updated 8/27/2013 5:29:34 PM ET 2013-08-27T21:29:34

ALL IN with CHRIS HAYES
August 26, 2013

Guests: William Cohen, Chris Murphy, Zainab Salbi, Sharif Abdel Kouddous, Eric Schneiderman, Semi Tekinay, Steve Cohen, Pedro Noguero


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

Tonight on ALL IN:

The White House says there is very little doubt that chemical weapons
were used in Syria. Now, the question on everyone`s mind is whether the
U.S. is on the eve of another war.

Also tonight, what happens when a right wing fringe congressman says
something patently false and the world takes him seriously?

Plus, Donald Trump has a giant lawsuit on his hands over accusations
that he scammed thousands of people all over the country. We`ll talk to
someone who said she was duped out of over $10,000.

Those stories are ahead.

But we begin tonight on the doorstep of another war in the Middle
East, as Secretary of State John Kerry responded in the strongest terms to
last week`s evident chemical weapons attack by the Syrian government on its
own people.

(BEGIN VIDEO CLIP)

JOHN KERRY, U.S. SECRETARY OF STATE: The indiscriminate slaughter of
civilians, the killing of women and children, and innocent bystanders, by
chemical weapons is a moral obscenity. The reported number of victims, the
reported symptoms of those who were killed or injured, the firsthand
accounts from humanitarian organizations on the ground like Doctors Without
Borders, and the Syria human rights commission, these all strongly indicate
that everything these images are already screaming at us is real, that
chemical weapons were used in Syria.

And the president will be making an informed decision about how to
respond to this indiscriminate use of chemical weapons.

But make no mistake: President Obama believes there must be
accountability for those who would use the world`s most heinous weapons
against the world`s most vulnerable people.

(END VIDEO CLIP)

HAYES: There must be accountability. Earlier today, a six-car convoy
carrying U.N. weapons inspectors was attacked by sniper fire. No one was
hurt, but the U.N. team was forced to return to a government checkpoint.

The team replaced their damaged car, later proceeded to the Damascus
suburb to conduct their investigation, according to U.N. Secretary General
Ban Ki-moon.

The team visited two hospitals and interviewed witnesses, survivors
and doctors and collected samples. Last week`s attack killed 355 people
and about 3,600 more survivors were treated for neuro-toxic symptoms,
according to Doctors Without Borders.

Secretary Kerry made clear today the consensus has been achieved among
intelligence agencies and allies that chemical weapons were used. That
they were deployed by the regime and that they were killed hundreds of
people. Kerry said further information will be provided in the days ahead.

Kerry also noted Syrian government was given a chance to be
transparent.

(BEGIN VIDEO CLIP)

KERRY: Instead, for five days, the Syrian regime refused to allow the
U.N. investigators access to the site of the attack that would allegedly
exonerate them. Instead, it attacked the area further, shelling it and
systemically destroying evidence. That is not the behavior of a government
that has nothing to hide.

(END VIDEO CLIP)

HAYES: Later today, White House Press Secretary Jay Carney
underscored the use of chemical weapons is undeniable.

(BEGIN VIDEO CLIP)

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: And the evidence that
chemical weapons were used is undeniable. And the proof comes from sources
well beyond the U.S. government, open sources, international organizations,
witnesses on the ground.

(END VIDEO CLIP)

HAYES: Carney would not speculate about a timeline for response.
Meanwhile, public opinion is still strongly, very strongly opposed to U.S.
military intervention, even if Syria used chemical weapons. A daily poll
finding support of military intervention actually decreasing to 26 percent
in favor, with 49 percent opposed.

The question for policymakers in the White House, the president,
members of Congress and citizens, is now that you have a massacre in broad
daylight using chemical weapons, what do you do about it?

Joining me is former secretary of defense in the Clinton
administration, William Cohen -- actually that is Senator Chris Murphy we
have in front of us.

Senator Murphy, thank you -- there is William Cohen. Thank you.

Former Secretary William Cohen, how are you?

WILLIAM COHEN, FORMER DEFENSE SECRETARY: I`m well, Chris.

HAYES: Secretary Cohen, my first question is from a purely technical
capacity standpoint, you`re in the meeting in which the president is asking
you the question, OK, what are possibilities, technically speaking, for
what the U.S. could do when we talk about rendering accountability here?
What are we talking about? What do those look like?

COHEN: Well, the first question would be -- I`m sorry, I got an echo.
First, the issue would be, what is the mission? If you define the mission
clearly, can we execute successfully? Can -- and what are the costs? Not
only in terms of money but in terms of bloodshed and also the possibility
of collateral damage.

So, these issues have to be settled early on. Following that, you
say, well, Mr. President, you defined the mission to do what? To punish
Assad? Well, how heavy do you want us to go or how light? Is it some kind
of a goldilocks scenario here?

But I would also warn the president or caution the president saying,
once you take step one, are you prepared to take step two and three and
four? Because it`s not enough simply to launch Tomahawk missiles and hit
some of his military targets. Once you do that, it`s not like you can just
launch it and step back and say, we wash our hands of it. You`re in.

So, the question becomes, what happens if the Russians decide they
want to support Syria more than they are today and Iran does the same? And
battle plan changes on the ground --

HAYES: Secretary --

COHEN: -- because the United States have to do these things? So, all
of that is involved in this kind of calculation.

