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'The Last Word with Lawrence O'Donnell' for Tuesday, August 20th, 2013

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THE LAST WORD WITH LAWRENCE O`DONNELL
August 20, 2013

Guests: Bill Thompson, Chris Van Hollen, Julian Epstein

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: We don`t speculate on what we might find.

UNIDENTIFIED MALE: The so-called scandal at the IRS.

UNIDENTIFIED MALE: We believe that it was ideological.

UNIDENTIFIED MALE: Un-right (INAUDIBLE).

UNIDENTIFIED MALE: Clearly affected only conservative groups.

UNIDENTIFIED MALE: If you have not much about it lately, well, that is not
an accident.

ALEX WAGNER, MSNBC ANCHOR, NOW WITH ALEX WAGNER SHOW: Tuesday August 20th,
2013.

CHUCK TODD, NBC NEWS CHIEF WHITE HOUSE CORRESPONDENT: It is Tuesday,
August 20th, 2013.

WAGNER: Has the U.S. cut off aid to Egypt?

UNIDENTIFIED MALE: What is going on with San Diego`s mayor?

UNIDENTIFIED FEMALE: Glenn Greenwald is lashing out at authorities.

UNIDENTIFIED MALE: Elmo Leonard (ph) has died at the age of 87.

UNIDENTIFIED MALE: Ted Cruz tried to rally the Republicans.

UNIDENTIFIED FEMALE: Ted Cruz has got a lot of attention.

UNIDENTIFIED MALE: To defund the president`s health care plan.

UNIDENTIFIED MALE: Holding town hall meetings against Obama care.

UNIDENTIFIED MALE: Now is the single best time we have to defund Obama
care.

SEN. RAND PAUL (R), KENTUCKY: I don`t think shutting down the government is
not a good idea.

UNIDENTIFIED MALE: I think shut downs are not a good move at all.

UNIDENTIFIED MALE: We are standing up to take this country back.

JOY-ANN REID, MSNBC POLITICAL ANALYST: Why can`t the Republicans all get
on the same page?

UNIDENTIFIED FEMALE: Is this silly season? Absolutely.

GOV. CHRIS CHRISTIE (R), NEW JERSEY: It is my honor to endorse him for the
United States Senate.

UNIDENTIFIED MALE: Chris Christie`s endorsement of Steve Lonegan in the
U.S. Senate.

CHRISTIE: And I am proud to have him as a candidate for the United States
Senate.

UNIDENTIFIED MALE: Lonegan has a chance to win.

UNIDENTIFIED MALE: It could be even better when Cory Booker in limousine.
Cory Booker is just too liberal for New Jersey.

UNIDENTIFIED MALE: Cory Booker is way ahead in nearly every poll.

REID: Why can`t the Republicans all get on the same page.

UNIDENTIFIED MALE: We don`t speculate on what we might find.

UNIDENTIFIED MALE: They say this is a fool`s errand.

CHRISTIE: I`m proud to have him as a candidate for the United States
Senate?

UNIDENTIFIED FEMALE: Is this silly season? Absolutely.

(END VIDEOTAPE)

LAWRENCE O`DONNELL, MSNBC ANCHOR: Ninety-nine nights ago at this hour, on
this program an IRS scandal was exposed for the first time.

(BEGIN VIDEO CLIP)

O`DONNELL: The real scandal is what the IRS did in 1959 when it changed
the meaning of the English language. When the IRS decided that tax-exempt
status could be granted even if an organization was not exclusively for the
promotion of social welfare. But simply primarily for the social welfare.
And that changed from exclusively to primarily, allowing political
organizations to buy political advertising in support of candidates or as
an attack on other candidates and do so under a tax-exempt provision of the
law that was never, never intended for them to hide behind.

(END VIDEO CLIP)

O`DONNELL: And that became way, way, way too complicated for the media to
follow. And so, they remain fixated on the non-scandal, that they
considered the IRS scandal of 2013, the so-called IRS targeting of
conservative political groups for special scrutiny when applying for 501(c)
(4) tax exempt status.

(BEGIN VIDEO CLIP)

REP. DARRELL ISSA (R), CHAIRMAN, HOUSE OVERSIGHT COMMITTEE: This was the
targeting of the president`s political enemies effectively, and lies about
it during the election year.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: My question is, who is
going to jail over this scandal?

(END VIDEO CLIP)

O`DONNELL: Well, no one is going to jail, but someone is going to court.
Tomorrow, Congressman Chris Van Hollen, the ranking member of the budget
committee will file a lawsuit in court against the treasury committee to
enforce the IRS to enforce the law as written, which is that 501(c)(4)`s
must be operated exclusively for the promotion of social welfare. The fake
IRS scandal became even faker today.

