updated 9/24/2013 11:31:57 AM ET 2013-09-24T15:31:57

ALL IN with CHRIS HAYES

September 23, 2013
Guests: Sheldon Whitehouse, Jeremy Scahill, Kayla Williams, Ben Domenech,


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

Tonight on ALL IN:

Republican Senator Ted Cruz is quickly becoming notorious in
Washington for being hated by everyone except himself.

Also tonight, the latest on the terrorist attack in Kenya. Just a few
hours ago, Kenyan officials said that after three days, the siege was
finally over.

Plus, a blockbuster expose of the Clintons, a piece I`m sure the
Clintons wish had never been written about a guy they`d rather you not know
about. The author of that book is here.

Those stories are ahead.

But, first, we begin with the great Ted Cruz backlash of 2013.
Tonight, Minority Leader Mitch McConnell announced he will not support Ted
Cruz`s long-shot strategy to filibuster the budget resolution in the U.S.
Senate. That`s a rapid change of fortunes for Cruz, who just a short week
ago was celebrating his improbable victory in which he almost single-
handedly pushed house speaker John Boehner to do something he manifestly
did not want to do, pass a continuing resolution that would defund
Obamacare.

But Ted Cruz`s biggest victory in his very short senatorial career
could be his biggest defeat, revealing that there was an entire lake of
contempt for Ted Cruz out there just waiting for the dam to burst. And
this week --

(BEGIN VIDEOTAPE)

CHRIS WALLACE, FOX NEWS: This has been one of the strangest weeks
I`ve ever had in Washington, and I say that because as soon as we listed
Ted Cruz as our featured guest this week, I got unsolicited research and
questions not from Democrats but from top Republicans.

HAYES (voice-over): FOX`s Chris Wallace may have been shocked by the
Republican oppo research dump on Ted Cruz, but it`s a sign of the time. As
of this week, all of Washington, D.C., is in open revolt against the junior
senator from Texas.

KARL ROVE, REPUBLICAN STRATEGIST: A U.S. senator called me yesterday
morning, said, "I`m going to be watching senator Cruz on `FOX News Sunday`
because I don`t know what his next step is."

SEN. DICK DURBIN (D), ILLINOIS: Those who are pushing to shut down
our government include a senator from Texas who has a Harvard law degree.
I assume that in the course of his Harvard education, he learned how to
count to 60.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: I didn`t think it would be
smart to send the house bill to the Senate and we filibuster our own bill.

SEN. HARRY REID (D-NV), MAJORITY LEADER: One senator, a Republican
senator, said it`s the dumbest idea he ever heard.

SEN. CHARLES SCHUMER (D), NEW YORK: Ted Cruz has climbed out on a
limb, and now it`s getting sawed off.

SEN. TOM COBURN (R), OKLAHOMA: Tactics and strategies ought to be
based on what the real world is, and we do not have the political power to
do this.

HAYES: Today, Greg Sargent of "The Washington Post" reporting a quote
from a House Republican aide that compared Ted Cruz to one of the great
bullies in modern pop culture. "They, Cruz and his allies, "are
reminiscent of the Cobra Kai team in Karate Kid, `sweep the leg, sweep the
leg!` because they are unwilling to get into a Karate fight of their own."

Just to play that analogy out, Johnny, representing House Republicans,
listened to his sensei, representing Ted Cruz --

UNIDENTIFIED MALE: Swept the leg.

HAYES: -- and swept the leg. However, Daniel LaRusso, i.e.,
President Obama, appears ready to crane kick Republicans in the face and
take home the big trophy, in this case, Obamacare.

But that said, all of this villainizing is what Ted Cruz wants,
because for Ted Cruz, being the most hated man in Washington is a badge of
honor.

What is not a badge of honor is being viewed as a snobby, over-
credentialed jerk. And that is the picture of Ted Cruz painted vividly in
a new "GQ" profile out today, which notes as a law student at Harvard,
Cruz, "refused to study with anyone who hadn`t been an undergrad at
Harvard, Princeton or Yale. Says Damon Watson, one of Cruz`s law school
roommates, he said he didn`t want anybody from minor Ivies like Penn or
Brown."

While working for George W. Bush`s campaign, he was also known for
dispatching regular updates on his accomplishments that one recipient
likened to "the cards people send about their families at Christmas, except
Ted`s were only about him and were more frequent."

"GQ" also retells the story of the oil painting Ted Cruz has hanging
in his Senate office. It`s a story Ted Cruz had previously told ABC News
and one that Stephen Colbert knocked down handily.

SEN. TED CRUZ (R), TEXAS: I have always liked the fact that I sit in
my office and I look at a giant painting of me getting my tail whipped 9-0,
and it is very good for instilling humility.

STEPHEN COLBERT, COMEDIAN: Yes. I`ve got to tell you, I don`t know
what part of this painting comes off as more humble. Is it the hint of
halo surrounding his head or is it look toward heaven, or is it all the
people in this painting of him who are painting more paintings of him?

HAYES: But while Ted Cruz may have earned the ire of Democrats and
Republicans alike, he has found one stalwart ally. After defending Cruz on
FOX, Sarah Palin jumped fully into the bunker with him, tweeting at FOX
News Sunday night, "Keep it truly fair and balanced. Release the GOP names
encouraging you to trash Senator Ted Cruz. No more anonymous sources."

(END VIDEOTAPE)

HAYES: The backlash against Ted Cruz, however, has not slowed him
down. Earlier today on the Senate floor, he continued to play the part,
laying into Harry Reid and Senate Democrats.

