updated 8/1/2014 9:35:18 AM ET 2014-08-01T13:35:18

THE RACHEL MADDOW SHOW
July 31, 2014

Guest: Mark Mazzetti, Blake Zeff

STEVE KORNACKI, GUEST HOST: I`m good, Chris. Thanks for that.

And thanks to you at home for joining us for the hour. Rachel has
the night off.

We`ve had been unexpectedly dramatic day today on Capitol Hill.
There`s lots to report.

And we begin with these five lonely microphones waiting by a potted
fern in a congressional corridor. They`re not waiting for the potted fern
to talk. This is what is known in reporter land as a stakeout. Reporters
today were gathered around waiting for House Republicans to break from
their meeting and to say something, and in particular, they were waiting
for Republican House Speaker John Boehner to say something, because today
was a big day for John Boehner.

Members of Congress, of course, don`t spend all that many official
days in session anymore as you can see from their calendar. After today,
they had no work days at all scheduled for month of August. So, lawmakers
who aren`t running for president go home and tell their constituents how
much they accomplished in the Capitol for the last year and two. With the
midterm elections in November, Boehner`s plans was to send his members home
for the summer break equipped to tell everyone that they had taken action,
that they had taken real action on the crisis of unaccompanied kids
crossing into the United States.

President Obama had asked Congress for $3.7 billion to help deal with
this genuine crisis at the border. Boehner and his fellow Republicans cut
that back by 80 percent. Most of the money they were authorizing going for
border enforcement.

And their plan was to vote on that today, to pass that and then to be
able to say, "See? We did something. We led."

And they thought they were ready to do it. Republican leaders in the
House spent the past few days whipping through votes making sure they had
the 218 they were going to need to pass that border bill. They even threw
in another separate bill that would block President Obama from using
executive orders like the one that he used in 2012 to defer deportations
for people who were brought to this country as children, the so-called
DREAMers. That is an executive order that has driven the right nuts these
past few years.

So, Republican leaders figured this was the perfect way to get the
base on board with their bill. They were going to let every Republican
House member go on record against President Obama`s executive actions.

Republican leaders sold this whole package to their rank and file
members as something that they could do. Something they could brag about.
Anyone back home who looked at that crisis on the border and asked
Republican members what they were doing about it, they would be able to
say, here, this is what we did about it.

Just before those two bills were going to get their vote today,
Boehner accused the president of not doing anything. He said that it was
time for Congress, and by Congress he meant the Republican Congress, to
act.

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: Well, in my view,
doing something is better than doing nothing. The crisis on the border is
going to continue until the president acts, but he`s clearly not going to
act. That means the Congress has to act. And so, I believe it`s important
for us to act and I`m hopeful that we will.

(END VIDEO CLIP)

KORNACKI: Now, in congressional terms, Boehner`s sense of optimism
lasted for approximately 15 minutes, because instead of going ahead and
voting on their own Republican border bill, House Republicans instead
balked. They spiked their own bill, because even though they watered down
President Obama`s funding request by 80 percent, even though they`d written
in language to make it easier to send the kids at the border back to their
home country, even though they tacked on the second separate bill aimed at
stopping President Obama from taking more executive actions -- even though
they did all of that, it still wasn`t enough for the Tea Party right.

Quote, "House Republican leaders pulled Speaker Boehner`s slimmed
down legislation rather than see it defeated."

Quote, "With more than 20 House conservatives opposed, Boehner did
not have enough votes for his own Republican ranks."

Boehner started the day saying he would hold two votes on
immigration. Those two votes never happened. Instead, he convened an
emergency meeting of House Republicans this afternoon. Reporters set up
the microphones in the hall by that potted fern and they waited and they
waited.

And, finally, John Boehner appeared, but he didn`t stop to talk.

(BEGIN VIDEO CLIP)

REPORTER: Mr. Speaker, what`s the plan, please?

BOEHNER: Working with our members.

REPORTER: Continue into the night?

BOEHNER: Oh, yes.

REPORTER: Back tomorrow?

REPORTER: That was it, huh?

(LAUGHTER)

(END VIDEO CLIP)

KORNACKI: And it`s not hard to see why Boehner didn`t feel like
analyzing in public what had just happened to him and his party. He had
just bent over backward to make his border bill palatable to the Tea Party
right.

He`d watered it down so much, watered down so much of what Obama was
asking for. He added in so much red meat for the right and he did it all
so every Republican in the House would be able to look voters in the eye
and say they had done something. House Republican leaders did everything
but sprinkle sugar on top of this bill.

And also, by the way, the whole thing was never anything more than
symbolic, anyway, because by the time Boehner was done dressing up the bill
for the Tea Party, he`d become totally and completely unacceptable to
Democrats and that meant it was dead on arrival in the Democratic-
controlled Senate. Democrats there were never going to take up this bill.

And still, despite all of this, a bunch of conservative House members
looked at Boehner and they said, no. This was a totally symbolic bill
crafted explicitly to appease the Tea Party. And the Tea Party still said
no.

