updated 9/17/2013 5:00:52 PM ET 2013-09-17T21:00:52

ALL IN with CHRIS HAYES
September 16, 2013

Guests: Don Andres, Alan Grayson, Sherrod Brown, Heather McGhee, Alexis
Goldstein

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

And tonight, the country reels from another mass shooting, the worst
since Newtown, Connecticut, in December. It happened in our nation`s
capital -- the Washington Navy Yard, a complex of buildings a short
distance from the U.S. Capitol.

Tonight, at least 13 people are dead, including the gunman. Police
say another dozen are injured. Questions remain surrounding the alleged
shooter`s motive, who reportedly had a grudge against the Navy.

When the news first broke this morning, no one knew what this was --
confusion and chaos bringing the city to an absolute standstill. Here`s
what that looked like.

(BEGIN VIDEO CLIPS)

CHUCK TODD, MSNBC ANCHOR: Breaking news right now. Security forces
have just entered the building in search of a gunman who remains at large.
This is an active shooting. It`s here in Washington, D.C.

(SIREN WAILING)

UNIDENTIFIED MALE: We are hearing multiple shots being fired right
now. We did hear that there is an officer down. So, not only -- we don`t
know if this officer down is one of the three folks we heard that was shot.
But again, just seconds ago, we heard multiple shots being fired and then
officer down.

FRANK THORP, NBC NEWS: It seems right now people are rattled, but
right now there`s still a heavy police presence, SWAT vehicles are still
being driven into the Navy Yard. It`s being circled by helicopters here.

UNIDENTIFIED MALE: I just wanted to point out, more police assets
moving in here now, unmarked vehicles. This has been all morning.

UNIDENTIFIED FEMALE: Schools are in lockdown mode. U.S. Capitol
Police have increased security around the capitol.

UNIDENTIFIED FEMALE: Just three gunshots straight in a row, pop, pop,
pop. Three seconds later, it was pop, pop, pop, pop, pop. So it was like,
about a total of seven gunshots, and we just started running.

UNIDENTIFIED MALE: You heard that the traffic, the street traffic in
that area was shut down. The metro stations in the area were shut down,
the subway stations.

But we`ve also been told that the D.C. airport, Washington Reagan
National Airport, just across the river from the Navy Yard, has also
temporarily suspended operations.

UNIDENTIFIED MALE: Eyewitnesses reported what could only be a
horrifying scene.

UNIDENTIFIED MALE: As I was running, and I heard gunshots, and holy
cow. That`s -- I don`t know, it could have been way above me, but I wasn`t
stopping to think, you know, what was going on.

UNIDENTIFIED MALE: I was on the phone and somebody came over to my
desk and said, hey, this is not a fire alarm, somebody has been shot in the
building. So we ran around getting people out of the building, and as we
were exiting the back door, we noticed him down the hall. He stepped
around the corner, we heard shots. And as he came around the corner, he
aimed his gun at us and he fired at least two or three shots.

CHIEF CATHY LANIER, DC POLICE: The biggest concern for us right now
is that we potentially have two other shooters that we have not located at
this point.

So, right now, all we have on those potential other shooters -- and
this is not confirmed. We potentially may have two additional shooters out
there.

(END VIDEO CLIPS)

HAYES: It was a harrowing bit of information at the end of a news
conference earlier today.

And joining me now to sort through this is Michael Isikoff, NBC News
national investigative correspondent.

And, Michael, what do we know about the shooter, singular, the
possible suggestion of other shooters at this moment?

MICHAEL ISIKOFF, NBC NEWS NATIONAL INVESTIGATIVE CORRESPONDENT: Well,
first of all, on the possible existence of other shooters, the latest I`m
hearing is that that`s pretty much been discounted at this pot. There was
sort of out of an abundance of caution, the police chief mentioned it a
couple times based on some videos, but no other information suggests at
this point that this was part of some larger conspiracy.

We do know that the suspect had been a naval reservist, had enlisted
back in 2010, was discharged, had served at the naval command station at
Ft. Worth, 3rd petty officer, as some sort of aviation electricians work,
and then was discharged in January of 2011.

Now, just a couple months earlier, he had been arrested on misdemeanor
charges relating to accidental firing -- accidental firing of a weapon, but
those charges were not pursued. The D.A. did not -- did not bring charges,
and they were dismissed.

So, on its face, he had no, certainly no felony record. He had a
misdemeanor arrest but no conviction on that charge. But there has been
suggestions that that was -- that and perhaps some other things led to his
discharge in January of 2011.

One naval official, Navy officer was quoted today as saying there had
been a pattern of misconduct. That misconduct had not been specified.

A couple of quick things: first of all, just got a statement a little
while ago from Hewlett-Packard, the big computer firm, saying that Aaron
Alexis was an employee of a company called The Experts, a subcontractor to
Hewlett-Packard, on a contract to refresh equipment used on the Navy Marine
Corps intranet network. So, that may explain how he had access to the
base. He was employed by this company that was working as a subcontractor
with Hewlett-Packard.

Number two, spoke to with a federal law enforcement official not long
ago, says they believe the weapon, the AR-15, used in the shooting, had
been purchased recently, just within the last few weeks, at a Virginia gun
shop. No hard confirmation of what gun shop or that he was indeed the
person who purchased that weapon, but apparently, there is some evidence to
suggest that the weapon was purchased then.