(BEGIN VIDEO CLIP)

CRUZ: We all know that 3 1/2 years ago, Obamacare was forced into law
on a strict party-line vote, by straight, brute force. But it shouldn`t be
funded that way. That`s not the way a government should proceed.

(END VIDEO CLIP)

HAYES: Joining me now is Senator Sheldon Whitehouse, Democrat from
Rhode Island and a member of the Senate Budget Committee.

And I want to talk budget process with you, which, man, will that keep
the viewers around. But before we get to that -- no, because I have to
confess, I do this for a living, and I am so G.D. confused. I want you to
explain things to me.

But first of all, I have to get your response to Ted Cruz on the well
of the Senate, forced into law, straight, brut force.

Is that -- is that your constitutional understanding of how Obamacare
came to be?

SEN. SHELDON WHITEHOUSE (D), RHODE ISLAND: Well, I think it went
through both the House and the Senate, bicameral procedure. And I would
note particularly that in the Senate, this was actually quite a bipartisan
effort at the beginning, until the message came down to the Republicans to
walk away at all costs.

And we did hundreds of amendments in committee, many of them
Republican amendments. So, it`s a little bit like the orphan throwing
himself on the mercy of the court, having killed his parents to say that,
you know, this was rammed down our throats because we all decided to walk
away from it in order to damage the president.

HAYES: OK.

WHITEHOUSE: It takes a bit of nerve.

HAYES: So, here`s my question. You`ve got -- the House has sent you
over a continuing resolution. The Senate is now scheduled to vote on a
continuing resolution that`s going to keep the government open. And it`s
looking like it`s not going to be voted on probably properly until Friday,
I`m understanding, or maybe over the weekend?

Am I wrong that there is, the clock is running out to avoid a
shutdown?

WHITEHOUSE: There are one or potentially two cloture votes that may
be required, and each one of those cloture votes locks in a 30-hour period
for debate. Unless the Republicans yield back that time, you could have to
burn all of those hours, and that could run it into Friday, conceivably,
depending on the delaying tactics that they use. You could even run it
into the weekend, but we`re hoping that they`ll make their points and be
reasonable and move on, so that you don`t get to a real hair`s breath
cliffhanger with something as important as an American government shutdown
at stake.

HAYES: Senator, you just said we hope they`re going to make their
points and be reasonable and move on.

WHITEHOUSE: I know.

HAYES: That strikes terror in my heart if that is the game plan.

WHITEHOUSE: It hasn`t been the recent record, but you know, this is a
fight that sooner or later had to come. The sensible and moderate
Republicans are fed up and furious with having been bullied and hectored
and lectured by the Tea Party fanatics. I think what you`re seeing with
Ted Cruz is general blowback against the Tea Party fanaticism and how
bullying they`ve been of their colleagues. If you look around the
Republican Caucus rooms, most of the bodies hanging in the corner of lost
colleagues were taken out by Tea Party attacks, not by Democrats.

And so, I think a lot of the moderate Republicans have just plain had
it, and they`re pushing back, and it will be really good for our country if
they successfully push back. A lot of them have been afraid of these Tea
Party guys for too long because they`ve looked at their colleagues who lost
primaries and think, oh, gosh, better keep my head down and not cross these
guys.

But I think this is getting to be that tipping point where they`re
really fed up and want to go back to being a rational party again.

HAYES: Is there some part of me that shouldn`t be won over by someone
who destroys the kind of clubby collegiality of the Senate? Because
there`s part of me that thinks, like, obviously, Ted Cruz stands for
everything I don`t understand for substantively, but I also kind of like
someone who is making his colleagues angry, because that body seems so
fricking dysfunctional to me, and I`ve got to think there`s something to
it. If everyone is mad at you in the Senate, then maybe you`re doing
something right.

WHITEHOUSE: Yes, well, the problem is that it`s dysfunctional because
of this constant extremism that comes up.

HAYES: Right.

WHITEHOUSE: And I don`t think the cure for that poison is a worse
dose of that poison.

HAYES: That`s a very, very good point. Senator Sheldon Whitehouse,
thank you so much. Enjoyed it.

WHITEHOUSE: Thank you.

HAYES: Joining me now is Michael Steele, MSNBC contributor, former
chairman of the RNC.

All right, I am, like I was telling you before we get on camera, I am
fascinated by the Ted Cruz -- Ted Cruz as a polarizing figure.

MICHAEL STEELE, MSNBC POLITICAL ANALYST: Right, right.

HAYES: Why are people so -- why is he so polarizing right now among
conservatives and Republicans?

STEELE: But, look who you`re talking about. You`re not talking about
rank in file Republicans out there. You don`t see the uproar and
consternation coming from grassroots activists around the country, the
Sarah Palin wing of the party. You don`t see that.

This is the establishment.

HAYES: Right.

STEELE: This is what you just -- the point you just made. Well, you
know, if he`s getting the old folks all fired up, there must be something
to it, and that`s his mindset. His mindset is to go and to change the
system to force it to look at itself and deal with new realities.

HAYES: All right, you sound sympathetic to him, but this has always
been, every sin person --

STEELE: I`m always with the outlier, you know.

HAYES: Well, you`re with the outlier, but I also feel like you have
run head long into what the demands the base make, which can sometimes be
difficult to heed --

STEELE: And they can be.

HAYES: -- and run a successful party, and this is a breaking point
moment. You have tom Coburn, and Tom Coburn is no squish.

STEELE: True conservative.

HAYES: This is strategic suicide.

STEELE: And now, keep in mind, there is a general strategy that is a
political strategy by the party officials to move this legislation or to
block legislation, and then there is the personal strategy which tends to
fall a little bit more into the Ted Cruz camp, which puts him in the
position, he`s the driver, he`s the main focus of the debate.

