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'The Rachel Maddow Show' for Tuesday, January 17, 2012

Read the transcript to the Tuesday show

Guests: Al Sharpton, Jon Erpenbach, Jonathan Cohn

ED SCHULTZ, HOST, ED SHOW: Good evening, Rachel. Coming to you from
Wisconsin tonight, I have to tell you I have been summoned to the Great
Dane. I understand I`m on assignment, I have to report the entire story.
So I have to go down to the Great Dane, a local spot and just see if it`s
really what they are serving is really cold. I just have to check it out.

RACHEL MADDOW, HOST: Well, Ed, I will expect a complete report when
you get back here and if it`s not complete I will have to go myself and
complete your assignment. So --

SCHULTZ: Rachel, thank you. Good to see you tonight.

MADDOW: Thanks a lot, Ed. I`m glad you`re there, man.

And thanks to you at home for joining us for the next hour.

You know, before the financial crisis, before Wall Street melted down
at the end of the Bush administration, when Eliot Spitzer was the crusading
attorney general of the great state of New York, Eliot Spitzer earned
himself the nickname "The Sheriff," remember? The sheriff as in the
sheriff of Wall Street.

He earned that nickname because he kept bringing charges -- big,
public embarrassing announced at a press conference charges against all the
most powerful firms. He sued Merrill Lynch. He sued JPMorgan Chase. He
sued Goldman Sachs.

In 2005, he sued an insurance company called AIG. Remember AIG?
Remember when America sharpened our pitch forks and outrage against AIG`s
plan to give bonuses to their executives for their excellent performance in
destroying Wall Street after they got bailed out by taxpayers to the tunes
of tens of billions of dollars.

Remember the AIG bonus scandal? Remember AIG`s role in destroying
Wall Street? Remember that AIG?

Well, before they were that AIG, before they earned that part of their
reputation, Eliot Spitzer sued the pre-financial meltdown AIG. He brought
charges in 2005 saying that AIG and two other firms were telling customers
that they were three separate companies.

Three separate companies that were competing for your business to give
you the best deal, when in reality the charges said the three companies
were working together. They were colluding secretly. They were working it
out amongst themselves to divvy up the business between them for mutual
gain. They were faking that they were in competition.

The most memorable thing about that Eliot Spitzer case against AIG is
that AIG at the time was run by this man. His name is Hank Greenberg. The
other two companies that were supposedly according to the customer, totally
independent but Spitzer said were actually colluding with Hank Greenberg,
those other two companies were run by Hank Greenberg`s sons.

So, three companies, it`s dad, lad and lad, in a colluding triangle to
rip off America essentially. Those were the charges. Hank Greenberg, the
dad of that alleged criminal triangle from AIG, Hank Greenberg got forced
out of the company in the ensuing uproar.

But you know what? Old Hank Greenberg is still around. AIG`s old
Hank Greenberg.

Want to know what he did today? He hosted a multi-thousand dollar a
plate fundraiser for the Republican governor of Wisconsin, Scott Walker,
here in New York.

So, AIG famous white collar criminal suspect zillionaire hosts
Republican Governor Scott Walker, just a few blocks from where I sit right
now in New York City today, while simultaneously at home in Wisconsin where
Scott Walker mostly is supposed to be working, this was the scene today in

Today, people who have been organizing to recall Republican Governor
Scott Walker from office walked boxes upon boxes of signed petitions to the
offices of the Government Accountability Board in Wisconsin. These folks
say they can`t wait until the next election, they cannot wait, they want
Governor Scott Walker out of office now, before his term is up.

And today, they turned in their petitions to qualify the Scott Walker
recall for the ballot.

Now, the minimum number of signatures they need is just over half a
million. The recall organizers had said they were aiming for 720,000.
That would give them a nice cushion in case some of the signatures were
ruled to be invalid.

But when it came time to actually turn these signatures in today,
dang, they turned in more than a million names. That translates to 3,000
pounds of signatures.

And, Governor Walker, when signatures opposing you can be measured in
tons, you may have a problem.

This morning, before those signatures were turned in, Governor Walker
appeared on a conservative Wisconsin radio show explaining that no way were
his opponents going to get a million signatures against him.


GOV. SCOTT WALKER (R), WISCONSIN: The interesting thing, though,
Charlie, say they turn in 720,000 today. They, a month ago, were claiming
it was going to a million -- obviously less than if that`s 720,000.


MADDOW: Yes, they turned in a million.

What they needed to get him recalled was a quarter of all the votes
that were cast just in the election that put Scott Walker in office in the
first place, in 2010. Instead, what they got was nearly a quarter of the
state of Wisconsin`s entire voting population, to sign the petition to
recall Scott Walker.

