updated 2/3/2014 11:13:59 AM ET 2014-02-03T16:13:59

UP with STEVE KORNACKI
February 1, 2014

Guests: Kevin Walsh, Rep. Frank Pallone, Rep. Bill Pascrell, Bob Ingle,
Suzy Khimm, Brian Murphy, Mark Sokolich, Brian Wice, Paul Butler

STEVE KORNACKI, MSNBC ANCHOR: Is it sandy money or a slush fund?

(MUSIC PLAYING)

KORNACKI: You know the headlines by now. There were some major
developments late yesterday afternoon in the Chris Christie/George
Washington Bridge scandal. It was the news first that the lawyer for Bill
Stepien, that`s Christie`s former campaign manager and top political
lieutenant, he said his client would be invoking the Fifth Amendment and
fighting not just a subpoena to appear before state legislative committee
investigating the scandal but also its request that he turned over
documents relevant to the inquiry.

Then, just after that, came a letter from the lawyer for David Wildstein,
the Christie Port Authority appointee who oversaw the lane closures back in
September and who subpoenaed documents blew this whole story up just a few
weeks ago. It was a letter suggesting that Christie knew of the lane
closures as they happened and claiming that Wildstein can prove that
certain unspecified things that Christie said about him in his January 9th
press conference aren`t true.

So, two very big and important developments in the Christie story, they
came back-to-back on Friday afternoon. This morning, we are going to be
all over these developments and we`re also going to have some new documents
involving the allegations of Dawn Zimmer, the mayor of Hoboken. We`ll be
getting to all of that in just a bit.

But it`s not going to be our lead this morning, because we`re going to
start with a story we have spent the last few days reporting out. That is
because we have some new information that we can report to you this morning
about Chris Christie and Sandy recovery funds. It involves a law that was
created last year to prevent the misuse and abuse of Sandy money. It is a
law that as far as we can tell the Christie administration has at best been
slow and complying with and at worst has intentionally dragged its feet on
implementing.

This, in turn, has contributed to a series of recent stories that have
called into question how Christie`s team has managed and spent the giant
pot of Sandy money they received from the federal government last year.
We`re going to explain that fully and we`ll tell you about the major role
that a company that employs the governor`s brother plays in all of this in
just a minute.

But to understand what this is all about, we are going to start with a
story that made news this week. It`s a story you probably already know
about. It was reported on Tuesday night by "The Newark Star Ledger" that
Christie, himself, had aggressively pushed to stir $6 million in Sandy
money for the development of a senior citizen housing complex in the town
of Bellville, New jersey.

Bellville which is a gritty town of about 36,000 just outside Newark was
not devastated by Sandy in the same way that Hoboken, which was 80 percent
under water at the height of the storm was, in that project that Christie
directed the Sandy money towards. It had been in the works for a long
time, well before the storm had hit. As "The Star Ledger" reported, Sandy
was barely mentioned at the 20-minute ground-breaking ceremony for the
project last May.

It is being built primarily as a way to allow seniors in Bellville to
retire in their home town, not as a way of providing shelter to Sandy
victims. Now, to put this in some context, Bellville is part of Essex
County, that is one of the largest and most Democratic friendly counties in
New Jersey. But Christie has cultivated key political alliances with top
Democrats in the county.

The county`s executive, Joe Divincenzo, was one of the most prominent
Democratic officials in the state to endorse him last year. And the
political machine that produced Divincenzo which is based in the northward
of Newark has long been suspected of quietly boosting Christie in his first
campaign for governor back in 2009. In fact, the first public appearance
that Chris Christie made after winning in 2009, the morning after that
election, was at the Northward Center in Newark, where he appeared with the
Northward`s Democratic boss, Steve Adubato, Sr. (ph).

So, anyway, the senior citizen housing project in Bellville in Essex County
had been on the agenda for a long time. It was important to Joe
Divincenzo. It was important to the mayor of Bellville. It was important
to many democrats from the area who had provided key public and private
support to Chris Christie, Democrats he, no doubt, wanted to keep on board
for the 2013 campaign.

Sure enough, just after Christie took part in the ground-breaking ceremony
for the Bellville project last May, the mayor of Bellville did endorse him.
So, that was the news this week. $6 million in Sandy money steered toward
this project.

That, on top of the allegations that Hoboken mayor, Dawn Zimmer, made on
this show two weeks ago, allegations that members of the Christie
administration linked her city`s level of Sandy aide to her approval of a
development project with ties to a key Christi Christie ally, that was
enough to prompt "The Star Ledger," New Jersey`s largest newspaper, to run
a scathing editorial this week reminding Christie that, quote, "The Sandy
aide New Jersey received was intended to help the victims of the storm not
as a political sludge fund."

But ask yourself this, why are we only finding out now in late January of
2014 that this massive project in Belleville, one that you had to do some
straining to connect to the Sandy recovery effort? Why are we only finding
out now the $6 million of Sandy money is being spent on it? I mean, we
have known about the project, itself for a long time. The governor,
himself, and other local leaders, as you saw, they made a big to-do about
breaking ground on it last May.

But it was only this week that we discovered that it`s Sandy money that`s
paying for this project. How have we not known that this whole time? This
is where our reporting comes in. This, what I`m holding up right here, is
something called the Integrity Monitor Act of 2013. It was passed by the
New Jersey legislature and signed by Chris Christie in March of last year.
The idea behind it was simple.

Congress had just approved an enormous aid package for Sandy recovery in
billions of dollars of federal money were about to start flowing into the
state into all sorts of projects. The fight to get Congress to approve
that money was hard. It had been very hard. Maybe you remember the show
that Christie himself put on when Tea Party Republicans initially blocked
it.

(BEGIN VIDEO CLIP)

GOV. CHRIS CHRISTIE, (R) NEW JERSEY: There`s only one group to blame for
the continued suffering of these innocent victims, the house majority and
their speaker, John Boehner.

(END VIDEO CLIP)

KORNACKI: When Congress finally gave in, he gave New Jersey a priceless
opportunity to rebuild itself the right way. The money had been approved
but with, just like any other massive federal spending program, that
directs money from Washington through state capitals and all the way down
to the county and municipal level. Just like any of those projects, there
was the very real potential for waste, for fraud, for abuse, even for
outright theft of those funds.

And in fact, there was already controversy, just after the storm hit,
Christie had awarded a state cleanup contract to a Florida-based company
called AshBritt. It was his (ph) administration that encouraged local
municipalities to use the firm services, too. But other firms argued they
could do the work at lower cost. AshBrit was also represented by lobbying
firm of Haley Barbour, that`s the former Mississippi governor who is
friendly with Christie.

Federal investigators ended up sniffing around and asking questions about
that deal. When asked about this yesterday, the governor`s office told us
that AshBritt was selected without considering other lower price bids
because the state of New Jersey, quote, "quickly needed a debris removal
company with extensive experience in post-disaster recovery."

Administration also said that the towns that used AshBritt entirely by
their choice said, quote, "The company performed to expectations or exceed
them." Still, at the same time that all this was going on, the AshBritt
controversy was fresh in the air when Congress sent that giant pot of money
to New Jersey. It was why the state legislature put together what became
known as the integrity monitor act, what I just held up.

And that law requires that an integrity monitor, which means a qualified
firm that can provide auditing and other oversight services, that an
integrity monitor be assigned to every recovery and rebuilding project
worth at least $5 million. It set up what`s known as a public procurement
process, to let private companies bid for the right to serve as integrity
monitors for the Sandy rebuilding projects.

The monitors would make sure that the projects were proceeding according to
plan, that the money was being spent properly, and they would be required
to report any suspicion of illegal activity or any serious waste, fraud,
and abuse immediately to the state attorney general and to the state
controller. All of this was modeled after a plan that had been used by New
York City for the massively expensive post 9/11 cleanup.

So, the state assembly unanimously gave final approval to this integrity
monitoring law on March 21st of last year when state Senate passing it a
few weeks before in February. Then, Christie himself signing it into law
on March 27th. It went into effect right away. You can see at the bottom
of the law, it took effect immediately on the day it was signed. That is
how eager the state legislature was to get this program up and running.

March 27th, 2013, and that should have been that. From that point forward,
every major Sandy rebuilding contract in New Jersey was supposed to be
independently monitored. The whole program would be run by the state
treasury department by Chris Christie`s treasury department. The treasury
department went ahead in the spring of 2013 and put out a request for
quotations.

It took bids from perspective monitoring programs, then they awarded some
contracts, a pool of monitors was established. You can find it here. They
put in bids, they were accepted, they were added to the monitoring pool.
You can view them on the state website right there. They were in place to
monitor those big bucks contracts. But here`s the problem. Here`s why
this all has seemingly broken down.

How it ended up that a project like that multimillion-dollar senior center
in Bellville managed to escape scrutiny for all this time? The problem is
that the law is taking a very long time to implement. Actually, the
breakdown began even before the law was passed, because there was a second
proposed law, a companion law that also cleared the legislature at the same
time.

It called for the creation of a website to catalog every Sandy recovery
dollar spent at the county, municipal level. Every state contract awarded,
what the contract was for, how much it was worth, whether it was supposed
to be open and subject to bidding. It was also supposed to provide
similarly detailed information on every state grant awarded.

All of this information was supposed to be in one comprehensive,
accessible, and transparent website with a rule that every new contractor
grant awarded would be posted within ten business days. That bill passed
the assembly. The margin was 77 to nothing. In the senate, it was 40 to
nothing. But then, even after signing the integrity monitoring law, Chris
Christie vetoed it.

In his veto message to the legislature, he said it would produce, quote,
"unnecessary redundancies and waste government resources" that he had
already directed his administration to create a website to track Sandy
recovery money.

So, here`s what that decision by Christie means from a practical
standpoint. Let`s take that Bellville project we talked about just a
minute ago. Let`s say you want to go online and find out about the use of
Sandy funds to pay for it. We did a little exercise and we started with
the state controller site. And remember, when Christie vetoed that website
transparency bill, he specifically pointed to the website his own
comptroller would be maintaining.