HAYES: In terms of his history, we do know he has a history with
firearms. That has been established. Seattle police, I believe, also
putting something up on their blotter about an incident with Aaron Alexis
in Seattle a number of years ago, even going further back than the neighbor
in Ft. Worth.

But we don`t know anything so far, or nothing`s been released from
investigators about possible motive here, am I correct?

ISIKOFF: No, but there was some interesting interviews with friends
of his that at least pointed to possible motives. One was quoted as saying
that he had been -- Alexis had been upset with his employer for not paying
him for work in Japan within the last few weeks. It`s not clear whether he
-- what exactly the nature of that dispute was, whether he was -- why money
was being withheld, but that does -- some sort of disagreement with the
contractor.

The other thing, which is perhaps the most interesting that we`ve
heard so far is that he was a devotee of violent video games. And I think
one of his friends described him as obsessive on that, and playing with
them constantly.

Now, that`s at least one -- you know that does connect with Adam
Lanza, who was on the Newtown shooting, but there`s still a lot we don`t
know here.

HAYES: NBC News national investigative correspondent Michael Isikoff,
thank you so much.

All right, we`re going right now live to a press conference that`s
taking place in Washington, D.C. at the Navy Yard. It appears --

JUAN GARCIA, ASSISTANT SECY. OF THE NAVY: -- access availability for
counseling for all impacted by today`s events and any questions you might
have. Let me start with the current status on personnel still being
processed at the base, and let me ask the Admiral French to address that.

VICE ADMIRAL BILL FRENCH, U.S. NAVY: Thanks, Secretary.

My name again is Vice Admiral Bill French.

First of all, our thoughts and prayers go out to all the families and
friends impacted by this tragedy and event. Right now, we are, our
priority, our focus is on ensuring that those folks, primarily civilians
that are still on the base, are processed off in a very deliberate manner.
We`ve got great coordination from all those folks, both federal
organizations as well as those folks in Washington, D.C., that helped us
provide support for those individual civilians as they leave and go
primarily up to the Nats Stadium.

Nationals have gone out of their way, canceling a baseball game
tonight, as well as sending up food and support for all those folks going
there to get access to Metro, meet their family members to pick them up.

GARCIA: Tomorrow, the Washington Navy Yard will be open. Our plan is
to bring in mission-essential personnel only. That is essential personnel
only.

Liberal leave policy will be in effect, and personnel will be
encouraged to tele-work, but mission-essential only personnel will come to
the Navy Yard.

Now, tomorrow and this evening, we`ll also be making counseling
available to all those impacted by today`s tragedy. Uniformed personnel,
civilian personnel and their families, counseling will be available both at
Nats Stadium, parking lot B, as well as at JBAB, Joint Base Anacostia-
Bowling tomorrow and in the days to come. Transportation will be available
for all Personnel impacted to the base as well.

I`d like to give you a phone number so that all those impacted can
learn further details on how they can avail themselves of these services.
That number is 1-800-222-0364. That`s 1-800-222-0364.

Again, that`s counseling available free of charge for all personnel
impacted by today`s events -- uniformed personnel, civilian personnel as
well as their dependents.

Earlier today, the secretary of the Navy announced that he had
provided a blanket waiver for what`s called Sacnaf (ph) special designee
status for all personnel impacted by gunshot wounds today to avail
themselves of services at Walter Reed Naval Medical Center at Bethesda.

For -- I guess we`d also like to make a point of thanking the
community. The outpouring of support from the Red Cross, from the
Washington Nationals, who not only canceled today`s ball game but made food
and water and beverages available to folks who have been essentially locked
down on the base since 0700 this morning and who very likely will have
several hours to go.

Metro Police, the Metro itself who have made transportation available
free of cost to all our personnel, you see these buses continue to ferry
them back and forth.

What are we missing here?

FRENCH: I think that`s it.

GARCIA: OK.

If the admiral and I can provide further detail, we`d be glad to.

REPORTER: Your name and spelling.

GARCIA: Sure. Assistant secretary of the Navy, Juan, J-U-A-N,
Garcia, G-A-R-C-I-A.

HAYES: Joining me now is NBC News reporter Kasie Hunt, who is at the
scene today.

Kasie, what do we know, if anything, about who the victims are and
what the state of the city is at the moment?

KASIE HUNT, NBC NEWS REPORTER: We`re just starting to learn who the
victims were in this tragedy. This has been a day-long affair for
especially this particular neighborhood, but the city as a whole. A big
chunk of it essentially shut down for hours while they tried to figure out
just what was going on at the Navy yard.

I got here pretty early in the morning, not very long after there were
initial reports of a shooting. When I came in here, the buses were still
taking people from the Navy yard over to Nationals Stadium. You just heard
the official there from the Navy talking about how they`re going to have
counselors available there.

There was, of course, supposed to be a baseball game. The Nationals
were supposed to play the Braves. It was postponed, naturally.

But I spent most of the day talking to eyewitnesses, some of whom said
they had lost friends or that they knew that they had lost friends in the
shooting. They didn`t want to identify the victims yet, of course. That
will be something that will occur in due time. But the people that I
talked to described scenes of chaos and a lot of fear.

One man I spoke with was inside a conference room. They barricaded
themselves inside the conference room after they heard noises afar, and
eventually, there was a spray of bullets that flew through the top of that
conference room.

