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Tuesday, April 27, 2010

Read the transcript to the Tuesday show

Guest: Sen. Sherrod Brown, Tom Simplot, Richard Schultz

KEITH OLBERMANN, “COUNTDOWN” HOST:  And now with more on why

Republicans are adamant trying to prevent federal action on immigration

reform—ladies and gentlemen, here is Rachel Maddow.

Good evening, Rachel.              

RACHEL MADDOW, HOST:  Thank you very much, Keith.  I want to know,

what would you have done with that phone if you found it in that bar?

OLBERMANN:  I would have kept for myself and never told anybody about

it.  What would you have done?

MADDOW:  I would have given it to you.

OLBERMANN:  Oh!  That‘s—

MADDOW:  No, I would not.

OLBERMANN:  No, you wouldn‘t.

MADDOW:  That‘s a lie.

OLBERMANN:  You‘re out there tweeting on it.

MADDOW:  Thank you, Keith.

And thanks to you at home for staying with us.

There are days when the balance of the political fight in America is

pretty much even.  Today was not one of those days.



MADDOW (voice-over):  Always remember—if you write it down, some

day, a U.S. senator may say it over and over and over again on national






MADDOW:  It was a day of reckoning for the big bankiest of the big

banks.  And it was another day for Republicans to stand united against

addressing the problem of regulating the big banks.

Senator Sherrod Brown of Ohio joins us live after an amazing day on

Capitol Hill.

According to some from some prominent Arizonans, the new “Papers,

pleas”/anti-immigrant law is not Arizona‘s fault.


SEN. JOHN MCCAIN ®, ARIZONA:  That legislation was enacted by the

Arizona legislature and signed by the governor because of the frustration

that the governor and the legislature, and indeed the majority of my

constituents, have incredible frustration over the federal government‘s



MADDOW:  Ah, so it‘s the federal government‘s fault.  And who‘s

stopping the federal government from doing something?  Very specific

nameable parts of the federal government.  Him.  You guys know your part of

the federal government, right?

Meanwhile, back in Beware-zona, the state faces the threat of

boycotts.  And the mayor of Phoenix says the new law is unconstitutional.


GOV. JAN BREWER ®, ARIZONA:  I hope that we meet again on—better



MADDOW:  And the dark side of “drill, baby, drill” continues to play

out closer and closer and closer to the American gulf coast.  Tonight, the

science of dealing with a massive oil spill that keeps getting more


And the marketing masterminds behind the RNC‘s quasi-legal fake census

fundraising letters defended themselves.  This is good.

There is so much going on in the world and this show is so packed that

you‘re only going to see Ukrainian lawmakers throwing eggs at each other

and defending themselves with umbrellas this one time.  Right now.  Right

here.  Savor it.  Enjoy it.

And get ready for THE RACHEL MADDOW SHOW.  It starts right now.



MADDOW:  Today in Washington, D.C., there was lots and lots of

swearing.  It was not random swearing.  I don‘t even think it was swearing

in anger.  It actually makes sense why there was swearing, but still, a ton

of swearing.  Did you see this?


LEVIN:  Look what your sales team was saying about Timberwolf.  “Boy,

that Timberwolf was one (EXPLETIVE DELETED) deal.”


LEVIN:  They sold that (EXPLETIVE DELETED) deal.

DAN SPARKS, FMR. GOLDMAN SACHS OFFICIAL:  This email was from the head

of the division, not the sales force.


LEVIN:  Whatever it was, it‘s an internal—it‘s an internal Goldman


SPARKS:  This was an e-mail to me in late June.

LEVIN:  Right

SPARKS:  -- after the transaction—

LEVIN:  And you sold Timberwolf—no, no, you sold Timberwolf after

as well.

SPARKS:  We did trades after that.

LEVIN:  Yes.  OK, and the trades after—

SPARKS:  Some context might be helpful.

LEVIN:  The context, let me tell you, the context is mighty clear. 

June 22 is the date of this e-mail.  “Boy, that Timberwolf was one

(EXPLETIVE DELETED) deal.”  How much of that (EXPLETIVE DELETED) deal did

you sell to your clients after June 22, 2007?

SPARKS:  Mr. Chairman, I don‘t know the answer to that.  But the price

would have reflected levels they want to invest at that time.

LEVIN:  Oh, of course.  But they don‘t know it‘s—you didn‘t tell

them you thought it was a (EXPLETIVE DELETED) deal.

SPARKS:  Well, I didn‘t say that.

LEVIN:  No, who did?  Your people, internally.  You knew it was a

(EXPLETIVE DELETED) deal and that‘s what your e-mail showed.


MADDOW:  To be a fly on the wall at C-Span headquarters when that was

going down on live TV today, right?

Wow!  That was Democratic Senator Carl Levin making a point to a very,

very slippery Goldman Sachs witness about whether or not Goldman knowingly

sold something they knew was (EXPLETIVE DELETED)  That‘s basically the

heart of the big, complicated SEC fraud case against Goldman Sachs.  It‘s

about whether or not they knowingly sold people something they knew was

going to go kablooey because there was a way to profit from things going

kablooey as long as Goldman could trick some poor shlubs into believing

that what they were selling wasn‘t actually going to kablooey at all.  It

was pure gold.