HAYES: I want you to explain that because I think that`s very
important. If we`re talking about essentially punishment to enforce an
international norm about the prohibition of chemical weapons, which I think
is probably an international norm that we all agree to and are in favor of,
what you`re saying to me is some kind of distinct act of punishment, if
it`s a hellfire missile, a cruise missile, that the day after that you
can`t just do that and stop. Why not?

COHEN: Well, because there`s bound to be a reaction. There will
certainly be a reaction by the Syrian forces. It may, in fact, stimulate
more Iranian involvement. Not only that, Hezbollah coming from Lebanon,
which is doing today.

So, the president does not want to change the dynamic on the
battlefield by launching any strikes. But by the same token, by launching
those strikes and taking out, let`s say, airfields, aircraft, air assets
and others, does that change the dynamic on the ground? And if that`s the
case, do the Russians sit on the sideline, or the Iranians sit on the
sideline? And do they then intensify their action?

So, my caution is, let`s make sure before you take step one that you
have a battle plan involved that takes into account the contingencies and
the potential escalation. Also take into account that there may be some
collateral damage which is a nice word for saying I`m going to kill some
innocent civilians in the process.

(CROSSTALK)

HAYES: In response to what we just called a moral obscenity, that`s
an important note as well.

Former Secretary of Defense William Cohen, thank you for your time
tonight. I really appreciate it.

COHEN: Pleasure to be with you.

HAYES: All right. Joining me now is Senator Chris Murphy, Democrat
from Connecticut, a member of the Senate Foreign Relations Committee.

In May, Senator Murphy was one of three senators who voted not to arm
Syrian rebels, now says he`s open to the possibility of U.S. intervention.

Tell me, Senator, where your thinking is on this in the wake of what
looks like relatively persuasive evidence we have just seen a fairly
ghastly massacre in using chemical weapons?

SEN. CHRIS MURPHY (D), CONNECTICUT: Yes, I certainly agree with the
White House that it seems undeniable there was a pretty massive usage of
chemical weapons, and it`s absolutely unacceptable. The question here is
not whether there is a will to step in and try to stop these actions. It`s
whether there`s a way.

And my worry all along has been that we are in the medium term and
long term going to make the situation worse, not better. Secretary Cohen
said it very well. A short-term targeted strike from the United States is
going to prompt a reaction. Possibly the usage of more chemical weapons,
which, of course, will then cause us to go in a second time, a third time.
And we will very quickly own the battle space there and be involved in yet
another quagmire in the Middle East, not to mention what comes after a
revolution or the fall of Assad, which is a long-term civil war.

What I want here is for us to just be very sober in our understanding
of what a targeted military strike means. It may mean a long-term very
expensive, very costly engagement for the United States. And I fear that
right now in this issue, our politics are being driven by some very
legitimate short-term humanitarian concerns that may belie a much more
costly endeavor in the long run.

HAYES: I want to ask you a constitutional and legal question about
the role of Congress in all this, and I want to read a statement from
Speaker John Boehner about a conversation he had with the White House.
This afternoon, the speaker had preliminary communication with the White
House about the situation in Syria and a potential U.S. response.

The speaker made clear that before any action is taken there must be -
- and I`m highlighting this -- "meaningful consultation with members of
Congress as well as clearly defined objectives and a broader strategy to
achieve stability."

What does meaningful consultation say to you? And is it within the
four squares of the War Powers Act for the White House to unilaterally
launch some kind of strike without a vote from Congress?

MURPHY: I think the president should come to Congress here for a
vote. And I think president is right to be very careful in considering his
response here and the actions of the United States. But given the fact
that he`s taking that time, there`s no argument that there isn`t also
enough time to come have a debate before Congress.

Now, I was on the losing end of a pretty lopsided vote. Very clearly
the Senate is likely going to weigh in to give the president the ability to
strike here. I think that`s the wrong move. But at the very least, it
would be a vote by the United States Congress which I think would back up
the president`s actions here should he take them. I think he should come
to the Congress for a vote.

HAYES: Senator Chris Murphy of Connecticut, thank you so much. I
really appreciate it.

MURPHY: Thanks, Chris.

HAYES: Joining me now Zainab Salbi, who is raised in Saddam Hussein`s
inner circle. Her father was Saddam`s personal pilot. She left Iraq and
founded Women for Women International. She worked in war zones all over
the world, including in Bosnia and other places in the Middle East.

And you are someone who worked in war zones who is a humanitarian, has
seen up close the ravages of war and as we think about when we look at the
images, which are absolutely horrifying and horrendous, what is going
through your head when you look at those images and think about the
possibility of increased American activity, intervention in the region?

ZAINAB SALBI, WOMEN FOR WOMEN INTERNATIONAL: Well, beside
humanitarian aspect, I want to actually take it from a cultural perspective
as an Arab. So, this is the first time in Arab history that the Arabs are
seeing other Arabs killing themselves, and chemical weapons and having
women and children in such all of all of images of death. Never in Arab
history are such images available.

HAYES: And that`s because of the availability of the images when
things like Halabja happened in Iraq.

SALBI: When Halabja was Kurds and Iranians. And even though it
happened 30 years ago, it was as outrageous, it`s not war actually 30 years
ago against the Kurds and Iranians, it was still the other.