So, that`s where we started. You can see, it bills itself as the Sandy
transparency site. And yes, you can find contracts there but not that many
of them and not the Bellville one. So then, we tried the state`s housing
and mortgage finance agency site. There wasn`t anything there. We tried
the treasury department to see if there were more contracts listed there,
but there weren`t. What about the Department of Community Affairs? They
have a Sandy page in an entire section on Sandy funds. No luck there
either.

So, it was back to the comptroller site where you can look by county and
town. That only takes you to some smaller figures and they`re FEMA
numbers. That`s a totally different pool of money. So, we ended up going
to an article in the "Star Ledger" and we followed a link to an
announcement where you can find the name of the project in Bellville. And
then, we Google that name and we found the minutes of the meeting where the
project`s mortgage was approved.

That gave us the number for the project. And we Googled that to find out
where it all started back in 2011 when the project was only approved for
$500,000 of aid from the state instead of the $6.2 million it was approved
for in 2013 post Sandy. And even then, the only way you know that this is
Sandy money is to go back to that press release from Essex County
executive, Joe Divincenzo. This sentence was the only statement we can
find that links this project to Sandy aide.

Quote, "Since the project is located in one of the nine counties most
impacted by Sandy, the project may assist senior citizens affected by the
storm." That was the justification for this being a Sandy project. That
is not -- that is what not having the kind of website that Christie vetoed
means when it comes to tracking Sandy money.

But now, moving back to that law, the law that actually did pass, the law
that is on the books, the integrity monitoring law, the one that went into
effect nearly a year ago at the end of last March. Now, remember,
integrity monitors were selected. Many have been in place. Many have been
in place and seemingly ready to go since last summer.

The law requires that on the first business day of each quarter, every one
of those integrity monitors is supposed to provide a report to the state
treasury that includes, quote, "detailed findings concerning the integrity
oversight monitor`s provision of services and recommendations for
corrective or remedial action relative to findings of malfeasance and
inefficiency."

Those reports, those quarterly reported are then supposed to be taken by
Christie`s treasury department and given to the state legislature so that
lawmakers and citizens for that matter can keep tabs on what the big bucks
recovery projects are and whether they`re being completed the way they
should be. So, we called the legislature this week and we asked for those
reports. We asked for the reports for the third and fourth quarter of
2013.

We found out that the legislature doesn`t have those reports. Several
legislators told us this and when we checked with the state Senate majority
office, they confirmed to us that they have never received quarterly
reports, the quarterly reports they are supposedly supposed to receive
under this law. The law also provides a waiver provision.

The treasury department can exempt projects from the monitor requirement if
it wants, but it has to alert the legislature and offer written
justification for doing so within 10 days. Again, senate majority office
confirmed to us that they have never received a single waiver form like
that. Now, think about that $6 million in Sandy money that went to
Bellville last May. $6 million. That is more than the $5 million that
should have triggered the monitor law.

It was supposed to mean that an independent entity would theoretically be
monitoring, tracking, and reporting on that project. Now, think about
another big contract that`s been in the news recently, the biggest single
Sandy recovery contract yet given out. You may remember this. It was in
the news last week. $68 million for a firm called Hammerman and Gainer,
HGI as known as.

And that HGI contract, we found out last week, was quietly canceled by the
Christie administration in December. But the administration hasn`t fully
explained why. When we asked, they referred us to a statement from the
Department of Community Affairs that said that the termination of the HGI
contract came about, quote, "by mutual agreement" because the state is
transitioning to the next phase of housing recovery programs.

We also contacted HGI yesterday and we have not heard back yet as of now.
So, we know that the Bellville project was worth more than $5 million. We
know that the HGI contract was worth a lot more than $5 million. But
here`s something we have absolutely no idea about, whether either of those
projects ever got a monitor. We have no idea, because there are no records
with the state legislature and there are no waivers.

Governor`s office left it to treasury to explain how the integrity
oversight act process works in their view. We invited someone from
treasury on air to talk about the law as well as from the governor`s
office. They did not respond to our offer. Still, the administration
wanted to be clear to us that, quote, "integrity monitors are only one
facet of contracting oversight from the administration and it would be
wrong to characterize this program as the only oversight action taking
place."

Some of those other facets are a work in process. Some of them are other
state agencies and some of them federal oversight programs which are not
under the control of the Christie administration. Earlier this week, HUD
secretary, Shawn Donovan, did appear on this network to express his
confidence in the handling of Sandy relief aid.

(BEGIN VIDEO CLIP)

VOICE OF SEC. SHAWN DONOVAN, U.S. DEPT. OF HOUSING AND URBAN DEVELOPMENT:
So, what I will tell you is, could it be going faster? Yes. Are we doing
everything we can to cut red tape? Absolutely. But I am confident that we
are monitoring this money closely.

(END VIDEO CLIP)

KORNACKI: And the Christie administration did point us to the use of an
independent monitoring firm since last June by the Department of Community
Affairs. This is not something that`s being done under the Integrity
Monitoring Act.

We had several conversations on Thursday and Friday with the treasury
department in an effort to find out exactly what is happening with the law
that was signed more than ten months ago in March of 2013, a law that went
into effect immediately with some massive contracts given out and some
massive projects already began since then.

The treasury`s office told us they have spent those ten months since March
training people to implement the law, quote, "Steadily moving through this
process has allowed integrity monitors to begin being put in place earlier
this month. That`s January. No reports have been filed because none have
yet been due."

So, the treasury department is telling us they have complied with the law
because they`ve been spending these past ten months getting ready to
monitor the distribution of Sandy aid that has already been handed out in
multimillion-dollar parcels to projects that have long since begun. As
part of our conversations with the treasury department, we asked if the
Bellville project has been given a monitor.

We asked the same about the HGI contract, was it given a monitor? We asked
how many of the contracts, how many contacts are out there worth more than
$5 million? How many of them currently have monitors? How many have
waivers? The statement we received back from treasury did not answer these
specific questions. We contacted them again with a follow-up question
asking whether we were interpreting their statement correctly that prior to
January, 2014, there had been no integrity monitors in place.

We did not hear back from them. We will continue to follow up on this.
And then, there`s this. One of the firms that answered the state treasury
department`s call for proposals way back when the law was first enacted was
Ernst & Young. It`s a highly respected accounting firm. And you can see
right here their April 8th, 2013 proposal to provide, quote, "program and
process management auditing, financial auditing, and grant management and
integrity monitoring and anti-fraud services for disaster recovery related
to hurricane Sandy."

Now, there were a lot of proposals like this from a lot of different
companies, and Ernst & Young is one of many that was accepted by the state.
You can see here, on May 14th, 2013, there`s Ernst & Young being approved
as an integrity monitor. Which unclear is how this happened? This is a
power point presentation that according to the title was prepared for
something called the New Jersey Superstorm Sandy fraud prevention
conference late last year. And here`s how it describes Ernst & Young.

Quote, "Treasury`s contracted partner in the centralized point of contact
in the implementation of PL 2013, C37." That`s the legalese for the name
of the law, the Integrity Monitoring Act. If you look closely at that
slide, it appears the treasury is delegating to Ernst & Young a significant
role in determining which contracts should and shouldn`t receive monitors
and which potential monitors should be assigned to various projects.

The treasurer`s office has confirmed to us that this is Ernst & Young`s
role, but there`s nothing in the law itself that calls on treasury to enter
into such partnership. In the RFQ, that`s the request for quotations that
Ernst & Young responded to, made no mention of this unique role. It
appears that Christie`s treasury department has used its discretionary
authority to carve out this unique and important role for Ernst.

And it`s worth noting, however, that as the Integrity Monitoring Act was
working its way through the legislature last year, it was reported that
Ernst & Young had hired a new director of its northeast practices market.
This was March 13th, 2013. And the man they chose for that job is named
Todd Christie. That would be Chris Christie`s brother, a former Wall
Street trader. And a spokesperson for Ernst & Young told us that his
employment actually began in December of 2012.

The two sides were likely in negotiations for months before that. We asked
the governor`s office about Ernst & Young`s important role with the
treasury department, and Todd Christie`s job with the firm. They replied
that Ernst & Young was, quote, "selected through an objective, open, and
competitively bid process for their work with treasury. They noted that
the company has over 175,000 employees in an extensive experience with
recovery work.

A spokesperson for Ernst & Young told us, quote, "Todd Christie was not
involved in this project in any respect and is not involved in any work
related to the government of New Jersey." Ernst & Young was awarded the
project through a public bidding process and is highly qualified having
performed similar work before.

All of this, though, of course, comes back to the basic question of the
Christie administration and Sandy money. We can all debate the merits of
that senior center in Bellville, but the fact that almost no one knew it
was a Sandy project until this week speaks to the fact that a law that has
been on the books for almost a year that was designed to avoid exactly this
kind of secrecy is apparently only now being fully implemented. And it
then raises the question, are there other Bellvilles out there just waiting
to be discovered.

(COMMERCIAL BREAK)

KORNACKI: So, we`re talking about a law that was added to the books in New
Jersey almost a year ago to monitor all of these big Sandy contracts that
apparently is only now being fully implemented. Joining us to talk about
it, we have New Jersey congressman, Frank Pallone and we have Kevin Walsh.
He`s the associate director at the Fair Share Housing Center.

So, there was sort of complicated introduction there. But Kevin, it seems
to me even after we talked to the administration yesterday, the distinct
impression I get is that this law was passed last March with the provision
that goes into effect immediately. And it looks like from a monitoring
standpoint, nothing has happened until the last few weeks. That seems like
an unnecessarily long delay to me.

KEVIN WALSH, FAIR SHARE HOUSING CENTER: Yes. This law was put in place in
March. People were then hired in May. The contracts were approved, and
then after that, everybody thought that $1.8 billion in federal money was
being spent by the state with people looking over the shoulders of the
people spending the money making the decisions.

It comes as a complete surprise to the people in New Jersey to now find
that they haven`t really even launched the program, just barely have done
so according to the statement issued by the state. People in New Jersey
who are still out of their houses expected more than this.