It`s not the issue. It`s not the substance of the argument. It is
what the man himself is all about.

And so, I think what Ted needs to do at this point, you got our
attention. Now back off. And begin to bring the leadership around to a
different kind of solution --

HAYES: But there`s no -- that`s the thing --

STEELE: There`s nobody doing that, right.

HAYES: I don`t think he understands. Obviously, everyone says what a
smart guy he is. And I actually have seen him argue in the Supreme Court,
I was blown away by how good he was.

But he doesn`t seem to understand the procedure at play here. Like,
the things he was telling Chris Wallace in the interview this Sunday didn`t
make a ton of sense. He`s backed himself into a procedural corner. There
is no game plan.

STEELE: Again, when you are taking yourself outside of the process so
far that you can`t wrap back around into it, you have this problem where
you`re standing there alone, which is where he is right now, and where even
the base that you have inside the membership, inside the club, is not
feeling it.

HAYES: So, here`s my question. Obviously, this helps him with the
conservative grassroots.

STEELE: Oh, yes.

HAYES: If he is hated, if John McCain hates him and we`re beating up
on him on MSNBC, this is all --

STEELE: Oh, he`s loving it.

HAYES: There`s my question. The "GQ" profile, the fascinating thing
about Ted Cruz is he is a creature of the grassroots, but he is as much a
creature of the American elite as any single politician in American today.
I mean, the guy is credentialed up the wazoo. And when you read those
quotes in "GQ" about I won`t study with anyone who didn`t go to Harvard,
Yale or Princeton, that doesn`t play very well with the conservative
grassroots, does it?

STEELE: How about the brother from the community college? He liked
to get a little bit of the Harvard glow flowing his way.

And you`re right, that`s the sort of elitism that doesn`t get exposed
too readily, that you have this bifurcation of personality. I have my
grassroots --

HAYES: That`s exactly right.

STEELE: I`m down with the people, but only after I have my latte.

HAYES: Right.

STEELE: So, that`s the problem.

HAYES: Do you think he`s vulnerable there?

STEELE: I think so. I think ultimately, it becomes like Swiss
cheese, holes that you can go in through and have a problem with. He`ll
have a problem with down the road. But that`s if he does a presidential
race, because as you saw, they get into the oppo research out on the guy
already.

HAYES: I know.

STEELE: So, there clearly is a button that`s been pushed within the
party by him. The question for him now is does he back it down? He got
everybody`s attention. Does he back it down and begin to play so we don`t
walk into this trap on Monday.

HAYES: So, here -- that`s the trap on Monday. There`s two options
for him, quickly, which is that if this thing resolves and they pass and
continue a resolution that funds Obamacare, he gets to be the great hero in
defeat, right?

STEELE: Right.

HAYES: But if there`s a shutdown and there`s a huge backlash against
the Republican Party and the bluff is called, then he is in trouble.

MSNBC contributor --

STEELE: It`s called SOL, my friend.

HAYES: That`s right. That is exactly right. MSNBC contributor
Michael Steele.

STEELE: Good to be with you tonight.

HAYES: Always a pleasure.

At last, some huge, good news out of Kenya, where there`s been a major
development in the hostage situation in the mall in Nairobi that has been
site to one of the most horrific attacks on civilians we`ve seen. We`ll
bring you the latest and talk to a journalist who has been shot at by the
alleged masterminds of the attack, next.

(COMMERCIAL BREAK)

HAYES: We always love hearing from you on Facebook and Twitter. For
tonight`s question, I want to ask you about our good, good friend, Senator
Ted Cruz. We just keep learning new things about the guy.

So, here it is. What is the next great biographical nugget we will
find out about the junior senator from Texas? Take your best guess, be
creative. This is a fun one.

Tweet your answer to @allinwithchris or post
Facebook.com/allinwithchris. I`ll share a couple at the end of the show
and we`ll be right back.

(COMMERCIAL BREAK)

HAYES: At this hour, Kenyan security forces claim to be in control of
the Westgate premier shopping mall in Nairobi, Kenya, the site of one of
the most horrifying terror attacks in recent memory. Kenyan interior
ministry saying "Our forces are combing the mall floor by floor looking for
anyone left behind. We believe all hostages have been released."

This hour, the Kenyan government hasn`t yet made a full accounting.

Midday Saturday, Nairobi, Kenya, a mall that could easily be mistaken
for any major ml in the U.S. or anywhere in the world, fell under attack by
10 to 15 gunmen, reportedly from the Islamist al-Shabaab militia.

One eyewitness was an American who had recently moved to Nairobi from
North Carolina.

(BEGIN VIDEO CLIP)

BENDITA MALAKIA, SURVIVOR: You could hear while we were back there
them methodically kind of going from store to store, talking to people,
asking questions, shooting, screams, and then it would stop for a while.
Then they would go to another store.

(END VIDEO CLIP)

HAYES: Another eyewitness, a software engineer who was in the parking
lot with his two daughters said, "They were throwing grenades like maize to
chickens." He and his daughter survived.

But at last count, at least 62 people have died in the attack. Most
of the dead were Kenyans, along with foreigners from Britain, France,
Australia, Canada and India.

At one point, terrorists started a fire in the mall, which according
to security forces, was meant as a diversion. A reported 175 people were
wounded in a siege that entered its third day today. At least three
assailants have been killed by security forces with at least ten suspects
arrested. The attackers also took hostages as the standoff proceeded.

(BEGIN VIDEO CLIP)

JOSEPH OLE LENKU, KENYAN INTERIOR MINISTER: We have done search of
the building and we can confirm that the hostages, almost all of them have
been evacuated.

