updated 2/24/2014 10:16:29 AM ET 2014-02-24T15:16:29

THE RACHEL MADDOW SHOW
February 21, 2014

Guests: Chad Campbell, Ryan Grim


STEVE KORNACKI, GUEST HOST: Good evening, Chris. Thanks for that.

And thanks to you at staying with us the next hour. Rachel has the
night off.

On November 2nd, 1983, a reluctant President Ronald Reagan created a
new national holiday.

(BEGIN VIDEO CLIP)

TOM BROKAW, NBC NEWS: It`s official now. The dream of his family,
friends and followers was realized today when President Reagan, not an
enthusiastic supporter of the idea, signed a bill declaring the third
Monday in January as a national holiday honoring Martin Luther King Jr.

Chris Wallace was there today in the Rose Garden for the ceremony.

CHRIS WALLACE, REPORTER: There was an air of celebration in the Rose
Garden but also an underlying tension. White House officials wrestled for
days about how to usher in a holiday the president opposed. They finally
decided to embrace it.

RONALD REAGAN, FORMER PRESIDENT: Traces of bigotry still mar America.
So each year on Martin Luther King Day, let us not only recall Dr. King,
but rededicate ourselves to the commandments he believed in and sought to
live every day.

(APPLAUSE)

WALLACE: The president signed the bill creating the holiday, and gave
the pen to King`s widow.

(END VIDEO CLIP)

KORNACKI: That was 1983. Now more than 30 years ago when President
Reagan begrudgingly signed the MLK holiday into law. It`s a bill that took
a lot of public pressure to even get passed, despite it being an
overwhelmingly popular idea.

Dr. King`s widow, Coretta Scott King, she lobbied Congress personally
armed with a petition signed by no less than 6 million people in favor of
the holiday. She and they overcame the initial opposition from the White
House and also a last-minute effort by Senator Jesse Helms to derail it.

But finally, 15 years after the assassination of Dr. King, an official
federal holiday was created to honor him. Then, it was up to the states to
adopt it. Some had already done so even before the federal law passed, but
the pace accelerated once that federal law went into effect. One state
after another putting on the books an official holiday in celebration of
the civil rights hero.

But not every state -- a few cases, legislators balked at the idea of
creating a new holiday. One of those places where it became a seriously
contentious issue, seriously contentious battle was in Arizona. In 1986,
three years after that day in the Rose Garden, the Democratic governor of
Arizona, Bruce Babbitt, on his way out of office signed an executive order
to make Martin Luther King Day a holiday in his state.

The very next year the Republican who was elected to succeed Babbitt,
Evan Mecham, made it his first official act to rescind that executive
order, call off MLK Day in the state of Arizona.

This understandably upset a lot of people. The anger reached new
levels in the fall of 1990 when the King holiday was placed on Arizona`s
ballot and it failed.

And now, there were loud calls for boycotts. Stevie Wonder called for
one until and unless the holiday was approved. Marquee college football
teams began boycotting the state`s preeminent bowl game, the Fiesta Bowl.
The NFL threatened Arizona, unless they passed the MLK holiday into law,
they wouldn`t be able to hold a Super Bowl in that state.

That pressure campaign seemed to work because finally in 1992, a
second referendum was held and this time voters chose to make MLK Day an
official holiday. NFL eventually did hold a Super Bowl in the state, but
it wasn`t until 1996 that it canceled the one that had been scheduled
before voters passed that referendum.

That fight over what most people saw is a moral no brainer left
something of a stain on Arizona even after the holiday became law. The
reputation that Arizona acquired through its resistance to MLK Day was a
little hard to shake, took a long time to live that one down. So in 2010,
when another racialized legislative fight hit national news, some were not
surprised that the epicenter was in Arizona.

(BEGIN VIDEO CLIP)

REPORTER: Protesters turned out at this weekend`s Diamondbacks game,
calling on Major League Baseball to move next year`s all-star game out of
Arizona. This just one sign the whole state is bracing for the start of
Arizona`s tough new immigration law, Senate Bill 1070, scheduled to take
effect Thursday. The law would require police who are making routine stops
to check someone`s immigration status if there is reasonable suspicion to
believe the person may be undocumented.

(END VIDEO CLIP)

KORNACKI: With Senate Bill 1070, which came to be known nationally as
the "papers please" bill, Arizona was once again in the national spotlight
for crafting the nation`s toughest bill targeting undocumented immigrants.
Critics call the bill an invitation for open discrimination. Calling it
racial profiling. President Obama said it, quote, "undermined the basic
notion of fairness."

There was even international outcry against the bill with the Mexican
government expressing its concern for the rights of Mexican citizens in
Arizona. There was so much national attention on the bill, so much
negative national attention that many thought in the final days that
Republican Governor Jan Brewer might not actually sign it into law.

