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All In With Chris Hayes, Wednesday, May 22nd, 2013

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ALL IN with CHRIS HAYES
May 22, 2013

Guests: Errol Louis, Kaitlyn Hunt, Kelly Hunt Smith, Julia Graves, David Cay Johnston, Marielena Hincapie, Felipe Sousa-Rodriguez


CHRIS HAYES, HOST: Good evening from New York. I`m Chris Hayes. And
thank you for joining us tonight.

An amazing strange, weird, fascinating news day, including a stunning
development involving one of the Boston bombing suspects and his alleged
role in a grizzly triple homicide that featured marijuana sprinkled all
over the victims` bodies. That`s true.

Also, we`ll take you to Florida where an 18-year-old high school
student faces felony charges for having a relationship with another female
student.

Plus, a truly remarkable thing happened in Washington, something we
rarely see, and it was a cause for spontaneous celebration by many. I`ll
tell you what happened.

But we begin tonight with a big political announcement that came about
in a truly unusual way. We got news today of a major campaign launch, but
the launch itself did not actually happen today. Technically, it happened
in the overnight hours.

Instead of big, flashy, carefully press conferences that mark most
candidate announcements, former Congressman Anthony Weiner officially
launched his bid for mayor of New York City by posting a two-minute video
to YouTube overnight -- which is not the way these things are usually done.
But this is, of course, Anthony Weiner we`re talking about. So it`s
possible and reasonable that he does not want to hold a big press
conference to launch his mayoral campaign, because the last time he was
holding press conferences, this is what they looked like.

(BEGIN VIDEO CLIP)

FORMER REP. ANTHONY WEINER (D), NEW YORK: I`ve never, as I said in my
statement, met any of these women.

REPORTER: Did you have phone sex?

WEINER: I was never in the same room with them. I was never had any
physical relationship whatsoever.

REPORTER: Did you have phone sex?

(CROSSTALK)

REPORTER: Congressman, did you promise anything in exchange for these
conversations?

WEINER: No.

REPORTER: Did you make any offers of advancements?

WEINER: No, I did not. I did not.

REPORTER: Will you help to support Arnold`s love child?

WEINER: Today, I`m announcing my resignation from Congress --

HECKLER: Yes! Bye, bye, pervert!

WEINER: -- so my colleagues can get back to work, my neighbors can
choose a new representative --

HECKLER: Senator Weiner, the people must know! Were you fully erect?

WEINER: -- and most importantly, my wife and I can continue --

HECKLER: The people demand to know! Were you fully erect?

WEINER: -- to heal from the damage I have caused.

(END VIDEO CLIP)

HAYES: Those scenes, of course, unfolded during Anthony Weiner`s
Twitter sexting scandal two years ago. Weiner, you`ll remember, was a
rising star congressman from New York with what seemed to be very promising
mayoral aspirations until he was forced to admit that he had, in fact,
among other things attempted to tweet a photo of himself in a pair of
cotton boxer briefs to a woman who was not his wife.

And while it seemed at first to be kind of episode that might
ultimately be written off as an embarrassing footnote, the Anthony Weiner
sexting scandal turned out to have exactly the right ingredients for a
resign from Congress level scandal.

For starters, his name is Anthony Weiner. He was a brash and
ambitious and had made enemies on both sides of the aisle in Washington.
There were photos.

He was married at the time, and his wife, Huma Abedin, just happened
to be an incredibly compelling political figure in her own right as a top
adviser and perhaps the closest confidant to Hillary Clinton, the woman in
the center of one of the most famous political scandals in American
history.

Oh, and his wife was pregnant at the time. And again, because it
cannot be over-emphasized, his last name is Weiner.

Seriously, do not underestimate the importance of the name thing.

With folks at "Talking Points Memo" reporting today that whether on
purpose or by coincidence, the overnight rollout of the mayoral campaign
had the effect of preventing the sleazy front page puns that might have
graced the cover of the city`s tabloid papers if the announcement had been
made today. Quote, "Though Weiner`s campaign won`t say whether they
purposefully left the Big Apple`s tabloids in the dark, a night editor who
works at one of the two papers told staffers they were certain Weiner`s
timing was to shaft them. `That`s exactly what he did,` the source said.
`Everyone was pissed.`"

And, of course, the daily news still could not resist going with the
headline Weiner`s all in online.

But now, with or without the dirty puns, two years after he resigned
in disgrace, amid questions about his anatomy for producer of Howard
Stern`s radio show, Anthony Weiner is trying to recreate his political
career through a post-scandal second act.

(BEGIN VIDEO CLIP)

WEINER: Look, I made some big mistakes, and I know I let a lot of
people down. But I`ve also learned some tough lessons. I`m running for
mayor because I`ve been fighting for the middle class and those struggling
to make it my entire life. And I hope I get a second chance to work for
you.

(END VIDEO CLIP)

HAYES: The second act is something many a scandal plagued politician
has achieved before. It is something Mark Sanford achieved just a couple
weeks ago.

But there is no guarantee that Anthony Weiner will have the same kind
of success because -- this is really important -- there are no rules for
post-scandal second act. There is no way to tell who`s going to be able to
pull it off and who is not. The whole process is haphazard and random and
fascinating because I truly believe that at these moments, we find out a
whole lot about what exactly our society thinks is unforgivable and what
isn`t.

