'The Rachel Maddow Show' for Thursday, May 6, 2010
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Guest: Shannon Zimmerman, James Cavanaugh
KEITH OLBERMANN, “COUNTDOWN” HOST: And, now, ladies and gentlemen,
with another hour of excitement and fun—here is Rachel Maddow.
Good evening, Rachel.
RACHEL MADDOW, HOST: Another hour of excitement and fun?
MADDOW: I‘ve been upgraded.
OLBERMANN: Well, I was referring to this hour and now you‘re another
hour, I wasn‘t—go ahead, please.
MADDOW: Thank you very much, Keith. Appreciate it.
MADDOW: And thanks to you for staying with us for the next hour of
excitement and fun.
The U.K. election, the latest on the Times Square bombing, and the
coverage of the Times Square bombing, plus, the dramatic new news on the
B.P. oil disaster in the Gulf today—that is all still to come this hour.
But we start with this: How much would you pay for a Sam Adams right
now? An ice cold Samuel Adams Boston Lager? How about if I told you you
could have one for free?
Actually, scratch that. How about if I told you you could have the
entire company for free? For a very, very brief un-shining moment this
afternoon, Wall Street valued the entire Boston Beer Company, the company
that makes Sam Adams beer, Wall Street valued the entire company at
precisely zero dollars.
Boston Beer was a number of companies who, in the bizarre flash crash
that happened on Wall Street today, briefly saw its stock price go to zero.
The company was worth zero dollars.
It wasn‘t the only one. A blog at “The Wall Street Journal” today
rounded up some of the others. Exelon, one of the largest utility
companies in the world, normally valued at about $30 billion, today was
briefly worth zero dollars. It was free. The stock price of Exelon was
Same goes for Accenture, the big consulting firm. Stock price at one
point today, zero.
The utility CenterPoint Energy, also, stock price: zero. The
specialty pharmaceutical company Impact Labs, again, stock price at one
point today, zero.
Even if you don‘t know anything about the stock market, you can see
from the stock prices and the graphs that we just put up that aside from
the huge flash drop in the middle of the afternoon, the prices of shares of
those companies was actually relatively steady today. They all went down a
little bit from opening bell to closing bell, but nothing that would get
them on to cable news show that‘s aren‘t usually about the stock market.
Do you want to know even something weirder that happened today? Even
weirder than all of those stocks going to zero at one point? It wasn‘t
just stocks dropping inexplicably to zero.
“The Journal” also notes that at the same time that some companies
were becoming free, becoming valued at absolutely nothing according to Wall
Street, some other companies went off charts in the other direction. The
auction house, Sotheby‘s, for example, which has the stock price bid, get
it, Sotheby‘s auction—Sotheby‘s started the day with its shares costing
$34 and something.
Sotheby‘s ended the day with its stock costing $33. It‘s a drop, but
it‘s no big, right? It goes between $34 and $33, whatever. Until you
notice that in the middle of the day, at one point, the stock price of
Sotheby‘s shares went to $100,000 per share—which means that at some
point today, Sotheby‘s went from a company being worth $2.2 billion to
being a company worth $6.8 trillion. Which means, for a minute, that one
company had a net worth of somewhere between the size of the entire
economies of the United States and China.
Congratulations, Sotheby‘s. Bid high.
Even for people who don‘t watch the stock market, what happened on the
market today was nuts. It was crazy. And then almost as soon as it
happened, the flash crash was over.
I want you to watch this one insane minute of what happened on CNBC
during this weird crash. It was—again, this is a very specific moment
in which this all happened this afternoon, just watch this—watch what
happened on CNBC. We always have this on in the background of the offices
here, right? And on CNBC during this minute, they‘re talking about Procter
& Gamble stocks.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: P&G is now down 25 percent.
UNIDENTIFIED MALE: Well, if that‘s true, if that stock is there, you
just go and buy it. It can‘t be there. That is not a real price.
UNIDENTIFIED MALE: Oh, just go buy Procter?
UNIDENTIFIED FEMALE: This is unprecedented.
UNIDENTIFIED MALE: Just go buy Procter & Gamble. Just go buy it.
UNIDENTIFIED FEMALE: It is liquidating. There‘s a distress.
UNIDENTIFIED FEMALE: Something else happened here.
UNIDENTIFIED MALE: Forty-nine a quarter bid for 50,000 Procter in my
hedge fund. I mean, this is good—
UNIDENTIFIED FEMALE: -- that‘s incredible. Nothing has changed for
Procter & Gamble in the past four minutes. Nothing.
UNIDENTIFIED MALE: Well, when I looked at it, it was $61 I‘m not
interested. It‘s at $47, well, that‘s a different security entirely. So,
what you have to do, though, you have to use limited orders because Procter
just jumped seven points because I said I liked it at $49. So, I mean, you
got to be careful.
When Rick Santelli was saying, look, you know, this is a dangerous
market. What I‘m saying you put in a $49 bid for 200 shares for Procter,
if you get hit, fine.
UNIDENTIFIED FEMALE: Right.
UNIDENTIFIED MALE: This is very much 1987, a little different from
2007. So in 1987, there was a breakdown where Procter goes from, say, $50
to $12. All right? And you want to be there at $13. I mean—
UNIDENTIFIED FEMALE: Wait, wait, look. It‘s coming up.
