updated 11/4/2011 3:27:41 PM ET 2011-11-04T19:27:41

Guests: Ron Suskind, Raul Grijalva

RACHEL MADDOW, HOST: Good evening, Ed. Thank you very much, my
friend.

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

I grew up in the suburbs east of San Francisco, in the East Bay. My
parents still live in the house I grew up in.

And, San Francisco, love it or hate it, San Francisco is one of the
most visually stunning places in America. It is a compact city. There`s
no sprawl. There really can`t be because San Francisco is surrounded by
water on three sides. It`s very, very hilly.

And it`s got all of this great interesting architecture. In part
because of the sad fact that so much of the city had to be rebuilt all at
once after president 1906 quake and fire that flattened and burned a lot of
the city.

So, when you are in San Francisco, really everywhere you work is an
amazing vista. You know, of the Golden Gate Bridge looking north, or the
Bay Bridge looking east, which frankly is just as beautiful as the Golden
Gate.

There`s these views that you get suddenly out of nowhere of dramatic
valleys half-shrouded in fog while the rest is in bright sunlight. There
are these giant beautiful radio towers up on twin peaks in San Francisco,
that in the fog sometimes looks like there are sailboats suspended in
midair. The same view is even better at night.

San Francisco is an incredibly, visually dramatic place.

And so, as a kid grows up, leaving San Francisco and driving home to
the East Bay was always sort of a visual letdown, right? The suburbs are
lovely, but it`s just not the same.

On the drive from San Francisco east, to the East Bay suburbs, I
always felt that there were only two points of visual interest. For a kid
in love with the bright lights of the big city, there were two points of
visual interest on that whole drive.

One, interestingly enough, was the Mormon temple located on a
hillside in Oakland, California, right in the middle of a residential area.
At night, it stands out like a prop from a movie set in some future
century.

The other point of visual interest is this: the Grand Lake Theater.
Grand Lake Theater is a great old art deco theater that opened in 1926 in
Oakland. It is magnificent. The Grand Lake was date night movie theater
for me when I was growing up.

But even more important than the theater, itself, was its freaking
amazing, huge, awesome animated sign, which you can see from everywhere.
And which growing up I thought was the single coolest thing about living in
the East Bay, visually, at least. Now, I am 38 and I think that it might
still be the visually coolest thing about the East Bay.

This I want to show you -- this is a picture of the grand lake
theater today, of its marquee. We proudly support the "Occupy Wall Street"
movement, closed Wednesday to support the strike.

Today, the entire city of Oakland, California, was subject to what
they call a general strike. According to the suggested chant list from the
"Occupy Oakland" folks, the idea is "strike, occupy, shut it down, Oakland
is people`s town." Also, "Every hour, every day, the occupation is here to
stay." You get the basic idea.

What you`re looking at right now is live footage -- live footage --
of the general strike in Oakland tonight.

The idea of a strike is usually pretty narrow, right? It`s a pretty
narrowly targeted idea. It`s people working at a specific place stopping
working there in order to get them to treat them better as employees.
That`s the idea of a strike. The idea of a general strike is not a
targeted action against any one place of business, against any one
employer. It`s general.

It`s less about raising a beef with one particular target of the
strike than it is about establishing that the people striking are all on
the same side together.

Oakland has had a general strike before. It was 1946, right after
the end of World War II. There was a sort of not huge-scale labor dispute
in Oakland. Retail store clerks went on strike against downtown department
stores because they wanted better pay and better conditions. There were
picket lines and some heated confrontations. There were people arrested.
But it was proceeding price much as you would expect out of your average
labor strike.

Until it became not just a dispute between those stores and the
people who worked for those stores, but rather a dispute in which the
police intervened forcibly on the side of the stores, against the people
who were striking, against the employees.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: They beat us all out of the alleys, pushed us
with those damn billy clubs. I was black and blue here for months. The
trucks followed right behind them, went on in and unloaded. Then they went
back to get more.

It wasn`t bringing in strike breakers necessarily that started the
general strike. You know, I thought about that a lot since that. We`d
seen strike breakers.

But the thing was using the police force that we were paying taxes
for to beat us off our own streets.

(END VIDEO CLIP)

MADDOW: The police don`t work for the stores any more than they work
for the striking workers, right? Police aren`t supposed to take a side in
a labor dispute. They`re just supposed to enforce the law.

But that morning in December 1946, when people saw police breaking
the strike up, siding against the workers and bringing in the strike
breakers, the general strike spontaneously happened. Bus drivers saw what
was happening. They parked their buses and left them there. People in
other businesses just walked out of their jobs.

It was a spontaneous strike, taking sides with the store employees
who sort of otherwise been doing their own thing. The general strike in
Oakland in the `40s was not a big organized union-led thing actually. It
happened spontaneously and went on 2 1/2 days.

