updated 2/26/2014 10:59:26 AM ET 2014-02-26T15:59:26

ALL IN with CHRIS HAYES
February 25, 2014

Guests: Ann Kirkpatrick, Dan Savage, Louise Melling, Lawrence Korb, Josh Fox, John Yarmuth, Calvin Tillman, Jim Hightower

ARI MELBER, GUEST HOST: Good evening from New York. I am Ari Melber.
I`m filling in for Chris Hayes tonight.

And we begin with a story where progressives are on offense this
evening. The plane carrying Governor Jan Brewer touched down in Arizona,
and the conservative governor came home here with a lot of baggage. Her
colleagues in Arizona and around the nation are waiting on her to decide
whether she will sign or veto Arizona`s Senate Bill 1062. Now, that is the
controversial bill that would authorize businesses to discriminate against
gay citizens. Such discrimination is, of course, generally prohibited, but
the bill would create a religious exemption.

Now, it passed out of the Arizona legislature last week as you may
have heard, and it`s sitting on Jan Brewer`s desk. She has until Saturday
morning to make her decision.

But yesterday, Brewer, who was in Washington for a National Governors
Association event, said she`d not yet made up her mind on how she would act
and she implied she needed to get home to give it a close read.

(BEGIN VIDEO CLIP)

GOV. JAN BREWER (R), ARIZONA: I`m going to go home and when I receive
the bill, and I`m going to read it and I`m gong to be briefed. I can
assure you as always, I will do the right thing for the state of Arizona.

(END VIDEO CLIP)

MELBER: Now, look, that might sound reasonable, but it`s not. The
bill that the governor wants to read and to be briefed on is two pages
long. She could read it in the TSA line at the airport with plenty of time
to spare.

And there`s another reason we know Governor Brewer is stalling, not
studying. The legislature sent her an almost identical bill last year,
just two pages, and she actually vetoed that version of the bill because of
actually a separate skirmish with the legislature and that, of course, drew
less national political heat.

This time is different. Brewer`s returning to a state that`s in open
revolt over this bill right now. A lot of the state`s residents and its
politicians and its businesses don`t want this law and they don`t want
Arizona to be defined by it.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: A day after the Arizona legislature passed a
hotly debated religion bill, business leaders across the state are calling
on Governor Jan Brewer to veto the proposed law or risk damaging the
state`s image and its economic recovery.

(END VIDEO CLIP)

MELBER: Opponents now include the Arizona Chamber of Commerce, the
Arizona Super Bowl host committee, Apple, which actually has major
interests in this state, and both Americans Airlines and Marriott.

Now, as local and national businesses are making their voices heard,
politicians, both in and outside of Arizona, are pushing to distance
themselves from the law. Three Republican state senators from Arizona who
voted for the bill are now, actually -- get this -- they`re actually urging
the governor to veto it.

And State Senator Steve Pierce told Chris Hayes last night, it was
just -- you know, it was some sort of crazy mix-up.

(BEGIN VIDEO CLIP)

STATE SEN. STEVE PIERCE (R), ARIZONA: I believe it was going to be
slowed down, wasn`t going to come to the floor as soon as it did. I can
tell you there`s a number of us that we were texting each other madly, do
we go with it, do we not? And so, we made a mistake. That`s about all I
can tell you is we went the wrong way.

(END VIDEO CLIP)

MELBER: Yes. They went the wrong way. And it`s too late to reverse
that because Arizona`s most powerful Republicans want Brewer to fix what
the legislature mixed up.

Senators John McCain and Jeff Flake are, you can see it right here,
now calling for a veto, and the party`s most recent national standard
bearer Mitt Romney as well. That`s because Mitt Romney and John McCain, I
think they now understand what the equality movement has been arguing for
decades.

Discrimination against any of us is discrimination against all of us,
and politicians who invoke religious freedom for discrimination make for
very bad allies. Arizona`s bill is wrong. It`s almost certainly
unconstitutional and it may run into a brick wall this week. We have to
see.

But a similar measure is also winding its way through the Georgia
legislature. We have a federal constitution to protect our rights, but
just like the old saying about politics, most discrimination is still
local.

Governor Brewer can re-read this two-page bill all she wants. But
she`d be better off giving her constitution a read tonight. You know, it`s
longer, but I think it would be worth it.

Now, joining us to talk about this is Congresswoman Ann Kirkpatrick of
Arizona. She previously served in the state legislature and actually she`s
currently facing a challenger, for your congressional seat, from the
Republican speaker of the Arizona House, Andy Tobin.

Thanks for joining us.

And let`s start right there -- tell us about how this is playing out
in your race and what you think Governor Brewer should do tonight.

REP. ANN KIRKPATRICK (D), ARIZONA: Well, there`s no question she
should veto it, Ari. I mean, I`m a native Arizonan. This bill does not
represent who we are.

Arizona is a beautiful, welcoming state. In my district, we have the
Grand Canyon, which brings millions of dollars in revenue, thousands of
jobs. What Arizona needs right now, after being hit so hard in the great
recession, is jobs. Not this.

And so, we`ve got to ask some really hard questions about how this
happened. How did the speaker of the house, Andy Tobin, allow this bill
and why did he ramrod it through the legislature?

MELBER: Is it helping him politically?

KIRKPATRICK: I have no idea. But it`s hurting the state. And as
you`ve heard, we`ve heard from so many businesses. You know, Arizona is
supposed to be hosting the Super Bowl next year. That`s a big deal for us.