There`s a great deal of anger that has happened in the Arab world,
because a line you do not touch women and do not touch children has been
crossed.

HAYES: And these images --

SALBI: Culturally.

HAYES: -- have crossed the region. Everyone is seeing --

SALBI: Absolutely. There`s an outrage of that.

Now, also, everyone doesn`t know what to do because you have the
opposition to Assad`s regime are not united. And they are reflecting
another kind of fight in the region. An ideological fight in the region
between those who want to return the region to a religious era where
everyone is going to traditions and all of these things and between those
saying we can maintain our religion within the modern things.

The opposition in the Syrian war reflect these two tensions.

So the intervention in here is not a simple intervention. It`s not
about a strike. This is about a long-term intervention.

HAYES: An American missile strike, some sort of kinetic action from
the United States government in Syria as a punishment for violating this
international norm. Do you think the odds of that are on the side of this
-- that making the situation better and preventing future massacres of this
type or making it worse?

SALBI: Well, first of all, we still need to wait for the United
Nations to verify all of that. Second of all, once the United Nations
verifies this, this is a violation of international law. So, this is not
only about American law, this is about international law.

And I think it`s very important that we abide by international law.
And so we have an international coalition to go into Syria as opposed to a
coalition of the willing as we have done in Kosovo, which was actually
illegal. It`s an illegal and international standard.

So, if we want to restore America`s image, in my opinion, in the
region, we need --

HAYES: The process internationally is important.

SALBI: Absolutely.

Third, we need to make sure this is not about a strike, this is about
a long-term intervention creating a coalition government staying on the
long-term, making sure there`s stability in Syria, no civil war.

HAYES: And the amount of appetite, I would say, domestically,
politically in the United States for that is essentially nil.

Zainab Salbi, founder of Women for Women International, great. Thank
you.

SALBI: Thank you.

HAYES: The idea the Obama administration is in cahoots with the
Muslim Brotherhood in Egypt is quite possibly be traced back to one sitting
is Republican congressman. I`ll tell you that story coming up.

(COMMERCIAL BREAK)

HAYES: Have you ever been a patient in a hospital, you know a few
things. First, you don`t get much sleep. Second when you get home you get
a lot of bills. Third, those bills will probably be huge, even if you have
insurance. What you may not have known is exactly how much everything is
costing you. Prepare to be shocked.

(COMMERCIAL BREAK)

HAYES: If you have an occasion to watch this network, you should be
pretty familiar with Texas Republican Congressman Louie Gohmert -- in large
part due to his propensity to say things like this.

(BEGIN VIDEO CLIPS)

REP. LOUIE GOHMERT (R), TEXAS: What we now have today is a holy
quintet who goes against the laws of nature and nature`s God.

This president has allowed abuse of Christians in the military, unlike
any other religion.

You have to close your embassies like a bunch of cowards.

Do you really believe that the ones who want to destroy the United
States are more stupid than these entrepreneurs in China?

(END VIDEO CLIPS)

HAYES: The reason we played clips of Gohmert is because he`s an
entertaining and enraging reminder of what the right wing fringe in
American politics thinks about the big issues of the day.

Let`s make one thing clear. No one mistakes Louie Gohmert for a
powerful presence in American politics.

In other words, almost no one takes this guy seriously. Except
apparently for a whole bunch of folks in Egypt who think Gohmert is the
voice of truth about American foreign policy. Specifically, Egyptians who
believe the U.S. and the Muslim Brotherhood have gone in cahoots to destroy
Egypt.

Now, no one really knows the origin of this theory. Many people point
to a clip of Gohmert on the House floor in March of last year in which he
equates giving $1.5 billion in aid to the Morsi government, with support
for terrorists.

(BEGIN VIDEO CLIP)

GOHMERT: This administration, through Secretary Hillary Clinton, is
going to announce that it could care less what Congress has ordered about
helping the enemies of Israel, about helping those who are terrorizing and
persecuting Christians in Egypt. And they`re going to get $1.5 billion,
not in humanitarian aid, according to this story. Not food. Military aid.

(END VIDEO CLIP)

HAYES: Here`s the thing. Despite the fact that most of that money,
$1.2 million of it in fact goes to the Egyptian military and none of it
goes to the Brotherhood, the idea that the Obama administration partnered
with the Muslim Brotherhood has spread like a pandemic across post-coup
Egypt.

Take a look at the version of Louie Gohmert speech about military aid
to Egypt making the rounds in Cairo. According to Google translate, it`s
called congressman exposes Obama`s support for the Muslim Brotherhood.

(BEGIN VIDEO CLIP)

GOHMERT: This administration, through Secretary Hillary Clinton, is
going to announce that it could care less what Congress has ordered about
helping the enemies of Israel, about helping those who are terrorizing and
persecuting Christians in Egypt.

NARRATOR: President Obama, you invited the Muslim Brotherhood to the
White House?

(END VIDEO CLIP)

HAYES: Egypt right now is in a period of extreme tension and violence
lurks around the corner and suspicion and factualism runs deep. Into this
very fertile soil is, Louie Gohmert, of all people, has managed to plant
the seeds of conspiracy theory that has now, quote, "being stoked by an
outpouring of dubious pronouncements from both state and private news
media."

