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Msnbc Live at 6 p.m. ET, Wednesday May 25th, 2011

Read the transcript from the Wednesday 6 p.m. hour

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Guests: Sherrod Brown, Sam Stein, Shushannah Walshe, Alex Wagner, Simon

Rosenberg, Ari Belmar, Gretchen Morgenson

CENK UYGUR, HOST:  Good evening, everybody.  I‘m Cenk Uygur. 

Now, did you see that stunning Democratic victory last night?  Just when the GOP thought they were on the rise, they lost one of their safest seats, and now they‘re shaking in their penny loafers throughout the country. 

Do they still wear penny loafers?  They‘re Republicans.  They might. 

Democrat Kathy Hochul shocked Washington by beating Republican Jane Corwin in a normally safe GOP district, 47 to 43 percent.  Tea Party candidate Jack Davis got nine percent. 

The key issue, of course, was Medicare.  Hochul promised to defend it;

Corwin backed Paul Ryan‘s plan to end it.  And that turned out to be a terrible idea. 

So, for Democrats, the lesson seems to be incredibly clear.  But of course the man most responsible for this Republican disaster, Paul Ryan, is still in denial. 

(BEGIN VIDEO CLIP)

REP. PAUL RYAN ®, WISCONSIN:  When a Democrat runs as a third-party Tea Party candidate and spends a couple million dollars, it‘s going to have an effect.  So I think the primary problem is the third party that got involved here. 

(END VIDEO CLIP)

UYGUR:  Right.  It had nothing to do with Medicare.  That‘s why Jane Corwin was frantically backpedaling away from your plan in the last week before the election, right?

But some on the right actually see things a lot more clearly.  Listen to what Karl Rove‘s American Crossroads Group said.

“This election is a wake-up call for anyone who thinks that 2012 will be just like 2010.  It‘s going to be a tougher environment, Democrats will be more competitive.”

And the powerful GOP congressman Dave Camp was caught recently stating a very simple truth—“People in my district like Medicare.”

I‘ve got news for you.  People in every district like Medicare.  It‘s one of the most successful government programs in history. 

It‘s why we‘re seeing people rise up to support Medicare in town halls across the country.  But in those town has, we‘re also seeing what the radical right actually thinks. 

Just check out what Georgia‘s Rob Woodall recently told one of his constituents. 

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE:  The private corporation that I retired from does not give medical benefits to retires. 

REP. ROB WOODALL ®, GEORGIA:  Hear yourself.  Ma‘am, hear yourself. 

It‘s just a difference of opinion.

You want your government benefits.  You want the government to take care of you because your employer decided not to take care of you.  My question is, when do I decide I‘m going to take care of me? 

(END VIDEO CLIP)

UYGUR:  Now, do you understand her question?  What‘s she supposed to do if her previous company won‘t give her insurance once she retires?  Who‘s going to insure her? 

She‘s got no choices.  That‘s what she‘s trying to explain to you. 

That‘s why she loves her Medicare.

But Woodall basically went and told her to go eat dirt. 

Then, in a different video, in that same town hall, Woodall says he won‘t give up his own government-sponsored health care because it‘s free. 

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE:  You get government-subsidized health care, but you are not obligated to take that if you don‘t want to.  Why aren‘t you going out on the free market in the state where you‘re a resident and buy your own health care?  Answer the question.  Why haven‘t you bought health care?

WOODALL:  Oh, I‘m sorry.  I thought I did.  It‘s because it‘s free. 

It‘s because it‘s free.

(END VIDEO CLIP)

UYGUR:  I love that.  So you want to keep your lovely free government-run health insurance, but when your constituent asks, what is she supposed to do, you yell at her and say, time to take care of yourself, buddy. 

Now, look, that‘s the Republican ideology in full display.  And that‘s why they got their ass handed to them last night. 

Can I say that?  Well, we‘ll find out. 

Just moments ago, the Senate voted against the Ryan budget plan.  Fifty-seven senators opposed it, including five Republicans: Scott Brown, Susan Collins, Olympia Snowe, Lisa Murkowski, and Rand Paul, who all apparently like their seats and would like to keep them. 

Joining me now is Senator Sherrod Brown, Democrat from Ohio.  He serves on the Appropriations Committee. 

Senator Brown, your party has to be fairly ecstatic today as you just got almost all the Republicans to sign on to what appears to be a disastrously unpopular Medicare plan. 

SEN. SHERROD BROWN (D), OHIO:  Yes, we‘re excited, of course.  I mean, winning a special election like that is a positive thing, a fairly big deal.  But the victory is—I mean, it may be for Democrats, but the victory really is for Medicare and for American values. 

I mean, we‘ve had a consensus in this country for a long time over Medicare, over civil rights, over women‘s rights, over safe drinking water, on all the things that we‘ve done together.  And a group of radicals in the Republican Party with a whole lot of money behind them have tried to destroy that—collective bargaining rights, Medicare, voting rights in many cases now, civil rights in other cases.  And the voters say stop every time they have done it. 

And the Republicans, for years, they don‘t like Medicare, mostly because they don‘t like it when a government program is popular and well run.  And we know Medicare has about a two percent or three percent at the most overall administrative cost, way, way less than private insurance.  We know how to deliver health care at the VA and Medicare. 

So, ideological Republicans—and too many of them are now, not really representing their people particularly well—ideological Republicans just can‘t stand it that this government program actually works for the public in so many ways. 