But there you can see, in April of 2010, there she was signing SB-
1070, the harshest immigration bill in the nation, into law.

Protests around the country once again calling for the boycott of
state flourished. There were calls for sports teams not to play in the
state, for anyone not to travel to the state at all. Some projections,
Arizona had lost millions because of the boycotts.

The law was challenged in court and it was partially invalidated by
the Supreme Court two years ago, but it all took a serious toll on the
national image of the state of Arizona.

It may be a little hard to say this, but there does seem to be a
history in Arizona, particular modern history in Arizona that suggests
something of an immunity in the national cultural temperature.

What`s happening right now is only bolstering that feeling, because
the state legislature in Arizona just passed a pretty phenomenally anti-gay
bill couching it as religious freedoms legislation.

The bill allows individuals or businesses to deny services of any kind
to gays if they want to. Language of the bill is so broad that this could
mean that even government employees like police officers could deny
services to gay people.

Amendments to make sure that life-saving emergency treatment and
public safety for gay people could be protected were roundly rejected in
the state legislature today amid what was a very heated debate.

(BEGIN VIDEO CLIPS)

STATE REP. DEMION CLINCO (D), ARIZONA: I believe I`m the only openly
gay member of this House of Representatives, and so it`s pretty appalling
to hear a dialogue that talks about using religion to discriminate against
both myself and my community.

I mean, if this bill passes in my hometown of Tucson, I could walk out
of my home and call a taxicab and they could refuse me service. I could
have a medical incident and somebody comes to my home to provide services,
and I could be refused. That`s not the Arizona that I want to live in.
That`s not the Arizona that the LGBT community wants to live in.

STATE REP. LISA OTONDO (D), ARIZONA: Let me tell you as an Arizonan,
a native of Arizona, a daughter of Arizona, we already took a punch. I
already took a punch in the eye after 1070. And hopefully we`re starting
to recuperate after that. And the last thing I want to be known for, for
my wonderful state, is to be known for more discrimination.

STATE REP. CHAD CAMPBELL (D), ARIZONA: The bottom line is, this is an
attack on the gay community of the state, period. Right now, the gay
community, LGBT community, is not a protected class, so they`re going to be
open to this attack. The protected classes of everything else are not
going to be protected because they have -- are not going to be affected
because they have the protection right now.

But at one point, African-Americans didn`t have the protection. At
one point, women didn`t have the protection. At one point, many, many
different classes did not have protection and that is why we did what we
did to correct those wrongs. This is going to be in the future, we`re
going to look back on this bill and people are going to laugh at this bill.

(END VIDEO CLIPS)

KORNACKI: Arizona is not the only state to float this anti-gay,
religious freedoms bill. Similar legislation has been introduced around
the country. Efforts in Tennessee and Kansas were scrapped just in the
last two weeks because of the national outcry. But it passed in Arizona.
And now, the decision rests with Governor Jan Brewer. She has five days to
make a decision. Who knows what`s going to happen now?

Joining us now is Arizona State Representative Chad Campbell. He`s
the Arizona state house minority leader. He represents Phoenix.

Representative Campbell, I want to thank you for being here tonight.

I guess we`ll start with the million-dollar question. As I understand
it, Governor Brewer vetoed basically the same bill last year, but at the
time she was locked in a fight with the legislature over funding for the
Medicaid expansion under the Affordable Care Act, so it was unclear if she
was really vetoing this bill or if it was just part of a broader effort on
the Affordable Care Act. Do you have a sense -- do you have any indication
from the governor what she`s going to do when this bill reaches her desk?

CAMPBELL: Unfortunately, we don`t, and we`re hoping that she vetoes
it again like she did last year.

Be it on moral grounds, be it on economic grounds. This bill needs to
be vetoed. It is bad for Arizona. It is bad for the people of the state.
And it`s just a bad message we should be sending to the rest of the
country.

We`re basically telling a certain group of people that we don`t want
your kind in our state. We don`t want you to live here, we don`t want you
to do business here, and that`s a horrible message and it`s absolutely
unacceptable.

So, I`m hoping that the governor will veto this bill again.

KORNACKI: You talk about the potential economic consequences. Those
were mentioned in some of those clips we just played. Can you quantify for
us when you look back at SB-1070, what that meant what the boycotts and
protests meant for the state economically? And is there a sense of what
this would mean economically? Can you put a number on that?

CAMPBELL: No. That`s really hard. I mean, we lost numerous
conventions over the years. We lost population. People left this state.

I mean, the quantifiable number for that is I think unimaginable. We
lost businesses, we lost tourism. We`re still recovering from the damage
that SB-1070 did on top of the recession we were already in. And so to now
put this bill into place and put this into perspective, this is kind of
just doing damage to the state on top of the damage Senate Bill 1070 did
and we simply can`t afford it.