It`s having serious consequences of our perception in the region, the
safety of journalists there and American foreign policy.

Joining me now from Egypt is Sharif Abdel Kouddous, a correspondent
for "Democracy Now", who joins us via Skype because it`s after the curfew
in Egypt.

I have been reading that anti-Americanism in Egypt right now is at a
fever pitch. Has that been your experience?

SHARIF ABDEL KOUDDOUS, DEMOCRACY NOW: I think that`s absolutely true,
Chris. I mean, the United States has come under fierce criticism from all
sides during the latest crisis. Supporters of the ousted President Mohamed
Morsi accused the Obama administration of giving the Egyptian military a
green light for what they call a coup in ousting the president. While the
opponents of Morsi, namely the military and the security state, have blamed
the administration for cozying up to the Brotherhood while it was in power
d ignoring its many transgressions, and you saw just a clip of kind of the
state and private media using very nationalistic language and trying to
whip up the sentiment against the United States which is very popular.

But I think it`s important to remember that the vast military funding
that goes to Egypt, $1.3 billion every year, and the strong ties between
the Pentagon and the Egyptian army leave little doubt that Washington`s
strongest support is for the generals.

HAYES: Let me stop you there. That, to me, is what`s so interesting
about this entire situation. Obviously the American government was allied
with Mubarak for years, gave billions of dollars in aid. If you were to
say to me Egyptians are angry because the U.S. government is too closely
aligned with the Egyptian military or closely aligned with Mubarak, I would
understand.

But the notion that America of all places, which is has been
prosecuting a global war against, against jihadists, and Salafists and
extremists of all Islamic varieties across the world for ten years, that
people would think they were in bed with the Muslim Brotherhood, I would
not believe you.

KOUDDOUS: Right. I mean, I think look, while Morsi was in power,
there was a relationship, of course, with the Obama administration and the
Muslim Brotherhood. We saw Mohamed Morsi deal well in the eyes of the
United States with Israel`s assault on Gaza in November and he was hailed
for his role in that.

And subsequently after that, he issued a constitutional declaration
which gave wide-reaching powers and the Obama administration was quite
silent. So there was plenty of criticism for the U.S. in that respect.

But I think it`s very important to understand that the Egyptian
military is required to spend roughly $1.3 billion in aid to purchase
weapons from U.S. manufacturers. These are the large defense contractors
that have very powerful lobbying firms in Washington. Companies like
General Dynamics and Lockheed Martin, and they`re the main beneficiaries of
this aid.

And, you know, most of these weapons that we get in Egypt, these tanks
and F-16s, they`re most likely to end up in a warehouse gathering dust than
seeing any kind of combat or operational training. Egypt has more tanks by
one estimate than all of Latin American and sub-Saharan Africa combined.

So, this is -- this is really subsidiary for these defense contractors
who help the keep this pipeline going and there`s a very important aspect
to the U.S. /Egypt relationship with regards to this aid. Only Egypt and
Israel have this special privilege where they can they put the orders
forward for aid that they haven`t even received yet. Exactly -- it`s like
a credit card with a maximum limit of billions of dollars.

So, it`s very hard to shut down this pipeline because they`re allowed
to that I can these orders under the assumption than lawmakers will
continue to provide the aid every year.

HAYES: Sharif Abdel Kouddous from "Democracy Now" -- thank you so
much.

KOUDDOUS: Thank you.

HAYES: Coming up, there are thousands of people are hoping Donald
Trump was going to make them the next great real estate mogul. Instead
they`re saying he totally ripped them off and they`re suing. One of them
will be with me here, ahead.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

REV. AL SHARPTON, NATIONAL ACTION NETWORK: There will be those that
will miscast this as some great social event. But let us remember 50 years
ago, some came to Washington having rode the back of buses, but they came
to Washington so we could come today in a different time and a different
place, and we owe them for what we have today.

(END VIDEO CLIP)

HAYES: This past Saturday, tens of thousands of people gathered on
the National Mall to commemorate the 50th anniversary of Dr. Martin Luther
King`s 1963 march on Washington. A full roster of speakers from my
colleague, the Reverend Al Sharpton how just saw, to you civil rights icon,
Congressman John Lewis, all spoke from the steps of the Lincoln Memorial,
just as Dr. King did when he delivered his famous "I Have a Dream" speech
50 years ago.

The actual date of the original march on Washington was August 28th,
1963. So, the 50th anniversary is actually coming up this Wednesday. We
have on this show an incredible opportunity, I`m so thrilled to be a part
of.

On Wednesday evening, at 8:00 p.m. Eastern, in a special edition of
ALL IN, we will play Martin Luther King`s "I Have a Dream" speech in its
entirety, uninterrupted by commercial breaks.

No one really ever watches the whole speech. We see the sound bites,
the famous ones, because the full footage of this incredible event is
highly restricted and protected. That has a way of framing how we think
about Martin Luther King, Jr. And the movement he was part of. History
over the years has found ways to make King both larger than life but also
to somehow narrow his legacy.

But I can tell you nothing blows your mind more than to encounter the
real actual Martin Luther King, hear his words. On Wednesday night, we`re
going to give you that. It`s a special hour of ALL IN featuring "I Have a
Dream" speech played in its entirety. I`ll be joined for a full discussion
after the speech by special guests, including Myrlie Evers-Williams, Martin
Luther King III, as well as many of my MSNBC colleagues.