And we`ve reached a point where there`ve been so many problems, so many
inequities, such a lack of transparency, to find that the cornerstone
program for insuring that there was no waste, fraud, and abuse, to find
that that thing wasn`t even implemented when you`re trying to recover comes
as a real punch in the gut.

KORNACKI: And congressman, this is federal money going back through New
Jersey. And did you have any idea that this monitoring thing was not even
being implemented, apparently?

REP. FRANK PALLONE, (D) NEW JERSEY: No. I`m so glad you brought it out
this morning. Look, this whole period from when the HGI, which was the
company that was administering the Sandy money, right, and hopefully,
sending it to homeowners and businesses, and all the mismanagement and
everything that, you know, I keep hearing about every day in my office,
because people don`t know where their money or their checks is.

I mean, if this monitor had been in place based on what you were saying, we
would have had monthly oversight and reports telling us exactly what was
going and whether, you know, a contractor like HGI was actually doing their
job. And the fact it didn`t exist and it wasn`t in place, even though that
was the law is just incredible, because you know, we just had so many cases
of mismanagement to this day where people don`t know what this program is
all about.

I`m talking about the balk grant, the community development balk grant.
And now, you know, Bill Prescott (ph) and I are asking that HUD investigate
HGI why their contract was terminated and who`s running this program now?
Because DCA doesn`t say who`s running the program. But if this monitor had
been operating the way it was supposed to, then it`s very likely that none
of these problems would have existed.

So, I mean, it`s just incredible to think that they just ignored the law,
didn`t do anything, and now, you know, they`re saying, oh, we`ve got to
start monitoring.

KORNACKI: Yes. So, the statement they gave us, they talked about, you
know, the lengthy process they`re saying. It took all 2013 to put
everything in place and get everything lined up for January, but the timing
on this, Kevin, is a little curious in that -- the month of January is when
you`ve had the story about Bellville, about how $6 million for the senior
project there.

There was one yesterday about $4 million in the city of New Brunswick, New
Jersey. The allegations coming out of Hoboken about, you know,
potentially, you know, withheld Sandy aid. It`s in the context of all this
that now the monitoring program it is now up and running.

We should say if the way this law is structured, if the monitoring just
began this month, if we are reading that statement correctly, then the
reports aren`t even going to be due, I think, -- the first reports I think
will be due until June. We really won`t know about this monitoring until
June.

WALSH: Yes. June, maybe somewhat earlier than that, but you know, the
problem here is that they were in violation of state law that whole time.
The state law went into effect right away. They were required when they
made each of those decisions to, you know, look at basic issues. And they
should have told the public if they didn`t have the program up and running.
If the outside folks weren`t there looking over their shoulders, somebody
should have told someone that.

But instead it was -- as with much of the administration and the Sandy
recovery, completely secret, like the HGI decision, completely secret.
Like my organizations need to sue them, they tried to maintain secrecy
there over basic questions about how programs are run.

KORNACKI: Yes. We were trying to find out where they actually, you know,
in violation in law (ph), we couldn`t track it down. The best we could
tell was, this is just a very, very long process. It raises the question
of was this intentionally dragged out, but then, Congressman, it gets to
the point Kevin is making, overall, whether it`s with this program and
everything else, the whole process involving Sandy money has been so
opaque.

PALLONE: Absolutely.

KORNACKI: Why is that do you think?

PALLONE: I mean, you know, you could speculate and say it`s because they
were trying to do all these political shenanigans and didn`t want anybody
watching what they were doing. I mean, that`s certainly a possibility.
But, I mean, it`s just incredible to me, because what -- you know, I get
this every day, Steve. I mean, the public wants to know, am I on, you
know, a list -- waiting list?

A lot of people are told they`re on the waiting list to get their money.
They don`t know what the criteria are. They don`t know what the waiting
list consists of or when they`re going to get off of the waiting list. If
this monitor had been in place, I think that HGI and others would not have
been able to get away with whatever they did because that would have
prevented them. They would have had to have criteria and been out in the
open and been transparent. So, the lack of the monitor is significant,
because it made it possible to do everything in secret and possibly do
things that were wrong or even illegal.

KORNACKI: Right. We wouldn`t be sitting hear saying, whatever it was that
HGI did, we would know what HGI -- because there`d be a report -- be on
file.

Anyway, I want to thank Fair Share Housing Center`s Kevin Walsh and
Congressman Frank Pallone who will be joining us a little later in the
show. Sticking around.

Anyway, coming up, the big, big story out of last night, revelations that
Governor Chris Christie may have known about those lane closures even after
saying the opposite in a two plus hour press conference. What does this
mean for him legally, politically, personally, all that? We got it
covered. It`s coming up next.

(COMMERCIAL BREAK)

KORNACKI: All right. Now, on to the news that brought the political world
to a screeching halt just about 4:00 p.m. yesterday afternoon. It was a
letter from the lawyer for David Wildstein, he`s the former Christie
appointee at the Port Authority who oversaw the closure of those George
Washington Bridge access lanes back in September and with the potential to
change everything.

The letter claims that Wildstein, quote, "contests the accuracy of various
statements that the governor made about him at Christie`s January 9th press
conference" and that Wildstein can, quote, "prove the inaccuracy of some."
The letter also seems to assert that when Bridget Kelly e-mailed her
infamous "time for some traffic problems in Ft. Lee" message on August
13th, the ones which Wildstein replied, "got it," she was communicating an
order from the Christie administration.

That it was not, in other words, a rogue operation. It also states that,
quote, "Evidence exists as well tying Mr. Christie to having knowledge of
the lane closures during the period when the lanes were closed contrary to
what the governor stated publicly." Officially, this is a letter from
Wildstein`s attorney to the Port Authority protesting his decision not to
foot his legal bills.

Given the costs that Wildstein is accruing, this is no small consideration
for him. It should also look at this as something else, a bid for a plea
deal disguised as a complaint about his legal bills. The letter obviously
contains potentially explosive claims and suggestions and portrays
Wildstein as the man with the answers to the mysteries at the heart of this
drama.

This is a man who seems to be saying, I know something. I`ll talk. Just
give me a deal. And as the same message that was conveyed when he
responded to the state assembly`s subpoena last month with reams of
strategically redacted e-mails and texts that raised all sorts of juicy
possibilities and questions. And it`s the message that his lawyer
explicitly delivered when Wildstein appeared before that assembly committee
in early January and took the fifth.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: If the attorneys general for New Jersey, New York, and
the United States were all to agree to clothe Mr. Wildstein with an
immunity, I think that you`d find yourselves in a far different position
with respect to information he could provide.

UNIDENTIFIED MALE: That`s your job. We just want answers to our
questions.

UNIDENTIFIED MALE: Understood. I`m suggesting a way you can get that.

(END VIDEO CLIP)

KORNACKI: Wildstein`s lawyer reiterated that same statement a week later
when he told the "Wall Street Journal" that Wildstein, quote, "wants to
testify" and that, quote, "there is a story to tell." He`ll be happy to
talk if he gets immunity. So, that is four instances of Wildstein and his
lawyer looking for a deal. Something else that broke yesterday afternoon
may have actually been the biggest news of the day in the scandal.

It was a clip by the bombshell nature of the Wildstein letter. It`s a
statement from the lawyer for Christie`s former campaign manager, Bill
Stepian, which seemed to confirm that not only is the U.S. attorney for New
Jersey looking at the bridge closure scandal, that a full pledged federal
grand jury investigation has been convened.

This was the statement from Stepian`s lawyer yesterday explaining why his
client won`t be cooperating with the subpoena from the state legislative
committee looking into the closures, quote, "The potential for Mr.
Stepian`s ensnarement in the ambiguous circumstances that led to the
subpoena`s issuance is undeniable in this case where a legislative
investigation continues to enfold even as a federal grand jury
investigation into the same subject matter."

"Allegations of illegality in connection with lane closures at the George
Washington Bridge last September is being conducted by the United States
attorney for the district of New Jersey." Now, remember, the U.S. attorney
has subpoenaed Christie`s re-election campaign, which Stepian ran.

So, he`s in a different position than most people who`ve been subpoenaed by
the legislature. But that statement seems noteworthy, at least, according
to Stepian`s lawyer, there is a grand jury investigation going on right now
on top of everything else. So, there was the response from the governor`s
office yesterday in the wake of the Wildstein letter, quote, "Mr.
Wildstein`s lawyer confirms what the governor has said all along, he had
absolutely no prior knowledge of the lane closures before they happened and
whatever Mr. Wildstein`s motivations were for closing them to begin with."

As the governor said in the December 13th press conference, he only first
learned lanes were closed when it was reported by the press. And as he
said on January 9th press conference had no indication this was anything
other than a traffic study until he read otherwise the morning of January
8th. The governor denies Mr. Wildstein`s lawyer`s other assertions.

So, that`s where we are this morning. David Wildstein is sending signals
he wants a deal. Bill Stepian is sending the opposite message. He seems
to be girding for a legal battle, maybe a trial. And don`t forget Bridget
Kelly who switched lawyers last week from a close Christie ally to one of
the top criminal defense lawyers in New Jersey.

Will she be looking for a deal too? And what about those subpoenas there
due back with the legislature next week? Will they answer any questions or
will they expand the mystery further? Will pars Wildstein`s statement?
Will pars Stepian`s statement? Will pars the switching? We will talk
about all of it with our panel right after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

CHRISTIE: I knew nothing about this. And until it started to be reported
in the papers about the closure, but even then, I was told this was a
traffic study.

(END VIDEO CLIP)

KORNACKI: All right. Here to talk about all this, we have Suzy Khim,
she`s national reporter with MSNBC.com. We have Congressman Bill Pascrell,
the Democrat from new jersey, and we have Bob Ingle. He`s a political
columnist with the Asbury Park Press who`s written a couple on book on
Christie --

(LAUGHTER)

(CROSSTALK)

KORNACKI: -- full book on Christie and New Jersey`s culture of political
corruption (ph). Well, thanks everybody for joining us. And Congressman,
I`ll start with you because I`m just curious. Your read on this letter
from David Wildstein`s lawyer yesterday because -- when initially we saw
this, we said, Wildstein is saying Christie knew about this from the
beginning and he can prove it.