Economically, it will be devastating for us. We`re supposed to have
the Super Bowl next year. Who knows what will happen with that.

But, again, it`s not economic reasons. Morally, this is a
reprehensible bill and it`s got to be stopped. The governor has to veto
this bill.

KORNACKI: I wonder, I think, we look at the legislative fight and it
looks like it was pretty much, as I understand it, it was pretty much a
party-line vote, you know, relatively close vote breaking along party
lines. When you get out of the le legislature and the broader population
in Arizona, is there any polling, is there a sense this is 50/50 among
voters, or are voters pretty much overwhelmingly against this? And if
that`s the case, where is this coming from? Where is the drive for this
coming from?

CAMPBELL: Yes. You know, I don`t know if any polling exists on this,
but I can tell you, I`m a native Arizonan and I`ve been here my whole life.
And I do not believe this reflects the values of the majority people in
this state. And this is really coming from a legislature that is very
extreme and that is controlled by the far religious right and in particular
an organization called the Center for Arizona Policy, which is trying to
push its agenda on the people of the state and has been for many years now.

And so, it`s not reflective of the state and reflective of the people
of the state. We have a legislature disconnected from the mass population
in Arizona, has been for quite some time. Senate Bill 1070 reflected that.
We talked about the MLK issue at the opening of the show here.

But the legislature usually ends up having to come back and fix these
problems because they`re forced to by the people of the state, once the
people have recognized what kind of damage that the legislature is doing to
Arizona. I think that`s going to be the case here again if Governor Brewer
doesn`t veto this bill. But, hopefully, again, she`ll veto this bill.

KORNACKI: I don`t mean to beat up too much on Arizona. I do want to
kind of ask the question. I`ll say I like the Arizona Cardinals football
team. I cheer for them. So, I like this state.

But when you look at the MLK stuff in 1990, when you look at sb-1070,
when you look at potentially this becoming law, if you kind of string those
things together, does that say something about the culture of your state?
What message -- does it send a message, you think, when you put the three
things together?

CAMPBELL: Well, I think the problem we have, for the most part,
politically speaking, is the legislature and the maps, the district maps we
have, are mainly decided in the primaries. So, you really have the most
extreme element of the Republican Party winning in almost all of the
legislative districts that are Republican dominated now, and there`s no
moderate voices left in the elected Republican body anymore in the state of
Arizona, with a few exceptions. And that`s been the case for really the
past decade or so.

But I do want to point out, since the mid `90s, the population, the
general voters have passed a lot of progressive measures actually when
given a chance. Be it public financing for campaigns, medical marijuana,
redistricting, independent redistricting, excuse me, minimum wage
increases. The voters have passed very progressive ideals at the ballot
when given a chance. It`s the legislature that is pushing these bad ideas
and really shoving it down the throats of most Arizonans.

KORNACKI: All right. We`ll be keeping a eye on what Jan Brewer
decides to do. She has five days. Arizona State Representative Chad
Campbell, he`s the House minority leader, a Democrat from Phoenix -- we
thank you for your time tonight.

CAMPBELL: Thank you.

KORNACKI: Up next, President Obama plays favorites for his longtime
listeners. We`ll be right back.

(COMMERCIAL BREAK)

KORNACKI: It was late on election night in 2012 when President Obama
took the stage to give his victory speech. Media outlets had declared him
the winner shortly after 11:00 Eastern Time. But the president, as custom
dictates, waited for Mitt Romney`s phone call to concede the race, and then
for Romney`s actual concession speech. So, it was actually well after
midnight when Obama finally spoke to the crowd.

And then, he engaged in the highest profile game of phone tag ever,
because right after the president gave that speech on election night, 2012,
he called two members of Congress. He called the Republican speaker of the
House, John Boehner, and he called the Republican leader in the Senate,
Mitch McConnell. President called them both right after he was done giving
that speech on election night.

But neither one of them picked up the phone. According to "The New
York Times," they were sleeping, which is maybe understandable due to the
late hour, but you also might think that maybe if the president of the
United States calls you right after he wins re-election, you might answer
the phone or maybe the person who answers the phone on your behalf might
know that this is one of those instances when it`s actually OK to disturb
your boss from his sleep. Or maybe that`s just me.

So, whether they were intentional snubs or whether they were innocent
snafus, that pair of failed phone call attempts on election night was
actually a pretty perfect symbol of the relationship between President
Obama and both Boehner and McConnell ever since the 2010 midterm wave that
brought Republicans to power on Capitol Hill.

Think back to the summer of 2011, the first summer after that
Republican takeover when the Tea Party infused GOP majority claimed the
debt ceiling as a bargaining chip.