And now, the NFL said they`re watching this.

MELBER: To you buy the governor`s argument she needs time, as we
mentioned here in our lead?

KIRKPATRICK: Well, she needs to veto it and she`s got until Saturday,
the sooner the better. Arizona`s already been hurt by this bill, and,
again, it goes back to the lack of leadership in the House of
Representatives and the speaker of the House needs to answer some really
tough questions about why he did this.

MELBER: What do you expect her to do then?

KIRKPATRICK: I have no idea. I really don`t. I`m asking her to veto
it, as well as all of the other businesspeople in Arizona who see that. At
this time, when our economy is fragile and we`re just starting to recover,
we need jobs. That has to be our focus. And we know already that
companies are starting to say, you know, maybe we won`t come to Arizona.

Yesterday, I was talking to chamber leaders in Flagstaff where I live,
and they said they`re already getting e-mails and phone calls and letters
from people who said, we were going to come to Arizona, go to the Grand
Canyon, but, nope, we don`t think we`ll do that anymore.

MELBER: Yes. You know, it`s an interesting point you raise because
this is a tourism story. It is a business story. It`s an economic story.
It starts out, though, first and foremost, I think, as an equality story
and whether this kind of discrimination should be authorized and written
into the law. It`s scary to people we`re still having these kind of
debates now.

Congresswoman, thank you so much for your time tonight.

KIRKPATRICK: Thank you, Ari. Thank you.

MELBER: Appreciate it.

Now, joining us, syndicated columnist Dan Savage, host of "The Savage
Love" podcast, and author of "American Savage: Insights and Fights of
Faith, Sex, Love and Politics."

And Louise Melling, deputy legal director for the ACLU.

Dan Savage, you don`t need a big long question. Tell us what`s on
your mind tonight.

DAN SAVAGE, SYNDICATED COLUMNIST: Well, I think it`s important to
know the law doesn`t actually single out gays and lesbians alone for
discrimination. It is so broadly worded that anyone in Arizona can
discriminate against anyone else in the provision of goods or services or
anything else for basically any reason, so long as they claim that they`re
discriminating because of a sincerely held religious belief.

A Muslim cab driver could refuse to drive home someone from a bar
because his faith disapproves of drinking alcohol. Someone in a grocery
store could refuse to sell groceries to a single parent because she
believes that having children out of wedlock or premarital sex is wrong.

This way lie chaos. It`s really because of Romer v. Evans, which was
a decision overturning Amendment 2 in Colorado that the law can`t be
specifically targeted at one group. It`s really a target on the backs of
everyone.

MELBER: You mentioned that ruling, of course, written by Justice
Kennedy, a 7-2 ruling. Strong ruling from the Supreme Court back all the
way in 1996 against, as you mentioned, a Colorado rule that was trying to
single out gay citizens.

But to your point, I want to read from the ruling because it makes
that point about what you`re calling over breadth there. Justice Kennedy
writes of that rule, "Its sheer breadth is so discontinuous with the
reasons offered for it. The amendment seems inexplicable by anything but
animus toward the class that it affects. It lacks a rational relationship
to legitimate state interests."

Louise, walk us through that. It shouldn`t have to get to the court,
of course, as I was mentioning. And yet from what we can tell, this kind
of rule as Dan mentions would almost certainly be unconstitutional if
enacted.

LOUISE MELLING, DEPUTY LEGAL DIR., ACLU: This absolutely shouldn`t
get to the courts. We`ve heard from business leaders, we`ve heard from
politicians. We`ve heard in polls.

What this bill is, is a license to discriminate. It`s a broad license
as Dan was saying and the governor needs to veto it. It isn`t targeted by
its language at any specific group, but at the end of the day, it is just a
license to discriminate and we`ve said no to that. We`ve said no to that
historically and we need to say no to that again today.

MELBER: Yes. I think, I mean, to be clear for folks who are
wondering, OK, if it isn`t targeted and it`s on the face as they say, the
lawyers say on the face of the bill, why are we talking about it this way?
It`s because of the context.

And, of course, legislative purpose is relevant to that. Relevant as
a legal inquiry and relevant to politics when we know what kind of
basically politicking and gay-baiting has gone on here.

Dan, I want to play as well some sound from Attorney General Eric
Holder on a related issue. Take a listen.

(BEGIN VIDEO CLIP)

ERIC HOLDER, ATTORNEY GENERAL: I believe we must be suspicious of
legal classifications based solely on sexual orientation and we must
endeavor in all of our efforts to uphold and advance the values that once
led our forbearers to declare unequivocally that all are created equal and
entitled to equal opportunity. You know, this bedrock principle is
immutable. It is timeless.

(END VIDEO CLIP)

MELBER: And, Dan, as you know, the attorney general today was
basically giving an address encouraging state attorneys general to use
their judgment not to defend gay marriage bans and he likened that side of
the debate.

Today, the U.S. attorney general, pretty significant, he likened that
to being on the side of segregationists. What did you make of that?

SAVAGE: Well, it`s a tremendously gratifying development to see in
the top law enforcement officer in the United States coming to the defense
of gay and lesbian citizens. To finally be written in to full citizenship
in this country, LGBT people, is, you know, literally not something I
thought I would see in my lifetime.

MELBER: Really.