It turns out he`s saying that there is evidence that Christie knew about it
from the beginning, but it`s not clear that he has that evidence. He`s
saying he does have evidence that contradicts some things that Christie
said about him at the press conference. How do you -- it`s trying to pars
this is an exercise -- what do you think?

REP. BILL PASCRELL, (D) NEW JERSEY: I think you said a mouthful.

(LAUGHTER)

PASCRELL: The participants are always parsing their words, whether it`s
the governor`s office, whether it`s Wildstein, whether it`s Wildstein`s
lawyer. Everybody is being very careful about the language and they should
be. I mean, they could be in court someday under sworn testimony on
criminal issues. This could move in that direction, possibly. I don`t
think it has yet, by the way. So, I`ve read the letter four times. I
think it`s a devastating letter. And when you --

KORNACKI: What in particular would you say is devastating?

PASCRELL: Well -- you know, about the eighth paragraph said he just laid
it all out. It`s come to my light -- it`s come to life that a person
within the Christie administration communicated the Christie
administration`s order, et cetera, et cetera. And evidence exists as well
tying Mr. Christie to having knowledge of the lane closures during the
period when the lanes were closed contrary to what the governor stated
publicly, et cetera, et cetera, et cetera. I mean, that`s a direct
statement. That`s not parsed.

KORNACKI: He is asserting two things there. He`s asserting that -- for
instance, like a Christie defense that may have been plausible to some
people at least, you know, even still currently is that this was like a
rogue operation. It was Wildstein and Baroni and maybe Bridget Kelly and
something like that. And the way he`s wording (ph) this, he`s stating it
as a fact that that Bridget Kellye-mail was communicating the Christie
administration`s orders.

So, he`s stating that came from somewhere higher up the chain. And as the
congressman (ph) said, he`s asserting that evidence exists tying Christie
to -- now, he`s not saying if he has that evidence or where it exists. So,
there`s a little bit of a wrinkle here. What do you make of that?

BOB INGLE, ASBURY PARK PRESS: You`ve done a great job with this. You
really have. And you`ve done a great job of putting it together. But
honestly, the more you report, the more confused I get.

(LAUGHTER)

INGLE: And that is a great example right there. OK. He says evidence
exists, but he doesn`t want to tell us what it is unless he gets immunity.
And that seems to be the bottom line. The guy wants to be off the hook.
And I think, frankly, he`s thinking that he wants to get off the hook
before somebody else gets there first and gets off the hook.

I don`t know if this is push the ball any further down the field to use a
Super Bowl metaphor. I think you and I both knew that there could be
evidence that somebody else had their hands in this and directed it. I
think what`s interesting about it, to me, is he doesn`t -- it`s what he
doesn`t say.

He doesn`t say the governor knew about it and created it and oversaw it.
He doesn`t say that. Somebody did. So, it left me with a lot of
questions. And in the end, I said, well, I really haven`t learned much
more than I have before this came out.

KORNACKI: Well, Suzy, I wonder too, when you look at this, what`s your --
because I mean, look, officially, this is a letter that`s being written to
the Port Authority, because the Port Authority denied paying his legal
bills. And so, I guess, the most benign reading of this would be he wants
his legal bills paid --

PASCRELL: He points out also that they`re contemplating paying Baronis.

KORNACKI: Right

PASCRELL: How can they pay Baronis for crying out loud when he, et cetera,
et cetera, et cetera -- really weird.

KORNACKI: Yes. It looks like there`s a message within the message.

SUZY KHIMM., MSNBC.COM: Yes. So, I definitely think the context of the
letter is something to be looked at. He`s asking to have his legal bills
paid. He`s suggesting there`s stuff out there without -- sort of dangling
a carrot or something in front of -- suggesting that he has stuff. And
sort of -- it`s sort of like a wait-and-see approach.

I guess, (INAUDIBLE) how it responds to it. But the thing that stood out
to me about the passage that the congressman read is that if you compare,
if you read that passage and you compare it to Christie`s response, the
response, the statement that he gave saying -- and Christie responded
saying that, listen, what we`ve been saying all along is totally in line
with what Wildstein has said, which is that we did not have any knowledge
prior to the lane closures happening.

And now, you can sort of get caught up in -- I think there`s a very big
distinction to be made. Wildstein isn`t saying that. He`s not saying that
Christie knew before. He said he knew during. And this -- all of this
kind of goes seems to fly in the face of what Christie said before which is
this is after -- way after the fact when the press reported it, when these
things came out, that, oh, that was when I knew. So, I think that
distinction is actually pretty important.

KORNACKI: Yes. We see Wildstein is tough to decipher. The Christie one
is very particularly -- we`ll talk a little bit more about that Christie
statement and then also, you know, next week is a big week with subpoenas
coming back.

INGLE: Monday and Wednesday.

KORNACKI: Right. Monday and Wednesday. And we have Bill Stepien,
Christie`s campaign manager, making a pretty dramatic statement yesterday.
So, we`ll talk that over when we come back.

(COMMERCIAL BREAK)

KORNACKI: So, we want to talk about what`s coming up next. We have
Wildstein in this letter coming out yesterday. We had Bill Stepien
yesterday saying -- this was the wrinkle with Bill Stepian. He said, "Not
only will I not testify before the legislative committee." Like Wildstein,
he took the fifth. He`s not going to cooperate in providing documents to
the committee.

Congressman, were you -- how are we ever going to get to the bottom of
this? Do you expect this legislative committee is going to get cooperation
from others and it`s going to be able to open this up or is it going to
take the U.S. attorney?

PASCRELL: Stepien is a smart guy, intelligent guy. He could be held in
contempt. The point of the matter is, we have to get to the bottom of this
just as I was mentioning before. We need to know what was behind the
redactions in the information provided by Wildstein.

KORNACKI: Right. All the e-mails --

PASCRELL: We`ve got to get those redactions out of there. We have
(INAUDIBLE). I wrote a letter on September 13th the middle of it. They
never -- how did this all happen? I mean, people were put in jeopardy.
You have homeland security issues here. You have people`s lives at stake
and you`re telling me you can`t get your act together and tell us what
happened now, because you better tell us now.

When we find out later, it`ll be far worse for you. This is what the
mentality is that they should have.

KORNACKI: Yes. And we`re already -- I think, politically, the
consequences of anything more coming out about, you know, Chris Christie
knowing more about this, politically, it`s catastrophic. But now where
you`re getting to the question of legally too, how does it get worse? But
Bob, what do you -- in Trenton, what is the expectation? Take us through
what next week should look like.

With these subpoenas due back, I think everybody in the public wants to
know. We saw the Wildstein records. We saw the Baroni records. Are we
going to see what this committee gets back? Are they going to keep it to
themselves? The U.S. attorney is involved a little bit. How much are we
going to see?

INGLE: I think, the first thing is, they`re not going to get all of the
material that they asked for. It will be delayed somewhat. And then after
they get this stuff, they`re going to go looking through there and decide
what they want to release. They may find something early on and let us
know to keep things going. But, it`s probably going to be a lot (ph)
before we see all the material if we ever see all the material.

KORNACKI: And Suzy, just looking at this from the national standpoint, you
know, you look at Chris Christie`s credibility on the national stage.
We`re talking about this, too. It`s not just Chris Christie. We were
talking about this in the break, too. It was like, thinking back to the
debate over the Sandy funds and how they were held up by some of the Tea
Party was the idea of this money inevitably gets wasted.

And how much of what has come out in the last few weeks and a little bit of
what we`ve reported today, it almost, in a way, you think about the next
fight over federal disaster relief or whatever. This is the sort of story
that can then be used, you know, potentially, to derail it.

KHIMM: Yes -- no, absolutely. Earlier on the show, you play that clip of
Chris Christie very much hitting hard against House conservatives, House
Republicans for opposing the Sandy funds and some did come out for
ideological reasons for this very fact, that they were worried that there
was going to be a fraud and abuse, and in fact, it does look like there has
been a lot of questions of how this money is distributed and why.

Interestingly, though, I think, you know, the way these funds were given
sort of with a blank check to states and local communities, to have them
decide what to do. Typically, this is the argument for ways we can avoid
sort of political horse trading and wheeling and dealing is that, well, you
know, at least we`ll let the states decide. We`re not going to let folks
in Washington decide how to earmark this money and direct it to pet
projects.

But the reality is, if you don`t do that, someone, somewhere along the line
is going to decide how to dole out these funds. Who is going to receive it
and why? And the idea that state and local officials are somehow immune to
that same kind of political horse trading than those kinds of questions is,
you know, this entire thing kind of --

KORNACKI: Politics is politics.

We`ll get a quick break here and we`ll pick it up right after this.

(COMMERCIAL BREAK)

KORNACKI: All right. We`ve actually run overtime for this hour. I hate
this part. I want to thank Congressman Bill Pascrell for taking a few
minutes and joining us this morning. And Suzy and Bob are going to be back
for the next hour. We have some new documents from Hoboken to talk about.

Much more on the Wildstein situation and all the news been breaking in the
last 24 hours about this. So, we`ll pick it up right after this break
talking about the Hoboken documents we have. That`s next.

(COMMERCIAL BREAK)

KORNACKI: All right. There is more new material we want to share with you
this morning on yesterday`s shocking revelation of the George Washington
Bridge lane closures. We are going to be joined by the Fort Lee mayor to
get his reaction.

First, we also have an update on that story we first reported here two
weekends ago, that Hoboken Mayor Dawn Zimmer charged that members of the
Christie administration linked her city`s level of Sandy aid to her
approval of a development project represented by the law firm of one of the
governor`s closest political confidants.

The project in question is owned by the Rockefeller Group that`s a blue
chip real estate development company that would like to build a large
commercial real estate project in the north end of Hoboken. It`s been
represented by the law firm Wolff and Samson and the founding partner of
Wolff and Samson is David Samson, who also happens to be Chris Christie`s
hand-picked chairman of the Port Authority.