Oh, but wait, there`s more. Organizers say they actually turned in
1.9 million signatures, about a million of those are for the recall of
Governor Scott Walker. They`ve said they also turned in enough signatures
to recall four Republican state senators -- I should say four more
Republican state senators. In earlier recall effort last year already took
two Republican senators out of office in Wisconsin. Now, they say they are
going after four more senators including the state senate president.

But the bulk of the remaining signatures of those 1.9 million
signatures, are not just to recall the four senators and Scott Walker but
also to recall Scott Walker`s Republican lieutenant governor.

Wow. For the impressive show of force that today represents for the
anti-Walker forces in Wisconsin, Governor Scott Walker still seems sure of
himself. At least he sounded that way this morning.


WALKER: We`re going to get a chance to do what`s never been done
before, have a chance to be elected twice in the same term.


MADDOW: You know, maybe he will be elected twice in the same term.
With guys like Hank Greenberg and the Koch brothers behind him, a billion
percent, and all the other ideologically motivated billionaires he got on
his side.

John Nichols wrote this week about how 10 percent of the money that
Governor Scott Walker is known to have raised to stop the recall effort
against him, 10 percent of that money has come from Texas alone.

With all that money, Governor Scott Walker can presumably raid
infinite money and maybe he will win when the recall election happens,
likely sometime this summer.

Consider the bigger context here. Consider the bigger picture of
what`s going on. 2010 was a obviously a huge year for Republicans, not
just at the federal level but particularly in the states. In 2010,
Republicans swept into office across the country -- state legislatures, and
governorships in particular.

And then they started governing in the states accordingly.

In Wisconsin, of course, that meant an immediate move to strip union
rights in the state, even though Scott Walker had never campaigned saying
he would do that. The resulting massive Wisconsin protests were the
largest in the state`s history. And they led to the equally massive
undertaking to recall the governor. A lot of people thought it could not
be done, but it looks like it`s going to be on the ballot.

In Ohio, it`s been the same kind of deal. Republicans passed
something called Senate bill 5 last year to strip union rights in Ohio.
Ohio voters repealed it at the ballot box this past November before it
could ever go into effect. They repealed it overwhelmingly by a huge

In Maine, again, in an overwhelming vote to recall what the
Republicans did there, Mainers got rid of same day registration, got rid of
the law precluding same day registration for voting.

Same day registration for voting is something that Mainers had been
able to do for nearly four decades. The Republicans got rid of it and
Mainers recalled that Republican law. Maine voted in essence to give
itself back the right of same day voter registration that the state`s
Republicans elected in 2010 had taken away.

Also in Michigan, perhaps the most radical proposal to emerge from the
big red tide of the 2010 election, Governor Rick Snyder`s emergency manager
law, giving him unprecedented power to in effect overrule local elections,
to get rid of local officials, to make it not matter who you vote for in
your city and town if the state doesn`t approve. This is the footage we
aired last night of protesters marching to Michigan Governor Rick Snyder`s
home yesterday to protest that emergency financial manager law.

That law in Michigan may also be recalled by the voters. The people
organizing that recall effort for that law in Michigan say they now have
enough signatures to get the emergency manager law on the ballot for recall
in Michigan, but they say today that they are going to wait and gather even
more signatures just to make sure they are absolutely covered.

There have only been three recalls of sitting governors in the history
of the United States of America. But when a million people said today in
Wisconsin, that -- is that they`d like their Republican governor to be next
on that very, very, very, very short American list.

The 2010 election was a radical landslide for Republicans coast-to-
coast. What we are seeing in the states, though, even if the Beltway media
doesn`t care, never covers it, I`m here to tell you what we are seeing in
the states is that voters in the states governed by Republicans cannot wait
until the next election to undo what they have done. They want these
politicians and their main priorities out and they want them out now.

Joining us now, a Wisconsin lawmaker who`s been at the center of the
recall effort in Wisconsin since day one, Democratic State Senator Jon

Senator Erpenbach, it`s nice to see you again. Thanks so much for
being here.


MADDOW: When all this started, with you and your fellow senators,
fleeing the state to keep the Republicans from stripping union rights in
Wisconsin, when you and I first met over that whole conflict, did you know
it would end like this for Scott Walker?

ERPENBACH: No, I didn`t. I had no idea. I thought initially when we
first talked, I thought we would be in Chicago for a couple days and go
home, we`d work it out. Obviously that didn`t happen. Here we are, less
than a year later, and we turned in over a million signatures to recall the
governor, which is almost as many votes as he got when he was first elected
back in 2010.

MADDOW: In terms of the magnitude of that, we talk about big numbers
a lot in the news, not just about dollars, but often about people, the
million voter threshold is something that nobody had really seriously
floated before it happened today.

Can you give us some sense of how big that number is and how
unexpected that was? It seems like it`s much higher than even the
Democrats highest target.