UNIDENTIFIED MALE: It‘s a fast market. It‘s a fast market.
UNIDENTIFIED FEMALE: But the market was down 900 points, we‘re now
UNIDENTIFIED MALE: So, I buy 50,000 at $49. And now, flip it at $59,
and I just made—I just made 500 Gs.
(END VIDEO CLIP)
MADDOW: I just made 500 Gs. Anybody who just did what I said to do
just made hundreds of thousands of dollars, millions of dollars? Boom!
And then it was over.
The stocks go, boink and then come back up. The markets overall still
ended up over 300 points down today. But at one point, they were down more
than 1,000 points.
NASDAQ and the New York Stock Exchange, ultimately, late in the day,
decided to do something kind of amazing. They decided to cancel, to annul
all the trades that took place in that crazy moment. They decided to annul
all of the trades between 2:40 p.m. and 3:00 p.m. Eastern, if those trades
showed a fluctuation of more than 60 percent of what they were before the
What on Earth happened today?
Joining us now is Shannon Zimmerman, the senior analyst at the Motley
Fool, an online investment Web site.
Shannon, thanks very much for being here and helping us make sense of
SHANNON ZIMMERMAN, SENIOR ANALYST, THE MOTLEY FOOL: Great to be here,
MADDOW: What can you tell me as a person that doesn‘t follow
financial news that closely, doesn‘t know that much about markets, what can
you tell me about what happened today?
ZIMMERMAN: Well, Boston Beer went to zero because it‘s priceless.
You‘ve got to love Sam Adams. Basically, market history shows if you have
a rally where you‘ve come as far and as fast as we have since the March
There‘s a psychology, there‘s a psychological aspect to this, where
people are expecting a kind of correction. And so, you have what‘s going
on in Greece, which is a serious story. That‘s been in the atmospherics
for quite a while.
And so, people are expecting a correction. You have Greece happening,
and then, somebody fat fingers a key. Well, lo and behold, you have a big
crash which we had, temporarily at least today.
MADDOW: Hold on, hold on, hold on. Somebody fat fingers a key—
what are you talking about?
ZIMMERMAN: Now, this is not confirmed, as I understand it. But a
trader hit a “B” rather than “M” as in billion rather than million. And
these were S&P future contracts and that sort of caused a cascade, a domino
effect that crashed the market. And that was the big factor—
MADDOW: Hold on, hold on, hold on. Now, this is MSNBC not CNBC, and
I‘m an idiot when it comes to this stuff. So, somebody—
ZIMMERMAN: I don‘t believe that for a second.
MADDOW: Somebody is buying futures, right, on a particular stock, on
the market doing a particular thing?
ZIMMERMAN: In this case, according to reports, it‘s on the market
doing a particular thing, S&P futures contracts, and the magnitude of the
order was quite a bit larger. Then the trader intended maybe he was using
one of the virtual keyboards on his iPad and he fat-fingered it and that
caused a big ripple effect.
MADDOW: So, the trader is trying to buy X million futures, buy X
billion futures, and the market go—
MADDOW: And does the market freak out because one guy does that,
because systems are automated to follow individual large trades like that?
Or does the market freak out because actual human beings are freaked out
because of what this guy did wrong?
ZIMMERMAN: Well, it‘s a little bit—it‘s a little bit of both.
ZIMMERMAN: So, yes, there are machine glitches and machine rules.
And so, certain things happen and machine trading kicks in. But then, once
the market sees that and you can‘t—you know, it‘s an efficient market
most of the time, but you can‘t process news in real time. And so, people
panic and I think it‘s the bad old days of late 2008, lo and behold,
they‘ve got to get out of the market and a lot of people—a lot of people
It looks like a lot of those transactions that happened as a result of
the glitch are going to be rescinded. There maybe some pushback on that
from the people who were the counterparties actually made money, but I
think that‘s probably a wise decision.
MADDOW: So, all of this—a bunch of stocks, as we describe, go to
zero, some other stocks bizarrely go to $100,000 a share from the $30 a
share territory. A few people who are either lucky or very quick on the
trigger make zillions of dollars off of this wild market fluctuation. The
people who profited off it, as well as the people who lost off this
fluctuation will both expect to be made whole—both expect to be brought
back to where they were before this glitch happened because of the
canceling of the trades?
ZIMMERMAN: Well, obviously, if you profited from the trade, you
probably don‘t want to be made whole in the reverse direction. That‘s
going to be—that‘s going to be the rub that the exchange will have to
deal with. You know, Sotheby‘s, they had a Picasso record I do believe.
So, maybe that accounted for some of their pop.
MADDOW: In terms of the glitch being corrected and in terms of trying
to figure out what went wrong, whether or not something like this could
happen to the market again, which is obviously not something that makes
people feel very confident in our financial infrastructure, there remains
the substantive issue, the non-process issue of Greece.
Why is Greece something responsible for markets actually losing
significant percentage around the globe, including our own?
ZIMMERMAN: Right. That‘s a good question. So the fat finger is like
slapstick farce and what‘s happening in Greece is a real tragedy. And so,
that‘s been hanging over the market for several days now and the bailout,
folks thought would contain that, but apparently, that‘s not the case.