Another woman was in this open atrium that I know that we also saw
discussed.

HAYES: Do we know --

HUNT: Yes, Chris?

HAYES: Do we know where the shooting happened and who are the kinds
of people who were in the facility when it happened?

HUNT: Sure. It largely took place inside one building, preliminary
reports indicate. Still, there were questions about whether some shots
were fired in a different building.

But the building this occurred in is one that houses -- the Navy Yard
has a lot of civilian employees. It`s an administrative headquarters for
the Navy. It`s where the chief of naval operations lives. He`s the
highest ranking officer in the Navy.

So, most of the people who work there every day and who we saw
streaming out after they were finally released from being held in lockdown
were civilians. They weren`t people in uniforms. There were a handful of
sailors, a couple officers.

But for the most part, it looked like any other office building. It
would look like people in cubicles, like the normal people you would run
into on the Metro during the day. So, this doesn`t have the same feeling
as some military bases where it`s, you know, enormous units of military
personnel. Instead, it`s people who are doing sort of the day-to-day tasks
of running the Navy.

This particular building houses the unit that`s responsible for
overseeing the Navy`s fleet.

HAYES: That`s NBC`s Kasie Hunt. Thank you so much. Appreciate it.

HUNT: Thank you, Chris.

HAYES: Joining me now is Don Andres. He was an eyewitness. He`s a
congressional staffer for Nevada Congressman Steven Horsford and lives near
the navy yard.

Don, what did you say this morning?

DON ANDRES, EYEWITNESS: Sure. You know, I was running late for work
and I live in a building about a parking lot away from the Navy Yard
complex, and as I went downstairs in the lobby, I saw a lot of, as you
described earlier, civilian-dressed workers from the Navy yard. I asked
them what was going on and they said, you know, there`s an active shooter.
So, I proceeded to my car, trying to get myself to work.

As I come around the corner, I see what looks like police boats
circling in the Anacostia River, and that`s when I came on to New Jersey
Street and M Streets and that`s where I snapped some of the photos that my
colleague, Tim Hogan, posted of a man who was lying unattended at the
corner of New Jersey and M.

And again, like him posting the clarifying tweet, we don`t know
exactly what the injuries were. I couldn`t tell you what the nature of the
injuries were, but I snapped those photos. And in the midst of what was a
lot of pandemonium, a lot of folks coming out of the metro who worked at
the Department of Transportation, and that`s when I saw a lot of the first
responders barreling down M Street.

I saw the SWAT car, and then I saw some police peel off, got out of
their cars, begging folks to step away from the body and then started to
put the caution tape up. And that`s when two civilians ran over and looked
like they started to resuscitate him. I don`t know, again, the injuries
and that`s what we posted in the clarifying tweet.

Then, I went to the office and drove in and that`s when -- you know,
you could tell there was a lot of tension on Capitol Hill, the police were
more stringent in their searches, and had rifles drawn, and that alone
definitely put a lot of tension in the feelings of the staffers on the
Hill.

HAYES: There is a wall around the Navy Yard. It is a secure
perimeter. There`s only a few checkpoints, but it is also right in
essentially a residential neighborhood. It`s also next to some government
buildings near the Nationals ballpark.

So, there`s a lot of folks around that area and during a morning
commute typically, right?

ANDRES: Right, and I think the vast majority of them are coming in
via the Metro, right there on M and New Jersey, going to work at the
Department of Transportation.

And, otherwise, you`re right. It`s a very quiet neighborhood and very
residential.

HAYES: Don Andres, thank you so much for sharing that with us.
Thanks a lot.

ANDRES: Thanks, Chris.

HAYES: We`ll be right back.

(COMMERCIAL BREAK)

HAYES: You`ve been seeing all sorts of reaction online to today`s
shooting at the navy yard in Washington, D.C. If you`d like to post your
thoughts to this tragedy, you can do so on our Facebook page at
Facebook.com/allinwithchris. I`ll read some responses later in the show.

We`ll be right back.

(COMMERCIAL BREAK)

HAYES: So, another really scary and chaotic scene Saturday night in
the middle of what is probably New York City`s biggest intersection. At
48th and 8th Avenue, right near Times Square, NYPD officers were confronted
by a man labeled as agitated and disoriented, who seemed to be throwing
himself into the path of oncoming traffic.

When police tried to subdue the man, he apparently reached into his
pocket, pulled out his hand and pretended to shoot the officers as if his
hand was a gun.

I`ll let Police Commissioner Ray Kelly tell you what happened next.

(BEGIN VIDEO CLIP)

RAY KELLY, NYC POLICE COMMISSIONER: One officer fired one shot, not
striking the individual. Another officer who had responded to the s fired
two shots at the individual, also not striking him. However, two
bystanders on the northeast corner of 42nd Street and 8th Avenue were
struck by bullets fired by the officers.

(END VIDEO CLIP)

HAYES: Did you get all that? The suspect was not shot at all, but
those bullets fired from police guns found their way into the bodies of two
bystanders. One person was shot in the leg while the other was shot in the
buttocks.

Now, today, when news broke about the shooting at the Navy Yard in
Washington, D.C., almost immediately, gun advocates and conservatives
offered their own versions of the heroic miss made famous by the NRA`s CEO
Wayne LaPierre.