ERPENBACH: Yes, I was very surprised. When Mike Tate, the chair of
the party, said 720,000 signatures, I thought that would be great. Then I
started hearing 800,000, maybe 900,000, and I`m thinking, boy, that would
be extremely high. But a million is huge.

Think about it we had 60 days to gather up the signatures, which meant
thousands of volunteers were scattered throughout the state and on average,
Rachel, gathered over 16,000 signatures a day. That`s huge. That is a
big, big number.

So it sends a strong message not only to Governor Scott Walker but all
the Republican governors throughout the nation who are thinking about
messing around with collective bargaining rights or taking -- cutting
funding to education and the list goes on and on and on.

This is -- this is a huge wake up call if you`re a Republican governor
right now.

MADDOW: Senator Erpenbach, I have to ask you if you are considering
running against Governor Walker. There is no single declared Democratic
candidate who is the obvious choice to run against Governor Walker. Are
you considering running against him?

ERPENBACH: It certainly is something that I`m taking a look at. But
there is a lot of good people who are talking about it as well. One of my
colleagues, Tim Cullen, who is the state senator, one of the 14, he`s out
of Beloit, in the Gainesville area. Katherine Faulk (ph), the former
county executive. Milwaukee Mayor Tom Barrett. So, there`s quite a few
people who are talking about it.

But what we are doing right now obviously is today is the day to
celebrate in a very kind of ironic. It`s also kind of a sad day if you
think about it on the state`s history. Over a million people want to
change governors here in the state of Wisconsin. And this guy has been in
office a year and a week. So, it`s celebratory day but it`s kind of
strange at the same time.

So, right now, it`s making sure even though election hasn`t been
called yet, making sure the signatures are certified and we move forward
from there.

MADDOW: In terms of your decision whether or not to run, and if you
don`t run, your decision about who you are going to support, who you want
to be the Republican -- excuse me, the Democratic nominee against Governor
Walker, is there a litmus test for you? Is there a specific issue or
specific set of issues that you feel like are must-dos or must-haves for
any Democratic candidate to really carry the party line against Walker?

ERPENBACH: Well, obviously, it has to start with restoring workers
rights and collective bargaining here in Wisconsin. But it`s larger than
that. There are so many more issues out there. Like I said, thousands of
volunteers gathering signatures for thousands of different reasons --
whether it`s taking away from the Badger Care program or senior care
program, you know, over $1 billion in cuts to our K-12 education system
here in Wisconsin, which is really going to devastate our schools. The
voter ID law, which is probably the worst law not only this state has ever
seen but the worst voter ID law I think in the nation.

So, there`s all sort of reasons why over a million people decided to
sign recall petitions.

So, there isn`t any one particular thing, but needless to say, this
starts with collective bargaining, and making sure workers rights are
restored because this is all about the middle class in the end, and making
sure Wisconsin has a very, very strong middle class.

MADDOW: The optics today were striking to see all these petitions
delivered to the Government Accountability Board while Governor Walker was
the subject of a fundraiser hosted by the former head of AIG in New York
City. It was a remarkable decision by the governor that would happen on
the same day, but clearly he does not care.

You don`t go talk to Texas billionaires. You don`t let the AIG guy
host a fundraiser for you the day the petitions are coming out to recall
you if you care that you are being seen to be supported by ideologically
motivated, out of state billionaires.

What is the plan to deal with the huge tide of money that is expected
to support Walker all the way through the recall effort? Can Democrats
compete with that?

ERPENBACH: I think so, but I think we can compete with basically with
people power. What we saw with the million signatures, that`s grassroots.
That`s something money can`t buy, Rachel. But at the same time,
financially, obviously, the Democrats are going to have to be competitive,
this is a race for the governor of the state of Wisconsin, but this race is
essentially a nationwide race, with nationwide implications.

As I said earlier, Republican governors are sitting up and taking note
today and looking at the signatures that were turned in against Governor

So, we tend to think money will flow in from both sides to support
both candidates whoever the Democrat ends up being. But make no mistake,
we`re looking $100 million race in the end. I think it`s going to be in
the super PACs are going to come in with money from the corporations and so
on and so forth.

But you can`t argue, Rachel, a million people signed a petition to
recall a governor who has been in office for one year and a week. That
says a lot.

MADDOW: Wisconsin Democratic State Senator Jon Erpenbach, I should
note pointedly not closing out the possibility he might be one of the
Democrats to run against Governor Walker.

Senator, great to have you here. Thank you for being with us tonight.
Appreciate it.

ERPENBACH: All right. Thanks, Rachel.

MADDOW: It is remarkable to think about in this year, when this much
money is already being spent in politics on the presidential race, right,
not only in the Republican primary but what is expected to be spent in the
general election, for the presidential race in November, before that
election even happens and totally separate from it but obviously connected
by all the important substantial means, we`re talking about another $100
million on this gubernatorial race in Wisconsin.