And so, really, your viewers are probably readers, or many are readers
of Paul Krugman, he‘s written quite intelligently about this, and there‘s a
way in which the E.U. could come unravel. But there‘s a forced marriage in
some respects, of very economically strong countries in absolute terms and
relative terms like Germany and U.K. and France and then weaker countries
There are not like the United States, there are disparate interests
and sometimes very much competing interests in terms of the economy. And
so, you know, when Germany pushes back on the yield that Greece is going to
have to pay on the debt, it issues—and I know this is a bit technical—
but essentially how much interest are you going to have to pay on the money
you‘re going to borrow, well, that was sort of pre-staging the dustup that
happened. And then Germany kind of relented. But we‘ll see how much
longer that lasts because if you don‘t share common interest, common
economic interest as the eurozone doesn‘t always, that‘s somewhat
problematic question to answer.
MADDOW: Enough to unsettle and agitate markets worldwide, certainly
not quite as dramatically as the guy hitting the B instead of the M key,
while trying to make that one trade.
Shannon Zimmerman, senior analyst at the Motley Fool—thanks very
much for your time tonight. Appreciate it.
ZIMMERMAN: Great to be with you.
MADDOW: So, hot on the heels of the Times Square would-be bomber,
anti-terror crusader Joe Lieberman unveiled his “strip your citizenship
bill” today. And that‘s the last we‘ll hear of it, probably. At least
until it‘s time to do a “greatest hits” of all the worst things Joe
Lieberman has ever proposed in Congress. Then it will be back again, with
Later on, the inexorable political logic of “Los Suns” in Phoenix, los
fans of Los Suns, and why everyone that tells you that immigration reform
just can‘t happen is utterly, stupendously just plain wrong. That is
MADDOW: Senators John Kerry and Joe Lieberman say they‘re going to
introduce the climate bill next week, which is why you‘re hearing lots and
lots of people in Washington say, oh, this is such a bad time to introduce
the climate bill. See, saying it‘s a bad time to introduce something is
just a notorious cowardly lion way of saying you‘re against it.
One might also reasonably argue that this is the best possible time to
introduce the climate bill, that nothing screams, “We need a new energy
policy,” like the images we‘ve all been looking at out of the Gulf these
past couple of weeks. Politically, this might be an opportunity for a
timely reminder that we could stand an update of our old energy policy—
you know, the one drafted by Shell Oil and Dick Cheney and all the other
oil companies that he convened for his energy task force in secret before
Old Beltway common wisdom used to be that you can‘t pass a new energy
policy unless it‘s got more offshore oil drilling in it. That common
wisdom is probably due for an upgrade, too.
We‘ll have more on the day in the Gulf of Mexico oil disaster—
MADDOW: The wait is over. Today, Senator Joe Lieberman officially
introduced his much-hyped, highly-anticipated, almost certainly
unconstitutional “strip your citizenship” bill.
(BEGIN VIDEO CLIP)
SEN. JOE LIEBERMAN (I), CONNECTICUT: Under the Terrorist Expatriation
Act, the State Department would be able to revoke the citizenship of an
American who affiliates with a foreign terrorist organization.
(END VIDEO CLIP)
What this proposal would mean is that the State Department would
decide what a terrorist organization is, right? They would then decide
what constitutes affiliating with one. And then if they think you‘ve done
that affiliating, they just administratively decide that you‘re no longer
We‘ll get to the due process stuff later, bucko. I know you haven‘t
been convicted of anything but I hereby de-American you. Now kindly get on
this plane to Guantanamo. We‘ll talk later.
So excited that Senator Lieberman has been to promote this really
quite radical legislation, it‘s not clear who thinks is going to support
it. Are the Democrats getting behind this? Senator Dick Durbin, the
number two Democrat in the Senate told FOX News today, quote, “I really
believe there are ways to make this country safe without abandoning some of
our most fundamental principles. To remove a person‘s citizenship without
some adjudication in my mind is a step too far.”
OK. But, you know, Dick Durbin‘s a liberal. How about more
conservative Democrats, people who do sometimes support Joe Lieberman on
some of his kookier right wing national security stuff?
(BEGIN VIDEO CLIP)
SEN. DIANNE FEINSTEIN (D), CALIFORNIA: Senator Lieberman proposed
this once before. I took a look at it, then, last night I read my
analysis, and my analysis was that it would not stand a constitutional test
based on law made by the Supreme Court.
(END VIDEO CLIP)
MADDOW: OK. So Democrats, left, right and center, not supporting Joe
Lieberman on his “strip your citizenship” thing.
Maybe the administration would support him on this. I mean, this is
one of the biggest attempted executive power grabs ever since “Co-President
Cheney” left town. The Obama White House has been pretty right-wing on a
lot of national security stuff. Maybe they‘ll support him on this?
(BEGIN VIDEO CLIP)
ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: I have not heard anybody
inside the administration that‘s been supportive of that idea.
(END VIDEO CLIP)
MADDOW: Aww, that was pretty blunt. But, you know, even if the
administration won‘t support him, even if Democrats on the right and
Democrats on the left won‘t support him, there‘s still the Republican
Party. There‘s got to be tons of support from Republicans on this, right?