Obama followed right along seeking to strike a grand bargain before
the catastrophic default deadline. In those negotiations in the summer of
2011, the president put concessions on the table that angered his own
party, that angered Democrats, angered his base -- the ideas of cuts to
Medicare, cuts to Social Security, cuts in discretionary spending.

He put the idea of those concessions on the table because he believed
he was getting somewhere with the GOP, that his willingness to irritate his
base would prompt them to meet him halfway, to irritate their base and to
sign off on revenue increases.

But we can look back now and we can realize that that was never going
to happen. Republicans terrified of being branded sellouts by the Tea
Party crowd wouldn`t back Boehner and Boehner pulled out of those
negotiations at the 11th hour leading to one of the more memorable and
emotional press conferences of Obama`s presidency.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Somebody else asked,
you know, why was I willing to go along with a deal that wasn`t optimal
from my perspective? It was because even if I didn`t think the deal was
perfect, at least it would show that this place is serious, that we`re
willing to take on our responsibilities even when it`s tough. That we`re
willing to step up even when the folks who helped get us elected may
disagree. And, you know, at some point, I think if you want to be a
leader, then you got to lead.

Thank you very much.

(END VIDEO CLIP)

KORNACKI: Now, ultimately a debt default was averted in 2011, but
only of the U.S.` credit rating was downgraded for the first time in
history and only at the cost of a deal that both parties hated for
different reasons. But what really irked Obama`s base is he negotiated it
all over the debt ceiling. Raising it was supposed to be routine, when
decades of bipartisan tradition held that neither party should ever
actually threaten the full faith and credit of the United States.

Quote, "Dispirited liberals fumed over the deal to raise the debt
ceiling that would cut deeply across government, include no new tax revenue
from wealthy Americans. It would not provide any additional stimulus for a
lagging economy."

"It`s a surrender to Republican extortion". That`s how one Democratic
member voted against the deal put it back then.

So, it was back in 2011 that the president negotiated on the debt
ceiling and in the process offered up sacred Democratic programs as
potential concessions. It marked the lowest point of his presidency. His
base was mad. The whole country was mad at the glaring dysfunction of
Washington. In the deal that averted the default ultimately saddled
America with the sequester, the sequester that we`re still living with.

So, it was that experience that began to convince the president that
compromise with the Obama-era Republican Party just might not be possible.
By the time we got to last fall, a year after Obama`s election night phone
calls to Boehner and McConnell went unanswered, it seemed like the
president had learned his lesson. Republican used the threat of a
government shutdown to extract concessions, but this time, Obama and his
party didn`t blink. They waited out the Republicans who went ahead and
shut down the government and then paid dearly in the polls.

Right after the government was re-opened, the White House refused to
negotiate over the debt ceiling. They won that battle last fall, too, just
as they won it again last week. It`s when the White House refused to
negotiate over the credit of the United States and, again, Republicans
caved. That old norm of not negotiating over the debt ceiling it seems may
actually have been restored.

And then came yesterday. It`s when the president sent another signal
about his changed attitude toward compromise with the GOP.

Yesterday, the White House announced in the president`s soon to be
unveiled budget, he will not propose a cut to the cost of living formula
for Social Security benefits. Chained CPI this is called. It`s a cut
that`s very unpopular with the Democratic base.

Now, he`d offered it up in his budget just last year and Republicans
didn`t even nibble. This year, though, he`s not even going to put it out
there. So, no more negotiating over the debt ceiling. No more cuts to
Social Security to meet some elusive grand bargain with Republicans in
Congress.

And, instead, the president spent the evening tonight making the pitch
to governors why they should support raising the minimum wage. On economic
issues and on progressive policies, this is a different president than the
one who negotiated over the debt ceiling and maybe even the one who made
that call to John Boehner and Mitch McConnell on election night.

Is this what we can expect for the rest of his term?

Joining us now is Ryan Grim. He`s Washington bureau chief for the
"Huffington Post."

Ryan, great to see you tonight. Thanks for joining us.

I guess I`ll start with this -- it seemed like President Obama
genuinely honestly believed in the summer of 2011 that he was going to get
somewhere negotiating with the Republicans. Everybody I talked to says
when he put the idea of chained CPI, adjusted Social Security formula, in
his budget last year, that it was just for show. He knew Republicans
weren`t going to go along with it, but he wanted to prove it to the
country. He wanted people to see that.

Was that the plan? And do you think he succeed in doing that?

RYAN GRIM, HUFFINGTON POST: I think he was tired of not getting
credit for being willing to make all the concessions that he was, because
he was -- he was taking all the heat from Democrats who were furious at him
for being willing to cut Medicare, cut Medicaid, cut Social Security, et
cetera. And at the same time, he had all these -- you know, deficit scolds
saying, why won`t the president lead? So I think he was sick of that, so
he put that out there.

