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'The Last Word with Lawrence O'Donnell' for Wednesday, August 14, 2013

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August 14, 2013
Guests: Marc Ginsburg, Greg Louganis, Nick Confessore

LAWRENCE O`DONNELL, HOST: The Egyptian government announced the state
of emergency tonight.


RICHARD ENGEL, NBC NEWS: Frontline positions between the protesters
and security forces all over Cairo.

UNIDENTIFIED FEMALE: We begin with the violence in Cairo.

UNIDENTIFIED FEMALE: Egyptian security forces used live ammunition
and tear gas.

UNIDENTIFIED MALE: This began with the police attempting to break up
the sit-ins.

UNIDENTIFIED FEMALE: Four of the protesters have been arrested.

UNIDENTIFIED MALE: You have the resignation of the vice president.

UNIDENTIFIED MALE: This was already an embattled interim government.

CHRIS JANSING, MSNBC ANCHOR: Now, we have a state of emergency.


UNIDENTIFIED MALE: This is the scenario panning out.

JANSING: It has already been a busy morning. Lots of breaking news.

UNIDENTIFIED FEMALE: The hostage standoff in rural Louisiana ended

UNIDENTIFIED MALE: Mr. Weiner should step aside for the good of the

UNIDENTIFIED MALE: Today, I manned up and tried to accept
responsibility for the error of my ways.

REINCE PRIEBUS, RNC CHAIRMAN: We have to be a party that promotes a
positive plan for the future.

UNIDENTIFIED MALE: We switch topics to making it happen.

UNIDENTIFIED MALE: The RNC is kicking off its summer meeting.

JANSING: You talk about techniques and strategies.

PRIEBUS: Talk about cheerful persistence.

UNIDENTIFIED MALE: What do we expect to hear from them?

PRIEBUS: The party that gets on television and puts a smile on your

UNIDENTIFIED MALE: They`re going to hear from Newt Gingrich today.

NEWT GINGRICH (R), FORMER HOUSE SPEAKER: The ability to repeat the
lesson you don`t understand is at the heart of effective learning.

PRIEBUS: We haven`t decisively won a presidential race in 24 years.

UNIDENTIFIED MALE: There is some other developing news out of

UNIDENTIFIED MALE: Where did the airplane actually crash?

UNIDENTIFIED MALE: The massive UPS cargo plane crash.

JANSING: It is already a very busy morning, lots of breaking news,
but we begin with the violence in Cairo.


O`DONNELL: Egyptian security forces killed at least 200 people today
in a crackdown against protesters supporting the ousted president, Mohamed
Morsi. Many more are wounded and more than 2,000 injured. There is a
government-enforced curfew in Cairo. And tens of Egypt`s provinces and the
interim government declared a one-month state of emergency across the
country, suspending the right of trial or due process.

Secretary of State John Kerry condemned the violence.


JOHN KERRY, SECRETARY OF STATE: The path to violence leads only to
greater instability, economic disaster and suffering. The only sustainable
path for either side is one towards a political solution. I am convinced
from my conversations today with a number of foreign ministers, including
the foreign minister of Egypt, I am convinced that that path is in fact,
still open. And it is possible, though it has been made much, much harder,
much more complicated by the events of today.


O`DONNELL: NBC News` Richard Engel is in Cairo and joins me now.

Richard, has the curfew that has been imposed restored order? And
what happens when the curfew is lifted in the morning?

ENGEL: Cairo has a very odd feeling right now. Our bureau, which is
where we are doing this report, is right on the Nile. And normally it is
full of boats, people going back and forth. Traffic, this is a city of 18
million people. You could hear a pin drop here tonight.

That is not the case in several of the more rural areas where people
have been going out, openly defiant of the curfew, holding protests in
favor of the ousted president, Mohamed Morsi.

Tomorrow, the curfew is expected to expire. It is not clear if there
will be more violence. There certainly will be more clashes, but the real
concern is what will happen on Friday. Friday, traditionally the day of
prayers, when people come out, express their emotions. I expect that there
could be demonstrations on Friday. And that could be another round of

Perhaps not like the round we saw today, but it could be more. I
don`t think this country is out of the woods yet.

O`DONNELL: Richard, how much warning was there that this crackdown
was coming?

ENGEL: There was really no warning. There was and there was not.
There was warning because the government has been talking vaguely for weeks
about no longer being tolerant of the Muslim Brotherhood. That it would
push away the camps, and then backed away from it.

And then as early as last night, and even this morning when you woke
up to the newspapers and opened the newspapers here, they said there will
be no crackdown, that there are still going to be negotiations. And that
is what people thought when they woke up in Cairo this morning until they
saw the troops and police roll in.