Maybe this is apocryphal but the way they tell the story of it now in
Oakland is that in the 1946 strike, every business in the city was shut
down for two days and a bit. The only businesses that were allowed to stay
open during the strike were food stores and pharmacies so people could get
their medicine and also bars.

But bars with an asterisk. Bars would be allowed to stay open during
the strike, the general strike in 1946. This maybe apocryphal but this is
what they say -- only if they agreed to two conditions. One, they could
only serve beer and not hard liquor. And, two, they had to agree to put
their jukeboxes out on the sidewalk so the general strikers could enjoy the
music.

This year, "Occupy Oakland" started as one of the dozens, if not
hundreds of occupy encampments that have sprung up all over the country, to
stand up for the 99 percent, right? Stand up for the 99 percent of
Americans who are underserved by our economy and by our political system
which has been captured by the 1 percent.

But on October 25th of this year, the actions of the Oakland police,
again, helped turn what had been a sort of small, sort of isolated
movement, at least comparatively speaking, into a much, much larger
movement. Before the Oakland police made the bad decision to wage
essentially a shock and awe campaign of militarized force against that
little protest in downtown Oakland, before that, this was act the size of
that protest. A few dozen tents and a few hundred people in Oakland.

Since the actions of the Oakland police on October 25th, the protests
have not only come back, look, they`re now much larger -- much, much larger
than they were before. Even San Francisco across the bay, a very
progressive city in its own right, and a much bigger one, does not have as
much support, as many people, as many energy now as "Occupy Oakland" does.
With the renewed energy, which comes in part thanks to police making a bad
decision about how to treat this on October 25th, "Occupy Oakland" today
decided to do what Oakland does -- they called for a general strike across
the entire city.

Today, thousands of Oakland residents took to the streets for what
were reportedly, by local press calling these things the largest
demonstration in the East Bay since the days of the Vietnam War. And in
the East Bay, that`s where Berkeley is. They know something about
demonstrations against the Vietnam War.

The "Occupy Oakland" demonstrators along with hundreds of teachers
and students and nurses marched through downtown gathering at the city`s
biggest banks, and a show of force that is set to culminate tonight at the
port of Oakland, of course, the fifth biggest port in the country, one of
the major conduits of imports from China into our country.

The Oakland police remained mostly on the sidelines today. A number
of local businesses including some of those banks just closed their doors
today. Some city and port workers were sent home early today. Oakland
school district reported that 18 percent of the city`s teacher force joined
the strike today.

But, again, this is not a labor strike. This is not a specific
strike against a specific organization or a specific business. This is a
general strike which is a rare thing. And it means that it is not about
taking on any one business to try to get them to change. In fact, a lot of
businesses in Oakland, not just the Grand Lake Theater, support the idea of
standing up for the 99 percent.

For example, the Men`s Warehouse clothing stores put up these signs
today, "We stand with the 99 percent," closed Wednesday, November 22nd.

While some businesses in Oakland closed altogether today, some stays
open but decided to go cash only so that the big banks and credit card
companies would not be taken their pound of flesh from the local businesses
today.

But again, this is general, right? There is not a specific target.
There`s not a specific agenda. This is about saying the system shouldn`t
only work for the rich, period. But as "Occupy Oakland" quite radically
keeps things vague, keeps things general on the West Coast, we are heading
into a weekend where people are expected to take some very, very specific,
very personal action as part of the 99 percent.

This Saturday, November 5th, has been unofficially declared Bank
Transfer Day across the country. It`s part of the move your money project
which is encouraging people to quite literally move their money out of big
banks and into community banks and credit unions, even though the big day
isn`t until Saturday, this is a movement that is already spreading across
the country.

(BEGIN VIDEO CLIP)

REPORTER: In Seattle, BECU credit union has seen the number of new
accounts jump from a norm of 7,000 per month to 16,000 in October, alone.

TODD PIETZSCH: You`re going to get free checking. You`re going to
get in some cases you`re going to get interest with your checking. You`re
the not going to pay to see a teller. You`re not going to pay to have
funds transferred from a savings account.

(END VIDEO CLIP)

MADDOW: The chief operations officer of the nine branch Michigan
Schools and Government Credit Unions said this week, quote, "I would say
it`s ranging from a 25 percent increase in new members to a 50 percent
increase at one of our branches all within the past several weeks." The
head of the credit union national association tells "Reuters" during the
past month credit unions saw huge demand for now accounts, numberings at
least in the, quote, "tens of thousands." People moving their money out of
the big banks and into smaller credit unions and locally owned
institutions.

The "Occupy Wall Street" movement seems to have already inspired
that, inspiring people to get their own personal money out of the big
banks. Even though all of that has already happened, this weekend is
expected to see thousands, if not tens of thousands more people do the
same.