So, as this was all playing out this afternoon, Republicans faced a
wave of reports about what exactly had gone wrong. "Daily Beast" reporter
Tim Mack said that Boehner told his members they were, quote, "not even
close to having the 218 votes that they needed." Lots of finger pointed at
Tea Party Senator Ted Cruz no encouraged House Republicans to defy Boehner
and force the government shutdown last fall and who many believe stoked
another rebellion here. Although Cruz tonight apparently denied that to
Robert Costa of "The Washington Post."

Chad Pergram of FOX News suggested maybe Alabama Senator Jeff
Sessions could shoot away support for House members in his state, and
Mississippi.

But Alabama Congressman Spencer Bachus said, no way that Jeff
Sessions telling him what to do on this.

(BEGIN VIDEO CLIP)

REP. SPENCER BACHUS (R), ALABAMA: We can`t worry about what one
senator wants, even if it`s -- I have great respect for Jeff. He`s my
senator. But I don`t tell Jeff how to vote. He doesn`t tell me how.

REPORTER: Do you think that --

(END VIDEO CLIP)

KORNACKI: Dave Weigel of "Slate" said the problem for Speaker
Boehner is that Tea Party Republicans figured out that voters right now are
going to blame President Obama for the border crisis pretty much no matter
what happens. Quote, "This makes it hard for John Boehner, Kevin McCarthy,
et al, to convince their flock that they`ll be blamed for any of it."

And there were signs today that some factions of the Republican Party
do think they could face political consequences for doing nothing on this.
Boehner and the GOP`s new whip, Kevin McCarthy, found themselves surrounded
on the House floor by moderate Republicans today. Quote, "Demanding that
they not leave town without voting on immigration."

But when the Republican leadership held that emergency meeting this
afternoon to discuss it, they actually had to call back some House members
who`d already begun heading home. Florida Congresswoman Ileana Ros-
Lehtinen at the airport waiting for her flight. She told "The Washington
Post," quote, "I was upgraded because of my miles. I was so close."

In a way, what happened to John Boehner today is a surprise, a
ghastly political shock. House speakers are supposed to be able to control
their own parties. They`re supposed to be able to pass their own party`s
legislation. That`s an expectation that comes with being speaker of the
House. The House speaker is in charge.

But in another way, what happened today wasn`t a surprise at all,
because since Republicans won back control of the House in 2010, we have
seen time and time again, when it comes to John Boehner and this version of
the Republican Party, all of those usual expectations about the power of
the House Speaker go right out the window over and over again. In one
high-profile humiliation after another, Boehner and his leadership team
have been rebuffed by the hardcore Tea Party right.

In 2011, Tea Party Republicans forced Boehner to walk away from a
grand bargain with President Obama on the deficit. Boehner then had to
bail on his first bill to raise the debt ceiling. Then he had to bail on a
second bill. That`s back to back bailing.

He also bailed on a bill to extend the payroll tax cuts. And the
next year in 2012, Speaker Boehner had to give up on a transportation bill,
and a farm bill, and a budget bill.

In 2013, that`s last year, Boehner gave up on a bill that would have
fixed a flaw in Obamacare because the way the Tea Party sees it, fixing
that law is the same thing as accepting that law. Boehner pulled another
farm bill last year, followed by a combination bill to fund transportation,
also to fund housing.

Some of the stuff involves the basic mechanics of governing. Keeping
the government open. Keeping the roads paved. But under John Boehner,
Republicans all too off haven`t been able to get the most basic jobs done.

Boehner and the outgoing Majority Leader Eric Cantor haven`t been
able to overcome the entrenched elements of their base that are animated by
opposition to President Obama. A big chunk of the Republican base wants
nothing to do with Obama, nothing to do with reforming immigration, nothing
to do with even the faintest whiff of the concept of compromise.

And anything, Boehner and Cantor tried that even starts to touch on
one of those areas, is to this hardcore base a betrayal. Today, of course,
was Eric Cantor`s last day as majority leader. He got skunked in his
primary back home last month and so, he`s on his way out of Congress.

Cantor gave a farewell address this morning on the House floor. He
got some great applause for it. Republicans posted a nice video tribute to
him on YouTube for posterity`s sake. He handed over the Twitter account to
Kevin McCarthy.

And to be honest about it, he really didn`t look that sad to be
leaving. Maybe that`s because now, he can plot a lucrative future as a
lobbyist if he wants to do that. Or maybe, whatever he does next, he won`t
have to worry about this mess anymore.

His final day ended with yet another flameout for the Republican
leadership as they tried to move forward and blocked yet again by their own
membership. It`s hard to imagine a more fitting going away present for
Eric Cantor and it also comes with a very special bow, because instead of
going on vacation starting tonight, like they planned, House Republicans
have now scheduled a new day of work. They are now going to meet in the
morning at 9:00 a.m. to work on their border bill again. And they say this
time, they are not going to leave for home until they hold a vote.

Joining us now is Eugene Robinson. He`s the Pulitzer Prize-winning
columnist for "The Washington Post."

Gene, thanks for being here in the studio tonight.