It`s just incredible. This year has been so unpredictable and so
expensive. We`ll be right back.


MADDOW: Heading in Saturday`s primary in South Carolina, Mitt Romney
has moved way out ahead. Mr. Romney polling now at 35 percent in the
latest Rasmussen poll. Newt Gingrich is the closest challenger at 21.

Look right behind them -- Ron Paul, right there, along with Rick
Santorum at 16 percent.

There are two things substantively going on in the Ron Paul campaign
right now. One is their strategy, which campaign staffers have been
talking about openly with the press. And that is that they plan to stay in
for the long haul. Nobody is expecting Ron Paul to drop out of the race
any time soon, except maybe those who think he`s only dropping out because
he wants to make a run as a third party candidate.

Dr. Paul`s plan is apparently to pick up as many delegates as he can
in every state that might award you some delegates even if you don`t win.
So, that means South Carolina, also Nevada and Colorado. The plan is also
to essentially avoid or at least avoiding spending money in states that are
winner take all, where Ron Paul does not expect to come in first. So, in
other words, his plan is a delegates plan, a long-haul plan to marshal his
resources to stay in the race to get as many delegates as possible and to
not waste time trying to make some sort of case that doesn`t result in

So, that`s the substantive, tactical thing that`s going in the Ron
Paul campaign. The substantive policy thing that`s going on is that Ron
Paul`s race problem is getting worse. And now, it`s worth asking whether
Ron Paul`s race problem is starting to feel like the Republican primary
race problem.

Last night on Martin Luther King Day in South Carolina, which was the
last state to sign a bill to recognize Martin Luther King Day as a paid
holiday, there were five Republican presidential candidates and there was
FOX News, very pointedly not asking Ron Paul about the fact that he voted
against the holiday recognizing Martin Luther King`s birthday -- also not
asking him about the fact he says he would have voted against the Civil
Rights Act, the most obvious practical legacy of King`s life and activism,
at least in electoral politics.

Ron Paul was against it. And he still is. And FOX News apparently
didn`t want to bring that up on Martin Luther King Day in South Carolina.

But it`s not as if race did not come up at the debate.


JUAN WILLIAMS, FOX NEWS: Speaker Gingrich, you recently said black
Americans should demand jobs, not food stamps. You also said poor kids
lack a strong work ethic and proposed having them work as janitors in their
schools. Can`t you see that this is viewed at a minimum as insulting to
all Americans, but particularly to black Americans?



GINGRICH: Take one janitor and hire 30 some kids to work in the
school for the price of one janitor, they`d be getting money, which is a
good thing if you`re poor, only the elites despise earning money.

WILLIAMS: But, Governor --


WILLIAMS: Speaker Gingrich -- the suggestion that you made was about
a lack of work ethic. And I got to tell you my e-mail account, my Twitter
account has been inundated with people of all races who are asking if your
comments are not intended to belittle the poor and racial minorities. You
saw some of this reaction during your visit to a black church in South


WILLIAMS: You saw some of this during your visit to a black church in
South Carolina where a woman asked you why you referred to President Obama
as the food stamp president. It sounds as if you`re seeking to belittle



GINGRICH: First of all, Juan, the fact is that more people have been
put on food stamps by Barack Obama than any president in American history.



MADDOW: And so, that was happy Martin Luther King Day from the
Republican Party in South Carolina last night. What followed that
exchange, as you`ll see here, a standing ovation -- look. What Republicans
are calling an unprecedented standing ovation in a debate made for a
presidential candidate, doubling down on calling the first black president
the food stamps president in South Carolina. The apparently overwhelmingly
white crowd at that debate lustily booing a black journalist for asking
questions about the food stamp president comment, about a white candidate
questioning the work ethic of poor people and black people, and about
frankly, the overarching theme of the way that candidate has talked about
black people in his rhetoric campaign. Lustily boos for the black

So, that was last night in South Carolina. And then at midnight last
night, the "New Republic" published yet further excerpts from Ron Paul`s
old racist, conspiratorial newsletters. His newsletters have been around
for a long time. But because they weren`t distributed electronically, they
were mailed out, the process of collecting them and digitizing them and
getting them online has meant that the excerpts have sort of come out
slowly in dribs and drabs over the years.

We have previously seen excerpts, like this one, where somebody
purporting to be Ron Paul, writing in Ron Paul, first person voice, under
Ron Paul letter head, but who Ron Paul now says definitely wasn`t him
passes on advice about using an unregistered gun and wiping your
fingerprints off it if you use the gun to shoot a menacing black youth.

The new batch of news letters released by "The New Republic" last
night includes this, quote, "We don`t think a child of 13 should be held as
responsible as a man of 23. That`s true for most people. But black males,
age 13, who have been raised on the streets and who have joined criminal
gangs, are as big, strong, tough, scary and culpable as any adult and
should be treated as such."