ENGEL (voice-over): Egypt is unraveling. It`s hope of democracy
obscured behind tear gas and bullets.

At first light, Egyptian security forces which ousted the elected
president six weeks ago moved in to finish the job. And break-up two camps
of protesters who demand the former president be reinstated, bulldozing
into one at Cairo University. It was over quickly.

But at the other protests, they held fast. Security forces fired on
them, with tear gas, and then automatic weapons.


ENGEL (on camera): Egyptian security forces here are firing into the
side streets. The front line positions between protesters and security
forces all over Cairo. And this one looks like it`s about to get very

(voice-over): Adel Sanik (ph) 37-year-old customs broker, guided us
through the streets, warning of government gunmen. Already two journalists
had been killed.

UNIDENTIFIED MALE: Even if you won`t take a shoot, take a cover to
take the picture.

ENGEL (on camera): Why? There are snipers trying to shoot?


ENGEL (voice-over): Sanik says he came here because he believes his
vote was stolen.

UNIDENTIFIED MALE: We`re fighting for principle, for the president we
elected. OK? Doesn`t matter who --


ENGEL: They showed us a field hospital, chaotic and grim.

(on camera): It`s impossible to know how many people have been
injured, let alone killed today. This man was shot in the upper thigh with
a live round. Some of the injured are being taken to ambulances and
hospitals. Others are just being treated on the ground.

(voice-over): But there is more to the story. Police uncovered
ammunition hidden in coffins in a protest camp. And video from an Egyptian
newspaper shows demonstrators armed and firing.

Protesters pushed an armored vehicle off a bridge. Five soldiers were
inside. Today may be just the beginning. Islamic extremists who backed
the Muslim Brotherhood burned churches and attacked government buildings

Egypt`s military-backed government, a close U.S. ally, today chose to
try to crush the Muslim Brotherhood. It`s unclear if the iron fist will


O`DONNELL: Richard, does the Egyptian government have a next move?
Or are they just going to try to impose their will as a result of the state
of emergency?

ENGEL: Well, I think they are going to try and impose their will.
You have to also understand, this is part of an 85-year-old battle between
the Egyptian military, the nationalist state and the Islamist Muslim
Brotherhood. This has been a deadly battle. Today was a very violent

The Muslim Brotherhood was banned for decades. It was banned under
Nasser. It was oppressed under Nasser. It was oppressed under Mubarak.
And Mubarak left, suddenly, they rose to power.

And now, you saw the Egyptian military and the Egyptian government,
which is backed by the military, moving in and pushing out the Muslim
Brotherhood. And I think we are going to see a continuation of this kind
of policy where the brotherhood is considered now an illegal organization.
It has been described in the Egyptian media as a terrorist organization.

There is a ferocious media campaign under way on state television and
the state newspapers to discredit the brotherhood. And I think you`re
going to see that campaign playing out over this next month, now that they
have a state of emergency in place, which means they can arrest people.
They can put people -- they can do more searches and seizures in people`s
homes. They can detain people for longer.

And I think it would be very clear that there is going to be a
campaign against the Brotherhood.

O`DONNELL: Richard Engel, thanks for joining us tonight with your in
valuable and brave reporting. Thank you.

ENGEL: My pleasure.

O`DONNELL: Joining me now is Richard Wolffe, executive
editor and former ambassador, Marc Ginsburg, a former Middle East policy
adviser to President Clinton.

Ambassador Ginsburg, what -- how can the United States find its way
through the crisis period?

Actually, the only way is with other allies, because the United States
standing with the dominant force in Egypt, the military and General Sisi,
who heads up the -- for all intents and purposes, the government who
ordered this crackdown, has publicly ridiculed the United States
government, had dismissed the efforts to try to mediate the emissaries,
Senator McCain and Graham were sent packing by the Egyptian government and
they were, in effect, told not to return.

So, the standing of the United States right now on a bilateral basis
is about as low as it can get.

O`DONNELL: Let`s listen to what John McCain and Lindsey Graham said
about this a couple of weeks ago.


SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: Oh, my God. I didn`t know
it was this bad. These folks are just days or weeks away from all-out

UNIDENTIFIED FEMALE: Do you think Egypt might fail?

SEN. JOHN MCCAIN (R), ARIZONA: I think it might. I think -- I
wouldn`t be here if I didn`t think that it might. And I think the events
in the next few weeks will determine that.

GRAHAM: I`ll go a step further, I think it is going to fail if
something doesn`t change. And to the American people, failure in Egypt
matters to us.