(BEGIN VIDEO CLIP)

WAYNE LAPIERRE, NRA: The only thing that stops a bad guy with a gun
is a good guy with a gun.

(END VIDEO CLIP)

HAYES: Just so you know, this weekend in New York, there were some,
quote, "good guys with guns," trained professionals in Times Square
Saturday night, who ended up putting bullets into the bodies of innocent
bystanders and not into the suspect.

This is not the first time something like this has happened. About a
year ago, two counterterrorism officers assigned to the Empire State
Building, the kinds of officers trained to respond specifically to
terrorist threats, shot and killed an armed murder suspect, but amid the
chaos, nine bystanders were also shot.

An 11-year study ending in 2006 that looked at the rate in which New
York police fired their guns found that officers hit their targets just 34
percent of the time. Now, take a moment and think about the mass confusion
that typifies mass shootings like the one that we saw this morning. A lot
of the time, w can`t tell how many shooters there are. Eyewitnesses are
contradicting each other.

Now add a bunch of armed citizens, not cops, but ordinary, armed folks
firing their weapons into that blur of panic and confusion. Take a second
and think whether that`s going to make things better.

But that`s the argument coming from some gun rights advocates. These
folks claim that killers methodically and deliberately choose sites where
firearms are prohibited, gun-free zones, where there will be nobody on hand
with a gun to stop them.

Almost immediately -- almost immediately after the navy yard shooting
was first even reported with the smell of gun smoke still hanging over
Washington, D.C., twitter was predictably bombarded with a barrage of
tweets supporting this unsubstantiated claim, quote, "Strange how every
single mass shooting happens in a gun-free zone. It`s almost like they
don`t work or something."

Then there was this tweet from one Robert Zimmerman, brother of George
Zimmerman, "It`s so an undeniable fact that areas sought out for the
massacres are areas with strict gun control like D.C., like today."

Actually, that is deniable. A "Mother Jones" investigation finds that
among the 62 mass shootings from 1992 to 2012, not a single case includes
evidence the killer targeted a place because it banned guns. And a study
conducted by Mayors Against Illegal Guns showed that in 56 mass shootings
between January of 2009 and January 2013, no more than 13 of the shootings
or 23 percent took place entirely in public spaces that were so-called gun-
free zones.

This reminded me of the exchange on the Aurora movie theater shooting
in Colorado, when Bill O`Reilly asked Bob Costas if Costas had been in that
theater, would he rather duck down and hide or be armed and have the
ability to defend himself.

(BEGIN VIDEO CLIP)

BOB COSTAS, NBC SPORTS: I don`t want to have a gun on me, no --

BILL O`REILLY: OK.

(CROSSTALK)

COSTAS: In that situation, in the dark, in the confusion --

O`REILLY: I respect that.

COSTAS: -- I think it`s highly more likely that there would be
additional carnage, bullets would be flying wildly all over the place.

(END VIDEO CLIP)

HAYES: This seemingly basic logic of not having a bunch of people
with loaded weapons in a crowded space is actually put into practice by the
people who run gun shows. From the Web site of Bill Goodman`s Gun and
Knife Shows, "For your safety, please make sure all magazines and weapons
are empty before entering a show. Patrons who bring loaded magazines or
weapons into the show will be refused entry and may be subject to
prosecution."

And I`d argue that same bedrock logic applies just as well outside of
gun shows.

(COMMERCIAL BREAK)

HAYES: Huge, good and welcome news for those opposed to war.
Possibly the single biggest diplomatic victory for the White House yet
happened this weekend. And we`re going to talk to a congressman who helped
bring it about, coming up.

(COMMERCIAL BREAK)

HAYES: We are not going to war with Syria any time soon. That is the
other big news coming out of Washington, D.C., today, news of tremendous
global importance and a huge victory for the Obama administration, thanks
to a deal hashed out between the U.S. and Russia that could or would
eliminate Syria`s chemical weapons.

Under the agreement forged between Secretary of State John Kerry and
Russian Foreign Minister Sergey Lavrov, Syria must now present a
comprehensive list of its chemical weapons within one week. International
inspection will begin in November, and all chemical weapons must be
eliminated by mid-2014th, the Syrian reconciliation minister said the
agreement would avoid war and was a victory for Syria. The next step is a
U.N. resolution formalizing the process and despite skepticism about Syrian
compliance, let`s all take a second to recognize that this is a pretty
amazing, peaceful resolution to what looked just a few weeks ago like an
intractable, international crisis building and excitably towards a deeply
unpopular military strike and further U.S. entanglement in a very bloody,
very brutal Mideast war.

It`s a solution as well to the precise and now a problem that
President Obama has identified, the need to reinforce the international
norm against the use of chemical weapons. And today, U.N. weapons
inspectors presented their report to the U.N. Security Council, finding
clear and convincing evidence that, indeed, the nerve gas sarin was used on
August 21st in a rocket attack launched in the suburbs of Damascus. And
while the report was not tasked with and does not draw conclusions about
who was responsible for the attack, reading between the lines of the report
suggest it was indeed the Assad forces.