SAVAGE: And I`m gratified by it and I am thrilled that you`ve seen
attorney generals in Virginia, now New Mexico, refuse to defend their
clearly anti -- unconstitutional anti-gay marriage bans. I do hope that
this catches on and spreads. And marriage equality comes (INAUDIBLE).

There`s one other thing I wanted to note about Arizona and its law,
it`s currently not illegal in Arizona to discriminate against people based
on their sexual orientation. Right now, people can be fired in Arizona or
denied services or thrown out of their apartments for being gay, lesbian,
bi, or transgendered.

And so, this law not only was completely unnecessary, but the vetoing
of this law isn`t going to protect LGBT people in Arizona who are currently
facing anti-queer discrimination.

MELBER: I mean, look, that`s such an important point. You can cast
this as in some ways a hopeful sign because as we`re reporting -- the
incredible united backlash to something bad. It`s a long ways from full
equality under the law and we should mention we reported, I think,
favorably, that Senator McCain has spoken out against this. But it`s not
as if all the Republican senators are onboard with a comparable federal
protection for employees or ENDA. We reported on that. I know Chris Hayes
reported on that. We`re a long ways from that.

So, definitely a mixed ruling.

Syndicated columnist Dave Savage and Louise Melling of the ACLU --
thank you so much for your time tonight you guys.

MELLING: Thank you.

SAVAGE: Thank you.

MELBER: And tomorrow, Chris will have an ALL IN investigation into
the groups and the people that are behind the push to pass these anti-gay
laws across the country under what we think is the guise of religious
freedom. You don`t want to miss that.

And, first, he`s back.

(BEGIN AUDIO CLIP)

DICK CHENEY, FORMER VICE PRESIDENT: I have obviously not been a
strong supporter of Barack Obama, but this really is over the top. It does
enormous long-term damage to our military. They act as though it`s like
highway spending. You know, you turn it on and off.

(END AUDIO CLIP)

MELBER: Dick Cheney speaking out against President Obama over the
Pentagon`s budget, one that Republicans have actually been pushing. That`s
up next.

(COMMERCIAL BREAK)

MELBER: President Obama just formally ordered the Pentagon to make
plans to pull all American troops out of Afghanistan by the end of year.
You heard that right.

Now, the administration had hoped to make an agreement with the Karzai
government that would keep some kind of U.S. military presence in
Afghanistan. But in the absence of a deal, the Department of Defense today
announced it`s moving forward with what it calls a contingency plan that
would actually withdraw all of the remaining troops. There`s about 37,000
there now.

Now, the decision is coming, of course, just one day after the
Pentagon announced plans to scale back military spending partly due to
Republican demands in the sequester. We`re going to have more on all of
that, straight ahead.

(COMMERCIAL BREAK)

(BEGIN AUDIO CLIP)

CHENEY: I think the whole thing is not driven by any change in the
world circumstances, it`s driven by budget considerations. I`d much rather
spend the money on food stamps than he would on a strong military or
support for our troops.

(END AUDIO CLIP)

MELBER: Indeed.

Former Vice President Dick Cheney hopped on the line with FOX News
last night to bash the president over these military spending cuts. What
Dick Cheney said and what he didn`t mention was that these planned cuts are
what amounts to a serious attempt by the White House to reckon with -- yes,
Republican spending priorities.

The proposed cuts were announced by Secretary Hagel yesterday. Now,
he said the cuts would actually be worse if Congress had not agreed to the
Obama administration`s plan to add an extra $26 billion to the Pentagon
budget to prevent some of the more drastic cuts that were called for under
the original 2011 Budget Control Act.

Now, the spending cuts Hagel is proposing is an attempt to deal with
this country`s global foot print, to create new strategic environment where
the U.S. is supposedly more likely to be dealing in surgical operations and
not heavy ground invasions.

Now, since the former vice president chose to compare food stamps and
the defense budget, let`s go ahead and take a look at what`s actually
happening on that front, too. The recently enacted farm bill cut the food
stamp program by $8 billion which means about 850,000 households will lose
$90 in monthly benefits. We`ve reported on that.

And this year, after 47 million people saw their food stamp benefits
reduced because of budget cuts, that`s the context, and yet everyone`s
talking about the military cuts because Secretary Hagel`s proposed Pentagon
budget makes for an easy headline. Like this: "Pentagon plans to shrink
Army to pre-World War II level."

OK. But here`s what some of those cuts actually look like. This is
the context behind these headlines. On the left there, you can see the
military`s current level. In the middle, the proposed level, and on the
right, 1940 levels.

And here are total numbers. So, while it may be sure, technically
accurate, these cuts will bring about the smallest force since before World
War II, the proposed force would still, it would still be far greater than
the troop levels of 1940 and not actually in the big swing of things a huge
reduction from current levels.

Joining us to unpack this further, Larry Korb, a senior fellow at the
Center of American Progress and a man who knows a thing or two about the
Pentagon for serving as assistant secretary of defense under President
Reagan.

Thanks for being with us.

LAWRENCE KORB, CENTER FOR AMERICAN PROGRESS: Nice to be with you.

MELBER: Walk us through this comparison. We see a lot of headlines
about the decline in the force, but we also know we still spend far more
than many other countries combined on our military.

KORB: We spent more than the next 16 nations, biggest spenders in the
world combined. And back in 1940, right before Pearl Harbor, we were the
17th in terms of military spending and the size of the force. So we`re
still way, way ahead.