UYGUR:  Right.  Now, at the same time, president—I‘m sorry, Vice President Joe Biden—he says he‘s thinking of running in 2016, but we don‘t want to get ahead of ourselves.  OK.  Vice President Joe Biden is negotiating with the Republicans, and, look, he says there‘s about a trillion dollars in cuts that they have already great upon, apparently. 

If that involves Medicare cuts, is that a bad idea for the Democratic Party? 

BROWN:  Well, it‘s a bad idea for the country.  What we did in the

health care bill that the media and Republicans don‘t want to acknowledge -

and the media mostly haven‘t for whatever reason—is we have a lot of things in that health care bill—taking away insurance companies that were part of Medicare and plowing money back into the Medicare system; making sure that people don‘t overutilize various kinds of services and various ways of making Medicare more efficient, but not undermining or cutting services. 

There are a lot of things in that bill that particularly Senator Whitehouse and some others have worked on that are going to mean we‘re going to save some money in Medicare, but you don‘t do it by shifting costs to seniors.  The whole Republican plan doesn‘t save Medicare anything as a program, it just shifts the cost from the Medicare system to seniors, so that seniors will literally, under the Republican budget, will play $6,000 or $7,000 more out of pocket in the years ahead for the same Medicare benefits they get now. 

Too much subsidy for insurance companies, too much subsidy for drug companies, too much subsidy for the medical device manufacturers.  That‘s not the way to do Medicare. 

UYGUR:  Right.  Now, Senator Brown, I do want to get a little bit more specific, though. 

In your state of Ohio, you‘ve got 76 percent of the voters saying they oppose cutting Medicare in order to trim the deficit.  And again, even to trim the deficit, 76 percent oppose.  So if the White House and the Republicans come to a deal where they cut Medicare further, would you be opposed to it? 

BROWN:  No.  I don‘t like that.  I don‘t think we have to cut a deal like that. 

I think we do the millionaire surtax, we cut the costs of prescription drugs.  Not cut Medicare, but cut the costs of prescription drugs by using generics, by using—by reimportation from Canada, where drugs are cheaper than they are here for the same drug, in the same package, in the same dose, by allowing the government to negotiate drug prices the same way the VA does with the big drug companies. 

Those are the kinds of savings I mean.  You don‘t cut services to Medicare, you cut costs by pushing some of these providers like the drug companies, like the insurance companies. 

UYGUR:  All right. 

And finally, Paul Ryan says he‘s going to reboot this, I think for the third time, this plan.  And like we said in the beginning, you just got almost all of the Republicans to sign on to it in the Senate.  Is that something that the Democrats are going to focus on in 2012?  And given the election that just happened, is that an incredibly encouraging sign for you guys? 

BROWN:  Yes.  You can tell a lot about a political party or any of us by—and our values about what kind of budget you write.  And their budget not just goes after Medicare, it goes after Pell grants for college students.  It doesn‘t fund education the way that we should in this country. 

We‘ve got to get to budget.  We‘ve got to close the budget deficit.  But our first obligation is jobs.  Our second obligation is to make sure that we‘re preparing for the future by taking care of senior citizens through Medicare and Social Security, and by providing opportunities for children and young people.

And their budget does none of that.  It‘s all about tax cuts for the rich and privatization of everything from college student loans, to Medicare and all the other things they have tried to do over the years in between. 

UYGUR:  Right.  All right.  Ohio Senator Sherrod Brown, thank you so much for joining us. 

BROWN:  Thanks.  Good to be with you.  Thanks.

UYGUR:  Really appreciate it.

BROWN:  Thanks.

UYGUR:  All right.  Now we go from Capitol Hill to the north lawn of the White House. 

Let‘s bring in Sam Stein, White House correspondent for “The Huffington Post.”

All right, Sam.  First, what are they doing?  The Republicans, almost all, just voted for this Ryan Medicare plan which they just saw destroy them in the 26th District.  Do they have any idea what they are doing?  Are they going into this hunky-dory, like, yeah, let‘s get slaughtered in our own elections?

SAM STEIN, WHITE HOUSE CORRESPONDENT, “THE HUFFINGTON POST”:  Well, I think they‘re being driven by the Tea Party base.  I think what you saw with Newt Gingrich last week, or a week and a half ago, where he came out and said, well, let‘s make the Paul Ryan system voluntary, and then got piled on my conservatives, I think they‘re all very much worried about that same reaction happening to them.  In many ways, this Paul Ryan Medicare plan has become a litmus test for the party, and all Democrats have to do is sort of sit back and watch as they eat their own. 

UYGUR:  But Sam, now, you‘re at the White House, and we were getting word, as I mentioned, that Biden is coming out and talking about how they‘ve got at least a trillion dollars in cuts already.  We‘re going to talk about that throughout the show.

But if the Democrats then come out and say, all right, we will cut Medicare, not as much as the Republicans want, but we will cut it, does that give away their entire advantage?  And why on God‘s green earth would they do that? 

STEIN:  Well, it‘s a good question, and it‘s tough to figure out what exactly the specifics are with respect to these talks.

Last night, when the president released a statement on the win, he didn‘t mention Medicare at all, and it caused some people to get concerned that, in fact, he was positioning himself to make Medicare cuts down the road.  This morning, progressives were given a sign of reassurance of sorts when Treasury Secretary Tim Geithner, followed by Gene Sperling, a top economic adviser her, both piled on with respect to the changes that Paul Ryan is advocating, saying that they‘re way too distract, that it ends the system as they know it, and they‘re a nonstarter for negotiations.