It‘s all dressed up in fancy Wall Street quantitative language, but it

essentially, was an age-old scam—the kind of thing for which regulation

was invented.  To force some transparency into the marketplace so people

know what they‘re buying and so people selling stuff are forced to compete

without tricking their customers.

Wall Street‘s allergy to transparency was on display today in

exchanges like this one between that same former Goldman Sachs official and

Democratic Senator Mark Pryor.


SEN. MARK PRYOR (D), ARKANSAS:  Do you have a responsibility to tell

them what your positions are?


PRYOR:  Why not?

SPARKS:  Market makers are going to have positions all the time and

that‘s not something that is a responsibility of a market maker to tell

your counterparties at all times how you‘re positioned.

PRYOR:  But why not?  Shouldn‘t there be more transparency there?

SPARKS:  I—is that a—that‘s a perspective question or a current


PRYOR:  Either way.

SPARKS:  Well, currently, that‘s not an obligation.


MADDOW:  So, the way things are now, we don‘t have to tell anybody

anything.  If we know it‘s toxic waste, we can sell it as baby formula. 

What‘s the problem?  It‘s the market.

Having Goldman Sachs officials in front of a Senate committee today,

having exchanges like that, having them amid stuff (ph) like that, was an

opportunity for every senator—left, right and center—to show off just

how displeased they are with Goldman‘s practices, just how disgusted they

are on behalf of their constituents.


LEVIN:  Goldman‘s actions demonstrate that it often saw its clients

not as valuable customers, but as objects for its own profit.

SEN. CLAIRE MCCASKILL (D), MISSOURI:  It‘s gambling, pure and simple,

raw gambling.  You were chasing compensation.  You were chasing your

colleagues and other investment banks and you were trying to make a


SEN. TED KAUFMAN (D), DELAWARE:  These halls are full of folks who‘ve

come before Senate committees and said, “Well, everybody was doing it.” 

So, I don‘t think that “everybody was doing” thing is going to hold up real


SEN. JOHN MCCAIN ®, ARIZONA:  There‘s not doubt their behavior was

unethical and the American people will render a judgment, as well as the



MADDOW:  Bipartisan.  Both sides equally disturbed by what passes for

investment banking on Wall Street now.  When was the last time you saw

something bipartisan in the Senate?  Consensus, right?

What sort of action should be taken as a result?


LEVIN:  You got no regrets, you ought to have plenty.  I don‘t think

that you‘re willing to acknowledge them, but you ought to have them.  I

don‘t think you will acknowledge them.  That‘s why we‘ve got to do some



MADDOW:  “That‘s why we‘ve got to do some regulation,” says Carl

Levin.  But it wasn‘t just the Democrats saying that today.  It was

Republicans, too.


SEN. SUSAN COLLINS ®, MAINE:  Clearly, this system must be reformed

so that Wall Street banks are not seen and do not act as unscrupulous

operators who seek to profit from the public‘s misfortune.


MADDOW:  Republican Senator Susan Collins: “Clearly, this system must

be reformed.”  The system must be reformed.

Both Democrats and Republicans billboarding that message over the

Goldman Sachs hearings today.  The difference though, for all the

bipartisan agreement, bipartisan compliant, the difference between

Democrats and Republicans on this issue though is that while that hearing

was going on and everybody in a bipartisan way was complaining and damning

Goldman Sachs and talking about how much reform is needed—while that was

happening, Democrats actually voted for Wall Street reform and Republicans

all voted against it.

For the second day in a row, the United States Senate did not just

whine about the need for Wall Street reform, they held a vote on it.  They

held a vote on whether or not to begin debate on a Wall Street reform bill. 

And for the second day in a row, every single Republican along with

Democrat Ben Nelson—we‘ll get to him later—voted no.  And Wall Street

reform was blocked from moving forward.

That‘s the real odd political dynamic that‘s happening in Washington

right now.  Even as everybody tries to claim the political mantle of being

against the demon Wall Street, Republicans continue to vote against new

regulations for Wall Street.  They‘re filibustering new regulations for

Wall Street and Democrats continue to vote for new regulations.

Yesterday, Democrats held the first vote on Wall Street reform, and

every Republican voted to filibuster, voted no.

What did Democrats do next?  As you saw, today, they decided to hold

another vote on Wall Street reform—and again, every Republican voted to

filibuster, voted no.

I‘m guessing, if Democrats could find a way to hold these votes every

five minutes, they probably would, because every time they do, it puts

Democrats on record against Wall.  To that end, Democrats have scheduled a

third vote on the issue for tomorrow at noon.

For all the peacocking that Republicans got to do in a hearing like

the Goldman Sachs one today, for as much as they tried to get alongside

Democrats to really be seen to go after Goldman, look at the “Associated

Press” headline that crossed the wires right in the middle of that hearing

today.  This is the headline, quote “For a second day in a row, Senate

Republicans block action on regulation bill.”

If Democrats have finally found their political mojo and it seems like

they might have on this issue, expect them to schedule as many votes as

possible to get as many of those headlines as possible, for as long as the

GOP is willing to keep handing it to them.

Joining us now is Democratic Senator Sherrod Brown of Ohio.  He is a

member of the Senate Banking Committee.

Senator Brown, thanks very much for your time tonight.