So please join us for that on Wednesday, 8:00 p.m. Eastern and stay
tuned right now because it`s Monday in August, and I`m going to teach you
how to make saline solution, next. Cable news will never be the same.

(COMMERCIAL BREAK)

HAYES: You`ve heard, dear viewer, I imagine of saline solution. It`s
a fancy name for salt, plus water. You probably used it maybe for a sore
throat or dry eyes and you probably haven`t spent that much money on it. I
hope. Here`s a pretty simple bottle of saline solution. We got it at a
Manhattan Grocery Store for $5.99.

Here`s some souped up saline solution with a bunch other chemicals in
it for red eyes. This is $6.99. And, if you want a no fuss solution, no
mass saline solution. You can always make your own. Here`s a liter
of spring water. It cost $1.29 for every liter of spring water and we need
9 grams of salt. That is less than 2 teaspoons and there are over 40
teaspoons in this $1.45 container of Morton salt.

Morton salt it turns out is what they actually use in most of these.
This is an IV bag, you`ll see in hospitals. It`s what they stick in your
arm to rehydrate you before, during and after most medical procedures. The
average wholesale cost of this puppy is as low as $0.44 cents a bag, which
seems about right given the fact that as I noted, it`s just salt and water.

But, should you be unfortunate enough to encounter this packet
of saline solution in its natural habitat of a hospital and you sign for a
hospital bill, you`re going to pay a lot more than 44 cents. If you think
you`ll pay something closer to $4.44, sorry, it`s more than that. How
about $44? Remember, it`s for this, this thing. Nope. Not $44. No.

A 1-liter bag of saline solution could run you about $91. And, if you
need six bags like a recent patient at a New York Hospital, that`s $546.
Those details come from a shocking article in "The New York Times" today.
At White Plains Hospital, a patient with private insurance from Aetna was
charged $91 for one unit of Hospira IV that cost the hospital, wait for it,
$0.86 cents.

A hospital spokeswoman defended the markup as consistent with industry
standards. She said it reflected not only the cost of the solution but a
variety of related services and processes, like procurement, biomedical
handling and storage, all of which apparently was not included in a charge
of $127 just for administering the IV and $893 for emergency room services.

This report is just the latest in a series to "The New York Times"
about the everyday mundane outrage in the pricing of medical procedures
here in the United States of America. A previous report featured this guy
who flew to Belgium, there and back to get a full hip replacement. The
whole thing, $13,666, which is nothing compared to the nearly $80,000 the
procedure would have cost him out of pocket in the U.S.

That is for an artificial hip that costs about $350 to make. And,
there is the fact that the cost of childbirth in the United States is more
than twice as much as other developed nations. It is because in the U.S.
all the charges for childbirth are broken out, meaning more bills and
higher costs and who knows, maybe you`ll get a bag of saline, too.

Just keep all of this in mind when people talk about Obama Care
implementation and scream about socialism and a government takeover. We`re
trying to move slowly, incrementally, finally toward a system that is for
lack of a better word, sane. But, as long as the price and the prices in
the American Health Care System, 546 bucks for 6 of these, the system is
still broken.

And, you know the reason they can`t just charge those kinds of
exorbitant rates in a price like Belgium? I`ll tell you. The government
simply prohibits it. As Obama Care implementation rolls out, it won`t take
long for it to become clear that the problem isn`t that it`s a government
takeover of health care. No, no. The problem is that it`s not enough.

Coming up, Donald Trump is being sued for allegedly ripping off
thousands of people. One of them will be here. We also called Mr. Trump`s
office to invite him on or someone to represent him on show. They didn`t
take us up on that. But, we gave them our control room number. And,
Donald, if you`re watching, the phone lines are open. Come on, buddy, give
us a call.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

DONALD TRUMP, MULTI-MILLIONAIRE ENTREPRENEUR: At Trump University, we
teach success. That`s what it`s all about. Success. It`s going to happen
to you.

UNIDENTIFIED MALE SPEAKER: Donald Trump is without question the
world`s most famous businessman. With the launch of trump university, he
makes the very best of America`s business education available to you and
others like you who seek a life of success, fulfillment and prosperity.

(END VIDEO CLIP)

HAYES: That was a recruiting video for Trump University, a for-
profit, non-licensed institution bearing the name of reality show host and
right wing carnal barker Donald Trump. A school with no physical
campus, Trump University offers online and live seminars promising to teach
students business, salesmanship and as you just heard, success.

And, for six years, thousands of people enrolled forking over
thousands of dollars hoping to hit it big in real estate. Now, New York`s
Attorney General Eric Schneiderman says it was all an elaborate bait and
switch operation. He will join me in a moment. A civil lawsuit filed over
the weekend accuses Trump University of engaging in, "A pattern of
deceptive and illegal business practices and seeking at least $40 million
in restitution."

As "The New York Times" reports, the inquiry began in 2011 after
dozens of people had complained to authorities in New York, Texas, Florida,
and Illinois about the institution. The school brought in perspective
students with promise of a free 90-minute seminar discussing real estate.
That according to lawsuit served as a sales pitch for a 3-day seminar
costing $1,495.