One Democrat on the house, ways and means committee released documents
showing that the IRS applied even more scrutiny to political organizations
favoring Democrats seeking 501(c)(4) statuses. And they did it to
conservative groups. The word "emerge" for example was one of the search
terms that the IRS used to screen applications because the word emerge they
found tended to indicate the political groups supporting Democrats, such as
merge Nevada, merge Maine, and merge Massachusetts, all three of which were
actually denied 501(c)(4) status. Because the IRS found that they were set
up to benefit democratic candidates.

Meanwhile, not one, just remember this about this so-called scandal. Not
one conservative or tea party group was ever denied tax-exempt status by
the IRS in this so-called scandal.

Joining me now for an exclusive interview, Congress Chris Van Hollen of
Maryland, ranking member of the budget committee.

Congressman Van Hollen, I just want to say thank you and go ahead and take
as many minutes that you want to say whatever you want. As you know, for
it has been, basically 100 days now that I have been harping relentlessly
on the law as written, saying that 501(c)(4)`s should be operated
exclusively for the promotion of social welfare. And then in 1959, the IRS
wrote this legislation for mysterious reasons, saying they could just be
primarily social welfare. And that`s where this whole problem emerged.
The IRS became a referee about is this primarily or is it not primarily?
And finally, you`re trying to bring a lawsuit that will say to the IRS, do
your job, enforce the law that we, the Congress, have written?

REP. CHRIS VAN HOLLEN (D), MARYLAND: Well, that is right, Lawrence, and
you have had it exactly right. What we`re asking the court to do is to
instruct the IRS to apply the law as it was written. The way the law was
written, it was never intended that the IRS would be in the business of
trying to determine whether an organization that was seeking this special
501(c)(4) tax exempt status, whether it was primarily engaged in political
activities or primarily engaged in social welfare activities.

The law is clear. You can only get that status if you`re exclusively
involved in social welfare activities. And because they totally mangled
the English language when they put forward the regulations, the guidelines,
the IRS has been in this position of trying to dig in to the background`s
organizations to say, are you primarily vowed in social welfare activities
or political. They should never been in that business.

So, we are saying let`s clean that up. We would hope that there is
bipartisan support for a saying that the IRS should not be in that business
that should comply by the law.

But the question is, why did so many organizations and individuals deciding
used these 50(c)(4) organizations as the vehicle for what is become
political spending. And there are two reasons.

One is that citizens united case which said that corporations are people
too, so while they are nonprofits, a lots of corporations and people can
funnel money now behind 50(c)(4) organizations as long as it is less than
50 percent of their operations and they can do it secretly. And that is
motivated lots of people who want to try and elect or defeat candidates
anonymously to now use this as a vehicle.

We are saying, if you want to engage in politics, fine. No one is trying
to silence you. No one is trying to muscle you. As you know, there is
another part of the tax code, section 527, and you can spend as much money
as you want after citizens united trying to elect or defeat candidate. But
guess what, the law says you have to disclose. You have to tell the public
who you are.

So, if you want to engage in political activities, don`t try and use the
50(c)(4) for vehicle that was never intended for that purpose. Use 527`s
been above board and provide the public with information about who you are
and why you are engaged.

O`DONNELL: I want to show some video of the acting IRS commissioner Danny
Werfel, basically testifying to the House and really asking for your help
on this indirectly. Let`s listen to this.

(BEGIN VIDEO CLIP)

DANIEL WERFEL, IRS COMMISSIONER: The ambiguity that`s created between the
laws saying exclusive and the regulation saying primary is a problem.

(END VIDEO CLIP)

O`DONNELL: That`s the problem that he needs help on and your lawsuits seem
to be the solution.

VAN HOLLEN: Yes. And we think our court will come to the same conclusion
that any fair-minded person, with anyone who looks at the plain meaning of
words would, which is there is a huge distinction between something being
your exclusive purpose and something being your primary purpose. And the
gap between those two things is what has required the IRS to go probe into
the dealings of organizations, whether they`re on the right or left. And
as you pointed out, you know, it turns out, they have had to look under the
covers of organizations whether they`re on the right or left.

What we are saying is that the IRS has never been intended to be in the
business of trying finding out if the 501(c)(4) organization was engaged in
political activity or not. Those organizations were supposed to be
involved in exclusively in social welfare activities. If you want to
engage in political activity, no problem, you still can get tax exempt
status. You don`t have to pay a tax for me to be engage in political
activity. But organize under 527, and disclose to the public so there is
no secret money flowing into the political election.

O`DONNELL: Well, congressman, I just want to double underline this scandal
element before we leave it. And that is that it is 50-year-old regulations
saying primarily, it is what the IRS agents were looking at when they were
sifting through these applications. And therefore, that is why they were
trying to evaluate how much politicking are these organizations going to
do? And what -- I think you and I are both saying tonight is that in doing
that, they were doing what the regulation said they should be doing. And
we now s the evidence, they were doing it with political organizations
applying for these things across the board. Left side, right side, every
side was getting this kind of scrutiny.