O`DONNELL: Richard Wolffe, there they were in Egypt. And they
certainly had the feeling this was coming.

And Richard Engel has been very foresighted in his reporting, as well. You
know, losing Egypt is not a small thing for any administration. And
certainly for the Obama administration looked at the Egyptian situation
when it was first a sort of relatively simple question of the ousting of
Mubarak. And they said they wanted to be on the right side of the

What you`re looking at now is a situation which although it`s not as
bad in Syria, in terms of the policy options are similar in the sense that
the choices are between the bad side and the worst side. And the moral
clarity of the Hosni Mubarak choices has completely gone here. It is a
very, very difficult set of choices for the Obama folks.

O`DONNELL: Ambassador Ginsburg, one of the difficult choices, or
maybe today, not so difficult, is what to do about the continued flow of
aid from the United States to Egypt.

GINSBURG: Well, indeed. But let`s be clear here. The $1.3 billion
and a threat of revoking either under the guise of declaring what the
military did as a coup, or to revoke it as a result of these clashes that
are taking place, that didn`t seem to dissuade the military from acting.
And let`s also understand that our leverage because of that aid is minimal.

And among those of us who understand the dynamics of what we call real
politic in the Middle East, there is significant Egyptian popular support
for what the government has done here. So let`s understand that.

Secondly, it`s important to also understand that from a geo-strategic
perspective, we need the Egyptian military more than the Egyptian military
needs the United States aid right now. And if we don`t provide that aid,
the Qataris, the Egyptians, the Kuwaitis will step in pretty quickly to
fill that void.

O`DONNELL: Ambassador, could you explain why we need the Egyptian

GINSBURG: Largely because of the role that they played in helping to
quell the violence in the Sinai. Their counterterrorism support in north
Africa, the stability they represent to the Israelis in protecting the
integrity of the Camp David peace treaty with Egypt. These are very
essential elements of a government that led by the military will also wind
up standing up to Iran and supporting us in Yemen against al Qaeda.

So the Egyptian military plays a very important role for the United
States in the Middle East and we cannot lose sight of that.

O`DONNELL: Richard Wolffe, I read a comment by somebody in Egypt
today who is actually on the Morsi side of this protest. But saying that
he believes that the way it works for the Western government, especially
the United States, is that in the end they side with the winners.

WOLFFE: Well, that is true. And they side for stability.

You know, this is a pattern for the United States, supporting a degree
of democracy and then actually deciding that a democracy is too mess, you
only have to look at the recent history in Gaza, where the Bush
administration supported elections there, decided that the outcome wasn`t
to its liking and didn`t much like democracy after that.

This is a very similar pattern. It was entirely predictable. And the
hard thing for the politics is that just where the Morsi opponents were
gaining traction, now you have these kinds of massacres where the politics
becomes even messier. How can a foreign government negotiate its way
through that? Not just directly, but with those foreign -- foreign
populations, it is extremely hard.

O`DONNELL: Ambassador Marc Ginsburg, and Richard Wolffe, thank you
both for joining me tonight.

GINSBURG: Sure. Good to be with you.

O`DONNELL: Coming up, Olympic gold medallist Greg Louganis will be
here discussing Russia`s anti-gay laws and the Olympic Games.

And, the Republicans are still trying to re-brand themselves. And
today, for some strange reason, they tried to do it in the very same Boston
hotel where Mitt Romney delivered his concession speech in the last
presidential election.


O`DONNELL: In 1943, Rosanell Eaton was 21 years old when she became
one of the first African-Americans in her North Carolina county to be
allowed to vote. She had to recite the preamble to the Constitution before
she could register.

Now, under the new North Carolina voter ID law, she may not qualify
for the ID card needed because the name on her 92-year-old birth
certificate and her driver`s license are different. Rosanell Eaton has
filed a lawsuit against the new North Carolina law, as has the ACLU.

North Carolina Senator Kay Hagan yesterday asked the Justice
Department to conduct a formal review of the Voting Rights Act.

Up next, the Republicans went to the original location of the Tea
Party today to try to see their future.



PRIEBUS: If we can do the right thing and if we can stay unified as a
part and present a clear alternative to the Democrats as far as where this
country needs to go, in a reasonable, intelligent, cheerful way.


O`DONNELL: That was the chairman of the Republican Party dreaming out
loud today about the Republican Party that he would love the lead, a
Republican Party that would make his job a lot easier. Reince Priebus did
his public dreaming in Boston today, in a very same hotel where Mitt Romney
discovered he was never going to be president on election night in 2012.