SEN. SHERROD BROWN (D), OHIO:  Glad to be back, Rachel.  Thanks.

MADDOW:  So, does this just happen indefinitely now?  Every day,

Republicans filibuster Wall Street reform, a Democrat say, hey, look, they

are filibustering Wall Street reform.  Does it just happen indefinitely? 

Where does it end?

BROWN:  Well, it ends when some number of Republicans just get too

embarrassed.  There‘s an old saying, “Don‘t tell me what you believe, tell

me what you do.”

And I think that there is a number of Republicans that just can‘t keep

doing this when they‘re on the ballot in 2010 or maybe when they‘re in the

ballot in 2012.  And they know that they can do all the showiness they want

in committee and they can talk tough at home, but, in the end, they protect

their Wall Street friends, they protect their big bank Wall Street buddies.

And eventually, we‘re going to do this day after day.  We‘re probably,

tomorrow night, going to stay all night and just continue to do this until

we break some of them free.  Then we‘ll have real votes on the floor.

This is—you know, Rachel, this is just to have the vote.  This

isn‘t even—this is just to have the debate on the Senate floor.  This

has nothing to do with final passage yet.

So, we just want to put it out there and then start the amendment. 

Some of us have some very good strengthening amendments.  Some are not so

good.  And we‘ll see what happens.

MADDOW:  To that end, on the issue of whether or not Republicans are

going to continue to hold out on a unified block, there is some very late

reporting tonight, from just moments before we went on the air, that your

Republican colleague from Ohio, Senator Voinovich, may switch his vote

tomorrow and support a vote to move debate forward on this bill.

Do you have any reaction to that late-breaking news?

BROWN:  Yes.  Senator Voinovich is more independent than the average

Republican.  And he‘s voted for unemployment and COBRA extension a couple

of weeks ago.  He breaks them from time to time.

I know he‘s frustrated with this and he doesn‘t buy into this—I

mean, he was very critical of the Republican Party—with an editorial

board meeting at the “Columbus Dispatch” a few months ago and he said

they‘d become a southern-based party and mentioned Jim DeMint and some

others that just this conservative, good old boy southern party.  And he

knows that‘s the party he‘s leaving, the party he was here as he leaves the

Senate and I think he‘s going to speak for him, of course, but I think he‘s

frustrated by it.

But he‘s one of several that are frustrated.  And I just can‘t imagine

that Republicans are going to continue to block Wall Street reform when

it‘s one of the most important things we need to do this year.

MADDOW:  If debate does go forward, if Senator Voinovich or others

come across the aisle or Senator Nelson reconsiders his position, for

example, and debate does go forward, you know, one of the amendments that

you have pursued is one about the size of banks.  What do you think the

prospects are for your amendment?  And how much support are you hearing

from leadership on that?

BROWN:  Well, I think they‘re increasingly better, as people see these

Goldman—these hearings that Senator Levin did today with Goldman. 

There‘s one statistic that astounds people, that 15 years ago, the six

large—the assets of the six largest banks in the United States totaled

17 percent of gross domestic product.  Today, the six largest banks‘ assets

combined total 63 percent of gross domestic products.

So, it‘s clear that more and more people are understanding that we

can‘t give five or six or seven or eight banks, or two or three banks, that

kind of economic power, that kind of power over the whole economy.  We

suffered enough from that sort of situation and I think that—and you

know, this is supported by former Federal Reserve chairmen and supported by

pretty mainstream economists.

This isn‘t some lefty, crazy, radical idea to break the banks up. 

It‘s a sober, centrist, “take them on because they‘re doing damage to our

economy” reaction.

MADDOW:  On health reform, Senator—and I mean no disrespect by this

at all—my take on how things went is that Democrats were not great

negotiators.  Democrats gave away a lot in terms of policy in exchange for

no Republican votes in the end for that bill.

Right now, as we think about debate on the Senate floor versus

negotiations out of the public spotlight, what‘s your sense of whether or

not Democrats are being better negotiators and whether or not they‘ve

learned some of the lessons about being pretty hard-nosed about those

things after what happened in health reform?

BROWN:  Yes, I think people learned their lessons and we have a—we

have a much stronger public in support of moving forward and moving this

bill and a more progressive direction.  Not compromising.

You know, compromise to Republicans and bipartisanship really has been

bring in the interest groups, bring in the health insurance companies, and

bring in the—bring in Wall Street banks and give them something, let

them sit at the table, and give them something and slap a bipartisan label

on it.  That‘s not what we‘re doing.

And that‘s not what we should have—we should not have done that in

health care.  We sure are not going to do it now.  This bill is going to

get increasingly stronger, pro-consumer, pro-Main Street instead of pro-

Wall Street.  And that‘s what‘s so energizing for so many Democrats now

that we‘re standing strong.

It really is a question of who‘s side are you on.  Republicans have

consistently sided with Wall Street.  They‘re going to pay for that in

November and they increasingly understand that, at least the ones that can

get out of the tight grip of Mitch McConnell.  And the Democrats clearly

are on the side of Main Street.

But McConnell‘s view is this worked for them the last 16 months, this

kind of obstruction.  Well, it‘s not going to work for them now in a

handful of more independent, open-minded Republicans are starting to

understand it.