VAN HOLLEN: Well, that is exactly right. The regulations said the IRS had
to determine whether your primary purpose was social welfare or whether it
was political. And therefore, they had to look under the covers of these
social organizations both on the right or the left. And what we have said
is those regulations have all along been totally inconsistent with
plaintiffs of the law, the way that Congress wrote it which says, if you
want to engage in political activity, do it somewhere else. The 501(c) (4)
are exclusively for social welfare activity.

But you`re absolutely right. An IRS agent were trying to determine whether
organizations, right or left, were engaged in political activity based on
this distorted interpretation of the law. We want to enforce the law as it
was written.

O`DONNELL: Well, this is the way out because it is very clear to me that
the administration was worried that if they tried to in effect, rewrite the
regulations, which they are empower to do, it would look political. It
would like they were trying to write these tea party groups out of this
particular tax-exempt status.

And I think going through the courts and having a judge basically read this
very simple law and order it, enforce it, is the way to go.

Congressman Chris Van Hollen, thank you very much for joining us tonight.

VAN HOLLEN: Thank you.

O`DONNELL: And thank you, thank you, thank you for bringing this lawsuit
to clarify this point that I`ve been harping on for 100 days now.

VAN HOLLEN: Thank you.

O`DONNELL: And now, joining me, former chief counsel for the house
Judiciary Committee and former staff director for the house over sight and
government reform committee.

Julian, first to the litigation here now, this lawsuit, this is a classic
Washington tool actually, when big corporations and other entities find
themselves in conflict with the regulation that they believe is in conflict
with the law, they go into federal court and they try to get that
regulation bent in some way or moved out of the way.

JULIAN EPSTEIN, FORMER CHIEF COUNSEL FOR THE HOUSE JUDICIARY COMMITTEE:
That is right. And the question is can a member of Congress get standing
to do it. I think if Chris Van Hollen, who has been a real leader on this
does gets standing, I think this will be an open member, can get this, you
have been out in front on the Obama care you predicted that accurately. I
think you may very well predict this accurately.

The governing rule when you challenge agency regulations is something known
as the Chevron case. And Chevron is abundantly clear anybody never
practiced in this area understands it. And the basic issue is if Congress
is given agency discretion, then the courts generally defer to the agency
and how they develop rules, so long as that discretion is used prudently
and appropriately.

But in case as where a Congress not given agency discretion as is the case
here when Congress said in the plain terms of the statute that you have to
apply the exclusivity standard, in those cases, it is an open and shut
case. The courts have ruled on this very many times that if an agency
doesn`t have this kind of discretion, if they don`t abuse it, that they
will be slapped down. And the people that have been the most vocal,
particularly the Supreme Court, have been conservatives on this issue.
Since Judge Ford (ph), Justice Scalia, an on-down the line of concerns the
last 30 years, one of the principal parts of their jurisprudence has been
the idea that federal agencies should not over-interpret statutes by
Congress and give an overly broad reading because that is an improper use
of their authority.

So it will be very interesting to see where conservatives go it is totally
-- Van Hollen`s suit is totally in keeping with the conservative
jurisprudence here.

O`DONNELL: This really feels to me like the culmination of the campaign we
have been waging here on this program from the start because we started to
see after a few nights of us stressing this here on the program, with your
help, Julian, that members of Congress, a few Democrats here and there and
Darrell Issa`s committee and ways and means committee, they would raise
this primarily versus exclusively thing.

But it would, you know, very few people would notice it in the course of
the hearing. But it built and it built overtime. And finally, to this,
and I have to think that the administration and the treasury, in effect
actually, welcomed this lawsuit because they need a clarification here that
political would be very difficult for the administration to come out and
say, look, everyone has been making a mistake here for 50 years. We, the
Obama administration, will straighten it out. And yes, it happens to mean
that these tea party groups will no longer be granted this task.

EPSTEIN: Well, that is the most fascinating. The most fascinating thing
about this case is where the political party is going to line up. I would
not be surprised, and haven`t spoken to anybody inside the White House, but
I wouldn`t be surprised to see the White House not defend this. And I
think they should certainly not on legal grounds, certainly not defend the
regulations at it. They should not on legal grounds and I don`t think they
should on political grounds. And as I just alluded to, it would be very
interesting to see where the conservatives are, and this I because
conservatives have been making the argument on the deferred action on
immigration, on the delay on Obama care, on the EPA rules, on carbon
emissions. They have been making the argument that the agencies are going
too far with their statutory authority to adopt these rules. And they are
way beyond their authority. So, it would be a total retreat, again for
conservatives, to impose the Van Hollen suit. So, that would be
interesting.

The other interesting question, of course, is whether this gets into court.
The courts have been somewhat skeptical about giving members of Congress
standing n cases like this. The famous case most recently was when
Republicans tried to block Obama going into Libya. And the courts there
ruled the members of Congress didn`t have standing.