So, of course, the devil is going to be in the details, but you‘re probably right.  If they were to take some of the ideas in the Paul Ryan plan and apply it in their own for deficit reduction, it would sort of mute the rallying cry that you‘re seeing right now. 

UYGUR:  So, I mean, is there any sense from the White House that they recalibrating in light of the 26th District results?  Because I know the previous idea was, we have to cut spending—the Republicans say—all of Washington says we have to cut spending, please let‘s cut spending.  So we‘ll agree to whatever they want.  Hey, look, they won in 2010.

But now you see, well, look, there are some ways that the American people clearly do not want you to cut spending.  Is there a recalibration going on? 

STEIN:  Yes, I think there is.  And it will be interesting to note how quickly the White House and allied Democratic groups move from this to start reintroducing or re-touting aspects of the president‘s health care law, which, as Sherrod Brown properly noted, included various provisions to decrease the cost of Medicare and create savings in the health care system. 

Most specifically, the president has been touting an independent board to find savings in the Medicare system.  So, you know, in 2010, it was very much the shoe is on the opposite foot.  Democrats were entirely on the defense of health care. 

What I think last night‘s vote showed is that, in actuality, health care might prove to be a benefit for the Democrats.  And specifically, the Affordable Care Act, which Obama helped pass, might actually be to the Democrats‘ benefit. 

UYGUR:  Sam, one last quick thing here.

STEIN:  Sure.

UYGUR:  Bill Clinton had a very concise explanation of how this could help the Democrats.  I want to have you watch it for a second. 

(BEGIN VIDEO CLIP)

WILLIAM JEFFERSON CLINTON, FMR. PRESIDENT OF THE UNITED STATES:  I

just think his Medicare proposal is, on the merits, wrong.  Medical costs will continue to go up and older people will use less, get sicker and die quicker, or they will be poorer because they‘ll have to spend so much of their money on health care. 

(END VIDEO CLIP)

UYGUR:  Will the White House learn from that very simple, concise message of former President Clinton? 

STEIN:  Is Clinton channeling Alan Grayson there?  Gee, they‘re going to die quicker. 

It all comes down to rationing I guess, right?  Because in 2010, it was, do you want a board of bureaucrats rationing your care when you‘re old?  And that was an effective argument for Republicans, and it was used probably the most among all campaign ads during that cycle. 

In this instance, you‘re seeing the exact opposite.  It is, do you want the private insurance industry to ration your end-of-life care?  And Bill Clinton is very good at summarizing things in sound bites that people can easily digest, and I think it would behoove the Democrats to do the same. 

UYGUR:  All right. 

Sam Stein, White House correspondent for “The Huffington Post.” 

Thanks for joining us.

STEIN:  Thanks.

UYGUR:  All right.  When we come back, last night was a message to Republicans—extreme policies have consequences.  Now Governors Rick Scott and Chris Christie are starting to feel the heat.  Is the tide turning on Republican bullies?  We‘ll have some evidence for you guys. 

And here she comes.  America, get ready for the madness.  Sarah Palin, off the top rope and into the race. 

Well, by the way, there‘s also new details of a ridiculous pro-Sarah Palin movement which you‘re going to love and a devastating book that‘s actually against her.  We‘ll give you all of that. 

And two years ago, Mitt Romney said loud and clear, let Detroit go bankrupt.  He called President Obama‘s auto bailout “tragic.”  Now he‘s taking credit for it.  And that stunning con job will be revealed ahead. 

(COMMERCIAL BREAK)

UYGUR:  As the GOP presidential field starts to solidify, unhappy Republicans can‘t help but keep looking for the next big thing.  Michele Bachmann, Rudy Giuliani and George Pataki are all said to be announcing decisions in the next month or two.  But the 800-pound “Mama Grizzly” in the room is, of course, Sarah Palin.  Will she run or won‘t she? 

Well, a new documentary about her life filmed in secret over the last few months provides some clues.  It‘s called “The Undefeated,” which is a little ironic since she lost in 2008.  But facts are of no concern to the Palin camp, apparently.

And according to a reporter from RealClearPolitics who has seen the movie, “The film is poised to serve as a galvanizing prelude to Palin‘s prospective presidential campaign, the first step in Palin‘s effort to rebuild her image.”

It debuts next month in the pivotal primary state of Iowa.  After that, it opens in New Hampshire, South Carolina and Nevada. 

Gee, I wonder why they‘re doing that.  Of course.  That certainly indicates she‘s running. 

The film ends with an on-screen caption that says, “From here, I can see November.”  Is that subtle enough for you? 

All right.  Now also consider the $1.7 million house Palin just bought in Scottsdale, Arizona.  Many think that it will be her base for a 2012 run, but a Palin presidential bid would have to overcome a ton of baggage, including the scathing details contained in a new book written by a former aide.

The author of “Blind Allegiance,” Frank Bailey, joined Palin‘s team back in 2005.  He was part of her inner circle and at times her enforcer. 

He describes her as a petty, selfish person more interested in money and power than in being governor of Alaska.  The details are amazing, and let‘s discuss those right now. 

I want to talk to Shushannah Walshe.   She‘s a “Newsweek” contributor of co-author of “Sarah From Alaska.”

Shushannah, thanks for joining us tonight. 

