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'Up w/Chris Hayes' for Sunday, July 22, 2012

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Guests: Stacy-Marie Ishmael, Amy Goodman, Josh Barro, Bryn Bird, Gary Gensler, Akil Hashem, Sarab Al-Jijakli

CHRIS HAYES, HOST: Good morning from New York. I`m Chris Hayes.

President Obama is going to Aurora, Colorado, today to visit with the
victims of Friday`s theater shootings, their families and local officials.
And after suspending their campaigns, both President Obama and Mitt Romney
will return to the trail on Monday with stops across the West Coast.

But I want to start with my story of the week: the taxes of the
father. By week`s end, it was getting harder and harder to find anyone
Democratic, Republican, pundit, politician, or operative who didn`t think
Mitt Romney should and ultimately would have to release more than just two
years of his tax returns. Especially tough for Romney to change the
conversation from his taxes when Senate Democrats are planning to introduce
legislation this week raising taxes on dividends and capital gains to 20
percent and are now talking about letting all the Bush tax cuts expire as
part of a strategy to limit actual tax increases to people with annual
incomes above $250,000, people like, well, Mitt Romney.

And it also doesn`t help that when George Romney ran for president in
1968, he set a new precedent by turning over 12 years of tax returns to
"Look" magazine. George W. Bush release nine years. In 2008, Barack Obama
released seven years. And John McCain, who also wasn`t thrilled about
seeing what a wealthy person`s tax returns look like, released only two, as
well.

Despite the urging the Senator Chuck Grassley, Governor Rick Perry,
Senator Dick Lugar, Governor Haley Barbour, Michael Steele, Representative
Ron Paul, Brit Hume and George Will to release more of his tax returns,
Mitt Romney has insisted what we have now is all we`re going to get -- or
as Ann Romney infamously put it.

(BEGIN VIDEO CLIP)

ANN ROMNEY, MITT ROMNEY`S WIFE: We`ve given all you people need to
know and understand about our financial situation and about how we live our
life.

(END VIDEO CLIP)

HAYES: It`s hard enough to focus here on the obvious contrast
between the father and the son, George Romney`s forthright transparency
that was for the time groundbreaking, first, the dodgy stonewalling from
his son. The Obama campaign, understandably, delights in drawing those
contrasts as indictment of the character of Mitt Romney. What are we meant
to ask, is he hiding. What could possibly be so damaging in those hidden
returns that Mitt Romney is willing to pay the political price of
continuing to stonewall?

But what`s most fascinating about this episode to me isn`t what we
don`t know about Mitt Romney`s tax returns but instead what we do know
about George Romney`s. After George Romney handed over his tax returns to
"Look" magazine, they published a summary in this chart, and sitting here
in 2012 in the midst of our own tax debates, you can`t help but look over
the details and think, holy crap that dude paid a lot of taxes.

Over the 12 years, George Romney had an adjusted gross income of just
over -- just under $250,000, which is nearly $2 million in today`s money
and paid an annual average effective rate of 37 percent -- 37 percent.
Compare that to what Mitt Romney paid, according to his two returns, an
average effective rate of 15 percent. That`s a very big difference. How
would you like to have your federal income taxes dropped 22 percentage
points?

What`s remarkable is that even though Mitt Romney with an average
annual income over the past two years of over $22 million is 11.5 times
richer than his dad was, adjusted for inflation, they are both in the top
0.01 percent of their respective times.

Think of what that means about the growth of incomes at the top over
the intervening years. And despite how much richer Mitt Romney is than his
father, he pays less than as much of his income in taxes.

The reason that George Romney paid so much more in taxes isn`t
because George Romney was a saint and his son is a lout, it`s because
George Romney happened to be a rich man during a period in which this
country was committed to robust, progressive taxation.

The top marginal rate during most of the years Romney, Sr. was filing
was 91 percent -- 91 percent. Now, it so happens that George Romney
declared a lot of his income, not his wages, but his capital gains, but the
capital gains rate was 25 percent for George Romney, while it`s only 15
percent for Mitt Romney.

If there`s a single trend in American political economy, it isn`t
it`s rising inequality and that rising inequality hasn`t been mitigated by
the tax system, it`s been exacerbated over time. As you can see, top
marginal rates go like this. Capital gains rates go like this -- like
water, the rate flow down. This doesn`t even count the proliferation of
new strategies to hide income from the IRS and foreign tax shelters and the
like.

The ultimately irony is that while the president`s campaign points to
George Romney as a model of personal virtue, virtually no one in Washington
is advocating returning to the tax policies of that era, an era, I`ll add,
that did not want for growth.

The Obama campaign is suggesting we left the top marginal rate for
those making above a quarter of a million dollars rise to 39.6 percent and
raise the top capital gains rate to 28.3 percent, both below what George
Romney paid. And when Mitt Romney says this --

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: I want to restore to
America the principals that made us the hope of the Earth.

(END VIDEO CLIP)

HAYES: He`s not talking about the principle of progressive tax
rates, one of brave, new world of low taxes, one that has been preserved
under Barack Obama and Mitt Romney has no interest in going back.

This is the real reason I think that Mitt Romney doesn`t want to do
what his father did by releasing more returns. His father`s taxes are a
picture of progressive taxation, of a society where the wealthy are bound
to everyone else.

His own taxes, from what we`ve seen, are a snapshot of what our tax
regime looks like under conditions of encroaching oligarchy, in which the
wealthy have used their influence over the political parties and the
policy-making apparatus to write rules that allow them to keep the
government`s hands off their cash. A world in which they`ve created a
rapidly growing industry of tax lawyers and accountants who make lots of
money determinatively boring through the tax code like termites.

This isn`t about what kind of man George Romney was and what kind of
man Mitt Romney is. It`s not a character story. Elites are subject to the
norms of their time.

This is about the relationship of our elites to the rest of their
fellow citizens and the ways it has changed over the last half century.
It`s about what a society looks like when it`s incapable of forcing the
most powerful members to play by the same set of rules as everyone else.
It`s not a pretty picture. And Mitt Romney is right to be embarrassed. We
should all be.

Joining us to discuss the imperative of raising taxes on the rich by
a whole lot is: Stacy-Marie Ishmael.

STACY-MARIE ISHMAEL, CUNY: Hi.

HAYES: -- adjunct professor at CUNY Graduate School of Journalism,
where she teaches about Wall Street.

Josh Barro returning to the table, columnist at "Bloomberg View."

Retired Army Colonel Jack Jacobs, also returning to the table, author
of "Basic: Surviving Boot Camp and Basic Training," Medal of Honor
recipient, and MSNBC military analyst. He`s also held positions at several
investment funds since his retirement.

And Amy Goodman, host of "Democracy Now!," also returning.

It`s great to have you all here.

AMY GOODMAN, DEMOCRACY NOW!: Thank you.

HAYES: So, I`m a total cliche on this, which is that I think we
should tax the rich a lot. And it is so striking to go back into that and
look at that what that tax regime looked like because it is -- it`s like
from another planet. I mean, our tax conversation just has no relationship
whatsoever to that period and that period of time is an era of great
nostalgia for a lot of people in a lot of different ways. And yet to look
at, you know, just how much he was paying.

I want to -- I want to read this little bit from "Fortune" magazine
which talks about how transformative this kind of progressive taxation was
for just the lived reality of executives of the time, of folks who made a
lot of money. This is "Fortune" in 1955 talking about how top executives
live.

And the whole story is about sort of how modest their lives are. "If
he is a top executive, he lives on an economic scale not too different from
that of the man on the next lower income rung. He surrenders around 40
percent of his salary to the Bureau of Internal Revenue. He may cough up
as much as 75 percent. He owns two cars and gets along with one or two
servants.

Twenty-five years have altered the executive way of life noticeably.
In 1930, the average businessman had been buffeted by the economic storms,
but he had not been battered by the income tax."

So, I want to go back to that world.

Josh Barro, why shouldn`t we?

JOSH BARRO, COLUMNIST, BLOOMBERG VIEW: Well, I think the economic
growth that we saw in the 1950s and 1960s that people like to say, well,
you know, look, here, we can do this with this income tax, you had a very
specific economic reality at the time where basically Europe had destroyed
itself after World War II, and we were able to sell them a new version of
everything they had broken.

And so, there were a lot of -- there were a lot of low-hanging
economic fruit to be divided up among people. That was also a period of
extremely strong union strength. But, again, partly just a lot of surplus
for workers to divide up with the companies that they own and the economic
reality is different now.

You also have different tax codes in countries around the world. I
mean, you had similar top rates in Europe which you don`t have any more.
France may go back to that after the most recent election, but you`ve seen
the same pattern in taxation policy throughout the first world. And so, we
would be very different from everybody else if we went back to this.

HAYES: Well, that`s not necessarily true. I mean, there are places
-- Denmark has a top marginal rate of 78 percent.

BARRO: But not on capital income generally.

HAYES: Of course, right. So, there`s two things, right? There`s on
wages and then there`s on capital gain. I want to raise them all. Just
raise them all. Raise them all.

But, no, I mean, I think that the other point, though, is that the
decline in top rates that we`ve seen around the world isn`t necessarily --
I mean, it`s two things. Not necessarily that people came to a policy
conclusion that that`s superior, it`s that there`s been a rise of
inequality and there`s a rise of power of the folks with a lot of money
across a lot of the world who, obviously, don`t want to see their taxes
raised.

ISHMAEL: Well, those things are directly correlated, right, because,
you know, the altruism is that you have to have money to make money.

HAYES: And if you`re in a situation where your family has always
been paying relatively lower taxes on capital gains, it sets up a system
where if all you have is income and you`re always paying a much higher tax
rate than people who already have more substantial wealth, there`s no way
for you to ascend to wealth. You might be rich, but never wealthy in the
same way because of the way the tax systems have been built over time.