I mean, the way we ended it there, really, it seems fitting to me,
they come to the summer break, and the second year of this Congress, you
know, we started -- last year around this time we were talking about a
bipartisan comprehensive immigration reform bill, making it out of the
Senate. Maybe it would have a chance in the House, maybe something would
get done. And now, here we are a year later -- forget immigration reform -
- a real crisis at the border. And you can`t even get a vote in the House
on a symbolic bill.

EUGENE ROBINSON, THE WASHINGTON POST: No, you can`t even get a vote.
And everybody -- they`re pointing fingers and saying it`s a huge crisis,
but they won`t do anything about it.

My favorite part of this whole story, this whole day, is that the
Republican leadership came out with the statement saying that, well, you
know, there are plenty of executive actions that President Obama can take
to solve the border crisis. Right?

Well, they`re suing him for taking executive action.

KORNACKI: And they also wanted to pass this second bill today.

ROBINSON: Exactly.

KORNACKI: That`s the one they could have passed.

ROBINSON: So, they don`t want him to take executive actions but they
demand that he`d take executive actions. It`s just insane.

KORNACKI: So, what do you make of this? That quote we used from
Dave Weigel from "Slate," from his article, it really struck me. He`s
basically saying that the base of the Republican Party looked at John
Boehner. Boehner was saying, look, guys, you`re going home. You have a
crisis at the border. Everybody wants to know what you`re doing about it.
This isn`t going to pass the Senate. Obama will never sign it but we`re
going to pass it so we did it.

And they made a calculation -- Weigel is saying that, hey, if we did
nothing, Obama is the president, he`s the one voters are going to blame.
What do you make of that logic?

ROBINSON: Well, you know, politicians always try to figure out who`s
going to get the blame for what, right? I think it`s doubtful that this is
a correct calculation. You know, what generally happens is that everybody
gets the blame, but if they think they`re going to get off scot-free, for
what is still perceived as a crisis on the border, I think that`s crazy. I
think they will get at least some of the blame. Who gets more of it or
less of it, I don`t know.

Frankly, the voters who elect a lot of these Republican members of
Congress don`t like President Obama anyhow. So they blame him for
everything.

But I have a feeling this is the not going to raise these Republican
congressmen in their estimation.

KORNACKI: It gets to I think the bigger question and really almost
the defining question of the last, you know, three or four years now.
Since we`ve had divided government. We saw for the first two years of the
Obama presidency, Democrats had big majorities in the House and Senate and
were able to do really big thing. Since 2011 -- I mean, really, we`ve
gotten to a point where doing nothing, literally nothing is the rule.

And if Democrats aren`t able to take back the House this year, and it
doesn`t look like they`re going to be able to.

ROBINSON: Yes.

KORNACKI: We`re going to have divided government again.

What is it going to take to break out of this cycle?

ROBINSON: I have absolutely no idea. If I do, I would tell you.
And, look, I think the question going forward is, is this an aberration?

Because in the past, there have been times of divided government.
They have been really contentious. Things have looked gummed up but in the
end, some really important stuff has gotten done during those periods.

So, is this just a moment of utter craziness? Because of the Tea
Party, because of the way people perceive Obama? Whatever the reason.

And that at some point, we might go back to the way things were. Or
is this the new normal? Is this the way -- is the country so sort of
polarized that divided government from here, from now on is not going to
mean more difficult to do anything big? Is it going to mean not doing
anything?

KORNACKI: That`s my worry, is that you wind up in a situation with
just totally different universes and nothing happens and people in this
universe say it`s the people in this universe. And the people in this
universe say, it`s the people in that universe. It actually ends up
suiting both sides to do nothing. I`m worried about that as a long-term
trend.

ROBINSON: Yes, because as a long-term strategy for running a
country, that`s a really, really bad plan, right, to, like, never do
anything. You know, infrastructure -- at some point, we`re going to have
to fund infrastructure for improvements in this country. Or bridges are
going to fall down and roads are going to crumble and businesses are going
to go elsewhere.

You know, Lord knows we`re going to have to do immigration reform.
We`re going to have to do big things and we`re going to have find a way to
do it. I`d be lying if I said I was optimistic or saw a way these things
are going to get done in the short or medium term. I don`t see it.

KORNACKI: I think --you`re not the only one crossing your head. In
the 2012 election, we said, well, now the Republicans get the message, on
immigration, if nothing else. I don`t think we expected in 2014 we`d be
sitting here.

Anyway, Eugene Robinson, columnist for "The Washington Post", thanks
for being with us tonight. Really appreciate that.

And lots more ahead, including the CIA actually making an apology.

And later, another installment of Debunktion Junction, the dubious
adventures of Scott Brown.

Stay with us.

(COMMERCIAL BREAK)

HAYES: So, we have some breaking news at this hour. We`ve been
talking about the gridlock in Washington. But there is news for a
bipartisan breakthrough. The Senate and the House have been going back and
forth all summer about funding of the Highway Trust Fund.

And an agreement has apparently been reached. The Senate has agreed
to a House version of a bill that would add $11 billion of money from the
general fund to fund highways through next May, $11 billion. A version
that was passed by the House. Democrats in the Senate have apparently
agreed to this, accepted that deal.