SHUSHANNAH WALSHE, “NEWSWEEK” CONTRIBUTOR:  Hi.  Thanks. 

UYGUR:  All right.  First of all, on the appearance of her coming into the race, boy, there‘s a lot of clues there—the house, the movie.  There‘s apparently preparations being made. 

Is this for real? 

WALSHE:  I absolutely think that she‘s getting ready to run.  I think that she still hasn‘t made the decision 100 percent with her husband Todd.  And that‘s where the decision will be made, her and her husband. 

I‘ve been speaking to aides, and they‘re very forthcoming in that they may not know until right after she has made the decision, much like for her decision to resign in 2009.  But I‘ve always thought since 2008 that she‘s going to run.  And these signs show that, absolutely, she is going towards that decision. 

UYGUR:  Real quick, let‘s talk about that goofy movie that they‘re making.  RealClearPolitics says that, “It is rife with religious metaphor and unmistakable illusions to Palin as a Joan of Arc-like figure,” and it‘s got images of lions killing a zebra and a dead medieval soldier with an arrow sticking in his back to dramatize the anti-Palin ethics complaints. 

So, that seems like, here we go again, she‘s the victim, but this victim will rise out of a cloud like Newt Gingrich and come back to slay all the dragons. 

WALSHE:  Well, this movie, which was—the story was broken by my co-author, Scott Conroy, in a huge scoop—but this movie looks like it‘s going to be a lot like “Going Rogue,” where there are characters and there are good guys and there are bad guys.  And there really isn‘t much in the middle. 

And that‘s really how Palin and her closest allies view things.  There are people that are her backers, are her allies, and if you‘re not, then you‘re out of there.  And there‘s really no gray or negotiation.  And so this movie continues that thinking of the bad guys and the good guys. 

UYGUR:  Well, Shushannah, talking about good guys and bad guys, I mean, when we turn to Frank Bailey‘s book, wow.  It paints an image of her that is devastating, and it‘s backed up by 50,000 e-mails that he has apparently saved, which is a stunning number.  I must be getting that wrong. 

He says in the book, “I‘m convinced that her priorities and personality are not only ill-suited to head a political party, or occupy national office, but would lead to a disaster of, well, biblical proportions.” 

Wow.  That‘s an insider saying that.  What does that tell you about Palin? 

WALSHE:  Well, I think that you have to remember a couple things. 

One, the book does have 50,000 e-mails there.  It‘s a scathing tell-all.  But you have to remember that the Palin camp looks at people like Frank Bailey, like this book, as they really kind of take inspiration from it. 

As I said before, now he‘s one of the bad guys, he‘s trying to keep them down.  And they really do—it sounds crazy—but get inspired from people that trash them.  And that is also something that Scott Conroy said in his article about the movie, that people—that they feature people that say nasty things about Palin because it doesn‘t just inspire them, but her supporters also. 

And so you‘re going to see her using this tactic, using the people that are trying to keep her down or say nasty things about her, to try to get support. 

UYGUR:  But, Shushannah, I mean, it‘s kind of a funny thing.  Right?  So, you go out and do atrocious things, and when people attack you for doing atrocious things, you go, oh, my God, what a victim I am. 

And the book has, I think, two excellent examples of that.  I want to tell you the one about Piper and get your reaction to it, because you‘ve covered her a lot.

“The Washington Post” explains in the review of the book, “Bailey also

helps smear a neighbor who complained about excessive tourist traffic

around the governor‘s mansion.  Palin sent out her daughter Piper out to

sell lemonade and then derided her neighbor for protesting children at

play.  Soon, the neighbor was portrayed on conservative blogs as ‘sick,‘

‘unhinged‘ and ‘drug-addicted.‘”

I mean, isn‘t that using your kids as a political ploy? 

WALSHE:  I actually knew about this story beforehand.  It‘s a really unfortunate story and really is kind of the worst part of Palin‘s personality, or what can happen, in using really everything to go against people that have done even minor infringements on her like this.  And it‘s really just a horrible story, but it really shows a lot about her personality in that she does see small things like this infringement that we‘re talking about, and blows it completely out of proportion, and uses it to inspire her people to support her. 

UYGUR:  Yes.  And it‘s beyond all bounds of reason.  But speaking of people supporting her, one last one.

WALSHE:  Sure.

UYGUR:  The author talks about how they had these elderly conservative citizens who rallied to her cause and who volunteered for her and spent a lot of time.  And one of them gave his lucky fedora to her, which she then threw in the trash and called “icky,” and she called him “The Crazy Men‘s Club.”

I mean, how insulting is that to your own supporters?  Doesn‘t it at some point have to hurt her support even within conservatives? 

WALSHE:  It could, but I think a story like that, I don‘t know how many people—you have to remember that the people that support her—and this isn‘t going to help in a presidential campaign, because these people already support her—they have undying, unconditional support from her.  The bloggers that we were just talking about that backed her up, they are still her supporters. 

But when you go into a presidential campaign, there are going to be people that aren‘t supporting you, that are—reporters are constantly asking you questions.  And that‘s where she may run into difficulties. 

Stories like this I don‘t think can really stop her at this point.  I think, again, they‘re going to use things like this book, other things really to inspire her to say, yes, I should run, I should support the people out there that are supporting me. 

UYGUR:  She always wins.  If do something loathsome, and people attack me for it, then you should support me.  Well, then you can‘t lose in that logic. 