HAYES: We see in polling, which I think is remarkable is that, you
know, if you ask people about how we should solve our deficit, the most
popular solution is always tax the rich. And something like 81 percent
like the idea of some kind of surcharge tax on incomes over $1 million and,
yet, that`s not going to happen politically, right, Amy?

GOODMAN: I don`t think we know what`s going to happen politically.
And I think these magic moments, you never know when they will come. But
if you`re involved with working for social change, if you`re building a
foundation, you never know what will happen.

I mean, whoever knew that the Occupy Movement would burst on to the
scene the way that it did. So, I don`t make predictions like that. But
it`s very interesting to look at the movements that push for these kinds of
issues.

COL. JACK JACOBS, RET., MSNBC MILITARY ANALYST: Well, if you want
change, the change you`re talking about can be executed only in the
Congress. So, you`re quite right that you`re not going to see change like
that because money drives congressional elections and people who are
writing checks to elect congressman and senators are not going to vote. So
--

HAYES: Well, that`s -- I mean, you have put your finger on precisely
the issue, right? I mean --

JACOBS: So, if you want to fix it, if you want to fix it, the thing
to do is not to rail against -- not to rail against the fact that we`ve got
an inequitable tax --

HAYES: I like railing.

JACOBS: I mean, you`re in charge, so, I think turn up your
microphone louder so everybody -- but, seriously, to make sure that we get
election reform.

HAYES: Right.

BARRO: I would be very careful about the sort of polling data on
what`s popular on the budget because the public doesn`t think about the
federal budget in a coherent way.

HAYES: Clearly, yes.

BARRO: Like you ask people about what tax rates should be. People
react negatively to high figures on marginal tax rates for high incomes I
think because they don`t know what top tax rates are, that people -- the
idea of, you know, a 70 percent or 91 percent top rate would not be popular
if you polled it.

I think, also, the left undermines itself in this tax debate because
the only -- the arguments for higher taxes that you hear are exactly like
the ones you`re making about fairness. They don`t talk about the actual
need to finance government. And, in fact, you have Barack Obama out there
insisting that 98 percent of Americans shouldn`t have to pay any more in
taxes.

So, I think if liberals can`t make the argument that tax increases
are necessary, Republicans can always come up with arguments for why you
shouldn`t do a specific tax.

HAYES: So, my arguments -- just to be clear -- I think there`s a few
arguments. One, you have to finance government and there`s a lot of money
at the top. So, that`s one place to look. It wouldn`t solve the deficit.

We`re talking about the difference between the plan -- the Republican
plan and the Democratic plan right now between extending the Bush taxes for
everyone below $250,000 and ending the top. That`s $28 billion in revenue.
That`s not an insignificant amount. I mean, that`s real money.

But my argument actually isn`t the argument that Barack Obama or
anyone else is making, it`s that actually taxing the top and reduces
inequality and the reduction of inequality actually --

ISHMAEL: Stimulates economic growth?

HAYES: Well, no, yes, but I think it`s just better for the society.
I think you actually have a stronger, social fabric. I like the world in
which the top executives get by with only one or two servants. More on
that, after we take this break.

(COMMERCIAL BREAK)

HAYES: Talking about progressive taxation, one of my favorite
topics, and top marginal tax rates, another one of my favorite topics. And
the fact, I mean, the fact is we`ve just seen part of my concern, really,
about this tax debate and the reason I think it`s so important and I think
this comparison between George Romney and Mitt Romney, it partly gets to
what you`re saying about, Jack, about just whether the political system has
the capacity to do this thing.

JACOBS: Yes, it doesn`t. I mean --

HAYES: It doesn`t appear to. But I think that`s a profound
statement about the political system if -- forget all of these arguments.
I mean, just as like a test of the capability of the legislative process to
raise marginal rates, which we haven`t done since Clinton, right? It`s
been since, I guess, `93 that budget.

BARRO: Well, no, there`s a marginal rate increase in the health care
law.

HAYES: Yes, that`s true. And there`s such a marginal and there`s a
capital gains tax increase in the health care law of 2.81 percent.

So, this question of whether we can do this, I think, is still
remains as really core question. Whether the justifications are that we
need to raise revenue for the government or this fairness argument, to me,
it ends up being a test of how strong our democratic system is.

BARRO: But I think it really is the failure of the left to make the
positive case for government, because you basically made the case for
higher taxes that suggest that even if we, you know, gathered up all the
money and burned it, it would still be a good thing because it would
increase equality.

HAYES: I believe it, yes.

BARRO: You believe that, but you`re not going to sell that to the
public. If you want to sell tax increases, you have to do what was done in
Europe where you convince people that the government is worth paying for
and it`s worth everybody paying for. And you can have a progressive system
where people at the top pay more.

But when you have both political parties not making the case that
government did something not worth paying for, and the only argument you
have for taxing that rich is that we want the rich to have less money,
that`s not going to be a winning argument.

JAOCBS: It`s not for nothing that the Congress is held in the lowest
esteem of any institution in the United States. The public may not be the
most educated bunch of people in the world, but they`re not stupid and they
recognize that the utility of Congress doing what it has been doing and
doing what it`s doing, and doing what it`s going to do is very, very low
indeed.

ISHMAEL: But your point about education and your point about
messaging, we -- this argument has been framed really badly. Taxes get all
lumped into, there`s no distinction made between income tax and capital
gains tax. There`s no explanation that it`s only money that you make above
$250,000. You know, all of these nuances that they never pay anyway.

So, when people are like, I`m against higher taxations, that`s a
meaningless statement. There`s no nuance in the discussion.

HAYES: Right. And you make a great point, which is that people
don`t actually understand, some of them understandably don`t understand the
basic concept of marginal tax rate, which is that if your -- the tax cut
proposal by the president cuts taxes for everyone because everyone who
makes above $250,000 pays the lower rate on the money up to $250,000,
right?

I mean, I think people don`t get that like you pay in these sort of
chunks. That`s the way that marginal rates work. So, the idea that he`s
raising taxes on the rich, it`s actually a tax cut for everyone. It`s the
question of how big a tax cut.

Here`s the relative proposals -- I think this says a lot, because I
think one of the things, this is -- this is Mitt Romney`s tax proposals and
Barack Obama`s tax proposals. So, the change in effective rates is, you
know, essentially unchanged for everyone except those at the top under
Barack Obama. And under Mitt Romney, there`s a big cut for everyone in the
60 percentile and above, and a huge, huge cut for the top 1 percent.

This has been the one thing the Republican Party has reliably
promised and delivered on over time. They haven`t shrunk government. They
haven`t managed to outlaw abortion at the federal level. The one thing
that you can be sure Republicans will do when in office is cut taxes at the
top. That is the one thing that they can reliably be counted on to do.

ISHMAEL: Absolutely.

HAYES: Do you agree?

BARRO: Well, they cut taxes for everyone, which was the more
irresponsible part of it was that --

HAYES: Right. But, distributionally it was skewed towards the top.

BARRO: Not on the income tax, but on the overall tax system, because
if you shrink the income tax.

HAYES: Yes.

BARRO: But, yes, no, I think that`s the Republican messaging problem
and the Republican policy problem over the last 20 years has been this --
the breaking of the link between taxes and spending where Republicans
disserved the right by convincing people that all you needed to worry about
was the tax side.

HAYES: Right. That`s -- this makes a point, right? On the right,
there`s been a delinking of taxes and spending. And on the left, reputedly
left, on the Democratic Party, there`s this argument of we`re tax cutters,
tax cutters just not for everyone, right? It`s a competition of who is
cutting taxes the most?

BARRO: So, why aren`t you outrage about this?

HAYES: I am.

BARRO: Why aren`t all of you outraged at your president that you
guys worked so hard --

(CROSSTALK)

HAYES: Did you watch this -- did you watch this network and read
"The Nation" after they cut the deal that extended the Bush tax cuts during
the lame duck? We all went bonkers?

BARRO: No, but you were angry about was the 20 percent of the Bush
tax cuts that accrue only to the wealthy. I`m asking, why you`re not
outraged that the president is saying that we can keep 80 percent of the
Bush tax cut package?

HAYES: I am outraged about. Not outrage, I disagree with him. But
part of that also is that there`s a cyclical element to this as well. I
mean, it`s true that a broad-based tax increase right now which we`d take
money out of people`s pockets is a form of austerity, right?

BARRO: Right.

HAYES: So, it`s just -- from the perspective of how we`re managing
the economy at the current moment, it doesn`t make sense to have a broad-
based tax increase across most of the population, even though I totally
agree that Democrats have to make an affirmative case for higher taxes in
the future because we need to fund the government because the government
all does things that we all believe in and that we like.

I`m going to let you respond after this.

(COMMERCIAL BREAK)

HAYES: There`s two elements of tax fairness, right? There`s the
rates that get paid at the top, of course, the bottom, and how progressive
the system is. But then the other element that we`re seeing -- and, Jack,
you`re talking about this, you know, that we`re seeing in the Mitt Romney
tax returns is that the system, just the rules and the ways that people
with lots of assets go about paying their taxes. Forget what the rates
are, is just in a different universe than the most people who are just
filing on wages and can`t have incorporated entities in the Cayman Islands.

JACOBS: Well, they can but there`s no purpose to it because they
don`t have the kind of assets that would benefit from that kind of
treatment. But the culprit here is not the guy who uses them, the culprit
here is the tax code.

If you want to make it easier to tax people on the basis of ordinary
income, then write a tax code that`s like that. But we don`t have a tax
code like that.

HAYES: But we don`t have a tax code, so, an interesting debate here
when we talked about the tax code`s complexity and the ways that wealthy
people can hide their money from the government, there`s the argument that
it`s the code itself, right? So, when people talk about tax reform, they
talk about how we`re going to simplify, et cetera.

And then there`s what I think is the case is that, it`s just -- the
tax code itself is a symptom of the concentration of power among people
with a lot money. But you can simplify the tax code and then if you keep
the same levels of inequality, it`s just going to get rigged, again, right?
That`s really the source of the issue here.