And the issue of funding of the highways will be resolved at least
through next May with an infusion of $11 billion. That`s breaking news
tonight. Something actually happening in Washington.

Be back right after this.

(COMMERCIAL BREAK)

KORNACKI: Every day in the course of covering the news, we get
updates from news service like "The Associated Press" and "Reuters".
Sometimes these updates, which scroll by on our computers, even flash red.
They make a piercing alert noise. And that red alert and that noise means
there`s breaking news somewhere in the world.

And yesterday, in the middle of the afternoon, we got one of those
alerts. "Breaking", it said. "White House document: Secretary of state at
first not told of post-9/11 CIA interrogation methods."

So, OK, there wasn`t a lot of information there in that breaking
news. It seemed like "The Associated Press" had a document from the White
House referring to the time when Colin Powell was George W. Bush`s
secretary of state and how he apparently didn`t know about the CIA`s
enhanced interrogation tactics.

So, that was a little tease that came our way yesterday afternoon.
And then a few hours later, the "AP" filled in the details and turns out
breaking news was coming from a document the White House had e-mailed
accidentally to an "Associated Press" reporter. The White House had sent
to the "AP" talking points about the greatly anticipated but not yet
released Senate report on the CIA`s detention and interrogation program
under the Bush administration.

And that report, which the Senate Intelligence Committee has been
working on for more than five years which covers more than 6,000 pages.
That report is said to cover some very uncomfortable and potentially very
damning details about the CIA`s harsh interrogation methods. Agency
subjected prisoners to waterboarding and other forms of torture and
reportedly misled the Bush administration and Congress about what they were
doing.

And on top of that, on top of that damaging discovery, it was also
learned apparently that in the midst of the investigation, Senate staffers
noticed some of the CIA documents under review were mysteriously going
missing. The evidence suggested the CIA had been taking back documents
that the committee had already seen. The CIA was potentially spying on the
committee`s investigation.

If that were true, if that were true, it would be kind of a huge deal
-- almost an end of the republic type of big deal. Congress has the job of
overseeing powerful government agencies, specifically the Senate
Intelligence Committee is charged with overseeing the CIA. So, if the CIA
were, in fact, spying on Senate committee that was charged with keeping the
CIA in check, well, that would be a huge deal. That would be a very bad
thing.

In March, the head of the Senate Intelligence Committee, Senator
Dianne Feinstein of California, gave a 40-minute speech on the floor of the
Senate in which he flat-out accused the CIA of spying illegally on
Congress, saying she had sent a letter to the head of the CIA informing
them as much.

(BEGIN VIDEO CLIP)

SEN. DIANNE FEINSTEIN (D-CA), INTELLIGENCE CMTE CHAIR: I have grave
concerns that the CIA`s search may well have violated the separation of
powers principles embodied in the United States Constitution, including the
speech and debate clause. It may have undermined the constitutional
framework essential to effective congressional oversight of intelligence
activities or any other government function.

(END VIDEO CLIP)

KORNACKI: That was Senator Dianne Feinstein in March, accusing the
CIA of breaching the separation of powers by illegally spying on Congress.
Among the most serious accusations that can be leveled and that very same
day, CIA Director John Brennan, speaking with NBC`s Andrea Mitchell at the
Council of Foreign Relations, directly denied the whole thing.

(BEGIN VIDEO CLIP)

JOHN BRENNAN, CIA DIRECTOR: As far as the allegations of, you know,
CIA hacking into, you know, Senate computers, nothing can be further from
the truth. We wouldn`t do that. I mean, that`s -- that`s just beyond the,
you know, scope of reason.

hen the facts come out on this, I think a lot of people who are
claiming that there has been this tremendous sort of spying and monitoring
and hacking will be proved wrong.

(END VIDEO CLIP)

KORNACKI: Well, now flash forward to today, because today was not a
great day for CIA Director John Brennan, because today an internal CIA
review admitted that, yes, in fact, the agency had been spying on Congress.
The CIA had created a fake online identity to hack into congressional
staffers` computers and had tried to cover their tracks as they were
monitoring the committee`s investigation. And that meant CIA Director John
Brennan who had said directly, who had said publicly that the very idea of
the CIA snooping on Congress was, quote, "beyond the scope of reason".
John Brennan who said that had to go and apologize to Senator Dianne
Feinstein and to the committee for his agency`s actions.

And that may not be the end of it. The CIA said today they were
setting up their own, quote, "accountability board", that may recommend
disciplinary measures. All this in the actual report about the CIA`s harsh
interrogation tactics is still to be released.

Well, joining us now is Mark Mazzetti. He`s a national security
correspondent of "The New York Times." He`s the author of "The Way of the
Knife: CIA, A Secret Army, And A War at the Ends of the Earth."

Mark, thanks for joining me tonight.

So, let`s just start with that, denial that John Brennan issued back
in March. He said the idea of what Dianne Feinstein was mentioning was,
quote, "beyond the scope of reason." We now know it was not beyond the
scope of reason. And I guess the question is, is that John Brennan being
out of the loop and genuinely not thinking that was happening, or is that
John Brennan being deceptive?