All right.  Well, we‘ll see.  My guess is that she will ultimately lose fairly badly. 

But Shushannah Walshe, “Newsweek” contributor and co-author of “Sarah From Alaska,” thank you for joining us tonight. 

WALSHE:  Thank you. 

UYGUR:  Now, when we come back, “Mr. Business,” Mitt Romney, was one of the biggest critics of the Obama auto bailout.  He called it a very sad circumstance for this country.  Today he‘s trying to take credit for it.  I‘m not kidding. 

It‘s unbelievable.  It‘s a con job of epic proportions. 

And the former CEO of Massey Energy is under fire.  We thought it was an accident when 29 miners of his miners died last year, but a shocking new report shows it was all about greed.  We shine a light on that tonight. 

(COMMERCIAL BREAK)

UYGUR:  And now for our “con job of the day.”  We have Mitt Romney‘s legendary flip-flop on the auto bailouts.  The man who said, it was a terrible idea.  He‘s now trying to take credit for it.  Are you kidding me?  This might be the biggest con job we have ever seen. 

Yesterday, Chrysler paid back nearly $6 billion to the U.S.  government.  That‘s a major chunk of what it received in the auto bailout.  GM had already repaid its entire loan.  They are both profitable now with GM recently having a great quarter.  So, with these car companies roaring again, that would seem to be a pretty clear vindication of President Obama‘s decision to loan the companies money and by the way, to save hundreds of thousands of jobs here in the United States.  So, you can‘t blame the democratic national committee for gloating a little bit and pointing out who was wrong to oppose his particular bailout.  

(BEGIN VIDEO CLIP)

UNIDENTIFIED MAN:  You said, quote, “If General Motors, Ford and Chrysler get the bailout that their chief executives asked for yesterday, you can kiss the American automotive industry good-bye.  

UNIDENTIFIED MAN:  If you write a check, they‘re going to go out of business.  

(END VIDEO CLIP)

UYGUR:  But now Romney‘s camp is arguing that it was their idea to save the car companies.  Come on!  How can they possibly say that?  Romney‘s spokesman told “New York Times” today, quote, “Mitt Romney had the idea first.  You have to acknowledge that.  He was advocating for a course of action that eventually the Obama administration adopted.”  What?  They say it was Romney‘s idea to push the companies into bankruptcy first, but that‘s where they were already.  That was the first thing that happened under the president‘s plan.  Then they got the money to revive those companies which Mitt Romney 100 percent disagreed with, and apparently was 100 percent wrong about.  In case you‘re still not sure, though, you want to see the headlines for Romney‘s “New York Times” editorial where he laid out his original plan, the editorial was called, quote, “Let Detroit go bankrupt.”

Now, he wants to take credit for the resurgence after calling them plan tragic.  Now, do you see why some in the conservative movement also find this guy to be a joke?  Mitt Romney‘s ridiculous effort to rewrite history is easily our con job of the day.    

(COMMERCIAL BREAK)

UYGUR:  Welcome back to the show everybody.  Joining me now is our power panel.  I love this.  They‘re here to discuss and maybe debates, some of the day‘s biggest stories. 

With me is Alex Wagner, she‘s a reporter for the Huffington Post and also an MSNBC analyst.  Very powerful.  And Ari Berman, contributing writer for The Nation Magazine, and the author of “Herding Donkeys: The Fight to Rebuild the Democratic Party and Reshape American Politics.”  And Simon Rosenberg, president and founder of the New Democrat Network. 

All right.  Let‘s get along guys.  First question, will Democrats agree to cut Medicare during budget negotiations?  Now, yesterday, Vice President Biden signaled that such big-ticket items might actually take a hit.  Let‘s take a look at it, first. 

(BEGIN VIDEO CLIP)

VICE PRES. JOE BIDEN (D), UNITED STATES:  I made it clear today, we have to—revenues are going to have to be in the deal.  And everybody knows that at the end of the day, we‘re going to have to make some really tough decisions on some of the big-ticket items, but I think we‘re in a position where we will be able to get to well above the trillion dollars pretty quick in terms of what would be a down payment on the process. 

(END VIDEO CLIP)

UYGUR:  Alex, I‘m going to start with you.  First, does this indicate that we have not actually done any tax increases yet, that the revenue side is not on the table yet, the whole trillion is in spending cuts?

ALEX WAGNER, THE HUFFINGTON POST:  This is—this is the Democrats‘ efforts to get some skin in the game on the question of entitlements, but fundamentally Cenk, it is to get the Republicans to the table on tax increases.  You know, the Republicans have been I think pretty masterful in terms of framing this debate and really getting the Democrats to come out and say, OK, we‘ve got to tackle Medicare.  For a long time the White House set entitlement programs are not an immediate threat to the economy.  They have since, they have changed course on that, but, you know, given the manna from heaven, that is, you know, the Paul Ryan GOP Medicare plan, there‘s no way the Democrats are going to get anywhere close to tackling the program in the same way that the Republicans have which is.  

UYGUR:  I know, not in the same way.  I know not in the same way.  But Simon, I want to ask you about it.  Because look at what Steny Hoyer said, he said, I have said it over and over again, everything needs to be on the table.  Medicare is one of the things that needs to be on the table.  Well, isn‘t that going to totally blow their advantage that they just got and we had evidence of in the 26th district race?