As we talked about last night on the show, organizers of the Bank
Transfer Day tell us over 71,000 people have pledged to close their
accounts at big banks this weekend. MoveOn.org also is now saying that
they`ve received commitments from over 60,000 people to do the same, to
move their money this weekend.

And meanwhile, tomorrow, it`s occupy the treasury. "Occupy Wall
Street" members and union members, particularly nurses, are going to be
marching on the U.S. Treasury Department with a demand that is as specific
as the general strike in Oakland is general. Their demand is for a tax on
financial transactions. Talk about hitting Wall Street directly.

After Wall Street blew up in 2008 at the end of the Bush
administration, one of the things the Obama White House seriously
considered was a tax on moving money around, a tax on financial
transactions. Granted a very, very, very, very small tax proportionately
speaking, but given how many millions or billions of financial transactions
are done on Wall Street, it could raise significant money from a place that
could afford to pay it, by taxing an activity that had proved to be rather
dangerous to the health of the economy. It`s essentially a win, win, win.

This idea had not only on the table in the Obama White House, in the
aftermath of the collapse, but apparently, the head of the OMB, the White
House office guy, the head of the Office of Management and Budget under
President Obama, Peter Orszag, wanted to do this, wanted a financial
transactions tax. President Obama is reported to have said of a financial
transactions tax at a meeting, quote, "We are going to do this."

So, we did not do this. As yet, it has not yet happened. The man
who first reported the "we are going to do this line," Pulitzer Prize
winner author Ron Suskind, joins us next.

(COMMERCIAL BREAK)

MADDOW: The scene tonight in Oakland, California. Where the port of
Oakland, the nation`s fifth largest port, now says it is effectively shut
down because of the "Occupy Oakland" general strike. General strikes are a
rare thing in this country.

Tomorrow, the action is expected to shift to Washington, where occupy
the treasury gets under way. Protesters tomorrow are calling for something
very specific. Even as this general strike unfolds in California, and this
is a pretty remarkable scene, those protests are very much focused on
keeping their message general. Tomorrow, we`ll see a very specific demand,
the demand for a financial transaction tax. That`s something President
Obama was reportedly in favor of in the wake of the Wall Street meltdown at
the end of 2008, but it is something that has not yet happened despite his
support for it.

Here now to tell us why, Pulitzer Prize winning journalist, Ron
Suskind, author of "Confidence Men."

Ron, it`s great to have you back. Thanks for being here.

RON SUSKIND, AUTHOR, CONFIDENCE MEN: Nice to be here.

MADDOW: "Occupy Wall Street," the "we are the 99 percent"
protesters, have not been specific in their demands on purpose. This
protest tomorrow is specific. You report that the financial transactions
tax is something the Obama White House seriously considered doing. How do
we know that?

SUSKIND: Well, we know it because I interviewed everybody involved
in long, taped interviews.

What`s fascinating here is during those tough days in the spring of
2009 when the markets were jittery, the president said to Peter Orszag, his
top budget official, what happens if he have a bond option, treasury bonds
and no one shows up? Orszag said one thing you could do that would settle
the bond markets is a financial transaction tax, it will raise revenue, it
will tamp down wildly speculative trading and behavior. That`s actually
something that restores confidence in a system that deep down is broken.

Mind you, Rachel, we have a situation here where even Wall Street
knows deep down it needs medicine. It may be strong medicine. It`s like a
patient that`s sick and maybe even radical surgery in terms of
restructuring.

This is something deep down they know and actually it`s something
that now people, because they have this book, "Confidence Men," they`re
saying my goodness, the president wanted to do this on many instances and
his Wall Street-centric, Wall Street adoring adviser says, no way, we`re
not going to let him do it.

It didn`t happen. But now, many of the advisers, Lawrence Summers
and others, are gone. The question is: where does Tim Geithner stand on
the financial transaction tax? It could raise a lot of money. It will
tamp down exactly the kind of volatility that is roiling the global
markets.

The question is: where does the president stand? The question is
being called.

MADDOW: And you specifically put the finger on Larry Summers for
having stopped this, even though this is something as a policy that he had
been in support of, public in support of earlier in his career. With
Summers gone, is it possible that something like this could happen? How,
for example, how stiff would the resistance be from the bond market? From
the bond traders, from Wall Street, itself?

SUSKIND: Well, it depends on who you`re talking about. Those who
want to bring stability to some of these bond markets are saying, look,
this is just what you need. Those who are making a lot of quick kills on
bits of informational advantage, if you will, in the giant debt trading
machine that now dominates Wall Street`s earnings, it has more years --
well, of course, those people don`t want the bread taken off their table.