The Army and the Marines grew to fight the land wars in Iraq and
Afghanistan and after every war, you bring them back down. And what Vice
President Cheney doesn`t mention is two things. When he was secretary of
defense, he actually cut it more than what has been cut under the Budget
Control Act, and this was not Obama`s idea.

In fact, as you mentioned, he`s asking for $26 billion more than the
sequestration allows, and another $100 billion over the next couple of
years, so they can get relief from sequestration. He`s not cutting it.
He`s asking for more than the Congress.

MELBER: Larry, I`m glad you mentioned that. When it comes to Dick
Cheney on these issues, the fact check takes a lot longer than the original
lie. And I`ve got to tell you, I don`t have a high standard for him, but
this was pretty outrageous what he is saying both for, as you mentioned,
the context of military spending and when he was, you know, for it before
he was against it.

Second, the fact that we can`t report it enough, this is all under a
sequester demanded by Republicans in the House. These are their cuts.
Senator Rubio also hypocritically lashing out at the president today when
he wanted these cuts.

And then on the food stamps issue, I`m sorry, with food stamps, as you
know, can be a loaded term. But it`s also something a lot of people use
because they need assistance to feed their families.

And it turns out, Dick Cheney having been a defense secretary,
certainly knows this. It turns out a lot of food stamps go to military
families.

I want to put up a Defense Department review that showed last year
military families more reliant on food stamps in 2013 than any previous
year. Over $100 million in food stamp spending in military grocery stores
there.

So, the former vice president there doubly wrong, number one. There
actually have been food stamp cuts as well. So, even if you take his sort
of cheap attack at face value, it`s wrong.

And number two, what`s wrong with food stamps that are going to help
people in need including our veterans and their families?

KORB: Well, there`s nothing wrong with it. And the other thing,
nondefense discretionary spending has actually grown less under Obama than
defense has. I mean, people forget sequestration applies to everything
else other than entitlements and Obama has proposed basically that the
extra $50 billion he`s asked for will be split between the Pentagon and all
the other agencies.

And, you know, even with the budget this year that, you know, Hagel`s
budget under sequestration, that only brings us back to 2007 levels in real
terms. So, it`s not like even going back to when Dick Cheney was secretary
of defense.

MELBER: No, it`s still post certainly a post-9/11 footing which is a
terminology I know the vice president appreciates.

Before I let you go, real quick, on the foreign policy question, your
reaction to this DOD announcement today regarding Karzai.

KORB: Well, I think it`s a smart move because let me tell you, I
dealt with it, I was part of a team that went over there. He really thinks
we want to stay more than he needs us. And so, I think this is great to
call his bluff and say, OK, if you don`t want us, we`re planning on -- that
will get his attention and particularly the people who will succeed him in
the election.

MELBER: Yes, you know, I don`t want to make light of it, but I can`t
imagine after 12 years why he`d have the impression we may be there for a
very long time. But I do understand some of the complexity regarding the
cat and mouse game there of trying to show him we are serious on a foreign
policy footing.

Really great to hear your thoughts tonight former assistant secretary
of defense, Larry Korb. Thank you.

KORB: Thank you for having me.

MELBER: And up next, did you wonder why Senator Rand Paul suddenly
started talking about Bill Clinton last month?

(BEGIN VIDEO CLIP)

BILL CLINTON, FORMER PRESIDENT: I love Kentucky. You`ve been good to
me. You voted for me twice. You`ve been great to Hillary. I love
Kentucky.

(APPLAUSE)

(END VIDEO CLIP)

MELBER: Wonder no longer, we have some great Southern politics, where
the past is always prologue. Bill Clinton on the campaign trail, that`s up
next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

CLINTON: Politics is not rocket science. It`s either creative
cooperation or constant conflict. It`s either a focus on people or a focus
on keeping yourself in power by keeping people torn up and upset so they
can`t think anymore. When Alison got in this race and I talked about it, I
said, your opponent is a genius at that ladder course. He skated a couple
of elections here doing that.

(END VIDEO CLIP)

MELBER: Former President Bill Clinton was in the great state of
Kentucky today, speaking at a fund-raiser there for Alison Lundergan
Grimes, a Democrat who`s looking to unseat Republican leader Mitch
McConnell.

Now, McConnell is facing perhaps the toughest Senate election of his
career. But that`s not to say he hasn`t had primary problems before. Back
in 2010, there was a race for an open seat in Kentucky left vacant by Jim
Bunning`s retirement. Republican primary that year saw a guy you might
recognize, Rand Paul.

But he wasn`t big Rand Paul at the time and he was the underdog going
up against Kentucky Secretary of State Trey Grayson. Grayson was
McConnell`s main man. He was said to have hand picked Grayson and, of
course, publicly endorsed him.

And then when the election came around, Rand Paul crushed McConnell`s
man, Grayson, at the polls. In other words, Mitch McConnell, who was one
of the most powerful Republicans in Washington, no one argues that, but he
couldn`t carry Trey Grayson to victory in a primary in his home state at
which point, McConnell may have realized something. He had a self-
preservation problem.

So, what did he do? Well, he went out and hired Rand Paul`s adviser,
a guy named Jesse Benton to run his 2014 campaign. He didn`t have the Tea
Party`s troops. He could at least go out and hire their general.

So, now, we have Bill Clinton stumping for Mitch McConnell`s
Democratic opponent, as you saw there, and Mitch McConnell working with
Rand Paul`s guy and suddenly something makes sense here. Rand Paul, who`s
not even up for re-election right now has been going around, you may have
seen this, saying stuff like this about former President Clinton.