SIMON ROSENBERG, NEW DEMOCRAT NETWORK:  Well, we‘re clearly in the early stages of these negotiations.  I think as Alex said, one of the most interesting things that I keep wondering about this negotiations is how could there be any negotiations if the Republicans are saying that revenue increases are off the table?  I mean, there‘s no way to have a serious conversation about reducing the deficit unless there‘s substantial new revenue into the government, and so...  

UYGUR:  No, but that‘s obvious, Simon, look, I know, they‘re tough guys and they always want to say, oh yes, we‘ll never going to raise taxes.  OK, that‘s fine and we don‘t have a deal, right?  I get that, but how about our side?  I mean, when you talk about progressives, saying, hey, we should cut Medicare, does that  make any sense given what‘s happens?

ROSENBERG:  I think if the deal that the Democrats strike this year includes large substantial cuts to Medicare as opposed to reforms that will save money, and I think these are different things.  Because I think there‘s a lot of modernization and health care in general that could still get done, that wasn‘t done in the health care bill last year.  I think if there cuts as opposed to modernization, I think it could be trouble in the democratic base.  There‘s no doubt about that.  

UYGUR:  All right.  Ari, is there a real difference between cuts and reform of Medicare?

ARI BERMAN, WRITER, “THE NATION”:  Well, there could be.  There could be, for example, letting an independent Medicare advisory board address this issue or there could be Paul Ryan‘s voucher program.  I mean, that‘s a pretty big deal right there.  And what Republicans are doing, they are begging Democrats to bail them out on this issue.  They realize they made a huge mistake embracing Paul Ryan‘s plan which we saw play out last night in New York City.  And now they‘re saying to the Democrats, come on, throw us a lifeline, and it would just be crazy if the Vice President Biden and the Democrats did that, if they let Republicans get off the hook for what they have already voted on. 

UYGUR:  Ari, that is absolutely correct.  If they throw a lifeline and say, all right, we‘ll help you cut Medicare, oh, what are you doing?  That‘s crazy.  All right, but that‘s my opinion.  Let‘s go to the next question, why do Republicans want to attack Elizabeth Warren so bad and should President Obama give her a recess appointment?  Now, remember, Warren testify to Capitol Hill yesterday, during at which point, she got a confrontation with the republican Representative Patrick McHenry about what time she was allowed to leave.  How absurd?  Warren said staff agreed to let her go by a certain point, but McHenry said, he had made no such agreement.  And basically called her a liar.  Let‘s watch that first. 

(BEGIN VIDEO CLIP)

ELIZABETH WARREN, LAW PROFESSOR:  We had an agreement. 

REP. PATRICK MCHENRY ®, NORTH CAROLINA:  You had no agreement. 

WARREN:  We had an agreement for the time this hearing would occurred. 

MCHENRY:  You‘re making this up.

WARREN:  You asked it.

UNIDENTIFIED MAN:  Oh please.

MCHENRY:  This is simply not the case.  This is not the case. 

WARREN:  I. 

UNIDENTIFIED MAN:  Mr. Chairman, you just did something that I—I‘m trying to be cordial here, but you just accused the lady of lying.  

MCHENRY:  She‘s accusing me of making an agreement that I never made.  

UNIDENTIFIED MAN:  I think you need to clear this up with your staff.  

(END VIDEO CLIP)

UYGUR:  Alex, why do the Republicans hate Elizabeth Warren so much?  Not hate personally, but as in getting that position.  They don‘t want her to get it under any circumstances.  

WAGNER:  Right.  Yes.  That was awkward.  I think they actually don‘t like her personally either, Cenk.  I mean, look, Elizabeth Warren was largely the architect of the Consumer Protection Financial Bureau, and Republicans have not liked her since the beginning.  And that‘s not just because of what she‘s trying to do on Wall Street, and reform banks.  And the housing industry doesn‘t like her.  She was releasing some reforms for mortgage documents, and they don‘t like that.  They think it stifles innovation on the mortgage side, I mean, no one on... 

UYGUR:  Here‘s what I want.  Here‘s what I want.  I want innovation stifled in the financial industry.  

BERMAN:  Cenk, can I jump in for a second?  Because I was at this hearing yesterday and I covered it.  And it was incredibly surreal, but it wasn‘t surprising.  Because Republicans have been attacking Elizabeth Warren and the Consumer Financial and Protection Bureau for a very long time.  They attacked it during the Dodd/Frank debate and they‘re attacking it now.  Because the people that gives the Republican Party the most money, the biggest banks, they pay day lenders, the mortgage brokers, all of those people don‘t want to be regulated.  They don‘t want to.

UYGUR:  Absolutely.

BERMAN: ..and that‘s what these attacks are happen.  

UYGUR:  Ari, Ari, should he do a recess appointment?  Should President Obama say, all right, well, they‘re not going, apparently they‘re not going to confirm anybody anyway, the Republicans have said that.  Why not put her in?

BERMAN:  He has no choice but do to a recess appointment because Republicans in the Senate have already said they won‘t confirm anybody, not just Elizabeth Warren, anybody without change for the bureau, which the Obama administration is not going to agree to.  

UYGUR:  Simon, do you agree to recess appointment?

ROSENBERG:  Yes.  And I think what‘s the biggest mistake tactically that the Republicans are making is the more they attack her, the more that president has to appoint her.  The more he has to keep her because it looks like he‘s giving in to the Republicans in the banks.  Otherwise, if they had just left this alone, this may not—this may have been—the president may have had a choice.  He doesn‘t have a choice anymore.  He‘s got a plan B. 