MARK MAZZETTI, THE NEW YORK TIMES: I think it was John Brennan
taking the most outrageous accusations, denying them, but not getting to
the core of what Feinstein had been talking about, which that there was
penetration of computer network use by the intelligence committee.

And as we found out today, the CIA`s own inspector general confirmed
that that had happened and the details that started to trickle out later in
the day were pretty striking. You had a group of CIA officers who read the
e-mails of the Senate Intelligence Committee, they tried to cover their
tracks and they sent a referral to the Justice Department, say, accusing
the committee of penetrating the CIA servers and that referral was based on
false information.

So, the details that came out later in the day were pretty damning to
the CIA.

KORNACKI: So, now, the next step apparently John Brennan is talking
about an internal investigation. It`s former Indiana Senator Evan Bayh,
former Democratic Senator Evan Bayh, who`s going to lead this internal
review for the CIA. Is there an expectation about -- obviously, the
potential here is, is this wider? Is there more that`s going to be
uncovered that kind of malfeasance of it`s there? Was or this sort of a
CYA investigation?

MAZZETTI: Well, accountability boards in the CIA are generally
narrow he focused. Their focus on the people who are originally targeted,
originally intended to focus on. So, there will be a universe of people.
The inspector general named five people, not by name, but identified five
people.

And the accountability board will look at those people. So, it`s not
going to be the accountability board where this widens, but there`s a lot
of anger in the Senate today from Republicans and Democrats about the
action carried out by the CIA, so if this widens, if it gets bigger, it`s
going to be because the intelligence committee, both Republicans and
Democrats, are angry enough about this activity that they think that more
action needs to be taken.

And so, that`s why, you know, by the end of tonight, it sort of
seemed like this could go somewhere because you heard even staunch
Republican allies of the CIA sharply criticizing what had happened.

KORNACKI: Here`s the million-dollar question. Talk about staunch
Republican allies of the CIA. You also talk about an Obama appointee here,
an appointee of a Democratic administration, John Brennan, running the CIA.
Now, his nomination was a little contentious in terms of criticism from
left when he was first nominated.

Tonight, apparently, Mark Udall, Democratic senator from Colorado
saying he lost confidence in John Brennan.

The million-dollar question is, John Brennan`s future, is that in
some jeopardy now?

MAZZETTI: I mean, at the end of the day, do I think Brennan is going
to survive this and continue on? Yes, I do. I do think that he`s got the
support of the president. I don`t think there`s going to be enough
Republicans or Democrats who are going to join Udall and call for his
resignation.

Very pointedly, Dianne Feinstein, the chairwoman of the intelligence
committee, did not call for his resignation, so I think he will carry on.
But it certainly damages his credibility with the people he relies on to
support him in this job.

And as you set up before, the backdrop of this whole saga is this
6,000 page interrogation report that`s coming out soon, that`s going to be
very damning toward the CIA, not John Brennan`s CIA, but to the CIA in
general. And Brennan finds himself in the position of defending the
agency, even at a time when the Obama administration, President Obama,
himself, has criticized these methods of torture.

So, it`s a very difficult situation for Brennan, and it also is going
to ramp up the pressure on him.

KORNACKI: Right. It`s really interesting here. All of this
controversy, this huge story coming out before the huge story of this
actual report comes out. There`s a part two to this, definitely.

Mark Mazzetti, national security correspondent for "The New York
Times" -- thanks for your time tonight.

Things are getting serious and not in a good way for one of the most
prominent governors in America.

Stay tuned.

(COMMERCIAL BREAK)

KORNACKI: Today was Rolex day in what was day four of the federal
corruption trial of former Virginia Governor Bob McDonnell and his wife,
Maureen McDonnell. The Rolex that made it Rolex day is, of course, this
one, engraved to say 71st governor of Virginia. And given by Virginia
businessman Jonnie Williams to the 71st governor of Virginia, Bob
McDonnell.

Rolex is one of the most famous or maybe one of the most notorious
items among the tens of thousands of dollars in gifts and cash that
Williams says he gave the McDonnells in order to develop a business
relationship with the chief executive of the commonwealth.

Today, Rolex was in evidence as prosecutors had members of the jury
handle it this morning, reportedly so they could properly inspect it.

Prosecutors asked Jonnie Williams about it. And upon reflection,
Williams said, quote, "It was a bad decision to buy the watch."

And you probably got to give him that point, because when you buy
something that winds up being presented by federal prosecutors to members
of a jury, it generally was a good sign it wasn`t a wise purchase. So, it
went for federal prosecutors and the former governor today of Virginia.

More news, though, of a U.S. attorney and a current governor of a
major state, a governor not named Chris Christie. That news is coming up
next.

(COMMERCILA BREAK)

KORNACKI: April of 2013 was a terrible month if you were an elected
official in the state of New York. In April of 2013, several New York
state politicians and party leaders were arrested for trying to sell the
New York City mayoral race. And a state assemblyman was arrested for
trying to sell legislation. U.S. attorney for the southern district of
Manhattan announced all of those charges within 48 hours, that month.