(BEGIN VIDEO CLIP)

SEN. RAND PAUL (R), KENTUCKY: He took advantage of a girl that was 20
years old and an intern in his office. There is no excuse for that. And
that is predatory behavior and it should be -- it should be something we
shouldn`t want to associate with people who would take advantage of a young
girl in his office.

This isn`t having an affair. I mean, this isn`t me saying, oh, he`s
had an affair, we shouldn`t talk to him. Someone who take s advantage of a
young girl in their office.

(END VIDEO CLIP)

MELBER: Strong stuff. Maybe Rand Paul is trying to blunt Bill
Clinton`s power as a midterm campaign surrogate. Maybe that`s why he`s
suddenly obsessed with the scandal Clinton did survive, after all, 15 years
ago.

As for McConnell, himself, he`s taking a different approach.

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: We welcome him back.
The last time he ran in 1996, he eked out a narrow victory in Kentucky
while I beat the current governor by 160,000 votes, 10 points.

In 2008, both Bill and Hillary Clinton came to town, including the day
before the election, and I won by 100,000 votes. So I welcome President
Clinton back to Kentucky. Every time he`s come, it`s been really good for
me.

(END VIDEO CLIP)

MELBER: And we welcome another Kentucky native son. Joining us is
one of the other people who spoke at that rally today, Democratic
Congressman John Yarmuth of Kentucky.

Thanks. How are you?

REP. JOHN YARMUTH (D), KENTUCKY: I`m good, Ari. How are you?

MELBER: I`m good.

YARMUTH: OK.

MELBER: I`m not a Kentucky expert. I don`t have a Kentucky accent.

(LAUGHTER)

MELBER: I have heard of the good cop/bad cop routine. I don`t know
if you all do that in Kentucky.

(LAUGHTER)

MELBER: What`s going on here with these two senators?

YARMUTH: Well, I think this is kind of an unholy alliance, if you
will, between Rand Paul and Mitch McConnell.

You know, if -- there was a poll recently in Kentucky among
Republicans. They said, who do you prefer, Rand Paul or Mitch McConnell?
And 59 percent to 27 percent, Republicans prefer Rand Paul. So what Mitch
is trying to do right now, obviously, is to cozy up to Rand Paul as best he
can.

He drove literally 100 miles to Bowling Green, Kentucky, so that Rand
Paul would sign his filing papers. That`s how much Mitch is concerned
about Rand Paul`s stature among Republicans and particularly with Tea Party
-- so I think Rand is out running for president, and I think this Clinton
ploy is really to show the Republican base nationally that he`s willing to
stand up to the Clintons, more so than to really affect the Senate race.

(CROSSTALK)

MELBER: Let me jump in there.

YARMUTH: Sure. Go ahead.

MELBER: There`s no question when it comes to your own race in these
kind of political games, if Senator McConnell wanted Senator Paul to back
off this trip down intern memory lane, they could have that conversation.

YARMUTH: He could.

MELBER: They`re not having it.

So, your point, though, is that it`s not necessarily only about the
local race; it may be a net even thing, but it helps Rand Paul nationally?

YARMUTH: I think this is what Rand`s about. Yes, I think this is
really to show the Republicans throughout the country that he`s willing to
stand up and fight against any Democrats, the most powerful and most
popular Democrats.

I don`t really think it`s about the Senate race. Rand was on Glenn
Beck`s show a couple weeks ago. And they asked him why he endorsed Senator
McConnell. He said, well, he asked me and, well, he was the only person in
the race at the time.

So, I mean, if there was ever a more lukewarm reason for endorsing
Senator McConnell, he gave it. Again, I don`t think there`s really a lot
of love lost. This is an association of kind of expediency between the two
of them.

But, in the final analysis, this is going to be a referendum on Mitch
McConnell. And, after 29 years, I`m convinced the people of Kentucky,
including a lot of Republicans in the commonwealth, have just -- they have
just had enough of him. They`re tired of him. They`re tired of
obstructionism.

MELBER: Yes. Let me jump in again, sir.

YARMUTH: Sure.

MELBER: You mention the idea of a referenda. Grimes, who you were
working out there today out there supporting a fellow Democrat with
President Clinton, as we showed, she`s up by -- within the margin of error
a couple points in these polls.

If you`re going to do straight talk with us tonight, you`re going to
admit that reflects some kind of bonus that`s not necessarily going to hold
steady. Mitt Romney won the state by 23 points. She`s benefiting from the
conservative attacks on Mitch McConnell at this point. Isn`t that right?

YARMUTH: Well, to a certain extent.

But look at it this way, too. I think most people who know about
polling will tell you after 29 years, if an incumbent cannot get past 42 or
43 percent, which Mitch McConnell hasn`t been able to do in the last eight
or nine polls at least, that`s a desperate situation for an incumbent,
because opinions about that person after 29 years are pretty well-
established.

There`s not much he can do. And he`s got this attack from the left --
I mean, from the right. He has a primary opponent, Matt Bevin, who is
causing him some heartache. And he`s -- so he`s kind of in political
quicksand. He can`t really move much.

And, again, when you can`t get even close to 50 percent after that
long as an incumbent, you`re in very, very difficult trouble.

MELBER: Well, you`re a man of Kentucky, from Kentucky, for Kentucky.
And all eyes have been on Kentucky. So, I know it was a busy day for you.