MADDOW:  Democratic Senator Sherrod Brown of Ohio—thank you very

much for your time tonight, sir.  We really appreciate it.

BROWN:  Thank you, Rachel.  Thanks.

MADDOW:  There‘s one Democrat who voted with Republicans against

opening debate on financial reform.  His name will not surprise you—Ben

Nelson.  But his apparent motives might.  That story is ahead.

Also, the stink over Arizona‘s “Papers, please” immigration bill is

getting bigger.  The mayor of Arizona‘s largest city threatened a lawsuit

against the new law and a boycott movement is gaining steam.  Arizona has

dealt with that before to very dramatic effect.

That‘s all ahead.

But, first, “One More Thing” about today‘s Senate hearings on Goldman

Sachs.  There was sort of an amazing moment that happened toward the

beginning of today‘s marathon hearings.  See if you can spot the irony in

this particular line of questioning being pursued by this particular United

States senator.


SEN. JOHN ENSIGN ®, NEVADA:  Do you think that the incentives that

are set up in firms like Goldman Sachs are the proper incentives to have

folks engage in ethical behavior?

SPARKS:  Senator, I think Goldman Sachs works hard to engage in

ethical behavior.

ENSIGN:  I didn‘t say that.  Do you think that those incentives are

there that lead to ethical behavior?


MADDOW:  Imagine what it was like in the Republican cloakroom before

this hearing.

OK, who‘s really going to go after these guys for ethical behavior? 

Who‘s going to go after these guys on ethics?  John Ensign, you up for it? 

John Ensign currently under federal and Senate investigations on ethics

charges related to shtooping your employee and your former staffer‘s wife -

John Ensign, you want to be our ethics point man here?  Hey, David

Vitter, you want to see if there‘s a way to go after them on hookers?



MADDOW:  Arizona‘s new immigration law has vaunted immigration way up

the government‘s priority list, except for the people in that government

saying, no, no, no, let‘s definitely not address immigration at the federal

level.  Interestingly, the no, no, no, let‘s not do it guys are the same

people who are complaining that the federal government isn‘t doing enough

on immigration.

The political art of punching yourself in the face while yelling “stop

hitting me” at the same time—next.



GOV. JAN BREWER ®, ARIZONA:  The bill I‘m about to sign into law,

Senate Bill 1070, represents another tool for our state to use as we work

to solve a crisis that we did not create and the federal government has

refused to fix.


MADDOW:  And, of course, as Arizona Governor Jan Brewer explaining her

decision to sign into law the “Papers, please” bill which compels law

enforcement officers in Arizona to stop anyone who looks like they might be

an illegal immigrant to demand that that person show proof that they are

not, in fact, here illegally.  In Arizona, you are presumed illegal unless

you can prove otherwise—papers, please.

Arizona needs this law, in Governor Brewer‘s estimation, because the

federal government is not doing a good enough job dealing with immigration. 

The Arizona governor is not alone in that assessment.  There‘s actually a

fairly wide consensus on both sides of the political aisle that what

happened in Arizona only happened because the feds haven‘t acted to fix the

immigration system and the problem of illegal immigration.


MCCAIN:  This law is a response to the president‘s and the

administration‘s failure to secure our borders.


responsibly at the federal level.

UNIDENTIFIED MALE:  Arizona has a point, which is the federal

government has not done a good enough job.

SEN. RICHARD SHELBY ®, ALABAMA:  The federal government, the

immigration people, have not enforced the laws.

SEN. CHRIS DODD (D), CONNECTICUT:  This is—it‘s demanding a

national answer to immigration policy.

UNIDENTIFIED MALE:  The state of Arizona has decided to take matters

into their own hands.

UNIDENTIFIED MALE:  That‘s why we need comprehensive immigration

reform to secure our borders.

UNIDENTIFIED MALE:  After years of the inadequate enforcement by the

federal government, the states are driven to this.


MADDOW:  If only these guys could get someone in the federal

government to listen to them.

Wait, aren‘t they the federal government?  Yes.  Everybody both people

for the law and people against the law are all saying that the reason

Arizona‘s law was passed and signed and now exists is because the federal

government hasn‘t acted on immigration reform and/or border security.

Well, the federal government could act on immigration reform.  The

federal government is made up of people whose job it is to decide to do

things, to fix problems.  And if all these federal lawmakers, all those

federal lawmakers you just heard are lamenting that the federal government

hasn‘t acted on immigration, you wondered—well, they‘re the federal

government, why aren‘t they acting.  Why isn‘t anything happening right now

on immigration reform?


SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER:  I just don‘t think this

is the right time to take up this issue.

UNIDENTIFIED MALE:  We‘ve got a lot of work left on our plate between

now and the end of the summer.

SHELBY:  I think we have to look at the details.

UNIDENTIFIED MALE:  I‘d be worried about the nature of the bill we

might see.

MCCONNELL:  It‘s not a great time to take this issue up in Washington.


MADDOW:  But I sure wish Washington would do something.

You know, a funny thing.  Check this out, March 19th.  Last month, an

op-ed titled, “The right way to mend immigration,” authored by Charles

Schumer, Democrat, and Lindsey Graham, Republican.  Here are the two of

them are, putting forward their bipartisan immigration reform plan,

strengthening border security and enforcement.  They want biometric Social

Security cards to crack down on illegal workers.  They want a new official

process for temporary workers and they want a, quote, “tough but fair path

to legalization for those already here.”