Joining me at the table, MSNBC`s Alex Wagner, host of "NOW WITH ALEX
WAGNER," and Errol Louis, political anchor for New York 1 News and host of
"The Road to City Hall."

All right. So today was the rollout. Here`s my question for you,
Errol: what`s the bigger problem for him with voters? There are two items.
There is the actual content of the G-chat messages or Facebook messages he
had with women and the photos and the puns. And then there`s the fact when
he was busted for it, he lied and lied and lied.

I want to show you just one of the example of this. This is him
talking to my colleague, Rachel Maddow.

(BEGIN VIDEO CLIP)

RACHEL MADDOW, "TRMS" HOST: In terms of your constituents watching
all of this unfold and wondering if there is fire here behind all of the
smoke, wondering if you`re doing creepy things online, essentially, what --
how do you intend to reassure your constituents and to the people who have
supported you politically that they shouldn`t think that you`re a creep?

WEINER: Well, you know, the simple fact here is that what this
appears to be is probably what it is, someone making fun of my name,
someone trying to cause trouble for me, maybe poke fun at me. You know,
when your name is Weiner and someone posts a picture like that, the most
obvious conclusion is that someone was pranking me and punking me, and I
get that.

(END VIDEO CLIP)

HAYES: Someone was punking him. It was him.

(LAUGHTER)

HAYES: But that`s the question, right? Like, is that the bigger
problem politically?

ERROL LOUIS, NEW YORK 1: I don`t think so. I mean, I was part of
lying tour, he came on my show.

HAYES: Yes. I think the first interview was with you.

(CROSSTALK)

ALEX WAGNER, MSNBC ANCHOR: The lying tour.

LOUIS: But then he came back.

HAYES: Oh, you`re saying that tour? Right.

LOUIS: Yes. And then rehabilitation tour he began with us.

HAYES: He chose to begin with you.

LOUIS: He started by saying that he was sorry. He apologized to me,
he apologized to the audience, he apologized to the city. He`s asking for
a second chance.

And I think because everybody saw what went on before, for a lot of
people, you know, because we do have a city with a new mayor and do have
problems in the city, and we have a school of 1.1 million kids and 35,000
cops and, you know, questions about how to control them.

I think people are actually willing to look past that. I think the
bigger question that he has is not, will people sort of buy in or not,
because the polls show that it`s 50 percent. Some people say he shouldn`t
run at all, others say they`ll give him a chance. So, fine. That`s where
he is.

The real question is, does he have what New York is looking for? And
nobody knows that, because unlike after 2001, there`s no overwhelming
crisis driving the city right now.

HAYES: He has to -- before you get to the substantive question he`s
got to get over this first stage of just reentering public life.

And my question, Alex, is like, at what point does the press run
itself out like a dog that gets tired about this issue, right?

WAGNER: But there`s so much there, because even if you set aside this
sort of digital forays of Anthony Weiner, there`s the hubris and the way he
conducted himself in Congress. There`s the fact that he`s trying to make
himself --

HAYES: But hubris is like -- I mean, that`s not an indictment of a
politician.

WAGNER: No, but there is -- he is so nakedly political, even in that
YouTube ad, right? He talks about --

HAYES: Because he`s a politician!

WAGNER: Wait a second. Anthony Weiner has been so motivated by his
base and nothing more than appealing to his base, which tends to be older
voters, New York residents, that video is amazing.

He talks about playing stick ball in the street. Apparently, Anthony
Weiner was raised in 1920s New York. He talks about the G.I. bill, he
talks about being nickel and dime. I mean, he`s clearly going for one
piece of his constituency.

HAYES: Here`s the thing. I`m going to get in trouble for saying
this, I`m going to say it anyway. I think a lot of Anthony Weiner`s
politics I don`t like. The guy voted for the Iraq war, his politics on
Israel I don`t like. There`s a whole lot substantively like I don`t -- I
am not in line with Anthony Weiner`s politics.

But I think when you look at the levels of scandal there are, I think
the guy got a raw deal. Like what he did was creepy or weird or whatever,
however you want to clarify it, if it was my friend who told me they were
doing this while married, I would like be like, get it together, this is
messed up, I`m really mad at you.

But in terms of public life, like I think there`s this crazy mismatch.
I think it`s because of New York, I think it`s because Huma Abedin is close
to the Clintons, I think it`s because of the name, but there`s a complete -
- fine, argue against it.

(CROSSTALK)

HAYES: I think there`s a total mismatch between the level of
infraction and level of scandal.

WAGNER: I disagree.

LOUIS: We`ve just seen a tidal wave of actual sleaze, people stealing
money, being taken out in handcuffs, facing prison time.

HAYES: Yes, New York has like an indicted politician every other
week.

LOUIS: We have a serious, serious problem. And you`re right. For
some people, not everybody, but for some people this is spitting on the
ground, right? It`s two years in the past and the question is, OK, that
was then, what are you going to do for me now?

And again, about half of New York seems to be willing to at least give
him a chance and the other 50 percent --

HAYES: Why am I wrong?