As noted by Max Fisher, the Washington Post, "Chemical weapons were
delivered by munitions not used by rebels, but sarin was fired from a
regime-controlled area. Chemical analysis suggests this sarin likely came
from a controlled supply, that is, the sarin had chemicals in it
specifically indicates it was weaponized, the Russian rhetoric on the
artillery rounds strongly suggest they were Russian manufactured. And
while the news of a diplomatic resolution is being hailed by the American
public in a recent poll, there are of course war hawks who are disappointed
with recent events. Senator Lindsey Graham speaking in Chicago today on
the Syria crisis.

(BEGIN VIDEO CLIP)

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: I like John Kerry. John
Kerry is a friend of mine. He gave one of the most eloquent speeches a few
weeks ago about why we have a duty to get involved in Syria. Did you hear
that speech? Did you thought we were going to launch an attack the next
day? Me, too. What the hell happened? There`s a reason for 225 times
presidents use military force without coming to Congress. Have you
noticed? We`re dysfunctional. When they asked me about coming to
Congress, I said, please don`t.

(END VIDEO CLIP)

HAYES: Joining me now is Congressman Alan Grayson, a member of that
august body Lindsey Graham has so much faith in, he`s a Democrat from
Florida and he opposed the military action in Syria. It`s an incredible
thing for member of Congress to say. What`s your reaction to that?

REP. ALAN GRAYSON (D), FLORIDA: I think he should resign and do a
solid favor, if he thinks Congress is dysfunctional, he can make it a lot
better by leaving it. But putting that aside, this is the greatest victory
for enforcing peace since the end of the Vietnam war. We established an
important principle here, which is that you can`t take the public to war
without the public`s consent. It`s the public`s money, it`s the public`s
blood, and now we`ll finally see some public input and not have these
matters decided by Washington elites.

HAYES: And what I think is really interesting is that the way the
politics of this play out is that in the President`s decision to come to
Congress, what it did was it created space, it created an opening, right?
And it was into that space that this diplomatic solution rushed. And yet,
you will see people who say, well, this shows there is not enough strength,
and leadership and credibility, all these terms that have been used to
counter this kind of motion either by a president and other leaders.
What`s your response to that who look at this and say, oh, this is a sign
of weakness?

GRAYSON: No, not at all. The president acted upon a humanitarian and
positive impulse. And I understand. We disagreed about the efficacy of
what he proposed, but not the fact that something needs to be done to
relieve the suffering in Syria, and that`s sign of strength. As the
President said, we are a nation of people who care, and that`s good to
know. Unfortunately, I think the President could not come up with a war
plan that could reach any sort of consensus within Congress. The last
count is 25 House members in favor, 263 against, but that doesn`t change
the fact the President wanted to do something positive to relieve suffering
and we respect him for that.

HAYES: There is fascinating polling out of pew today, which basically
said here`s where the public is on this, in the wake of this announcement.
They support the deal quite a bit, overwhelmingly. They also think they
don`t trust Syria, and they don`t trust Russia and they don`t think it`s
going to get rid of chemical weapons. I thought it was such an interesting
mix of public opinion, because it seemed to precisely capture how
complicated people`s feelings are about the situation in general. Does
that sync up with what you generally sense?

GRAYSON I think so. I remember a poll saying that 57 percent of the
people who supported attacking Syria thought it would do no good.

(LAUGHTER)

HAYES: Right.

GRAYSON: That`s where we are right now. But unfortunately -- well
fortunately, we`ve come up with a procedure, a plan that actually might
eliminate chemical weapons in Syria. The fundamental problem with the
administration`s proposal is that it would not have done that, it would not
have prevented a new attack, it would even have reduced the supply, the
stockpile with chemical weapons in Syria. Now we have a way to do that, a
good plan is much better than no plan or a bad plan.

HAYES: Right, and that I think is an important point to point out.
That even the punitive strike that was on the table before, even if it did
as was being suggested by those who are engineering it to create the
capacity to deliver them, there was no identification procedure, there was
no the Assad regime coming forward, admitting they have chemical weapons.
In some ways, this is a more positive outcome from the perspective of
weapon deterrence than what was on the table with the military strike.

GRAYSON: No, the fundamental problem with the military strike is that
it would probably have led to proliferation. It`s the extent that it would
have reduced command and control by the Syria and over their own supply,
you would have seen these weapons fall into the hands of the rebels and
other forces, and that was a terrorist coup that could not be accomplished
any other way, and that was very much on the minds of people in the
Congress as well as the fact that we could not predict or control what the
Syrian response would be. Would they attack U.S. civilians? Would they
attack the navy fleet? Would they attack our embassies in Baghdad or in
Beirut? They have a lot of options. Would they attack our ally in Israel
or Turkey or Jordan? We could not predict that. This is the way forward
that actually runs none of those risks.

HAYES: There was a "New York Times" headline about the fallout from
this deal. It says, deal represents turn for Syria, rebels deflated. And
the conceit of the peace and I`ve seen a number of commentators informed
once, reported in region, basically say, the rebels are taking this
harshly. They think this is bad for them, that this gives Assad
credibility. Is there a twinge of regret you have as someone who was so
outspoken in opposing the war, who I think played an instrumental role in
getting the political system to this point where we`re now sort of happy
about this deal, is there any twinge of regret when you read that headline?

GRAYSON: Which rebels are we talking about? Are we talking about the
al Qaeda graduates? Are we talking about the anti-Semites? Which group
are we talking about? No, we can`t make our decisions that way. We have
to protect Americans. We have to protect America. We have to protect our
allies. I can`t make up my mind and determine my vote based upon whether a
particular group in Syria is for or against it. That is completely
irrelevant.