But what we`re talking about here is how to help create a sustainable
model for our financial markets so we`re not running up and down these wild
parabolas, the waves that, frankly, America can`t take. We can`t take that
in terms of the life most people lead, in terms of their kitchen table
budgets as well as American business.

What`s fascinating, Rachel, is there`s no love for Wall Street among
Fortune 500 companies, much less Main Street America. The question is:
will this president now step up when clearly the call is very strong to do
something?

MADDOW: Ron, let me ask you one slightly wider perspective question.
I really believe that "we are the 99 percent" movement is a resonant and
effective movement. And because their strategy is to stay put, I think it
is going to continue to be for a long time. I think they have tapped
something that`s very true for almost all Americans.

From what you have reported about how this administration works, what
are the major points of resistance now to the president doing things,
pursuing policies that would help the 99 percent, that would help the
economy? Even by means of putting Wall Street sort of back if their place.

SUSKING: Well, look, I still think that he and many leaders around
the world are feeling like, you know, when all things map out, he`s got to
be on the side of the banks. On the side, essentially, of supporting with
the public purse, with the federal might, the existing, though broken,
system of banking in the United States.

The Dodd/Frank bill, that reform is really a mile wide and an inch
deep. It doesn`t deal with the major structural issues that frankly are
still really hurting and causing fear, the kind of fear that slows down job
growth, that slows down investment.

You know, what`s holding him back? That`s a question people are
asking. Maybe they`re waiting until later when it`s going to be an issue
that they want to use in the campaign next year. I think that deep down,
though, the president is of several minds here. He sometimes has had
trouble, as I show in the book, making the tough call.

Once again, I think we`re having a "yes but" situation, a lot of
hamlet. At this point he needs to be more Titus Andronicus. He needs to
step up and swing the sword.

But the fact is the president has real trouble doing that and has for
his entire term in office.

MADDOW: Ron Suskind, Pulitzer Prize winning author of "Confidence
Men" -- Ron, thank you for your time and insight on this night. It`s good
to see you. It will be interesting tomorrow to see those protesters in
Washington really calling the question.

As Ron puts it, a "yes but" moment, no longer appropriate.

All right. Today, let the record show was a sort of more useful day
than most in Washington. There were actually some signs of life there,
seriously, not kidding. That`s coming up next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

REP. JERROLD NADLER (D), NEW YORK: What happened to Republican
pledges we weren`t going to symbolic resolutions anymore? No one is
threatening the national motto. It`s there. It`s on our currency, it`s on
our walls, it`s there.

It`s our national motto. No one denies that fact. Nothing will
change when we pass this resolution.

It was our national motto yesterday. It`s our national motto today.
It will be our national motto tomorrow.

This resolution is simply where it`s designed to distract attention
from our real problems to a nonexistent problem.

(END VIDEO CLIP)

MADDOW: There`s no challenge to our national motto, according to
Jerry Nadler. Obviously, he`s some sort of communist.

Democratic Congressman Jerry Nadler on the House floor last night
defending the existence of our national motto.

President Obama is on route to the G-20 Summit in Europe, but before
he left town today, he had parting words of his own for the Republican-run
House which really did spend last night doing a floor vote affirming the
motto of the United States of America is still "In God We Trust." They
were changing the motto. They were not suggesting getting rid of it. They
were not doing anything to the motto except affirming that it exists.

And here today was the president giving them "what for" for that.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Everybody here, we are
Americans. We`re not people who sit back and watch things happening. And
if Congress tells you they don`t have time, they`ve got time to do it.

We`ve been, in the House of Representatives, what have you guys been
debate? John, you`ve been debating a commemorative coin for baseball.

You had legislation reaffirming that "In God We Trust" is our motto.
That`s not putting people back to work. I trust in God, but God wants to
see us help ourselves by putting people back to work.

(APPLAUSE)

(END VIDEO CLIP)

MADDOW: God is OK with being on your $5 bill, John Boehner, but
would like to see you and the Congress do something about the economy. God
and your constituents both, maybe.

Tomorrow, the U.S. Senate is expected to vote on another piece of
President Obama`s jobs bill, what we talked about with Amy Klobuchar
earlier this week. She introduced it -- $50 billion worth of investment,
building and repairing roads and bridges and the like.

Although Republicans used to be for infrastructure, they are now 100
percent uniformly against it. And not only that, on the last
infrastructure vote in Congress the Republicans filibustered, Republicans
not support in blocking it from two conservative Democrats from Nebraska`s
Ben Nelson and Montana`s Jon Tester.

Not this time. At least we think not this time. Senator Ben Nelson
and Senator Jon Tester both now saying they will at least think about now
siding with the Republicans to filibuster infrastructure again. They will
at least think about voting to allow a vote on the bill. Instead of
joining the Republican blockade, which is progress. Really, really, really
conservative Democrat Joe Manchin of West Virginia signed on to the bill as
a co-sponsor with Senator Klobuchar.