(BEGIN VIDEO CLIP)
REP. JOHN BOEHNER (R-OH), MINORITY LEADER: If they‘re a U.S. citizen
until they‘re convicted of some crime, I don‘t—I don‘t know how you
would attempt to take their citizenship away. It‘d be pretty difficult
under the U.S. constitution.
(END VIDEO CLIP)
MADDOW: Senator Joseph I. Lieberman, thanks for playing.
As jaw-dropping as the “strip your citizenship” legislation is, there
appears to be no substantial support for it among liberal Democrats, among
conservative Democrats, from the administration or from the Republican
leadership. So, I think that means it‘s not going to be law.
It is, however, going to be an important thing to remember forever
about the judgment of Joe Lieberman and the three guys he got to go along
with him on this one. Welcome to the Senate, Scott Brown. Now you‘re
famous for something else.
Meanwhile, the reporting on the event that prompted the “strip your
citizenship” outbreak of legislative genius, the attempted Times Square
bombing continues to spin—continues to spin rather madly with very
little mooring in fact. As far as we can tell at the show, there are no
new confirmable facts about this case today that were not known yesterday.
But if you‘re keeping track, like we are, of the things that have been
represented as facts in this case and didn‘t turn out to be facts, you‘ll
notice that that list of, “Oops, I guess that isn‘t true” things about this
case has gotten pretty long. Once upon a time, for example, a few days
ago, the guy suspiciously taking off his shirt in Shubert Alley just off
Times Square, a white guy in his 40s—he was supposed to be a suspect,
someone who was involved in the failed bomb plot, right? Now, of course,
we know that the real suspect is Faisal Shahzad, a 30-year-old Pakistani-
born American citizen.
Since then, the more we‘ve learned about Mr. Shahzad, the more we‘ve
gotten wrong. Remember when he was supposed to be from Karachi and then he
was supposed to be from Kashmir and then he was supposed to be from a
little village outside Peshawar? All facts apparently—all
simultaneously co-existing comfortably in the totally un-skeptical news
about this story.
At first, Mr. Shahzad was totally part of the Pakistani Taliban.
Remember? They were claiming responsibility and everything. It was all
planned and put together by the Pakistani Taliban. Well, then the
Pakistani Taliban said Mr. Shahzad was not actually part of their
organization although they loved what he did.
Now, we‘re hearing similarly uninformed speculation about Shahzad‘s
motivation; that he was retaliating for U.S. drone strikes in Pakistan.
There‘s no confirmable fact that proves that‘s true but that‘s the way it‘s
being reported anyway.
It may very well be true that that was his motivation, but I don‘t
know. And here‘s the thing. Neither do you. And neither does anybody who
has printed anything about it in the newspaper, as if it is fact.
Joshua Keating posted an item at the “Foreign Policy” blog today about
the fevered speculation that‘s passing for reporting on this story. I‘m
telling you that and naming him and putting an exclamation point on it
because this one blog post at FP.com makes Joshua Keating a remarkable
outlier when it comes to keeping one‘s head straight about this case.
The lack of skepticism and the lack of reputable sourcing in the news
coverage of the failed Times Square bombing has become one of the most
interesting and certainly one of the most well documented trends to watch
as this story develops. We will keep watching it and we will keep making
fun of people who get it wrong.
MADDOW: -- stories today about the great state of Tennessee. And
being in Tennessee is the only thing these two stories have in common.
First, there is Nashville, and the other inundated communities along
the Cumberland River and the efforts of these communities to recover from
this week‘s devastating flooding. Tennessee officials confirm today that
the death toll in their state has risen to 21, bringing the total number of
storm and flooding-related deaths across Tennessee, Mississippi and
Kentucky this week to 31. At least four people still reported missing.
Nashville‘s mayor today estimated that the damage to his city alone
may top $1 billion. To try to help the people of Nashville, as we‘ve
mentioned before on this show, you can donate to the Red Cross, including
donating by text message. You can donate $10 to the Red Cross by texting
the word “Red Cross” to the number 90999.
Now, in completely different Tennessee news, “Talking Points Memo”
today alerted us to a situation that began unfolding about a month ago in a
Tennessee local courtroom involving a group of folks with a real hankering
a real hankering to see President Obama‘s birth certificate. You can
find out more about them online at a Web site for the American Grand Jury.
The American Grand Jury folks want you to know that President Obama
was a CIA operative while he went to Columbia University. They‘re holding
a trial about it. Elsewhere on their site, they note that he never went to
Columbia at all. They also want to let you know what the mainstream media
won‘t tell you which, of course, is that the Deep Horizon oil rig in the
Gulf was blown up by a North Korean torpedo, obviously.
Of course, their core belief is that President Obama is not a U.S.
citizen and their top priority is to charge him with treason and remove him
They also want to indict Congress. Click here to help.
What they have been doing is trying to use a creative interpretation
of the power of the grand jury to harass and intimidate government
officials. One of their members is a man named Walter Fitzpatrick in
Tennessee. He has been trying to get an actual grand jury in Monroe
County, Tennessee, to charge President Obama with voter fraud for the 2008
When that didn‘t work, Mr. Fitzgerald said then accused the local
grand jury foreman of violating state laws and decided to conduct a
citizen‘s arrest of the local grand jury foreman. He did it on April 1st.