UYGUR:  Well, I hope you guys are right.  I would love it if he did a recess appointment.  And if he has no choice, in my book, that‘s fantastic.  Put her in.  She‘s the one that fights for all our consumers.  One last question for you guys.  Is the GOP war in the middle class backfiring?  Look at this new poll on Governor Rick Scott.  It‘s got him at 29 percent approval rating, with 57 percent disapproving of the job he‘s doing as governor.  I have a bold prediction.  I don‘t think he‘s going to make it out of a first term.  I think somehow he‘s going to get thrown out of office.  Am I crazy?  Alex, go. 

WAGNER:  No, well, I mean, getting thrown out of office is one thing.  I think, look, in that same poll, I think it was 54 or 50 percent of the voters thought that his budget plan was unfair.  And I think that that‘s something the Republicans are going to have to work on, is this idea that people that got us into this mess are the rich, and the people that are bearing the burden of it disproportionately are the poor and the working class.  And when you‘re saying to workers in Florida, you‘ll going to have to take parts of your salary and put them forward to your pension, and you‘re going to flash education spending by $2.5 billion, it feels like unfair.  And the Republicans thus far have not sold the country and Floridians, a package that I think is palatable to them.  

UYGUR:  Ari, will he go as far as me?  Maybe, not make it out of the first term?

BERMAN:  Well, he never should have been governor in the first place, Cenk.  This was a guy who went before he was governor, ran the nation‘s largest for-profit hospitals.  And he was accused and pled guilty to 1.7 billion in Medicare and Medicaid fraud.  It was the largest health care fraud settlement in history.  Somehow Floridians elected him, but almost instantaneously they didn‘t like the guy.  And maybe they should have looked a little bit closer at who they elected before they actually decide to put them in the governor‘s office. 

UYGUR:  Simon, yes, absolutely, last word.  

ROSENBERG:  What‘s amazing is that republican numbers all across the country are tanking, the congressional generic is already showing substantial movement.  What‘s happening to Rick Scott is somewhere what‘s happening to the national republican brand.  It‘s happening very quick, and I think what‘s happened is the American people realize the Democrats want to give them more, the Republicans want to give them less, they‘re not happy about it, and it‘s having a very significant impact across the country.  The Republicans are in trouble very early.  I think one of the great stories you‘ll going to be covering is how much the republican presidentials are trying to distance themselves from the early Paul Ryan politics of this Congress. 

UYGUR:  Oh, no question.

ROSENBERG:  It‘s going to be one of the great stories we‘re all going to be following for months.  

UYGUR:  Simon, you end on a completely correct note.  Governor Christie is in a little bit of trouble, he‘s lost seven points, Kasich in massive trouble, Walker is in trouble, they‘re all in trouble.  

ROSENBERG:  They‘re all in trouble.  

UYGUR:  All right.  Great panel tonight.  We appreciate it.  Alex Wagner from Huffington Post, Simon Rosenberg from New Democrat Network, and of course Ari Berman from The Nation.  Thank you all for joining us. 

BERMAN:  Thank you.

UYGUR:  We really appreciate it. 

WAGNER:  Thanks, Cenk.

ROSENBERG:  Thanks.

UYGUR:  All right.  Now, when we come back, we‘re finally seeing some signs that the government is ready to crack down on the banks.  That would be awesome.  But whatever happened to the people responsible for the epic financial collapse of ‘08?  Well, my next guest is going to explain that.  We‘ll be back.              

(COMMERCIAL BREAK)

UYGUR:  Finely, someone in the government is going after the big banks.  Thank God.  We‘ll tell you who that is, and how guilty those banks really are, when we come back.   

(COMMERCIAL BREAK)

UYGUR:  We are finally seeing some signs that the government or at least part of it is starting to crack down on banks that causes mortgage crisis, and are still profiting off of it now.  Now, over the last few weeks, New York Attorney General Eric Snyderman has reportedly opened a probe and requested information from Wall Street Banks about their mortgage securities operations during the credit boom.  He specifically requested meetings with representatives from Bank of America, Goldman Sachs, and Morgan Stanley.  The investigation has not yet been made public, but Monday, a source closely investigation revealed that the probe is being expanded to include J.P. Morgan Chase, UPS—I‘m sorry UBS, UPS has nothing to do with this, and Deutsche Bank. 

All right.  You go get them, Eric.  The inquiry appears to be quite broad.  Snyderman has requested mortgage-related documents and could be looking into fraud, God bless his heart.  Now, can he pull off this investigation that the rest of the government seems wildly disinterested in?  Well, I hope so.  Or are the financial institution who cause our mortgage crisis simply too big to jail?

Let‘s try to find out.  Let me bring in Pulitzer Prize winning columnist and assistant business, and financial editor for “The New York Times,” Gretchen Morgenson, she‘s out with the new book, “Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon.”  Gretchen, great to have you here tonight.

GRETCHEN MORGENSON, “THE NEW YORK TIMES”:  Thanks, Cenk, thanks for having me. 

UYGUR:  All right.  First, let‘s talk about this.  There‘s a theory out there that it wasn‘t the bankers, that it was the government, that, they, you know, forced the bankers to make his risky loans, and Republicans have literally said, to minorities and poor people, and the banks didn‘t want to do it, they just got forced into it.  Is there any truth in that?