(END VIDEO CLIP)

HAYES: The Kenyan foreign minister Amina Mohamed has since told al
Jazeera the mall attack was the work of al Qaeda, not al Shabaab. More on
that in just a second.

Kenyan President Uhuru Kenyatta said one of his nephews was in the
mall and killed in the attack.

General Julius Karangi, the chief of the Kenya defense forces, said
the terrorists are clearly a multinational collection from all over the
world. The FBI is looking into reports that Americans were among the
attackers.

"The New York Times" photographer Tyler Hicks happened to be nearby
the mall when the siege began. He entered the mall along with police
officers and captured these stunning images.

(BEGIN VIDEO CLIP)

TYLER HICKS, THE NEW YORK TIMES: Once I got inside the mall, I could
see how tense everyone was, the army and police, how carefully they were
moving. They were dashing across open areas, taking extreme care with
their cover. It seemed kind of like anywhere you looked, there would be
another body. People were still hiding in shop, and as the police and the
army were moving through, they would either discover people or they would
sense that help had arrived and then they would flood out.

So, you get kind of moments of silence and then other moments of big
streams of people who they were trying to get out as quickly as possible.

It really seemed like everywhere we went, more people came out of the
woodwork. At one sense it seemed very abandoned. For example, the music
that plays in the shopping mall, the typical kind of music, was still
playing on the intercom.

And so, it was kind of this eerie silence with this music interrupted
occasionally by gunfire. Terrified people were crying, screaming, just
running for their lives, really. I never thought that I would encounter
this kind of tragedy in a public place like this, where completely innocent
civilians were just gunned down and murdered. It`s not like a conventional
war, where you expect combatants to get hurt or expect there to be
collateral damage in those kinds of situations. This is just a suicide
mission and murder.

(END VIDEO CLIP)

HAYES: Joining me now is Jeremy Scahill, my colleague at "The Nation"
magazine, where he`s national security correspondent. He is also author of
"Dirty Wars: The World is a Battlefield," producer and writer of the film
by the same name.

And, Jeremy, you were in Somalia. There`s footage of you being on a
rooftop with incoming fire from al Shabaab fighters, basically.

What do you make of these conflicting reports about whether al Shabaab
or al Qaeda did it, and who is al Shabaab and how are they different from
al Qaeda?

JEREMY SCAHILL, JOURNALIST: Right, well, first of all, al Shabaab was
a group of relative nobodies in 2006 during the Bush administration. They
were a sort of outlier in a group called the Islamic Courts Union, which
was largely made up of, almost exclusively made up of Somali actors, and
these actors meaning players on the scene in Somalia. And al Shabaab was
the sort of group among those that sort of had the most allegiance to al
Qaeda or affinity for Osama bin Laden`s message, but they had no political
sway whatsoever domestically within Somalia.

The U.S. partnered with the Ethiopian military in 2006-2007 and staged
an invasion of Somalia, and they dismantled this government of the Islamic
Courts Union, which was the only government that brought stability in
Somalia since the Blackhawk down episode in the fall of Siad Barre regime.

So, what ended up happening as a result of that is that the Shabaab
became the vanguard of what was viewed as a movement to fight off a
crusading force backed by the United States. So, al Shabaab started to get
street credibility within Somalia because they were the only ones fighting.
The rest of those networks had been disrupted, co-opted, killed or
imprisoned by the Americans and Ethiopians.

So, what happened at the end of the day is that al Qaeda was able to
get a foothold in Somalia and it had never been able to before. Bin Laden
desperately wanted to get into Somalia and Somalis rejected him. The U.S.
invasion with Ethiopia opened the door and al Shabaab has gotten
increasingly militant as the years have gone on.

HAYES: And they clearly seem to have an agenda if, in fact, this is
Somali al Shabaab fighters behind this. Why would they attack a Kenyan
mall?

SCAHILL: Well, there`s a long history of al Qaeda in East Africa and
then eventually al Shabaab staging attacks in Kenya and elsewhere in
Africa.

HAYES: Of course the embassy bombings.

SCAHILL: Yes, the embassy bombings in `98 in Tanzania and Kenya. But
then there was also a 2002 attempt to shoot down Israeli aircraft in
Mombasa. Then you had the bombing at the World Cup in 2010 in Uganda, an
American citizen was killed in that as well as a number of Ugandans.

And I think that, you know, if you look at the past two years, Kenya
has been deeply involved with Somali politics, funding warlords. I
traveled with a Kenyan-backed warlord who had brand new military equipment
given to him in the summer of 2011, and then Kenya actually staged an
invasion of parts of southern Somalia.

And I think al Shabaab has seized on this idea that Kenya is a puppet
or a proxy for the U.S., and that`s really the message that they`ve
propagandized.

HAYES: What does it say about the state of al Qaeda or global
jihadists in 2013 that this attack happened, that it`s coming from possibly
Somalia? It seems to me like it`s the situation which we smash one or
disrupt one network and they seem to pop up somewhere else.

SCAHILL: Right. Something interesting is that when I was last in
Somalia in the summer of 2011, the head of al Qaeda in East Africa was
killed in Mogadishu, Fazul Mohammed. And among the documents that were
seized, and I reported on this in my book, were letters from Fazul to Ayman
al Zawahiri, number two in al Qaeda. And what Fazul said was that Shabaab
is making a mistake trying to hold territory in Somalia and you need to go
back to managing savagery.

There is a famous al Qaeda paper called "The Management of Savagery,"
and the idea is make it impossible for anyone else to govern. Make people
feel fear and that the government can`t protect them.

HAYES: Chaos.