WAGNER: Because there is a difference, whether it`s right or not,
between cheating on your wife and falling in love with person who cheated
on your wife and marrying her, and going -- there is. In the American
imagination --

HAYES: You`re talking about Mark Sanford.

WAGNER: I`m talking about Mark Sanford -- versus the creepy, sleazy,
online behavior of Anthony Weiner, which makes people feel icky.

Now, I`m not saying that this is necessarily fair. But it is a
totally different scenario, and the fact that he kept on denying this over
and over and over again, enlisting strippers in Las Vegas named Ginger to
be on his side and protect him from what was the truth.

HAYES: Right.

When I read -- when I`m thinking about managing this, I want to play
this little part of it, because this is going to be the center of this
whole thing and this is always the hardest part of these is how spouses as
political actors, props, but actors also, people with volition and agency,
but also they always play such a strange role in American politics to begin
with.

This is Huma Abedin`s appearance in -- Anthony Weiner`s wife and the
mother of their child -- her appearance in the video. Take a look.

(BEGIN VIDEO CLIP)

WEINER: Every day starts right here. And it`s the best part of my
day. And then you step outside and New York`s like no other place.

HUMA ABEDIN, WEINER`S WIFE: We love this city, and no one will work
harder to make it better than Anthony.

WEINER: I will fight for you every single day. Thank you for
watching.

(END VIDEO CLIP)

HAYES: This is going to be a huge part of the strategic management of
this entire thing, and, of course, they did -- they gave interviews to a
"New York Times" magazine reporter, long profile.

What was your reaction? You`re rolling your eyes.

WAGNER: Couple things, I think a lot of women were relieved when
Jenny Sanford didn`t feel like she had to stand by her man, when Huma
Abedin was not at the press conference --

HAYES: She was not. Right, yes.

WAGNER: -- when there was a sense women don`t have to pretend they
are OK with this type of behavior.

And to see her sitting on the stoop with him is, A, not surprising,
but it is disappointing.

HAYES: This is -- I don`t know. What do you think? That feels
unfair, though.

(CROSSTALK)

LOUIS: Let`s assume she`s being honest. Let`s assume she`s being
honest that whatever happened, they worked it out. And number two, she
still thinks he`s a good candidate that would be good for the city.

HAYES: I just -- the thing that drives me bananas, the thing that
drives bananas, is that, like, the entire press corps, the city hall press
corps, how many of those people are unfaithful to their spouses? Huge
amounts. White House press corps, how many of them?

I mean, give me a break! It`s like the idea of the moral sanctimony
that comes forward, that these kind of scandals bring out. I just find it
completely -- it just drive me crazy. It`s hypocrisy.

It`s like, people do things, if they do bad things, they should be
held to account for it, but also, people are human beings. And like --

LOUIS: But you know what, Chris? I mean, I was speaking to business
leaders the other day, and what they`re saying is -- I mean, big
businesses, they don`t want a mayor who`s a laughingstock and that`s --

HAYES: Right. I think that`s part of it, too.

WAGNER: And, Chris, it was over and over again, the denials, the name
calling.

HAYES: I agree, I agree. I agree, I think the lying and credibility
is his biggest, that`s the biggest bridge he has to cross.

MSNBC`s Alex Wagner and New York 1`s Errol Louis -- thank you very
much.

The case of a gruesome 2011 triple homicide in Massachusetts has gone
cold. Now, officials say one of the murderers was Tamerlan Tsarnaev. The
suspected Boston marathon bomber and his accomplice, a man shot dead today
in Florida by an FBI agent. Michael Isikoff joins me to make sense of this
wild development, next.

(COMMERCIAL BREAK)

HAYES: Coming up, an 18-year-old high school senior has until Friday
to take a plea deal, admitting to child abuse, potentially labeling her a
sex offender. Her allegedly crime has caused a nationwide controversy.

And up next, a jaw-dropping development in the Boston investigation.

Stay with us.

(COMMERCIAL BREAK)

HAYES: A bizarre and deadly twist today in the Boston marathon
bombing investigation. Officials say a man with ties to one of the bombing
suspects was shot to death following a confrontation with an FBI agent.

Twenty-seven-year-old Ibragim Todashev was being questioned by the FBI
in Orlando as part of an effort to find and talk with anyone who had
contact with Tamerlan Tsarnaev, the older bombing suspect, who was killed
in a shootout with police.

Law enforcement officials tell NBC News that Todashev had spent time
in the Boston area, where he was a mixed martial arts fighter, trained at
the same gym as Tamerlan, and knew the older Tsarnaev brother.

Officials say Todashev was at first cooperative with the FBI agents
questioning him. But earlier today, Todashev allegedly turned on them,
attacking an agent, according to officials. Todashev was then shot and
killed.

But incredibly, again, according to anonymous law enforcement sources,
just before he was killed, Todashev confessed to playing a role not in the
Boston bombing, but in a brutal unsolved triple murder in Massachusetts.

OK, that unsolved murder has lurked as a tantalizing mystery ever
since the Boston bombings, because it turns out the day after September
11th, 2011, three men were found dead, their throats cut and their bodies
covered in marijuana in an apartment in Massachusetts, and one of the
victims was a friend of Tamerlan Tsarnaev`s.