The up selling continued from there, leading people towards pricy
Trump elite packages including a professional mentorship costing up to
$35,000. Also, at issue, Trump`s claims that he hand picked instructors,
yet according to lawsuit, he did not. Other deceptions including
representations that students would get their pictures taken with trump or
that he might stop by the seminar when at most students had their pictures
taken with a life size photo of trump.

Last week Donald Trump, himself, pre-emptively launched a website
attacking Eric Schneiderman, a site, 98 percent approval.com, claimed that
students were not only satisfied with their Trump University experience but
would recommend the program to a friend. Trump is calling the lawsuit thug
politics and is floating a few conspiracy theories.

(BEGIN VIDEO CLIP)

TRUMP: I`m not a very paranoid person, but when this lightweight
attorney general, who is not respected by anybody, when he meets with the
president and then files a suit, like you know 24 hours later, I think,
yes, I think I`ve been targeted. And, I think it`s a big problem. On
Thursday evening in Syracuse, he met with President Obama. He then signed
the lawsuit and filed the lawsuit on Saturday at 1:00. Now, I`ve been
doing this a long time. When was the last time you saw a government
agency bring a lawsuit on Saturday?

(END VIDEO CLIP)

HAYES: Joining me now is New York State Attorney General Eric
Schneiderman. Well, that sounds perfectly sensible that you flew
to Syracuse to cook this up with the president of the United States for a
$40 million lawsuit against Donald Trump. You want to respond to that
accusation?

ERIC SCHNEIDERMAN, NEW YORK STATE ATTORNEY GENERAL: I think if he
goes to the super bowl, he thinks the guys in the huddle are talking about
him. I have more important things to talk to the president about
than Donald Trump. I think if he goes to the super bowl, he thinks the
guys in the huddle are talking about him.

I have more important things to talk to the president about
than Donald Trump. And, look, when you`re a prosecutor, you`re used to
people who are caught in fraud, making crazy allegations against the
prosecutor. And, it`s a distraction. He`s not responded at all to the
merits of our arguments.

He`s not responded to the fact That Trump University was never
registered as a university. State education department of New York was
chasing them. They kept lying to them and committing fraud with regard to
what they were going to do to solve that problem. They never got their
teachers certified. We deposed and have a transcript from the former
president of Trump University, who acknowledged Trump never hand picked the
instructors.

He never even met the instructors except for one guy he met once. He
didn`t participate in the curriculum. He only participated in the sales
pitch. And, the playbook, which is the guidelines for instructors, tells
them to do just what you were talking about. Sell up, that you can`t break
ranks. You always have to --

HAYES: So, what`s wrong with that? You go to a used car dealer and
they try to upsell you. Why does this cross the line?

SCHNEIDERMAN: Well, there are laws to protect people from fraud. I
mean the law protects, you know, the innocent and gullible as well as the
cynical and sophisticated. And, there were a lot of folks all over
America, who thought Donald Trump really is a successful real estate guy
when he actually doesn`t do much in the way of real estate and hasn`t for
many years.

HAYES: His father was an extremely successful --

SCHNEIDERMAN: His father was a real developer.

HAYES: I wondered actually if part of the course was Donald
Trump teaching you how to be born to the son of a fabulously successful and
wealthy real estate --

SCHNEIDERMAN: Well, the course was not taught at all by Donald Trump,
And, the people they brought in as instructors were not real
estate experts. Some of them had been in bankruptcy, themselves.

Some of them had backgrounds just as motivational speakers, which was
basically what the program was. It was all about selling them these
packages. Then they found out the mentorships were useless. They had a 1-
800 number that nobody answered. It was useless.

HAYES: This got people in the door, upsell and then take their money.

SCHNEIDERMAN: Yes.

HAYES: And, we`re talking about pretty serious amounts of money.

SCHNEIDERMAN: Yes.

HAYES: I mean $1,495 for three-day seminar. We`re talking $10,000
for the next level up, $35,000. There were actual people actually paying
these amounts.

SCHNEIDERMAN: And, one of the most despicable things about this is,
it`s in the playbook and they did this. He told everyone, "If you want to
make it in real estate. You have to raise your credit limits. You should
all call your credit card companies and get your credit limits raised and
then they got people to use that extra credit limit to buy $10,000,
$25,000, $35,000 trump packages.

HAYES: This is documented.

SCHNEIDERMAN: Documented. It`s in the complaint.

HAYES: OK. So, obviously -- Well, not obviously, it seems to me
implausible that you and the president cooked this up as a plot
in Syracuse. But, what do you say to someone who say "Look this is a
stunt. You are the attorney general of New York State. You got lots of
liberals and Obama want it by 20 points. Donald Trump is famously a barter
and right wing troll. And, this is just an easy bit of point scoring from
the New York Attorney General. There are other bigger fish to fry.

SCHNEIDERMAN: Well -- And, we are frying other bigger fish. We just
don`t have any who insist on going on T.V. and going crazy, which is why
this is getting so much attention. So -- First of all, the president and I
have never talked about Donald Trump.

We have other more important matters. There`s a lot more on the
president`s mind than this guy. Second of all, we began a general
investigation for profit schools and it`s been documented. We just settled
with one other school for 10 million bucks last week. So, this is part of
that investigation.