So, yes, we do sort of expect Republicans to be unified against jobs
bill at this point, even on infrastructure, which they used to support, but
if the Democrats stop splintering on their side of the issue, that frankly
is a big political leap forward for the Democrats.

And for the record, as a matter of strategy, Democrats getting
together on this 100 percent, no defections, is a necessary step toward
getting some Republicans to peel away from their own party and vote for
this thing.

Everybody says a jobs bill cannot pass, even roads and bridges. But
keep your eye on this one. It is moving.

And yet further signs of life in Congress, Democrats making a ruckus
these last couple days about Republican efforts in the states to make it
harder to vote, to cut the time for early voting or not let you vote
without documentation you have never had to produce before and that
hundreds of thousands if not millions of eligible American voters do not
have. Democrats on the House judiciary committee calling for hearings on
the new laws to make voting harder -- new laws in 13 states and new laws on
the table in twice as many more.

They`re joined on the Senate side by Democrat Bill Nelson of Florida
who`s been calling for the Democratic-led judiciary committee in the senate
to get up out of D.C. and go to the states and have field hearings on the
new laws that make it harder to vote.

Democratic Congressman Keith Ellison today introducing two new bills.
One would allow you to register and then vote on the same day in federal
elections. The other bill from Congressman Ellison would ban states from
requiring you to show photo ID when you vote, since millions of eligible
voters in the country do not have photo ID.

As I said, we are seeing some signs of life in Congress right now.

Also in the Obama re-election campaign, signs that they are taking
seriously these Republican laws to make voting so much harder in 2012.
"The Wall Street Journal" reporting today that President Obama`s former
White House counsel, a big powerful, big deal of a lawyer named Bob Bauer,
is heading up efforts to battle back the Republicans on this with a multi-
pronged effort that includes stopping these laws when they can be stopped
and helping voters targeted by these laws figure out how to vote anyway
though it has been made so much harder for them.

That the White House picked a lawyer like Bob Bauer shows this will
drive -- that this drive to protect voting will not just be a matter of
educating people about what ID they need and how to get it. The White
House picking its own chief lawyer shows it is ready to bring serious legal
muscle to this.

It`s also about suing and blocking these laws in the courts when they
can. Lots of times covering the news on politics means winging about D.C.
I will admit it. You know the best luck, all conviction, while the worse
are full of passionate intensity.

But days like this, yates shmates. This is one of those weeks when
it finally seems like there is passionate intensity to go around in
Washington. And even some good strategy on the Democratic side. There are
signs of life in Washington, D.C. I`m telling you.

(COMMERCIAL BREAK)

MADDOW: Every 10 years in this country, we have a census. The
Constitution says we have to. It`s so the Kenyan for president can better
plan to round up the Republicans and put them in prison camps.

Sorry, accidentally swapped my notes for a Michele Bachmann
transcript. Actually, the Constitution says we have to have a census every
10 years in part so we can make sure the government is still
representative. We use census data to figure out how many members of
Congress each state gets for example. An every 10 years , we use census
data to redraw the districts from which we elect members of Congress.

That should be a technocratic, totally apolitical thing about making
sure our Congress accurately represents our people. But, of course, it
isn`t. What actually happens is the party in power draws weird, crazy
lines on maps in order to give themselves an advantage on Election Day,
grouping mostly Republican or mostly Democratic voters together to make
that district an easy race for their party for the next decade.

Behold the results of gerrymandering. The fourth district in
Illinois, that makes sense. How about Florida`s 22nd district? Oh, right,
that`s the obvious place to put it. Oh, and how about Arizona`s second
district? Really?

But in Arizona recently, voters decided they wanted to change all of
this. They no longer wanted whichever party happened to be in power when
redistricting takes place to have so much influence over drawing the lines.
In 2000, Arizona, in its wisdom, passed Prop 106, also known as fair
districts, fair elections.

Prop 106 said the state legislature would no longer have the
authority to draw the districts. Instead, an independent commission would
do the job. Two Democrats, two Republicans and an independent, putting
power, quote, "in the hands of a politically neutral commission of citizens
who are not active in partisan politics and who will serve without pay to
create fair districts that are not gerrymandered for parties or incumbent`s
advantage." Awesome!

Now, that the census is over the Arizona Independent Redistricting
Commission has been working, working on new district maps on behalf of the
people of Arizona. They were about a month away from finishing their work.
They submitted a draft which is not yet final.

But here`s the thing. Republican Governor Jan Brewer doesn`t like
their product. Republican Governor Jan Brewer so does not like what this
commission has proposed or is in the process of proposing that last night
in a special session called just for this purpose -- get this -- the
Republican-controlled state Senate in Arizona gave the governor the vote
she need to fire the head of this supposedly independent commission.

