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'Up with Steve Kornacki' Sunday, April 28th, 2013

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UP with STEVE KORNACKI
April 28, 2013

Guests: Jordan Fabian, Ryan Enos, Judy Pino, Lorella Praeli, Linda Garrou,
Rashad Robinson, Penda Hair, William Barber, Gerrick Brenner, Josh Barro,
Jesse Eisinger, Alexis Goldstein, Liz Kennedy

STEVE KORNACKI, MSNBC ANCHOR: Good morning from New York. I`m Steve
Kornacki. Rescue operations continue in Bangladesh where nine more
survivors have been pulled from the garment factory collapse that killed at
least 362 people there. And the U.S. terrorism official confirms to NBC
News that the mother of the alleged Boston marathon bombers was put on a
U.S. terrorism database in the fall of 2011. More on Boston in just a
moment. But right now, I`m joined by Jordan Fabian, he is the political
editor at "Fusion." Lorella Praeli, director of advocacy and policy for
United We Dream. Ryan Enos, a political scientist and assistant professor
of government at Harvard University and Judy Pino, communications director
for the conservative Hispanic group the Libre Initiative.

Two weeks ago, the immigration reform bill making its way through Congress
seemed virtually assured of passage, with the so called Gang of Eight
senators reaching a compromise and key Republican lawmakers lining up
behind the bill. Florida Senator Marco Rubio appeared on a record
shattering seven Sunday morning talk shows to make the conservative case
for immigration reform. And on the Monday after Rubio`s media blitz came
the Boston marathon bombings. The four days later, in the Senate Judiciary
Committee hearing Iowa Republican Senator Chuck Grassley began raising
questions about how potential weaknesses in U.S. immigration laws may have
enabled the attacks despite acknowledging that suspects immigration status
wasn`t even known yet.

(BEGIN VIDEO CLIP)

SEN. CHUCK GRASSLEY, (R ) IOWA: Given the events of this week, it`s
important for us to understand the gaps and loopholes in our immigration
system. While we don`t yet know the immigration status of people who have
terrorized the communities in Massachusetts when we find out it will help
shed light on the weaknesses of our system. How can individuals evade
authority and plan such attacks on our soil.

(END VIDEO CLIP)

KORNACKI: When the committee reconvened this past Monday Grassley and New
York Senator Chuck Schumer, one of the key advocates for immigration
reform, got into this heated exchange.

(BEGIN VIDEO CLIP)

SEN. CHUCK SCHUMER (D), NEW YORK: If you have ways to improve the bill,
offer an amendment when we start markup in May and let`s vote on it. I say
that particularly those who are pointing to what happened, the terrible
tragedy in Boston. as a -- I would say excuse for not doing a bill or
delaying it many months or years.

GRASSLEY: I`ve never said that!

SCHUMER: I didn`t say you did.

GRASSLEY: I never said that!

SCHUMER: I didn`t say you did, sir.

GRASSLEY: I didn`t say ...

SCHUMER: I didn`t say you did. I don`t blame you, Mr. Grassley.

(END VIDEO CLIP)

KORNACKI: Two days later Rubio himself suggested he was open to denying
student visas to immigrants from Muslim countries. A sentiment he stood by
the following day.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: You opened the door to perhaps not allowing Muslim
students to receive student visas in this country. Did you mean that 24
hours later?

SEN. MARCO RUBIO (R), FLORIDA: Well, first of all -- yeah.

If there are indicators that people are coming from parts of the world
where there are dangerous people living and plotting against us. That
should be a factor in determining whether we allow people to come here from
there or not.

(END VIDEO CLIP)

KORNACKI: So -- in this whole sort of immigration reform saga, this --
this version of it at least, because we have been down this road before,
you can remember a few years ago, and then ended up going nowhere. But in
this whole saga there have been a few, sort of, you know, moments where
everything just kind of stops. And then you think of maybe it was a month
or two ago when Marco Rubio, Chuck Schumer went on the Sunday shows and
basically said we are close to a deal, and Marco Rubio said wow, wow, wait.
Not even close, you know. There are some issues here. And it seemed like
what Marco Rubio was doing, there was just sort of making sure he had cover
on the right, and cover in the conservative base to go forward. We seem
maybe to have reached another one of those moments when the brakes are
being applied. Again, with conservatives saying, some of them, you know,
as we said with Chuck Grassley, and others, Rand Paul this week comes to
mind, you know, using the Boston bombings, you know, the Boston bombers
were in this country legally under the current immigration system. I`m
struggling to see any lessons from that - but did anybody here feel that
Boston should be affecting this debate?

JUDY PINO, THE LIBRE INITIATIVE: Well, you said that the Boston bombings
happened during the current immigration system. Obviously, it`s broken and
we need to take a second look at what`s in the current policy. And there`s
nothing wrong with taking a little bit of time, being a little bit more
careful to see where we went wrong, if there are any flaws that could have
led to this unfortunate circumstance. I`m not saying that the Boston
bombings, you know, have anything to do or should stifle immigration
reform. But - it`s a wakeup call. It`s definitely a wakeup call to say,
wait a minute. The status quo is not working. We are working on this
monster bill. Let`s make sure that everything is in it. You know, and
think if that`s going to work.

KORNACKI: And I guess the question and actually, Judy, you might be able
to speak to this, because the question here really with immigration reform
is what is happening within the conservative wing of the Republican Party,
because the last time six years ago when there was a push for comprehensive
reform it was conservatives who revolted and Republicans, you know, said we
can`t go forward with this. And some Democrats. You know, I wonder right
now, do you -- is your sense that anybody raising concerns about Boston
like Rand Paul this past week, is it -- is that a genuine concern on their
part or is this conservatives who want to stop this latching on to
something that they think they can use to stop something that looked
inevitable a week or two ago?

PINO: Look, I think this time around there is political will, whether
maybe there wasn`t as much back in 2004, in 2006. You know, I`ll tell you
what, I don`t think it is an excuse. I think that it`s a good opportunity
to double-check. You know, cross their t`s, dot our i`s. All we need is
280 (ph) votes in the House, seventy in the Senate, and I think we could do
it.

KORNACKI: No, it`s interesting to me. It does feel different this time
around. It certainly felt different, you know, three weeks ago. And I
guess if you look at the process that - that would have to play out here,
it`s going to, you know, the Senate, they already have the bill. It`s -
then they have (inaudible) committee hearings on it and there`s talk. I
think John McCain even said -- he expects or he wants to get 70 votes -- 70
votes or more in the Senate. And it speaks to this -- this sort of issue
that is -- bedeviled Washington this year where if you want to get anything
big through, you need a massive majority in the Senate, a massive
bipartisan majority in the Senate and you basically then the idea is, you
isolate House Republicans and you force them to bring something to the
floor that maybe the conservatives and the party don`t want. You know,
Jordan - I mean do you have a -- do you think that 70 votes -- the 70 votes
on the case, he is talking about , they actually materialize?

JORDAN FABIAN, POLITICAL EDITOR, FUSION: I think it could. It`s going to
be difficult for them to wrangle up the votes. But going back to the
earlier point about Boston, I really don`t think that this debate is going
to or this terror attack is going to derail this issue in any way, like it
did in 2001. You haven`t seen any fence sitters aside from Rand Paul really
go out there and say, well, Boston, I got to -- I got to put the brakes on
this. In fact, Mike Lee, after a committee hearing, said - and this an
opponent of the bill, said, look, this is just an excuse. We -- you know,
the issues with the immigration system existed before Boston and they`re
going to exist after Boston. So I think, you know, as the weeks go by,
this issue is going to go past and I do think they do have a chance to get
70 votes. It`s going to be tough, though.

LORELLA PRAELI, UNITED WE DREAM: I mean, I think that they are going to be
- a small number of people who are going to want to stand in the way
regardless. And we have seen this even before the Boston terrorist attack.
We saw how there were people who -- in committee, in the Judiciary
Committee, who are writing letters to Chairman Leahy saying we are going to
need, you know, the same time of -- the same amount of time that people
needed last time around. And that was three years of debate. You know.
100-plus committee or -- testimonies at committee hearings. I mean, so
there is going to be people who are going to want to stand in the way and
block immigration reform from going through. But I do think that our
coalition is stronger today than I think it was two weeks ago. I think we
have seen individuals from both sides -- both aisles of the political
landscape come out and say this is the reason why we need to work on
immigration reform. And it`s not a reason to derail it or to prolong it.

KORNACKI: But I guess -- you know, sometimes we are going to sort of
binary fashion, either we`re going to have immigration reform or not. But
there`s all sorts of variations of immigration reform and I think one of
the outstanding issues here, big outstanding issues, we have the Gang of
Eight compromise in the Senate. There`s a bipartisan gang that has not
released their plan on the House side. That there`s talk that that plan,
you know, the path to citizenship in the Senate bill right now stands at
about 13 years. The House is -- that -- hints coming out of the House,
five or more, 15 years there. You also have the chairman of the Judiciary
Committee on the House as a very conservative Republican -- Bob Goodlatte
from Virginia, who`s basically saying he wants to break this up into a
piece meal thing. And, of course, the concern there among advocates for a
comprehensive reform, is if you do that, if you break it up and you have a
separate vote on a path for citizenship. That makes it a lot easier and a
lot more likely that there will not be a path to citizenship, and so you
have this big split between the House and the Senate that`s going to be
reconciled still.

PRAELI: Yeah. I mean I would love to hear more from Congressman Goodlatte
about what the plan is to actually move through with the bill. He said he
wants to do it piece by piece, and he`s open to taking the comprehensive
bill, that the Gang of Eight and the House is working on and trying to
figure out how to -- you know, how to bring those together. But I don`t
think any Republican in the -- in the House wants to take five different
votes on immigration. And I think for us the concern is, if you start
breaking them up into a vote for stem, into a vote for (inaudible), what
does that mean about the 11 million undocumented people in this country?
I`m almost certain that there is going to be a desire to do a stand-alone
dream version, but I`m not so sure about, you know, when we start -- when
we start talking about a pathway to citizenship for my mom, and -- members
of our community.