That was bipartisan immigration reform—a bipartisan immigration

reform proposal put forward by Lindsey Graham and Chuck Schumer last month. 

And now, Lindsey Graham is against it.

In fact, Lindsey Graham has gone so far as to bail on the bipartisan

climate change proposal he was working on with John Kerry as well because

he‘s mad that Democrats might bring up his immigration reform proposal

first.  He said, quote, “This comes out of left field.  We haven‘t done

anything to prepare the body or the country for immigration.”  Except for,

you know, that time last month when I helped write that op-ed, explaining

what it was and why we need it.

Lindsey Graham now is against the thing he co-wrote an op-ed to push

for just last month.  It‘s like they say, everybody complains about the

weather, but nobody does anything about it.  Immigration reform is not the

weather.  It doesn‘t just happen on its own while we all sit back as

observers of it and complain or cheer.  It is a decision that is made

actively by politicians, and the decision to not do anything on immigration

reform is a decision that is being made right now by specific people, by

the Republican Party.

They also don‘t want to do Wall Street reform.  And they didn‘t want

to do health reform either.  But Democrats got that done anyway.

Are Democrats going to get immigration reform done as well?  Not if

the Republicans can help it.  But, you know, that‘s been true of everything

that‘s gotten done in the last 18 months or so.  You can‘t get away with

saying simultaneously that you want something done and that you won‘t do


I mean, if you‘re just some jerk like me talking about politics on TV

or some guy at the water cooler or someone calling in to talk radio, you

probably can get away with saying you want the federal government to do

something that you won‘t do yourself.

But if you are actually part of the federal government, if you are

part of the legislative body that is one branch of the three branches of

government that we have in this country, you can‘t really get away with

saying “there ought to be a law” because you make the laws.  You can‘t

really get away with saying that something should done and also at the same

time saying that you refuse to do it.  At least you ought not to be able to

get away with that.



UNIDENTIFIED FEMALE:  What does an illegal immigrant look like. 

GOV. JAN BREWER (R-AZ):  I do not know.  I do not know what an illegal

immigrant looks like.  I think that there are people in Arizona that assume

they know what an illegal immigrant looks like.


RACHEL MADDOW, HOST:  What does an illegal immigrant look like?  For

all the Arizona governor‘s explicit promises that racial profiling is not

allowed by her state‘s new “papers, please” law, neither she nor anyone in

Arizona has yet been able to describe what counts as reasonable suspicion

for a police officer to stop a person and demand that that person prove he

or she is in the country legally. 

And so Arizona has now asked the federal government for help in

determining what criteria police officers should use in figuring out who

looks illegal.  No word yet if they‘ll get that help from the federal

especially since President Obama has ordered the Federal Justice Department

to review Arizona‘s new law in terms of its civil rights implications. 

Meanwhile, the objections to Arizona‘s law continue to

reverberate.  The Board of Supervisors in the City of San Francisco at this

hour are considering a resolution to boycott Arizona by ending city

contracts with Arizona-based firms. 

Late today, Mayor Gavin Newsom announced a moratorium on San

Francisco city employees‘ official travel to Arizona.  One lawyer‘s group

has already dropped a national convention that the group had planned for

Arizona for the fall. 

Tucson Congressman Raul Grijalva, who is a guest tonight on

“COUNTDOWN,” continues to call for everyone to boycott his home state. 

Phil Gordon, the mayor of Phoenix, Arizona‘s largest city is, of course,

hoping to avoid a state boycott, but he‘s described the new law as


The mayor had threatened to sue the state over the new law, but

he couldn‘t get the Republican majority on Phoenix‘s city council to

support him.  Late today, Mayor Gordon dropped his pursuit of getting the

council‘s backing on the planned lawsuit and decided to bring the suit on

his own. 

And here‘s one - sportswriter Dave Zirin, who has been a frequent

guest on this show, is urging his readers to boycott the Arizona

Diamondbacks baseball team in whatever ballpark they‘re playing in, both as

a symbol of the state and because the team‘s owners have been such major

supporters of the Republican Party, which sponsored and passed the bill. 

A civil rights sports boycott is the sort of thing that resonates

in Arizona.  You might remember that way back in 1987, the state‘s

Republican governor then rescinded Arizona‘s participation in the federal

holiday honoring Martin Luther King, Jr. 

A voter referendum in 1990 also rejected that holiday leading the

NFL Players Association and the NFL in 1991 to yank a planned Super Bowl 27

from the City of Phoenix.  The following year, Arizona voters changed their

minds about honoring Martin Luther King. 

The state did get its super Bowl a few years later in 1996, but

not before tourism officials estimate that that time as a pariah state

because of a civil rights issue cost just the City of Phoenix alone almost

170 conventions and an estimated $300 million in lost revenue. 

I should probably also mention that major league baseball‘s

annual all-star game and all of the tourism it brings with it is scheduled

for Phoenix next July. 

Joining us now is Tom Simplot.  He is on the Phoenix City

Council.  Mr. Simplot, thank you very much for being here.  Appreciate your


TOM SIMPLOT (D), PHOENIX COUNCILMAN:  Hi, Rachel.  Happy to be here.

