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All In With Chris Hayes, Thursday, May 2nd, 2013

Read the transcript from the Thursday show

May 2, 2013

Guests: Dan Baum, Elijah Cummings, Angela Maria Kelley, Eliot Spitzer, Jim Carr

CHRIS HAYES, HOST: Good evening from New York. I`m Chris Hayes. And
thank you for joining us.

After a huge step forward on women`s rights, a giant leap backwards
today. I will explain.

A sigh of relief for struggling homeowners -- I will tell you the good
news, which is rare.

And the best description of matrix you will hear in #click3.

But we begin tonight at the ballroom of this Houston, Texas hotel. In
the last hour guests have been streaming in for a banquet in auction that
kicks off the National Rifle Association`s annual meeting and exhibition.
Attendees have already been treated to antique guns and gold showcase where
National Firearms Museum were doling out free appraisals of all guns and

Still to come, over the course of the four-day event, they`ll be
treated to speeches to such luminaries as FOX News host Sean Hannity, who
is apparently the keynote speaker at tomorrow`s women leadership forum

Then, at the main leadership forum, a lineup that includes Sarah
Palin, Texas Senator Ted Cruz (AUDIO GAP), Texas Governor Rick Perry and
Rick Santorum. And book signings by Oliver North, former U.N.-hating U.N.
Ambassador John Bolton, Rick Santorum, Ted Nugent and, of course, the one
and only Glenn Beck.

His Saturday night stand and fight rally is already sold out, and
offering up overflow seating with discounts for multiple ticket purchases.

If you`re going to create a Venn diagram to see where right wing
culture and gun culture overlap, it would look just about like this. Right
now, the right wing gun culture in the person of the NRA is sitting in the
grand ballroom of the Hilton America`s Houston Hotel, maybe sipping

And we don`t know what they`re talking about. But we do know what
they have, that they a lot to celebrate, because they have good cause to be
really psyched right now.

For one thing, they just beat back a massively popular but tiny
expansion of background check rules for gun buyers.

Now, Democrat Joe Manchin says he`ll bring that bill back. He`s
convinced he`ll ultimately get it through the Senate and President Obama
tonight in Mexico, he says, we`re going to keep trying. And we told you
about the handful of Republican senators whose approval ratings have
suffered since their votes against expanding background checks.

But that`s all part of the battle the NRA is accustomed to fighting.
That`s part of the game.

The folks in the grand ballroom right now, it`s not their poll
numbers. No. They`re going to keep selling and enjoying and promoting
their guns, which is something they`ve gotten very good at. Case in point,
there`s an ammunition shortage in this country right now because the demand
and desire for guns and ammo is so high. Gun sales are up, up, up and gun
manufacturers` profits are surging accordingly.

The gun lobby has been pushing ahead with really brash laws in the
states outside the difficult area of national politics.

Just today, Attorney General Eric Holder released a letter he sent to
the great state of Kansas, informing the state that its new law declaring
the federal government`s authority to regulate guns, ammunition and
accessories in the state null and void is, in fact, unconstitutional.
Before the ink has dried on that warning letter to Kansas, Republicans in
neighboring Missouri are moving on their version of that same state law
declaring the federal government powerless to regulate guns within its

So, certainly from a politically competitive standpoint, I think the
people assembled in the Hilton Grand Ballroom tonight have got to be
feeling pretty good. And I should say, I`ve been around movement
organizers my whole life, I know what it`s like to fight battles and win
victories. You got kind of a rush afterwards. It`s very satisfying.

And that`s why I think it`s this people sitting in that ballroom right
now, as we speak, you should spend time tonight, and tomorrow and all
through this conference, thinking about and talking about Caroline Sparks.

Caroline Sparks is a 2-year-old Kentucky toddler accidentally shot to
death this week by her 5-year-old brother. Not with a gun the 5-year-old
just found laying around somewhere, with his own gun.