HAYES: Congressman Alan Grayson of Florida, thank you so much for
your time.

GRAYSON: Thank you very much.

HAYES: A huge surprise in the race for most powerful man in the
global economy, Senator Sherrod Brown, who played a key role in this
surprise, is going to join me. He`ll talk about it.

(COMMERCIAL BREAK)

HAYES: Today, President Obama marked what is recognized as the five-
year anniversary of the financial collapse of 2008. In a speech this
afternoon, he touted a more stable, growing economy but acknowledged much
more work to be done. Much of that work will come from the Federal
Reserve, whose future leadership is very much in question after the
President`s reported top choice for the job, Larry Summers, took his name
out of the running.

(BEGIN VIDEOTAPE)

LARRY SUMMERS, FORMER US TREASURY SECRETARY: It is been said
occasionally that I can be arrogant.

Of all the introductions I have ever received, that was surely the
most recent.

That question was both predictable and a good try.

They want to sell me the books for the franchise.

One of the things you learn as a college president is that if an
undergraduate is wearing a tie and jacket, there are two possibilities.
One is that they are looking for a job and have an interview. The other is
that they are an (bleep) hole.

(LAUGHTER)

HAYES (voice-over): For all his unanimously acclaimed brilliance,
Larry Summers is not someone who`s won any popularity contests with his co-
workers throughout his long career.

UNIDENTIFIED MAN: Of Larry Summers, I think he had a long history of
arrogance and relative ignorance about poor people`s culture.

UNIDENTIFIED WOMAN: I don`t think it`s any secret that Larry was not
my first choice.

HAYES: Despite his habit of alienating colleagues, Summers also
accounts some of the most popular people in the world as his supporters.

PRES. BARACK OBAMA (D), UNITED STATES: Larry summers did a heck of a
job trying to figure out how to --

JON STEWART, HOST: Do you don`t want to use that phrase, do you?

(LAUGHTER)

HAYES: There`s an excellent reason Jon Stewart gave the President a
hard time about Larry Summers. That`s because through his professional
career, Summers has been destructively and demonstrably wrong on many of
the biggest policy issues he faced. He was wrong about derivatives
regulation while working in the Clinton administration, where he famously
stone-walled regulator Brooksley Born, who asked questions about the lack
of oversight of the derivatives market.

BROOKSLEY BORN, FORMER CFTC CHAIR: I thought asking questions
couldn`t hurt, and I was shocked that there was a strong, negative reaction
to merely asking questions about a market.

HAYES: Born turned out to be prophetic. The issue she identified and
that Summers ignored were what played the central role in the great crash.
After his tenure in the Clinton White House, Summers then moved on to an
ill-fated run as the president of Harvard where he made bad bets on
interest rates while running the Harvard endowment that eventually cost
the school nearly one billion dollars. It was also as Harvard president
that Summers hypothesized that the lack of women in the science and
engineering field could be attributed to quote, "issues of intrinsic
aptitude."

UNIDENTIFIED WOMAN: That the president of this great university
should say that in his opinion, an explanation for why there is a lack of
women at the top of any profession is aptitude differences between men and
women, I was quite shocked.

HAYES: From there, Summers went to work under President Obama, where
as a member of Obama`s transition team, Summers fought with fellow economic
adviser Christina Romer over the appropriate size for a post-crash economic
stimulus package. While Romer calculated that restarting the American
economy would require more than a trillion in stimulus, Summers managed to
bring the proposal down to around 800 billion.

That was the second time Larry Summers fought with a powerful woman
who was right, but somehow lost the argument to Summers, who was wrong.
And until this weekend, it looked like Larry Summers was going to ascend to
the most powerful economic job in the entire world, chairman of the Federal
Reserve, over the eminently qualified current Fed Vice Chairwoman Janet
Yellen.

UNIDENTIFIED WOMAN: Saying markets are in rally mode this morning
following Larry Summers dropping out of the running for Fed chair.

HAYES: But the backlash against Summers` nomination grew so strong,
particularly among the left, this past weekend, Larry Summers shocked
almost everyone watching by withdrawing his name for consideration.

(END VIDEOTAPE)

HAYES: Yesterday, Larry Summers wrote in a letter to the President,
quote, "I have reluctantly concluded that any possible confirmation process
for me would be acrimonious and would not serve in the best interests of
the Federal Reserve, the administration, or ultimately, the interests of
the nation`s ongoing economic recovery."

Joining me now is Senator Sherrod Brown, democrat from Ohio, on the
Senate Banking, Housing and Urban Affairs Committee where he is chaired the
sub-committee a financial institutions and consumer protection. Senator
Brown, was this your doing?

SEN. SHERROD BROWN (D), OHIO: Of course it wasn`t my doing. I
circulated a letter a few weeks ago on the Senate floor, about 20 of my
colleagues signed it in support of Janet Yellen, because the Federal
Reserve has two functions. One is to dampen inflation, to keep inflation
under control. The other is to do all they can to enhance employment and
work towards a full-employment economy. And the second part of that
responsibility is not emphasized enough. I`m confident, as I assume the
other 19 senators that signed that letter are confident, that Janet Yellen
will do that. It`s the president`s choice. My job is to vote for or
against the nominee, but it was to us, I think Janet Yellen will do a good
job, but it`s the President`s call.