(BEGI VIDEO CLIP)

ELIZABETH BERNSTEIN: It`s a betrayal of the process that the voters
wanted to see in place, because it`s just bringing back very, very heavy
political influence by the same legislature that we tried to take out of
the process.

REPORTER: The Republican majority in the Senate has voted
unanimously to oust the chairwoman of the redistricting commission. She`s
Colleen Mathis, for the governor says is creating a cloud of suspicion over
the commission`s work. Republicans don`t like the way the new maps were
drawn, even though the maps do give them an advantage.

(END VIDEO CLIP)

MADDOW: Republicans get an app advantage from the new maps but
probably that advantage is not enough of an advantage for the Republicans
in Arizona. Governor Brewer is not actually even in Arizona while this is
happening. She`s reportedly in New York this week promoting her book.

This is the back cover of her book. Yes, that`s real. That`s
supposed to be Jan Brewer.

But even while on the road trying to live up to that lovely
caricature, Governor Brewer took time away from her book tour to un-
independent the independent commission voters in Arizona specifically
created to take this kind of out of the hands of politicians like her, out
of the hands of partisan politics altogether.

Senate Democrats are calling the firing a witch hunt and disgrace.

In 2000, when Arizona was debating whether or not to pass Prop 106 in
the first place, deciding whether or not to take this district drawing
power away from the legislature, the people who supported the measure were
groups like the League of Women Voters and the Arizona School Board
Association. People against it were Republican legislators.

The voters and the independent good government groups won that fight
to make this thing independent. They won the vote. They got that
independent commission.

And now, Republicans have found a way to use their majority to kill
it anyway.

Joining us now is Arizona Congressman Raul Grijalva, who is a
Democrat, who represents Arizona`s seventh district.

Congressman Grijalva, thank you very much for your time tonight.

REP. RAUL GRIJALVA (D), ARIZONA: Thank you very much. Appreciate
it.

MADDOW: I know that neither Democrats nor Republicans are huge fans
of Arizona`s new proposed map from this redistricting commission. But
isn`t that what you`d expect from an independent panel working on this?
Isn`t that what you would hope for?

GRIJALVA: The voters approved this independent commission. It has
not been a smooth process. It is for those of us that are in office. It`s
been long and strenuous.

But the fact of the matter is, it was created so no majority in the
legislature could feather their own nest. And while, you know, there`s not
100 percent satisfaction, at least on my behalf, what is true is what the
governor did and the state Senate did was I think is potentially illegal,
unconstitutional, and they did it in the middle with no time, no due
process for the chair of the commission to be able to respond.

And more importantly, it`s a kangaroo court. This was all
predetermined. This is to protect the four incumbent Republicans that are
in Congress right now to make sure that they have a district that secures
them.

And I really believe that what has been done here adds another very
ugly and painful episode to the legacy that Jan Brewer and this legislature
have provided to the nation about Arizona. That`s not the people of
Arizona, but certainly our political leadership in the state continues to
try to muscle, heavy handed way of trying to direct politics and create a
culture for the next 10 years that they will be able to control.

This is going to be fought by people in Arizona because this is not
what they voted for, one. Two, the fact that it has been done the way it`s
been done, raw political power, heavy handed, and apparently violating the
very tenets of the Constitution that created this commission. This story
is not over yet.

MADDOW: Arizona has done smart things in terms of removing partisan
advantage from either side from the political process. Some far sided
political reforms like public financing for elections in Arizona which, of
course, was struck down by the conservatives on the Roberts Supreme Court.
An independent commission, this one outside partisan politics to each
district, to stop gerrymandering, now seemingly blown up by the Republicans
in the legislature.

There seems to be a real difference here between what the voters of
Arizona are saying that they want and what they are getting from the
political process.

GRIJALVA: Yes, regardless of the philosophical differences that
exist in Arizona, and they do, this is a very populist state. This is a
very independent-minded voter.

And everything that has been done around public financing, the
independent commission and other reforms to enhance the ability for this
democracy of ours to work, the Republican majority in the legislature and
now the governor have gone out of their way to begin to undo what has been
practices and referendums passed by the people that have worked for Arizona
and has leveled the playing field and provided opportunities for the voters
of Arizona to elect people that represent their point of view.

They`re risking -- I just think they`re risking not only the
reputation of Arizona, but the very democracy that the people of Arizona
want.

MADDOW: Congressman Raul Grijalva of Arizona -- it`s always a
pleasure to have you on the show, sir. Thank you so much for your time
tonight.

GRIJALVA: Thank you, Rachel. My pleasure.