KORNACKI: We -- that`s interesting -- an interesting distinction. Because
we have the Dream Act, which is, you know, there was a vote a couple of
years go, did not get through. If there`s a separate Dream Act, there`s a
separate Dream Act legislation right now, a separate Dream Act vote, and
then you have comprehensive reform, it seems like the track for the Dream
Act is going to be faster than the track for a comprehensive reform. Does
that raise any issues for families?

PRAELI: Yes. So, I mean, I think that the -- the Dream provision, the
Dream part of comprehensive immigration reform right now, has a different
pathway to citizenship. Much shorter. It`s a five-year pathway to
citizenship under the Gang of Eight and the Senate bill. I think that the
-- dreamers on the ground have made a commitment to our families and we
said last November 600 of us met in our national Congress and we said we
are on this fight for families, we want a pathway, a road map to
citizenship for 11 million people. We do not want a standalone Dream Act.
So, right now we are not even really considering about trying to push a
standalone Dream Act in the house or in the Senate.

RYAN ENOS, HARVARD UNIVERSITY: It`s important to remember why Republicans
got behind this in the first place. And that`s because - I mean, yeah, it
makes a lot of policy sense. But it makes a political sense, too. And
it`s just hard to imagine them wanting to break things up. Wanting to
knock and gain that same sort of political capital by, just being able to
move through a comprehensive bill where they can gain all these political
points with Latino s and other people that are behind immigration reform.

KORNACKI: Yeah. And well, it seem -- there`s -- two issues here. There`s
- there`s the broad problem that the Republican Party has with Latino
voters. There`s also this sort of tension within the Republican Party
where there are some very loud and very prominent voices who are saying
stop and they are not citing Boston. They are citing something else and we
are going to show you what that is after this.

(COMMERCIAL BREAK)

KORNACKI: So, Ryan was just talking about the political imperative for
Republicans to sort of get onboard with comprehensive immigration reform
and maybe help address the problems they`ve had the last few elections with
Latino voters. But there are some very prominent Republican voices who
are saying, don`t listen to people like Ryan. It is a trap.

(BEGIN VIDEO CLIP)

RUSH LIMBAUGH, RADIO TALK SHOW HOST: Let`s say you have 10 million
illegals. 7 million of them automatically are going to vote Democrat.
Republican Party is finished. It`s a mathematics. Conclusion -- I think
this is a disaster here for the Republicans to support amnesty. They are
signing their own death sentence.

(END VIDEO CLIP)

KORNACKI: So, there. Rush Limbaugh laid it out this typically nuanced
fashion. You have 11 million undocumented. If you make them citizens, we
can see the Latino s favorite Democrats -- 11 million votes for Democrats.
That`s it. Democrats win every election in the future. Is that right?

FABIAN: Absolutely not. I mean if we were to run through all the problems
of that argument we could spend all day here. But I will go with two.
First of all, all 11 million undocumented immigrants here in the U.S. are
not going to become full citizens. They are not all going to get legal
status and even among those who get legal status, not all of them are going
to want to spend the 13 years, you know, getting full citizenship. And
also, not all undocumented immigrants are Latino s. You have Asians,
Africans. I think, you know, at the end of the day, maybe, you know, at
the top of my head, you would be more than 2 million new Democratic voters.
I think Republicans should be more worried about the 50,000 U.S. born
Latino s who are automatically citizens, who turned 18 here every single
month. And those are going to be what`s driving the Latino voting bloc
into the next decade.

KORNACKI: Well, that`s -- so, Harry Enten who is a political numbers
cruncher, elections number cruncher, and he writes for "The Guardian," he
went through this step by step, the 11 million. He talked about what you
just said, Jordan, first of all, a fifth of the undocumented are not
Latino. Many of them are Asian, many of those Asians are concentrated in
California and Washington. So, when you are talking about the political
impact, that`s kind of concentrated. But he also cites that the last time
we had real immigration reform in 1986, we had Ronald Reagan, you had
amnesty. And you had over 3 million who were eligible for citizenship,
only 40 percent, 23 years later, only 40 percent had gone through that
process. If you apply that and you apply the fact that, you know, not
everybody votes, but half the people actually vote, he got down to about 3
-- 3.5 million in the year 2028. If you passed it right now this wouldn`t
affect anything until the year 2028. Which says to me, you know if there
are deeper problems with the Republican Party, it also potentially gives
them time between now and 2020 to address those problems.

FABIAN: And I believe it was actually Chuck Schumer who said at breakfast
I was at this week, that if the Republicans haven`t fixed the Latino
problem in 13 years, they have a much bigger problem on their hands.

KORNACKI: Right.

PINO: And let`s make it clear. Immigration is not the only thing that
matters to Latinos. There is education, there`s health care. There`s the
economy and jobs. So, let`s not focus oh, immigration is the only way to
get the Latino vote. And then even once they become eligible to become
citizens, the numbers show that a lot of them don`t even go through the
process of becoming citizens. Most of them when they come here, they want
to work. They want to prosper. And that`s why I think this bill is
important, because you have 11 million people living in the shadows, let`s
legalize them and let`s try to get them working, let`s try to get them
paying taxes. And I love the fact that you know, it addresses young people
like Lorella because they are the future of the workforce in this country.
It`s about the economy. You know, and -- if we don`t prep those kids, and
if we don`t indicate them to become viable citizens of this country, and
awesome contributors and -- you know, the future is, you know, not too
solid.

KORNACKI: Wait, you get to an interesting point there, though, when you
talk about this sort of broader attitudes that you finally poll Latinos
about. The role of government about the safety net, about their basic
attitude towards, you know, what government should be doing. It`s in
conflict right now with this sort of Tea polarization, you know, of the
Republican Party, which basically wants to - you know, reduce the safety
net, you know, pretty significantly. Reduce spending on all sorts of -- on
all sort of social programs. And it seems like -- I`m trying to figure out
what the Republican Party could do right now because if you really move to
where Latino voters are, you know, and other voters are, on those sort of
issues of the role of government, the Republican Party at the same time is
alienating what is right now. It`s base, which is sort of an aging, you
know, white population, more conservative white population that hostiles --
the very programs and the very ideas of the Republican Party you have to
embrace to get the new coalition. So, I don`t see how that`s resolved
right now.

ENOS: I mean there`s an important point on this, though. And, of course,
the Republicans might have to move away from being captured by the Tea
Party for other reasons. But a lot of the reasons Latinos are in favor of
sort of an expansive left wing government, is because they are low income,
like a lot of low income people in the United States they`re -- They are
Democrats. And -- as Latinos move up an economic ladder and as more of
them become citizens, it seems like this isn`t going to -- it`s not going
to stay that way. And they might move more naturally into the Republican
camp. Now, of course, they might have moved into the Tea Party part of the
Republican camp, so they might start moving in that direction. You have to
think about things like income and just general economics (ph), you think
about where they are, politically.

PINO: I think assimilation is tremendously important. When people
assimilate to this country and they realize that this is the land of
opportunity, for real. That there is an opportunity to study, there`s an
opportunity to open your business, to not depend on the government. That
the government sometimes, although with goods intention, gets in the way
who want to able to provide for our kids and we don`t want big taxes, big
regulation, getting in the middle of that. So, yes. You know. Maybe at
the beginning that`s why this process is going to take a while before they
are even eligible. Because assimilation is key to this. And being a
citizen is actually a privilege. So, that`s why I think, speaking the
language and learning about the culture is extremely important.

KORNACKI: Well, you raise the issue of assimilation and that actually gets
to a study that Ryan did, that looked at, you know, we tend to focus when
we talk about the impact, the political impact of comprehensive reform.
And Rush Limbaugh did and many others ( Ph) talking about well, you know,
can this be more votes for Democrats? There is a flip side potentially
that has to do a little bit with assimilation and we are going to ask Ryan
to explain that after this.

(COMMERCIAL BREAK)

KORNACKI: So, Ryan, you did a study that made me step back and say, wow,
maybe I have been missing a huge part of the story when it comes to the
political impact of having immigration reform. And it basically deals with
the issue of, is there going to be a backlash, sort of a tribal backlash,
among white voters, maybe even more liberal white voters who we never would
have thought would have any problem with it?

ENOS: Yeah. Yeah. So, we didn`t study it, because it`s sort of a long
history of this. And we all know examples about this, people like Reagan
Democrats, maybe one of the reasons people became Reagan voters was because
of a backlash against some sort of racial mixing inner cities and things
like that. This is a long history. We wanted to do an experiment on it.
The scientific experiment to see if we could show these things actually
happen. Whether places that are experiencing Latino immigration that
haven`t experienced before by having backlash against their Democratic
voting. So, in Boston, in Massachusetts, which is a good blue state.
Whether or not the blue state might start looking more right. We did it --
we did a scientific experiment, just like you might see if you are trying
to show that the drug did something. We have treatment and we had a
control. And our treatment was introducing immigrants, people that were
supposed to be immigrants into these communities in the Boston area. For
an extended period of time.

KORNACKI: And these are communities that are sort of affluent, liberal ..
.
ENOS: Yeah, so the one thing -- yeah, Newton, Newton and place like
(inaudible) -- they`re relatively affluent like the Boston suburbs are.
And they are very - they are very, you know, liberal sort of blue places
are homogeneously white. And so, we are essentially looking at white
people that are in these - that are in these communities. That haven`t
experienced Latinos moving into their communities. And we look at their
attitudes about things like immigration. And this is a very small number
of Latinos. As a matter of fact, it was two. So we sent two Latinos to
train stations, actually, so people be exposed to them every day. And -
and then we looked and say, with their attitudes about things like
immigration, look like after there, exposed to these people -- for only a
few days. And what you saw was, at the (inaudible) things like well,
children of undocumented immigrants should be sent back to Mexico and they
said, we should reduce immigration from Mexico and they said that English
should be made a national language. And all those things moved in a
significant direction away from these sort of liberal immigration values
compared to a controlled group.