YARMUTH: It was.

MELBER: Appreciate you spending some time with us, Congressman.

YARMUTH: Thanks for having me, Ari.

MELBER: Absolutely.

Now, coming up: The lawyer for the Exxon CEO who didn`t want that
water tower that could be used for fracking in his neighborhood, well,
they`re speaking out.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP, "LATE NIGHT WITH SETH MEYERS")

SETH MEYERS, HOST, "LATE NIGHT WITH SETH MEYERS": Oh, my goodness.
There is a real -- there is a real natural chemistry between you two.

(END VIDEO CLIP)

MELBER: That was just one of the many highlights from last night`s
premiere of "Late Night With Seth Meyers," just five floors above the ALL
IN studio, and it didn`t even capture one of the best things about that
show, this guy.

(BEGIN VIDEO CLIP, "LATE NIGHT WITH SETH MEYERS")

MEYERS: I cannot tell you how happy I am that you`re here.

FRED ARMISEN, ACTOR: I`m so psyched.

MEYERS: It`s so great.

(CHEERING AND APPLAUSE)

MEYERS: He`s the best. You were on "Jimmy Fallon" tonight.

ARMISEN: Yes.

MEYERS: You`re doing this show.

ARMISEN: Yes.

MEYERS: "Portlandia" season four starts this week.

(CHEERING AND APPLAUSE)

ARMISEN: Yes, Thursday, yes.

MEYERS: You have all these projects. And I heard you talking
backstage. And I don`t know if this is true. But is this true that you
were saying to somebody that you have a new show on The History Channel?

ARMISEN: I do. And it`s called recent history. And it only goes
back this past hour or so, but with a historical spin, so you know the
importance of everything. It`s very serious, very dry.

(LAUGHTER)

MEYERS: OK. I have to say, Fred -- I`m going to interrupt you. It
seems like you`re making this up.

(END VIDEO CLIP)

MELBER: A channel devoted to recent history? I like the sound of
that. That`s a cable news joke.

But, no, Fred Armisen does not actually have a new show on The History
Channel, but he will make some ALL IN history tomorrow, night when he sits
down for an exclusive 30 Rock interview with Chris Hayes. Now, what will
they talk about? Well, Chris may ask about Fred`s playlist in that newly
created role as late-night band leader or the comedic inspiration for his
coastal progressive satire, "Portlandia," which of course posed the famous
question you should never ask your liberal waiter: Was the chicken happy?

Now, if you have a favorite "Portlandia" moment, go ahead and tweet
us. I`m @AriMelber, and, of course, @allinwithchris.

Now, before we have too much fun, we do have some other ALL IN news
that you may want to hear.

Last night, you may remember, Chris brought you the story of Exxon CEO
Rex Tillerson and his fight to stop some fracking-related activity near his
home. That`s understandable.

Well, tonight, we have an update. Mr. Tillerson`s lawyers are
responding now to these stories. They`re calling for new some rhetoric in
their legal battle to keep the oil industry`s impacts away from one of its
leaders.

Well, Josh Fox from "Gasland" will join us and make sense of it all
straight ahead.

(COMMERCIAL BREAK)

MELBER: Welcome back.

Last night, we introduced you to Rex Tillerson, the CEO of the biggest
oil company on earth, ExxonMobil. The company is now on the forefront of a
fracking revolution in the U.S., and Mr. Tillerson is leading the charge.

(BEGIN VIDEO CLIP)

REX TILLERSON, CHAIRMAN & CEO, EXXONMOBIL: There has not been a
documented case of substantial or even, I would argue, insignificant
contamination or freshwater as a result of hydraulic fracturing.

Now, what I say to people, you know, is, with a million data points,
over 50 years, if it was a problem, don`t you think we would have figured
that out by now?

(END VIDEO CLIP)

MELBER: Maybe, but it appears Mr. Tillerson will only lead this
fracking revolution as long as it stays far away from his own backyard.

As "The Wall Street Journal" first reported, Tillerson has now joined
a lawsuit, along with his neighbors, to stop the construction of a 160-foot
water tower in Bartonville, Texas. That`s a suburb of Dallas.

Now, the tower is adjacent to Mr. Tillerson`s rather large 83-acre
horse ranch and it could supply water to a nearby fracking site. As you
can see, well, it`s not that pretty. Mr. Tillerson and his neighbors, who
include former House Majority Leader Dick Armey, argue that the water
tower`s unsightly appearance is at odds with their wishes.

Can you blame them? "Each of the homeowners built or purchased their
homes in Bartonville to live in an upscale community free of industrial
properties, tall buildings and other structures that might devalue their
properties and adversely impact the rural lifestyle they sought to enjoy."

And that`s problematic for Tillerson and his neighbors because, as
their lawsuit states, the company that owns the tower could sell water to
oil and gas explorers for fracking shale formations, leading to traffic
with heaving trucks, creating noise nuisances and traffic hazards.

That`s also reasonable-sounding. So, Rex Tillerson is all about
fracking just as long as all the ugly trappings that come along with it,
that are really built into it, are nowhere near his property.

Now, the attorney representing Mr. Tillerson and his neighbors is
trying to distance his clients from scrutiny. Michael Whitten tells "The
Ft. Worth Star-Telegram" that he wishes he`d been more careful drafting the
language in that suit that we have been reporting on. "This is not an
anti-fracking lawsuit. Nothing could be further from the truth."