It was the Port Authority that paid for a redevelopment study on the land
in Hoboken that the Rockefeller Group owns. It was a study that ultimately
recommended the land be declared an area in need of redevelopment. That is
a designation that would have made the project potentially eligible for tax
breaks and other lucrative benefits.

When Mayor Zimmer appeared on this program, we showed you e-mails that
documented aggressive efforts by Wolff and Samson to move the project along
earlier last year. That was when that study came back. It included e-
mails from Lorie Grifa, who was the firm`s point person on the project,
attempting to connect city officials with David Samson himself for a
conference call about the project.

As we showed you, Samson, himself, was also copied on several e-mails from
Grifa to city officials. I`m getting the full-court press. One of those
officials wrote in apparent exasperation at one point.

All of that raised a basic question of propriety. Is it right for the
chairman of the Port Authority to be enlisted in an effort on behalf of a
private developer in a city that has extensive professional dealings with
the Port Authority?

It also raised the question of whether Samson`s interest in the Rockefeller
project was shared by his political ally, the governor. That`s what Dawn
Zimmer charged on our show, that the Christie administration wanted the
Rockefeller project approved and was using Sandy funding as a lever to get
its way. It`s an allegation to be clear that the Christie administration
has vehemently denied.

This brings us to the new e-mails we obtained this week. This is from
April 24th, 2013. This is after the redevelopment study but before Zimmer
and city officials have decided what to do with it. It`s a lawyer at Wolf
and Samson and is addressed to Steven Marks. He is the assistant city
business manager of the city of Hoboken.

It`s an invitation to go to Trenton, quote, "at the request of the
governor`s office and the NJDEP commissioner." That`s the commissioner of
the Department of Environmental Protection. In the e-mail he makes it
sound like it`s simply a meeting about Hoboken`s flooding issues. The
Rockefeller property isn`t mentioned. But supposedly Lorie Grifa, as Wolff
and Samson`s point person for the Rockefeller, is supposed to attend, which
leaves Marks, the Hoboken City official, slightly confused.

"If this is a meeting between city and state, please explain what role
Lorie Grifa has in this," he writes. "I`m sorry. I don`t understand."

The Wolff and Samson attorney replies to that in another email, "This is a
meeting set up by us for our client, the Rockefeller Group. NJDEP has
requested that the city send a representative as well. Sorry if it wasn`t
clear before."

Marks then asks for an agenda and a list of attendees. And you can see the
response here. Global flooding solutions and flood control measures and
permitting waivers for flood measures based on new revelations are all on
the agenda. These are all items that Zimmer had banned and still is
raising concerns about, her city`s overall preparedness for another Sandy-
like flood.

But look at number two. Review of concepts for flood control measures at
Rockefeller property in Hoboken, previously presented to the governor`s
office. And you can see the list of participants, state officials, Wolff
and Samson officials, and someone from the Rockefeller Group.

We`ve also found an e-mail several messages taken from Mayor Zimmer by her
staff from last year and early this year that show the office of Michelle
Brown who runs the state economic development authority, trying to arrange
a meeting with Zimmer and Mark Ferzan, who was deputized by Christie to
lead the Sandy recovery effort in New Jersey.

Quote, "Governor Christie has instructed Ms. Brown and Mark Ferzan to meet
with you regarding the Economic Opportunity Act of 2013 and Sandy
recovery," one the messages reads. That meeting has yet to take place
apparently due to scheduling conflicts.

There is no smoking gun in these documents. But the e-mails do indicate
that the Rockefeller project was on the Christie administration`s radar,
and the administration`s apparent desire for Zimmer to meet simultaneously
with the administration`s point person on economic development and on Sandy
aid is at least suggestive of the kind of explicit coupling that the mayor
is alleging, Sandy money in exchange for expedited development.

We asked Christie`s office yesterday if the administration wants to see the
Rockefeller project in North Hoboken go forward. Their spokesman did not
address our specific question. He did tell us that these e-mails and
messages are related to a different federal program entirely. They are in
the process of rescheduling the meeting to accommodate federal officials.

Zimmer, you may recall, told her story to the Office of the U.S. Attorney
for New Jersey the days after she appeared on our show. And days later,
FBI agents came to Hoboken to interview members of her staff. And
yesterday afternoon, the U.S. attorney served a subpoena on the city of
Hoboken asking officials to turn over documents relevant to Zimmer`s
accusations. Her spokesman said that the city is complying.

This came just after the Rockefeller Group late Thursday formerly severed
its relationship with Wolff and Samson. Given the investigation, the
spokesman for the developer said, we`ve decided to shift our work on the
project to another firm.

Here to talk about all of this and everything happening out of New Jersey,
in what has been a crazy 24 hours, Brian Murphy, reporter and professor
with Baruch College, Bob Ingle, with the Ashbury Park Press is still with
us, Suzy Khimm from MSNBC.com is sticking around, and Congressman Frank
Pallone is back at the table. And, Congressman, I`ll start with you on the
Hoboken matter, because we have the George Washington Bridge investigation
going on, on the one hand, and you have all the David Wildstein talk we had
last hour.

But on the other hand, there is still this question of Hoboken and the
allegations from the mayor. And since she sat in the show, and you were on
just after her day, she`s talked to the U.S. attorney, the U.S. has talked
to her staff. Now, we see Wolff and Samson`s partnership with the
Rockefeller Group is gone and now, you have the U.S. Attorney`s Office
subpoenaing all these records from Hoboken.

I mean, this is a serious investigation that`s moving along.

PALLONE: I mean, it`s very serious. And, you know, the Christie
administration has been pushing back and trying to say that mayor Zimmer is
not telling the truth or she is misunderstanding what went on here. I
think what you have uncovered with those e-mails, you know, the coupling
again with the Rockefeller development project with the Sandy aid and the
flood control is just more evidence that she is telling the truth and that
what she is saying is likely the case.

And, again, it`s disturbing to me for all the reasons we discussed, which
is Sandy aid is supposed to be for those that suffered from the flood.
It`s not supposed to be linked to development projects or other housing
projects that had nothing to do with the storm.

And, again, this is very disturbing and we`ve got to get to the bottom of
it because there is clearly the pattern of abuse of power, you know,
culture of threats or bully that`s linking these things, linking
development programs, saying we are going to send money to housing or other
projects that don`t have anything to do with the storm. And that`s not
right.

And it contributes to this atmosphere in Washington, as I said to you,
Steve, many times. When we were trying to get this passed Sandy package
passed, there were those in the West and the South that were saying, we are
not going to send it to New Jersey and New York, you are not going to use
it wisely. You are corrupt. You are going to waste the money.

And the last thing I need as I federal official is to have that verified
because the, you know, there is a "we told you so", and what happens in the
future when we want to get money for natural disaster or anything?

KORNACKI: Well, that`s right, the reason we asked the administration, we
wanted to ask them the simple question of, hey, did you support this
project? And that`s a key part of this. There has been other reporting
this week. I think "The Wall Street Journal" had a story that looked at
this Rockefeller project in Hoboken.

You could make a case if you are the governor of the state and you want
commercial development in your state, you want the tax base, you want the
jobs, you could make an argument for this project. But there was a story
in the "Wall Street Journal" that showed that Mike DuHaime, who is one of
the top political deputies of Chris Christie. His firm took a poll on
behalf of the developer and shared the poll with the mayor of Hoboken a
year or two ago, basically saying, you know, there were two things popular
in Hoboken right now, Mayor Dawn Zimmer and this development project.

So, you`ve got Mike DuHaime, who`s very close to Chris Christie politically
working on behalf of this project and they still won`t answer the basic
question, you know, is this a project you guys want?

BRIAN MURPHY, BARUCH COLLEGE: The simple question -- I mean, that`s kind
of in the reporting on this, right? I mean, the advances that we`ve made
have come when simple questions just can`t be answers. Like where did the
money go? Why do you support this project?

It should be obvious. You shouldn`t have to have kind of a panicky answer
to this because it just makes people like us more suspicious.

But, right, I mean, you look at this, and here is the poll. It is
forwarded by someone who worked for a Democratic elected official who we
both know and the project is represented by another person, or worked with
Democratic official, it just seems like Rockefeller has done a great job of
lining up all the people that have to be involved on this, which is fine,
except then you start to see the coordination coming out of Trenton.

That`s sort of been my question. What`s the chain of custody for how
people in Trenton and how people in the statehouse understood this project?

Why did he hear about it? Why is there buzz about this at all in the
statehouse when there are a million other things going on that should be on
people`s minds? Why is this getting filtered to the mayor of Hoboken?

The word on the street is that you don`t back this project. How did that
happen?

KORNACKI: And, Bob, what do you -- what do you make of the way the
administration has dealt with the questions that have been raised by Dawn
Zimmer? I mean, we`ve had the one public statement from the lieutenant
governor. The lieutenant governor is accused explicitly by Dawn Zimmer.

We understand there are some legal questions here maybe to prevent here
from saying more. But in general, the administration has not tried to
clarify -- yes, we absolutely wanted this project. No, we in no way --
they haven`t explained much on this it seems. So, all of the questions are
just sort of hanging there.

BOB INGLE, ASBURY PARK PRESS: I like that memo that you read that they
explained that they needed to talk about the flood control for that
particular part as opposed to the rest of the area.

(CROSSTALK)

INGLE: It is eight feet under water.

KORNACKI: Right.

INGLE: Now, that sounded like a stretch to me. I don`t know about you.

But what -- it looks like to me what they are trying to do is discredit
her. Now, obviously, I think what we have had is a she said/she said kind
of thing. It is going to be very difficult to prove that maybe she said
something and it was misunderstood and that kind of thing. But there does
seem to be an on going attempt to discredit Dawn Zimmer.

KORNACKI: Suzy, do you think -- it is the age-old strategy, right? You
attack the attacker or the messenger, whatever it is.

Do you think that approach from Christie, have they succeed at all? The
line you heard right away was, well, this happened supposedly in May of
2013. She was told by the lieutenant governor and her version that your
Sandy aid is linked to this development project. She is not coming forward
to January, 2014.