SCAHILL: And I think that`s part of what we`re seeing. But there`s
no one al Shabaab right now, which is why the Kenyans --

HAYES: Being splintered, and it`s unclear who is exactly controlling
the organization.

Journalist Jerry Scahill, thank you.

SCAHILL: Thanks a lot.

HAYES: We`ll be right back for #click3.

(COMMERCIAL BREAK)

HAYES: On Friday, I was on "Real Time with Bill Maher." I want to go
back on a reality check on something someone said about Obamacare, because
it was just totally wrong.

And this is the biggest day of the calendar year for Bill and Hillary
Clinton. But there`s a new whiff of scandal at the Clinton Foundation
while the author of a blockbuster new piece, coming up.

First, I want to share the three awesomest things on the Internet
today, beginning with a truly awesome vehicle, the Lamborghini Aventador.
A triumph of Italian design and innovation, this 700-horsepower mean
machine is capable of speeds over 200 miles per hour and comes at the low,
low price of just $400,000. Which is why if I ever bought one of these
things, I`d try really, really hard not to crash it.

Unfortunately, that`s what happened in Brooklyn, New York, over the
weekend, captured on security camera video. The driver of a white
Lamborghini Aventador is cut off by the driver of a dark blue Mazda and
good-bye $400,000 car.

The good news is that both drivers are reportedly OK. After the
crash, thanks in part to the design of the Lamborghini, which in the event
of a major impact is built to break in half, separating the driver
compartment from the engine.

The bad news is that half a Lamborghini is worth about the same as
half a Mazda.

The second awesomest thing on the Internet today, the booze-bot. Two
German engineering students walk into a bar and ask the bartender, why the
iPad face.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Can you give me a drink?

BOOZE-BOT: Coming up.

(INAUDIBLE)

BOOZE-BOT: Thank you.

ROBOT: You`re welcome.

UNIDENTIFIED MALE SPEAKER: Bye-bye.

ROBOT: Bye-bye. Have a nice day.

HAYES: OK. So, he`s not the fastest or most quick-witted bartender
we`ve ever seen and I have no idea how he`s going to mix drinks with only
that one big, slow arm. But, the true genius of this robot bartender,
designed by students at Blynefield University, is that it`s able to read
the body language of patrons and detect subtle gestures to determine who is
in need of a drink. The great technological advancement, which will ensure
that all humans are sufficiently hammered for the coming robopocalypse.
And, the third awesomest thing on the internet today, Batdad rises.

UNIDENTIFIED MALE SPEAKER: Kaya, face forward! You`re spilling
macaroni on the floor!

HAYES (voice-over): It`s the latest sensation on the video app known
as vine. Some guy wearing a batman mask tormenting his family in all sorts
of fun and interesting situations.

UNIDENTIFIED MALE SPEAKER: Hurry up! We`re going to be late for the
bus! Get out of there! It`s almost dinner time! You`ll spoil your
appetite! Where is she?

UNIDENTIFIED INFANT SPEAKER: She goes that way.

UNIDENTIFIED MALE SPEAKER: Oh.

UNIDENTIFIED INFANT SPEAKER: I piddled in potty!

UNIDENTIFIED MALE SPEAKER: Congratulations. Here`s a potty pop.

HAYES (voice-over): Who is Batdad, where does he come from? Who
cares? Batdad is the hero Click 3 deserves. You can find all of the links
for tonight`s Click 3 on our website allinwithchris.com. We will be right
back.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

HAYES: So, with health care exchanges set to open for enrollment on
October 1st, we are just eight days away from the effective launch of
Obamacare. And, while Ted Cruz and his threats are soaking up a lot of
attention, it`s easy to lose sight of the fact. We are very close to a
pretty incredible day in the history of American health care.

And, so, it is no surprise, the right wing has gone into overdrive in
trying to shape the narrative of that day before it happens. Not least by
once again sewing the seeds of misinformation about the impact of the law.
I was on HBO`s "realtime with Bill Maher" on Friday night when I got to
encounter a real-life example of this from the mouth of republican
speechwriter and journalist David Frum, who said the following --

(BEGIN VIDEO CLIP)

DAVID FRUM, OBAMACARE`S FIERCEST CRITIC: It is about to have a very
likely devastating impact on American employment. We can already see the
rise of part-time labor and the fall away of --

BILL MAHER, TELEVISION HOST/POLITICAL COMMENTATOR: Well, we don`t
know that.

FRUM: -- We do see that, because if your workers work less than 30
hours, you`re exempted, and we have seen, that`s where the growth in the
labor market is.

(END VIDEO CLIP)

HAYES: Now, I should be clear. This is not just a David Frum thing.
This is a huge, consistent, anti-Obama Care talking point.

(BEGIN VIDEO CLIP)

ELIZABETH MACDONALD, FOX BUSINESS NETWORK CORRESPONDENT: Companies
are increasingly blaming the health reform law for the rise in part-time
work.

STUART VARNEY (?), FOX BUSINESS NETWORK CORRESPONDENT: They`re moving
towards far more part-time work that is less than 30 hours a week.

KARL ROVE, AMERICAN REPUBLICAN POLITICAL CONSULTANT: President Obama
never sold the affordable care act to the American people by saying, "Look,
this is going to create more part-time jobs in the place of full-time
jobs." And, yet, that`s one of the big consequences of the bill.

(END VIDEO CLIP)

HAYES: And, I should be clear, this is also not just coming from the
right. This notion that Obama Care is killing full-time jobs has seeped
into the mainstream media as well.

(BEGIN VIDEO CLIP)

ERICA BYFIELD, WSB T.V. REPORTER: We have confirmed more than 100
Emory health care employees are going to lose their jobs in part because of
the affordable health care act.