KORNACKI: You see, that`s something that frustrates me. Because
obviously, assimilation, you know, is the ideal and we like to think that,
you know, we - we certainly hope that that`s the direction of moving. You
know, but when I hear that story I think of what happened in the south.
And especially in the deep south in the last 40 or 50 years. After civil
rights. And, of course, you know, pre-civil rights, the Democratic Party
dominated the south. It was a really one-party region. Roosevelt got like
90 percent of the vote in South Carolina like in 1936. Things like that.
What happened when you had civil rights, blacks suddenly -- voting rights,
blacks suddenly able to vote and they -- they largely became Democrats.
Whites fled the Democratic Party in the south. And it has gotten to the
point in the last election, you know, Romney was getting like 90 percent of
the white voters in a state like Mississippi. And you basically have two
parties that are just broken along racial lines. And when I hear about a
study like that, I just, you know, you know, makes me a little nervous.

PINO: Well, but you know, that`s why -- if you take it -- it`s the sign of
the times, right? What`s happening right now. Look at the blowback that
our Representative Don Young received when he managed to say, you know, the
wetbacks ...

KORNACKI: Right.

PINO: ... you know, that wetbacks comment. It was not pretty for him.
And even from the - from the Republican side, they were not happy because
that does not make the party look good at all. And so what`s happening is
that this legislation is on the table right now. It makes everybody just
uncomfortable enough to work. Because -- it addresses the unions, it
addresses the, you know the kids of these undocumented workers. The
employers. A border security. So, it addresses all the things that might
make people, you know, think twice about saying your name to this bill.
And that includes, you know, the China Sea. You know, if there is an
opportunity for a job for Americans, Americans should be considered first.
They have 30 days. Because the employer has 30 days to post the job. So
there are things in there that some people might say, OK, I could deal with
this.

KORNACKI: Yeah. I know. A lot of the -- lot of the -- some of the things
that sort of sink the last effort in 2007, and a part of it was just
basically a rebellion against the idea of amnesty and conservative base.

PINO: OK.

KORNACKI: But it was also the unions and the Chamber of Commerce who sort
of at loggerheads. That has been resolved. So, so again -- and there`s
more of -- there`s more of an incentive, you know, for the Republican
Party. I guess this was -- this was sort of an issue when they - Lorella
(ph) that self-autopsy a month or two ago. People probably forgotten all
about. But the Republican Party tried to diagnose its problems.

PRAELI: Like you see the GOP growth and opportunity project and, you know,
it outlines this is what your party -- this is what the party needs to do
to be relevant and be competitive in national elections. And in there you
see they have to find out how to appeal to Latino voters and they have to
resolve immigration reform, right? And so there -- the Republicans are in
this moment right now where they can be on the right side of history or
they can choose not to. And there will be people holding them accountable.
You know, one of the things I really love to talk about is like dreamers
are such - they are political force. Right? Like we`ve organized, we have
-- made political demands and one political -- like we have political wins
without our ability to vote at this moment. But we`ve not declared an
allegiance to either the Democrats or the Republicans. We hold Senator
Rubio just as accountable as we hold the president of the United States.
And so -- how people act and how people -- how they come to the table on
this issue of comprehensive immigration reform, which obviously is -- is of
utmost importance to us, that will matter and it will have long lasting
implications for us.

KORNACKI: So, this is sort of - yeah, so we were talking during the break,
you know, and Ryan was saying that the political science on this is the
voting preferences party, you know, identity gets locked in basically,
whether on college of 2021. Whatever it is. And so, right. -- your
point, I think is well taken. If one party is seen as hostile to the
dreamers right now and the other one obviously seen as sort of advancing
their cause that might be - that might lock in preferences that are going
to be affecting, you know, elections.

PRAELI: And I think we are in a moment where it`s more than just dreamers,
right? Because both Republicans and Democrats, when they talk about
dreamers right now. They are kind of on the same page. Dreamers should
have a pathway to citizenship. Dreamers, you know, we -- we are all kind
of -- we are very politically popular for both parties at this moment. But
I think what dreamers are looking out for at this moment is how are you
talking about my mom? How are you talking about my dad? How are you
talking about my neighbor? And that`s -- that makes the key difference for
us.

FABIAN: And guess what ....

KORNACKI: We will pick that thought up right after this.

(COMMERCIAL BREAK)

KORNACKI: Jordan, I rudely interrupted you. What were you about to say?

FABIAN: Well, I just think that overall sort of takeaway of this whole
argument is that -- the Republicans certainly need to start doing the work
now and starting with immigration reform to - sort of tap into this growing
Latino voting block. But in the short term there`s some really tough
consequences for them. They can risk backlash from this white working
class voters who moved over to them with Ronald Reagan. So I think that
just -- that`s what makes it so tough for the party to wrap their minds
around this at the moment.

PINO: At the same time there were a lot of white voters that voted for
Obama this time around. Latinos, maybe next time around, are not - are not
going to be that happy with the Democratic Party. They haven`t been that
party with the Obama administration at all. So, it`s kind of - it`s kind
of - patronizing to say, oh, Latinos are automatically going to vote one
way or another. These guys need to earn people`s votes. Both the
Democrats and the Republicans. And that takes a lot of effort being on the
ground and doing your homework. And -- showing the party, you know,
showing the people that, you know, you care. And I think that has been --
definitely been a challenge for the conservative party, for the Republican
Party and so there is a lot of homework to be done. Especially in the
Latino community.

ENOS: Democrats get angry when I say this. But I`ve (inaudible) there`s
an inevitable march of Democrats to victory, it is somewhat foolish.
Because we have seen this before. And we`re talking about this in the
break. As people thought this coalition that Roosevelt put together in the
`30s would never break apart.

KORNACKI: Right.

ENOS: And it did. It broke apart in the 1960s, due to issues like civil
rights and losing white voters.. And Democrats do need to think about how
they can keep all these voters together in one coalition. And I personally
think a lot of their policies stay for that. That they can keep them
together, but it`s not an easy thing to do.

KORNACKI: No, their cycles are red. I mean I grew up when it was the
Republicans who had a supposed lock on the electoral college from 1968 to
1988. You know, basically Nixon to Bush senior. And I`m hearing about
it`s the coalition of the (inaudible) for the Democrats. And I can
certainly see the argument that this is going - this could be a decade long
thing. That could even be more than a decade. But yeah, at a certain
point, it`s hard for me to see that one party is permanently going to have
a demographic advantage and the other party won`t eventually, you know,
eventually adjust. But it`s interesting. We, you know. President Obama
actually made a point this week that I think is worth bringing up. There
were a lot of talk this week about George W. Bush`s legacy because of the
opening of his library and obviously, there is a lot in that legacy that --
you know, controversial or maybe even disastrous, but there is something
that he was a little bit ahead of his time on, at least within his party
and -- President Obama did -- you know, talked about it this weekend. I do
want to show that.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: And seven years
ago President Bush restarted an important conversation by speaking with the
American people about our history as a nation of laws and a nation of
immigrants. And even though comprehensive immigration reform has taken
little longer than any of us expected, I am hopeful that this year with the
help of Speaker Boehner and some of the senators and members of Congress
who are here today, that we bring it home. For our families and our
economy and our security. And for this incredible country that we love and
if we do that, it will be -- in large part thanks to the hard work of
President George W. Bush.

(END VIDEO CLIP)

KORNACKI: So I -- look. At this passes -- I don`t know how much credit
Bush deserves. But, you know, I think it`s worth noting he sort of -- he
spotted this and then Karl Rove spotted this a while ago.

PINO: That`s right.

KORNACKI: A while ago. That the Republican Party`s future was tied to
sort of making - you know, winning over Latino voters. And you know, you
look at the 2004 election, it seems like an eternity ago maybe. George W.
Bush got 44 percent of the Latino vote then. Which is - it`s staggering
when you look at what McCain did and we look at what Romney did. It was
only eight years ago, nine years ago that, you know, that Republicans --
nearly 50 percent--

FABIAN: Yeah, I think -- you know, Bush got all of the things that Judy
was pointing out, that you need this sustained outreach. And he was from
Texas. He dealt with the Hispanic community during his time as governor.
So, he got all of this whereas, I think, you know, someone like Mitt
Romney, just - it didn`t come naturally to him. You know, Bush was on the
immigration issue all the way back in 2001. I mean he was talking with
(inaudible) -- binational migration working group. And that all got
derailed by 911

KORNACKI: The first - The first, I think state dinner at the White House,
when Bush was president was with Vicente Fox ...

ENOS: That`s right.

KORNACKI: ... who was the Mexican president.

FABIAN: So, he was on this a long, long time ago. Like over ten years
ago. And it`s kind of amazing now that we ended up, you know, where we are
right now.

KORNACKI: And his whole party, really, you know, his party was what killed
this in 2006 and it does make me wonder if the conservative movement hadn`t
revolted, if the sort of nativist wing of the Republican Party hadn`t
revolted, if politics, you know, landscape might look a little different
today.

ENOS: How much of the whole problem was Reagan? Right? He was the last -
- he was Republican president that ushered an immigration reform. And it`s
like, you know, we`ve been talking about it. That these Latinos didn`t
come on board with the Republican Party in large numbers. So, because --
it is more than just immigration. And people said that. It`s more than
just immigration that`s doing this. And the Republican Party needs to
think beyond just immigration if they want to bring Latinos onboard.

KORNACKI: All right. I want to thank Jordan Fabian of "Fusion", Lorella
Praeli from the immigration group "United We Dream", Ryan Enos of Harvard
University and Judy Pino of the Libre Initiative.

What would America look like if Republicans had complete control of
government? That`s next.

(COMMERCIAL BREAK)

KORNACKI: If you wonder what American politics might look like if
Republicans had managed to win both the White House and Congress last fall,
then all you really need to do is look at North Carolina. On Monday, the
state senate there voted to make parents and families seeking welfare
benefits take a drug test first. The test would cost applicants $100 up
front, money that would later be funded for those who pass. Two days after
that, the state house of representatives passed a bill requiring voters to
show photo identification at the polls. This as protesters made their
feelings known at the state capitol just as they have when other states
have mounted attempts at voter suppression. Both bills are expected to
pass when they reach the other House. What makes North Carolina worth
paying close attention to right now, is the fact that the state has
suddenly just in the last few months become a laboratory for Tea Party
ideology. Like every other southern state, North Carolina used to be
solidly Democratic, it`s a long time ago. But unlike other southern
states, it has not quite made the transition to Republican red. So, it was
an historic moment in 2010 when North Carolina Republicans won control of
both Houses of the state legislature. The first time since 1870. Those
majorities couldn`t do too much because the state still had a Democratic
governor. That was until last November when voters handed the governorship
to a Republican giving the party total control of North Carolina`s
government for the first time since reconstruction.