I have heard that message a lot. Do you think that resonates with people
at all? Has that attempt to discredit her on those grounds worked at all?

SUZY KHIMM, MSNBC.COM: I think it definitely -- people`s questions still
stand out in people`s minds. But I think of it more fundamentally. The
fact we just don`t understand the basic chain of events. Why did this
project get pushed forward? Why -- you know, where do these things emerge?
Where does the governor`s office stand in relation to those?

I think those are more fundamental questions people have in mind. I mean,
the congressman`s earlier point about the public`s trust in federal
spending and how that money gets allocated.

One thing that`s stood out to me is why we even care about where this money
went and the assumption you are going to be cynical about it. There is
always going to be some political favors to be had, is the fact that this
is emergency relief money, is the fact that a year after Sandy, there are,
you know, 26,000 people in New Jersey still displaced from their homes.
Tens of thousands of people who still haven`t gotten the home repairs that
they need, and the fact that those people are being shut out, those people
aren`t getting answers about, why was my application rejected? Why haven`t
I heard back about where this stuff is coming from?

I mean, I think it`s important to keep that in mind about why we care about
how the money was spent and who it was given to and the grounds on which
those decisions were made.

KORNACKI: I think another significant thing is the announcement by
Rockefeller that they are severing ties with Wolff and Samson, because,
look, without getting the specifics of this one, because I don`t know the
dynamic between Rockefeller and Wolf and Samson, I do know and I think you
all know covering New Jersey, when Chris Christie got elected governor, the
word kind of went out that Wolff and Samson is the firm you want to hire,
the firm you want to be associated with.

This is the firm of Christie`s confidant. He wanted to get things -- I
mean, that`s sort of the standard message, when the governor comes in,
there`s the preferred law firm or whatever -- to have a group as
prestigious as the Rockefeller group, not just cutting its ties with Wolff
and Samson, but doing it in a very public way, suggests to me there might
be a turning point here of sorts.

MURPHY: Well, Chris Christie hasn`t cut his ties yet, has he? Neither has
the Port Authority. The Port Authority board meets this week, this coming
week. David Samson is going to chair that meeting.

KORNACKI: And there was a report, I want to say it was in WNYC yesterday,
that said people around Chris Christie raised the possibility of removing
David Samson as the Port Authority chairman. But Chris Christie himself
wouldn`t hear of it.

Anyway, we will pick this up. We have more on this on the other side.

(COMMERCIAL BREAK)

KORNACKI: All right. Let`s piggy it back. Bob, I know you were about to
say something before the break there. Go ahead.

INGLE: Yes, I was going to tell that I am thinking about the vibe in the
statehouse from the people associated with this investigation, that the
wise course is to concentrate on the bridge, not Hoboken. Now, that can be
interpreted in many ways.

One of them could be that maybe this attempt to discredit Dawn Zimmer is
working.

KORNACKI: Also, it is one that we know that is definitely in the hands of
the U.S. attorney, from the legislative standpoint. The committee seems
certainly further along too with the bridge investigation. But we were
talking about this too during the break. I think it is an interesting
point to raise about Dawn Zimmer and coming forward and all this. One of
the things that struck me was to this question of why is she doing this
now.

You know, she could have -- if her goal was just to score a political hit
against the governor, against Chris Christie, there was a logical and risk-
freeway of her to do it because if you remember the context of her coming
on this show? Before then, everybody was raising the question of -- did
she lose Sandy aid because she didn`t endorse Chris Christie for re-
election? And you just had that story about the mayor of Jersey City.

And so, it would have been very easy for her to say, yes, I didn`t endorse
him. I`m convinced that`s why I lost my Sandy aid.

Most of the media was ready to accept the story. And, you know, instead,
it made what she was saying a little more credible to me, because she is
going way out of her way to expose herself to a lot more risk, to
essentially make the same claim that her Sandy aid was held up.

KHIMM: Yes. And I think on your point about the fact that there already is
an attorney`s investigation into what Dawn Zimmer has talked about. I
mean, to me, one of the most interesting things that has already come to
light is the fact that some of her closest aides were interviewed and said
that at least two of them said that she had told them at the time that this
was happening. That this wasn`t something that somehow concocted over the
last couple of days or last couple of weeks, saying all of this might
chance to get at Christie, that this was something that she raised and it
concerns her enough that she actually talked about it with her staff.

I think that`s the kind of evidence that it is going to make -- improve her
credibility and sort of really get to the point that there is something
going on here. That may be part of the reason that there might not be as
much impetus to do their own digging, the fact that that stuff has come to
light, to add credibility to her story.

KORNACKI: I want -- and as soon we left the panel, I want to switch back
then to the Wildstein news and to the idea of Christie, if Wildstein or
somebody else can prove that Chris Christie was not being straightforward
in that press conference. This was right after the Wildstein letter came
out yesterday.

"The Star Ledger" put an editorial up, the headline was, "Chris Christie
should resign if bombshell proves true. Wildstein claims there`s
documentary proof that the governor was lying. If this proves to be true,
then the governor must resign or be impeached, because it will show that
everything he said at his famous two-hour press conference was a lie. And
not just a typical political lie, this was like a Broadway show of lies.

It would leave Christie so drained of credibility that he could not
possibly govern effectively. He would owe it to the people of New Jersey
to step aside. If he should refuse, the legislature should open
impeachment proceedings."

Congressman, "The Star Ledger" using the I-word there. Last night, I was
on Chris Hayes` show, State Senator Ray Lesniak talked about potentially
going in that direction. I mean, is that the level we`re at now?

PALLONE: I think so. I mean, I think they are right on point. I mean,
the fact of the matter is that Wildstein in that letter is essentially
saying that the governor lied in terms of what he knew and when he knew it.
If that is accurate, I don`t think he can stay in office. I mean, you saw
that two-hour press conference. If the governor is lying publicly like
that, how does he stay in office? He has no credibility. And, you know,
that`s it.

KORNACKI: What`s the motive among Republicans in Trenton, Bob? How are
they -- how are they reacting to all of this?

INGLE: I`ll try it on the record, they support the governor.

KORNACKI: Right.

INGLE: Surprise, surprise.

I see a lot of worried looks. I see a lot of worried looks in the
administration. People who seemed to have concerns just behind their eyes
are worried about something, waiting for the next shoe to drop.

MURPHY: Everybody -- I mean, we`ve had this conversation. Everybody hired
the people you would hire if you thought you were in very big trouble.

KORNACKI: The lawyers.

MURPHY: Yes. I mean, everybody lawyered up. And they didn`t lawyer up
with people. You know, if you had a political problem you had to fix,
you`d hire an old hand, someone who could smooth things out for you.

They all hired white collar criminal lawyers. They all hired the kind of
lawyers like, you know, that people sitting around saying, boy, if I ever
got into trouble, I`d hire this guy. I`d hire Michael Critchley.

KORNACKI: Michael Critchley, Bridget Kelly hired Michael Critchley -- one
of the top defense lawyers in New Jersey. His claim to fame I guess that
trumps all these other claims is that he beat the U.S. attorney.

MURPHY: Right.

KORNACKI: He beat the U.S. attorney in that whole operation big rig
roundup. That is -- that`s her attorney. And the reversal for Bridget
Kelly from -- she was originally represented by this guy, Walter Timpone, a
defense lawyer, very close to the Christie world. And she was sending to
this "New York Times" article she didn`t want to embarrass Chris Christie
anymore. Then, she hires Mike Critchley.

And you`re saying, that seems -- we talked about Wildstein. We talked
about Stepien. But Bridget Kelly seems like a major wild card here.

KHIMM: Yes, just in terms of the editorial pages and the response I think
from the general public might not necessarily be following every single
incremental development. She might become confused to legalese.

And understand this, that there is concern about what Christie knew and
when he knew it, what -- whether or what he says, was said during that
press conference is actually true. I mean, Christie himself made the point
that the single biggest offense his aides, the ones that he fired, made was
the fact that they lied to him.

If it`s true that Christie has lied, has misrepresented what he knew and
when he knew it, that sort of thing, I mean, that`s when you get these
headlines on the tabloid saying, Christie knew. I mean, that`s going to be
the takeaway that folks are going to take, regardless of all the other kind
of layers of this. I think politically speaking, I think that`s why you
are getting this sort of impetus, saying that he should step down if this
is true.

INGLE: Well, he would have to know where he was putting himself in that
marathon two-hour press conference. He would have to know if evidence came
to light later on, when that was going to leave him, because we`ve all got
that on tape.

KORNACKI: Well, and that was funny to say, because I -- first thing, I
have shared this story on other shows. The first thing I have thought of
when he was, when he seemed to put himself in the corner on the conference
was Bret Schundler. He called Bret Schundler a liar, his education
commissioner in 2010.

INGLE: Right.

KORNACKI: And he knew -- he had to know that there were documents out
there that could have disproven that. And Schundler came out with them.

INGLE: And one thing that Schundler couldn`t stand, where he could say,
OK, I made a mistake but he couldn`t stand being called a liar. He felt
too much of his good name for that. He came out fighting and it turns out
he was right.

KORNACKI: And now, Bridget Kelly, who he called a liar about five times,
has Michael Critchley as her defense attorney. That`s why I said, boy,
there`s one to watch right there.

I want to thank Congressman Frank Pallone, for coming in today. I
appreciate that.

One of the central players in the George Washington Bridge saga will join
us live at this table, right after this.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MAYOR MARK SOKOLICH (D), FORT LEE, NJ: David Wildstein deserves an ass
kicking, OK? Sorry. There, I said it.

(END VIDEO CLIP)

KORNACKI: It`s one of the main players in the Chris Christie bridge saga,
Mark Sokolich. He`s the mayor of Fort Lee whose town was turned into a
virtual parking lot because of David Wildstein and whoever else did that
week in September to shut down those access lanes.

And here now at the table is the mayor of Fort Lee, Mark Sokolich.

Thank you for joining us this morning.