No joke. Mr. Fitzpatrick got some friends to come along and block the
exits to the courthouse reportedly. They then confronted the grand jury
foreman. And, of course, he filmed it and posted it on YouTube.
(BEGIN VIDEO CLIP)
WALTER FITZPATRICK, AMERICAN GRAND JURY: You are under arrest. I‘m
placing you under arrest. You are under citizen‘s arrest. I‘m placing you
UNIDENTIFIED MALE: I‘m asking you to leave the room, sir. I‘ve asked
you to leave the room. (INAUDIBLE), will you escort this gentleman out of
FITZPATRICK: Mr. Fennelly (ph), I‘m making a citizen‘s arrest.
(END VIDEO CLIP)
MADDOW: Instead, it was Mr. Fitzgerald who got arrested. He spent
several days in jail. He was charged with disorderly conduct, inciting to
riot, disrupting a meeting and resisting arrest.
After Mr. Fitzgerald was arrested, one of his fellow American Grand
Jury comrades—can I call them, comrades? He posted this rather
melodramatic plea on YouTube.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: He did this for us. What do you intend to do for
him and for this country? If we don‘t come to his assistance, if we don‘t
get to the courthouse, if we don‘t call him, if we don‘t walk and march on
that courthouse and that sheriff‘s department, we don‘t deserve the
freedoms we have. I know what I must do.
(END VIDEO CLIP)
MADDOW: I know what I must do.
Among those who answered that very self-important call was this
gentleman, his name is Darren Huff. He is a member of the Oath Keepers and
was until quite recently a chaplain of the Georgia militia. According to a
local newspaper, “The Daily Times,” Huff reportedly bragged to a local bank
manager in Georgia that eight or nine militia groups were planning to be at
that courthouse in Tennessee at Mr. Fitzpatrick‘s trial. He said they
would, quote, “take over the city.” The bank manager told the FBI and when
the FBI visited Mr. Fitzpatrick‘s - excuse me, Mr. Huff‘s house, he told
them he planned to show up at the courthouse with his Colt .45 and his AK-
But he reportedly said he would not commit violence unless he was
provoked. When Mr. Huff drove into Tennessee the next day, he was stopped
by state troopers for a traffic violation. He allegedly told them he
planned to take over the courthouse unless not enough people showed up to
That day, officers reportedly observed, quote, “numerous
individuals in possession of openly displayed and concealed firearms in the
area around the courthouse.” The next day, Mr. Huff appeared on a radio
show. He said this.
(BEGIN AUDIO CLIP)
DARREN HUFF, MEMBER, THE OATH KEEPERS: They said, well, we just got
reports that AK-47s and stuff like that are going to show up. And I said,
“Oh, being like the one in my toolbox?” I said, “I‘ve got one.” I said,
“It is legal.” And I said, “It‘s got - I don‘t know, I probably got 300,
400 rounds in the truck.”
(END AUDIO CLIP)
MADDOW: When the FBI heard Mr. Huff boasting about how much he was
excited to bring his weapons to these things that he had planned to take
over by force, they reportedly decided that Mr. Huff had both the means and
the intent to carry out his repeated threats of violence.
They arrested him. They charged him with traveling across state
lines with a firearm with the intent of inciting a riot. Mr. Huff is now
under house arrest. As for Walter Fitzpatrick, “Mr. Citizens Arrest on
YouTube” guy, he‘s awaiting a grand jury in June. Not a grand jury.
Someone man the North Korean torpedoes.
Joining us now is former ATF special agent in charge of the
national field division, James Cavanaugh. During his 33 years with the
Bureau of Alcohol, Tobacco and Firearms and Explosives, Mr. Cavanaugh
worked on high profile cases including Waco, the Unabomber, Eric Rudolph
and the 1986 bombing at abortion provider George Tiller‘s clinic. Mr.
Cavanaugh, thank you so much for coming on the show tonight.
JAMES CAVANAUGH, FORMER ATF SPECIAL AGENT: Thank you for having me,
MADDOW: As you can tell, I both sort of take these groups seriously
and find them scary and find them hilarious. I wonder whether or not you
think - where you think these groups fall on the number line between funny
CAVANAUGH: Well, that‘s the test for law enforcement is to sort that
out, you know, the free speech, the ridiculous speech, the crackpot speech
and these theories about U.N. invasions and government, new world order
takeovers, FEMA concentration camps, if you will - all that crazy and
But if it leads to some violence and, you know, in the past some
of that talk has led to some violence because members spin off and, you
know, concoct a plot to bomb a federal building, attack the IRS, shoot
federal law officers or police.
And so violence can come from the lunatic fringe, and we‘ve seen
it time and time and time again. So it can be very dangerous movement.
MADDOW: In terms of the lunatic fringe organizing itself, looking at
groups like the American Grand Jury or the Oath Keepers - are these groups
novel? I wonder if they are more easily formed because of the organizing
power social media and the Internet. Or do we see groups like this ebb and
flow over time and there‘s always been organizations like this, whether or
not they‘ve gotten a lot of mainstream media attention?
CAVANAUGH: Well, you‘ve hit the nail on the head, really, because
they have ebbed and flowed. And they used to print a lot of newsletters
back in the old days that they nailed around. But the Web, really, has
strengthened these sort of lunatic groups and it‘s also strengthened, you
know, international terrorist groups and cells.