This case, I think however, is a little bit different, because this is --
in the Libya case, the courts ruled it was a political controversy, and
Congress had other mechanisms, like the appropriations mechanisms to
address that.

But this case, I think, is different for two reasons. One, here, you
clearly have by the treasury department`s regulations allowing for primary,
rather than exclusive, as what is in the statute, you have what is
effectively legislative nullification. The federal agency is nullifying
the plain language of what Congress has enacted. Many years ago, but it is
the statute.

Secondly, I think the Van Hollen case is different from the Libya case, in
the sense that Van Hollen and members of Congress are likely to be the
target of the multi-million dollar campaigns where the funders are totally
anonymous. And I think he can make a very good case if he is got
particularize on, which is the standard -- which is the requirement for
standing, that these campaigns that are being funded against him either
once cede him or defeat his legislative initiatives, are done by people who
are using the cloak of secrecy and they don`t have the entitlement of that
cloak of secrecy that the exclusivity that this 501(c) (4) grant actually
gives them. So I think he has a relatively good case, and I think it is
distinct from the Libya and other standing cases.

O`DONNELL: Julian Epstein, as usual, I have been learning a lot and taking
notes as you speak.

Thank you very much for joining me tonight, Julian.

EPSTEIN: My pleasure. Thank you, Lawrence.

O`DONNELL: Coming up, Ted Cruz remains the champion of Republican lost
causes. And as of tonight, he remains a Canadian citizen.

And in the rewrite, how a company Mitt Romney called a loser is not just
re-writing success, it is re-writing the future.

And today, Chris Christie endorsed the guy who was against federal aid for
hurricane Sandy victims in New Jersey. And he is in favor of arming
teachers and he thinks our tax system was written by Karl Marx. True, it
is coming up.

(COMMERCIAL BREAK)

O`DONNELL: It has been 24 hours since Senator Ted Cruz was forced to admit
that he has Canadian citizenship. But it may take Ted Cruz eight months to
get rid of his Canadian citizenship in order to severities with the country
where he was born. He will have to pay 180 Canadian dollars, get a
security clearance from the Canadian security intelligence service, fill
out a four-page form explaining his reasons for renouncing his citizenship.
And then a judge in Canada will decide.

Anyone giving up citizenship must prove that they are or will become a
citizen of another country, not actually live in Canada, and not be
considered a security threat. He should be able to prove those things.

Up next, Ted Cruz wants to become a leader of the Republican Party, but he
is having trouble getting some followers.

(COMMERCIAL BREAK)

O`DONNELL: The Republican versus Republican fight over funding and the
affordable care act continues tonight in Texas, with the state`s junior
senator, Ted Cruz, leading the charge against the expansion of health care
coverage in this country.

(BEGIN VIDEO CLIP)

SEN. TED CRUZ (R), TEXAS: I am publicly committed along with a number of
other senators that under no circumstances will I vote for any continuing
resolution that funds even one penny of Obama care.

(APPLAUSE)

CRUZ: Now, why is it that every reporter in the media and a significant
percentage of Republicans assume with an impasse that President Obama will
never, ever give up his principles, so Republicans have to give up theirs?

If you have an impasse, you want to know one side or the other has to
blink. How do we win this fight? Don`t blink.

(END VIDEO CLIP)

O`DONNELL: The senior senator from Texas disagrees with his junior
senator.

(BEGIN VIDEO CLIP)

SEN. JOHN CORNYN (R), TEXAS: Even if you shut down the government,
mandatory spending would continue to pay for the implementation of Obama
care. We are all on the same side when it comes to the objective. There
is some difference of opinion as to the viability, or the likelihood of
success of this particular tactic.

(END VIDEO CLIP)

O`DONNELL: A new survey from "USA Today` shows that -- let`s see what is
that? 8.5 million Americans plan to use the health care exchanges to buy
health insurance. That is 1.5 million more than originally estimated by
the federal government.

Meanwhile, some Republican lawmakers are facing tough questions about their
attempts to defund Obama care.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Why would you oppose the ACA at every turn, it was
passed by the congress, passed by the Senate, signed by the president of
the United States, upheld by the Supreme Court of the United States and
reaffirmed by the re-election of the president of the United States who won
your district. Why would you oppose something that is helping you now, it
will bend the cost curve in the future. Why? Why, congressman, why?

(END VIDEO CLIP)

O`DONNELL: Joining me now is MSNBC News reporter Kasie Hunt who is live at
the heritage action Defund Obamacare town hall tour stop in Dallas and
MSNBC`s Krystal Ball.

Kasie, so that is why Ted Cruz brought the crusade tonight. And I assume
it was friendly territory there?

KASIE HUNT, NBC NEWS REPORTER: Friendlier than Canada probably would be
these days. No, there were thousands of people who turned out here at this
heritage action town hall. The ballrooms that you see behind me was
packed. And everyone I talked to, here, basically came to see Ted Cruz, or
to see his father, Rafael Cruz, who also spoke here, and was a real hit
with the attendees.