I guess I got to start -- did you take the George Washington this morning
and how was the commute?

SOKOLICH: I certainly did and it was clear sailing.

KORNACKI: OK. Clear sailing early in a Saturday morning. I think that`s
one of the benefits. So --

SOKOLICH: And ample names available to Fort Lee, I`m happy to report.

KORNACKI: The Fort Lee-only lanes that people from all these other towns
use.

SOKOLICH: Steve, we only wish they were Fort Lee only lanes. They
certainly are not.

KORNACKI: Now, I can tell you -- I lived in Hoboken for a while. When I
would use the George Washington Bridge, would I use the Fort Lee-only
resident lanes. I can vouch for that not being just a Fort Lee situation.

We played that -- you will forever be remembered if nothing else in this
world for that comment about David Wildstein on this network a few weeks.
But David Wildstein, obviously in the news in a big way yesterday, with
this letter to the Port Authority hinting that there is evidence out there,
he doesn`t say if he has it. But there is evidence out here that Chris
Christie knew about this while it was going on, knew about these closures
while it was going on.

I wondered of what you make of, of what David Wildstein had to say through
that letter.

SOKOLICH: You know, you`ve got to really read the letter. It`s an
artfully written lawyer letter. It`s what I do for a living as well.

You know, the first part of it asks for the port to reconsider their
rejection of Wildstein`s request for legal fees and gets into some conflict
of interest issues, and then essentially concludes with this, that there
was knowledge on the part of the governor.

It doesn`t say before. It says during the lane closures.

I`ve said this many times in the last day -- if during the lane closures
means that Monday, September 9, and no action was taken for the next four
days, you know, in my mind, that`s a big problem, because your solemn oath
would have dictated that you protect, you serve and you do whatever it is
that you need to do in your power to make sure that retribution does not
continue and put people in harm`s way.

If he found out on Tuesday, still a problem. Wednesday, still a problem.
Thursday, a problem but less of one rather than Monday.

So, I think it`s a question of timing. I don`t want to prejudge anyone. I
can appreciate the context under which the letter was written but it`s
certainly a damming letter.

KORNACKI: But when you say Monday, a big problem, Thursday, less of a
problem. There is also the issue of if Chris Christie knew about this
while it was playing out.

There`s still the issue of the next few months, while you`re raising
questions, while Loretta Weinberg, while -- the media is raising questions,
all sorts of people are raising questions about this -- if Chris Christie
knew about this that week back in September, and spent those next few
months ignoring it and not asking questions, not disciplining anybody on
his team and openly mocking people who asked him about it, that`s a serious
problem too, isn`t it?

SOKOLICH: Yes, it`s a real big problem. It`s also in complete
contravention of what he said in the two-hour press conference and what he
represented to a very small group in Fort Lee when he came up to apologize,
which again, I`ve always said I have taken him at his word, along that
line.

This isn`t rehearsed. I`m saying it from my heart. There is a debt of
gratitude that Fort Lee owes folks like you, because think about it -- if
this story wasn`t followed by the Lorettas and by the Steves and the
Rachels and so forth, and so on, and if this never came to light, as Fort
Lee`s mayor, I`d be waking up every morning wondering what will fall upon
us on that particular day. So, we`re appreciative.

KORNACKI: Well, I thank you.

So, I wonder now, since this story has gotten so much coverage and since so
much has come out and will continue to come out, do you have any more
insight, do you have any more thought about the root of all of this? Why
did this happen to your town? Why an e-mail went out for Bridget Kelly
saying, time for traffic problems in Fort Lee. The only theory that`s ever
been put out there, that frankly, the idea that you didn`t endorse Chris
Christie and this is what happened to you. I have always suspected there`s
got to be something else. I don`t know what it is.

But do you have -- do you have any more insight or any more thinking about
what it was that was at the root of this? Well, you too seem to agree with
my theory, which is, I`m not important enough. I said that from day one.

KORNACKI: I don`t mean that way.

SOKOLICH: No, but I agree with you. I mean, look, from September 9th, at
6:30 when my police chief was given direct orders by me that he is to do
nothing else other than to deal with the traffic and find out what`s going
on, the rumors continue to come back to me, that hey, mayor, I`m hearing
this is about you. Ten minutes later, mayor, I know you don`t want to hear
it but I`m hearing this is about you.

So, from that September 9 day, there was always that doubt in my mind.
When we didn`t get any response and we came to Tuesday, and again, the
traffic cones removed, no respond from the port, all the digging by the
chief and my office and me finding out it was about me. You start to
question your judgment.

I mean, once we got to the end of that week, I was pretty convinced it was
about me. I`ve also been the guy that`s been saying, look, I don`t feel
like I was ever directly requested to endorse Governor Christie.

But, you know, it definitely was a gradual courting. We have engaged.
There was dialogue where people would tell me about who -- for example, we
would start off with a litany of folks in describing who was now endorsing
Governor Christie. Then, I would be asked, hey, what do you think about
that? Would you consider that? I never viewed that as a direct request.

KORNACKI: But was there I guess the reason I say, it`s not that you`re not
important enough, it`s just that the one thing that sort of made sense to
me from Chris Christie`s press conference. was when he said, there were a
lot of -- New Jersey is 565 municipalities. There are a lot of Democratic
mayors and municipalities. And the overwhelming number of Democratic
mayors didn`t endorse him and didn`t endure what your town endured.

So, I wonder -- I suspect it is about you, but I wonder, is it about
something else, some other dealings you had with the administration or its
allies? Anything like that?

SOKOLICH: I don`t want this to sound too self-serving but let me give you
a legitimate answer. Fort Lee is the community of 37,000 people. We are
in the middle of an incredible renaissance. As you`ve heard me say a
million times, we are the host community right now to an ongoing $1 billion
project, redevelopment initiative.

We`re the gateway community to the state of New Jersey, our first 47 tower,
incredibly, architecturally advanced tower has now topped out. A second
one is on its way, a new retail section is being built. There`s a lot of
stuff going on in my town.

We have been called one of the more progressive towns in the state of New
Jersey. We have been called one of the best communities for young
professionals to move to in the state of New Jersey. There`s just been an
entire culture change in Fort Lee. We are excited about it.

So, you know, I`m not the prize but I`ve got to tell you, I think Fort Lee
is the prize. I know I`m its mayor and I am supposed to sing its praises.
But it`s the truth.

We are incredibly progressive. We`ve been met with phenomenal success
lately. Our tax rate has stabilized. Our bond debt is down. There`s a
lot of good things happening. And I think on a very -- when you are
successful and your town is successful, it`s a plum to be able to say that
the gateway community to the state of New Jersey, the host community to the
busiest bridge in the world is on my side.

I`m only speculating. But I don`t think that`s too far fetched.

KORNACKI: Well, you have mentioned it before and we have talked about it a
little bit on this show. There is that $1 billion redevelopment plan that
is centerpiece of your agenda. It`s sort of at the foot of the George
Washington Bridge.

The idea -- if nothing else, the Chris Christie put out there during all of
this, that, oh, I wouldn`t know who the mayor of Fort Lee is, he would know
who the mayor of the town you just described with a project like that
sitting at the foot of the bridge, he would know who that mayor is. If
nothing else, when you start looking at what`s going on in Fort Lee, when
you start looking to that project, the idea Chris Christie would have no
idea who you were through all of this was never credible or believable to
me.

I want to thank Mayor Sokolich for joining us this morning. I really
appreciate you taking the time and coming in here.

SOKOLICH: My pleasure.

KORNACKI: How to interpret that new Wildstein letter. Is he angling for a
deal through the media? Is that the strategy that could possibly work? We
have two experts, one who talk down a politician, another who defended one
successfully. They`re going to join us to dissect it, next.

(COMMERCIAL BREAK)

KORNACKI: It`s still unclear what those two big letters released
yesterday, one for the attorney for former Port Authority official, David
Wildstein. The other from the attorney for former Christie campaign
manager, Bill Stepien. It is still unclear what does two letters mean for
the governor politically. And legally, well, that doesn`t look like an
open and shut matter either.

So, here to analyze those two letters, the two different strategies that
both of those men are pursuing, I want to bring in former federal
prosecutor, Paul Butler, specialize in public corruption. And joins us
from Washington, and from Houston, criminal defense attorney, Brian Wice.
They are becoming our legal dream team of sorts.

We thank you both for joining us this morning.

And, Brian, I`ll start with you, because the interpretation I have had and
a lot of other people have had of this letter from Wildstein`s lawyer was,
sure, officially, he is trying to get his -- the Port Authority to pay for
his legal representation. But this is the fourth in a series of sort of
pleas for some kind of immunity deal. I`m wondering if you read it that
way and if you do, can you explain to me the logic of pursuing that through
the media and not behind closed doors?

This is the fourth in a series of sort of pleas for some kind of immunity
deal. I wonder if you read it that way and if you do, can you explain to
me the logic of pursuing that through the media and not behind closed
doors?

BRIAN WICE, CRIMINAL DEFENSE ATTORNEY: Sure, I think it`s simple, Steve.
David Wildstein has all but gone to the center span of the GWB and said,
I`m the guy. I`m the guy that can give you the governor. I`m the guy who
can connect the dots. I`m an appetizer. I can lead you to the entree.

And it`s no surprise that he has gone and hired Alan Zegas, who is a deal
maker. In any jurisdiction, I think Paul has my back on this, there are
dealmakers and there are litigators. And there are guys who you`re going
to hire if you want to go to Defcon 1 and ultimately put the state to its
burden of proof, or in this situation where you think you are the one who
can give the investigators everything that they want.

I think this is amazing that David Wildstein has now basically come front
and center and said, what we have all said on this show, but it bears
repeating. The first guy to the courthouse ultimately gets the best deal.

KORNACKI: So, Paul, the public nature of this, though, because it`s one
thing if Wildstein and his attorney quietly went to the U.S. attorney and
said, here`s what we`ve got. Here`s what we are willing to tell you.