It cements them together. It makes them understand that there‘s
a population of like-minded people like them, gives them support, gives
them, you know, ways to meet. So social media does strengthen them.
Of course, the right-wing lunatic extremists in America that are
these violent anti-government groups, sovereign citizen groups - they‘re
sort of on a high roll now because of the things that are driving their
The economy‘s bad - that helps them. The immigration issue they
exploit tremendously. The Web has driven them. And certainly, in a
Democratic administration, they seem to pop up. We saw them heavy in the
‘90s when President Clinton was in office.
And now, they seem to be back pretty heavy now. And we‘re having
a lot of activity around the country. Just two years ago, we took off the
Alabama free militia and they were saber rattling over, you know, the U.N.
is going to invade Alabama.
And we under-covered them while they were building hand grenades
when they were preparing for the U.N. to come. No, the U.N. is not coming
to Alabama. They don‘t have an army or navy. They don‘t even have a boat
and they couldn‘t take over the senior citizens‘ home.
And so there‘s no need to make hand grenades to prepare for the
attack of the U.N. But these people talk amongst themselves and get so
wrapped up in these crackpot theories about FEMA concentration camps and,
you know, issuing writs and arrest warrants and grand juries that they
And really, it‘s better if you have a loved one that‘s associated
with a group like that or you are, you need to break off and try to get a
dose of reality, because that‘s really way out there on the fringe.
MADDOW: In terms of that last point you‘re making, though, I feel
this is something that I keep coming around to. The more I report on
groups like this and even look at the history of them and some of the
tragic history of them, are there success stories? Are there mitigating
Are there instances or their patterns of behavior that lead to
instances in which responsible figures in these movements say, “I‘m OK with
our ideology but I‘m not OK with potential acts of violence” or “I‘m OK
with everybody in my group except for this guy who I think is taking this
stuff literally and is maybe going to do something that we‘re all going to
Are there things that these groups can be encouraged toward,
essentially, to make the more responsible members among them keep everybody
CAVANAUGH: Well, exactly. I mean, you‘re talking about profiles in
leadership courage here. I mean, there‘s been a few rays of sunlight here
recently where leaders have taken on that mantra to say, you know, there
shouldn‘t be any violence.
There was one example of a group in New Hampshire where the
leader of the tea party said, “We‘re not going to accept any of these
bigots and hate signs and hate people here, so you need to go away.”
So there‘s a person who stood up, you know, for the right thing.
We saw both Speaker Pelosi and Leader Boehner condemn violence against
Congress when there were some Congressmen‘s offices vandalized during some
recent bills on the Hill.
And I recently saw Sen. McCain on the news where he said, “We
want a revolution but we want a peaceful revolution.” And that‘s what
America‘s about. We can not like the way the government‘s spending the
money. We can not like what they‘re doing and we can change them through
the ballot box.
But when you go off into the lunatic fringe or the tassels on the
lunatic fringe who are calling for blood and the blood of tyrants and, you
know, driving their planes into the IRS or concocting a plot to bomb a
federal building, then they‘re way off the charts here.
And really, you‘d be acting just like our foreign enemies. It‘s
a shame that the government and the citizens have to deal with these groups
when we‘re really engaged in a couple of wars around the globe with some
really, really dangerous folks like the al-Qaeda virus that we‘re trying to
deal with in the Hindu Kush.
So the fact that we‘ve got to spend time and energy, you know,
working cases on our own people who might, you know, do violence against
us, it‘s really, really sad. To talk about unpatriotic - I don‘t see how
unpatriotic a person can be than to do some of these violent things against
our own government.
In America, the government is just us. There‘s nobody else.
It‘s just us. We‘re the people. We elect them. We‘re the government.
MADDOW: Former ATF special agent, James Cavanaugh, thank you so much
for your time tonight. I hope you don‘t mind if we call you for advice and
insight on some of these other stories as they keep emerging. I hope they
CAVANAUGH: Thank you, Rachel.
MADDOW: Thank you very much.
MADDOW: Conventional wisdom says you can not pass an immigration bill
during an election year. Well, now that the controversy over Arizona‘s
“Papers, Please” bill has grown so big that it has leaked onto the sports
pages, maybe that common wisdom is in need of an update.
When you have a chance to make your political opponents look
really bad to a really big proportion of the population, generally
speaking, you pick that political fight. That story‘s coming up.
MADDOW: Oil from the BP oil spill reached shore today two weeks after
the well explosion in the Gulf of Mexico. The oil washed up on Louisiana‘s
the Chandeleur Islands. Shoreline clean-up crews were there to see and
assess the damage.
Meanwhile, at the site of the massive leak where hundreds of
thousands of gallons of crude continue to gush into the gulf every day,
efforts to siphon, plug and disperse the oil continue.
A four-story 98-ton steel box arrived at the ruptured well
earlier today. Engineers and welders worked day and night for a week on
the structure that they hope will capture the oil and divert it to a ship
above the surface.