I mean, this is the crowd Ted Cruz is playing to when he makes, you know,
takes these stands in Washington, that are so angering some of the
colleagues he has, who say that you know what? Going through with this and
potentially shutting down the government to defund this law could have
enormous consequences for the Republican Party in the long run.

O`DONNELL: And Kasie, what about the senior senator from Texas, represents
the same people, John Cornyn says Ted Cruz is just plain hopelessly wrong
about this?

HUNT: Well, you know, Cornyn was on that letter, initially, that Senator
Mike Lee circulated that actually had been the root of all of this. And he
actually pulled his name off to the point he was angered. But the crowd
that was here tonight actually yelled John Cornyn`s name at the stage a
couple of times when Cruz was referencing the impact and how Republicans
need to hang together. And there was another conservative group here in
this state earlier this month who held a mock town hall with John Cornyn,
because apparently they say Cornyn wouldn`t show up. So they stood a
cardboard cutout of Cornyn up and said, you know, hey, this is the guy we
don`t want to support.

So, certainly not very many hands of him here tonight.

O`DONNELL: Krystal, Ted Cruz trying to find followers to this defund
campaign, not working so well where he needs them which is in the United
States Senate.

KRYSTAL BALL, MSNBC HOST, THE CYCLE: Yes, that is an excellent point. But
you know, the interesting thing here is you see with Ted Cruz, the town
hall. You see how cheap the rhetoric is and how the base just eats it up.
They love it, it is cheap, it is quote unquote "common sense" to them.

This is a monster that the Republican leadership themselves created by
allowing these tea parties strain to take over their party. So now, Mitch
McConnell and John Cornyn, when they`re trying to actually explain the
mechanics of this, it sounds so much less interesting than the red meat
that Ted Cruz I able to throw.

O`DONNELL: Don`t blink. It is common sense.

BALL: Don`t blink.

O`DONNELL: That`s all of this. That`s all governing is. Don`t blink.

BALL: It is common sense, Lawrence. That`s right.

So Mitch McConnell is sort of hopelessly trying to explain the
congressional (INAUDIBLE) mechanics to a base that just wants to hear don`t
blink.

O`DONNELL: But for Cruz, going forward, in the Senate, I mean, it is
almost as if he is ignoring the fact that he is a senator. And he is
behaving more like, you know, some kind of guy who is out there just --
like Jim DeMint is, no longer a senator.

BALL: Well, he is positioning himself as a voice, the anti-establishment
voice, right, the true tea partier. Because as we know, the tea party
sprung up not only out of opposition to the president and to Democrats, but
also to Republicans that they were frustrated with. So, he is really
trying to be that outsider voice and takes pride in any time he can sort of
stick it to the Republican establishment.

O`DONNELL: Kasie, quickly before we go, any word in the group tonight
about Ted Cruz`s confirmed citizenship?

HUNT: In this group, people were fairly dismissive. But, you know, a
couple of weeks ago, I was in Iowa, Cruz of course, has been keeping a
schedule that is going to put him in some of the early presidential primary
states. I was there with the family leader. And there were questions
there bubbling up about, you know, whether or not this was going to be an
issue, as far as whether or not he was actually going to become eligible if
he were to run.

Cruz addressed some questions about it at a press conference, before this
town hall. He declined to speculate on whether or not he would he be
eligible to run for president, should he decide to do so.

O`DONNELL: NBC`s Kasie Hunt and MSNBC`s Krystal Ball, thank you both for
joining me tonight.

BALL: Thanks, Lawrence.

O`DONNELL: And coming up, a new dramatic video on a campaign to repeal
Stand Your Ground laws.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

CHRISTIE: I am thrilled to be here today to do something that I have been
waiting to do for four years.

(END VIDEO CLIP)

O`DONNELL: Yes, sure, you have.

In the spotlight tonight, Chris Christie versus Cory Booker. Chris
Christie endorsed Cory Booker`s Republican opponent for the United States
Senate, Steve Lonegan.

(BEGIN VIDEO CLIP)

CHRISTIE: Wait until they see Steve Lonegan on the United States floor of
the Senate. Steve and I have believed and still believe in so many of the
same things.

(END VIDEO CLIP)

O`DONNELL: Here is something Steve Lonegan believes in that Chris Christie
did not mention today.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE REPORTER: Do you think the federal government should be
supplying funds in any way to any extent, if so?

STEVE LONEGAN, NEW JERSEY SENATE CANDIDATE: Well, you know, the role of
the federal government in this kind of catastrophe is questionable. If
we`re going to look at somebody`s home being destroyed in a hurricane and
that is tragic for them, to see their home being destroyed. But remember,
that every day around this country somewhere, somebody suffering a tragic
equal or worse impact and we don`t want to hand them a check. The role of
federal government needs to be limited to the role of federal government.