Presumably, the U.S. attorney would be open to that conversation, maybe he
would, I don`t know. But to be doing this so publicly like this, is this
telling us anything? Is this too desperate? Is it --

PAUL BUTLER, FORMER FEDERAL PROSECUTION: Part of what he is trying to do
is get his lawyer paid and as a member of the profession, I have to say, it
is a good thing when people pay their lawyers.

But the other thing is, he talks about some evidence that connects Christie
to bridge-gate. Well, the prosecutor doesn`t need his cooperation to get
that evidence. Here is why the prosecutor is the most powerful actor in
the criminal justice system. He has this extraordinary subpoena power
where he could subpoena every document, every text message, every e-mail,
every phone log that David Wildstein ever touched.

And David Wildstein can`t claim the fifth for that. And the other thing
the prosecutor has on his side is time. He is going to take his time to
follow these leads wherever they go. So, he is not in any hurry to make
any decisions about who do immunize.

He is not thinking about the Republican primary season or the presidential
election. All he is thinking about is, can he make a case against Governor
Christie?

KORNACKI: So, you just -- what you just said about all the information
that the U.S. attorney can get access to without David Wildstein cutting
deal, without anybody else cutting a deal, under what circumstance, as a
federal prosecutor, would you need to cut a deal with somebody like David
Wildstein?

BUTLER: Well, you can`t compel him to testify. So, the Fifth Amendment
protects testimony. So, if you need him to come to court, or come to some
kind of pre-court proceeding and say what he actually did, then that`s what
you would make a deal.

But, you know, if I`m thinking about who I`m making a deal with based on
what we know now, I`m looking more at Bridget Kelly than I on that
Wildstein. You know, she is a very sympathetic, loyal lieutenant, single
mom of four kids. Does anyone think she went off reservation and was doing
all this stuff without higher-ups knowledge?

Most people think that, you know, other people knew. She was just
following orders.

So, at the end of the day, I think she was a more compelling witness.

KORNACKI: That`s interesting. You`re already thinking of terms of whose
the more credible witness for the jury. Brian, one thing I want to ask you
about too, is Wildstein`s lawyer in this letter. And, again, it is such a
carefully worded letter. He says there is evidence that his client has
evidence that can undercut claims that Christie made about him in that
January 9th press conference.

Then, he just states that there is evidence out there that Chris Christie
knew about these lane closures as they were happening. He does not state
that Wildstein was in possession of that evidence and has that evidence.
It seems like there a fine line there trying to walk there because if
Wildstein were to say he has that evidence, then it would raise the
question of why he didn`t present that evidence to the legislative
committee when he was subpoenaed.

Is he in any danger there?

WICE: No, not really I think from the very beginning. When you have
parallel investigations, the legislative investigation really is kind of
AAA baseball, if you will. Paul Fishman`s investigation is the show.
That`s the investigation where careers will be made and lives will
ultimately be ruined.

Look, going all the way back to Watergate. The ultimate question any time
there is an investigation, is what did the lead suspect know and when did
he know it. And in this case, certainly, David Wildstein`s positions, I
can answer both of those questions.

But I totally agree with Paul. I think that he and I have agreed from the
get-go that Bridget Kelly is a much more likely domino to roll.

Again, as he said, sympathetic, seemingly credible, a single mom with kids
to feed. In this situation, I think any prosecutor who is going to cast
the female or the male lead is looking for somebody who will play well at
4:00, 5:00, 6:00, and 10:00 and on this show on Saturday and Sunday
morning, Steve.

KORNACKI: And, Paul, just one final quick question. The other guy who had
an issue, was Bill Stepien, the former campaign manager refusing not just
to testify before this legislative committee, but to turn over documents as
well. Again, Brian is saying the legislative committee is sort of AAA
baseball in all this.

But is there -- are there serious consequences potentially for not turning
over those documents even to that committee?

BUTLER: Now, you know, it`s what a good attorney would do. There is this
complicated Fifth Amendment doctrine called the Act of Production Privilege
which means that you don`t have to turn over documents. That there is
something about the act of turning them over that would incriminate you.

But you almost never win. When lawyers make those motions, it`s just a way
of buying time.

KORNACKI: OK, buying time. That`s just a delaying tactic.

Anyway, I want to thank former federal prosecutor, Paul Butler, criminal
defense attorney, Brian Wice.

You have probably heard me say it before. Before David Wildstein was in
national news, he was my boss. The same goes for another one of our
panelists today. So, we are going to talk a little bit about the David
Wildstein that we know and what you should know about him. We will do that
right after this.

(COMMERCIAL BREAK)

KORNACKI: As many viewers have probably heard me say before, David
Wildstein was my boss when I worked for his nonpartisan New Jersey
political news site, politicsnj.com. It was called. That was several
years. And joining me now is Brian Murphy. He`s another journalist who
also worked for Wildstein, for that site and his first hand experience to
the man now at the center of the bridge-gate scandal.

The man who through his lawyer has accused Christie of lying about his
knowledge through GW Bridge lane closings, since there is evidence to prove
it. Brian Murphy now professor at Baruch College who wrote for
PoliticsNJ.com in 2002 joins me now.

Brian, summer of 2002, I will always remember this. I came down from
Massachusetts to New Jersey to work for this anonymous Web site edited by
this guy under the pseudonym Wall Edge. It was David Wildstein. I didn`t
know it. You were leaving the reporting job. I was taking it. I met you
at the tick-tock diner.

(CROSSTALK)

MURPHY: Disco fries.

KORNACKI: Disco fries. He drew me a map of the politics of New Jersey.

(CROSSTALK)

MURPHY: I should have kept that map.

But, so, we`ve both had this interesting experience of watching this man
who we knew as anonymous and we found who he was in the middle of the
something I think neither one of us ever thought we would see him. I
wonder from your perspective, watching all the coverage of David Wildstein.

What do you think people should know? What is the one thing people have
been hearing about him in the news? That news is getting wrong about David
Wildstein.

MURPHY: I think the complication, the relationship with Christie is more
much complicated than we would -- than people understand or let on, right?

So, the line that Christie had at the presser on the 9th about him, you
know, sort of being this scholar athlete. I didn`t mix with David
Wildstein. They weren`t buddies.

And so, it`s true, they weren`t best friends. They knew each other. But
they weren`t best friends. But they are two very different kind of
personalities.

I mean, David Wildstein is a details guy. He would be the kind of -- I
think doing something that would gratuitously insulted him at that press
conference was a mistake, was a big strategic mistake, sort of taking the
like Greg Marmalard scholarship athlete thing and saying, I would never
hang out with Delta House.

That was a wrong tack, because I think David Wildstein was a fiercely loyal
boss to have.

KORNACKI: Yes.

MURPHY: And if you have him as a supporter, that`s great. That`s a great
supporter to have in your corner. It strikes me -- he strikes me as an
extremely -- I don`t know if I`d use the word dangerous, he would be a
formidable opponent.

KORNACKI: Well, yes. I mean, I`ll tell you just my experience of working
with him, the loyalty to I was on his team, I was his guy, and he had my
back.

MURPHY: That`s right. That`s right.

KORNACKI: There was -- New Jersey politics is a tough business, reporting
on, when you`re 23 and it`s easy for everybody to kind of -- they don`t
have to take you that seriously.

MURPHY: Sure.

KORNACKI: Him having my back I can look at so many times when that was
hugely beneficial to me and to the site. The flip side of it is, the
people on the receiving end of that, the campaigns that were giving us the
hard time, the legislator offices that were still along, I didn`t want to
be in their shoes because he knew how to deal with them aggressively.

MURPHY: No, and he -- I mean, he collected -- he clearly was a guy who
saves paper. Right? Which in a case like this where papers are being
subpoenaed from you and records are being subpoenaed from you, and we just
don`t know what his -- what were in the file boxes that were carried out of
the Port Authority that day in his car, right?

KORNACKI: Yes.

MURPHY: And he hints at that in the letter. The commissioners, maybe he`s
got stuff on recusals that should have happened that didn`t happen. We
just don`t know.

But there is evidence that exists. And that`s the claim --

KORNACKI: That`s the other thing I try to get people to understand about
him. He is a long-term strategic thinker.

MURPHY: Right.

KORNACKI: He prepares for contingencies. He wants to be ready.

MURPHY: Not going to be without a chair when the music stops.

KORNACKI: Exactly. Exactly right.

All right. Hope that is a little insight to David Wildstein from two
people that worked for him.

What do we know now we didn`t know last week? Our answers, right after
this.

(COMMERCIAL BREAK)

KORNACKI: Just a few seconds left for a New Jersey/Super Bowl/whatever you
want edition of now we know. Let`s start with you, Susie.

KHIMM: So what I learned this week is there are at least some Republicans
who really miss Mitt Romney. Who really -- there was a poll done of New
Hampshire Republicans in which, you know, they threw out a whole bunch of
names for 2016 including Chris Christie, Bobby Jindal, whoever have you,
Mitt Romney came in first at 25 percent.

KORNACKI: There it is.

KHIMM: Chris Christie, maybe 16 percent, 17 percent. Maybe folks, you
know, are kind of pining for the days in which the problem with the
candidate was they were too clean cut.

KORNACKI: Christie crushing, Romney surging.

Brian?

MURPHY: It got swallowed up in the news cycle, but we learned in Harrison,
New Jersey, there was a station built that was used with money that was
redirected into Jersey. The governor`s brother, Port Authority
commissioners were both sides of that were involved in profiting off land
deals near it, giving us a road map on how to get to the next story.

KORNACKI: That story, what we are talking about that story tomorrow on the
show. So, good tease there.

And, Bob?

INGLE: And on Monday, we find out how they plan to spend the next $1.5
billion in Sandy funds. And I learned also from you that they needed a
monitor for the monitor of the funds.

KORNACKI: A monitor for the monitor. There`s another contract that could
be getting out of there. The monitor for that monitor, too. Anyway, I
want to thank all of our guests today including Suzy Khimm, Brian Murphy,
and Bob Ingle.

Thanks everybody for getting up this morning. Thank you for tuning in.

Stick around next for Melissa Harris-Perry. She is next.


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