Even though the cap part arrived today, the hookup to that drill
ship will not be complete until this weekend. If successful - so best case
scenario here - the containment dome will be able to suck up about 85
percent of the oil that‘s coming out of the largest of the two remaining
But there are huge 5,000-foot ifs here. These sorts of
structures have never been used at depths even remotely like this, a mile
under water. How the structure will behave in such cold dense water is
The dome was built by a company called Wild Well Control, a
contractor that, for 35 years, has specialized in these kinds of oil spill
disasters, because crises happen so often in the oil and gas industry that
they can sustain a whole disaster sub-industry for decades.
Also a second oil burn was successful yesterday. A small amount
of the oil slick was rounded up with fireproof booms and set on fire by the
coast guard. Then there‘s the proposed oil leak plug. It‘s an idea called
a top kill. It‘s when a heavy liquid is pumped into the well to push back
against the pressure of the oil coming up from below.
But for now, crews are relying on the tried and true method of
chemical dispersants. These are chemicals you‘ve seen dusted over the oil
slick. They basically break up the slick, turning a thin sheet of oil into
tiny droplets, droplets that are more likely to sink and stay out of the
ocean off the shore.
BP has already sprayed 160,000 gallons of dispersant on the oil
slick, not to mention the 6,000 gallons pumped down to the leak well
beneath the surface of the ocean. That‘s more dispersant than has ever
been used on any oil spill ever.
The dispersants do work, sort of. But because oil spills don‘t
have good news, only less terrible news, the chemicals in the dispersants
are themselves toxic. Probably. We don‘t really know what‘s in them.
The companies that manufacture dispersants consider that
information to be proprietary. A company called Nalco makes one of the
dispersants called COREXIT 9500.
Nalco posted a 10-page safety document about COREXIT on the spill
response Web site set up by the oil rig‘s owner, Deepwater Horizon and
warns you to not get the dispersant on your eyes, on your skin or on your
clothing and also definitely don‘t breathe in the vapor.
Touching it may cause irritation. 160,000 gallons of that into
the Gulf of Mexico.
MADDOW: British citizens went to the polls today. They voted for
their members of parliament. And by default then, the prime minister, who
will come from the party that wins 326 seats. Keep that number in mind -
The only problem? Neither the conservatives nor labor nor the
liberal Democrats appear to have won that magic number of seats enough to
elect a prime minister. Our British affiliate, ITN, is projecting that
David Cameron‘s Conservative Party - he‘s the guy in the middle - projected
to win 307 seats.
Prime Minister Gordon Brown‘s labor party - he‘s the guy on the
left - projected to win 255 seats. And the liberal Democrat, Nick Clegg -
there on the right - his party projected to win 59 seats.
If that projection holds, it would mean nobody claiming a
majority in parliament. It would also mean the need for one of the two
major parties to form an alliance with the liberal dems in order to
actually be in charge.
What happens next is anybody‘s guess. Perhaps the U.K. would
like to borrow our supreme court. They love deciding elections.
MADDOW: If you happened to be watching the Phoenix Suns-San Antonio
Spurs NBA playoff game last night, you may have noticed a very rare bit of
politics breaking out in the lead-up to this live national sporting event.
Check this out.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: All the people screwing it up is the politicians.
UNIDENTIFIED MALE: Without question.
UNIDENTIFIED MALE: The governor, the interim governor, I might add.
No - J.D. Hayworth and John McCain - they don‘t want to screw this thing
I have to really take my hat off to Robert Sarver and the Suns
for taking a stance. Now, living in Arizona for a long time, the Hispanic
community - they‘re like the fabric of the cloth, you know? They‘re part
of our community.
And any time you try to do any type of racial profiling or racial
discrimination, this is a federal that now - President Obama, we‘ve got to
do something, because these little lightweight politicians in Arizona don‘t
know what they‘re doing.
UNIDENTIFIED MALE: Everybody knows that and everybody said that on
both sides. Something has to be done about the immigration situation there
and really the crux of this is the wording of that Senate Bill 1070. And
UNIDENTIFIED MALE: Public enemy said it a long time ago. By the time
I get to Arizona, I‘m not surprised. They didn‘t even want it to be a
Martin Luther King Day when John McCain was in. So, I mean, if you follow
history, you know that this is part of Arizona politics.
UNIDENTIFIED MALE: Let‘s talk basketball.
(END VIDEO CLIP)
MADDOW: Hey, you guys, let‘s talk basketball. Striking to see
politics dominating the pre-game just moments before the tip-off the this
ginormous semi-final NBA playoff game. But the Phoenix Suns showing
solidarity with the Latino community wearing their “Los Suns” jerseys
during last night‘s game.
They said they wore them both for Cinco de Mayo and to protest
the new Arizona law. Fans around the arena, holding up signs saying things
like “Los Fans” and “Viva Los Suns.”
Outside the arena, some protesters against the “Papers, Please”
law marched toward the Arizona state capitol wearing “Los Suns” jerseys.
No matter what you think about an NBA team making an overt
political statement, the new Arizona immigration law has captured the
attention of practically everyone. And it has shown the spotlight on the
need for some sort of comprehensive federal immigration reform in this
country, which is one big problem.
The “Papers, Please” law passed in Arizona in 2010. 2010 is
election year, and everybody knows you can‘t do immigration in an election
year. Even Republican Senator Lindsey Graham who has been for immigration
reform in the past, says it can‘t possibly happen this year.