MORGENSON:  You know, it‘s so interesting Cenk, that there is so much blame to go around in this whole crisis.  And of course, as you know, anything that could achieve trillions in losses really cannot be just a few people at the wheel here, but, you know, really what these lenders did, as we are finding out more and more, even now, you know, four years after the crisis erupted.  Lenders actually targeted minorities and targeted first-time home buyers, people who are unsophisticated, with some of the most poisonous mortgages that you can imagine, mortgages that had low initial interest rates and then would explode higher, really mortgages that were very difficult for even the most sophisticated even higher net worth individuals to pay, so it really wasn‘t that they were forced to do it, these were very lucrative loans. 

UYGUR:  Yes, no question about it, of course, like nobody made them make billions of dollars, but why, I think a lot of people wonder about that, they say, why is making these risky loans more profitable for them?

MORGENSON:  You know, it really is true that the more poisonous the loan, the more, let‘s say there‘s a prepayment penalty associated with it.  If you‘re a borrower that has a little bit, you know, maybe dicier credit, you have to pay a higher rate of interest.  These are all elements that go into the profitability of a loan.  And so, the loans that were given to people who were maybe on the lower rungs or who had never had a home before or no credit, they really paid through the nose in the banks profit mightily.  

UYGUR:  So, now, they got crushed by that, right?  But there‘s another set of victims.  Because all these mortgages would then get wrapped up into these securities, that then the big banks would sell off to their clients.  

MORGENSON:  That‘s right.  

UYGUR:  But meanwhile, they were betting against their clients, weren‘t they?  And if they were, isn‘t that fraud?

MORGENSON:  Well, some firms were betting against their clients.  And of course, they argue that it was not fraud, because they disclosed that they were making bets or disclosed that they might be making bets against these very clients that they were selling these products to.  Now, that is their arguments.  You know, I think that what you just have to think of as an everyday person is, is that the kinds of, you know, investment banks that I want to buy products from, where they‘re actually betting against me.  And I, you know, really would have to say no, I think that those are the kinds of practices that normal, everyday people would find questionable. 

UYGUR:  So, how have they been getting away with this for all this time?  Because, obviously the collapse happened in 2008.  Finally, Eric Snyderman is going after them, it appears, you know, right now, what is the federal government been doing this whole time and why haven‘t they‘ve been doing anything?

MORGENSON:  Well, I think Cenk, it‘s very important to remember that the regulators who were really charged with watching over these markets in the buildup to the boom, i.e. 2003, ‘04, ‘05, ‘06, were really asleep at the switch, they‘re not really doing their jobs.  And so, what that has ended up doing is not only did it, not protect people during the boom, it also meant that there were very few facts, figures and less data than ever to bring cases now.  So, it‘s a double failure that‘s really, really problematic.  

UYGUR:  Look, I think realistically, those banks give a lot of money to those politicians.  And that‘s why a lot of people didn‘t want to go after them.  One last real quick question for you, Gretchen, is this thing fixed at all, or is it going to blow again?

MORGENSON:  Well, you know, we did have the Dodd/Frank law that went into effect to try to, you know, fix some of the problems, but my feeling is that it did not fix the biggest problem, which is that we have large politically connected institutions that will not be allowed to fail.  

UYGUR:  Yes, that is a huge, huge problem.  All right.  Gretchen Morgenson, author of the new book, “Reckless Endangerment.”  Thank you so much for joining us this evening.  We really appreciate it.  

MORGENSON:  Thanks, Cenk.

UYGUR:  All right.  We will be right back with profits over people. 

You‘ll want to see this.                       

(COMMERCIAL BREAK)

UYGUR:  Just over a year ago on April 5th, 2010.  There was an explosion at Massey Energy‘s upper big branch coal mine in West Virginia as you remember.  It killed 29 miners leaving big questions about the safety practices of Massey Energy.  Now, a new report commissioned by former West Virginia Governor Joe Manchin reveals just how negligent Massey safety practices were and how little they have done to change things over the past year.  The independent report said, quote, “Massey exhibited a corporate mentality that placed the drive to produce coal above workers‘ safety.”  The report went on to detail how the company‘s safety practices haven‘t improved at all since the disaster last year, which is amazing, and incredibly callous.  Here‘s another quote from the report. 

More than a year after 29 men died in the upper big branch mine, there is strong evidence that Massey has not changed the manner in which it operates its mines.  So, how in the world do they avoid more scrutiny after the disaster?  The investigator said that Massey used the leverage of jobs it provided as an attempt to control West Virginia‘s political system, casting a specter as regulators, politicians and even community residents as enemies.  The report specifically stated that former Massey CEO Don Blankenship instilled fear in local politicians by spending, quote, “vast amounts of money to influence elections.”  The report also revealed that the prevalence of the preventable but deadly disease black lung was significantly higher in Massey mine victims. 

The national rate for disease among miners is about 3.2 percent, but among the upper big branch victims, 71 percent had black long.  Look at that unbelievable disparity.  You know why that happened? Because the guys running this company didn‘t give a damn.  They just wanted to make their millions.  Blankenship got $2 million upon retirement.  You know that in this July, he‘s getting another $10 million? That‘s why he didn‘t care what happened to those workers, whether they got black lung or they died in that mine.  It is revolting.  Is that the kind of America we want?  I don‘t think so. 

Thank you for watching, “HARDBALL” is next.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.                                                                            

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