It was humiliating and it shattered any hope that Albany was anything
but corrupt. And so, in response to all of this, the governor of New York,
Andrew Cuomo, made it one of his chief priorities to get ethics reforms
passed in his state. He tried to get his ethics bill through the state
legislature but the legislature wouldn`t do to, so that effort filed.

After that, Governor Cuomo decided to appoint a commission. It was
called the Moreland Commission. to investigate public corruption. This was
going to be Cuomo`s way of fixing the corrupt system in New York without
the legislature because the legislature didn`t seem interested in doing
anything.

And now, I know what you`re thinking when you hear the term
commission, join hear about a politician appointing a commission.
Appointing a commission is what politicians like to do when they don`t
actually want to do anything. Commission studies something, it issues a
report, a report collects dust. You know, that`s how it usually goes in
politics.

But this was different. What Andrew Cuomo was proposing was
different, because in New York state, there are normal commissions and then
there are Moreland Commissions.

Sherman Moreland was the leader of the New York State Assembly back
in 1907, when he sponsored legislation giving the governor of New York
sweeping powers to launch investigations.

Quoting from "The New York Times" back in that year, "The Moreland
Act authorizes the governor at any time either in person or by one or more
persons appointed by him to examine and investigate the management and
affairs of any department, board, bureau, commission of the state
government. The governor and the person so appointed are empowered to
subpoena and enforce the attendance of witnesses and to require the
production of any books or papers that maybe deem relevant or material.

Subsequent state legislators tinkered with that language. In New
York state, Moreland investigation, has historically been a very real
investigation, a very serious investigation. 1911, the head of the state
forestry service had to resign after a Moreland investigation. 1976, New
York state`s laws regulating nursing homes were overhauled because of a
Moreland investigation into fraud in the nursing home industry.

And in 1987, it was Governor Mario Cuomo, that`s a father of Andrew
Cuomo who launched his own Moreland Commission to investigate ethics
failures in state government.

So, when Governor Andrew Cuomo convened his own Moreland Commission
last summer, people took it very seriously. And when he did that, Cuomo
stretched that the commission had a broad mandate to look into potential
wrongdoing at every level in state government. Commission could
investigate whomever they wanted, he said, including him, including the
governor. Quote, "They have total ability to look at whatever they want to
look at".

Well, according to a three-month investigation by "The New York
Times," whenever that Moreland Commission came close to investigating some
entities affiliated with Governor Cuomo, there was a clear order from the
governor`s office. That order was to back off.

Like when, according to "The Times`" report, the governor`s office
quashed a subpoena to a media buying firm that it`d done work for Governor
Cuomo. Or when the governor`s office stepped to squash another subpoena to
a group who had made generous political donations to the governor or when
the commission staff started keeping documents in their personal computers
because they suspected that the governor`s office was monitoring their
communications. Essentially that it was spying on them.

Governor Cuomo`s office responded to that "New York Times" story by
saying that the commission was never meant to be independent. It was
created and appointed by the governor, he said, could not be independent of
the governor because of that. Quote, "It`s my commission," he said back in
April. "I can`t interfere with it because it is mine. It is controlled
by me."

And then, this week, another weird twist in all this because since
that "New York Times" story broke last week detailing interviews and e-
mails in which the commissioners railed against interference by the
governor`s office. Since that report was published, several former members
of the commission have come forward to defend Governor Cuomo, to deny there
had been any interference at all.

Now, all this has piqued the curiosity of the U.S. attorney for the
southern district of Manhattan. His name is Preet Bharara. Bharara has
seized the Moreland Commission`s records. He`s announced that he will
follow-up on their investigation, the investigation they were never able to
finish and he also says he`s going to look into why the commission was
disbanded prematurely.

And today, Bharara sent a letter to Governor Cuomo advising him if
his office was calling former commissioners and asking him to say, defend
the governor, that may fall under the category of tampering with a witness
or obstruction of justice.

Governor Cuomo`s office issued is a statement saying they were
talking with relevant parties about what they say were inaccuracies in "The
New York Times" story. They say they will no longer comment publicly on
any of this.

And meanwhile, "The New York Daily News" reports tonight that
Governor Cuomo`s office hired a, quote, "prominent white collar criminal
defense lawyer" to represent them in this matter.

This is the biggest test so far for Governor Cuomo, not only is
running for re-election this year but has plans to go way beyond New York
state politics.

Joining us now is Blake Zeff. He`s political editor at Salon.com,
and a columnist with "Capital New York".

Blake, you`ve been all over this story. Thanks for joining us
tonight.

You know this as well as anyone who`s covering it. So, let`s just
start with -- we had some of the details from that "New York Times" story
that published last week. It was an amazing story. Some of the details
here about what was apparently going on whenever this commission got
anywhere near the governor`s office.

So, this new story today, the big new piece of this is this letter
that Preet Bharara, the U.S. attorney, has sent to Cuomo and that letter
has to do with how Cuomo responded to the story that was published last
week.

BLAKE ZEFF, SALON POLITICS EDITOR: That`s right. The U.S. Attorney
Preet Bharara is clearly not fooling around. This is a very unusual
aggressive letter to be honest from the U.S. attorney. And essentially
there are two different phases to this. There`s the crime, alleged crime I
should say, then the alleged cover-up.