HAYES: There has been reporting that there were a number of no-votes
on your committee from Democrats. I mean, you and I have both been
following this story, and you and I both know that circulating a letter in
favor of Janet Yellen amidst all the speculation about Larry Summers sends
quite a clear message. I mean, were there back-channel communications at
the White House from you or from the committee about Summers?

BROWN: There were none from the committee that I know of. I don`t
speak for the chairman. There were certainly discussions between members
of the Senate and people in the White House, perhaps with the president
himself. I did not have a discussion with the President about Larry
Summers or Janet Yellen, for that matter. It`s unusual for senators to
weigh in on something like this, and the discussions about Larry Summers
really came mostly after that letter, but I think that the importance of
that letter was simply that a number of the senators said to the president
of the United States, we think that employment is at least as important as
keeping inflation in check, and we think there should be a Federal Reserve
-- there should be a fed chair who fits that bill. We thought Janet Yellen
did and still do think that. But again, it`s the president`s call, as you
know, Chris.

HAYES: There`s a really interesting situation playing out in which
this is now the most covered, the most watched Fed chair race ever. And I
wonder whether you think this tremendously powerful position is benefiting
from more public attention?

BROWN: You know, I think the more the public knows about this, the
better, because I mean, we`ve seen some of the Fed chairs. The one that
chairs -- well, the one that stands out particularly was Alan Greenspan,
who got to be well known, but clearly wasn`t had very little focus on what
he needed to focus on, and that was full employment. His focus was on
deregulation and, secondarily, I think keeping inflation in check, and what
the damage he did with deregulation that markets are self-correcting, for
which he later apologized in front of a House Committee, I think is
particularly significant.

But the important thing to me is whomever the President appoints, the
questions about keeping attention on full employment and the Fed playing a
role as a regulator to make sure that these Wall Street banks, which are
getting bigger and bigger, their wealth and power is unprecedented, the
banks are again on Wall Street engaging in risky behavior, calling in many
cases, meaning federal taxpayers subsidizing these largest Wall Street
banks. I want a fed chair that`s going to go after that and make sure that
the banking system is more solid than it`s been over the last decade or so.

HAYES: You make a great point, which is that under Dodd/Frank, the
regulatory supervision of the Fed chair is even larger than it was in the
past. Senator Sherrod Brown of the great state of Ohio.

BROWN: Thanks, Chris.

HAYES: Thank you so much. We`ll be right back.

(COMMERCIAL BREAK)

HAYES: Earlier in the show, we asked to hear your reaction to today`s
mass shooting at the Navy Yard in Washington, D.C.

We got a ton of answers posted to our Facebook page, including Shane
C. Woodbury says, "We have easy access to guns this country and not so easy
access to mental health in this country. Until these changes, we can
expect more senseless tragedies like today in America to occur. Wake up,
America."

And Anne Ilka Almentrout says, "Here we go again. And once again, the
nation will go through a process of grief and mourning and hand-wringing,
only to come out the other side knowing that nothing, not reason, not
practicality, not compassion, trumps the unrestricted right by whatever
people in whatever circumstance to have whatever guns they want."

We`ll be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: Even though our businesses are creating new jobs that have
broken record profits, the top one percent of Americans took home 20
percent of the nation`s income last year, while the average worker isn`t
seeing a raise at all.

(END VIDEO CLIP)

HAYES: That was the President speaking earlier today about the
unequal gains made five years since the great recession. Joining me now is
Heather McGhee, vice president of the progressive think tank Demos. Alexis
Goldstein who used to work on Wall Street, now a member of Occupy Wall
Street.

Heather, we just talked to Senator Brown about Larry Summers. Very
un-expected, very surprising announcement this weekend that shocked me when
I saw it come in on an alert on my phone. The left was in revolt over
Larry Summers, but they`re always in revolt about something, and it never
works. Like, what happened here?

HEATHER MCGHEE, VICE PRESIDENT, DEMOS: I think it was really just
sort of the linen up of really top-tier folks and not just the economic
left, but you had the women`s movement, you had university presidents
coming out. You had a lot of people saying, you know what, this won`t
stand. And one of the key pieces I think was that you had someone from
Montana. The senator from Montana, tester, who`s really very close to the
community banking sector saying, you know, what? The little banks in the
country don`t want this Wall Street guy.

HAYES: Well, OK, so you just said Wall Street guy. And Alexis,
here`s my counterargument. The way that this race is being talked about is
Larry Summers, evil puppet of Wall Street big banks. Janet Yellen, good,
progressive, folk hero who will fight for us normal people. And yet,
here`s what happened in international markets. When Larry Summers
announced that he was retracting his name, they rallied, because Wall
Street actually prefers Janet Yellen over Larry Summers. Explain that one
to me.

ALEXIS GOLDSTEIN, OCCUPYNETWORK.COM: I don`t think that that`s
exactly what`s happening. I think there might be some on Wall Street who`s
concerned that someone as fiery as Larry Summers might make the financial
markets more volatile just because he`s more volatile. But I think the
reason that we saw the market`s rally is, look, the Obama administration
has not been that creative in doing their appointments. Yellen is from the
Clinton administration, and there was a photograph that the "Washington
Post" circulated that showed us that Obama`s economic team is really no
different than Clinton`s and Janet Yellen is a part of that.