(END VIDEO CLIP)

O`DONNELL: Joining us now is Ari Melber, just in time for the "LAST WORD"
officially calling the race for Cory Booker, right here, 10:34 p.m., on
whatever today`s date is.

ARI MELBER, MSNBC HOST, THE CYCLE: You got to get it early.

O`DONNELL: That guy is going nowhere. This is crazy, hopeless. I assumed
this was Chris Christie`s day to pretend, you know, he is with the right-
wing lunatic running in New Jersey and he will never mention his name
again.

MELBER: I think that is right. The nicest thing you could say about him
is he is the talk radio Republican. He has all of the talk radio
physician. It sounds good. Real governor --

O`DONNELL: Sounds good to crazy people.

MELBER: Sound good to them, exactly.

O`DONNELL: And don`t live in New Jersey, by the way.

MELBER: A lot of them are not in New Jersey, which is a fairly blue state,
which shows again where his sort of antenna is. But also, there is a
difference, even as the Republican Party moves right. There is a
difference between governors and the Republican Party who we see say a lot
of things but then actually are forced to govern. And we have to figure
out if they want to work with the federal government, for example through
health care to the Obama administration. Many of them said one thing did
another. Do they dislike the federal government or do they want his
support for national priorities like a hurricane, which is across the state
boundaries, you know.

The hurricane doesn`t care which is taking in. The hurricane does what it
does. And Chris Christie, if he has done one good thing this entire
season, it was actually being straight up about that and being open about
the fact that he wanted to work with the president and get some funding.
He hasn`t been as consistent on other issues and Lonegan doesn`t even meet
that standard.

O`DONNELL: Now, Chris Christie, democratic opponent, state senator Barbara
Buono has new statement today, really trying -- you know, showing how much
they do agree. She said just like, meaning Christie and Lonegan, just like
tea party extremists, Steve Lonegan, Governor Chris Christie is anti-
choice, anti-planned parenthood, anti-marriage equality, and anti-common
sense legislation to reduce gun violence. Their unabashedly conservative
views are completely out of touch with most New Jersey and seemingly they
want to bring the garden state back to the `50s, that Christie/Lonegan
platform of yesti-year has no place in New Jersey. And voters will soundly
reject their extreme. She will now try to use Lonegan, as much as
possible, to say hey, you know, look, you are not noticing just how
conservative Christie is in some very important categories.

MELBER: Right. And I think the problem is at this point in New Jersey,
Chris Christie has earned his reputation, whatever you think of it, I don`t
know that it will be dragged down by this loser that he beat once before.
And this guy really is right wing and extreme. I mean, in New Jersey, he
opposed family medical leave funding, OK, which if you`re a family values
person, right, and you want people to be able to take care of their loved
one ones, not the government, but go home and do that, or beyond leave for
having a child. And what`s more family values has been giving birth, he
opposed that. So, he is really out there.

The other political piece, Lawrence, that people should not forget, and the
Republicans should not forget --

O`DONNELL: I won`t forget, I`ll write it down.

MELBER: Is that Chris Christie says he wants to help this guy, right? But
he scheduled the election, to avoid being on the same ticket to deny this
guy any of the Chris Christie bout. That is --

O`DONNELL: Look at those notes. Do I get a closer look?

MELBER: That, I think, is where his heart is at.

O`DONNELL: So Ari Melber, thank you very much for joining me on this
historical moment where we are calling the race here in "the LAST WORD" for
Cory Booker in the Senate.

MELBER: You got it.

O`DONNELL: -- campaign in New Jersey.

Coming up now in the rewrite -- yes, we are going to be coming a partner,
how the electric car company Tesla Motors is rewriting the future of the
American automobile.

And, trying to rewrite a Texas law.

(COMMERCIAL BREAK)

O`DONNELL: Bradley Manning will be sentenced tomorrow at 10:00 a.m. for
leaking hundreds of thousands of classified documents to Wikileaks.
Bradley Manning could get a maximum of 90 years in prison. The prosecution
has asked for a 60-year sentence, the defense made a final plea for
leniency today saying Bradley Manning has demonstrated that he could be a
productive member of society. The defense argued that Manning`s commander
should have removed him from duty because of his erratic behavior.

The rewrite is next.

(COMMERCIAL BREAK)

O`DONNELL: America`s new electric car company, Tesla Motors, continues to
rewrite the future of the American automobile. We have previously reported
that the electric car company`s model "S" is motor trends 2013 car of the
year and we have reported that it is automobile magazine`s 21023 automobile
of the year. And that it has received a 99 out of 100 rating from consumer
reports, the highest rating ever given to a car.

And now, Tesla has received the best safety rating ever given by the
national highway traffic safety administration. The car actually managed
to score higher than the safety administration`s usual top score of five
stars. The model "S" has actually achieved a record high 5.4 stars. The
model "S" set a new record for the lowest likelihood of injury to occupants
and exceeded the safety score for all sedans as well as all SUV and mini
vans.