I want to pause here. That response that you just heard shows they
really still don`t get it. This is not about the technical definition of
fracking. It`s about whether we`re going to have an honest, reality-based
debate about the cost of our energy policies.

And, look, those costs can get pretty ugly, unsightly water towers,
fracking wells, strange smells, and the kind of air and noise pollution
that just about anyone would avoid if they could afford it. That`s what
the Lyssy family lives with. They run an organic farm on the edge of the
Eagle Ford Shale, which is a strip of oil and gas extraction that stretches
from south to eastern Texas.

But the Lyssys, well, no surprise, they don`t have the money or the
lawyers or the connections of ExxonMobil`s CEO, and they have to live with
those costs.

(BEGIN VIDEO CLIP)

AMBER LYSSY, FARMER: It just makes constant noise. They have bright
lights on all night long. And that one was completed last summer. And it
flared nonstop for a year.

UNIDENTIFIED MALE: We`re standing on the road. We own that kind of
the road. This is the neighbor`s, where they`re doing some massive frack
job.

Obviously, you can hear the noise. It`s pretty loud. Sometimes, it
really echoes late at night. But that flame is almost always going. We
don`t feel safe having cattle or anything right here.

(END VIDEO CLIP)

MELBER: There you see the other side of the tracks. And I think
that`s why our debate over environmental justice is also a debate over
social justice, because when you get down to it, even these oil executives
are environmentalists when it comes it their backyard or their oceanfront
views.

Yes, it`s environmentalism for the 1 percent, and the industrial
revolution for everyone else.

Joining us now to explain all this, the former Mayor of Dish, Texas,
Calvin Tillman, who actually left Dish because he feared the effect of
fracking in his town and its impacts on his family. He was also featured
in the documentary "Gasland."

Welcome. Tell us about your experience and any reaction to these
reports.

CALVIN TILLMAN, FORMER MAYOR OF DISH, TEXAS: Well, thank you very
much.

You know, in Dish, we were basically forced from our home because of
the air pollution that was caused by the oil and gas industry. Our
children began getting nosebleeds in the middle of the night, you know,
multiple nights a week, and it basically forced us to move because of the
health of our children.

And so it`s pretty disappointing when the CEO of one of the companies
that do this sort of activity is complaining about something that`s far
less invasive that`s going in his backyard than what his industry put into
our backyard.

And, you know, we were made out to be unreasonable when we spoke out
and some people eventually filed lawsuits of their own against the oil and
gas industry. They acted like we were unreasonable. And yet, you know,
here we got the CEO of one of these companies who`s complaining over a
water tower.

I`m pretty sure the water tower doesn`t cause his children to have
nosebleeds at night.

MELBER: And when you look at some of his responses, at least through
his counsel, do you feel like, quite honestly, he doesn`t get it?

TILLMAN: Absolutely I don`t think he gets it.

And I think that, you know, when I was moving from Dish, I offered
people just like him the opportunity to come and live in Dish, and none of
them took me up on that opportunity. You know, what I wanted is, I wanted
them to bring their children to live in the same environment that they were
forcing me and the people of Dish, Texas, to live in.

MELBER: You know, you say that. It`s interesting. A lot of writing
and political organizing works around that idea. I mean, there`s that
famous book "Nickel and Dimed," where writer Barbara Ehrenreich tried to
live at the poverty line and tried to share with people what`s that like.

As we have reported on MSNBC, there`s some legislators in certain
states trying to do that on the minimum wage to make the argument that it`s
hard to live on the minimum wage. And you`re talking about arguably
something that, from a health perspective, can be even more dire.

What does it take to, do you think, you think wake up sort of the
elites, the businesspeople who are doing this and the political elites to
what you`re talking about?

TILLMAN: Well, I think that you`re seeing some of it now. You`re
seeing what they really believe.

They don`t believe that they should have to deal with the same pain
and suffering that they`re dishing out to other people. And so they need
to come and they need to feel some of the pain and they need to see the
damage that they`re doing. And they need to feel that up close, because
until they do that, they`re just going to keep living in their high-end
homes and their elite neighborhoods, where the activities that they`re
getting rich on can`t happen.

MELBER: Yes.

And let me read to you a statement from Exxon. We, of course, have
been tracking their views of this. And they have said two things. One,
they have said that Mr. Tillerson`s home issue is a private matter. And
then, two, more broadly, they have said, look: "The safety of people,
communities and the environment is the top priority for all responsible
companies and authorities working to develop unconventional gas resources"
-- end quote.

What do you say to that, their argument that there is basically energy
demand for this and they try to do it safely?

TILLMAN: Well, unfortunately, I have heard that story for about the
last 10 years, and I have yet to see an instance where they were doing it
safely and responsibly and respectfully.

And, you know, this is personal to me, too, when I`m run out of my
dream home, you know, to save the health of my children, so I don`t have to
worry about what they may have or get somewhere down the line. And so this
is personal to me, too. And so I just don`t give anything that he says any
credibility, because I have had to live in what he is saying is responsible
and respectful. And it`s not.

This industry is not being responsible and respectful. They are
running over people. The minute that you question them, they start to
threaten you. And then they try to attack your character and everything
else if you speak out against them.

And so they`re not the industry that Mr. Tillerson wants to purport
them to be.

MELBER: Yes.

TILLMAN: They`re completely the opposite.