Newt Gingrich headlined a luncheon at the meeting where he offered
this advice to Republicans, which of course, Republicans have no chance of


GINGRICH: We have to get beyond being anti-Obama, and we have to
convince people you can have hope in America.


O`DONNELL: Joining me now "The Washington Post`s" Eugene Robinson and
MSNBC`s Abby Huntsman.

Abby, you understand these Republicans better than I do.

ABBY HUNTSMAN, MSNBC`S "THE CYCLE": I`d try my best, Lawrence. It`s

O`DONNELL: They must have gotten a fantastic deal on that hotel to
decide, let`s go to Boston, which like in its history has never voted
Republican, certainly not in my lifetime voted for a Republican for
president. And let`s go to the hotel where Mitt Romney had to face his
loss. Let`s just drink in the misery of that hotel as we try to figure out
how to what, the Mitt Romney party anymore? What were they doing in
Boston? I don`t get it.

HUNTSMAN: I don`t think anyone wants a deja vu quite like that, but I
think some of their thought processes were, they thought about this meeting
during the Boston bombing. Interesting thought, though, from Reince
Priebus about staying unified. I think that is the exact problem f the
Republican Party.

Look, nobody should expect come Friday for a new, reinvigorated, re-
energized, united party. I think this is very much business as usual.
This is their annual summer meeting. What they`re really focusing on is
two areas of progress. You have technology and you have voter outreach,
both of which are very important. I mean, Republicans have lagged pretty
far behind Democrats over the past two election cycles in both of these

But look, you can have the best voter outreach of any organization.
You can have the best Twitter feed. But if you don`t have a cohesive
message, if you don`t have an identity, if you don`t have a narrative that
can speak to those in the party, I think that is the problem.

So I don`t think that will even matter at the end of the day. And
that is the biggest challenge for the party. I can`t tell you how many
times I get asked, not only are you Republican but which part of the party
do you align with? Do you align with the Tea Partiers, do you align with
the libertarians, do you align with the establishment? Are you a moderate

I mean, that is the problem today and I hope Chris Christie, who is
headlining the lunch tomorrow speaks a little bit to this, because that is
going to continue to be their challenge, not voter outreach and not

O`DONNELL: Eugene Robinson, do you have a time limit as to when the
Republican Party will get beyond as Gingrich put it, get beyond being anti-

EUGENE ROBINSON, THE WASHINGTON POST: Well, let`s see, what`s the
date when President Obama leaves office?

O`DONNELL: Yes, somewhere around there.

ROBINSON: And I`m betting not even then.

O`DONNELL: Right, right.

ROBINSON: Look, you know, this is like a journey, this segment is a
journey to some fantasy land, because listen to Reince Priebus` list of
wishes, you know, the Republican Party does not have an alternative to
present. It is not unified. And it certainly is not coming across to
voters as cheerful or reasonable or any of the things that he said.

So maybe he wants to be chairman of some other party. But that
doesn`t sound like the party he`s got.

O`DONNELL: Yes. I mean, his description is exactly right. I mean,
those adjectives are what you would want your political party to be, but it
ain`t where they are.

Let`s listen to something New Gingrich said in reaction to the federal
judge`s ruling on stop-and-frisk.


GINGRICH: Judges who are totally safe can make really stupid rulings,
and the number one group that will get killed are black males. The number
two groups that will get killed are young Latino males. And so, I think
you can have a very positive campaign on public safety. And you can word
it in a way that it really relates to people who are in deep pain who have
no one who will talk for them.


O`DONNELL: Abby, that`s Newt Gingrich suggesting that the Republicans
can speak for young black men who are threatened by both crime and stop-
and-frisk policies.

HUNTSMAN: What you are seeing from Newt Gingrich who actually came
out in support of Attorney General Eric Holder actually. It`s a side of
Newt Gingrich that I haven`t seen before. I think he is trying to speak to
a message that is more progressive, that maybe it is more appealing to the

The problem is Newt Gingrich has been around for a very long time and
this is a message we haven`t seen from him before. Now, I think he`s doing
his best.

You have to remember, Republicans are really in a very tough. We`re a
very fragile party. The minute you say anything along the lines of trying
to be more moderate, I think people are very quick to judge. It`s going to
take some time for us to be taken seriously.

And Newt Gingrich, you know, give him a little bit of credit. He is
trying there. But it is a tough position to be in.

O`DONNELL: Now, Gene, I promised you I would show you video of any
other Republican up there in Boston today even trying to think new thoughts
and phrase new sentences the way Gingrich always does. But Newt Gingrich
was the thought leader of the Republican Party 25 years ago. They have
long gaps between thought leaders, apparently.