MADDOW:  What happened this afternoon that prompted Mayor Gordon to

not seek a vote from the city council about suing over this law? 

SIMPLOT:  Well, two of our colleagues issued press releases basically

saying that they were not going to support the effort and that they didn‘t

think that the mayor had the majority of the votes in order to do that. 

So at the last minute, the mayor pulled several of us off to the

side and said the city charter actually allows him as mayor to initiate

legal action on behalf of the city.  So that‘s exactly what he did. 

So we held a press conference and the mayor announced that, in

fact, he would initiate the lawsuit with or without the financial backing

of the city. 

MADDOW:  And do you support him doing that? 

SIMPLOT:  Oh, absolutely.  Absolutely.  That‘s why I was a part of the

press conference.  And we have a draw a line somewhere and we have to stand

up to what is wrong and this law is wrong. 

MADDOW:  Why do you think that the City of Phoenix should sue on this? 

Obviously, it‘s one tactic among many that can be used to sort of oppose

this.  But now that it‘s passed, a lawsuit, I would assume, be enough for

the City of Phoenix to injunct(ph) the state from actually enforcing it. 

SIMPLOT:  Absolutely.  That‘s exactly the goal, stay the enforcement

of the implementation of the law, and quite frankly, send the message to

the rest of the country that Phoenix is not a part of any of what this is -

any part of the creation of this law. 

Phoenix is a much more progressive city than, quite frankly, most

of the state.  And this sends a clear message to that effect. 

MADDOW:  That said, a majority of the city council are Republicans and

those five Republican members apparently could not be counted on to support

the mayor‘s proposed lawsuit here. 

SIMPLOT:  That‘s right.

MADDOW:  Are those objections based on their support for the bill?  Or

are they objecting because they just don‘t want the mayor to be suing on

any matter? 

SIMPLOT:  You know, from my perspective, I think it‘s a smoke screen. 

Several of my colleagues, those five individuals in particular, have relied

upon the polling that they say suggested that the majority of Arizonians

believe that this law is the right thing to do. 

Personally, I don‘t believe the polling.  I think if the majority

of Arizonians really knew what that law said, they would agree that the law

is wrong and that we shouldn‘t have passed that law and that it needs to be

stayed so that it doesn‘t go into effect. 

MADDOW:  Mr. Simplot, I wonder if the previous experience of Arizona

being boycotted on the civil rights issue which I described about the Super

Bowl on the Martin Luther King issue back in the late ‘80s and ‘90s, I

wonder if that is sort of on people‘s minds again now as these boycott

calls come up again given the huge financial costs that the City of Phoenix

paid during the time of that first round of boycotting? 

SIMPLOT:  Absolutely.  Those of us who lived through that era before -

and I was an unelected official back then.  But I can tell you it affected

all of us. 

The boycotts - it affected tourism.  It affected home

construction.  It affected the entire State of Arizona.  And that‘s exactly

what could happen again and we need to get this resolved before that


MADDOW:  I have to ask you about one other element of opposition to

this law that maybe isn‘t the most serious of all the elements of

opposition, but it‘s probably the one that is of most interest nationally. 

That‘s the fact that the Colombian pop star, Shakira -

SIMPLOT:  Right. 

MADDOW:  Expected to be in Phoenix on Thursday -

SIMPLOT:  That‘s right. 

MADDOW:  To speak out against this new law.  I anticipate that she

will be the first of many celebrities who will do that sort of thing.  What

do you think the impact of that might be? 

SIMPLOT:  You know, I hope it‘s huge.  This is the first person, like

you said, to come in to the state.  Shakira‘s fantastic.  People listen to

her.  She has a lot of credibility. 

And quite frankly, she also attracts a younger part of the

population who will agree with what she says.  And I think what she‘s going

to say is this law is wrong and we need to get it changed and help us do


MADDOW:  Tom Simplot, Phoenix City council member, thank you very much

for your time tonight, sir.  I know it‘s been a heck of a day in Phoenix. 

SIMPLOT:  Thanks, Rachel.

MADDOW:  Thank you.  You know that fundraising letter the Republican

National Committee sent out that‘s designed to look like a census form?  In

the event that you thought you‘d heard it all, please, please stay tuned

for the RNC‘s new defense of that mailer. 

If we could only make up stuff like this, we would.  We didn‘t

have to today.  They handed it right to us.  It‘s the best thing on the

show today.  Please stick around.


MADDOW:  Every single Republican in the Senate voted yesterday and

then, again, today against debating financial reform.  Every single

Republican and Democratic Senator Ben Nelson of Nebraska.  Ben Nelson is a

conservative Democrat.  He votes with Republicans on lots of things.

But this vote was still a bit of a surprise because right up

until the very last moment, Sen. Nelson seemed like he was on board with

Wall Street reform.  Senate Democrats now say in fact, Ben Nelson was on

board right until the end when he suddenly flipped. 

He reportedly flipped his vote when Democrats took out a Ben

Nelson special carve out deal for Warren Buffett, the world‘s richest man,

who lives in Nebraska, the state Ben Nelson represents. 

Part of this financial reform bill says if you‘re investing in

derivatives, you have to put up collateral now since derivatives are so

risky.  Warren Buffett has famously called derivatives financial weapons of

mass destruction, but that hasn‘t stopped his firm from owning about $63

billion worth of derivatives. 