HAYES: And, I got to say, I have had the experience just as a
reporter, and even just having conversations with folks here in New York
City, in Chicago, in D.C. and other cities I`ve lived in, there are such a
proliferation of places. We`re not talking about Trump University, but
broadly places that say, "Hey, you`re looking to move up the ladder.
You`re working bus boy. You are working on night shift as a janitor. Come
to us, $1,500, $2,000. We`re going to certify you for this job. And, it
seems to me like a wild west. I mean there`s just very little regulation
for the entire industry.

SCHNEIDERMAN: It`s very challenging. There are laws, but it`s tough
for people in law enforcement because resources are slow. And, then in
hard economic times -- keep keep in mind. They were selling people
2008, 2009, 2010, hard economic times. People who are desperate often make
the easiest victims because they want to do anything they can do to get
back to on their feet. They were telling people, we`ll get you out of
debt. You will recoup this investment in three months. Bad stuff.

HAYES: New York State Attorney General, Eric Schneiderman, thanks so
much.

SCHNEIDERMAN: Thank you, Chris.

HAYES: We called Mr. Trump to invite him on the show tonight. We
could not get him or anyone who represents him to come on. Mr. Trump, if
you are out there, watching, give us a call. We love to talk to you.

SCHNEIDERMAN: Someone who did agree to come on the show though is
someone involved in the lawsuit. That person will be here next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

TRUMP: If you`re going to achieve anything, you have to take action.
And, action is what Trump University is all about.

(END VIDEO CLIP)

HAYES: That was Donald Trump, espousing the virtues of his for-profit
institution, Trump University, now the center of a $40 million lawsuit
brought on by New York Attorney General Eric Schneiderman.

Of course, Trump University is not alone. There`s an entire industry
devoted for-profit demonstration. Joining me now to discuss is
Congressman, Steve Cohen, democratic from Tennessee; Pedro Noguera, a
professor of education at NYU and co-author of the book "Creating The
Opportunity To Learn: Moving From Research To Practice To Close To
Achievement Gap.

And, Semi Tekinay, a former Trump University student and plaintiff in
the lawsuit. And, the phone line is still open for Donald Trump should he
wish to respond. Sema, can you just tell me about your experience? How
did you hear about Trump U? What did you end up signing up for? How much
money did you end up spending?

SEMI TEKINAY, TRUMP UNIVERSITY FORMER STUDENT: Well, I -- there was
an advertisement for this three-day program. Trump is very well known to
be very successful in real estate. I had just been let go from Citigroup
because of the financial collapse. So, I was thinking about may be
changing careers. And, I decided to invest the $1,495, and take the three-
day program, with the understanding that we would be learning basics for
investing in real estate.

HAYES: Did you learn basics about having real estate?

TEKINAY: You know, there was a lot of information at that seminar.
We learned something. It wasn`t really enough to get you started, but it
was enough to get you entice to sign up for other programs that they were
offering. And, the team seemed like they had done very well.

There were pictures of cars they had purchased and homes they
purchased with all the money they made in real estate. And, so they talked
about these additional programs you could sign up for, $10,000, $20,000,
$30,000 worth with access to different programs and services. But --

HAYES: And, did they convince you? I mean did you sign up for them?

TEKINAY: I signed up for the $10,000 bronze elite program.

HAYES: $10,000.

TEKINAY: Yes.

HAYES: That`s a lot of money.

TEKINAY: Well, you thought that you were getting some access to hard
money lenders, access to foreclosed property listings, access to mentors
and guides.

HAYES: These were the tangible things that they told you, you were
getting.

TEKINAY: I was supposed to have access to three seminars, an
instructor led. Some point during that time that I had enrolled -- after I
had enrolled, they decided to move those to online. And, they were not
instructor led anymore. So --

HAYES: So, you were at $11,000-plus.

TEKINAY: That`s correct.

HAYES: Can you afford that?

TEKINAY: Can anybody really afford to lose that? No.

HAYES: Donald Trump, maybe.

TEKINAY: Maybe.

HAYES: Pedro, there has grown up an entire universe of a kind of for-
profit education. And, I don`t want to obviously paint the entire field
with one brush. I mean, obviously this is -- we`re talking about if the
allegations by the attorney general is true, this is just a fraudulent bait
and switch enterprise and there are all sorts of those in different
industries

That said, it seems to me that we have an industry now, people are
told from President Obama on down, everyone, "You got to get an education
if you want to make it, if you want to climb up the social mobility ladder
in this country." And, we have an industry that`s come to fill that gap
and it`s not clear to me that is very well regulated, that there`s
oversight or it is actually giving people what they say they`re getting.

PEDRO NOGUERO, PROFESSOR OF EDUCATION AT NEW YORK UNIVERSITY: That`s
right. There`s very little regulation on this field, and there are lots of
students who would try -- like this lady who were trying to advance
themselves, willing to invest money that they don`t ha have in some cases,
even go into debt.

And, it`s a shame, because it`s understandable that they would want to
better themselves; but, it also there should be some kind of public
accountability on these institutions and that`s lacking right now.

HAYES: He just mentioned debt, and the attorney general talked about
them telling you to max up your credit cards. Was that true? Did that
happen to you?