Law enforcement officials tell NBC News that Todashev told them that
Tsarnaev was involved in those killings, too. Todashev was giving a
statement on his role in the murders when he was killed. Again,
authorities believe that Todashev did not have any role in the Boston
marathon bombings and the FBI is reviewing the incident that led to
Todashev`s death.

Let`s turn to NBC national investigative correspondent Michael
Isikoff.

Michael, I have 1 billion questions about this. The first of which
is, how does this guy end up getting shot? At first, there were reports of
him having a knife. Now, it`s unclear that he even had a knife. There are
three agents in his apartment, it appears.

How did this go down?

MICHAEL ISIKOFF, NBC NEWS NATIONAL INVESTIGATIVE CORRESPONDENT: Look,
we don`t know. But he was being pressed by the FBI and these state
troopers to make, sign this statement, confessing to a role in this
gruesome murder and a confrontation took place.

It`s worth noting that the deceased here was this mixed martial arts
expert who had, apparently, quite a temper. His rap sheet shows repeated
arrests during fender benders, scrapes with cops, scrapes at traffic stops
where he got into a fight. In fact, there`s even a notation about his use
of his mixed martial arts skills and being far above that of the average
person in one of the police reports.

So, you could envision a scenario where his temper flared up, he
attacks the agent, one of the agents gets out the gun and shoots him, but
we`re speculating at this point. We don`t know for sure. That`s why
there`s this FBI team that`s gone down to investigate.

HAYES: OK, so what we are hearing, ever since the few days after the
Boston bombings, people pointed to this triple murder in Waltham,
Massachusetts, and there`s a few things about it that seemed. It was a
very strange murder, they think people were murdered by someone they knew,
because there was no sign of forced entry, their throats were cut, there
was marijuana sprinkled on their bodies.

There was the fact that Tamerlan Tsarnaev was friends, even according
to one report, possibly best friends he said, with one of the people who
was killed. He didn`t go to the funeral.

Do we have evidence other than this, are law enforcement officials
fairly confide that, in fact, Tamerlan Tsarnaev was responsible for these
deaths?

ISIKOFF: Well, we`ve known for the last couple of weeks they were
looking hard at this, that they suspected there was a connection. There
were a lot of weird things about that murder. You have -- it was
supposedly drug dealers, but the marijuana is there on the scene, so they
didn`t take -- whoever did it, didn`t take all the drugs.

There is the additional fact that it took place on September 11th,
which does leap out.

I mean, look, this story has said so many crazy twists and turns.

HAYES: Yes.

ISIKOFF: We`ve gone from an international terrorist conspiracy to a
drug deal gone awry. We`ve, perhaps, some terrorist overtones. It`s --
the one thing we can say for sure is this doesn`t fit neatly into any
scenario that the national counterterrorism center has probably studied or
any profile of here`s what we need to look for, here`s what we need to
prevent in the future or the kind of people we have to target, because it`s
just so off the charts in every respect.

HAYES: I have to say, I`m really curious what we find out about the
actual incident and whether we get hard physical evidence linking Tamerlan
Tsarnaev to those murders. That aspect of it is mysterious, and
fascinating, bizarre, and upsetting in a lot of ways.

NBC`s Michael Isikoff, thank you.

ISIKOFF: Sure.

HAYES: Coming up, a high school senior says she had a consensual
relationship with another girl at her Florida school, and now, she`s facing
felony charges. That`s next.

(COMMERCIAL BREAK)

HAYES: We`ve been following an incredible story, which comes to us
from the city of Sebastian, Florida. It is the story of Kaitlyn Hunt.
Kaitlyn is an 18-year-old high school senior, who`s been arrested and
charged there with two felony counts of lewd and lascivious battery on a
child, sex abuse charges, which carry heavy penalties in the state of
Florida, including having to possibly register as a sex offender.

Her crime was that she was having a consensual relationship with
another girl at her school, a freshman, a minor.

Kaitlyn, her mother, and their lawyer will join me a moment, and
today, they held a press conference hoping that common sense would prevail.

(BEGIN VIDEO CLIP)

JULIA GRAVES, ATTORNEY FOR KAITLN HUNT: The state attorney`s office,
the sheriff`s department, and the parents of the girl involved are
prosecuting her under law intended to protect children from being preyed on
by adults.

(END VIDEO CLIP)

HAYES: And today, for the first time since her arrest, Kaitlyn Hunt
responded to the overwhelming support she and her family have received.

(BEGIN VIDEO CLIP)

KAITLYN HUNT, HIGH SCHOOL SENIOR: I`m just thankful and grateful that
all these people are by my side, and that they`ve been by my side since day
one -- overwhelming, to say the least. Scared, I`m scared. Just kind of
hopeful for the best. Didn`t think it would be this big at first, but I`m
glad it is. You know, I`d rather people see how it is across the world
than just here in Sebastian.

(END VIDEO CLIP)

HAYES: Kaitlyn Hunt went to Sebastian River High School and played on
the basketball team. She and her freshman teammate developed a
relationship at the beginning of the school year. The younger girl`s
parents upset about the relationship notified the authorities and Kaitlyn
Hunt was immediately arrested, handcuffed, and charged with two felony
counts of lewd and lascivious behavior on a child 12 to 16.