Ron Paul newsletters also advocated for a whites-only homeland in
South Africa. The newsletters also said that, in this country, young black
males are trained as children to steal and loot as much money from the
white enemy as possible.

It`s one thing to campaign on the issue of racial division as Newt
Gingrich did today, putting out an ad congratulating himself for his race
comments last night. It`s another thing to have this kind of racist
baggage dragging around behind you like Ron Paul does, as much as he tries
to distance himself from these newsletters.

The fact is there is a ton of this baggage stretching over a big swath
of his public life and it`s going to keep coming out in dribs and drabs as
people stop being too disgusted in reading it to pause to upload it.

But whatever that means for the national contest of running for
president, in South Carolina, it does mean one very specific thing. In
South Carolina, race and party are getting very, very close to each other.

African Americans make up about 25 percent of the voting population in
South Carolina, or at least they did in the general in 2008. But in the
Republican primary in South Carolina, in 2008, 2 percent of the vote was
cast by African Americans. And in a state where John McCain`s margin of
victory was nine percentage points overall, John McCain`s overall margin of
victory among white voters in South Carolina was 47 points.

We talk a lot about politics and race. But sometimes, it feels like
politics blurs into race.

Joining us now is the host of "POLITICS NATION" here on MSNBC, the
Reverend Al Sharpton.

Reverend Al, nice to see you.

AL SHARPTON, "POLITICS NATION" HOST: Nice to see you, Rachel.

MADDOW: Is South Carolina -- does South Carolina have a different
calculus about race and politics than the rest of the country or is it sort
of the same everywhere?

SHARPTON: Well, I mean, you have problems of race everywhere in
different levels of expression. But clearly, South Carolina which is a
state who tonight the state capital still has the Confederate flag flying
over it, has a real insensitivity to race -- the Confederate flag is on the
official capital grounds. When you look at the fact that the problem of
race expressed with voter suppression, voter ID, a lot of policies, when
you look at last night, how they actually cheered this kind of racial
demagoguery that Newt Gingrich came with and booed this black journalist,
Juan Williams, a black conservative, on FOX.

This wasn`t Al Sharpton. This wasn`t a civil rights activist. You
clearly get the picture that Gingrich and others are playing to an element
they believe to be there.

MADDOW: They know that the -- if the 2008 electorate is anything to
go by, they know that in the Republican primary, they are thinking about
something, you know, a 2 percent black vote. They know essentially no
black voters that they have to persuade in the Republican primary.

Black people in South Carolina by and large are not going to vote in
that primary. But what they say and how they message on race, in order to
lock up as much as they say of the white vote in South Carolina in that
Republican primary, does it travel? Does it drag around behind them and
affect the way that they can appeal to voters of all stripes when they go
on to other states?

SHARPTON: Oh, absolutely, because I don`t think that the American
public at large and particularly the independent voters that they will want
to attract in November against President Obama wants to identify with this
kind of rhetoric, and behavior.

When you look at the fact that this is blatant, this is not subtle,
this is not some inference. You`re talking blatant.

Newt Gingrich says black people -- I want black people to stop asking
for food stamps. Not I want people, which he could clearly say. The
majority of people in the country in America getting food stamps are white.

He doesn`t say I want people to get jobs. I want black people.

Ron Paul`s newsletters are geared toward black people. This is very
blatant, very specific.

So, it`s not somebody saying, oh, you`re pulling the race card. They
are labeling that, they are saying that overtly and this is poisonous.
What is most disturbing, though, is not one person on that stage said, I
differ. I think that`s wrong, I think that we cannot have a party like

They all stood there in their silence was consent to this kind of
behavior, including Mitt Romney.

MADDOW: Can you imagine the blood curdling screams from the crowd had
any of them done that? I mean, imagine if Mitt Romney had stepped in and
actually, you know, Newt, you`re wrong in that implication, it`s racist and
inappropriate for our party -- can you imagine what would have happened in
the room?

SHARPTON: They would have been booed and heckled but applauded by
most Americans that understand we cannot have that kind of behavior in the
body politic of this country.

And on Martin Luther King Day for them not only not to raise some of
the questions that you raised tonight, but to the exact opposite behavior -
- they started the debate showing the statue of Martin Luther King, the
monument that all of us started our day yesterday in Washington, and then
they do the most anti-King, anti-racial tolerance, anti-bringing American
people together debate that I`ve seen in my lifetime.

MADDOW: What do you make of the fact that Newt Gingrich is really
counting on you being mad at him about this? I mean, when I saw Newt
Gingrich campaigning today, trying to raise money, he cut that exchange
with Juan Williams today, to raise money off it today because he`s so proud
of it.