TEKINAY: Absolutely. As a matter fact, over a lunch break they
encourage you to start making those phone calls and so that by the time you
got back to lunch you would have increased your credit limit. I called
AmEx, I opened a new card. And, what happened to me was my credit
score went from 802 to 700 and something.

HAYES: They were telling you to increase your -- max out your credit
cards or take out new lines of credit so you could have access to capital
for real estate deals.

TEKINAY: Of course, for those just last minute, right.

HAYES: Can I just say this? Or a few other who are watching this
saying, "Why did you do this?" I mean why did you do this? Why did you
listen to these people? What is your response to them who say, "Look, I`m
sorry that this happened to you, but come on?"

TEKINAY: Well, you know, first of all, Trump is very well associated
with successful real estate. So, you thought you were learning something.
There was a university named behind it. There were instructors coming in
and out of that class that seemed to know a hell of a lot of what they were
doing. And, you wanted -- you know, when you`re around knowledge, you want
to be around knowledge for a long period of that. And, it takes money to
access knowledge sometimes. So, you thought you were buying into
something.

HAYES: Congressman, my understanding is you introduced legislation to
kind of work on regulating reining in this entire sector. Do you feel like
we have had adequate oversight of it?

STEVEN COHEN, (D) TENNESSEE CONGRESSMAN: We don`t. You know, not
until 1992, could these for-profits get federal funds. And, there was a
90/10 rule, they had to get 90% of their moneys. They are going to get 10
percent from the federal government. They are going to get 10 percent from
other sources.

HAYES: I should -- Before you continue, I should make the distinction
is my understanding Trump University, itself, didn`t even qualify for that
because it wasn`t registered with the state as an educational institution.
So, it was completely off the table.


COHEN: Right.

HAYES: But, there are other ones that are for- profit that are
registered educational institutions that do have students that qualify for
federal loans.


COHEN: They get federal loans. They are accredited by national
agencies, not by regional agencies that are much more sequencing of
education. The department of education, already dunked it and tried to get
stronger regulations. They were -- they had stronger regulations, but
the district court struck them down.

HAYES: And, they also got lobbied. This is one of the great story.

COHEN: This is a Mark Leibovich story. I don`t agree with everything
mark said in "This Town." But, he`s right here.

HAYES: He is the author of this book "This Town."

COHEN: "This Town." And, when you look at the Graham Family that
used to be known for a newspaper and that Jeff Bezos has now. And, now,
they have Kaplan University is one of those for-profits that has a lot of
students default. Most of their students don`t get degrees.

They default and they get the money from the federal government. And,
their whole purpose is to get money from the federal government. This
money could be going to students, who are going to matriculate at not-for-
profit schools and/or go to pre-k, and we need that money there.

COHEN: I mean community college is available to people. You know, I,
again, it makes sense to invest in your education. The problem is that
these companies as you pointed out advertise widely. They make big claims
about being able to promise people access to better jobs, which typically
turn out not to be the case. And, so it`s true that the individuals should
be a better consumer --

HAYES: Right.

COHEN: -- but it`s also true that there are a lot of vulnerable
people out there who are being preyed upon. And, limited resources we have
in what these moneys are basically being flushed.

HAYES: Right.

COHEN: And, the president said they`re getting away like bandits on
Saturday. And, he`s right. They have dusters just like the James boys.

HAYES: Sema, let me ask you this. What -- So, you owe $11,000 to Trump
University? How are you going to pay that off? Where did you ended up?

TEKINAY: Well, what was interesting is that six months into this
program -- around 6 months as the program, I want my money back. I decided
this wasn`t going to be a road I can pursue with the limited amount. They
changed the course structure, and I opened my own Jewelry business in the
interim. So, I wanted my money back. They would not give me my money
back. And, I made a very big fuss about it. And, they said, "You know
what? If you`re opening your own business, let`s give you mentorship. We
have entrepreneurial mentorship. Now, I graduated from college. I have an
MBA from NYU. I have faculty access like I could get mentorship probably
at no charge. But, at any event, they gave me this entrepreneurial. And,
that`s what I got from my $10,000.

HAYES: They have that money.

TEKINAY: No. With no Jewelry experience. Yes.

HAYES: Is that your Jewelry right there?

TEKINAY: Yes, it is.

HAYES: Everyone, check out that Jewelry, Semi Tekinay,
Congressman Steve Cohen, Pedro Noguera from New York University, and Semi
Tekinay, a jeweler, a former Trump University student, thank you. That is
"All In" for this evening. "The Rachel Maddow Show" starts right now.
Good evening, Rachel.

RACHEL MADDOW, MSNBC HOST OF "THE RACHEL MADDOW SHOW: Chris, if you
needed to get in touch with Donald Trump, why didn`t you just ask me? It
is like you don`t know I hang out with him all the time.

HAYES: You could have texted him for me.

MADDOW: Exactly. I will hook you up. Don`t worry. Donald call me.

HAYES: Next time.

MADDOW: Yes. Thank you.

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

Copyright 2013 CQ-Roll Call, Inc. All materials herein are protected by
United States copyright law and may not be reproduced, distributed,
transmitted, displayed, published or broadcast without the prior written
permission of CQ-Roll Call. You may not alter or remove any trademark,
copyright or other notice from copies of the content.>

Discuss:

Discussion comments

,