And so, yes, if the best that we can do is recycle people from
Clinton, is Janet Yellen the best pick? Probably, but it would be great if
we could be a little more creative in our selections and look at where the
country is right now. I mean, Obama seems to know that there is this
populist anger about all the wealth going to the top, but is he really
doing anything in his policies?

HAYES: No, but I want to push back on this, because I think the way
that this is pictured, and we`re talking about monetary policy, which is
just complicated, but extremely important, particularly with Congress
broken, which nothing`s coming out of the Boehner Congress except terrible,
horrible things for the macro-economy, that the idea is that we think of it
as zero sum. It`s Main Street versus Wall Street, right? But actually,
loose monetary policy, right? The Federal Reserve trying to stimulate the
economy is actually good for Wall Street and also good for Main Street.
It`s possible we`re not looking at the zero sum situation.

MCGHEE: Right, and I actually think it`s been a little bit oversold,
the idea that Summers would somehow be more hawkish on monetary policy.

HAYES: Hawkish means more concerned about inflation than full
employment.

MCGHEE: Exactly. I don`t think he would do that. I think he feels a
need to, quite frankly, probably keep the administration`s record of job
growth going. But the thing is, unfortunately, the way our deregulated,
bloated financial sector works, actually, the money going through, from the
Fed through Wall Street isn`t getting enough to Main Street. So, in fact,
this easy money policy has been absolutely the best thing we could hope for
because direct job creation and better policies out of Congress are not
going to happen, but it`s actually not getting the Main Street in the way
that it can and being gummed up in the sort of system that`s going on with
Wall Street the way is with speculation.

HAYES: Alexis, I want you to -- yes.

GOLDSTEIN: And this is a point -- sorry, this is a point that Sheila
Bair has made, is that the zero interest rate policy basically incentivized
the banks to just reinvest their money in treasuries, because that`s less
risky than actually loaning it out to the American public. So, that policy
has been terrible for Main Street. So, I do think that we do have a Wall
Street-Main Street split going on here.

HAYES: Wait. But do you want to see the next Fed chair tighten?

GOLDSTEIN: I want to see the next Fed chair take advantage of all of
the things that Sherrod Brown mentioned that Dodd-Frank took advantage of.
There is an army of people at the Fed that can do monetary policy. Where
there is a gap is whether or not someone is actually going to be serious
about some of the new powers that they gave it under Dodd-Frank like the
living wills or the stress test, and I think that that is going to be more
helpful to our economy, if we create a safer economy where we don`t have
too big to fail banks than whether we`re dovish or hawkish on monetary
policy.

HAYES: And this is a key thing that`s gets lost in the debate when
people are covering the debate about the Fed chair, particularly because it
usually comes out of the financial process exclusively and it comes out a
lot of traders making trying to make bets on which direction interest rates
will going to go and whether money is going to be loose or tight, is this
huge regulatory role of the Fed chair.

MCGHEE: Yes.

HAYES: I mean, you are essentially the regulator of last resort for
the entire industry, right?

MCGHEE: Yes. I mean, let`s think, I mean, even before Dodd-Frank,
which Alexis and I worked really hard on, actually gave a lot more power to
the Fed and didn`t deal with some of its conflicts of interest if we would
have liked to have seen. Before Dodd-Frank, for 14 years, the Federal
Reserve could have stopped subprime lending in the predatory mortgage
crisis. It sat on its hands because --

HAYES: It could have done it. It really could have done it. Have
the power to do it.

MCGHEE: It had the power to do it under hope that -- I won`t do this
for your viewers, but it had the power, and in fact, was the only real
regulator that had the power to regulate subprime mortgages for 14 years,
basically could have prevented the foreclosure crisis.

GOLDSTEIN: And just really quickly, post Dodd-Frank, the Fed has the
power to break up banks and to split them up into Glass-Steagall like
entities, if it wanted to.

HAYES: Yes. And that power actually remains, and I think that`s the
sort of underappreciated aspect of who the next person`s going to be.
Incredibly important position, the most important economic position not
just in the country, in the world.

Heather McGhee from Demos and Alexis Goldstein from Occupy Wall
Street, thank you both. All right, that is ALL IN for this evening. "THE
RACHEL MADDOW SHOW" starts right now. Good evening, Rachel.

RACHEL MADDOW, HOST, "THE RACHEL MADDOW SHOW": Good evening, Chris.
Thank you very much. And thanks to you at home for staying with us this
hour. Today`s mass shooting at the Navy Yard facility in Southeast
Washington, D.C., makes today the deadliest day in our nation`s capitol in
more than 30 years.

January 1982 was when a 737 that had taken off from National Airport,
what we now call Reagan Airport, crashed into the 14th Street Bridge in
Washington and then into the icy Potomac River. Seventy eight people were
killed in that crash that day, including four people who had been on the
bridge or on the ground and were hit by the crashing plane.

Incredibly, that same day in Washington, D.C., back in 1982, the same
day as the plane crash, also saw a fatal derailment of a subway in the
city. Three people were killed when the metro derailed in a downtown
tunnel. Those accidents both happened on one day in Washington. But that
terrible day in Washington was 31 years ago.

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