JACOBS: I think -- I don`t think it necessarily would get rigged,
again. If you treat absolutely everything as ordinary income and then say,
even if it`s --

HAYES: You`re saying, everything, capital gains, everything is the
same.

JACOBS: Money comes from some place into your pocket or something
that you control.

HAYES: This is a radical proposal, I would note for those watching.

JACOBS: It`s a very Republican proposal, too, by the way.

HAYES: It`s not actually. It confounds standard, standard
ideological --

JACOBS: But there are plenty of studies that indicate you probably
wind up making lots more money for the government and I`m not sure that is
a good idea, quite frankly, because you have to be bought into the concept
that the government knows how to spend money properly which it clearly does
not.

How much does you make, multiply it by this amount and send it in.
And the people who would be violently opposed to that are certified public
accountants and tax attorneys, and so on.

UNIDENTIFIED FEMALE: Right.

JACOBS: The fact of the matter is --

HAYES: Well, the other people opposed to that, anyone who is going
to pay more, particularly those at the top. We`ve seen at --

(CROSSTALK)

ISHMAEL: -- capital gains.

HAYES: Anyone with a lot of income from capital gains --

JACOBS: There are plenty of studies which indicate they wouldn`t
necessarily pay any more. A guy like Romney who -- what does he pay in
percentage?

HAYES: Fifteen percent.

JACOBS: He might pay 15 percent, again. He might pay 12 percent.

BARRO: Somebody has to pay more, though, if you want to raise the
same amount of money.

JACOBS: I`m not paying any more.

GOODMAN: This is the general`s general proposal.

ISHMAEL: If we`re going to for the argument that corporations are
people, too, then you say corporations and people are taxed in the same
rates, if we`re going for radical tax reform.

JACOBS: What you`re suggesting is what the Supreme Court suggested
and that is that corporations are people.

ISHMAEL: Yes.

JACOBS: And therefore should be treated as people. That`s radical,
too.

BARRO: There are ways you can change the tax code to avoid this. I
mean, you can also have what`s called a progressive consumption tax. The
problem with taxing income is that when you have Capitol Hill gains, there
are lot of ways to avoid realizing income and any tax systems that involves
taxing returns to capital will create structures that people use to avoid
realizing taxable returns to capital. But it`s a lot harder to hide your
consumption.

The problem with that is that wealthy people have a lot of income
that they don`t consume in a given year. So, in order to have
progressivity with that, you would need quite high rates at the top that I
think people might find a little bit eye watering. The challenging thing
is --

(CROSSTALK)

HAYES: -- UP with Chris.

BARRO: Right. Well, you know, what you would find eye watering is
the fact that if you earned income and didn`t consume it, you wouldn`t have
to pay tax on it.

HAYES: Pay anything on it, right.

BARRO: So, you can frame this two ways. You can say, you know, the
left gets its progressivity and the right gets its favorable treatment for
capital and investment. Or you can say that the right would hate the high
marginal rates and the left will hate the fact that capital income goes
untaxed.

HAYES: Right. But the interesting thing here is that when we talk -
- and this is something that people talk about tax reform, right? We`re
going to simplify. We`re going to have a big round of bipartisan tax
reform and we`re going to, you know -- yes, you`re laughing, I think, as I
do, too, because the fundamental -- not to sound like a broken record, but
the fundamental record is a political problem, right?

Because that same Congress that you`ve been talking about that`s
going to write those rules, it`s the same Congress that represents the same
interest. The same Congress at can`t get rid of the carried interest
loophole which allows hedge fund managers who are basically paying their
own wages in capital gains so they can make 15 percent on it have been
unable to close that loophole, that small little part of the tax code that
doesn`t really make any difference in terms of the deficit, about
government ledger.

But that`s just a small principle. Everyone understands that that`s
untenable. Even Warren Buffett I think has said this and Rupert Murdoch
has tweeted about how ridiculous it is. And they can`t close out
loopholes. That same institution seems to be incapable of creating a tax
code that is going to be --

(CROSSTALK)

JACOBS: The guys who are really, really opposed to tax reform are
not the guys who are super -- who are the super rich. Let`s face it, if
you`ve got $10 billion and the day after you pay your taxes you`ve only got
$7 billion, you still have $7 billion.

HAYES: I`m not sure that`s true.

JACOBS: The guys who really get -- well, the guys who really are
violently opposed to the kind of reform, which will take more money out of
people`s pockets and give it to the government are the people below the
level of super rich and above the level of people who have --

HAYES: Upper middle class, right.

JACOBS: Upper middle class. The fact of the matter is the large
majority -- you can correct me if I`m wrong about this -- the large
majority of new jobs that are created are not created by George Romney`s
General Motors or Motors Corporation. It`s created by smaller and medium-
size businesses and those are precisely the people in that --

HAYES: Well, you point to something about our tax code that`s
perverse and I think creates the politics of this a little bit, which is
James Surowiecki wrote in the "New Yorker," LeBron James and LeBron James`
dentist, they are the same from the perspective of marginal rates, right?
And that`s where the LeBron James` dentist is the one who`s really ticked
off about the taxes because LeBron James is going to find ways to not pay
his taxes. LeBron James` dentist has a harder doing that.

How a warming planet is related to soaring food prices, coming up
next.

(COMMERCIAL BREAK)

HAYES: As we said before on this show, we`re entering a new era, an
era of hotter, stranger, more extreme weather that is going to impact every
last aspect of our lives.

Trying to understand the overall effect of climate change on
something as basic as our food supply and prices at the grocery store can
be difficult. But right now, the connection is looking pretty clear.
We`re in the midst of the worst drought in more than 50 years, covering 64
percent of the area of the continuous 48 states, the sustained record-
breaking heat and dry weather has caused corn and soybean crops to
deteriorate.

For the past two months, the price of a bushel of corn has risen more
than 50 percent, setting an all-time high of $8.28 a bushel on Friday. On
the same day, soybean prices reached a record high of $17.07 a bushel.

It`s true that to some extent, rising food prices are part of a
general boom in commodities. It`s a second month in a row that the global
land temperature was the warmest on record for that month. We`re looking
at our own future, a new normal that is going to radically alter farming,
impact global commodity markets and food prices from Cairo, Illinois, to
Cairo, Egypt.

As we saw just a few years ago when spiking food prices helped fuel
the Arab Spring uprising, a world of food volatility is a world of
political volatility.

Joining us at the table now to discuss the future and present of our
food system in the warming planet is Bryn Bird, a second generation farmer
from Ohio.

Bryn, it`s great to have you here.

BRYN BIRD, SECOND GENERATION FARMER: Thank you so much.

HAYES: Tell me a little bit about the farm you farm on. It`s a farm
you grow up.

BIRD: Right.

HAYES: Where in Ohio is it?

BIRD: We`re at central Ohio. It`s northeast of Columbus, just 30
minutes. I -- we`ve been in farm for 16 years. My dad grew up on a farm
and because of the little urban sprawl, we bought a farm further out in the
country.

And we`re produce farmers. So, we`re especially crops, we`re not
commodities. We don`t do corn and soybeans. We did in our history and now
we switched to produce solely.

We do the CSA subscriptions where people pay ahead and every week,
they get a bag of produce. We do farm to school. But we grow about 65
different types of produce.

HAYES: What are you seeing in this drought right now? I mean, how
is it affecting you?

BIRD: This drought this year has really affected us. We had our
first three plantings of our sweet corn failure, which -- I was just on NPR
earlier this week and said to them, oh, it`s 20 acres of sweet corn and
they`re saying, oh, so you`re really small. I said, well, that`s $40,000
to our family. That`s a $40,000 crop loss. And to a small farm, that`s a
ton. We`re produce.

The bigger issue is also, we being especially a crop farm don`t have
the same types of insurance that commodity farmers do and so, we`re
underinsured and uninsured industry. So, we don`t have any way of
regaining those losses.

HAYES: We should note that when you say you don`t grow commodities,
the vast, overwhelming majority of what farms in this country do are grow
commodities, right? And they`re large, industrial farming of things like
wheat and soy and corn.

There`s just, to drive home the point about -- and the sweet corn
didn`t grow because it was too hot or too dry?

BIRD: It was too dry. I mean, it hasn`t -- we`re about five inches
behind in our rain right now, and also the heat, that`s something people
are not talking about. We talk about the drought, the lack of water, but
the heat.

I mean, we`re extreme heat, 105, 107 days. That doesn`t happen in
our area of Ohio and corn and all produce can only grow during very certain
temperature ranges.

HAYES: I spent a lot of time reading about corn sex yesterday and I
talked to a few farmers who were walking me through this very complicated -
- sort of a miracle if they get it together to produce the kernels.

BIRD: We were really worried the other day because we couldn`t find
our pollinator melons that didn`t get planted correctly, the boy melons and
girl melons don`t meet up, we don`t get water melons.

HAYES: I want to show this photo of your nieces, because it`s both
sort of depressing and poignant, but also adorable.

This is your nieces Olivia, Elle (ph) and Sophia (ph) who are
standing next to the sweet corn which should be three or four feet higher
than that.

BIRD: Oh, yes.

HAYES: That is what drought and heat look like at the individual
level of someone trying to extract nutrients from the earth.

BIRD: And that was planted in April. You can see on the right, the
ones that have tasseled. So, once the corn`s tasseled, it stops growing.

UNIDENTIFIED MALE: So, that`s as high as they`re going to go.

BIRD: Yes, as high as they will get. And they won`t make the ear of
corn. So, it`s just done.

My brother, who is the main producer, he`s already tilled under our
first two plantings, and now we just now have acres sitting completely
untouched, ungrown for the rest of the year.

HAYES: So, what do you -- I mean, when you think about what, OK,
let`s say this has nothing to do, this particular drought has nothing to do
with the fact that we`re shoving carbon into the atmosphere and it`s
warming the climate. But, eventually, there`s going to be more of these.
That`s just the way the physics work.