The car`s safety is based on two things. One is the very simple advantage
of not having a big heavy gasoline engine planted right in front of the
driver and front seat passenger. There is really nothing much under the
hood in front of them, other than more trunk space. And that means that in
a front end collision, the front end of the car collapses more easily and
smoothly than a car with a big fat gasoline engine under the hood. The
front end of the Tesla can absorb more of the shock and impact in a
smoother way than other cars can. And therefore, it offers that much more
protection to passengers.

And then there is Tesla`s obsession with safety. Tesla clearly decided
that they wanted to get the highest safety score in history, and so when
they pre-tested the car and found it would get top scores in every one of
the safety administration`s specific impact tests, Tesla then searched the
car to find what weaker points the body had that would actually never been
tested by the safety administration, and then they strengthened those
spots, too.

And so, Tesla has produced not just the safest car in America, but the
safest car in the world. And of course, Detroit hates that.

The other American automobile manufacturers don`t actually hate Tesla cars,
but they do hate the way that they are sold. Tesla doesn`t use a network
of dealerships the way Ford, General Motors and all the other manufacturers
do.

Tesla sells directly to consumers. No dealership middlemen there, none of
that stuff. Of course, the industry feels threatened by that. And the new
model of sales, and so, car dealers have been lobbying state legislatures
around the country to block Tesla wherever they can.

Tesla is a Silicon Valley start-up. And the Tesla cars are made in
California. And that liberal regulation, heavy state of California
actually allows Tesla to do business any way it wants to. So Tesla has
show rooms in California where they can sell cars directly to consumers.
The manufacturers, selling directly through their own show rooms. And you
can also order a Tesla online in California.

But in Rick Perry`s Texas, automobile sales are much, much more regulated
by the government because the automobile dealerships demand it, so that
they can maintain their monopolies over the sale of new cars.

In Texas, new cars can only be sold by automobile dealership and never
directly by the manufacturer. So Tesla has show rooms in Texas, which they
call galleries, because Texas law forbids Tesla from selling cars directly
to consumers in their manufacturer`s show rooms.

But it is legal to buy a Tesla online in Texas and about 700 Texans have
done that, and Tesla is committed to supporting its customers in Texas.
The company is building super charger stations throughout Texas, so owners
can plug in free of charge along several of Texas`s major highways. The
San Marcos super charger station opened today.

And when the Texas legislature goes back to work, Tesla will go back to
pushing legislation that will allow the company to actually sell cars in
its Texas show rooms. Governor Rick Perry says he supports the bill that
would allow manufacturers to sell automobiles directly to consumers. But
he didn`t support it enough to prevent it from dying in the last
legislative session.

We can`t wait to hear the anti-regulation Texas legislators making their
speeches on the floor of the Texas house and Senate against Texans` right
to walk into a Tesla show room to buy the safest car in the world.

(COMMERCIAL BREAK)

O`DONNELL: The connection between Trayvon Martin and New York City`s Stop-
and-Frisk law is next. Bill Thompson will join me.

(COMMERCIAL BREAK)

O`DONNELL: This week, the coalition to stop gun violence released this new
public service announcement based on the killing of Trayvon Martin.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Which entrance he is at that he is heading towards?

UNIDENTIFIED MALE: The back entrance.

UNIDENTIFIED MALE: Are you following him?

UNIDENTIFIED MALE: Yes.

UNIDENTIFIED MALE: OK, we don`t need you to do that.

UNIDENTIFIED MALE: OK.

UNIDENTIFIED MALE: All right, sir, what is your name?

UNIDENTIFIED MALE: George.

UNIDENTIFIED FEMALE: I think they`re yelling help, but I don`t know.

UNIDENTIFIED FEMALE: Does he look hurt?

UNIDENTIFIED FEMALE: I can`t see him. I don`t want to go out there. I
don`t know what is going on. They are sending.

UNIDENTIFIED FEMALE: So, do you think he is yelling help?

UNIDENTIFIED FEMALE: Yes. There was a gunshot.

UNIDENTIFIED MALE: You`re saying they shot who?

UNIDENTIFIED FEMALE: A guy, he is raising his hands up, saying he shot a
person, oh, my God.

UNIDENTIFIED MALE: He has somebody at gunpoint -- they`re going to handle
the situation from here.

UNIDENTIFIED MALE: Oh, my God. It is a young boy. Oh, God.

(END VIDEO CLIP)

O`DONNELL: New York City mayoral candidate Bill Thompson saw a connection
between the killing of Trayvon Martin and New York City`s Stop-and-Frisk
program, when he said here in New York City we have institutionalized Mr.
Zimmerman`s suspicion with the policy that all that requires are police
officers to treat young Black and Latino men with suspicion to stop them
and frisk them because of the color of their skin. If our government
profiles people because of skin color and treats them as potential
criminals, how can we expect citizens to do any less?

