico and Minnesota. 

This may look like advocacy but it smells like an ad.  Once you recognize this pattern, it‘s sort of easy to see what‘s coming next.  And thanks to a document obtained by Greenpeace and reported by “Talking Points Memo,” we now have the game plan for how the corporate interests in the oil and gas industry are planning to try to stop climate change legislation. 

It‘s an internal memo from the American Petroleum Institute which represents about 400 oil and gas companies.  The memo urges its member oil companies to recruit their own employees to take part in anti-climate change legislation rallies that are being held around the country. 

The objective, they say, is to, quote, “put a human face on the impact of unsound energy policy.”  Who is organizing this campaign?  That‘s something referred to in the memo as the Energy Citizens Alliance. 

What sort of citizens are part of the Energy Citizens Alliance?  Well, it‘s a coalition of industry groups and conservative advocacy groups including Freedom Works and the 60 Plus Association.  I know them. 

The president of 60 Plus, Jim Martin, also happens to be on the board of advisors for the Consumer Energy Alliance.  Ta-da!  This stuff really isn‘t that hard to figure out.  You could do it at home.  It‘s not like they‘re reinventing the wheel here.  They do the same thing over and over and over again, depending on whatever threat to corporate profits currently exists. 

This is part of how Washington works, and these groups have every right, of course, to do what they are doing.  This is part of free speech, even corporate free speech.  But we have a right to tell you who they are and to tell you what interests they are representing when they speak in the political marketplace. 

Every time you see a Web site like “AngryRenter.com” or “EnergyCitizens.net,” you can do this at home.  Go to the bottom of the page, poke around at the “About Us” section of the Web site and see who runs it and ask yourself why. 

These are not spontaneous uprisings of average Americans.  This is industry-led, corporation-sponsored PR.  And say it with me now - it should be reported as such.      

(COMMERCIAL BREAK)

MADDOW:  We turn to our alien affairs correspondent, Kent Jones.  Hi, Kent. 

KENT JONES, POP CULTURIST:  Hi, Rachel.  The new movie “District Nine” was number one at box office this weekend.  And as it turns out, it‘s great.  Very encouraging, America.  Well done.  Check it out. 

(BEGIN VIDEOTAPE)

(voice-over):  Remember the end of “Close Counters?”  The adorable big-eyed aliens taught us their musical language?  Picked up Richard Dreyfus, then soared off into the heavens in a gorgeous flying disco.  Such friendly aliens.  Such beautiful manners.  Come back any time. 

“District Nine” imagines a close encounter of a very different kind with hulking, hard-to-understand crustaceans that come to earth and stay and have kids.  ET, go home.  Seriously.  Get out. 

The earthlings welcome their galactic neighbors by hiring a scary military contractor to herd them into a shantytown called District Nine.  You can guess how well that works out. 

This is urban planning by Tom Tancredo.  Set in Johannesburg, “District Nine” is a sharp, smart, apartheid allegory about the way we treat each other.  But it‘s not pretty, which is how we like creatures that aren‘t just like us. 

Cute aliens?  Aww.  Ugly aliens?  Blast them.  Makes me wonder, would the humans have accepted the aliens if they looked like this?  Of course, to them, we‘d look better like this.  Point of view is everything. 

(END VIDEOTAPE)

MADDOW:  Excellent, Kent.  I have a very quick cocktail moment for you. 

JONES:  Oh, great.

MADDOW:  Check out this clip from yesterday. 

(BEGIN VIDEO CLIP)

MALIA OBAMA, DAUGHTER OF PRESIDENT BARACK OBAMA:  This is a

sedimentary rock and -

BARACK OBAMA, UNITED STATES PRESIDENT:  Volcanic rock.

M. OBAMA:  There is a rock made out of cooled lava.  What‘s that called again? 

RANGER:  Begins with an “I.”

SASHA OBAMA, DAUGHTER OF PRESIDENT BARACK OBAMA:  Lava rock.

M. OBAMA:  Igneous rock. 

RANGER:  Very good.  And there‘s one more.

M. OBAMA:  One more.  That‘s made out of -

RANGER:  This one is going to be hard.  It‘s so hard, met - meta -

M. OBAMA:  Metamorphic. 

RANGER:  Very good.

(END VIDEO CLIP)

MADDOW:  Igneous and metamorphic. 

JONES:  Outstanding.

MADDOW:  So cool.  Thank you for watching.  “COUNTDOWN” with Keith Olbermann starts right now. 

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