MELBER: Yes. I mean, I have got to tell you, Calvin, I appreciate
you speaking out. In some sense, from your own arguments and what you have
shared, it`s too late for your particular home.

And yet you have made this a cause that you want to share. And I know
that`s why Josh put you in the feature. It`s why Chris Hayes has continued
to report on these issues, at least for the sake of other people, if not
your own history.

So, Calvin Tillman, appreciate your time tonight.

TILLMAN: All right. Thank you very much.

I do want to point out that just about 10 miles up the road from Mr.
Tillerson`s horse ranch, in the city of Denton, Texas, currently, they`re
doing a referendum to ban fracking in the inside of the city limits. And
this is, you know, basically in the heart of drilling country. They`re
attempting to put a referendum up to ban drilling in Denton, Texas.

MELBER: Yes. And that`s a story we will also continue to keep our
eye on.

Calvin, thank you for your time.

And this isn`t just in Texas, folks. It`s across the country. We`re
going to look at the cost of fracking to all of us. That`s up next.

(COMMERCIAL BREAK)

MELBER: Joining us now from Austin, Texas, Jim Hightower, the former
Texas agriculture commission, current editor and publisher of "The
Hightower Lowdown" and of course the author of "Swim Against the Current:
Even a Dead Fish Can Go With the Flow." Great title. And here in New
York, Josh Fox, who we mentioned, director and producer of "Gasland" and
"Gasland 2."

Thank you both for being here.

I want to start with you, having reported on this extensively, Josh.
Your thoughts and your thoughts on this...

(CROSSTALK)

JOSH FOX, DIRECTOR, "GASLAND": Well, from the perspective of
listening to Calvin Tillman, I mean, you know things are bad when the mayor
moves out of town. You know things are bad when the CEO of ExxonMobil, the
number one natural gas producer in the United States, is suing to stop
critical fracking infrastructure from in his own backyard.

And I just want to respond to his lawyers by holding up the lawsuit
where it says quite clearly here, `Water to oil and gas explorers for
fracking shale formations leading to traffic with heavy trucks, creating a
noise nuisance." They also talk about light pollution. This is clearly
about fracking. And they`re in the business of denial.

MELBER: Right. It`s in the brief. It`s in their statements.

(CROSSTALK)

MELBER: Jim Hightower -- I`m going to bring in Jim.

Josh brought show and tell. Jim, what did you bring?

JIM HIGHTOWER, FORMER TEXAS AGRICULTURE COMMISSIONER: Well, what we
have here is a case of phallic justice, if you look at that tower, the 160-
foot tower that Tillerson is complaining about.

Here`s a guy who got $40 million last year in payment, in part, large
part, for running around the country and fracking other people`s lives.
And now he`s in a big pout and a big whine because it`s happening to him.

I was with some people from Denton County last night, where this --
where Tillerson`s 83-acre little horse farm -- that doesn`t count his 18-
acre personal home nearby. And they`re calling it Rex Tillerson`s last
direction out there in this thing.

People are laughing at this goon. But, of course, it`s not funny,
because it`s running roughshod over just workaday people in this country.
And, you know, some of these guys are getting so rich, they could afford to
air-condition hell. And I will tell you what, Ari. They better be setting
some money aside for that project, I think.

MELBER: Well, Josh, your response?

FOX: Well, the ultimate irony here is that, actually, we don`t need
to be fracking these places at all.

This is a huge campaign to install two million more new wells onshore
in the United States of America, when, in fact, that means there`s a
paradigm shift in energy development. What we need is a paradigm shift in
energy development towards renewable energy.

And it`s actually possible to have 100 percent renewable energy. I
volunteer time with an organization called The Solutions Project, which is
thesolutionsproject.org. And they`re mapping out how we get to 100 percent
renewable energy. Just parking lots and buildings in New York alone could
-- when solarized, could provide more than we need for all of our
electricity generation in New York State, for example.

So, what this is about is, they`re for their profits. And when it`s
not coming into their backyard...

(CROSSTALK)

MELBER: Briefly, you heard Exxon basically say, well, this is a
private matter.

But do you think this does affect them as a company?

FOX: How could this be private? We`re talking about 15 million
Americans who live within one mile of a fracking well.

We`re talking about hundreds of thousands of people in a movement
against fracking in the United States of America, with thousands upon
thousands of stories like Mayor Tillman. This is happening in public
space. This is our air. This is our water. This is our public health.
This is our land.

This is ultimately our democracy, because when we`re talking about the
future of energy development, we`re at a precipice here. Either we can
frack the United States or move in a sane direction. And what Mr.
Tillerson has exposed here is, this absolute blatant and dastardly
hypocrisy of his -- ExxonMobil, the biggest oil company, I believe, on the
planet Earth.

And, certainly, this is an industry-wide practice. Deny what people
are saying about what they`re doing in their own backyards.

(CROSSTALK)

MELBER: Right.

And that`s -- I think that`s a question for him, is, if all politics
is personal, as some say, how does he try to disentangle himself and his
company and his corporate interests?

We did run out of time, but I appreciate your time, Josh, and Jim
Hightower, former Texas agricultural commissioner, and Josh Fox, director
and producer of "Gasland." Thank you so much.

Now, that`s it for ALL IN this evening. I`m Ari Melber, in for Chris
Hayes. You can always find me on Twitter @AriMelber.

And Chris will be back here tomorrow night. Stay tuned for that.

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

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