Nelson wanted Warren Buffett to be immune from the requirement to

put down collateral for derivatives.  Democrats told Ben Nelson no.  They

took away that “Dear Warren, I love you, XO Ben” special deal.  And so Ben

Nelson pulled his support for the bill and he lined up with Republicans to

kill it. 


UNIDENTIFIED FEMALE:  Mr. Nelson, Nebraska, no. 


MADDOW:  Ben Nelson‘s spokesman is denying to the “Roll Call”

newspaper that Mr. Nelson switched his vote - Mr. Nelson switching his vote

had anything to do with the special deal for Warren Buffett.

Mr. Nelson himself told “The Washington Post” that he objected to

consumer protection prohibitions that could harm main street businesses

back home, including dentists.  I have to say though no one‘s backing Ben

Nelson up on these denials. 

Chris Dodd, the Democrats‘ point man on financial reform told

“Roll Call” today that the only concerns Ben Nelson raised with him before

he voted no were about the derivatives thing, quote, “Dentists didn‘t come


Another Democratic Senate staffer told “Huffington Post” today,

quote, “He was on board until today and the only thing that changed was the

removal of that provision.”  That provision that would be so nice for

Warren Buffett.  Bottom line here, Ben Nelson, for now, is siding with

Republicans to stop Wall Street reform. 

His fellow Democrats say it‘s because they wouldn‘t let him do a

special deal to help Warren Buffett‘s company, Berkshire Hathaway.  And now

is the part where I tell you that according to his most recent financial

disclosure statement, Ben Nelson and his wife own between $1 million and $6

million in Berkshire Hathaway stock. 

And now is the part where you say, “Oh, yes.  I totally saw that



MADDOW:  The oil slick spreading in the Gulf of Mexico is now larger

than the state of West Virginia.  The latest on this jaw-dropping

environmental disaster and the methods being used to contain the damage,

some of which are fascinating, coming up.


MADDOW:  And environmental disaster is growing in the Gulf of Mexico

off the Louisiana coast, crude oil spewing from a leaky valve 5,000 feet

below where a massive oil rig used to be.  And it‘s spilling at the rate of

1,000 barrels, the equivalent of 42,000 gallons a day. 

The spill started a week ago, last Tuesday, when an oil rig

called The Deep Water Horizon caught fire after an explosion that is still

unexplained.  The rig sank two days later.  Eleven crew members were

missing after the explosion.  They have not been found.  They are presumed


The misery of the loss of those lives is now compounded by the

environmental threat posed by the oil that‘s gushing out of well head

nearly a mile below the water‘s surface.  The coastguard and the owners and

lessees of the well, Transocean and the oil giant, BP, are racing to try to

contain the damage before it gets worse. 

Here‘s what the slick looks like from above.  Those orange

ribbons you‘re looking at - those are sweet crude oil.  The slick now

covers apparently an area slightly bigger than the state of West Virginia. 

Since the oil is actually spilling upwards from so far down from the

seabed, it‘s impossible to tell how much water in the Gulf of Mexico has

been contaminated. 

Here‘s a view of the slick from outer space, showing what all

that oil is near.  See that area along the Louisiana coast there?  That‘s a

wildlife sanctuary. 

But the danger isn‘t just to the animals and plants on the shore. 

The waters that have been fouled already by the slick are home to

endangered and threatened species of sea turtles.  There are also sperm

whales and dolphins, porpoises, blue fin tuna, seabirds in that water. 

Today, the coastguard announced they may set all of that oil on

fire tomorrow reasoning that the danger from the foul smoke may be better

for marine and animal life than the danger from the slick.  Wow.

Meanwhile, the coastguard has deployed 49 vessels to round up as

much of the oily water as then can.  While a mile down, underwater robots

are trying to activate something called a blowout preventer which is

supposed to seal off a wellhead after an explosion or maybe even to prevent

one in the first place. 

The worst case scenario here is that it could take three months

to drill relief wells that would divert the oil flow into a storage

facility.  So with 1,000 barrels a day, the spill could amount to more than

4 million gallons of oil spilling into the Gulf of Mexico before all is

said and done, which will be a little less than half the amount of oil that

spilled from the Exxon Valdez into Alaska‘s Prince William Sound 21 years


Joining us now is Commander Richard Schultz.  He is the

commanding officer of the U.S. Coastguard Atlantic Strike Team.  Thank you

for your time tonight, commander.  I really appreciate it. 


welcome.  Glad to be here. 

MADDOW:  First, what you can you just tell us about the overall

cleanup and containment effort and what have been tried and how successful

efforts have been thus far? 

SCHULTZ:  Well, we have tried a number of different things to try to

contain and mitigate the oil spill that is on the surface right now, as

well as try to do some things that are below the surface as indicated, you

know, 5,000 some odd feet below the surface. 

We have done some dispersant - applications, chemical dispersant

applications to try to disperse the amount of oil, you know, break up into

smaller droplets so that it can naturally degrade into the ocean.

And we‘ve also done a lot of skimming operations, boats, vessels

that are out there skimming the oil, removing the oil from the water and

then, you know, transferring it to some type of temporary storage for it to

be brought to shore or recycled later on. 