Kaitlyn now faces a deadline of this Thursday on whether to accept a
plea deal that includes pleading guilty to child abuse, a sentence of two
years of house arrest, and attending sex offender counseling, where her
lawyer noted today she would be joined by sex offenders guilty of genuinely
predatory behavior.

A change.org petition on Kaitlyn`s behalf has gathered more than
56,000 signatures, a free Kate Facebook group has topped 40,000 followers.

But authorities say they will not drop the case. The state attorney
for Florida`s 19th Circuit, Bruce Colton, told ALL IN that there are 20 to
25 cases a year involving relationships with someone 18 or older with a
minor 12 to 16 years old, 98 percent of those cases never go to trial,
however, mostly due to plea deals.

I`m joined tonight from Orlando, Florida, by Kaitlyn Hunt, her mother,
Kelly Hunt Smith, and Julia Graves, Kaitlyn`s attorney.

And, Kaitlyn, I want to begin with you, and I know you don`t want to
discuss the details of the case, but having being 34 years old and having
experience being in the midst of a public firestorm with a lot of
attention, I can only imagine how it feels to be going through that as an
18 year old.

HUNT: Very overwhelming. And crazy.

HAYES: Yes.

HUNT: I talked to a lot of people, I try to talk to everybody that I
can, all my supporters across the world and here, and I just try to say
thank you to everybody, especially to my family and Julia for doing
everything they can to help me through this situation.

HAYES: Kelly, there were people at the news conference today wearing
t-shirts that said "stop the hate." And my sense from following this is
that your belief is that the parents of the girl in question called
authorities because this was a relationship between two teenaged girls.

KELLY HUNT SMITH, MOTHER OF KAITLYN HUNT: Yes, that is my opinion.

HAYES: And is there anything that has led you to believe that
specifically?

SMITH: Lots of things, several things. You know, we have a situation
where we have two teenaged girls in a mutual dating relationship. You
know, I`ve had this girl in my home. We had a relationship with her. She
has relationships with my younger children, and --

HAYES: So you knew about it and their parents knew about this
relationship?

SMITH: I can`t speak for them, but I did know about their
relationship, yes. I did not know it had become a physical relationship,
but I did know that they were dating.

HAYES: Julia, there`s people undoubtedly watching right now who are
saying, look, the law is the law and the cutoff in the law exists for a
reason. And if the facts, as presented, are true, then that`s just the way
things work. Why is that not right?

GRAVES: Well, the law is the law, but I think that if we chose to
prosecute everyone who was violating this law, then we wouldn`t even have
room for all the cases in the courthouse. I believe that times have
changed a little bit since the law`s been put into place, and other states
he recognized this, I believe the state of Georgia has reduced this to a
misdemeanor, the state of Wisconsin has set it out on a first offense,
where you attend a class and there is educational counseling for you. And
once you complete that, there are no charges brought against you. I just
believe that the laws of the state of Florida need to be changed. And
unfortunately, we`re here with the law as it is. But we`re hoping that, as
we said earlier, common sense can prevail and we can get both of these
girls out of this without completely destroying them.

HAYES: Julia, what would common sense look like for you? What would
be a fair, just outcome to this situation?

GRAVES: A fair, just outcome for me would be a misdemeanor charge. I
have never once asked the state attorney`s office to just drop the charges.
I understand that what Katelyn did under the law was wrong, and Katelyn did
not understand that at the time, and I don`t believe her parents or anyone
else understood it.

But we put the children in this school together. And we expect them
to behave as children. And then when one of them becomes an adult, then we
charge them with this crime. But what we think would be fair would be a
misdemeanor charge and to have some probation and maybe some education,
community service, and no contact with the victim, if that`s what they
desire, and everyone move on with their lives, where the victim doesn`t
have to live with the fact that she, because of her consensual
relationship, left her girlfriend with a felony. And the charges that are
being offered now, the third degree child abuse, those cannot be sealed
under the State of Florida.

HAYES: That will follow her around for the rest of her life. Kelly,
what have you learned? Has this changed the way you think about the
criminal justice system, having to interface with it in this way?

HUNT SMITH: Oh, absolutely. You know, I did not know. I`m 37 years
old, and not one time did I even consider their relationship illegal or
criminal ever. I have five children. I have five girls. And you know,
they date. I have two older girls, 17 and 18, and they date. I`ve never -
- they are in high school. I didn`t consider it wrong or criminal at all.
So I`m definitely learning a lot of things right now.

HAYES: Attorney Susan Graves, Kelly Hunt-Smith and Katelyn Hunt,
thank you all for your time tonight. I really appreciate it.

(CROSS TALK)

HAYES: Coming up, the one person most clearly to blame for the IRS
targeting scandal. The one person still has a job and is now invoking her
Fifth Amendment right against self incrimination. I`ll have the latest
next.

(COMMERCIAL BREAK)

HAYES: It is not every day you see the head of a major government
agency go before Congress and plead the Fifth. So it was remarkable to see
Lois Lerner, the director of the IRS` Exempt Organization Division, do just
that before the House Government Oversight Committee.