What goes through your head when you think about even just the
sustainability of this as an enterprise that you`re going to do for your
life, you know, 20 years from now what this conversation is going to look
like?

BIRD: For us, everything is diversifying. I mean, we have to now,
we use the unheated greenhouse structures hoop houses which USDA is excited
about and pushing. We have one of their high tunnels.

And looking at other ways of growing tomatoes or something that we
can kind of control better, we can irrigate and we are kind of going away
from sweet corn and more towards crops that we can irrigate.

HAYES: I want to play you something which is an amazing bit of sound
from the CEO of Exxon, Rex Tillerson. Obviously, Exxon, one of the big oil
companies and they`ve spent a lot of money convincing -- trying to convince
people that the scientific consensus is that global warming is not true.

Here he is admitting, yes, we`re warming the atmosphere with our CO2
emissions, but don`t worry about it, we can engineer our way out of the
problem. Take a look.

(BEGIN VIDEO CLIP)

REX TILLERSON, EXXONMOBIL CEO: I`m not disputing that increasing CO2
emissions in the atmosphere is going to have an impact. It will have a
warming impact. How large it is, is what is very hard for anyone to
predict. And depending on how large it is, then projects how dire the
consequences are.

We have spent our entire existence adapting, OK? So, we will adapt
to this. Changes to weather patterns that move crop production areas
around, we`ll adapt to that. It`s an engineering problem. And it has
engineering solutions.

(END VIDEO CLIP)

HAYES: What do you, when you hear that, what is your reaction to
that? It seems like Rex Tillerson is ready to move your farm.

BIRD: Right. Well, he`s saying, "We`ll adapt, we`ll adapt." Who is
going to adapt? I mean, the petroleum companies will adapt on how their
engineering? I mean, farmers every year, this year, we`re talking about
this massive drought.

But people are saying last year, we have the wettest spring, the
wettest year in Ohio, second wettest year in history in Ohio. That really
affected our crops. Actually, we had a worst year last year with it being
too wet.

Three years ago, it got down to negative 27 in the winter for a
couple days in a row. Again, not in Ohio region. So, it killed -- we were
berry farm actually, we wanted it to be a berry farm, and it killed all of
our berries off. So, we had to adapt after that to having a really wet
year to this year.

And so, this year, we changed our whole CSA model because last year
was so wet and now it`s so dry and so everything is changing every year.
We`re having to adapt on the ground.

GOODMAN: I mean, you`re really making the point that we talk about
global warming, but it`s really a climate disruption.

HAYES: Right.

BIRD: Yes.

GOODMAN: It`s not that it just gets hotter and hotter and hotter.
It`s that it becomes increasingly unpredictable.

BIRD: It`s extreme.

GOODMAN: I had a major proposal for this network and every network,
that when they do the weather, which everyone tunes in to, they want to
figure out what to wear and what not to wear every day because it`s getting
hotter and hotter this summer, that every time they shout extreme weather
with those lower thirds that flash it, they also flash climate change.
They also flash global warming.

That no meteorologist should be certified as a meteorologist unless
they understand what global climate change is about because of your farm
and because of what`s happening to people around this country and the
droughts, the drenching rains in Florida right now, many Chinese have died
because of drenching rains in China that they haven`t seen before, like in
60 years.

BIRD: Right.

GOODMAN: This, we have to do something about this. We`re
experiencing what other parts of the world, like the desertification of
Africa, the concern about the submersion of islands.

HAYES: Right.

GOODMAN: Place like the Maldives. We have to do something about it
and it`s coming home to roost.

HAYES: And farmers in many ways the canaries in the coal mine. I
mean, that`s what, you know -- we`re seeing what`s happening to
agricultural prices. I want to -- I want to get response, Josh, because I
know you want to respond to that.

And I want to bring in the chief regulator of commodities and what
are especially the global commodities markets right, after we take a break.

(COMMERCIAL BREAK)

HAYES: We`re talking about climate disruption and the drought that
has gripped much of the country and the effect it`s having on food prices
that are soaring.

I want to bring in Gary Gensler, chairman of the U.S. Commodity
Futures Trading Commission. It`s an independent regulatory body that
oversees commodity`s markets.

Gary, thanks for joining us this morning.

GARY GENSLER, CHAIRMAN, CFTC: Good to be with you, Chris.

HAYES: All right. What we have seen -- there are two parts to this
story, which is why I want to bring you in and we have Bryn on what it
looks like on the ground.

In the commodities markets, when we`re talking about soy and corn,
we`ve seen the spike in prices. The spike has been the fundamentals driven
by drought and then that`s amplified by what seems to someone who`s been
following us for the last four years like a pricing system for commodities
that has grown increasingly volatile and that volatile, you know, cashes
out in very real ways.

I mean, when we export a lot of grain throughout the world and when
prices spike, it means that somewhere -- somewhere else in the world with
not a lot of money is paying more for their bread, if we`re entering a
period of time in which these kind of climate disruptions are more common,
is there anything to be done from the regulatory side in terms of how
commodity markets function that can reduce or smooth over that volatility
as oppose to exaggerate it?

GENSLER: Well, Chris, what Commodity Futures Trading Commission does
is ensure that these markets are free of fraud, manipulation and through
something called position limits, limits the size of any one speculator`s
role in these markets. So, when a drought comes along, as you say, as
fundamentals come along, we have to watch even more closely to ensure the
markets are working for the farmers like Bryn.

HAYES: But that seems to be the issue, right? Because we`re getting
at something elemental about how human beings interface with the planet.
Which is the first thing we did as people was farm and farming is volatile
and we have created all sorts of ways of trying to hedge against that
volatility, smooth over that volatility, and yet, it seems here we are in
2012 and the markets are -- don`t seem to be smoothing over the volatility.
They, themselves, seem very volatile.

GENSLER: Well, we`re not going to repeal the laws of nature and
weather patterns and risk, but what these markets do is help farmers in
corn and wheat and soy to hedge some of that risk with a product called
futures and increasingly maybe even a product called swaps. But we have to
make sure the speculators aren`t taking in excess of spot in this market.

HAYES: Can you do something for our audience? Can you explain what
a future is? It`s a very important concept, but for folks that aren`t
trading in commodities, just explain when you purchase a future, what are
you doing?

GENSLER: I`ll give it my best. My 85-year-old mom sometimes asks
me. They started 150 years ago that a farmer planting corn or wheat could
say, I want to lock in the price at harvest time. If I lock in that price
up in Chicago on the markets, then come harvest time I`ll know that I`m
going to get, well these days, $8 a bushel of corn. And I don`t actually
have to deliver the corn because they might end up just settling out for
cash at harvest time.

HAYES: What does that mean?

GENSLER: All right. So, to put it more easily, the farmer knows
I`ll get that $8 at harvest time regardless if I deliver the corn to some
Chicago grain elevator and the other side is usually a speculator. Hedgers
and speculators meet and they know they`re going to exchange either money
or corn at $8.

HAYES: They`re taking a bet, people on either side of the bet,
right? You got to have someone on the other side of the bet.

More on what the future of commodity and food looks like in a warming
planet after this break.

(COMMERCIAL BREAK)

HAYES: Food prices in a warming planet. We have Gary Gensler, who`s
head of Commodity Futures Trading Commission, with us via satellite. And
Bryn Bird is a farmer in Ohio.

Do you have any response -- listening to Gary talked about how this
system is working on commodity level?

BIRD: Right.

HAYES: And I should reiterate you do not --

BIRD: We do not use -- I mean, we used to do commodities. My family
originally did commodities 15 years ago, but we do not now. But I guess I
work also for a little coalition, a nonprofit in D.C., so, I work around
the country looking at these issues, as well.

One of the parts that I see is when we`re paying farmers out, we`re
paying commodities and we`re setting these prices, aren`t we limiting their
versatility? Their adaptation, as you were saying. Like farmers don`t
have to adapt to these climate issues, they just --

GOODMAN: Grow whatever --

BIRD: They just grow what`s going to grow. I mean, I`ve seen this
across the country and what`s happening in the Dakotas, like we were
saying. They used to be the largest grower of dried beans and now, they`re
not growing dried beans and they`re growing corn and soybeans because the
prices are going up, and it`s a promise market.

They -- when you grow the dried beans, there`s no one setting the
market for its price. It`s volatile and so they have to adapt.

And I just wonder, are we creating agriculture that`s not adapting to
climate change?

HAYES: That`s a profound point. So just -- explain though to what
the link is here because again I grew up in the Bronx, I hardly saw a tree
until I was 12.

BIRD: Our farm, we do not have prices set for us. We don`t know
what our future prices are. When we go to the farm market, if the guy
across from us sets his tomatoes at $2, we`re having to set our tomatoes at
$2. If everyone has a great tomato season, then the price of tomato comes
down.

So, this year, we`re doing great on tomatoes. So, we`re able to set
the price in the market. And I see that. And so, we`re having to adapt.

Sweet corn didn`t work for us, we`re growing more tomatoes. We are
putting up high tunnels. We are going to extend our season and do season
extension. We`re adapting to the climate and to this volatile seasonality
that`s starting to --

(CROSSTALK)

GOODMAN: Can you state why you don`t grow soy beans?

BIRD: We stop growing soy beans, a lot of it has to do with our
land. We don`t have enough land. We only have 110 acres. All the land
around us is also taken by other farmers that lease out (ph).

HAYES: Gary, does the current system in the way that these
commodities are traded and the amount of money there is in them for Wall
Street, as well as the actual farmers and end users, is that limiting
adaptability? What do you make of what Bryn`s saying?

GENSLER: Well, I think for many of her products not future products
to hedge that price. For corn, soy and wheat, there are. I think it helps
those farmers because they can lock in a price and then focus on what they
do well in tilling the field and focusing on their crops.

So, she`s -- she has a less ability to use these markets.

HAYES: Right, but the question.