MADDOW: Apparently, Herman Cain, Republican presidential candidate,
was not aware that China already has nuclear weapons. Missed the last 40
years or so. Very busy blaming other Republican candidates for his sexual
harassment allegations, apparently. Lawrence will be breaking that down on
"THE LAST WORD" tonight.

We will be right back.

(COMMERCIAL BREAK)

MADDOW: In the fall of 2008, the Minerals Management Service became
the most famous agency within our nation`s very infamous Interior
Department. Yay, Minerals Management Service.

But they did not become famous in the good kind of famous. It was
the kind of famous you get for earning headlines like this. Sex, drug use
and graft cited in Interior Department report. An inspector general`s
report found, quote, "A culture of ethical failure. More specifically, a
number of officials at the Minerals Management Service, quote, "frequently
consumed alcohol at industry functions, had used cocaine and marijuana, and
had sexual relationships with oil and gas company representatives."

In addition to getting to shtooping and getting high with the oil
company people they were supposed to be overseeing, the Bush
administration`s Minerals Management Service also had its employees
shtooping each other and doing drugs with each other, too, leading even
relatively staid newspapers like the "Houston Chronicle" to lead stories
this way. Quote, "A program director allegedly snorts crystal meth off a
toaster oven." Snorting meth off a toaster oven.

In the Bush administration, this was your Minerals Management Service
at work.

Employees whose job it was to regulate the oil and gas industry also
took gifts from that industry, including staying overnight at an oil
company-owned resort lodge, after getting too hammered with oil and gas
company employees to be allowed to drive themselves home.

The oil and gas industry still produces its share of scandals, but
since the Bush administration, the scandals are a little less sexy. I
mean, in the literal sense that they`re less about shtooping.

For example, House Republicans have convened hearings, including one
today, to investigate federal loans given to a company called Solyndra,
which then went bankrupt, attacking that specific loan but also attacking
the whole idea of government giving loans to companies at all. The
awkwardness in that argument for the Republicans is that the company was
cleared to participate in this loan guarantee program by the George W. Bush
administration and the legislation creating the loan guarantee program was
approved by the Republican-controlled Congress in 2005.

That legislation creating the Solyndra loan program was approved, in
fact, by every single Republicans who`s on the subcommittee now holding
hearings to investigate it, now saying they are outraged by it. The only
Republicans on this outraged committee who didn`t themselves vote for the
Solyndra program were the four Republicans on that committee who were not
yet in Congress when the vote was taken.

Don`t be distractive, though. The conservative group funded by the
oil and chemical fortune heirs, billionaire brothers, the Koch brothers,
Charles and David Koch, their group, Americans for Prosperity, announced
today that they`ll be spending $2.4 million big ones, $2.4 million buying
airtime for this new ad demanding real answers to what they call a green
energy scam. Tomorrow, a House committee is expected to issue subpoenas to
the White House for more documents related to the loan guarantees.

So, that`s the unsexy energy scandal on the right. Meanwhile, on the
left, there`s plenty of -- I think, still safe to say, unsexy consternation
over the State Department`s still pending approval of a massive tar sands
pipeline across the continent, north to south.

E-mails last month show a cozy relationship between staffers at
Hillary Clinton`s State Department and lobbyist for the pipeline who used
to be the deputy national campaign director in Hillary Clinton`s `08
campaign for president.

But whether or not this Keystone pipeline gets built will not
actually be up to Secretary Clinton and the State Department as the
president made clear yesterday. The State Department gets to make a
recommendation but the decision will be the presidents.

(BEGIN VIDEO CLIP)

OBAMA: The State Department is in charge of analyzing this because
there is a pipeline coming in from Canada. They`ll be giving me a report
over the next several months. And, you know, my general attitude is what
is best for the American people I`ll be measuring these recommendations
when they come to me.

(END VIDEO CLIP)

MADDOW: Environmental groups will be protesting against the White
House next week. There have already been a lot of protests and a lot of
arrests, people trying to stop this pipeline. The new pipeline as you may
know would cut right through the Ogallala aquifer. That`s the aquifer that
is the source of the groundwater for a third of the farms in this country.

So, it`s not just tree-hugging environmentalists who are anxious and
angry about this proposed pipeline. It`s farmers, too.

But if you think the Solyndra and pipeline scandals lack a certain
sexiness compared to the Bush administration`s snorting meth off the
toaster oven, shtooping the lobbyist in the hot tub kind of scandal, there
is probably no hope for a full scale national fit of consternation over my
personal favorite energy scandal, unless we can figure out how to get sex
or drugs into this one somehow.

The East Coast earthquake hit on August 23rd this year, right? The
damage to roads and homes and offices was not catastrophic except in some
very specific locations. However, the epicenter was 12 miles away from the
North Anna nuclear plant in Louisa County, Virginia.