(END VIDEO CLIP)

HAYES: It turns out, that wasn`t so much confirmed as, well, untrue.
As "The Atlantic" pointed out, top officials said, "The layoffs have
nothing to do with Obama Care." That`s a quote. And, Frum and his allies
don`t have it right, either. Here`s what I told them on "Real Time."

(BEGIN VIDEO CLIP)

HAYES: The trend in an increase towards part-time work precedes the
passage of Obama Care, which we should be clear on this, right? This is
actually, probably, a larger structural labor market trend.

(END VIDEO CLIP)

HAYES: I wanted a circle back to that point to emphasize the point
with actual data, which I didn`t have access to while sitting at Bill
Maher`s table. So, look at this chart. I wish I have this chart. I wish
I could have drawn it in that moment. There was indeed a huge spike in
part-time work, but it came with the great recession in 2008, in the
financial crisis.

Since then, involuntary part-time employment, that is, workers who
would like to work full-time jobs but are stuck in part-time jobs has
actually trended downward. This is part and parcel of the broader
republican case against President Obama, which is to basically blame
everything that has happened because of the worst financial crisis in seven
years on the president himself.

It isn`t to say there aren`t employers who say Obama care is forcing
them to cut hours, but as economist Mark Zandi has pointed out, the claim
that Obama Care is causing some large-scale shift to part-time work is
simply not borne out by the data.

If Obama Care is going to be the disaster, conservatives say, "Well,
we will all know that very shortly." There is no reason to lie about it
ahead of time. If anything, republicans should be excited for the
experiment to start, so they can be proven right. The fact that they are
so intent on spinning ahead of time shows that they are actually nervous
that thing`s going to work.

(COMMERCIAL BREAK)

HAYES: You may not know it, but today is Clinton Day. It`s the first
Monday of the last week of September, which means it`s the kickoff to the
Clinton global initiative. A gathering of global bold-faced names in New
York, so headline-grabbing, it overshadows the meeting of the world leaders
over at the U.N.

You can look at it as a week-long Apple product rollout for the
Darvocet. And this year, it`s as hotly anticipated as any in recent memory
and that`s because Hillary Clinton is now working for what has been called
the family business. The nonprofit that once used only her husband`s name
but now has been renamed the Bill, Hillary, and Chelsea Clinton foundation.

To compliment her new role, Mrs. Clinton also gave her first interview
since leaving her post as secretary of state to "New York" magazine. Tried
to convince the public that she and Bill are just kicking back and taking
it easy. "We laugh at our dogs. We watch stupid movies. We take long
walks."

And, yes, she is also considering running for president, adding, "I
will just continue to weigh what the factors are that would influence me
making a decision one way or the other." Complicating matters, a new
blockbuster expose from "The New Republic" on some pretty suspect dealings
within the Clinton Foundation.

At the center of it, a guy named Doug Band, Bill Clinton`s former
bodyman, longtime confidante. Band oversaw the Clinton global initiative
and eventually started his own corporate consulting firm dependent on his
relationship with Clinton. As reporter, Alec MacGillis, who will join me
in a moment, writes "For corporations attaching Clinton`s brand, the social
investments offered a major PR boost. As further incentive, they could
hope for a kind word from Clinton next time they landed in a sticky spot."

Coca-Cola or Dow or whoever would come to the president and explains a
former White House colleagues of Band and say, "We need your help on this."
Negotiating these relationships and the trade-offs they required can
involve some gray areas, but for that, Clinton had band.

As a former Clinton White House colleague put it, Doug Band was a
gatekeeper who charged tolls. But, now Band`s rule within Clinton hand is
winding down, he and Bill Clinton only see each other a few months. And,
band`s position within the foundation is being taken over by none other
than Chelsea Clinton. But, the former first daughter and her mother are
reportedly wary of Band, that Band`s former bus publicly defended him
earlier.

(BEGIN VIDEO CLIP)

BILL CLINTON, FORMER U.S. PRESIDENT: There`s nothing wrong with him
starting a business for people he met working for me. That`s the only way
he could have met people he could do business with. I`m very grateful for
the role that he played when we started out, and I wish him well. I think
it was necessary, and I believe he came to see it was necessary to make a
clean break because his business grew more quickly than I think he thought
it was.

(END VIDEO CLIP)

HAYES: Alec MacGillis, Senior Editor at "The New Republican" who
wrote that piece on the Clintons for "The New Republic." How did the piece
come about?

ALEC MACGILLIS, SENIOR EDITOR AT THE NEW REPUBLICAN: It came about a
long time ago, back in -- gosh, I think before the election, before the
2012 election. One of my editors approached me and said, "We think it`s
time to do a good profile of Doug Band. He has been in the background of a
lot of stories for the last decade or so.

His profile has been growing, but he has never been really focused on.
So, I started making calls. And, basically, the day after the election,
it`s been a very long slog. Clinton land is locked down more than ever
before. So, it` has been on and off for ten months now.

HAYES: So, who -- explain who this guy is and the role he plays.

MACGILLIS: He is a fascinating figure. He is just a very complicated
and fascinating figure. He was the guy who carried -- he was the body man
for Bill Clinton, the character we know from "West Wing" as Charlie Young,
who he helped tutor to play that role.

So, he comes in as the last body man for Bill Clinton in 1999-2000,
carries the bags, carries the cigar case, carries the cokes -- diet cokes,
and then after President Clinton leaves the White House, he stays with
Clinton. He had an offer at Goldman Sachs. He could have just taken a
regular -- you know? Successful business route.