(BEGIN VIDEO CLIP)

LOIS LERNER, DIRECTOR, IRS` EXEMPT ORGANIZATION DIVISION: While I
would very much like to answer the committee`s questions today, I`ve been
advised by my council to assert my Constitutional right not to answer
questions related to the subject matter of this hearing.

(END VIDEO CLIP)

HAYES: The questions Lerner wouldn`t answer were in regard to her
knowledge of the actions of the division of the IRS, which she heads, which
we now know targeted certain conservative groups` application for tax
exempt status for extra scrutiny. Committee Chairman Congressman Darrell
Issa kept trying.

(BEGIN VIDEO CLIP)

REP. DARRELL ISSA (R), CALIFORNIA: Is it possible that we could
narrow the scope of questions and that there are some areas that you would
be able to answer any questions on here today?

LERNER: I will not answer any questions or testify today.

ISSA: Ms. Lerner, would you be willing to answer questions
specifically related to the earlier statements made under oath to this
committee?

LERNER: I decline to answer that question for the reasons I`ve
already given.

(END VIDEO CLIP)

HAYES: All right, so far this IRS scandal has cost a couple of
political scalps. Acting IRS Commissioner Steve Miller was forced to
resign. And he wasn`t even running the IRS at the time employees targeted
Tea Party groups. Lerner`s boss, the IRS commissioner for exempt
organizations, guy by the name of Joseph Grant, who got promoted to his
position, quote, "two days before the agency confirmed the targeting of Tea
Party groups and conservative organizations applying for tax exempt
status," that guy is now retiring.

But for some inexplicable reason, Lois Lerner has managed to hold on
to her job. She`s the one mentioned in the inspector general`s report of
knowing about terms such as Tea Party and patriots being used to screen
some applications for extra scrutiny. After being briefed on the expanded
criteria in June 2011, the director for exempt organizations immediately
directed the criteria be changed. That`s an important passage.

Because in other words, Lerner heard what her subordinates had done,
realized it was not a good idea and ordered them to cut it out, which they
did for awhile, before eventually reverting back to form. And yet despite
the fact that Lerner was the one who instructed agents to stop the practice
that has now caused so much heart burn, she told reporters that she learned
of it from news reports in 2012.

Everyone else who was called before the House Oversight Committee had
to answer questions. Lerner invoked the Fifth Amendment, which is, of
course, her Constitutional right. While her boss and her boss` bosses had
to fall on their swords, the person who seems, from what we know, to bear
the most direct responsibility for this entire mess, the person in charge
of the Exempt Organization of the IRS when they did the thing they should
not have done, she is still there.

Joining me tonight, Pulitzer prize winning journalist David Cay
Johnston. He is a columnist for "Tax Analysts."

David, I think it was the day this story broke, you came on our air
and you said, Lois Lerner has some explaining to do. And I think you even
called for her to resign. Did today change your mind? Do you still have
that opinion?

DAVID CAY JOHNSTON, "TAX ANALYSTS": Lois Lerner had to take the Fifth
Amendment. The attorney general of the United States said she`s under
criminal investigation. And even though I cannot imagine a criminal charge
coming out of this, you have to take the Fifth Amendment under those
circumstances. And Congress should respect the rule of law here. We have
a Fifth Amendment for a very good reason.

Now, that said, Lerner says she did nothing wrong. No, I don`t think
she broke the law. But you know what? She bungled this. She`s an
executive, and she should resign. And she should resign immediately. And
I do not understand why she hasn`t been fired. But she needs to be removed
immediately. Low-level IRS employees accused of minor misconduct have been
rousted from their homes before dawn in front of their neighbors. And this
woman continues in this job.

It is -- she just shows she has no honor. And this comes after she
has been accused of lying by a member of Congress. She lied in the
interview with reporters. And I know another reporter with an impeccable
reputation who has complained to the IRS that she`s lied to her. Lois
Lerner must resign.

HAYES: And the other thing, aside from the fact that she is the
person -- she is the highest level person who figures most prominently in
the I.G. Report. I think that`s a fair thing to say.

JOHNSTON: Yes, it is.

HAYES: She is also the one who cooked up this cockamamie way of
coming clean with this news before the I.G. report, by planting a question
at a tax law conference with a lawyer who she called and said, you should
ask me this question, and at first denied planting the question. We have
the tape of her, actually, the back and forth. Take a listen.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Lois, a few months ago, there were some concerns
about IRS review of 501(c)4 organizations, 501(c)4 applications by Tea
Party organizations. And I`m just wondering if you could provide any
update on any of that.

LERNER: They used words like Tea Party or patriots. And they select
cases simply because the applications had those names in the title. That
was wrong. That was absolutely incorrect. It was insensitive. And it was
inappropriate. That is not how we go about selecting cases for further
review. We select them for further review because they need further
review, not because they had a particular name.

(END VIDEO CLIP)

HAYES: That was May 9th. That was what set this story into motion.
That was how Lois Lerner herself chose to make this public. David?

JOHNSTON: Well, Chris, one of the things that`s astonishing here is
Lerner apparently was acting on her own here. One of the things Congress
should have asked today of Shulman and should have asked of Miller earlier
was about their conversations and about what she was authorized to do. But
Lerner took it upon herself to do this.