And then we have also - are toying around with or thinking about

doing some on-water burning operations, as you mentioned. 

MADDOW:  In terms of on-water burning operations, those sound

incredibly environmentally risky, too.  What is the thinking behind - I

guess weighing out the lesser of evils here in terms of why you would set a

slick on fire as a containment measure rather than continuing of skimming

or some of the other options that you have. 

SCHULTZ:  Right.  Well, there are always some tradeoffs and risks that

you need to think about.  But we are not going to stop any of the other

operations that are ongoing.  We will still continue to perform vessel

skimming operations to remove the oil from the surface. 

We will still continue to employ the chemical dispersant

application to also limit the amount of oil or change the oil that‘s on the

surface in addition to trying to employ the on-water fire application. 

And really, we are not going to be lighting the whole entire

slick on fire.  We basically corral a portion of the oil away from the main

slick and that‘s what we try to burn and not the entire slick itself. 

MADDOW:  How optimistic are you that the actual wellhead can be

capped, that it can be stopped at the source?  The thing that‘s I think is

very upsetting and sort of hard to get your head around about this is that

this isn‘t a vessel. 

This isn‘t the Exxon Valdez.  It isn‘t some sort of other vessel

that has a finite amount of oil in it.  This is a potentially infinite

spill as long as that wellhead keeps spraying.  How optimistic are you that

it can be shut down? 

SCHULTZ:  Well, I mean, we are very optimistic that the wellhead can

be shut down, that is why we continue to make efforts to shut that well in

so that we can stop the flow of oil from that wellhead or at least reduce

the amount of flow.  So every effort is being made to focus on that as well

as continue the oil removal operations on the surface. 

MADDOW:  Commander, I will say, as a person who doesn‘t know very much

about this technology, what I‘m worried about is that we have allowed the

technology for drilling in very deep water to get ahead of the technology

for dealing with safety issues in very deep water. 

Are some of the things that you‘re doing, especially trying to

cap that wellhead - are these things that we have experience with in

shallower water that we haven‘t really tried them before in this deep

water?  Have our safety measures here not kept pace with our drilling


SCHULTZ:  Well, the Coast Guard - we are not experts on, you know,

deep well drilling on the ocean floor.  So I really have to turn that

question over to the experts like BP and other oil exploration companies.

But I do know that, you know, agencies as well as industry out

there take every precaution and every safety measure in place.  I mean, we

value our workers and want to make sure that they are in a safe work

environment and that they certainly stay safe while they are at work. 

MADDOW:  Commander Richard Schultz, commanding officer of the U.S. 

Coastguard Atlantic Strike Team - thank you so much for your time tonight,

sir.  And good luck with this massively and incredibly important project. 

SCHULTZ:  You‘re welcome, Rachel.  Thank you.

MADDOW:  Coming up on “COUNTDOWN,” Keith talks with Sen. Ted Kaufman

of Delaware about his grilling of Goldman Sachs executives today.   And

next on this show, one of the all-time, most audacious defenses for one of

the all-time most cynical political operations.  The operation was the

RNC‘s fake census fundraising letter.  And the defense would make F. Lee

Bailey blush.  That is next. 


MADDOW:  You can‘t see me right now.  You can‘t see me.  The see-

through sheet renders me completely invisible, therefore this is not me on

television hosting THE RACHEL MADDOW SHOW.  I‘m not here. 

If you buy that, it is the same argument that the Republican

National Committee is reportedly making and claiming that its latest fake

census mailer is not illegal. 

As we reported last night, the RNC itself will not divulge the

reasons why its legal department thinks its Congressional district census

mailer is OK, even though the Prevent Deceptive Census Look Alike Mailings

Act was signed into law five days before this was postmarked, making a

crime for the U.S. Post Office to deliver an envelope from a

nongovernmental entity that contained the word “census” on it. 

Unless it also includes this disclaimer that it is not a

government document.  Unless the envelope includes the name of the entity

that sent the solicitation and an accurate return address. 

The new RNC mailer does not have a return address on the envelope

or the name of the RNC.  And it does have the word “census” on the front,

right there, right before the address, where it says “census document

registered to.” 

So how could this not violate the new law?  Well, according to

the spokesman for the Republican Congressman Darrell Issa, who is seeking

to stop the RNC from sending out these fake census mailers, the RNC maybe

hanging their claim that it‘s legal on the fact the new mailer doesn‘t say

the word “census” on the outside of the envelope, which according to

Congressman Issa‘s spokesman, is required to trigger the law.

Instead, the word “census” appears through the envelope‘s window. 

Like this.  See?  I‘m not a fake census form.  There‘s no Rachel here. 

There is just this sheet of Plexiglas. 

Because of that brilliant argument from the RNC, Darrell Issa is

reportedly working on a new law to close the see-through-window loophole,

this as Democratic Congresswoman Carolyn Maloney and Congressman William

Clay asked for and received an investigation by the post office and as

Republican Congressman Jason Chaffetz of Utah pushed the RNC as well to

stop these mailings.

It took Michael Steele to actually bring about bipartisan

agreement in Washington.  People who live in glass houses shouldn‘t throw

fake censuses. 

That does it for us tonight.  “COUNTDOWN” with Keith Olbermann

starts right now. 




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