And because of the earthquake, the plant had to shut down. That is
the first time that`s ever happened to any nuclear plant in the country.
They`ve never before had to shut one down before a quake.

Well, 10 weeks after that August earthquake, the North Anna nuclear
plant is still not back up and running. When that plant shut down, we were
first told it was shut down because knocked off the electrical grid when
power went out in the area due to the quake. It turns out that was not
true. We since learned that the North Anna plant shut down because of all
the shaking from the earthquake and it was only after the plant shut down
because of all the shaking that the electrical power went off.

And eight seconds after the electrical power went off, the generators
kicked in, three diesel generators kicked in. One of the four generators
at the North Anna plant tried to kick in and failed.

Right now, the rule for American nuclear power plants is that they
have to have backup generator capabilities for four hours before off site
power is restored.

Here`s my question. What if it takes more than four hours to get the
power back on? Remember, if can you not keep the power on, if your diesel
generators are not running to keep the cooling system going, if you can`t
keep the cooling system on, Fukushima.

I know there is no sex scandal or partisan advantage here. But for
the record, today, we learned that -- OK, the headline in the "Associate
Press" calls it a glitch. But check this out -- utility officials say gas
from inside the Fukushima plant`s number two reactor indicated the presence
of radioactive xenon which could be the byproduct of unexpected nuclear
fission. This is happening now, today, at Fukushima, unexpected nuclear
fission.

Nuclear fission as in the very thing emergency crews were trying to
prevent in the meltdown at Fukushima because a small burst of fission could
trigger a much larger nuclear reaction. That`s still going on.

Here in the United States in just the last couple months, in addition
to the earthquake-damaged North Anna plant which is still not online, the
Palisades Nuclear Plant in southwestern Michigan was shut down for a week
because a mechanical fault led to a small release of radioactive tritium
into the air. This is the same plant shut down in September because it
lost water in its cooling system. At a plant in Georgia, in Baxley,
Georgia, they found radioactive water, tritium again, leaking out of the
plant.

The Seabrook Station nuclear station in New Hampshire shut down
automatically after a faulty water pump caused a low water level in its
steam generator. After three weeks of being online, it is just now being
turned on again.

At a plant in Ohio, more cracks were found this week in the concrete
shield building that`s supposed to protect the reactor from wind and
tornadoes. The plant`s been shut down since October 1st because of
previously discovered cracks. Those cracks were found accidentally when
the plant`s owners were doing some unrelated renovations.

And yesterday, a nonradioactive ammonia leak at the San Onofre
nuclear plant in California set off alarms and caused a partial evacuation
of the plant.

On top of all that, General Electric Corporation -- hi, boss -- says
that the 35 nuclear reactors that it built over the last 40 years from New
York all the way down to Washington may not shut down properly during an
earthquake. The company is recommending testing now to determine how much
of a jolt it would take to stop the nuclear fission process during an
earthquake in one of those plants. They`re recommending additional
testing, 40 years after making them, because we don`t know the answer to
that yet.

Some of these plants are 40 years old. These plants are all 40 years
old. And we`re just now getting around to figuring out how big a quake
would turn them from a disaster into a catastrophe.

All of our nuclear plants being decades old and constantly subject to
poorly understood and unprecedented mechanical failure is not the kind of
scandal that involves sexy things like reality show stars getting divorced
after 72 days of matrimony, or regulators shtooping lobbyists or drugs be
snorted out of household appliances in the name of the American taxpayer.
But some day this stuff, this nuclear plant stuff is going to drive me nuts
enough that I`m going to send cocaine-laden divorce papers without a pre-
nup up to Indian point in the hopes of getting somebody outraged.

(COMMERCIAL BREAK)

MADDOW: Thousands of people are on the streets of Oakland,
California, tonight participating in a general strike, which is a rare bird
in American history. General strike is not a strike against a specific
business, but a strike for greater cause, a strike to show solidarity -- in
this case to say we all stand for an economy and a political system that
does not only benefit the richest among us. The strike today in Oakland
has culminated in a March to Oakland`s port. Entrances are blocked.

The port tonight saying the protests have, quote, "effectively shut
down maritime operations there." Police are describing the crowd as
peaceful. They say that no arrests have been made.

The filmmaker Michael Moore who was at "Occupy Oakland" over the
weekend is going to be joining us here on THE RACHEL MADDOW SHOW tomorrow
night for the interview.

And then on Friday, I`m very happy to say, we`re going to be joined
by Daniel Handler, who you may know as Lemony Snicket. He is among the
writers who are supporting on "Occupy Wall Street." He`s written a
brilliant piece on the movement for the OccupyWriters.com.

Michael Moore, Lemony Snicket, all ahead. We hope you`ll join us for
both of those shows.

But "THE LAST WORD" with Lawrence O`Donnell starts right now.

Thanks for being with us.

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

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