ROBINSON: Well, I guess they do. I agree that you got to hand it to
Newt. He keeps throwing them out there.

O`DONNELL: He does.

ROBINSON: And eventually he will take every side on every issue that
you could think of. But look, the alternative to Republican orthodoxy
right now is Rand Paul. And the Rand Paul wing of the party, the more
libertarian wing of the party that has ideas, many of the rest of the
Republican Party considers dangerous and wrong and even disastrous.

So they`re not quite ready to present that as the alternative yet.
It`s going to take this party a while.

HUNTSMAN: I think -- you`re exactly right. Until you have somebody
leading the ship, I don`t think Reince Priebus is the right person to be
doing that. Until you have someone that actually can bring the party
together and lead them forward, I don`t think you`re going to see much
change for a period of time.

O`DONNELL: Abby Huntsman, and Eugene Robinson, thank you both for
joining me tonight.

ROBINSON: Thank you.

O`DONNELL: Coming up, Rush Limbaugh is finally thrilled by something
in "The New York Times", a front page story today about the problems in the
Clinton family foundation.

And next, Olympic gold medallist Greg Louganis will join me to talk
about Russia`s anti-gay laws and the 2014 Olympics in Russia.


O`DONNELL: The spotlight tonight, Russia`s anti-gay laws and the 2014
Winter Olympics. This week, Russia`s interior ministry confirmed that yes,
Russia`s new anti-gay laws will be enforced during the Winter Olympics.

The International Olympic Committee said last week that they were
asking for reassurance from the Russian government that the anti-gay laws
would not be enforced during the games. Having failed to get that
reassurance from the Russian government, the International Olympic
Committee now seems to be issuing a veiled threat of its own to athletes.

"The IOC has a clear rule laid out in the Olympic charter which states
that the venues of the Olympic Games are not a place for proactive
religious demonstration. This rule has been in place for many years and
applied when necessary."

Olympic diver Greg Louganis who won medals, including four golds in
the 1974, 1984 and 1988 Olympic Games did not compete in the 1980 Moscow
Olympic Games because the United States boycotted in protest of the Soviet
Union`s invasion of Afghanistan.

Joining me now, Greg Louganis. Here we are again.


O`DONNELL: Russian Olympic Games, another big problem.

LOUGANIS: Yes, you would think that the IOC would learn its lesson.

O`DONNELL: Yes, and listen, I`m concerned about that statement from
the IOC. Because I want to show what happened at the 1968 Mexican Games,
which a lot of people will remember. I think we have a picture of Tommy
Smith and John Carlos, just raising their hands. And they were punished
for that. They didn`t say a word. And that was considered by the IOC some
sort of political demonstration. They were not stripped of their medals.
But their credentials were taken away. They had to leave Mexico City right
away. What is the IOC going to consider a political speech in this case?

LOUGANIS: I have no idea. But also in the Olympic charter, the
principles six is anti-discrimination. And it is very clear, you know.
So, what we are asking them to do, the athletes allies and the all out, is
to follow the charter, you know, follow your own charter. And then,
principle 15 is to educate about various cultures. And I`m sorry, I come
from a culture of free speech. So you know, it is really absurd. I mean,
we won`t know until we get there.

O`DONNELL: Well, I mean, let`s assume that the situation was where
there is a gay, an American athlete who is gay, who is married, wins or
doesn`t win and just competes. And afterwards, he decides as many of them
do, many athletes do, to kiss his spouse. Is that a suspendable (ph)
offense in the IOC`s eyes as a sort of political statement?

LOUGANIS: I have no idea, I`m not the IOC.

O`DONNELL: But aren`t they kind of creeping up towards that here?

LOUGANIS: It really is. I mean, it is sort of trying to manipulate,
you know, people`s behavior. But you know, what we are saying, I mean, is
you know, you have to follow your own charter, you know. And it does state
very clearly, you know, to not discriminate which these new laws do. I
mean, they single out LGBTQ individuals, and our youth.

And the thing that I`m concerned about is, I mean, there are gay kids
born in Russia every day, you know. And you know, if we don`t have a
presence there, I mean, what kind of message is that sending those gay
kids? You know, we have Johnny Weir who is out and open about who he is.
We have Blake (INAUDIBLE), from New Zealand, short track speed skater. He
is out and open who he is, you know. There are, you know, walking
propaganda as it were. You know? But you know, they are individuals. I
mean, where is the IOC going to stand up and stand up for them.

O`DONNELL: And what about -- the IOC seems to be concerned about
nothing but don`t bother our athletes. They seem to be absolutely no
concern about what happens to Russian gay people the day before the
Olympics arrive, and the day after the Olympics leave.