And you just can`t bungle something this badly. Now, I want to be
very clear, the IRS has an obligation to investigate. I don`t like your
use of the word target. If you file and request tax exempt status and you
write on your application, we`re going to be engaged in political activity,
the IRS is required by Congress to investigate you. On the other hand,
Congress has also said you can just declare you`re a 501(c)4 organization.
We need to fix that.

By the way, my column in "Tax Analysts" says you can fix this with
eight words. All they have to do is put in section 501(c)4 "exclusively
devoted to promoting social welfare," comma, "and prohibited from engaging
in political activity" -- "election activity."

HAYES: There you go, the solution. Lawrence O`Donnell has been
talking about exclusively as opposed to primarily, as well. Lois Lerner --
you made a great point, David Cay Johnson, as a lover of the Bill of
Rights, we should not criticize someone for the invocation of their Fifth
Amendment rights, particularly when we know they are under criminal
investigation.

That said, her performance, from what we know, does seem to be quite
poor. David Cay Johnston, columnist for "Tax Analysts," thank you very
much.

JOHNSTON: Thank you.

HAYES: Something happened in the Senate that we hardly ever see,
politicians being forced to make an excruciating choice in public. I`ll
tell you what it was next.

(COMMERCIAL BREAK)

HAYES: Last night in the Senate, a really rare and really remarkable
thing happened. During the committee markup on the immigration bill,
senators found themselves basically on stage in front of cameras and a
packed committee hearing having to make an excruciatingly difficult
political and moral choice in real time. And here`s how that happened.

Last night, just as I was preparing to gone on air, as the Judiciary
Committee was finishing up several long days considering amendments to the
Senate`s immigration bill, Senator Pat Leahy of Vermont, the chair of the
Senate Judiciary Committee, debated offering an amendment to the Senate`s
immigration bill that would have allowed U.S. citizens to apply for a green
card on behalf of their same-sex partners, which is something, of course,
most of the Democrats in the committee support in principle.

The problem, as we have discussed on this show, is that this
comprehensive immigration bill is, at this point, basically a Jenga tower.
It is a very, very delicate thing. And one wrong move could bring the
entire thing tumbling down. It`s a point quite explicitly made by Senator
Lindsey Graham in this exchange with Senator Leahy.

(BEGIN VIDEO CLIP)

SEN. PATRICK LEAHY (D), VERMONT: Does the senator see anything in my
amendment that would change, in any way, the right of his state to define
marriage as they want?

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: No, sir, I do not. But I
see in your amendment a requirement by me and others who disagree with the
definition of marriage that you so passionately believe in, and you would
be making me vote on a concept that I think -- you`ve got me on
immigration, you don`t have me on marriage. I just can`t tell you any more
directly. If you want to keep me on immigration, let`s stay on
immigration.

(END VIDEO CLIP)

HAYES: So, responding to threats from Republicans that the Leahy
amendment would kill the immigration bill, Democrats, one by one, took to
the microphone to explain why they were willing to basically throw gay and
lesbians off the boat in order to save it from sinking.

(BEGIN VIDEO CLIP)

SEN. CHUCK SCHUMER (D), NEW YORK: Much as it pains me, I cannot
support this amendment if it will bring down the bill.

SEN. DICK DURBIN (D), ILLINOIS: But I hope that today we can keep
this coalition together and pass immigration reform.

SEN. DIANE FEINSTEIN (D), CALIFORNIA: We now know that this is going
to blow the agreement apart. I don`t want to blow this bill apart.

(END VIDEO CLIP)

HAYES: After realizing that he did not have the support of even his
own party, Senator Leahy withdrew the amendment.

(BEGIN VIDEO CLIP)

LEAHY: So, I will withhold the Leahy Amendment 7 at this point, and I
say this with a heavy heart.

(END VIDEO CLIP)

HAYES: Without the amendment, the bill sailed through the committee,
to cheers and applause, setting the stage for a Senate-wide vote.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Mr. Chairman, the votes are 13 yeahs --

LEAHY: It passes.

(APPLAUSE)

(END VIDEO CLIP)

HAYES: It is in moments like this we are reminded that progress
requires genuinely difficult, heart wrenching compromises. And the
senators in that committee who shot down the humane and justified,
enlightened Leahy amendment, even though it pained them, those senators did
the right thing. And Senator Leahy did the right thing by withdrawing it.

I`ll explain why and talk to someone who definitely does not agree
when we come back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SCHUMER: Much as it pains me, I cannot support this amendment if it
will bring down the bill. I`m a politician. And that means I have chosen
my life`s work, within the constraints of the system, to accomplish as much
good as I can. I accept the tough choices and the painful, but necessary
imperfection of compromise, which is at the heart of our system of
government.

(END VIDEO CLIP)

HAYES: We`re talking about the landmark immigration reform bill that
passed a major hurdle in the Senate at the expense of a provision that
would have protected gay a lesbian couples. Joining me now, Marielena
Hincapie, executive director of the National Immigration Law Center, and
Felipe Sousa-Rodriguez, co-director of Get Equal, an LGBT advocacy group.

And Felipe, since you don`t agree with my reading of the politics on
this, why do you think Democrats were wrong to kill the Leahy Amendment
yesterday?