BIRD: Right.

HAYES: But if those markets are artificially reducing the -- are
artificially locking in a price that is going to be harder to get in the
future because of the volatility of the climate, if we`re heading towards
more droughts, is it locking in a kind of unsustainable vision of what
agriculture looks like and we grow here in the U.S.?

GENSLER: Well, there`s some of that, as you know, hedgers are
meeting speculators in the marketplace. So, both sides are, in a sense,
betting on those future droughts.

HAYES: Josh?

BARRO: I think two separate issues here. One is you have this
ability to hedge, but also explicit government policies that are meant to
support prices for people who are growing corn and soybean and other
commodity products that encourage them to do it even if the market
fundamentals move away from them.

So, you can have -- you have a hedging market in oil, but when oil
prices rise, you can only hedge so much. Airlines have to adjust and
change their business models.

You`re growing corn, you don`t necessarily have to adjust.

HAYES: Right. We talked about crop support and insurance.

Gary Gensler, Commodity Futures Trading Commission, stick around if
you don`t mind. We`re going to keep talk about this, right after we take
this break.

(COMMERCIAL BREAK)

CHRIS HAYES, HOST: Hello from New York. I`m Chris Hayes.

With me this morning, it`s great to pleasure to have Bryn Bird,
farmer and farming advocate, Amy Goodman of "Democracy Now!", Stacy-Marie
Ishmael is checking her Twitter feed of CUNY Graduate School of Journalism,
Josh Barro of "Bloomberg View", and joining us from satellite is Gary
Gensler, chairman of U.S. Commodity Futures Trading Commission.

Gary, how have the commodity`s markets changed? They changed a lot
in the last 10 years. There`s been a huge amount of money that poured into
those markets in the last 10 years. How have they changed? And how are --
do you hope they change in the next 10 years in the wake of Dodd-Frank?

GARY GENSLER, CHAIRMAN, COMMODITY FUTURES TRADING COMMISSION: Well,
they`ve changed in the last 10 years by more financial actors, pension
funds and index investors, more speculators in the market. How I hope they
change in the next 10 years is that they`re more transparent, there`s large
market that was at the heart of the crisis, swaps, gets regulated and is
safer for America and more transparent for the users of the products.

HAYES: Josh, you just asked a question during the break about why
you can`t --

JOSH BARRO, BLOOMBERG VIEW: Yes.

HAYES: I want you to repeat that question even though, we had the
conversation because I would like to bring in the viewers on it.

BARRO: The question I had was why you have a future`s market in
things like corn and soybeans, but you can`t have it in tomatoes and the
other crops that you grow.

BRYN BIRD, OHIO FARMER: You did a great job explaining it.

STACY-MARIE ISHMAEL, CUNY GRAD. SCHOOL OF JOURNALISM: Well, what I
was saying -- because for things like corn and soybeans, you know, you can
say, OK, this is a bushel of corn, this is a bushel of wheat, (INAUDIBLE)
bushels, or this is a barrel of oil, this is a bar of gold. Whereas for
something like tomatoes, they`re not necessarily fungible, and tomatoes
look different across seasons, et cetera.

And you also have storage problems with them. You can store a corn.
You can store a wheat on mass in huge bushels. But storing tomatoes is
very difficult.

So, the thing about having futures and you`re saying, I`m going to
pay you this today for delivery six months from now, you need to have
clarity on what that delivery is going to look like. How much it`s going
to weight. How much it`s going to be in it. Basically that there is a
consistent standard across time.

HAYES: So, the combination of this volatility and the way that the
U.S. crop support system works is a huge disincentive to do what you are
doing.

BIRD: Right.

HAYES: And yet you`re doing what you`re doing.

BIRD: Yes, people ask us all the time. I sit there sometimes and
wonder like, what is my brother -- my brother is the main producer, like
sacrificing every day in the fields and at the end of the day, having this
huge crop loss. But -- I mean, the biggest thing is you love it. You
really end up loving farming, you love why you do it and you go out there
every day and want to create produce and create food for individuals. We
did the CSAs and I know every week, we feed 215 families and that`s kind of
why we do it.

But it is hard. It is volatile and it`s taking a lot of adaptation
right now.

AMY GOODMAN, HOST, "DEMOCRACY NOW": Bryn, I asked you before why you
don`t grow soybeans. But talk about the other reason and this involves
corporate control on agriculture.

BIRD: Right. It does.

GOODMAN: How much that is influencing the face of farming around the
world?

BIRD: Right. I mean, a big part of why I know that a lot of people
aren`t growing commodities does have to do with corporate control of
Monsanto on our seed stock and our growing practices any more. It`s really
hard to get non-GMO seeds. This year, Monsanto also did have the first
consumer-ready GMO I guess is the way that they are calling. But it was Bt
--

HAYES: Genetically modified.

BIRD: Genetically modified, but a Bt sweet corn. So, it`s a sweet
corn that you can grow now and also it`s a Monsanto sweet corn. And that
did raise a lot of flags with a lot of our customers, a lot of patrons who
have been with us for years, calling us, asking, are we going to start
growing this Bt resistant sweet corn.

And, you know, we are choosing not to. We really believe in the
genetic variably that is needed actually in this climate condition. That`s
the huge part is that we need genetic variably in our seeds to overcome
this climate change.

GOODMAN: Why does it help?

BIRD: For us, like right now, we`re trying to find seeds that are
more resistant to heat. Not actually drought but heat-resistant seeds.
And so, knowing that there are seeds out there, with my work with Rural
Coalition, we in Oklahoma last year, we are with Seminoles and other tribal
communities, and they brought seeds to a dinner and we exchanged them with
each other and took them back to our areas and we`re all growing them.

They had the drought and they actually lost a lot of their seeds and
we then had to call all of our friends and say, did you get those seeds?
Did you grow? Can you save those and bring them back and it`s kind of neat
to see how we were working as a community to overcome like this --

HAYES: Adaptability and durability.

(CROSSTALK)

BIRD: Yes, and I was saying that to you, that last year in Oklahoma,
one day they had the biggest drought and then the next day a tornado, flash
flood and an earthquake in one day.

BARRO: This is interesting, though, right, because one thing I was
stuck by is despite the fact that we have these, you know, extremely high
corn prices, this is likely to be the third largest corn harvest ever in
the United States. And so, we do have -- well, partly that`s because we`re
growing more corn before the failures start but we have much better
adaptability than we had 70 years ago during the dust fall (ph).

So the farming industry can be more, more adaptable to climate change
than it used to be. But if you have government policies that basically
ensure farmers against losses, then they have less of a reason to adjust to
the fact that the climate is changing, because they can just expect the
government to cut them a check if things go badly.

(CROSSTALK)

HAYES: I just want to ask, Gary, if it`s true we`re still going to
have the third largest corn yield, if that`s the projection, are you
confident that the price -- the price on these commodities the market is
finding is the true price and it is not being driven by, let`s say
irrational, the opportunistic --

(CROSSTALK)

HAYES: -- you know, irrational anxiety about weather conditions.

GENSLER: Well, Chris, we`re not a price-setting agency. But I tell
you what will give us more confidence if government policy would fund our
agency. There are some in Congress that want to cut our funding.

(CROSSTALK)

GENSLER: I mean this, I mean this. It wouldn`t make sense in the
middle of a drought to cult the funding of the Commodity Futures Trading
Commission.

HAYES: Who wants to cut your funding?

GENSLER: There a lot of people who want to because of the Wall
Street reform efforts. I mean, we`re pressing ahead. Eight million
Americans lost their jobs, they`re trying to get in place reform and there
are some that would prefer not.

HAYES: But, name the some. There`s lots of people in Washington.
Who wants to cut your funding?

GENSLER: Well, the House of Representatives have considered that for
two straight years. Cutting us. We`ve made some progress.

But we`re five -- we`re overseeing a market five times the size that
we used to oversee in corn and wheat and oil and then we add the swaps
market, the credit derivative swaps and so forth on top of it. We really
need to have effective funding and cops on the beat.

BARRO: Can you remind me, Gary, is CFTC still overseen by the
agricultural committees in Congress?

GENSLER: Yes, the House and Senate Agriculture Committees. But it`s
the Appropriations Committee that deals with our funding.

BARRO: Right. But this is something that really strikes me about the
CFTC, and there was a comment that Gary made earlier as well, that we need
to make sure this market works for farmers. That`s all right. We need to
make it works for consumers of food.

ISHMAEL: Exactly.

BARRO: So, this is great for farmers, corn prices --

ISHMAEL: Well, it`s great for commodity farmers.

HAYES: Right. It`s great for huge, industrial, agricultural
concerns.

(CROSSTALK)

BARRO: Or anybody who`s growing these crops that are -- the prices
have gone through the roof. But that`s -- we really want oversight of an
agency like the CFTC by organs within the government to see low food prices
as a good thing, which is not necessarily true when you have the interests
of the agricultural industry at heart rather than the interests of
consumers broadly.

HAYES: But you don`t see local food price as a good thing?

BIRD: No, definitely not. I mean --

HAYES: It used to be -- I should note, there`s used to be -- this
distinction used to be the political central political axis of conflict in
American politics.

BIRD: Right.

HAYES: You know, if you go back to 1890, it was that one side there
are people who were producing food who wanted the price to be high. On the
other side, there were folks in urban centers who were eating, who wanted
it to be low and hoping to eat and this was the dividing line of coalition
of politics, largely because of the degree of which food as a percentage of
disposable income has come down so dramatically for 50 years. It just
figures less and less in people`s household budgets, at the same time, I
should note, we have 45 million Americans on food stamps, in the midst of
the wake of this crisis.

GOODMAN: We don`t want to talk about aspirational eating.

HAYES: No, we don`t want, no.

GOODMAN: Something I hope to eat.