LOUGANIS: Well, that is reason why we are really pushing in athlete
ally, is to, you know what, IOC wake up. I mean, you have an opportunity
in September when you, you know, designate who the next Olympics are going
to be going to. And I know Madrid, Spain is one of the candidates, you
know. And they are very open and very, you know, accepting. And so, you
know, do the right thing. Take the Olympics so where the Olympic ideals
and the Olympic movement can thrive.

O`DONNELL: There are two candidates running for president of the IOC
who have said this is a serious issue and we have got to deal with that.
It seems like this is the kind of thing has never really arisen when they
are in the process of choosing a president for that organization.

LOUGANIS: Well, I mean, it is, you know, it is a very important, you
know, specially for all the athletes, for American citizens, for all over
the world, you know. It is unfortunate, you know, that we have had the
Olympics where, you know, we were in Beijing. They don`t have the greatest
human rights history, you know. So, you know -- and here, mean, it is so
blatantly staring us in the face of the violence that is happening to the
LGBTQ kids in Russia, you know. It is just disturbing, you know.

O`DONNELL: Gregory, are you still accepting congratulations on your
Olympic medals? Because I`m a little late. Congratulations for that and
thank you very much for joining us tonight on this important subject,
really appreciated.

LOUGANIS: My pleasure.

O`DONNELL: Coming up, in the rewrite, the dark ages of science in


O`DONNELL: A conservative group that wants Obama care defunded is
trying to convince Republican lawmakers that shutting down the government
won`t hurt the congressional candidates in 2014. The Heritage Action for
America poll showed that 60 percent of voters favored a temporary slowdown
in nonessential federal government operations if the president would agree
to at least slow the implementation of Obama care. But 52 percent of those
people polled actually favor keeping Obama care. That kind of voter
confusion has made it difficult for Republicans like Tom Cole to explain to
his constituents what shutting down the government really means.


REP. TO COLE (R), OKLAHOMA: We will see what happens in September
when we get back. But my instinct is you won`t win that fight. That it
won`t be popular. It never poll`s popular. And what do you tell the
people you`re inconveniencing? Most of the people are not thinking, why
would you shut down the national weather service and just save a whole lot
of lives, by giving a 16-minute warning instead of two? You know, why
would you put 16,000 families out of work at Tinker Air Force Base? They
are performing important national defense, why would giving this country
everything they possibly had in its darkest moment. And say, "Sorry, there
is not going to be anybody here showing up to fix your meals or look after
you or do the commitments we made." I don`t think you usually achieve your
end. I think they wonder why you did that to them.


O`DONNELL: Up next, a special guest rewrite.


O`DONNELL: In tonight`s rewrite, the dark ages of science in America.

On the first floor of Jordan hall at the University of Virginia School
of medicine, there is a room with four incubators attached to six tanks of
carbon dioxide. Sam Stein takes us to that room today in a vividly
reported piece in "the Huffington Post" that is mandatory reading for
anyone concerned about the state of scientific progress in this country,
and therefore, the world.

Inside these incubators, Doctor Anindya Dutta stores cell cultures
that he believes holds the key to a massive advancement in health care. He
has identified the specific strands of the microRNA, the molecule that
plays a large role in gene expression that are responsible for promoting
the formation and fusion of muscular tissue. The implications of such
discovery are tantalizing. People who suffer from diseases like muscular
dystrophy would have easier treatments.

If you can find ways to manipulate this muscle differentiation
process, it would do a huge amount for human health, Doctor Dutta says.
The biggest problem going forward for Dr. Dutta, it is not the challenge of
this extraordinarily difficult laboratory work, the problem is paying for
his research.

Dr. Dutta told Sam Stein, I am living off fumes.

Joining me now is MSNBC contributor Sam Stein.

Now, Sam, as you know, the rewrite is a segment of the show I usually
do alone. But when I read your piece this morning, I thought it was so
important we needed to get it in the show tonight. And we are going to
need your help with it.

Tell us why scientific research like this in this country is not being
funded at the levels it needs.

SAM STEIN, MSNBC CONTRIBUTOR: Well, first of all, thanks for doing
this segment.

Science has been de-prioritized because of sequestration. In 2002,
George W. Bush made a commitment to double the national institute of health
budget in five years time. Now, we are back at 2007 levels because of
sequestration. Sequestration took a $1.7 billion cut from the NHA budget.
It reduced about 750 grants that the NHA could have given to scientists
across the country.