The crime, as you said, purported alleged crime is the initial, for
lack of a better word, tampering with the Moreland Commission, trying to
squash subpoenas when those subpoenas might have gotten too close to the
governor or to other people.

Now, the second part of this, as you say, today, Bharara is saying
that if the governor asked people who are members of the commission to
defend him and to put out statements saying that no, this was a completely
independent commission, Bharara seems to be suggesting in that letter if
the governor had a hand or his aides had a hand in soliciting those letters
of support, that that, itself, could be a federal crime. That, itself,
could be tampering with a federal investigation.

So, you`ve got two separate pieces here. It`s pretty tough stuff
from the U.S. attorney.

KORNACKI: Yes, so that`s kind of amazing because, I mean, we started
to talk about this. This started to get national attention last week when
this "Times" story published, what we`re basically seeing here is let`s say
there was nothing -- from a legal standpoint, let`s say that nothing that
came out in "The Times" story was wrong, nothing was illegal, Cuomo was
going to be fine on that.

He may be in trouble now because of what`s happened just in the last
week.

ZEFF: That`s absolutely right. There was actually some question
among legal experts as to whether or not the initial meddling, for lack of
a better word, Cuomo did into the commission was actually in violation of
any federal statutes. For one thing, you have a federal prosecutor looking
into a state entity. So, that already seemed to suggest there might be
jurisdictional questions as to how Bharara, the federal prosecutor, could
get into it.

But now that he already made quite clear he was looking into this
issue, so we knew there was a federal investigation already, the idea that
Cuomo and his emissaries may have then tried to influence the members of
the commission to say that this was independent, you might have a more
clear jurisdiction for a federal prosecutor at that point.

There`s another development that`s broken tonight. And "The Albany
Times Union" says that Joe Percoco, a top aide to the governor, actually
get in touch with members of the commission over the weekend, urging them
to put out statements of support for the governor.

Now, it`s important to say that that something that happens quite
often in politics. If you call somebody and say, you know, if you do
disagree with what`s in "The Times" story, feel free to put something out.
That may be OK. But if he`s trying to influence them and saying,
pressuring them to put out those statements, that might be something
altogether different and a top aide might be in the crosshairs of a U.S.
attorney.

Making matters worse for the governor, they could talk to the top
aide and say potentially if they`re really going to gun for the governor,
they could say to the top aide, tell us everything you have on the
governor. Did the governor put you up to it? Is this something he`s
trying to get you to do? We may give you a reduced sentence or immunity in
return for that.

Now, that`s premature. I don`t mean to suggest that`s happening any
time soon. But that`s a nightmare scenario that could be cooked up as a
result of this letter that Bharara put out today.

KORNACKI: So, I`m just curious what your bottom line read in this,
because you follow New York politics, you follow politics in general. I
mean, we see stories like this emerge a lot. And sometimes they go
somewhere, and a lot of times they end up going nowhere.

Do you think this is a serious threat to Andrew Cuomo from a legal
standpoint or political standpoint?

ZEFF: Well, the politics probably follow the legal standpoint in
this case, right? Because he`s got -- he does have a Democratic primary
challenger, named Zephyr Teachout, who`s making an issue of this, but she`s
not well-known and she`s not well-funded. By all estimates, looked like
Cuomo was going to cruise to re-election before this happened.

Similarly in the Republican, in the general election against
Republican Rob Astorino, it`s very hard for Republicans to win statewide in
New York. It hasn`t happened in two decades with exception of incumbent
Governor George Pataki a decade ago.

So, it`s very rare for a Republican to win. So, everyone thought
Cuomo would be assured a victory. But it`s important to say two things.
One, we have not seen big polling in recent days to show us just how much
voters of New York are getting about this potential scandal. That`s sort
of the big what if.

But, you know, more important than that, if there is legal trouble
here for Andrew Cuomo or one of his top aides, I think that changes the
game, because while this is a very complicated story, it`s not very
complicated for voters if they read in the newspapers that the governor`s
top aide is indicted or the governor in the crosshairs of the U.S.
attorney.

Again, I`m not suggesting we`re at this point yet. But were
something like that to happen before the election, that could spell trouble
for the governor.

KORNACKI: Yes, it`s quite a story. We`re keeping a close eye on it
here. This is not the last word here.

But Blake Zeff, political editor of Salon.com, columnist for "Capital
New York" -- thanks for your time tonight. We really appreciate that.

ZEFF: Thanks.

KORNACKI: I have seen Debunktion Junction. I`m familiar with its
function. But I`ve never been in charge of it. But that all changes right
here tonight. It features Scott Brown. It features Jerry Brown, sort of.
And Galveston, Texas.

Stand by.

(COMMERCIAL BREAK)

KORNACKI: So in the whole history of California, there is something
that has never --

(BUZZER)

KORNACKI: -- when the governor, Jerry Brown, traveled to Mexico this
week --

(BUZZER)

KORNACKI: All right. We`ll start over. Former Massachusetts
Senator Scott Brown --

(BUZZER)

KORNACKI: All right. It sounds like this is going to get the full
blown treatment in the place called Debunktion Junction. There we go.
Engineers (INAUDIBLE)

(BUZZER)

KORNACKI: I guess not.