HAYES: No. And, so, there is this question in this place where this
price really makes a difference. I mean, here`s -- you know, when we saw
what happened to food prices globally -- in 2007, 2008 was the last time we
had a huge spike, that created unrest across the world. I mean --

ISHMAEL: That was particularly in rice and wheat.

HAYES: Rice and wheat.

ISHMAEL: So, I think that`s one of the distinction some analysts are
making what`s going on right now. The crops that you`re seeing masses
increases on on a price basis on the same fundamental food crops that
sparked a lot of the uprisings in 2007, 2008 that worry (INAUDIBLE).

HAYES: Because wheat is so important to people`s bread.

ISHMAEL: Soybeans are going to have an effect in China because
soybeans are used to feed their livestock.

HAYES: And corn is going to have an effect on meat -- this fall,
we`re going to see meat prices go up.

GOODMAN: Russia stopped exporting wheat --

ISHMAEL: Russia has stopped exporting wheat a number of times. This
is something they have done. Look, we`re going to do this, sometimes for
political reasons.

GOODMAN: Which had a huge effect on Iran.

ISHMAEL: Exactly.

HAYES: Gary Gensler, chairman of the U.S. Commodity Futures Trading
Commission, I want to thank you for joining us and I want to extract from
you a promise that you`ll return to the table here in New York next time
you`re here and we can talk about the LIBOR scandal, which the CFTC has
been a key regulatory player in uncovering, and what happened at the broker
dealer Peregrine in which it seems that there is possibly up to $200
million missing in a customer`s money.

So I want to have you back at the table next time you`re in New York
to talk about that.

GENSLER: Look forward to it, Chris.

HAYES: Sounds good. Thank you, Gary Gensler of CFTC.

Bryn Bird, second generation farmer from Ohio, I cannot thank you
enough. I learned so much from you this morning.

BIRD: Thank you.

HAYES: Thank you. I hope we can have you back.

Will America intervene in yet another conflict in the Middle East?
That`s up next.

(COMMERCIAL BREAK)

HAYES: Mitt Romney is going to Israel this week amid one of the most
intense periods of violence the start of the Arab Spring.

By most accounts, the violence in Syria where anti-government groups
are fighting an increasingly, evenly matched battle with the regime of
President Bashar al-Assad has escalated into a full blown civil war that
could ensnare the rest of the region.

On Wednesday, rebels detonated a bomb in Damascus that killed several
of Assad`s top lieutenants, including his defense minister and brother-in-
law. And this morning, there are reports that government forces have been
bombarding neighborhoods in Damascus with helicopter gunships and tanks.

The stakes of the situation are incredibly high not just for Syrians
and the Arab world, but for the U.S. and its allies. The White House has
warned the Assad regime that it will be held accountable for the security
of its stockpile of chemical weapons, one of the largest and most advanced
in the Middle East.

Here`s how U.S. Defense Secretary Leon Panetta summed up the conflict
on Wednesday.

(BEGIN VIDEO CLIP)

SECY. LEON PANETTA, U.S. DEPT. OF DEFENSE: This is a situation that
is rapidly spinning out of control.

(END VIDEO CLIP)

HAYES: On Thursday, the U.N. Security Council failed for a third
time to agree on even basic sanctions for Syria after vetoes by both China
and Russia.

Here`s Susan Rice, the U.S. ambassador to the U.N. after the vote.

(BEGIN VIDEO CLIP)

SUSAN RICE, U.S. AMBASSADOR TO THE UNITED NATIONS: It is a rapidly
deteriorating conflict that is costing hundreds of lives each day and that
threatens to engulf the region in a wider war.

We and others increasingly will have no choice but to look to
partnerships and actions outside of this council to protect the Syrian
people.

(END VIDEO CLIP)

HAYES: Joining us now at the table are: Akil Hashem, former Syrian
brigadier general who resigned in 1989, and Sarab Al-Jijakli, founder of
the National Alliance for Syria, Colonel Jack Jacobs, MSNBC military
analyst is back at the table, as well.

Gentlemen, it`s really wonderful to have you here.

JACK JACOBS, MSNBC MILITARY ANALYST: Thank you.

Let`s start here with the first question, which is, we had seen in
the last week a variety of dramatic escalation of the capabilities of the
rebels. What does this say about the tenuousness of the regime`s hold on
power? Is this -- are we going to see the fall of Assad soon, which I
think is the question everyone is asking?

BRIGADIER GEN. AKIL HASHEM (RET), SYRIAL HASHEM: Let me give you
first and important the revolution in Syria. First of all, the Syrian
revolution went through three phases. First phase was like six months. It
was completely peaceful demonstration.

HAYES: Not violent, March 2011.

HASHEM: Not one stone thrown on the regime forces and yet at that
six months, 10,000 people were killed in this peaceful demonstration. We
saw hundreds of thousands of Syrian people demonstrating, singing and
dancing in the squares of the cities.

Now, the second phase happened when the defection start and establish
of the Free Syrian Army which was joined later on by civilians who went to
fight the regime. I call them under one umbrella, the Freedom Fighter in
Syria.

And this also took like six, seven months, and a defensive strategy,
was committed by the FSA and the freedom fighters to defend the civilians
in their homes and in their cities.

Now, we are entering the third phase, which is the strategy has
changed from defensive strategy to offensive strategy and we mark that
change by that incident happened in the very important headquarter of the
national security of the Syrian regime.

HAYES: This was a bomb that went off that killed three top security
--

HASHEM: Four.

HAYES: Four top security officials. That was the most striking of
all the sort of forward action that we`ve seen.

(CROSSTALK)

HAYES: Including Assad`s brother-in-law.

The question is, though, in terms of military capability, where we
are right now, the free Syrian army does not have the military capability
just at the military level to defeat the regime. Is that not the case?

SARAB AL-JIJAKLI, NATIONAL ALLIANCE FOR SYRIA: Sure. I think just
one thing to note is that this is from day one a popular resistance, a
popular uprising. So, when we break down the three phases, we must
understand that from civil resistance perspective, the population rising
up. When we talk about the Free Syrian Army, it`s the population rising
up, it`s the factors in the army finding their role in the revolution.

And so, where we are today in terms of the last week, we found that
the battle for the Damascus isn`t necessarily about holding ground. It`s
about showing the rest of the country symbolically that the regime no
longer controls, not only the capital, but anywhere of Syria.

JACOBS: Can the Free Syrian Army beat Assad forces without
continuing to demonstrate its capability to insinuate itself into places
like Damascus and, therefore, cause further defections from the Alawite
forces? Is that possible? Or are these people going to stick with Assad
until the very end?

HASHEM: Let me jump to this question. First of all, eventually, and
this is a matter of fact, the regime would collapse and go.

AL-JIJAKLI: Just a matter of time.

HASHEM: It`s a matter of time, but this will cause the Syrian people
thousands and thousands of lives to be killed. Now, there`s a very
confirmed number that 25,000 Syrian people were killed and double this
number missing since more than six, seven months and we don`t know anything
about them. Most likely, most of them, if not all of them already killed
and dumped in mass graves.

Now, the power of balance between the freedom fighters and the regime
is for the privilege of the regime. He had the tanks, the vehicles, the
artillery, the medicine, the airplanes, the helicopters, everything.

AL-JIJAKLI: Chemical weapons.

HASHEM: He cannot use it --

HAYES: Let`s talk about that in a second.

HASHEM: I`ll talk about that later on, that`s a completely different
issue.

But the freedom fighters have three things the regime lacks
completely, zero. First of all, the will for sacrifice, and they proved
that by sacrificing thousands of people. Second, the belief in course and
the courage, the utmost courage, these very important mental factors, moral
factors, but they are, we count them when we analyze the balance of power.

HAYES: There is a psychological dimension of this, which is
important, right? Which is that demonstrating the weakness of the regime
becomes a self-fulfilling prophecy because you want the people that are
protecting the regime to just read the writing on the wall to make a
calculated self-interest that they no longer will benefit in the future
from standing by Assad and, ultimately, come over to the side of the
rebels.

I want you to talk about that, I want to talk about chemical weapons,
and I really want to talk about who the Free Syrian Army are and who the
freedom fighters are, because we have watched a variety of uprisings in the
region where after it was all over, the world was asking exactly who just
took control of this country, after this break.

(COMMERCIAL BREAK)

HAYES: Discussing the latest dramatic developments in Syria. I was
talking to a number of folks who have been watching the situations and
folks in government, et cetera, yesterday. The big question is when you
say the Free Syrian Army, the freedom fighters, the popular uprising, I
think it`s undoubtedly the case, I think, that the regime is not very
popular, has alienated people, has held on the power through authoritarian
means.

But just who is the Free Syrian Army? If it is the case that the
fall of the regime is inevitable and if it happens at a more accelerated
scale than we thought, if in fact they`re able to demonstrate cost-benefit
analysis to folks that are defending Assad right now, what does the day
after look like? Who has the guns? Who has the power? Who are the folks
that are the resistance?

AL-JIJAKLI: I think we should look at the resistance in a broader
perspective. For one, the resistance is grounded in local organizing.
It`s grounded in the local coordinating committees, the activists on the
ground who have been pushing from day one a civil resistance agenda that
has been supplemented as people have found their role in the revolution,
such as defectors from the army who -- what do defectors in the army do?
Their role as Syrians is to support and defend the protesters, defend the
revolution.

As the brigadier general earlier said, basically, that has now
shifted from a defensive approach to more of an attack approach in
Damascus, in Halab, in Aleppo, the second city, which is actually where we
should be discussing and focusing on now because that is a clear strategy,
not necessarily to retain ground, to create symbolism in Damascus, but to
retain ground and create a separation of the country.

HAYES: Again, what`s the -- let`s say the Assad regime falls while
we`re on air. Let`s say he flees the country right now while we`re on air,
what happens?

AL-JIJAKLI: Right now, the entire revolution is organized bottoms
up. Every town, every locale, every district is organized both from a
civil perspective, meaning activists who coordinate the activities in that
area and military councils on the ground.