Unleashed and unchecked, they steamed forward on an agenda that could pass
for a Tea Partiers wish list. Personal and corporate tax cuts,
restrictions on abortion, cuts to education funding, increasing out of
state tuition for state schools, ending public funding of judicial
elections and potential rollbacks of the local environmental regulations.
The state has already blocked the expansion of Medicaid under President
Obama`s health care reform law. I want to bring in Gerrick Brenner, he is
the executive director of Progress North Carolina. Penda Hair, co-director
of the civil rights group, the Advancement Project, former North Carolina
State Senator Linda Garrou, and Rashad Robinson, he is the executive
director at the black advocacy group "Color of Change."

So, I just set this up and sort of -- this is what your world would look
like, America if Mitt Romney had won and Republicans have taken the Senate
last year. And I think what makes this particularly interesting is like we
said in the opening, you had a situation in North Carolina before this year
that was similar to Washington. Where Republicans had legislative control
and you had a Democratic executive in, you know, in North Carolina. The
governor nationally President Obama who could put the brakes on their sort
of wildest ambitions, but you removed that break in 2012 with the election
of a Republican governor. And it is a Republican governor who his name is
Pat McCrory. When he was running nationally he got a lot of attention for
being a -- supposedly moderate and pragmatic Republican, kind of like Mitt
Romney. As governor, though, totally different story it seems like.

FMR. STATE SEN. LINDA GARROU (D) NORTH CAROLINA: You are absolutely right.
The governor is being controlled by a businessman in North Carolina and
what we find with the Republican reign of terror is a contempt for the
middle and contempt for people who need a handout and a hand-up and a leg
up on -- to achieve opportunities for them. The interesting part about
what the Republicans are doing it, they are not only doing these things at
the personal level, they`re also looking at our economic engines and going
after our university system, which is the pride of North Carolina. Most
states would love to have a wonderful university system like North
Carolina. And then they are going after our cities. Our economic engines.
Where -- where the jobs are being created. So, it`s a really disappointing
turn of events for those of us who`ve worked so hard to provide
opportunities in North Carolina.

KORNACKI: And in the end, so the expectation is -- you know, we had the
voter I.D. bill clearing one chamber, we had this welfare bill clearing
another chamber. And the expectation is these are both going to clear both
houses and be enacted. Is there anything at this point that you could see
stopping that?

RASHAD ROBINSON, COLOR OF CHANGE: I mean, the few things that can stop
that is ongoing national attention and ongoing media attention. Shows like
this. And the work of the local folks on the ground. But this really
speaks to not just what`s happened politically in North Carolina, and also
speaks to the type of funding that`s happened on the ground of the network
of state groups by folks like Art Pope. The businessman behind all the
dollar stores in North Carolina.

KORNACKI: Yeah. Talk to me a little bit about Art Pope. This is an
interesting story. "The New Yorker" did a write-up on him a couple of
years ago. So, he`s sort of the -- runs the - the chain of like wholesale
stores in North Carolina. Lots of money. And he went in in 2010, the
legislative elections when Republicans won control and basically they - how
did -- he just poured money into the state senate races.

ROBINSON: He poured money not only to the state senate races, but into a
network of local organizations, right? In many cases, there`s a lot of
national groups now coming in and trying to help and support the amazing
work that ProgressNow and others are doing. But what they did at a local
level was funded an array of think tanks and local groups and advocacy
groups on the ground and nationally to really remake North Carolina. And
he`s -- basically, funded and funded the takeover of this House and in so
many ways operating it like -- kind of an old school big plantation where -
- these legislators really have to do his bidding and in the state house.

KORNACKI: And Art Pope now has a position in -- the governor`s office is
that right?

PENDA HAIR, ADVANCEMENT PROJECT: That`s correct. I believe he is the
budget director. It is really ironic that you buy the election and then
you become the person who governs. I guess one of the things that I wanted
to say is that one of the most terrifying aspects of this is that -- the --
folks who have taken control, are now trying to rig the rules so that they
can stay in control, pass the time when they have a majority. And -- as
you said North Carolina is -- has been a moderate southern state.

KORNACKI: When you say that, what specifically is being done to do that?

HAIR: There is two things. One is the voter I.D. law and the other taking
the proposals that having it passed or probably will pass cutting back
early voting, taxing the parents of students who voted, their colleges,
which is admittedly in order to put states in play on a partisan basis and
the -- eliminating Sunday voting, which is -- used disproportionally by
African-Americans. And then the other piece of it is redistricting. The -
- the state votes pretty much evenly, Democrat, Republican, as you said
President Obama won it and not from a partisan standpoint, but from an
analytic standpoint it is tilted. It is tilted so that -- of the 13
Republicans -- of the 13 congressional districts, nine of them are held by
Republicans. And these -- and the Republicans have a super-majority in the
legislature. And that`s because they drew the lines in such a way as to
really maximize their control of the state for the next ten years. Unless
the -- the lawsuit which is about -- brought by the southern coalition
should be successful and should redistrict the state.

KORNACKI: Right. And the redistricting was done in -- when you still have
a Democratic governor, but she had no actual role in the process, so she
couldn`t be a check there. I want to talk more specifically about the
voter I.D. issue, which is -- hot right now. That`s right after this.

(COMMERCIAL BREAK)

KORNACKI: Right now, I want to bring in Reverend William Barber. He is
coming to us from Raleigh, and he is the president of the North Carolina
NAACP, and a major figure in those protests Wednesday at the state
legislature. Reverend, thanks for joining us. So -- I wanted to just ...

REV. WILLIAM BARBER, PRES., NORTH CAROLINA NAACP: Thank you, Steve...

KORNACKI: ... first establish we have the -- in all of the likelihood
right now, the voter I.D. bill is going to be passed by the other chamber
and signed by the governor. This has happened in other states and there
are, you know, various restrictions on voting in each of these bills. Can
you just outline what exactly are the restrictions on voting that are in
this bill?

BARBER: Well good morning, Steven, thank you so much. You know, when you
really look at this, however -- there`s a context you have to put in. What
we are seeing in North Carolina is a -- extreme ideological mean-spirited
Tea Party backed attack on people in this state. It is almost as though
they want to be known as the George Wallaces of the 21st century. It is
kind of like the white southern strategy being revisited with the 21st
century twist. They started out at the beginning of the legislative --
they cut 500,000 people from Medicaid, for (inaudible), health care. They
decided not to take it. 165,000 people that cut out of unemployment. And
now they are attacking voting rights. They`ve also decided that they want
to go after labor rights, they want to -- put impediments in the
Constitution for labor rights. They cut 900,000 working people`s earned
income taxes, effectively raising taxes on the poor. So they could give a
tax cut to 23 wealthy families. Now, they are going after voting rights.
And the voter I.D that they have passed in the House is more restrictive
than South Carolina and Alabama. They will not allow people with
impediments to still be able to vote as South Carolina does. They have
denied private school I.D.s as a form of I.D. in this state.

So schools like (inaudible) or Wake Forest or Duke University students or
Shaw students, would be denied. It`s 89,000 private school students in
this state. Is voter suppression -- is -- poll tax disguised as voter I.D?
The same legislature, Steve, last year, the most race based redistricting
plan that we have seen since the 19th century and they are planning to roll
back same-day registration, they`re planning to cut Sunday voting. They
are saying that if you are a felon and you paid your debt to society you
have to wait five years and then -- after that, you have to apply to the
local or -- election board to get your rights back. So, we are seeing an
extreme attack of race based, class based attack because this crowd is
afraid of a brand-new electorate. It`s happening in the south, this tale
(ph) of the solid South is coming apart, the demographics are saying that
and they are afraid of this new electorate, this new America. They know
they can`t win with the broad electorate. So, now what they are trying to
do is create structures of public policies that were hurt minorities and
African-Americans and the poor. And they are trying to put impediments in
the way of a broad electorate who are not allowed it to stand.

KORNACKI: Well, yeah. So, you say we are not allowing it. I have seen
reports that you are maybe planning some sort of civil disobedience
campaign. Maybe, you know, this coming weak. Can you tell us if you have
anything planned there?

BARBER: Well, we -- we have a two-pronged strategy. You know, when the
deal with this kind of right-wing southern strategy, you have to have a
ground-up approach. So, we have great groups like the Southern Coalition
leading our legal piece. And now we have Advancement Project. You have
Anita Earls with Southern at Penda Hair and Judith Browne with Advancement.
And we are putting together powerful legal strategy, because we believe all
of this is unconstitutional, both at the state constitutional level and at
federal. But you also have to have with a legal strategy -- a strong
grassroots movement. Look, we have an organization in the NAACP, 100
branches, we have 147 members of our coalition called the People`s
Coalition. And we are tonight meeting at the United Church of Christ
Pilgrim -- the United Church of Christ in Durham to call this state to
prayer, to protest and to nonviolent civil disobedience. And tomorrow,
between the hours of 3:00 and 6:00 that we will be in action of clergy and
students who will engage in a form of pray-in, a protest. We will not
allow them to do this in the dark. We will not allow them to do this
without the whole world and the whole country seeing what they are doing.
And -- saying to our friends from around the country, if you really want to
change the nation, you`ve got to change the south. If you can help us on
the ground, help us, because we are raising -- this is - we drawn a line in
the sand. They have crossed the moral line and crossed a constitutional
line and we are going to continue to protest both in the streets and in the
courts. Because what happens in these southern states has the dramatic
impact on what happens in the nation.

KORNACKI: Reverend, very quickly, because we are going to be up against a
break here, but if this bill ends up being, you know, implemented any way,
signed by the governor, are you prepared for a legal challenge?