Stay tuned, though. There is debunking to do.

(COMMERCIAL BREAK)

KORNACKI: Debunktion Junction, what`s my function?

OK. Let`s get to the cards.

True or false, the state of California, in its 164-year history, has
never had an openly gay governor.

Well, is it true or false? It`s true. It`s true.

OK. How in the name of George Duke Mazian (ph) is that true? Well,
it`s true in a very technical, very complicated and very roundabout way.

Here`s how it works. See, for the past week, California`s Governor
Jerry Brown has been in Mexico. He`s been meeting with Mexican officials
to discuss trade deals and climate change. And because Governor Brown was
out of the state, he needed the next person in line to replace him
temporarily in case something happened in California that required
gubernatorial action or attention.

And that would be the lieutenant governor, who did step up to the
plate. Then he also had to heave town for a bit, as well.

So, when both the governor and the lieutenant governor are away from
the state, the next person in line for the gig is the California state
senate president. But then he had to leave the state, as well, which left
California Assembly Speaker Tony Atkins, who had nowhere to go, and also
happens to be gay, to take the oath of office and to assume the mantle
until Jerry Brown got back to term.

And while her landmark term lasted approximately eight hours since
Governor brown returned today, Tony Atkins was apparently psyched to do it,
telling a "Business Insider" that she wished her parents could have
witnessed her stint as governor of California. And she also tweeted this
out, quote, "One of my first responsibilities today as acting was to make
sure the acting first dogs got their morning walk." All in the line of
duty, I guess.

All right. Next up, check out this recent campaign ad from former
Massachusetts Senator Scott Brown, who is now running for the U.S. Senate
in New Hampshire.

(BEGIN VIDEO CLIP)

SCOTT BROWN (R), U.S. SENATE CANDIDATE: I`m Scott Brown running for
the U.S. Senate and I approve this message.

Thirty-five years as a member of the Army National Guard, I retired
this year as a colonel. I`m proud of the men and women I served with. But
the Obama-Shaheen economy is not working for them or anyone else. Veterans
deserve better than long waits for patient care, and national scandal.

I`ll get health care back on track and focus on more good jobs for
everyone, because no one should fight for America overseas only to return
home to fight for respect here.

(END VIDEO CLIP)

KORNACKI: So, after this ad was released, a local newspaper reported
that the ad was likely filmed at a log cabin looking building on land owned
by the former speaker of New Hampshire House of Representatives. And the
former speaker`s home was also the setting of another Scott Brown ad
earlier this month.

So, Scott Brown filmed his ad at a friend`s log cabin in New
Hampshire. Is that true or is that false?

(BUZZER)

KORNACKI: False, false, false.

The good folks at "BuzzFeed" followed their spidey senses and
discovered he was standing in front of a green screen. The supposed log
cabin he was standing inside was actually this stock photo, which obviously
is not the former House speaker of New Hampshire`s cabin in the woods. But
you, too, can purchase that same photo and pretend to live in a log cabin
if you want to.

It turns out that Scott Brown hasn`t used the power of the green
screen simply to build this wilderness cred. He`s also used it in this ad.
Scott Brown whipped out the old line at the airport security check stock
video to make it look like he was standing in front of an airport security
line, when in reality he was standing in a studio, or an office, or a
basement somewhere, in front of a green screen.

And finally, true or false? Despite what you may have heard, while
House Republicans still have not been able to vote on the closest thing
they have to an immigration reform bill, the House has, in fact, passed a
pathway to citizenship. Is that true or is that false?

(BELL)

KORNACKI: True. It`s true, technically. If you wait a really long
time it`s true. It`s true if you are this guy, Bernardo de Galvez y
Madrid. He`s the -- or was the viscount of Galveston in the count of
Galvez.

Congressman Jeff Miller of Florida put forth a House resolution this
year to grant honorary citizenship posthumously to Bernardo de Galvez, who
was born in Spain in the 1700s, who became a military hero here in the U.S.
during the revolutionary war.

Only seven other people have received the distinction of honorary
citizen. It includes Mother Teresa and Winston Churchill.

During the Revolutionary War, de Galvez recruited and led an army of
7,500 soldiers to fight British forces throughout the South. He also
helped draft the treaty to end. And for that and his many other efforts to
aid the patriots, he was thanked for his efforts by the Continental
Congress and by George Washington himself. And for his efforts during the
war for U.S. independence, the cities of Galveston, Texas, and Galvez,
Louisiana, were named after him.

And earlier this week, the House voted to pass that resolution to
confer honorary U.S. citizenship on Bernardo de Galvez, a native Spaniard,
who helped change the course of history for the United States.

So, there you have it, the House of Representatives this week did
actually pass legislation to secure a path to citizenship. One pathway for
one person, for one heroic, but long deceased person.

That does it for us tonight. We`ll see you again tomorrow.

Now, it`s time for a man who needs no debunking, "THE LAST WORD WITH
LAWRENCE O`DONNELL."

Good evening to you, Lawrence.

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

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