FELIPE SOUSA-RODRIGUEZ, CO-DIRECTOR, GET EQUAL: They had a false
choice. Their choice was to either cement discrimination into immigration
law or to change the system that has been wrong from the very beginning.
We`re talking about comprehensive immigration reform, and we should
comprehensively change laws that harm people in real life and real time.

HAYES: Do you reject the political notion that adding this would have
made the bill politically untenable when it got to the full Senate?

SOUSA-RODRIGUEZ: Oh, yes. Look, Chris, I`m undocumented myself. I
came to this country when I was 14 years old because my mother was sick. I
grew up in this country. But I`m also gay and fell in love with someone
whom I married. And when I decided to marry that person, my straight
counterparts can really easily get a green card, while my partner can`t
petition for me.

And you know, we have Senator Collins, Senator Kirk, Senator Hagen,
Senator Tester, several other senators that did not vote for the DREAM Act,
voted for the repeal of Don`t Ask, Don`t Tell. You know, these are people
who believe in the LGBT cause. And they don`t necessarily -- are with us
on immigration. They could have been with us if you have those included.

HAYES: That`s interesting. Marielena, part of this strikes me, also,
a bit of hedging by the Senate because the DOMA decision, the Defense of
Marriage Act decision will come back from the Supreme Court. If, indeed,
the Defense of Marriage Act is struck down, in some ways that will solve
the problem -- largely solve the problem because people that are married in
states that legally recognize same sex marriage will not have the -- won`t
have the federal government second guessing them, right?

MARIELENA HINCAPIE, NATIONAL IMMIGRATION LAW CENTER: That`s true,
Chris, but only for those states that do recognize same-sex marriage. I
think yesterday`s vote was an extremely difficult one. We were all at edge
of our seat knowing that Senator Leahy -- wondering whether Senator Leahy
was going to offer the bill. It was a very solemn moment, a very rare,
candid discussion among all of the senators.

And unfortunately, Senator Leahy had to pull it and didn`t offer it up
for a vote. I think Senator Leahy has been the voice of consciousness
throughout this entire markup. He took some very difficult votes.

HAYES: But do you think they did the right thing? Was that the right
call? Did the Democratic senators in that room make the right political
choice to kill something that they all said they believed in, because they
thought it would kill the bill politically?

HINCAPIE: I think they feel they made the right choice yesterday. I
don`t know that that ultimately is the right choice in history. I think,
as Senator Leahy said, 50 years from now, our grandchildren will look back
and say, how did this discriminatory law stay as part of our immigration
law. That said, though, this is a very complex immigration law -- the bill
is very complex. And it`s -- we`re going to be -- this is just one of many
difficult choices, many difficult votes that will have to be made
throughout the next months.

HAYES: Felipe, I think one thing I thought -- again, my read of the
politics -- and I could be completely wrong about this. My read of the
politics is that that really would have been a poison pill, which is why I
think they made the right call, because I really do want to see this bill
get across the finish line.

To argue against myself for a second, it does strike me -- the next
question you asked is, if the Democrats were willing to compromise on this,
what else are they willing to compromise? And have they set themselves up
in a position where they now have a much weaker hand going into this? Is
that something you worry about, Felipe?

SOUSA-RODRIGUEZ: Well, yes. Honestly, they already compromised
communities that live at the border, who have drones flying over their
house every day. They compromised people who had sisters and siblings
across the world trying to reunite with their family. And they compromised
same-sex couples yesterday.

Every day, they are compromising a different thing. The bill is
getting weaker. And we have, as a progressive movement, to stand up to the
bigotry of the Republican party. Today -- yesterday, there was a poll that
came out of Florida; 67 percent of voters in the state of Florida support
the inclusion of same-sex couples in immigration reform. We should be
pushing Senator Rubio, not accepting his arguments.

HAYES: Marielena, do you agree with that? What Felipe just said
there is an important point. He said every day the bill is getting weaker.
Do you feel that`s the case?

HINCAPIE: Not exactly. Coming out of the markup yesterday, it was a
very, very historic vote. The markup actually showed us that the Senate
Gang of Eight -- and I will continue to call them gang members -- that they
stuck together. They were actually able to defeat the worst amendments
that had been offered. Many amendments actually weren`t offered up for a
vote. And in fact, we were able to get many affirmative, positive
amendments through.

So I think, at the end of the markup, the bill has been mostly
unscathed, slightly improved. That said, there are actually a lot of
problems in the base bill, as Felipe mentioned. For example, the fact that
the sibling category has been eliminated, the fact that diversity visas
were struck, the fact that LGBTQ binational partners aren`t able to
petition members out of yesterday`s vote, many of those things. And there
will continue to be tougher votes.

HAYES: Quickly, Felipe, you going to get another shot at this, do you
think?

SOUSA-RODRIGUEZ: You know, I wanted to just finish by saying that
267,000 undocumented people identify as LGBT. So they will continue
fighting for a pathway to citizenship and some good provisions like the
elimination of detentions and et cetera. So what`s really important here
is that we cannot cement discrimination into law.

HAYES: Marielena Hincapie of the National Immigration Law Center,
Felipe Sousa-Rodriguez of Get Equal, thank you. That is ALL IN for this
evening. "THE RACHEL MADDOW SHOW" starts now. Good evening, Rachel.

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

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