BARBER: Definitely, definitely. That is what -- I set a two-prong
strategy. It will be up a legal strategy and we have an organizing
strategy. We believe that this bill that they have passed violates section
one of North Carolina Constitution, section 6 of the Constitution that says
the legislature can`t even do what they are doing in terms of determining
who can vote. We believe that it violates the 24th amendment and creates a
poll tax. We believes it`s fundamentally against the 15th Amendment of the
Constitution. Really, Steve, finally, we have to understand what`s going
on. I think that the broad electorate that brought President Obama into
office and even in 2008, gave him North Carolina, scares everything out of
people who want a homogeneous electorate, they know we are in the middle of
a kind of a third reconstruction, they see fusion politics, blacks and
whites. And labor and faith and young people coming together. LGBT like
never before. They know they can`t win in that context. So they want to
rig the election. But we are not going to allow it. We`re going to fight
it with everything we have from the ground up. Change North Carolina and
change the south. And we are going to change the nation.

KORNACKI: All right. Reverend William Barber of the North Carolina NAACP.
Thank you for joining us. I want to find out how North Carolina became a
Republican hegemony after this.

(COMMERCIAL BREAK)

KORNACKI: Hello from New York. I`m Steve Kornacki here with Gerrick
Brenner of Progress of North Carolina, Penda Hair of the investment
project, former Democratic North Carolina State Senator Linda Garrou and
Rashad Robinson of "Color of Change." You know, so we`ve been talking --
we just got a pretty good run-down from Reverend Barber about, you know,
what exactly is objectionable about, you know, voter I.D. and all of the
other sort of attempts to sort of mess with the election system in North
Carolina.

I guess whatever we have these issues come up, whether it`s in North
Carolina or nationally, the thing that I - the thing that I try to keep in
mind is when you -- when you look at public opinion on this, sort of mass
public opinion on the issue of voter I.D., reflexively I think, most people
look at it and just say well, I`ve got to, you know, get an I.D. for this,
I`ve got to get an I.D., -- you know I got to be showing my I.D. al the
time. Why shouldn`t I- you have to show it at the polling place? And it
seems like, you know, you kind of come up against that and -- it kind of
encourages this.

GARROU: Well, certainly that`s an issue for folks. And my statement to
folks who`ve asked me about that is -- set up a way for seniors and set up
a way for poor people, go to the churches and set up I.D.s if that`s what
you end up doing. So that -- that it is not a hardship on people to -- to
-- to be able to secure those things. But the issue with an I.D. is that -
- we have a right to vote. That`s our constitutional right.

ROBINSON: But then and the I.D. issue is really - it`s a solution in
search of a problem.

GARROU: Absolutely.

ROBINSON: We actually don`t have a problem in this country with in-person
voter (ph) We`re actually more likely to see big foot and maybe we might
see the state legislature down in North Carolina talking about big foot
next. Just looking at some of the other legislation.

GARROU: Absolutely.

ROBINSON: But it`s not really a problem in this country. What we have a
problem with, is long lines. We have a problem with some communities
having good voting systems and good machines and others not. We have a
structural problem in our system that is not about I.D.s, and I.D.s are not
going to solve this, especially narrowly tailoring what type of I.D.s,
where you can use a gun license in some places.

UNIDENTIFIED MALE: Right.

ROBINSON: In some place, and it is not ...

(CROSSTALK)

KORNACKI: Here`s -- there is a -- there is an amazing stat. Somebody said
there were 18 million ballots cast in North Carolina from 2000 to 2011.
And of the 18 million there were 22 cases of fraud.

GERRICK BRENNER, PROGRESS NC: Well, Steve, the right wing is funding
groups with names like the Voter Integrity Project. They`re going into
legislative hearings on voter I.D. They are having people come up to the
microphone and accuse people, naming voters, by name, and what county they
are from, accusing them of voter fraud. But then when you go back and
actually talk to the voters, you find out that wait, they actually voted
legally. Two days after this legislative hearing, the same group, Voter
Integrity Project put up a Web site statement Friday - on 4:55 on a Friday
afternoon, saying they made mistakes. They are promising an audit, they`re
promising a report. Here we are weeks later. No audit. no report. But we
have voter I.D. passed the state house.

KORNACKI: Well, and so -- so, I mentioned the -- when you -- sort of poll
mass opinion, it`s again -- t is reflexive. We will sure, you know -- we
need a - kind of a wondered watching this play out over the last few years
if the response from the left, you know, sort of practically speaking, you
know, I can understand statistically it is not a problem. But practically
speaking, it is -- the response wrong and should the response maybe be
more, you know, let`s have some sort of I.D. But let`s put the burden
entirely on the state to provide the I.D. to individuals.

So right now all of these I.D. laws, they put the burden on the individual,
is there a way maybe to have some sort of state issued I.D? Where the
burdens entirely on the state to do it? Is that -- should that maybe be
something the left is thinking about?

HAIR: Well, let me just say, Steve, that this is not really about I.D.
This is about a narrow restrictive form of I.D. that has been precisely
crafted to exclude students, seniors and people of color. And even
veterans. And approximately 600,000 people in North Carolina don`t have
it. So even though many people can say, yes, I have to show an I.D. for
this or that, it is a -- a right to vote. And so -- we believe that the
system is -- working just fine the way that it is. And when people find
out, like there was a recent league of women voters poll in North Carolina
that asked voters if you knew that this was being done to manipulate the
system so that the same politicians could stay in office, then they are
opposed to it. If you knew that there was no problem with voter fraud, and
that this was just to stop voting, would you be opposed to it? And they
are opposed to it. And so -- if you -- it depends on how you ask the
question and what information you provide, and when people find out what`s
really going on, they are not in favor of this form of narrow I.D.

KORNACKI: Yeah.

BRENNER: Steve, people are fixated right now on voter I.D. because it`s
the issue that the right has been pounding in North Carolina for the last
two years. But previous governor vetoed the voter I.D. bill. But if you
look at the full spectrum of what they have planned, to make it harder for
voters to vote, it just reveals what their motives are. I mean they want
to cut early voting back from 17 days down to six days. Early voting is
extremely popular. More than half the people who voted in the presidential
election in North Carolina, they voted before election day. They voted
early. Like Reverend Barber said getting rid of the same-day registration,
97,000 people voted the same-day registration. They want to eliminate
voting on Sundays. Why do they want to do that? Why Sundays? Well,
African-American churches have a -- tradition of souls to the polls
program. The attack on student voting is outrageous. There is even a bill
to tell students they have to go vote where their parents live, even though
they have been living on campus what -- since their freshman year. They
can`t get around that legally. So what they do is they try to impose a
poll tax on the parents saying that the parents can`t claim the student as
a dependent on their tax returns. Costing the parents $2,500. That`s a
poll tax.

GARROU: You know ...

KORNACKI: Go ahead.

GARROU: You know, and this is in for us who are working nationally, it`s
so important. And for people all around the country, who are saying I
don`t live in North Carolina. Why should I care about this? This is going
to be the response all around the country to that rising American
electorate that Reverend Barber talked about. The coalition of black
folks, Latino, young people, women, gay folks, who all came together and
turned out and elected and re-elected Obama. And when you see the numbers
from this, you know, coming out in the spring, of -- who turned out, you
are going to see once again a real uptick in black voting. You are going
to see that -- black -- young people under 30 led their white Latino and
Asian counterparts. Not only in this election, but in 2010 as well. And
this is going to be the responses. Their response throughout history,
every time the new folks come into our political process, barriers are put
up to stop their participation and we have to be vigil in North Carolina
because this is going to be part of the strategy all around the country.

KORNACKI: Well, that is an interesting point. Because that was sort of
the talk nationally last fall, it was about we had all these states that
were advancing voter I.D. laws and was this going to sort of suppress the
Obama coalition. Now, some of them were stopped before election day by the
courts. Some of them, you know, were never able (inaudible). So, if you
look at the returns from 2012, there is not too much evidence that it
actually suppresses votes. And you could actually say in the context of
2012 it helped the Democrats, because of like you say it motivated people
in a way they wouldn`t be motivated before. But I guess the test is going
to come in a state like Pennsylvania where - when these things actually go
into effect in North Carolina if this goes into effect, it raises all sorts
of other issues. But there are -- as we say the voter I.D. is just one of
a number of issues where there is sort of a Tea Partization of North
Carolina going on. I want to talk about, you know, how Democrats are
responding to that and if there are lessons from North Carolina that can
sort of applied nationally. And that`s after this.

KORNACKI: So, like we`re saying, North Carolina really sets up in terms of
how government is sort of structured right now. It is the nightmare for
Democrats anywhere in the country. It`s their -- completely opposition
party. The -- Republican Party controls the legislature, Republican Party
controls the executive branch and the Republican Party itself is sort of
controlled by this -- sort of Tea Party movement forces that have just --
sort of forced - and it`s a flood of far right legislation. You know, on
to the scene, into the legislature and in many cases into law. And I
wonder if there are sort of -- you know, if you are the opposition in this
situation like that, and you don`t actually have formal power in the
legislative or executive branch, or you control anything, how do you fight
it? How do you fight it for the next four years of Pat McCrory`s
governorship?

GARROU: You work hard to make sure that people realize and it hadn`t taken
them much, speaker Tillis has allowed all kinds of absurd legislation to
come to the floor. That`s made North Carolina the laughingstock of the
nation. Folks all over the United States laugh about some of the bills
that ...

KORNACKI: Like, what are some of the bills ...

GARROU: Well, for example, the nipple bill, that if women uncover their
nipples, that they will be sent to jail. That`s a really important issue
when you have to watch that carefully. The state religion bill. Other
kind of bills that ...

KORNACKI: And what would the state religion bill be?

GARROU: The state religion bill would have - actually go against the North
Carolina Constitution, the United States Constitution and declare that
North Carolina have their own religion. I vote for Presbyterian.

(LAUGHTER)

GARROU: So, it`s -- I mean, all of these things are just totally
ridiculous. We have pat McCrory, our governor. He ran the city of
Charlotte and worked very closely with Democratic leadership in Mecklenburg
County and in Raleigh, because we realized, again, that cities are the
economic engines of our states and we`ve got to keep those things strong
beneath our -- people employed and that`s how he got so much done. So, now
he gets to Raleigh, he is totally controlled by the Tea Party group and Art
Pope and Speaker Tillis has done nothing to stand up. And again, his (ph)
made north Carolina a laughingstock.