The only way that ad is going to be augmented by the Gingrich campaign
is if they can cut in some liberals being predictably outraged about that.
They see that as a badge of honor. They say that as something that helps
them with their base and that they can raise money off of.

How do you calculate that?

SHARPTON: Well, that is their calculation, that they are thinking
they are playing to a real element that is so far right and biased that
they will energize them to vote for them. And it should insult white South
Carolinians because they should say, what are you saying about us? And it
is really cynical, because you remember President Obama had Secretary of
Education Duncan, Newt Gingrich and I doing education tour. Gingrich has
been in these communities with me and Secretary Duncan.

He didn`t say that when he was in inner cities with us. He says he
wants to speak at the NAACP convention. He`s spoken at the national

He didn`t mention food stamps one time. He didn`t mention having
children violating child labor laws and becoming janitors one time.

So, pull the tape when he spoke at my convention just two years ago,
none of that was said. This is a cynical manipulation of racial
demagoguery in order to get some votes.

MADDOW: Reverend Al Sharpton, thank you, sir.

SHARPTON: Thank you.

MADDOW: Thank you. Great to have you here.

All right. Don`t forget catch more of the Reverend Al on "POLITICS
NATION" which airs weeknights at 6:00 p.m. Eastern right here on MSNBC.

It appears that somewhere along the way, Republican presidential
front-runner Mitt Romney forgot the value of a dollar or maybe he never
knew -- either way, he does not appear to know now. At least the way that
he thinks about dollar is not the same way you think about dollars.

What that means for the 2012 election is coming up next.


MADDOW: Two election news items today, both slightly mind blowing.

First, a federal appeals court rejected Texas Governor Rick Perry`s
appeal today to try to get his name on the Virginia ballot. An earlier
court ruling, of course, has said that only Mitt Romney and Ron Paul had
met Virginia Republican rules for getting on the ballot in Virginia this
year. Governor Perry and several other candidates appealed the ruling.

But today, the appeal failed.

So the Virginia Republican primary ballot for president this year will
look like this -- Mitt Romney or Ron Paul, Virginia. Those are the
choices. That`s it. That`s one news development today.

Two, is Iowa. Iowa is turning out to be nuts. I am mystified by

Now, Iowa Republicans, as you know, held their caucuses two weeks ago.
It`s not the state of Iowa that holds the caucuses. It`s the Republican

After the results were unimaginable close, just eight votes between
Rick Santorum and Mitt Romney out of 120,000 cast, after that close result,
the nation sort of marveled at the fact that there was no provision for a
recount in that state. The Iowa Republican Party said, OK, there is no
recount provision, but the unofficial results will be made official, they
will be certified as official within 14 days of the caucuses.

Those are the procedures the Iowa Republican Party established and
released five days before the caucuses were held. Within 14 days, see,
says so right there.

Fourteen days from the caucuses is today. So, who won Iowa this year?
We still don`t know. There are still no certified results even today, even
though Iowa Republican Party rules say there are supposed to be results

Iowa Republicans now say that we shouldn`t expect any official results
about who won Iowa two weeks ago until the end of this week. They are
describing that as their goal now.

So maybe they`ll meet their goal and maybe they won`t.

OK, editorial comment here for a moment. If you want to run elections
this shady in your party, I guess you can do that, right? If you want to
accuse everybody else of voter fraud and say how only you can be trusted to
insure election integrity, you can also do that.

But you cannot simultaneously be the guys who run elections this shady
and crow about election integrity. Iowa Republicans, you cannot be both.


MADDOW: For the past few months, we have been calling Mitt Romney Mr.
22 percent. That`s because no matter what he did, no matter how many of
his opponents self-emulated, Mitt Romney, poor guy, could never seem to get
past roughly 22 percent in the polls. It was like an artificial ceiling
that he couldn`t breakthrough no matter what else was going on.

Well, tonight, there is some exciting news for Mr. Romney. And some
sad news for our nickname for him because he is no longer Mr. 22 percent.
Here`s what is happened to Mr. Romney`s numbers recently.

Over the last month, particularly over the past week, it`s been
ceiling be gone. He`s no longer stuck down in the low 20s. Now all of a
sudden, the ceiling appears to be gone, he appears to be clearing 30
percent for the first time.

In the larger picture of this campaign, Romney appears to be cruising.
And if you are the Romney campaign, you are excited to see the ceiling gone
and the poll numbers starting to soar.

But at the same time that Mr. 22 percent is being retired, Mr. Romney
gave his campaign a new number to worry about today. If I were the Mitt
Romney campaign, I`m not sure if I wouldn`t prefer old Mr. 22 percent to
the new guy he just brought on the scene. The new guy he just brought on
the scene is named Mr. 15 percent.


REPORTER: What`s the effective rate you`ve been paying?