JACOBS: Who are the national leaders?

AL-JIJAKLI: These are the national leaders. These are the national
leaders. The Syrians local up who have been from day one coordinating the
activities of this revolution.

JACOBS: What you`re talking -- if the Syrian government goes down
right now, today, you`re talking about government by a Soviet of some kind,
right? A committee is going to -- aren`t there any national or potential
national leaders among these localities?

AL-JIJAKLI: These are -- these are our national leaders because you
don`t know them doesn`t mean they don`t exist.

JACOBS: No, no, I`m not saying that -- the real question is, is
there one or more national leaders who is actually going to be able to
exert leadership and formulate form a national government?

The answer to that, what you`re suggesting, if the answer to that is
no, then if the United States or anybody else supports the Free Syrian
Army, we don`t know what the result is.

AL-JIJAKLI: We have to give time for the revolution to bear fruit.
You have to understand that after 40 years, this regime has been in power
and they have done everything in their power , to basically --

HAYES: Destroy the civil society, right.

AL-JIJAKLI: The civil society. What we`ve learned in the last year
and a half is the Syrian people are reclaiming that and that`s what we`re
doing right now on the ground, bottoms up.

GOODMAN: General, I have a question. After the killing of the four
inner circle of Assad, do you see something like happening, like happening
in Hama in 1982, when you were a general for his father, for Assad?

HASHEM: Yes.

GOODMAN: What was your involvement then? And do you see this
happening now?

HASHEM: First of all, I was as the last 10 years of my military
career as a professor in the higher military academy in Damascus. So, I
was --

GOODMAN: At that period?

HASHEM: -- completely away in any military activities. At the time,
I immediately after the Hama incident applied for resignation, which I
couldn`t get it until 1989.

GOODMAN: How many people did he kill then?

HASHEM: The estimates it varies between 25 to 47. But, you know --

GOODMAN: Thousand?

HASHEM: Thousands.

AL-JIJAKLI: So, all of us have lost people from Hama and the
general`s distinction is correct. It`s 40,000 plus. Even the regime
bragged about --

HAYES: This is a massacre that happened in 1982.

HASHEM: The most important thing because I was there, I was there in
the military and I know so many people and military people from inside
Hama, most of the killing, 90 percent not in a struggle, not in a fight,
not in the streets, they went to homes. Home by home, killing every male
over 15 years old -- home by home. And in neighborhoods away from where
the struggle broke up, like two kilometers, three kilometers, neighborhood
had nothing to do with what happened in Hama in 1982, but they killed
everybody.

HAYES: So, this, this brings me to another concern that people have.
And these questions are not, I`m not trying to insinuate this.

HASHEM: I have to have to have a time to answer --

HAYES: But before you do that, I just -- because you brought up the
massacre in Hafez Assad, the country is essentially 80 percent Sunni,
right? It`s about 10 Alawite, 10 percent Christian, more or less.

HASHEM: Seventy percent Sunni.

HAYES: Seventy percent Sunni.

HASHEM: Twelve percent to 15 percent Christian. Ten percent
Alawite, and 5 percent the rest.

HAYES: So, there`s a concern that of in the fall, in the wake of a
fall of the Assad regime of reprisal killings because there has been a
sectarian dimension to the Assad rule, and small minority and there is,
there is concern, I think, among folks that I talked to that I have been
reporting on about something that looks like Iraq, say, circuit 2004, 2005
in which you had death squads and tremendous sectarian violence. I would
like you to address that.

HASHEM: So, the question of the colony, about -- talking about what
happened after the fall of the regime. First of all, let`s make it clear,
we, Syrian people, will face dark days and dark times and chaos and unrest
after the fall of the regime more difficult, 100 times than what we are
facing right now.

This is the nature of the revolution. So, this is -- we cannot say
that after the fall of the regime, immediately we maintain the stability
and security. This would be a huge procedure, very long procedure.

Now, your question is what might happen, the sectarian civil war,
yes. I believe there will be a very much individual incident of revenge.
But later on, immediately, the Syrian people get back to their sense and
they will go to the same attitude when they lived together for thousands of
years and this will stop. It will happen, but individually, not on a large
scale.

HAYES: Sarab, do you think that -- is that your sense and do the
local, if the organizing happening at the local level that you have been
talking about, these local counsels that have been the pillars of the
resistance, are those multi-sectarian, A? And, B, do they have enough
organizational control to stop the kinds of reprisal killings that people
are worried about?

AL-JIJAKLI: This brings us to the aims and the vision of the
revolution from day one, which is to set up society based on pluralism,
right? To ensure that everyone has representation, everybody has the
opportunity in Syria as we`ve seen in other nations.

So, yes, the people on the ground have done everything they can to
convey this message. From day one, alternatively, the regime succeeds by
breathing sectarian hatred. What they`ve done since day one is instigate a
sectarian response from everyone.

That`s why they go into places like Hama and Homs and desecrated
mosques. That`s why they burn down mosques. That`s they`re using mass
rape, that`s a tool of war. That`s what they`re doing to instigate a
sectarian response. Albeit, they are using loyalists who are close and who
may hail from the same sect as the president does, as the regime does, to
convey these acts.

So, he`s trying to create a situation where he is inseparable from
the rest of his community.

HAYES: I want to talk about what role the international community is
playing, what role it should play and what role as us as citizens of the
United States, the United States government, should be playing, right after
we take a break.

(COMMERCIAL BREAK)

HAYES: Hashem, former brigadier general in Syria, you left in 1989.
You wanted to -- I want to talk about this question of intervention, or not
intervention because that ends up being this very narrow conversation we
always have about every conflict in the U.S., are we going to intervene or
not, but just more broadly the international response.

You wanted to talk about this, you wanted to add one more point about
the point of the structure of what the Free Syrian Army and the resistance
is.

HASHEM: OK. First of all, this defection started after six months
of the revolution and it created groups, individual groups everywhere in
Syria, smaller group, bigger group, something like that. Have no weapons
except the weapons they took with them when they defected.

And then rapidly, the civilians in Syria start to join these groups
and to compose their own groups. But, you know, in Syria every single
citizen has to pass through the compulsory military service.

HAYES: Right.

HASHEM: So, this basic knowledge of military training is available
to every Syrian. So now we have so many groups inside Syria. I admit, we
don`t have a structure of an army.

HAYES: Right.

HASHEM: Even the leadership and the borders of Turkey, they are not
controlling anything except like 15 percent of the freedom fighters. But
inside Syria, during the last three, four months and I worked in that
hardly, we start to compose what you call it military concept in every
department. Syria is 14 departments. Department like --

HAYES: Like a state, a province.

HASHEM: A province. A province, yes.

So, there is like military consul in Hama, in Homs, in Daraa, in
Damascus --

HAYES: So, a structure is being erected.

HASHEM: But we are going to have eventually and very soon one
command, one leadership for the whole freedom fighter in Syria.

HAYES: So, there have been efforts in the U.N. for sanctions.
There`s been calls for arming the rebels.

Here`s -- I want to play John McCain, U.S. senator from Arizona --

HASHEM: Whom I met.

HAYES: I`m sure, because whenever there`s a problem in the world,
arming the rebels is his solution. Take a look.

(BEGIN VIDEO CLIPS)

SEN. JOHN MCCAIN (R), ARIZONA: Set up a safe zone and together
provide arms and equipment to the resistance fighters.

We can help facilitate weapons to get to the hands of the Libyan
military, those who are fighting against Gadhafi.

The Congress passed a law a couple of years ago called the Iraqi
Liberation Act. The administration has done nothing. We should help them
with arms.

UNIDENTIFIED MALE: If not strategic air strikes as a viable option,
what if any military option would you think realistic and plausible?

CAIN: Arming the Bosnians and recognizing that training has also got
to be part of that.

(END VIDEO CLIPS)

HAYES: This is the kind of "arming the rebels" greatest hits from
John McCain. And the reason I`m playing that, frankly, as someone who is
extremely skeptical of U.S. military intervention, particularly in the wake
of what we have seen in the U.S. and the region over the last 10 years,
which I don`t think has come out particularly well, and yet I`m sitting
across from you, gentlemen, who are telling a story of what is obviously an
incredibly violent regime, this question of arms, whether arm as or money
should be flowing from the United States and the international community --
I`d like to get your sense of that.

HASHEM: First of all, to create the situation, we have a stalled
situation in Syria, very tragic. There is a regime that will not stop
killing people, no matter what. People decided to fight this regime, also
no matter what. Both sides are --

(CROSSTALK)

HASHEM: -- exceeded the point of no return.

HAYES: Right.

HASHEM: So, what we do, the only solution is to have an
international and military intervention in Syria. I called for that since
more than nine months. I went everywhere in the world to get this
international military intervention.

HAYES: Sarab, do you think there should be an international military
intervention?

AL-JIJAKLI: I think the United States government will do everything
in their ability to avoid such a situation. We`ve seen that from --

HASHEM: If there is going to be or not. We`re talking about the
need.

HAYES: I`m asking -- I also want to get his opinion.

AL-JIJAKLI: My opinion is that it won`t happen because it`s not in
the interest of the United States to intervene in this manner. So, whether
there`s a need or not, yes, there`s a need to support the armed resistance
in Syria, period.

People need the weapons so that they can defend their families, their
areas and their regions from the Assad regime, but that is not the reality
politically of what`s going on in the United States now.

JACOBS: I agree. I don`t think it is going to happen. We talked
about the election and nothing will happen until after the election in any
case.

HASHEM: Yet, again, I`m not talking if there will be or not. I am
talking about --

HAYES: You`re saying there should be. Yes.

HASHEM: Should be or not, because this is the duty of the United
States of America as a leader of the free world. This is a duty. This is
not a privilege or not a charity. They have to do that, but,
unfortunately, Mr. Obama is busy right now.

(CROSSTALK)

JACOBS: Unilaterally do that, not now.