And basically, you`re left with the potentially promising projects
like the one that Dr. Dutta is doing at the University of Virginia. They
are left without any funding streams. When he initially applied for the
grants. It was rated in the top two percentile in 2007. That means at 98
percent of all projects, he bested them. This time around he can`t get
funding. And what we are going to end up happening is that in ten year`s
time, we are going to see the consequences of stuff like this because you
don`t see how the cuts manifest themselves in the next year or so. It is
when we don`t discover the cure for diseases that we end up seeing the
cost. And it is going to be a bad economic investment as well because
health care cost that could have been avoided to going to be incur because
of the lack of scientific breakthroughs.

O`DONNELL: Sam, you have committed yourself like no one else in
Washington to covering what is really happening in sequestration in these
stories that most of us can go through our lives without having any
awareness of or having the no impact in our lives of this sequestration. I
kind of deliberately kept the word sequestration away from the subject
until now because I wanted people to be drawn into what is really happening
here. And this kind of untold story, except by you, of what is really
happening with sequestration in this country now.

STEIN: Yes. Well, sequestration is a very wonky budget word. It
turns people off.

O`DONNELL: Well, Sam, let me just say, it has been until you started
reporting on the real human effects of it. And the story you tell today
about what is happening in the laboratories and the way some of these
experiments are closing up is very vivid.

STEIN: Thank you. And I think part of the reason that we don`t hear
more about it is because, as I have said, a lot of the costs are not being
felt in real terms. So, another thing that is happening with science cuts
is that a generation of young scientists or PhD students are not going to
enter the field or they are going to go to other fields or they are going
to go to other countries.

I talked to a aids researcher who has been doing amazing work at
George Mason University whose lab is going to be closed. And he said he is
talks to people in China because he wants to continue his work. This is a
guy who is going to be doing cutting edge research on how HIV viruses
communicate, and essentially, trying to find a cure for HIV viruses through
a molecule found in soybeans. And it has been noted (ph) in various
scientific journals, we are not funding him.

And so, what he is going to do is he is going to take his workings.
He is going to move it to China. All the researchers on this project are
going to go with him or they are going to elsewhere. And so, the costs
that we are not seeing aren`t there right now but they are going to be
there in few years time when we have a generation of would-be scientists
who are working in Germany or China or elsewhere.

O`DONNELL: And real science can`t fit itself within the budgetary
windows of appropriations bill, it is a 12-year windows. Real science
stake takes years. They have to know there is going to be a steady stream
for this range of experimentation that they are trying to covers a period
of years.

STEIN: It takes years and it also takes risks. One of the
interesting pushback on my article today come from some people in science
community who say well, you know, NHA`s budget is still at $29 billion.
That is a lot. It is more than what any other country invests.

But the problem with that saying, if you want to continue to lead in
investing -- If America wants to continue leading the investment in
science, they have to continue to grow their budget. And if we cutting off
the amount of projects that we end up funding, then we are not going to
find that sort of needle in the hay stack or that thing that will make huge
medical advancement. So, you have to spread the investment wider.

O`DONNELL: Not the mention with the research gets more expensive
overtime for variety of reasons including the new technology, these

Sam Stein, very important report. Thank you very much for joining me
tonight and rewriting America`s idea about what is really happening in

STEIN: Thank you.

O`DONNELL: Coming up. The "New York Times" reporter who co-wrote
today`s front page story on the problems of the Clinton family foundation
will join me.


O`DONNELL: Allison Jenney has finally joined twitter, the real White
House secretary wasted no time in tweeting the only winning White House
press secretary.

Welcome to Twitter, AlisonBJenney. Can you teach me how to do the
Jackal to which Alison replied, thank you for such a lovely welcome. I
would be happy to give the Jackal tutorial in the press briefing room.

The jackal is, of course, the song Alison Jenney lip synced in season
one of NBC`s the West Wing. Here is what Jay Carney wants to learn.


O`DONNELL: Four Emmys in that part for Allison Jenney. Up next, a "
New York Times" report on problems of the Clinton family foundation.



Times" Web site is still down. It has been hacked. I think it is a safe
bet to say that the reason the Times has been hacked is that they have a
story that exposes the Clinton global initiative, the Clinton charity. It
exposes it as something really wrong with this thing, is their point.


O`DONNELL: That was Rush Limbaugh`s wild interpretation of a front-
page times report on "the New York Times" today on the Clinton foundation.
The Times reports on how quote "the foundation tries to juggle the
political and philanthropic ambitions of a former president, potential
future president and their increasingly visible daughter.