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: What`s the effective rate I
have been paying? It`s probably closer to the 15 percent rate than
anything because my last 10 years I`ve -- my income comes overwhelmingly
from investments made in the past rather than ordinary income or rather
than earned annual income. I got a little bit of income from my book but I
gave that all away and then I get speaker`s fees from time to time, but not
very much.



MADDOW: Mitt Romney today explaining that the personal tax rate he
pays is probably pretty close to 15 percent. At the end of there when Mr.
Romney said that his speaker`s fees have earned him not very much money?
What counts as not very much money to Mitt Romney? Is $374, 000, that`s
what he earned in speaker`s fees in one year in 2010.

So, Mr. Romney describing that amount as, quote, "not very much."

And did you hear what he said right after that?


ROMNEY: I get speaker`s fees from time to time, but not very much.



MADDOW: An evil laugh for good measure, perhaps a monocle, how about
a cane? Some wax to twirls the ends of your inky mustache? It`s not very
much money.


The broader issue here, though, is not just the astonishing magnitude
of Mitt Romney`s fortune and what he thinks is funny about it. The
material issue is what Mitt Romney wants for the country and what he`d do
to the country as resident.

The top marginal tax rate now is about 35 percent. That`s supposedly
the tax rate that the richest people in the country pay. But if you`re a
master of the universe financier like Mitt Romney, you don`t have to pay
what other rich people pay. You get a special mini tax rate, 15 percent,
lower than anything else who earns a paycheck in our country.

The reason that the financiers mini tax rate is something that`s
widely known this year, is thanks in large part to billionaire Warren
Buffet. Warren Buffet has attempted to essentially make a national scandal
out of the fact that he, the third richest man in the entire world, pays a
lower tax rate than his own secretary does.

And when President Obama came out with a proposal known as the Buffet
Rule to try to correct that, to try to get millionaires who earn their
money off investments to pay a little more so they are not taxed
substantially less than regular working Joes, guess who said he`d stand in
the way of the buffet rule? Mr. 15 percent himself.

Mitt Romney saying that getting billionaires to pay as high a tax rate
as say their secretaries, he said was the last thing I want to do.

So, welcome not next phase of the campaign, the Mitt Romney`s taxes
phase. Whereupon the nation learns that Mitt Romney`s plan as president
would be for guys like himself to keep paying their special mini tax rate
of 15 percent, while everybody else, your fault for not being a master of
the universe financier getting coddled by the system.


MADDOW: Joining us is Jonathan Cohn, senior editor of "The New
Republic" and a senior fellow at Demos.

Jonathan, thank you for being with us tonight.

JONATHAN COHN, THE NEW REPUBLIC: Thanks for having me.

MADDOW: I hope you will forgive me the evil laugh, I could not
resist. I know you`re more even handed than that.

I don`t think anybody begrudges Mitt Romney for being a super rich
guy. But if he is the Republican nominee does the subject of special
treatment for rich people in the tax code, special treatment for rich
people broadly economically speaking does that move to the center of the

COHN: I certainly hope it does. And let`s be clear why. Again, like
you said, nobody begrudges Mitt Romney making a lot of money. He was
obviously an extraordinarily successful businessman. He made a lot of
money for investors and, you know, he deserves to be well-compensated for

But right now in America, we have a tax code that inexplicably lets
people like Mitt Romney get away with paying lower tax rates than
secretaries and people and sorts of middle class people.

And the crazy thing is, here we have Mitt Romney coming along, not
only does he seem to think that`s OK, he actually wants to make that
imbalance worse. He has put a tax proposal that would give much larger
benefits to the wealthy and actually depending how you calculate it and
implements it you could see some poor people who after this year would see
their taxes go up in the Romney tax plan.

MADDOW: Mr. Romney often gets credit for not being as far to the
right as the rest of the Republican field. I know that you`ve been digging
into his overall economic plan, his overall tax plan. Compared to
something like the Bush tax cut proposals, compared to other familiar
conservative policies -- is he deserving of the credit for not being that
far right?

COHN: I don`t think he is. And I think, you know, for me, the
current benchmark for what I would consider a really dangerously radical
proposal to downsize the government is the Paul Ryan budget, what Paul Ryan
proposed that came out of the House Budget Committee.

You may recall there was a lot of controversy over it and there should
have been a lot of controversy over it. He was talking about draconian
cuts, a lot of them would have gone in Medicare. And, frankly, you would
have ended up in a situation where you have senior citizens who couldn`t
pay their medical bills. And all sorts of problems like that, not just for
the poor but middle class.

Well, if you look dollar for dollar and you look at Romney has thrown
in the table, and he`s proposed a spending cap and you look at the number
of dollars he wants to take out of the federal budget, he actually wants to
take more money out of the budget than Paul Ryan did.