But, you know, I don`t quite understand why he ever thought that the
public would accept the bargain like this.

I mean, think about what politicians would be asking people. They
say, OK, look, we`re going to cut your Social Security. We`re going to cut
your Medicare. We`re going to shred the social safety net. But it`s cool
because we`re also going to raise your taxes.

And, you know, we`ve polled this, a number of people have polled this.
People don`t want a grand bargain. None of it is popular.

KORNACKI: None of it`s popular, although it does -- it is, I guess,
worth noting, too, that in the reporting I`ve seen on this, Obama is not
technically taking off the table the idea of chained CPI. He still holds
out the possibility that, hey, if Republicans come back to the table on
revenue, he`s opened to doing this.

You listen to these Republican statements today, you know, you`re sort
of hearing two radically different things from them. You`re hearing on the
one hand, you know, debt threatens the immediate future of the country, how
dare the president walk away, how dare the president not be serious?

On the other hand, you`re not hearing from them on the revenue side.
But if Republicans do somehow change their tune. The president is still
saying he`s open to this, right?

GRIM: Well, sure. But, you know, that`s not gong to happen. You
know, the Republicans have had every single opportunity to accept really
historic concessions that Democrats have never really offered in the past.
And they didn`t take it.

So, there`s no reason to think that they would take it at this point,
and if they did, the president could not move his party in Congress to back
it. In 2011, he could have done it. 2012, he probably still could have
done it.

At this point, Harry Reid wouldn`t bring it to the floor. You know,
they`d have to do it all with Republican votes in the House which they
could never do because the Tea Party is not going to vote for tax
increases. It just -- it just can`t happen for so many different reasons.

KORNACKI: So I guess the question is, then what is left to happen?
Because we`re sitting here in February of 2014, there`s still nearly three
years left in this presidency. The talk I guess is the budget Obama is
going to submit is going to look for $56 billion in new spending. He`s
going to have to take that through offsets, through cutting some money
elsewhere, trying to get new revenue -- good luck with the Republicans.
We`re still stuck with the sequester.

What proactively can Obama do besides say no to deals like this,
besides stare down Republicans in debt ceiling, you know, showdowns? Is
there anything he can do proactively given the divided government reality
of 2014?

GRIM: He can put forward executive orders and try to work on the
conversation, but ironically the deficit has been coming down steadily.
It`s come down by about half since he started. But he doesn`t get credit
for that.

We actually surveyed this and said, do you think that the deficit has
come down or gone up while Obama is president? And overwhelmingly, even
Democrats said we think it`s gone up.

So, he has gotten no political credit, even though he`s taken the
political heat on this. And ultimately what this shows, people don`t
actually care about the deficit. Even when they tell pollsters that their
concern is the deficit, that`s actually a proxy for the economy, because
when you think about deficit, they think about debt.

When you think about debt, people think about China. When they think
about China, they think of the eclipse of the American empire. They think
of America falling behind.

So that`s why deficit and economy are kind of tied together. So, if
you improve the economy, you will see people stop caring about the deficit,
whether it`s going up or down. It`s going down. People don`t even know
it.

KORNACKI: I love the point because I can remember the Reagan years.
Reagan got killed on the deficit his first two years of his presidency when
unemployment was 10 percent. Unemployment dropped precipitously. The
deficit spiked and nobody cared about the deficit.

GRIM: Nobody cared, right. They had a job.

KORNACKI: That`s a great point. Ryan Grim, Washington bureau chief
for the "Huffington Post" -- thanks for joining us tonight.

And still ahead, an exclusive interview with Pat McCrory about North
Carolina`s horrendous coal ash spill. You want to see that. Stay with us.

(COMMERCIAL BREAK)

KORNACKI: This was a week of pretty major document dumps,
particularly in the state of New Jersey where the town of Fort Lee released
thousands of pages of phone records and e-mails and texts concerning the
George Washington Bridge lane closures last September. And the New Jersey
legislature released court filings brought against Bill Stepien and Bridget
Kelly for their refusal to comply with their legislative subpoenas. Rachel
piled up both sets of documents on her desk to show you how many trees were
killed because of the documents released this week.

But it turns out it was all worth it because we is new reporting based
on information found only in these documents and I`m going to explain to
you exactly what it is tomorrow morning at 8:00 a.m. Eastern on MSNBC. How
is that for a tease? I`m going to save all of my bridge-gate talk for
tomorrow. It`s a big show.

So, don`t forget to set your alarms for 8:00 a.m. I will be there as
bright eyed and bushy tailed as I can be on four hours of sleep. Probably
have to break my New Year`s resolution to have caffeine. I`ll be there.

Coming up first, exclusive interview with Pat McCrory answering tough
questions about how his state plan to deal with the thousands of tons of
toxic coal ash that spilled into the Dan River earlier this month. Some
incredible tape and it`s coming up.