The Times reports that the foundation ordered a review of its own
activities and functions which was conducted by New York law firm of
Simpson Thatcher (ph) and Mark Lip (ph). According to "the Times," law
firms review found that for all its successes, the Clinton foundation had
become a sprawling concern, supervised by a rotating board of all the
Clinton, hence, vulnerable to destruction and threatened by conflicts of
interests. It ran multi-million dollar deficits for several years, despite
vast amounts of money flowing in.

That 2011 review set in motion, a series of changes inside the
foundation in preparation for Hillary Clinton and her team to literally
move into the foundation`s Manhattan office this fall. According to "The
New York Times," the Clinton foundation brought in more than $214 million
in revenues last year but it ran more than an $8 million deficit, $8
millions in the red.

Today, Rush Limbaugh previewed how Karl Rove`s Super Pac and many
others in the Republican side will be using "the Times" report and
distorting it when Hillary Clinton`s presidential campaign gets official
under way.


LIMBAUGH: "The New York Times" for some reason, has done thorough
expose on the Clinton Global Initiative. They have ripped the Clinton
charity to shred in "the New York Times." I`m telling you, if you want to
make two big a big deal out of any one of these things, but there are a lot
of little things starting to align. Is Rush Limbaugh editing "the New York
Times?" This piece that is in "The New York Times" essentially points out
that you know, this thing is losing money left and right. It raises money
out the wazoo. It is running deficits and the Clintons are getting rich.


O`DONNELL: Joining me w, one of "The New York Times" reporters who
co-wrote this story, Nick Confessore.

Nick, the article points out -- and by the way, most of the findings
in the article were from this report that were commissioned -- that report
was commissioned by the Clinton foundation itself. But it points out this
loss of money that I`m having trouble understanding, how they can have such
a big cash flow and then end up with a deficit at the end of the year. And
one of the people at the foundation seems to suggest, well, that is normal
in these kinds of foundations. Is that a normal financial outcome?

was not deficits. Every year was a couple of years of deficits. And if
you have a budget like that it can sound like a lot. I think the, you
know, the key thing here is, you know, foundations often struggle to get
donors to give them money, you know, to pay their bills. And you know, the
average donor wants to give his or her money for the water project in
Africa, not for the power bill for a foundation.

That is kind of the general problem in philanthropy and, of course,
the foundation. A big problem for them is that they have no endowment.
The gates foundation, the Rockefeller foundation, they have huge endowment
throwing cash to cover the operating expenses. The Clinton foundation, up
until now, does not have one. And that is the real thing because if they
don`t have that, they haven`t got that cushion for operating expenses.

O`DONNELL: Nick, Rush Limbaugh has been calling Clinton foundation a
slush fund for Bill Clinton for years. He now thinks in your article he
has that proof. I read your article, I didn`t see that proof. But what do
you think are the elements of your report that -- the most difficult ones
for Hillary Clinton to deal with, should this come up, that she might have
to deal with as a candidate?

CONFESSORE: Well you know, I think that (INAUDIBLE) from Russian show
where the usual level of factual act here to see, I mean, it is
unrecognizable in terms of my piece. But I think, you know look, the
foundation actually has long under-paid a lot of people. And there is no
one working there who is getting rich off the foundation, salary.
Actually, one thing they did was try to bring the salaries in line with
competitive foundations.

I think the real import of this is, you know, Hillary Clinton is a
rival. Chelsea`s increased role -- this is going to be the nerve center of
their public life for the next few years. And I think what has got to be
troublesome for them is, in this report, you see some echoes, a mix of
ambition and success and dysfunction that has been associated with, you
know, the Clinton White House in the early years, and of course the
presidential campaign of Hillary Clinton.

I don`t think you want to keep hearing echoes of that in the
management of their structure, their growing concern. They are now family
philanthropy which is supposed to be, you know, a continuing concern for
Chelsea Clinton and her future life.

O`DONNELL: And Nick, tonight, "Politico" is reporting that this may
be somehow a reaction to your report this morning which is that Hillary
Clinton may be exploring some kind of academic position as possibly a
better platform that the Clinton family foundation would be for the coming
couple of years.

CONFESSORE: I mean, you know, it is, you know, Clintons all have kind
of have multiple platforms. That is kind of how they run everything. It
wouldn`t surprise me if she had something beside the foundation. But of
course, it is new. You have to wonder if there is a trepidation from her
people about, you know, committing herself fully to the foundation as the
only non-book, non-speech making platform for her public life.

O`DONNELL: Nick Confessore of "the New York Times," thank you very
much for joining us tonight.

CONFESSORE: Thank you, Lawrence.

O`DONNELL: Chris Hayes is up next.


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