Now, he hasn`t said exactly how he would do it but one way or another,
you are going to see huge cuts to programs like Medicare, like Medicaid,
and it`s not just the social services we`re talking about. We`re talking
basic functions of government here.

Do you like the FDA inspecting drugs for safety? How about the
Centers for Disease Control? How about the FBI? How about roads?

Well, some combination are going to get massive cuts, if Romney were
to become president and get to implement his plan.

MADDOW: Mr. Romney in political terms has said that any criticism of
his time at Bain Capital and what he sees as criticism of his own wealth is
just a function of envy, that people are jealous of him and that anybody
using that in political context is essentially fuelling class warfare, is
there a flip side to that in terms of what he is offering overall in terms
of an economic package? Is Mitt Romney offering to make the 1 percent
problem worse, or even in his own terms, does he think that he might make
income and equality better, whether or not people agree with his plans how
to get there?

COHN: Look, capitalism, people uses this phrase creative destruction.
It`s a messy process. There`s competition and people are going to feel the
effects of that. And I think we all understand that. It`s part of the way
the free market works. It`s how you create more wealth.

But the question is, what do you do about that? And that`s really
what`s so troubling about Mitt Romney. He doesn`t seem to appreciate the
fact that if you`re going to have an economy where people sometimes lose
their jobs, where they can`t pay their bills, then someone`s got to step in
and say, look, if you lose your job, we`re going to take care of you, we`re
going to make sure you get unemployment benefits. And you know what?
We`re going to make sure you can`t lose health insurance and we`re going to
make sure you have good public services.

Romney isn`t just saying we should have a free market, he`s saying we
should have a free market and if people suffer, if they lose their jobs, if
they`re -- well, you know, that`s just too bad.

MADDOW: Jonathan Cohn, senior editor of "The New Republic" and a
senior fellow at Demos -- Jonathan, it`s great to have you here tonight.
Thanks for being here.

COHN: Thanks for having me.

MADDOW: Right after this show on "THE LAST WORD" with Lawrence
O`Donnell, the latest on the cruise ship disaster off the coast of Italy.
One of the most compelling pieces of audiotape you will hear this or any
other year. I have heard it today. It`s remarkable.

And here, what`s going on with the Internet tomorrow? Plus, some
breaking news out of the White House, and tonight`s best new thing in the
world -- all coming up.


MADDOW: There`s breaking news from and about the White House tonight.
Although the details are extremely sketchy right now, the White House is
reportedly on lockdown tonight after what are described as smoking objects
were found near the north portico. According to the U.S. Secret Service,
somebody threw a smoke bomb-like device over the north fence at the White
House earlier this evening. They do not know who threw the device and no
arrests have been made.

Now, the president and first lady were not at the White House at the
time of the incident. They were out to dinner tonight in Washington,
celebrating Mrs. Obama`s birthday.

We will update this story as we can, but that`s all we`ve got for
right now. We`ll be right back.


MADDOW: We`ll be right back.


MADDOW: At least 7,000 Web sites are going dark tonight at midnight,
including one of the most heavily trafficked sites on earth, Wikipedia.
The pioneering and hugely popular user generated online encyclopedia of
everything will be among the most visible participants in what looks to be
the biggest online protest ever conducted.

Google is not expected to go dark, but they are expected to put
information about the protest, including how you can support its cause on
the home screen. Other sites like my favorite blog, are going dark, as is the very popular, as is the
picture-sharing service TwitPic, although Twitter itself is expected to
stay live.

The cause of all the consternation is SOPA, the Stop Online Piracy
Act, and its companion legislation, the Protect I.P. Act. I.P. as
intellectual property. Both bills are designed to crack down on content
theft on the online illegal trading of copyrighted material.

Its opponents including most of the great and good of the Internet
machine say it will essentially make the Internet government-controlled.
It will allow for the direct blocking of Web sites said to be trafficking
in pirated material and other sites that link to any suspect sites, thus
putting every web content provider in the very un-web ethos position of
censoring not only what they upload, but what they link to and potentially
even what they describe.

And so, mass Internet blackout protest for 24 hours starting at
midnight tonight.

When the White House this weekend put out a statement saying the Obama
administration, quote, "will not support legislation that reduces freedom
of speech, criticizing elements of the proposed law while still
acknowledging intellectual property theft as a serious problem, that was
largely viewed as a wrench in the works for SOPA moving ahead.

But the law`s opponents are still worried that it`s in process.
They`re still worried about its sister legislation PIPA and going ahead
with their online show of force.

For those of who basically live online, like I do, tomorrow`s going to
be a very different day than I`ve ever seen before -- kind of like me doing
this whole segment like this, with basically zero graphics and things
randomly blinking on and off around me that I can`t explain.

Now, it`s time for "THE LAST WORD" with Lawrence O`Donnell.


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