(COMMERCIAL BREAK)

KORNACKI: When we left off in Ukraine yesterday, intense street
fighting has broken out in the capital city of Kiev and spread throughout
the country. Anti-government protesters charged police lines in
Independence Square trying to retake lost ground. The police in turn
started firing at demonstrators with high-powered rifles. Wearing helmets
and makeshift body armor, the protesters did their best to hold their
ground dodging bullets as they tried to push forward. By the end of the
night, they had regained the square.

There have been ongoing protests in Ukraine since this past November
when Ukraine`s president decided to quash a trade deal with the European
Union and to align himself with Russia. But yesterday was the most lethal
day of all, putting the total weekly death toll from fighting between
protesters and police at 77. With close to 600 injured. That`s according
to the Ukrainian health ministry. There are other news accounts that put
those numbers much higher.

Today, on the heels of the deadliest day of violence, we have new and
seemingly positive developments to report. Ukraine`s president signed a
compromise deal, a truce of sorts, with opposition leaders earlier today,
negotiated by European and Russian diplomats. This new deal calls for
early presidential elections and diminishes the power of the president and
it further empowers the parliament.

Both European and Russian diplomats reportedly played a critical role
in negotiating the deal over the past two days. Russia actually left the
negotiations this morning without signing the agreement.

Today, members of the Ukrainian parliament took their first steps
toward new reforms after some heated discussions including a small scuffle.
The parliament voted overwhelmingly to return to a previous version of
Ukraine`s Constitution from 2004. One that limits the power of the
president and emboldens that of the parliament.

In a show of strength, they voted overwhelmingly to free the Ukrainian
president`s political rival. Former Prime Minister Yulia Tymoshenko, who`s
been in jail for more than two years. In a 310-54 vote, it`s a veto-proof
vote, members of parliament passed a law paving the way for her release.
Following the vote, legislators chanted, "free Yulia, free Yulia" in unison
and clapping. Hear them.

Outside of parliament, independence square, police forces pulled back
today abandoning their military trucks and crowd control vehicles.
Thousands of people took to the square again holding vigil throughout the
day. And through the night, holding memorials and prayer services for
those who lost their lives in the protests.

Today`s deal marks a possible political end to something that has been
going on for months. But at what cost? Fighting this past week has
completely decimated parts of Ukraine, as you can see here in these before
and after shots. This is how Kiev once looked and this is how it looks
now, barely standing.

These images do not even convey the vast human toll this conflict has
taken. Joining us now is Steve Clemons. He`s editor at large for "The
Atlantic" and MSNBC contributor on global security issues.

Steve, thanks for being here tonight.

So, I mean, I guess the headline tonight is maybe some stability is
returning to Ukraine. Maybe there`s a path forward, a path out of the
bloodshed and in the chaos of this week. I see that Russia did not sign
this deal. I`m wondering if that`s a big deal. If you see any other major
stumbling blocks that are going to keep the stability we`re now talking
about from taking hold.

STEVE CLEMONS, MSNBC CONTRIBUTOR: Well, you`ve framed it beautifully,
Steve. I mean, everything you just laid out that has happened has happened
in 24 hours. I mean, just a testament to where there`s a will, there`s a
way, when people feel desperate and they feel on the edge of a real abyss
that could take a nation into horrific civil war.

Russia could cause mischief. This remains a fragile situation. But
going back to 2004 constitution, releasing Tymoshenko, announcing a
December election, seeing the interior minister voted out of office and
although not verified, reportedly running off to Belarus or somewhere else
-- all of this has happened. And so, that`s a setback for those that want
to create a false choice between Russia and Europe for Ukraine.

But at the same time, Vladimir Putin does not want to see Ukraine torn
up into civil war. He doesn`t want to see Ukrainian economy implode
because there`s there are $40 billion of debt exposure to Russia on this.
And so, they`re trying to find I think broadly a middle ground.

So, while they may not have signed the document, it doesn`t mean that
they want to see Ukraine collapse. That said, they also don`t want to see
flamboyant liberal democracy take over, either.

KORNACKI: So, now, what`s the story and what do you see as the future
of the president, Yanukovych? He sort of aligned himself with Moscow last
fall, set all this in motion. We hear now tonight that he`s left Kiev.

Is it -- is he likely to stay in power when this is over or does he
have to go?

CLEMONS: Well, listen, right now they`ve got a proportional
government deal that has to be put in place within 10 days. They`ll have
elections in December. I think the most important factor is you had a
staggering number of people resign from his party today.