He stays with the Clintons -- with President Clinton, stays in that
role of assistant, travels all around the world with him, just hundreds of
cities, dozens of countries, on the private jets for all these years and
becomes basically the main guy.

HAYES: Yes. If you want to get Bill Clinton to come to your event or
get to him, you go through Doug Band, basically.

MACGILLIS: Exactly.

HAYES: And, so, what`s the problem here? What is the scandal is in
the headline of your piece. Like, to justify the use of that word to me.

MACGILLIS: Well, the use of scandal was a bit of a headline writer`s
irony -- but, no -- but there is a problem, and the problem is that there
has been increasing overlap, really, between both for Doug Band and for
sort of Bill Clinton and Clinton Land as a whole, overlap between the great
public good that they have been doing, including Doug Band. Doug Band
helped come up with the Clinton global initiative, which has distributed
billions of dollars around the world --

HAYES: He has done amazing stuff.

MACGILLIS: -- has done amazing stuff, but there`s been increasing
overlap between that public good and private benefit.

HAYES: There are two stories I want to get out of you from the piece.
One is about the post office, which it was a jaw-dropping story to me.
What happened with the post office?

MACGILLIS: So, in 2009, Doug Band`s family owns the post office in
Sarasota. His dad is a very successful real estate --

HAYES: They own the building the post office leases from.

MACGILLIS: Exactly, the main post office in Sarasota, where Doug is
from. The postal service desperate to get its finances in better shape,
wants to buy this building back from the family. They have sort of a
lease-to-buy arrangement. The family objects to the terms that the postal
service --

HAYES: The price.

MACGILLIS: The price. The postal service offers $800,000 for this
building. The family wants a lot more. So, Doug places a call in the
summer of 2009 to a longtime Clinton fund-raiser who sits -- happens to sit
on the postal service board of governors. This is the board that`s
supposed to be looking out for the interests of the postal service and the
taxpayer and all that.

And places the call and this guy -- this man, a Philadelphia lawyer,
by the name of Allen Kessler, jumps into action, just makes calls, e-mails
all around the postal service saying please fix this. Doug Band could go
to Capitol Hill and cause problems for us. Doug Band is so-and-so, and --

HAYES: We need to give -- we need to buy. We have to pay more money
for this post office in Sarasota --

MACGILLIS: Right.

HAYES: -- because the right-hand man of the ex-president of the
United States called me on the phone and said so.

MACGILLIS: Exactly. And, there`s a wonderful exchange of e-mails
that I got in a freedom of information request through chatter about
Chelsea`s wedding and a lot are just -- sort of Clinton land --

HAYES: Isn`t this just the way that all of the 1 percent roll --
Like, couldn`t you just do the same thing on the bushies, on any prominent
-- like, this moving back and forth between public and private, that`s just
how everyone works, right?

MACGILLIS: It is how Washington works these days and that`s the real
problem. What I think sets this apart is the scale of it. The amounts of
money involved that are sort of swirling around Doug and Clinton land are
just enormous.

HAYES: I want to talk about that. We should also say we reached out
to the Clinton global initiative and Doug Band for comment, neither got
back to us. We will be back with someone who wrote a piece on the
Clintons, only to have it spiked from the magazine.

(COMMERCIAL BREAK)

HAYES: Earlier in the show, we asked you what you thought we had next
learn about Ted Cruz. We got a ton of answers, post into our Facebook page
and half replied on Twitter including Carter Hall who says, "We`ll find out
Ted Cruz is heavily into does not johns and dragons." And, Joe Byrum nods
the center of birthplace when pronounces mom as "Mum, Oh Canada."

And, the Twitter fan Irene Harlavados telling us, "We`ll find out ted
is a huge Indigo`s girls fan." I would actually like him more and more if
that were true. We will be right back.

(COMMERCIAL BREAK)

HAYES: Still with me is Alec MacGillis and joining me is Rebecca
Tracer, journalist and author of the fantastic book "Big Girls Don`t Cry:
The Election That Changed Everything For American Women." And, Joshua
Green, National Correspondent for "Bloomberg Businessweek." In 2007, he
wrote a piece about Hillary Clinton for "GQ" that ended up getting spiked
from the magazine as it was printing a cover story about Bill Clinton.

Alec, I want to just come back to you quickly, because it`s
interesting to me, and this is what I really want to discuss here. People
on the internet are saying, people on Twitter are like, "This is whitewater
2.0. This is scandal mongering" -- Like what`s the actual scandal here?
Like, I guess the question is, there seem to be two plausible stories about
the Clintons.

One is that they involve themselves in shady dealings. They have
these hangers-on who sort of trade on their name for all kinds of
unseemingly transactional stuff, and Doug Band is an example. That is one
possible story. The other story is they are basically like any prominent,
wealthy, powerful family in America, or figures in America, and our level
of scrutiny 100 is a hundred times higher because they are the Clintons.
So, persuade me we`re talking about the former and not the latter.

MACGILLIS: Yes, I think it`s the scale. I mean the amount of money
we are talking about here is just on a whole different order of magnitude,
because I mean, a lot of people sort of, you know, do the transactional
thing. But, few do it with some of the richest people in the world. We
are talking about private jets flying all around to meetings with a lot of
Petrocrats and this is just sort of top-level, davos-level kind of
consorting.

HAYES: And, you guys are basically saying there`s essentially this
kind of tacit favor trading, even if it knocks the quid pro quo, which is I
give to the global initiative, right? -- as a philanthropic gesture, Bill
Clinton endorses me to some easy on beck ruler and I then get a mental
resources deal with the Ozbek government because Bill Clinton essentially
played --

MACGILLIS: Which happened.