KORNACKI: That`s interesting. You`re talking about -- so the speaker of
the House of Representatives -- you are saying is basically facing the same
situation as John Boehner is facing nationally where John Boehner has the
title of speaker, but in terms of having actual power to control his party,
you know, he seems to maybe get two or three bills a year. If he can bring
up to the floor without his party, without his party revolting.

BRENNER: He may not be a card carrying member of the Tea Party. That
there is a lot of Tea Party momentum in that Republican Party controlling
the legislature and he has a hard time controlling it at times. You know,
one issue that will resonates with North Carolina voters is public
education. North Carolinians have a tradition of supporting public
education and the governor and the legislature are repeatedly sending up
signs that they don`t support public education. The governor says things
like -- questions the need for liberal arts education, we`ve got a state
senator suggested we eliminate two UNC campuses while the state`s
population continues to grow. And revenues are starting to come up a
little bit. North Carolina now ranked 48th in the nation per people
funding. Ranked 46th in teacher pay. There`s proposals to bring in
vouchers, extremely unpopular with North Carolinians. There`s a proposal
to blow out the limits on class sizes. That is extremely unpopular with
North Carolinians. And the list goes on. I mean, they really are trying
to privatize public education. It is going to be a problem for them.

ROBINSON: And you know, these legislators have no reason to listen to the
folks that we represent, right? And so at the end of the day there are
corporations, there are business folks behind these politicians. The Art
Pope who is -- who essentially really in black and brown communities
selling his products every single day and then -- you know, taking that
money and going to, you know, push legislation and legislators that put our
communities in harm`s way. And so that at the end of the day this may not
be a strategy of simply going after legislators, but also going after the
corporations and the business leaders behind these politicians, the folks
that have given them the voice and the ability to pass all these horrible
pieces of legislation that impacts the very folks that these business
leaders need.

KORNACKI: Corporate money in politics, secret dark money in politics. You
have just perfectly set up where we are going in a minute. I want to thank
Gerrick Brenner of Progress, North Carolina, Penda Hair of the Advancement
Project, former Democratic North Carolina State Senator Linda Garrou and
Rashad Robinson, executive director of "Color of Change" and a Segway
professional.

A rare chance to make corporations disclosure a secret political spending.
That`s next.

(COMMERCIAL BREAK)

KORNACKI: If there`s one thing we learned from the 2012 election, it`s
that the already gigantic role that money plays in politics is only
expanding. The amount spent in presidential and midterm elections has
surged from $1.6 billion in 1998, just 15 years ago to more than $6 billion
in last year`s presidential Senate and House contests. Now, money does not
always equal results. You can just ask Karl Rove about that. His group
American Crossroads spent over $100 million in last year`s elections. But
according to the Sunlight Foundation, just 1.29 percent of that money
actually went to winning campaigns. Regardless of the results, though, big
money does absolutely set the terms of debate in Washington. And there is
a particular breed of outside spending that has an especially perverse
effect on democracy. Secret undisclosed spending, or so-called dark money.
Money that funds groups like Rove`s Crossroads GPS. Those are groups that
don`t have to disclose their donors, because of their murky tax status and
groups that exist by pretending that their spend is educational in nature
and not political.

Now, however, a coalition of pension funds, politicians and advocacy
organizations is calling on the government to force corporations that give
to those groups to disclose their political spending. And believe it or
not, it looks like they just might succeed. The push begin in 2011 when a
group of ten legal scholars petitioned the Securities and Exchange
Commission to require publicly traded companies to disclose their political
spending. One of those legal scholars, Robert Jackson of Columbia Law
School, explained how the new SEC rule would work.

(BEGIN VIDEO CLIP)

ROBERT JACKSON, COLUMBIA LAW SCHOOL: The thing to keep in mind is that
this is investors money. It`s the corporations resources that are being
spent on this. You might know that sometimes managers have their own
political action committees, that they put their own money into and spend
their own money on all kinds of issue advertisements, that would not be
captured by my rule. The rule we`re proposing is designed to have
investors know when their money is being spent on politics.

(END VIDEO CLIP)

KORNACKI: In the 20 months since that petition was filed with those first
ten signatures, there has been a massive ground swell of support with help
from major pension funds, Democratic politicians and shareholder activists,
approximately half a million people have filed comments with the SEC in
favor of the new rule. In this week "The New York Times" reported that the
SEC could propose a new disclosure rule as early as the end of this month.
Proposal has also attracted the attention of House Republicans who last
week introduced the legislation that would block the SEC from issuing any
political disclosure regulations. And Friday Kansas Republican Congressman
Kevin Yoder argued that a company`s political spending is outside SEC`s
jurisdiction.

(BEGIN VIDEO CLIP)

REP. KEVIN YODER (R ) KANSAS, : The SEC has a broad set of
responsibilities, but they`re not broad enough to include the regulation of
federal elections. The SEC is responsible for regulating a capital
formation, facilitating markets, managing and supporting investors. Its
role does not include monitoring and managing elections.

(END VIDEO CLIP)`

KORNACKI: OK. I want to bring in Josh Barro, columnist for "Bloomberg
View", Alexis Goldstein, former vice president at Merrill Lynch and
Deutsche Bank and now an Occupy Wall Street activist. Liz Kennedy, counsel
at the progressive think tank Demos and Jesse Eisinger. He`s senior
reporter covering Wall Street and finance for ProPublica as well as the
columnist for "The New York Times" deal book.

So, this -- it is interesting, the avenue that these -- these folks have
chosen to use the SEC. I guess I can understand why -- Congress is not
going to be acting on the issue of dark money any time soon. If you want
the IRS to be reviewing the tax exempts status of groups like -- it doesn`t
seem like that`s going to be happening. So you sort of have to be creative
if you want to tackle this issue now. And it -- you know, on surface I
guess when I hear about this, I think, well, sure, if I`m a shareholder in
a company and -- company is giving to somebody I -- you know, do not like
at all politically, I deserve to know that, don`t I?

JOSH BARRO, BLOOMBERG VIEW: Well, I think that -- the thing is that we`ve
had a lot of proxy votes on this where pension funds and other advocates of
this rule have asked shareholders and companies to vote on whether they
want disclosure. And those votes keep getting defeated and there are
plausible reasons why shareholders might not want the political activity at
the companies they invest in disclose. They are not necessarily edified
(ph), that`s you know -- the -- the political activity might enhance
profits, but the public knowing about the political activity might not
enhance the profits. So -- I don`t think -- I don`t think it is obvious
that it is in the shareholders` interest to have this rule. And that`s
what the SEC is supposed to do. They are supposed to protect the interests
of investors to ensure that their money isn`t mishandle.

KORNACKI: So, if the company is doing something that`s politically
unpalatable or offensive to a wide swath of people but - it potentially
helps the company`s bottom line that protects the shareholders?

BARRO: Right. And in even more broadly, there are all sorts of aspects of
a company`s business strategy that you might not want disclosure of to the
shareholders because that means disclosure of it to competitors and to the
public. So I think that, you know, I tend to agree with the congressman
that it`s -- the purview of the SEC is fairly narrow. They are supposed to
act in the interests of shareholders. And the way this petition is written
up, is there -- it`s an argument that`s in the interest of shareholders to
have this disclosure. But I think the real political reason that people
want this, is that they think it is in the public interest and that might
be a perfectly good argument. But I don`t think it`s a proper use of the
SEC.

LIZ KENNEDY, DEMOS: But I think, Alex, that we have to see that, of
course, it is in the -- best interest of investors and, in fact, the sec is
tasked not just with the authority, but with the responsibility to make
sure that there is this kind of disclosure of important risk factors to
investors. To investors need to have the information that they have a
right to, to make these investing decisions. And when companies are
spending this kind of money in politics, we are seeing them really expose
their companies to risk. We have business risks, there are legal risks and
this is the kind of element, as you say, certain things, we know, not the -
- company doesn`t have to disclose every single thing, but the company is
actually already - companies are required by the SEC to disclose a lot more
than simply basic profit and loss statements already. They have to
disclose executive compensation packages. And in fact, shareholders can
vote on executive compensation packages. The SEC has taken steps even
recently, in the last few decades to require - to in the campaign finance
realm dealing with political spending by municipal bond traders and state
and local authorities. So there - they`ve already made moves in this
realm, and this is really an outpouring of investors support demanding this
action from the SEC.

ALEXIS GOLDSTEIN, OCCUPY WALL STREET: Let`s not forget that this is a
classic tactic that corporations will take, which is arguing whether or not
something is in the SEC`s purview, whether or not they are supposed to make
a rule making. We had a rule called proxy access. That was a rule that
the SEC made to basically give investors the power to put things on the
proxy, which is the thing that they mail out. So you don`t actually have
to show up at the shareholder meeting, which is something that not every
day Americans who are these investors in these companies can do. And that
got overturned in court, because the number of business groups like the
business round table sued by saying , oh, no, no, no, the SEC does not have
the right to make this kind of a rule making. And this is just one of a
multi-pronged attack that is constantly waged against financial reform.

KORNACKI: Well, this is interesting because this -- gets to one of the
tools being used by advocates for the SEC rule is a -- one of their allies
here in their mind is Anthony Kennedy. The Supreme Court justice who is
sort of integral to Citizens United, which is this, you know, horrible
thing, this rule. But there is a line from Kennedy`s opinion on Citizens
United in 2010 where he basically held out what - what is being sought here
as a check on a corporate political activity. Here is what he said, this
is from his opinion. He said "Shareholders can determine whether their
corporation`s political speech advances the corporation`s interest in
making profits and citizens can see whether elected officials are in the
pocket of so-called money interests." Now, he wasn`t calling specifically
for the SEC to get involved. But he was basically saying that this is -
this is information that shareholders, you know, can use to sort of
restrain the political activity. Can and should use to restrain the
suddenly unlimited political activity that was unleashed by Citizens
United.