So, in those Rada numbers, the parliamentary numbers you just
reported, that overwhelming support for rolling back the laws that
imprisoned the former very popular prime minister, Yulia Tymoshenko, that
is a sign that his party is largely collapsing every day right now. So,
whether he remains around until December, many people in -- I`ve talked to
many people in Ukraine today who are still extremely saddened and want,
really want justice for those people that they`ve lost that have fallen in
the streets.

And they want to hold him accountable now. They don`t think that just
coming up with a political deal is acceptable because he has to pay for
these crimes that his government enacted in many -- in many eyes in
Ukraine.

KORNACKI: All right. Steve Clemons, editor at large for "The
Atlantic" -- thank you for helping us sort through this tonight.

CLEMONS: Thank you, Steve.

KORNACKI: Ahead, America honors heroes overlooked for far too long.
Stay with us.

(COMMERCIAL BREAK)

KORNACKI: Out of all the news, out of all the stories we`ve seen this
week, if you`re going to head into the weekend thinking about one, if your
life is busy with friends and family and work taking you and you really
only have time to care about one story in the news -- well, this is
probably that one story.

Today, the White House announced that President Obama will award the
Medal of Honor, that`s the highest honor we give in this country, to 24
Army veterans who were previously overlooked during and after their time of
service.

This is the culmination of a 12-year Pentagon review aimed at
correcting discrimination in the selection process and reassessing the
records of soldiers that maybe deserved a higher honor. This list of 24
soldiers that we now know deserved the Medal of Honor but were overlooked,
19 are of African-American, Hispanic or Jewish descent.

The group includes veterans of World War II, Korea and the Vietnam
War. Some will be there in person like Staff Sergeant Melvin Morris, who
is serving as commander of a strike force in Vietnam when he learned part
of his battalion encountered a mine field and was under attack. So, he
organized his troops into an assault team to help their fellow soldiers,
and he went with two men to recover the body of a fallen team commander.

When they were wounded doing that, he helped those men back to the
group and then he charged into the gunfire alone. He destroyed four enemy
positions by himself. He was wounded three times in the process, but, yes,
he did retrieve that fallen soldier and bring him back to the group.

Unfortunately, though, many recipients won`t be there to receive the
award. That includes Master Sergeant Mike Pena. He was 25 and serving
with the infantry in Korea when his unit was attacked. He led the
counterattack and regained position, but they were outnumbered. The enemy
wouldn`t start coming. Pena realized they were running out of ammo and
ordered his unit to fall back.

But Master Sergeant Pena didn`t retreat with them. He stay behind,
manned the machine gun to cover his men. He got them out safely. He held
back enemy forces until early the next morning when his position was
finally overrun. Master Sergeant Mike Pena was killed in action.

These awards of valor come as the result of exhaustive research
between the Army, the Navy, the Air Force and the Marine Corps nearly 900
records were deemed deserving of reassessment. It took more than a decade
to finally put this group of recipients together. Every face you`re seeing
right now is set to receive the country`s highest honor.

But what makes this honor and the work put into it as significant is
what comes with each of these medals. And our country hasn`t always
honored those that defend us in the way they deserve.

(COMMERCIAL BREAK)

KORNACKI: There is some big news to report tonight from the great
state of North Carolina, specifically from North Carolina`s governor,
Republican Pat McCrory.

Pat McCrory took office just over a year ago, at the beginning of 2013
and right now, he`s facing the single biggest crisis of his entire
administration. It`s a crisis that has to do with this -- this is a giant
coal ash spill that contaminated one of North Carolina`s rivers on Super
Bowl Sunday. It`s been spreading ever since.

This toxic soup of coal ash was spill by a power company called Duke
Energy. It`s the company that also happens to be the governor`s former
employer. Before taking office, Pat McCrory worked for Duke Energy for
nearly 30 years. And his personal ties to the company have been the center
of controversy surrounding his administration`s handling of this disaster.

The state didn`t inform residents about the spill until the day after
it happened. Officials at first downplayed the scale of the disaster.
They told residents that the water was safe. And then days later, they had
reversed themselves and said that no, it wasn`t safe.

The state`s handling of this disaster has been sort of a mess. But it
was made even worse for Governor McCrory when "The Associated Press" broke
the news that his administration has over the last year been shielding his
old company Duke Energy from lawsuits filed by local environmental groups.

Pat McCrory`s relationship to Duke Energy has been the focus of local
reporters in North Carolina for weeks now. And today, the governor sat
down with NBC`s Kristen Welker to address the issue nationally.

(BEGIN VIDEO CLIP)

KRISTEN WELKER, NBC NEWS: Governor, what do you say to your critics
who say that it`s a conflict of interest for you to have such close ties
with a company that you`re charged with regulating?

GOV. PAT MCCRORY (R), NORTH CAROLINA: I`m no longer employed with
Duke Energy Company. That employment ceased a number of years ago and the
voters of North Carolina clearly knew of my previous employment.