Joining me now, New York City mayoral candidate Bill Thompson.

Bill, that point that we have the New York City police officers acting,
initiating stops and frisks, based on exactly the kind of stuff George
Zimmerman was using, luckily we`re not talking about professionals, so they
are not shooting and killing people when they do it. But thousands of
Stop-and-Frisks have been based on that or less than what George Zimmerman
thought.

BILL THOMPSON, NEW YORK CITY MAYORAL CANDIDATE: Well, if you look at
hundreds of thousands of stops and frisks, and over the years that has
become millions. And this institutionalized suspicion. I think we saw
what happened with the judge`s decision last week. But the judge said that
the way the Stop-and-Frisk has been conducted in the city of New York
violates people`s constitutional rights, and I agree with that. I think it
is wrong. I think it is a policy that has been misused and abused by the
city`s administration.

O`DONNELL: What would you do as mayor on this issue?

THOMPSON: Well, I think there are a number of things. First, eliminate
profiling. I think, you know, it can be done. It requires a mayor who
takes responsibility in leadership and hires a police commissioner who will
do the same thing. It is -- I made recommendations earlier --

O`DONNELL: You want a new police commissioner?

THOMPSON: Absolutely. I have indicated that I wouldn`t keep Ray Kelly as
police commissioner. I also think it is getting more individuals back to
training for police officers what constitutes a real stop. When and when
should it used. And then rather that looking at the number, what would
seem these days in the city of New York, quotas that are attached to Stop-
and-Frisk, you know. We think we saw that at the trial. Sergeants and
lieutenants telling people, you give me the three-fourths of 250s, you give
me five 250, you give me four today. Eliminate that also.

And start to look at, you know, we looking for results, not just stops,
looking for legitimate results. And when people are stopped having an
officer hand them a reason why. This is the reason you were stopped and at
least explain that. There are a number of things that need to be done to
eliminate the abuse of stop-and-frisk, to make sure people are no longer
profiled. I am committed to that. And as mayor, I would make sure as that
that happens.

O`DONNELL: But Mayor, Mayor Bloomberg and police commissioner, Ray Kelly,
reacting to the federal judge`s opinion and seemed to be talking past the
judge and they just seem to be talking passed each other. Judge is talking
constitutional principles and they are talking practicality. They are
saying hey, wait, this is a program that has been working well for us. We
like the statistical results we have been getting from this program.
They`re not hearing, it seems to me, what the judge is saying.

THOMPSON: Well, it also when they look at the statistical results, you are
seeing and say 2011, almost 700 people who were stopped and frisked, 90
percent of them were Black and Latino, but the results were minimal. And I
think if anything, you saw more people who want them having to turn their
pockets out, who then there was some marijuana was found, that was the big
result. It was not, you know, huge in getting guns and weapons off the
street. It is a police tool, unfortunately, under a Bloomberg and Ray
Kelly administration. It has become a policy. It should not be that.

O`DONNELL: Well, and when I look at the numbers and the overwhelming
majority, more than 80 percent of these stops involve completely innocent
people who have absolutely no reason to be stopped. What the mayor and the
police commissioner don`t seem to be recognizing is every one of those
people is dissatisfied with their interaction with city government that
just occurred. And there is been nothing that the city government did at
the end of that interaction to restore that faith in the way the city
government is working.

THOMPSON: Absolutely. And what you had as police officers doing their
job, following this policy that has been pushed on them. It`s prayed the
relationship between community and police. If anything it has pushed them
further apart.

O`DONNELL: Yes.

THOMPSON: That is a mistake. And the mayor and the commissioner seem not
the understand that. That it has probably done more to damage
relationships between Black and Latino communities and the police
department and police officers than anything else that could be done.

O`DONNELL: Twenty-one days to go. What is the key to getting to the
victory line here?

THOMPSON: I think it is just turnout, making sure people come out and
vote. If people come out and vote, I`m confident that either I`m going to
get to 40 percent and that keeps out you of a run off or I`m going to one
of the top two people and make the run off. So, I`m very confident.

O`DONNELL: Well, I`m no longer a New York City voter so you are wasting
your time here. You got to get back out there and --

THOMPSON: I wish you just got to have to move back to New York.

O`DONNELL: Bill, thank you very much for joining us tonight.

THOMPSON: Pleasure. Thank you.

O`DONNELL: New York City mayoral candidate, Bill Thompson, gets tonight`s
"LAST WORD."

Chris Hayes is up next.

CHRIS HAYES, MSNBC HOST, ALL IN WITH CHRIS HAYES: Good evening from New
York. I`m Chris Hayes.

Tonight on "ALL IN," it is Ted Cruz`s coming out party. And I`ll tell you
why in a minute he`s not just another whackado. We will go live to Dallas,
Texas, where Ted Cruz is about to speak in just a moment.

END

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