KENNEDY: And I think what we see there, really is Justice Kennedy assuming
that this kind of transparency was already present. I mean, transparency
is a bedrock business value. And it is a - you know, sine qua non of an
accountable democracy. And so Justice Kennedy, another quote from the
decision, says, you know, we have never seen a world, in which corporations
have unlimited ability to do independent spending, but also have, you know,
immediate disclosure through the Internet and what have you. And so that
this will allow shareholders and the public to hold these companies
accountable. But, of course, if they don`t actually know what these
companies are spending money on politically, then they don`t have the
capacity to exercise those kind of shareholder mechanisms of accountability
that the Supreme Court assumed would be in place.

JESSE EISINGER, PROPUBLICA: I know, the SEC, although, you know, it`s
newer organization that forget about walking and chewing gum. You know, it
can`t walk properly. And -- we are washing disclosure. And the disclosure
largely is meaningless already. Or misleading or at least contradictory.
And the fact that the idea that you`d want the SEC to be adding its -- to
its responsibilities now when it is -- doing such a poor job of doing the
basic task, you know, I hate to agree with the chamber of commerce.
Obviously Chamber of Commerce is making this argument in a completely
cynical way, but it`s true that the SEC has a responsibility, that it`s not
fulfilling.

GOLDSTEIN: And I do think -- there is a point to be made there. I`m in
favor of this, I think. This is important. But I think this is the
smallest thing that we can be doing. And what are we really talking about
here? We are talking about corporate person and we`re talking about this
idea that corporations have such undue influence over our democracy, right?
But there are other ways to solve this problem. We could try to make
corporations more democratic institutions. Because these are such powerful
institutions that have so much influence over our democracy and they are
unaccountable to anything but return on capital, we could try to make these
organizations more democratic from the inside out. But instead, we are
looking at this through this what I call - no, now what I call -- a neo-
liberal framework, in other words, let the free market decide, let`s have
disclosures and investors will decide. But instead of that, I mean why
don`t we think about making our democracy more democratic by putting
democracy inside of these corporations that are only accountable to capital
and not accountable to the peoples whose lives they affect. When there are
oil spills, when we have, you know, war mongering going on and instead we
are just talking about disclosure, which is in my mind ...

KORNACKI: Well, and we are -- you say we are talking about disclosure.
We`re also -- we`re talking about -- a sort of limited form of disclosure,
too. We are talking about publicly traded companies that are basically
giving to these trade associations and -- in groups like Karl Rove`s, his
nonprofit educational things. We are not talking about, excuse me --
excuse me. We are not talking about individuals, we are not talking about
private, you know, privately held companies. So, it`s sort of a narrow
scope here. But we -- when we look at sort of the impetus for this
challenge, which was -- which Citizens United and sort of the rise of money
that was sort of more disproportionate, I say, on the Republican side, you
have to consider the fact that in 2012 it didn`t work for the Republicans.
I want to talk about that after this.

(COMMERCIAL BREAK)

KORNACKI: So, we are talking about, you know, the SEC is -- maybe close to
approving a rule that would force publicly traded companies to disclose
their political giving and what that really -- we are really talking about
here is the publicly trading corporations that have given to these, you
know, to trade associations and then trade associations turn around, they
pool all this money and they go into target erases, you know, whether it`s
the presidential Senate, House, whatever, or giving to groups like Karl
Rove`s you know, Crossroads where they -- again, they do the same thing.
Karl Rove had this like lavishly funded group last year, but that gets me
to something I wonder about, because so much attention was paid in 2012, to
Crossroads to Karl Rove, and to this unprecedented money he had. And we
mentioned it in the open. He basically lost everything. He won a few
races, but all these competitive Senate races he went into, he lost them.
Are we -- is there a point that where maybe there`s too much emphasis
placed on money at least at the federal level?

GOLDSTEIN: Well, but I think this is a reason why we are seeing the
Chamber of Commerce and groups like that fight this so hard. Because they
realize that the power of the force of the state and they realize the power
that if a light shines on this, that sometimes the public isn`t going to
vote just based on the candidate that has the most money. And so, I think
they do have a reason perhaps to be scared about this. because it is proven
that, you know, when this is reported on, when do we -- when we have things
like, you know, the 47 percent video that`s leaked and when we have
transparency about what is really going on, sometimes the public doesn`t
just vote with the money. And so I think that`s part of the reason why we
see such push back on this idea.

KENNEDY: And I`d also like to say that we should keep in mind 95 percent
of the victorious candidates - the successful (ph) candidates spending, but
more able to outspend their opponents. So, when we say money didn`t mean
everything ...

KORNACKI: But, you know, you have a cycle there where you get elected to
the House and often from a safe district and fundraising is easy. And you
get a token opponent and so ...

KENNEDY: Fair a lot.

KORNACKI: I can`t - I can`t always tell, which is the cause and the
effect.

EISINGER: We regularly see these lavishly spending candidates like Meg
Whitman lose. Money is not the all-powerful force that it tends to be.
The other thing about corporate spending is you are largely going to find
them buying both sides. And this goes to the point that -- you were making
earlier, which is that they change the conversation through limiting what
is possible. What -- so they are narrowing the Washington argument about
the -- you know, the areas, in which to consider policy. So that`s --
that`s important, but what you are going to find when these companies do
disclose this, is that they are just buying both sides and it is going to
be canceling each other out and not particularly that interesting.

(CROSSTALK)

GOLDSTEIN: Sometimes that`s true, but then in companies like Exxon, they
have been totally 100 percent devoted to the Republican Party.

EISINGER: Sure, it`s not always true.

GOLDSTEIN: So, that`s not always true.

KENNEDY: And more specifically, I think, to bring us back to the question
about the SEC rule, because we could, of course, have large conversations
about all of the dynamics and money in politics and what that means in
terms of influence and policy making in the country. But really here we
are talking about disclosure. And you said earlier that we are washing
disclosure. Actually a lot of companies already provide this information.
Some of these voluntary disclosure policies don`t work out as well as we
would like. And so what we are finding is that companies may be taking a
certain policy, a certain position, publicly, for example a lot of big the
health insurers were publicly in support of health care reform. But then
when we have these inadvertent disclosures, we saw that Aetna was actually
providing $7 million to (inaudible) group.

KORNACKI: When you say, an inadvertent disclosure, what -- how does that
work?

KENNEDY: Well, what I mean is that there was - a disclosure form that they
wrote, that they had -- contributed $7 million to if I want to see for
group, and then the chamber. And this was not just information that they
have meant to disclose. It ended up going up online, some ...

BARRO: It was the IRS. Administrative error, basically ...

(CROSSTALK)

KORNACKI: ... to be confidential.

KENNEDY: Bit it was supposed to -- I would -- I would only differ to say
that it was supposed to be confidential on the IRS site. That, of course,
was the difficulty ...

KORNACKI: Right.

KENNEDY: That the (inaudible) group don`t disclose, but Aetna has
voluntary disclosure policy with their shareholders that they have entered
into and yet this kind of political spending was not disclosed under. My
point was just they are playing -- trying to play both sides of the game by
publicly saying we support these positions. We have publicly stated values
and policies. Perhaps for tolerance. But then some of their appropriate
political spending is diametrically opposed to that. Investors have a
right to look into those decisions. It is material to certain investment
decisions.

BARRO: I`m confused by the end of that statement, though. I mean I can
understand why this is a matter of public concern. Why someone who`s
shopping for a health plan may be concerned about that. I don`t understand
how the -- how the Aetna shareholders were necessarily harmed by that
outcome. I would just go back to the proxy votes where we keep seeing
proposals put before shareholders, do you want more disclosure of the
political spending by the company? And they keep going down. And so I
think if this - you know, if the case is really so strong that this is in
the interests of the shareholders, these companies have these disclosures,
I don`t understand why the shareholders are declining that opportunity. It
suggests to me this is, in fact, not to their advantage and not - and
therefore, not properly in the purview of the SEC.

KENNEDY: So, first of all, of course, political -- political disclosure
resolutions are far and away this year and last the number one question
that shareholders are being able -- are being asked to vote on. There are
120 corporate political disclosure resolutions on the ballots. That is not
even counting companies just this year like Qualcomm, that after these
petitions, these resolutions, were filed, voluntarily decided to disclose
this information. And these votes are actually receiving an average of 29
percent in favor of these disclosure resolutions, which is a huge threshold
really. 30 percent about a third of investors voting this way is really a
-- really a strong outpouring of investor support, because of the way the
proxy votes often happen. And -- you know, this is also management is
recommending a "no vote" and frequently -- you know, ISS and other -- proxy
advisory firms recommend frequently that these -- big groups are just vote
along management.

EISINGER: I would not -- brought too much information from the proxy
votes, from the institutional investors, because they are a feckless and
greedy lot. They don`t want to spend any money on this kind of stuff.
They want to just simply invest like the index. There -- and charge the
fees and not get involved in this kind of disputes. They don`t even vote
their interests when they want to split. The chairman or - CEO, they
barely ask for information on executive pay. So there, you know, you are
not getting any good information out of that. But I return to the issue of
the SEC, which is not an organization that`s working in the -- for the
benefit of shareholders right now. And investors in general. They don`t
police the markets properly. They don`t have adequate disclosure. Mary Jo
White is coming into an agency that is really largely incompetent and
overwhelmed and under-resourced. So, -- do we really want this to be a
priority? I would argue, you know, wading into an enormous political fight
now when they are dependent on Congress for funding is would be a
disastrous idea for Mary Jo.

KORNACKI: Well, that`s -- I want to pick that up in the next segment. The
idea of if not the SEC, where, for people who want this kind of disclosure?
Or, if the SEC does, as the reporting suggests, go ahead and implement this
rule, practically speaking what will that mean? We`ll get to that after
this.

(COMMERCIAL BREAK)

KORNACKI: So, so Jesse was just saying if you want to get this kind of
disclosure, if you want to know which publicly traded companies are giving
what amount of money to which groups, the SEC is the wrong avenue for it.
The SEC -- so, my question, that is, these groups have gone to the SEC
because it is not happening with the IRS, it`s not happening with Congress.
Where do you go if not the SEC? Is there anywhere else?