But my job is governor and has been governor. I`m the first governor
to have a lawsuit against Duke Energy regarding coal ash in our state`s
history.

WELKER: Are you --

MCCRORY: My predecessor and her predecessor and his predecessor never
initiated action that this governor did regardless of my previous
employment. I might add, previous employment. I`m no longer on the
payroll with Duke Energy Company.

WELKER: Are you a shareholder?

MCCRORY: I have a small 401(k) within my old retirement account. I
have a 401(k) with a portion of Duke Energy stock. I have fulfilled all
the obligations of the requirements as governor and where my investments
are.

So, I`ve followed the law and the public knows of my past relationship
with Duke Energy Company. And they also know that that past relationship
has not caused any special treatment to Duke. And I`m the first governor
to ever take legal action against Duke on coal ash pods.

(END VIDEO CLIP)

KORNACKI: Now, on that last point, that his administration has never
provided any special treatment to Duke Energy, it`s not exactly as open and
shut as the governor would suggest there. That very question, in fact, is
now the subject of a federal investigation.

Last week, federal prosecutors in North Carolina sent a subpoena to
North Carolina`s environmental agency and to Duke Energy seeking documents
and testimony from the state and the company about the coal ash spill. The
U.S. attorney`s office described that subpoena as part of, quote, "an
official criminal investigation of a suspected felony." That subpoena went
out at the beginning of last week. Then, this week, we learned of more
subpoenas which seemed to indicate a widening of the Governor McCrory`s
administration.

Federal prosecutors this week sent the McCrory administration a
subpoena seeking information about the state`s regulation about every Duke
Energy coal ash dump in the state, not just the one that spilled earlier
this month. Prosecutors subpoenaed the environmental agency and also 18
staff members at that agency.

What prosecutors are looking for here is very specific. They want to
know if the governor`s environmental agency afforded any special treatment
to the governor`s former employer, Duke Energy. They`re looking for
documents relating to payments received by state employees from Duke
Energy. They`re looking for any items of value that may have been given to
state employees from the company.

These subpoenas were made public shortly after "The A.P." broke that
huge story earlier this month about the McCrory administration stepping and
effectively blocking lawsuit from environmental groups against Duke Energy.

The state essentially quashed those lawsuits by stepping in and
imposing small fines of their own against Duke Energy. What federal
prosecutors are looking into now is why they did that. Was the state
providing special treatment to Duke Energy?

There`d been a flurry of subpoenas that have come out over the last
few weeks. And NBC`s Kristen Welker asked the governor about that today.
Take a look at that.

(BEGIN VIDEO CLIP)

WELKER: I want to ask you about these subpoenas that have been
served. Federal prosecutors have issued several subpoenas including to
some former and past members of your administration. Are you concerned
about what these subpoenas might reveal?

MCCRORY: We`re going to work -- first of all, my administration is
going to work very closely with the U.S. attorney`s office. We`re offering
cooperation in any way.

Each of the people subpoenaed, we did not hire any of them. They were
all with previous administrations.

But we`re going to work in any way we can with the U.S. attorney or
even looking at doing our own internal investigation. If there`s been any
improper activity, it`s not going to be put up with in this administration.

WELKER: I just want to get you on the record on this, Governor, have
you been served a subpoena, or anyone in your office?

MCCRORY: No, I have not been served a subpoena. And no one I have
appointed or no one in my office have been served a subpoena.

WELKER: Are you confident those who received subpoenas have not
received any improper financial --

MCCRORY: We do not know.

WELKER: -- payments from Duke Energy? Being offer leniency?

MCCRORY: Since we`ve been in office for one year, we`ve had no
indications or accusations of that. And so, it was the first we`ve heard -
-

WELKER: Are you at all concerned about what investigation is going to
reveal?

MCCRORY: You know, I believe in ensuring that you find out all the
information necessary to get the facts.

(END VIDEO CLIP)

KORNACKI: So, you can see Governor McCrory did make a little news in
that interview there. He said he`s personally not been subpoenaed nor has
his office. He says that he cannot say for sure that there hasn`t been
wrongdoing here and he said his office might launch its own internal
investigation into what`s gone on.

This has been a fast-moving story. Just today, one of the major
newspapers in the region called on federal prosecutors who examine the
actions of Governor McCrory himself. It`s unclear whether that will
happen, but this story has just sort of blown up around Governor McCrory
just in the last two weeks. So stay tuned.

And that does it for us tonight. Rachel will be back here in this
chair on Monday.

And you can see me in just a few hours after I hopefully get a little
sleep at least on "UP." That is starting at 8:00 a.m. Eastern Time when we
will have new reporting on the George Washington Bridge scandal.

Until then, as Rachel likes to say -- it`s time to go to prison.

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

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