HASHEM: I`m not talking unilaterally. I said several times. Four
countries can do that, United States, United Kingdom, France and Turkey.
Turkey for geopolitical reasons because it has like 850 --

(CROSSTALK)

HAYES: But the same day after question extends. Look, I understand
why you would call for this. I completely understand and, obviously, we`re
coming from extremely different places in this conversation.

But the day after question which we see as the day after in Iraq and
the day after in Afghanistan -- I mean, do you want an occupying force?

HASHEM: Not at all, not at all occupying. This is a red line. No
ground troop. And, yet, I ask for the simplest option of intervention and
that is what I discussed with Senator McCain when I met him. I said just
an air missile strike. Got to get every important location for the
security and intelligence agency and the quarter military, the (INAUDIBLE),
the republican guard, just that without the need to sacrifice one life.

GOODMAN: I don`t think you can talk about Syria without talking
about the rest of the area. Without talking, for example, Iran, without
talking about China, Russia, the forces, the United States that are
negotiating at the United Nations right now.

If military was not an option, if you said, we take that off the
table, I think the U.S. would have a very different approach in how it
deals with Russia, Russia extremely angry about what happened in Libya.
We`d have a different approach in how it deals. It will not deal with Iran
on this issue.

HAYES: Right.

GOODMAN: Iran an ally of Syria, and if we said that diplomacy is the
only way to deal with this, you may have a very different --

HAYES: We have to take a break. We come back and wrap this
conversation. Thanks a lot.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

WOLF BLITZER, CNN: Would you support U.S. military action, not
necessarily troops on the ground, but air power, cruise missiles, arming of
the rebels? Would you go that far at this point to get rid of Bashar al
Assad?

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: I don`t think we
should go that far. I don`t think at this point it calls for that type of
military intervention on our part.

BLITZER: So, on this issue, you`re with the Obama administration,
basically, and not with John McCain?

BOEHNER: Probably correct.

(END VIDEO CLIP)

HAYES: Sarab, if we do just stipulate the matter of the
international concerns about Russia and China that there is not going to be
that kind of intervention, which is what you were saying before, what is
your view path forward in this month, say? I mean, are we going to -- is
there a sort of tipping point of momentum that folks in the community that
are organizing want to see, or are we headed towards something that looks a
lot more like a stalemate with different areas being held with different
parts of the regime?

AL-JIJAKLI: It`s a great question. I think what we`ve seen in the
last week is that we`ve shown, the resistance has shown that Assad no
longer controls the capital and no longer has the ability to control all
elements of the country.

What we are seeing as of yesterday is an offensive in Halab, in the
north, second city Aleppo, and that is an extremely critical battleground
because that is all about strategically splitting the country in two.

Now, you had mentioned safe zones, et cetera. The Syrian people on
their own with limited support, with no help from the outside have created
their own zones and are attempting to create a safe zone for operations to
conduct the revolution and finish the job for themselves at this current
moment.

HAYES: Is that your sense of how this is going, as well, in terms of
what we look for in the next month if there is no forthcoming intervention
in military terms?

HASHEM: Of course. If there is no forthcoming intervention, it will
take more time. It will cost more lives. I agree with Sarab just said.
But this is very important issue to explain to the world why the
intervention is necessary.

First of all, all the consequences, all worries of the Western world
of the intervention, like they said it might trigger the civil war or the
sectarian civil war and the separation and the establishment of militia on
control -- all these worries and consequences can easily be zero if this
intervention happened like four, five months ago.

Now, still, there`s a time. But the more we deal with intervention,
the more these consequences and worries will grow larger and bigger.

HAYES: Akil Hashem, former general in the Syria, Sarab Al-Jijakli --
gentlemen, thank you very much. I appreciate it.

HASHEM: You`re welcome.

HAYES: What we should know for the news week ahead, coming up next.

(COMMERCIAL BREAK)

HAYES: So, what should you know for the week coming up?

We should know that while arguments against raising the minimum wage
nearly always warn of the awful effects for small businesses, there`s new
research out showing that the best majority of low wage workers are large,
profitable corporations.

In a study of Census data from 2009, 2011, the National Employment
Law Project, NELP, found that two-thirds of low-wage workers are employed
by large businesses with over 100 employees. And surveying that 50 largest
employers of low wage workers, the NELP found the overwhelming majority
have recovered from recession are profitable, with nearly 80 percent having
profitable for the last three years.

You should also know these firms have executive compensation
averaging $9.4 million a year.

You should know the current federal minimum wage is $7.25 and,
according to NELP, it would be more than $10 today if it was adjusted every
year since 1968 using the consumer price index as a basis. You should know
if you wanted to do something about inequality that didn`t also increase
the big bad government or the debt raising the minimum wage significantly
would be one way to do it.

You should know feminist icon Gloria Steinem is calling New York City
Council Speaker Christine C. Quinn to allow a vote on a bill that would
require businesses to give their employees paid sick leave.

You should know, Ms. Steinem is one of the most prominent supporters
of Speaker Quinn`s mayoral ambitions, has signed a letter along with 200
influential and notable women, urging her to bring the measure up for a
vote, but Quinn has said she has no plans to do so.

Opponents of the bill say it will hurt small business, but you should
know that a 2011 study by the Institute for Women`s Policy Research
refutes. In San Francisco, for instance, the first city in the nation to
implement paid sick leave, six out of seven employees did not report any
negative effect on profitability as a result.

You should know congressional Democrats say they are prepared to let
all the Bush tax cuts expire on January 1st of next year and then
immediately introduce in the next Congress a bill to reinstate those tax
cuts on become below $250,000 a year.

Despite what you might hear, you should definitely know that such tax
cuts would also be tax cuts for the richest earners since they would enjoy
the lower marginal rates on the first $250,000 of their declared income.

You should know Republicans want the entire tax cuts extended,
including for top earners at an additional cost to the budget of $28
billion just next year. You should know that tax rates for top earners are
among the lowest they`ve since the Roaring `20s and you should know that
Mitt Romney and the Republican Party are single-mindedly devoted to
reducing them even more.

You should know that while Mitt Romney waxes poetic about restoring
America to its former glory, he leaves out that vision for considerably
higher top marginal tax rates paid by his father.

All right. Josh Barro and Stacy-Marie Ishmael are back with us on
the table. I want to find out what my guests think you should know for the
week coming up.

Josh?

BARRO: We should know that on Monday, the NCAA is going to announce
what sanctions it`s taking against Penn State, due to the sex abuse scandal
there. Just this morning, they`re tearing down the statue of Joe Paterno.
But what we have known for decades is that the NCAA is a fundamentally
abusive institution that is built on extracting free labor out of football
and basketball athletes and what we really should be taking from this is a
broad reevaluation of college athletics and why we have this essentially
for-profit activity operating under the auspices of universities.

HAYES: There`s been -- this year has been remarkable. Taylor Branch
of the amazing civil rights -- magisterial civil rights trilogy wrote an
amazing piece on "The Atlantic" called "The Cartel", which is just this
devastating synthesis of a lot of arguments that it made against the NCAA,
and you wrote a piece for "Bloomberg View" basically saying, forget banning
Penn State. Just get rid of college football.

BARRO: What`s amazing about the NCAA is not only have they managed
to force the wages of their employees down to zero, they`ve managed to
convinced people that it would be moral to pay their own employees.

HAYES: Amy Goodman?

GOODMAN: The International AIDS Conference is beginning today in
Washington, D.C. Tens of thousands of people are gathering from around the
world. On Tuesday, a major march called We Can End AIDS. They are talking
about occupying the roots of HIV and people are calling for lifting of the
federal ban for syringe exchange, taxing Wall Street, the global 1 percent
to stop cuts to AIDS services worldwide, ensuring full access to
reproductive and AIDS services around the world, and demanding overall that
lives and health are prioritized over corporations and profits.

HAYES: Ms. Stacy?

ISHMAEL: Two things, you should know if you`re HIV positive, you
can`t get into the United States to go to that conference and, separately,
Washington state is going to announce voter registration via Facebook which
could have interesting effects on the Obama campaign, which has
historically use social media very, very effectively.

HAYES: Yes, we saw that story. I almost actually put it on my "you
should know". It got left on the cutting room floor.

Colonel Jack Jacobs?

JACOBS: Apropos, the last segment about Syria and the statements by
the Syrians notwithstanding about the unity of the revolution against
Assad, really, we should know there are really two wars taking place in
Syria right now. One is a sectarian fight and the other one is a fight
between the establishment, as hideous as it is and Islamic revolutionaries,
and what Syria is going to look like after that remains to be seen in the
United States.

It should be very, very weary about putting its foot into boiling
water. We have been burned before and I think we`ll be burned, again, if
we tried.

HAYES: Yes, the Syria situation, just the more you look at it, the
more complicated it seems.

I want to thank my guests today: Josh Barro from "Bloomberg View";
Amy Goodman from "Democracy Now"; Stacy-Marie Ishmael from the CUNY
Graduate School of Journalism; and Col. Jack Jacobs, MSNBC military analyst
-- thank you, all.

ISHMAEL: Thank you.

HAYES: Thank you for joining us.

A quick programming note: MSNBC will have special coverage of the
Colorado shooting this afternoon. Chris Jansing is anchoring live from
Aurora, Colorado, starting at 3:00 p.m. Eastern.

And our program will be on hiatus while MSNBC brings you our coverage
of the 2012 Olympic Games over the next few weeks. UP WITH CHRIS HAYES
will return on one day, Saturday, August 11th, our usual time, 8:00 a.m.
Eastern, and then resume our regular Saturday/Sunday schedule on Saturday,
August 18th.

Coming up next is "MELISSA HARRIS-PERRY". Joining Melissa this
morning to talk about the intersection of sports and politics, 1968 Olympic
medalist John Carlos. That is "MELISSA HARRIS-PERRY." I`m going to be
watching that, coming up.

We`ll see you, again, on August 11th. We`ll miss you here on UP.

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

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