GOLDSTEIN: I mean I think the issue is that these companies that affect so
many of our lives outside of the shareholders are not accountable to anyone
but the shareholders. And I feel like the only way to hold them
accountable which is, I feel like what we are really talking about here,
when we are talking about disclosure, we want to know where they are
spending their money and we want to know what they are influencing, but you
have to change them from the inside out. And you have to look at ideas
like whole determination, which is this idea in Germany that actually puts
workers on the board of directors. And it`s been around since the `70s in
Germany. But while I think this is important, and I think we absolutely
should do what we should absolutely go to the SEC and ask for disclosure,
this is a multi-pronged fight. And we really have to think about what are
we really talking about here? We are talking about the fact that
corporations are only accountable to their shareholders even though they
affect the lives of so many people who never consent to be affected by
them.

KENNEDY: And I have to say, I would push back to say that this is
absolutely the appropriate role for the SEC. And this is really a position
that business has supported as well. It is really non-controversial, that
political spending should be disclosed. The UK has been requiring their
companies to disclose their political spending for years. The Committee
for Economic Development, a lot of the meeting business voices absolutely
support.

KORNACKI: But there are a lot of ..

(CROSSTALK)

KENNEDY: -- disclosure.

KORNACKI: Businesses (ph) that do not.

KENNEDY: Of course, there are. But this is not a monolithic instance.

KORNACKI: Right.

KENNEDY: And in fact, you know, commissioner Aguilar of the SEC last year
gave a very - a big used his time to get a big speech to the SEC in support
of this role. We have seen over half a million Americans and American
investors going to the SEC requesting that they make this role. So, I
think that it is really -- it is the appropriate role of the SEC and it is
important for American investors to know how their money is being spent in
politics. I mean, America should be a place where everyone has an equal
chance and an equal say. But right now investors have no chance to say
anything about the political spending their corporations might be involved
in. Because they just don`t know about it. And that`s something that the
SEC has the power and they have responsibility to rectify.

BARRO: You know, I think this is the sort of thing that would probably be
the purview of the Federal Election Commission. Which obviously is a
basket case, and not doing any of the things that ...

KORNACKI: They`re still doling out fines from like a 1984 presidential
election, I think.

BARRO: Right. Yeah. Literally, I think. Recently.

KORNACKI: John Glenn was fined.

(LAUGHTER)

BARRO: Yeah, but -- the -- as you noted earlier, that for example, the SEC
wouldn`t touch privately held companies. If the issue, and I think this is
a real issue, is that we need broader disclosure of money in politics, then
the SEC because it can only get the publicly traded companies, is actually
a very limited solution to that. And I think when -- I mean you -- when
you look at people like Art Pope, the story, I think, is arguably more
about high net worth individuals and privately held companies than it is
about publicly traded companies because Republican traded companies are
hemmed in in various ways, in which they can engage in politics. There are
sort of -- they have to be more consensus institutions, they have to play
both sides. So, maybe the way they are spending money is less effective
than the way privately held companies would spend money. So, I think that
-- the -- we do want some sort of broader disclosure regime. But it`s for
the public interests, not specifically for shareholder ...

KORNACKI: And we -- as Karl Smith, he is an economist who`s been on this
show, and we asked him this week about this issue. And he raised an
interesting point that kind of gets to what you are saying, where he said ,
if you have this rule in place, you`re going to have -- companies that are
a little bit more maybe moderate, a little bit more practical about how
they spend their money. They are going to be extra sensitive to the
political considerations in this atmosphere. So they are just going to
back out. But the Art Popes of the world, the more extreme elements, more
extreme in terms of ideology, and whether giving their money, that`s only
going to ramp up their influence.

GOLDSTEIN: But you have to start somewhere. And you can`t not do
something because you`re afraid of some byproducts happening. And like, to
the point about whether or not this belongs in the SEC or not, like, and
again, I do think this is the larger issue and this is absolutely not a
panacea. Investors should have complete information. And investors should
know where their money is being spent.

KORNACKI: All right, so. What should -- what should we know for the news
week ahead? My answers are after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: There are other
new players in the media landscape as well like super PACs. And you know
that Sheldon Adelson spent $100 million of his own money last year on
negative ads. You`ve got to really dislike me ...

(LAUGHTER)

OBAMA: ... to spend that kind of money.

(LAUGHTER)

OBAMA: I mean, that`s Oprah money.

(LAUGHTER)

OBAMA: You could buy an island and call it Nobama for that kind of money.

(LAUGHTER)

(APPLAUSE)

OBAMA: Sheldon would have been better off offering me $100 million to drop
out of the race.

(APPLAUSE)

(CHEERING)

OBAMA: I probably wouldn`t have taken it, but I`d have thought about it.

(LAUGHTER)

OBAMA: Michelle would have taken it.

(LAUGHTER)

OBAMA: You think I`m joking.

(LAUGHTER)

(END VIDEO CLIP)

KORNACKI: So for those of you who were too busy watching the Rockets
Thunder playoff game last night, that was the president at the White House
correspondent`s dinner being very funny on the subject we were just talking
about, dark money in politics, big money in politics.

So, what should you know for the coming week? You should know that after
Congress gave it to go ahead, the Federal Aviation Administration yesterday
suspended all furloughs of air traffic controllers caused by the sequester.
The president is expected to sign the bill officially ending the furloughs
as early as tomorrow. These furloughs had been in effect for less than a
week. It apparently the inconvenience of waiting around airport food
courts was so severe that Washington found it necessary to act immediately.

You should know that while air travel will go back to normal, poor people
across the country will continue to suffer because of the sequester.
Already food pantries have closed and teachers and health workers have been
furloughed. Ultimately, the sequester means that 70,000 children will lose
access to Headstart programs, 125,000 families will not get rental
assistance and the FDA will have to cut food inspections. This Ezra Klein
noted this week, the willingness of Congress and Democrats in particular to
restore spending for those who don`t need it likely spells doom for those
who do. He writes that "What Democrats said Friday, was that in any case
where the political pain caused by sequestration becomes unbearable, they
will agree to cancel that particular piece of the bill while leaving the
rest of the law untouched." So, we are saying this clearly, the pain of
sequestration will be concentrated on those who lack political power.

You probably know that deficit hawks, some of whom are unwilling to end the
sequester, love to warn that debt is crippling the economy and that
government spending will doom the nation`s children. So, you should know
that according to a new report from Goldman Sachs, the deficit is in fact,
"shrinking rapidly." The report finds that the deficit was over ten
percent of GDP in 2009. But it`s estimated to be just 4.5 percent this
year and is expected to keep shrinking. The changes due partly to
decreased government spending, but was mainly brought down by rising tax
revenues. So, it turns out that our runaway deficit is now running the
other way, which means now our politicians can funnel all the passion they
brought to the deficit debate into finding work for America`s jobless. In
theory at least.

Finally, you should know that the body of Brown University student Sunil
Tripathi, who was falsely accused of being one of the Boston bombers on the
crowdsource site Reddit, was found this week in the Providence River.
Tripathi had been missing since March, but after police released pictures
of the actual suspects, his name was mentioned frequently online as people
tried frantically to solve the case. We don`t yet know how Tripathi died
and we may never know. But you should know, that no matter how well-
intentioned the search to find the bombers may have been, there are immense
consequences for reckless speculation and accusation. If you want to find
out what my guests think we should know for the week ahead. Start with
Josh.

BARRO: Well, you should know there`s going to be important monetary policy
action this week, both from the Fed and the European Central Bank. Central
Bank has been a little bit less dysfunctional than legislatures over the
last few years, so even though the sequester is going to continue for the
foreseeable future, the Fed will probably indicate that it`s going to
continue with its asset purchase program that it said last month it might
stop -- ease off earlier. The European Central Bank is probably actually
going to cut rates. So, this is a silver lining, even though we can`t get
fiscal policies, we need to grow the economy. There will be some monetary
policy offset.

GOLDSTEIN: You should know that the House will soon decide whether or not
they want to gut a piece of Wall Street reform called the swaps push-out
that says that swaps and other derivatives have to be held in a separate
account from your FTIC-insured money. And you should know that two
Democrats, Jim Himes from Connecticut and David Scott from Georgia are co-
sponsoring this gutting of this important Wall Street reform. And so, if
you think that we should have risky derivatives in one account separate
from your FDIC-insured money and you live in Georgia or you live in
Connecticut, you should tell Rep Himes or Rep. Scott that they are voting a
wrong way. The bill is HR992 and I`ll tweet it out the show.

KORNACKI: Jim Himes from the gold coast of Connecticut. Not a surprising
us.

KENNEDY: You should know that this week May 1st is International Labor Day
and that it is a really great opportunity to consider the plate of the low
wage and low income workers that you just referred to, some of the long-
term unemployed. But then we see in New York City fast food workers,
hundreds of fast food workers are now out on strike. And we obviously, the
workers in Bangladesh have been demonstrating against the unsafe working
conditions that they are forced to toil in. And so, we should take this
opportunity on Wednesday of Mayday, International Labor Day to contemplate,
you know, what it is that, with the kind of conditions that the people that
make our clothes and serve our food are working under and whether they meet
our standards for kind of the common human dignity that we really all
share. So, there`s a good time to think about that!

KORNACKI: Jesse?

EISINGER: I`m looking a little farther ahead at whether there`s actually
going to be a coalition of Republicans and Democrats to go after the big
banks. We saw last week Brown and Vitter, senator from Ohio and senator
from Louisiana, Democrat and Republican, come up with a very strong big
bank solution. The question is, whether this actually develops into a
coalition of, you know, political potency or not.

KORNACKI: OK, my thanks to Josh Barro, "Bloomberg View." Alexis Goldstein
of Occupy Wall Street Liz Kennedy, of the progressive think tank Demos and
Jesse Eisinger of. ProPublica. Thanks for getting up and thank you for
joining us.

We`ll be back next week on Saturday and Sunday at 8 A.M. Eastern time,
coming up next is "MELISSA HARRIS-PERRY". On today`s "MHP," the debate
over genetically modified foods. Yes, your apple is bigger and redder, but
is it better? "Top Chef`s Tom Colicchio joins the panel. That`s on
"MELISSA HARRIS-PERRY" -- she is coming up next.

And we will see you next week here on UP.


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