HAYES: -- that exactly what happened.

MACGILLIS: The other part of it is just the amount of money coming
into the Clinton circle is just on a magnitude different -- $100 million in
speaking fees. Doug Band is already up to a 200-person company and is
living in a palatial apartment overlooking Central Park South. This is
success on a different level than I think we are even used to.

HAYES: What do you think when you hear this?

REBECCA TRAISTER, JOURNALIST: Well, part of what I think is that if
this conversation had been taking place ten months ago when you started
writing the piece. I would have been pushing back at both of you very
vociferously against the use over the use of the Clintons as a thing,
because one of the things --

HAYES: That`s a really good point.

TRAISTER: -- that we have to point out is that the post White House
years for Bill Clinton, which is when he forms the CGI, when this
relationship with Doug Band becomes so complicated, these are the same post
White House years during which Hillary Clinton is embarking on her entirely
independent political career. She is a senator. She is running a historic
race for president and she is running the department --

HAYES: And, they are -- as far as we know they are basically talking
on the phone when they can do that.

TRAISTER: Exactly. And, as both Alec`s great piece and the piece in
"New York" magazine make pretty clear, there has been a ravine between
Clinton land, which is Bill`s world and Hillary land, which is the old.
And, there might be some bridges like Huma Abedin.

But, basically, these are two separate worlds, and if anything -- you
know, Hillary is suspicious of this kind of fratty cabal that today`s
Alec`s writing about right now. But, I am interested and troubled by the
choice that Hillary has made strategically to join the family foundation --

HAYES: Right. But, now --

TRAISTER: -- because that brings her in, and now it`s Clinton --

HAYES: So, now, they`re all there, and in some ways, the narrative is
things got out of hand, Bill sort of let Doug Band run wild. Now, Hillary
Clinton, who did a great job managing the state department, is back in
town. Chelsea Clinton`s going to whip things in shape. Josh, is that your
sense of the way the story is being presented or understood?

JOSHUA GREEN, AMERICAN JOURNALIST: No, not at all. What was so
striking to me about Alec`s piece was it showed that this idea of an
advisor run amuck is really endemic to both Clintons. We look back at the
`08 campaign now and remembered it as this glorious Obama triumph.

But, what really happened was that Hillary`s senior advisers were so
busy trying to amass their own power and personal fortunes that they
stopped paying attention to what was best for the campaign, and ultimately
got out-maneuvered.

And, it seems to me reading Alec`s piece, that both Clinton as really
have a blind spot for this sort of thing, and if they fall prey to an
extent or at least don`t think to disassociate themselves or recognize
when this becomes a problem.

TRAISTER: I think that`s an absolutely fair observation about `08,
though I would also say that as many people have looked back and said what
was Hillary`s strategic mistake then? It was that she was relying on
Bill`s team --

HAYES: Right.

TRAISTER: -- on the sort of this same group of guys who came in, and
I would say and have said drastically mismanaged her campaign. And, that
one of the lessons after that and after the state department should have
perhaps been steering very clear.

HAYES: Well, and one of the things I think that`s clear here is, this
article portends a hundred articles like it, because the Clinton global
initiative is something that I don`t think has gotten a ton of very
skeptical scrutinizing press, partly because they are ostensibly doing very
good work and our demonstrably doing excellent work, right?

But, now in the context of the possibility of the Hillary Clinton run,
all of a sudden, what the Clinton Global Initiative does is the way that it
sort of bestrides these two worlds -- these different worlds of NGOs, world
leaders and billionaires and the kind of transactional circulation that
happens amongst them, which I have written about as a reporter myself. I
have witnessed up close. There is going to be a lot more stories like
this.

MACGILLIS: There are, and I think the other reason this is a problem
for Hillary, if she were to run, is that we seem to be in kind of a
populist moment right now. I mean it`s pretty remarkable what you`ve seen
in the last few weeks, Larry Summers going down, Bill De Blasio winning in
New York. There`s just a -- there is a moment where it seems as if the
Democratic Party`s going through some kind of churn about just where it
wants to be in terms of banking --

HAYES: Right.

MACGILLIS: And, money and all that.

HAYES: It`s the 1 percentness.

MACGILLIS: The 1 percentness, exactly. And, so, to the extent that
you have the Clintons, all of them, but especially Bill, out there with --
I mean, more 1 percent than you could even imagine. That may not help
matters and it may open up to a left challenge.

HAYES: Although, Josh, it is also the case that these are two people
who are as defined in the public mind as any politicians of our time,
right? I mean, the question is how much malleability is there around
perceptions of these two individuals?

GREEN: You know, I actually think there is a decent bit. I think
that`s right in the sense that, you know, if someone tries to drudge up
whitewater, you know? Our image of both Clintons on old scandals like that
is baked in. But, all the stuff in Alec`s piece is new information.

And, a lot has transpired in the eight years or however long it`s been
since Clinton left the White House. And, with all the attention on Clinton
and his business cronies and all the kind of chaos that just naturally
seems to kind of show up in Hillary land, I think it really could be a
problem for her if she decides to run.

HAYES: I couldn`t think of something more ironic than for this to
blow up and sabotage a Hillary Clinton campaign. That would give you
another book.

TRAISTER: Well, this is why I really raised my eyebrows when I heard
she was going to the foundation. There were 46 other things she could have
done with these intervening two years, if she wants to run for president.

HAYES: Alec MacGillis From the New Republic, journalist Rebecca
Traister, and Josh Green from "Bloomberg Businessweek," thank you all.
That is "All In" for this evening. "The Rachel Maddow Show" starts right
now. Good evening, Rachel.

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

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