Sen. Graham telling the “Washington Post,” quote, “There is just
not the appetite on either side of the aisle for this issue right now.”
Right. Can‘t do immigration. Even Democrats realize that, right,
(BEGIN VIDEO CLIP)
BARACK OBAMA, UNITED STATES PRESIDENT: The way to fix our broken
immigration system is through common sense, comprehensive immigration
reform. I want to begin work this year. And I want Democrats and
Republicans to work with me, because we‘ve got to stay true to who we are,
a nation of laws and a nation of immigrants.
(END VIDEO CLIP)
MADDOW: I want to begin work this year. Despite the beltway common
wisdom that you can‘t do immigration reform now, Democrats seem to want to
do it. President Obama, in fact, seems really psyched to do it.
While there is a popular political assumption that you can‘t do
something big and serious like immigration reform in an election year,
there is an even more popular political axiom about how to pick a good
political fight. Pick fights that mostly unify your side. Pick fights
that mostly divide the other side.
And if you‘re really going for the gold, pick a fight that makes
the other side show off its least publicly appealing face.
(BEGIN VIDEO CLIP)
ANDERSON COOPER, HOST, “AC 360”: You called the president an
Indonesian Muslim-turned-welfare thug and a racist in chief.
MARK WILLIAMS, HEAD OF THE TEA PARTY EXPRESS: Yes.
COOPER: I mean, is that the kind of -
WILLIAMS: That‘s the way he‘s behaving.
COOPER: But in his -
WILLIAMS: But if he cares to be the president of the whole country -
COOPER: Do you believe he‘s Indonesian? Do you believe he‘s Muslim?
Do you really believe he‘s a welfare thug?
WILLIAMS: He‘s certainly acting like it.
(END VIDEO CLIP)
MADDOW: Mark Williams, everybody, head of the Tea Party Express, the
ostensibly principled, small government conservative group that has not
only endorsed Arizona‘s biggest of all big government “Papers, Please” law.
It‘s now taking a lead role in beating back the boycotts against the state.
They‘re circulating a petition to support Arizona‘s crackdown on
illegal immigration. Quote, “We at the Tea Party Express stand with those
great patriots in Arizona. They should be applauded for having the courage
and conviction to take on this problem.”
The Tea Party Express making sure that they are way out in front
as the face of the anti-immigration right. Democrats lining up for
immigration reform have the “Papers, Please” law to thank for the
unbelievably advantageous political line in the sand here.
To be for immigration reform this year, this election year, is to
stand against “Papers, Please.” To be against immigration reform - uh-oh,
Republicans - is to stand with the pro-“Papers, Please” folks. And that in
politics is called a slam dunk. Maybe even a three-pointer.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: In the fourth, Frye. Puts down another three.
Channing Frye has been a sharpshooter today with fifteen for the Phoenix
(END VIDEO CLIP)
MADDOW: How did we ever get along before Google Earth? You can find
satellite images of almost anywhere on earth. For example, here is
Rockefeller Center, where I am right now. Here‘s Fenway Park in Boston.
Go Sox. Here‘s the Hoover Dam. Do we have a Hoover Dam? Oh, yes. So
Here‘s another satellite image courtesy of Google Earth. Check
this out. Can we put that side by side with the Hoover Dam so you can see
how big this thing is? This is at the same scale here, this thing that‘s
actually bigger, quite a bit bigger than the Hoover Dam.
This thing is also a dam. Who had the resources and engineer
know-how and the sheer will to build something that big? Was it the
Chinese, the Russians? No, it was actually beaver. Buck-toothed, flat-
tailed, furry beavers built a beaver dam that is twice the size of Hoover
The mega beaver dam located at the southern edge of Wood Buffalo
National Park in northern Alberta in Canada. It stretches more than 2,790
feet across. That‘s more than half a mile long, more than 1,000 feet
longer than the Hoover Dam, built by beavers.
For comparison, the Hoover Dam used 4.4 million yards of concrete
and took about 7,000 workers, 4 ½ years to complete. The great Canadian
beaver dam was made of sticks and rocks and mud by three-foot long, semi-
aquatic rodents. It‘s been under construction apparently since the 1970s.
Beaver colonies build dams to provide still deep water to protect
themselves against predators and to float food and building material. But
they have never built one this big before that anybody knows about.
The Canadian mega beaver dam is the biggest one ever. Before
now, the longest one anybody knew about was found by biologists near Three
Forks, Montana. It measured about 2,140 feet long, built by a bunch of
beavers who are now feeling slightly inadequate.
Scientists say the beavers built the Canadian dam in an extremely
remote and inaccessible place, which means no human interference, which
means one big honking dam. It‘s remarkable what a species can accomplish
when you‘re not killing them to make men‘s top hats.
This dam might have gone undiscovered had an ecologist not found
it by accident while trolling Google Earth in 2007. Voila, Beaver-topia.
Thank you, Google Earth. Thank you, hard-working beavers.
One last thing to leave you with tonight that has nothing to do
with Beavers. I mis-pointed at the leader of the conservative and the
liberal Democratic leader, David Cameron and Nick Clegg. I got them wrong
before. I apologize for the mistake. This is David Cameron. And we don‘t
have Clegg. That‘s awesome.
“COUNTDOWN” with Keith Olbermann starts right now.
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