REPORTER: According to the Cumberland County coroner, little
Caroline`s brother was playing with his cricket rifle yesterday when it
fired, striking and killing his little sister.

UNIDENTIFIED MALE: It`s tragic. It`s something you can`t prepare

REPORTER: The children`s mother was at home at the time cleaning, the
coroner tells me. He says she`d only stepped outside for a minute or two
when she heard the shot. The gun, the coroner says, was kept in what the
family considered to be a safe shot.

State police are investigating.

UNIDENTIFIED MALE: Yes, it`s been rough since yesterday, been more
than I can handle, it seems like.

REPORTER: It`s all still sinking in for the family, though they say
they`re comforted knowing the 2-year-old is in a better place.

UNIDENTIFIED FEMALE: I just know she`s in heaven right now and she`s
in good hands with the Lord.


HAYES: I have a young daughter. So, I can only imagine what Caroline
Sparks` parents must be going through right now.

I don`t know them and I don`t want for even a moment to judge them.

They are in a small instance part of a broader gun culture that is
relentlessly stoked, supported and prodded and pushed by the gun industry
and the NRA -- the folks sitting in that ballroom in Houston right now.
And that`s a culture that they tell us, every time we tried to have a
political discussion about the guns, that we need to respect as if it`s a
religion that we should thread carefully around.

Now, guns are part of our culture. But that`s a culture that even
seems to embrace this.


UNIDENTIFIED BOY: Where are you going?

UNIDENTIFIED BOY: To shoot my new Crickett rifle.

UNIDENTIFIED BOY: I wish I had one.

NARRATOR: My first rifle, a moment you will never forget. Girls and
moms will love one to pick to their own taste. Start your own tradition.


HAYES: That`s a gun designed, manufactured and marketed for children.
That`s the kind of gun that Caroline Sparks` 5-year-old brother was given
as a gift last year and accidentally shot and killed her this week.

We don`t manufacture or market alcohol for children or steak knives or
cars or cigarettes or jugs of liquid Drano. But, apparently, we`re all
supposed to be OK of gun companies designing and marketing deadly weapons
for kids because that`s part of this culture, introducing them to guns
early on, passing on this sacred tradition.

When I read the story of Caroline Sparks, I have to say, I`m not part
of gun culture. And I really do try to be open-minded as we have this
policy conversation across a vast country with deficit habits and norms and

But there is something dark at work here something folks that are part
of gun culture should be talking about. If gun culture is going to be the
foundation for the kind of politics we have, which broke (ph) no regulation
at all, even when that regulation is designed to safeguard the lives and
limbs of gun owners themselves. If the politics are the result kind of
culture that says it`s OK to give a 5-year-old a gun -- well, then, I`m
sorry, we need to talk about this culture. It can`t be the elephant in the

And the people who need to start that conversation, to own that
conversation, about what gun culture is and what it should be are the
people who are part of that culture, the folks who right now as I`m
speaking to you may well be sipping cocktails and celebrating victories in
the grand ball room of the Hilton in downtown Houston.

Joining me tonight from Santa Fe, New Mexico, author and journalist
Dan Baum. His most recent book is "Gun Guys: A Road Trip."

And with me at the table, Congressman Elijah Cummings, Democrat from

I want to begin with you, Dan. You wrote this great book. You are
someone who owns guns. You and I have had conversations about gun culture.

And I guess I want to get your reaction to what I just said because --
there`s -- here`s how I feel having this conversation. I feel everybody
has to -- everyone who is a liberal who doesn`t own a gun is in this weird
defensive crouch that they have to apologize for not being part of gun
culture and tipping their head that they understand gun culture is an
important thing.

I want to say, look, guns are destructive things that do a lot of
damage. I think it`s fine to come into the conversation with some real
skepticism and trepidation about how they`re regulated and managed.

DAN BAUM, AUTHOR: Yes, that`s fine. I would take issue with the
highly disrespectful tone you`re taking. I`m with you on the merits,
Chris. And my heart goes out to the Sparks family.

But I got to say, I started shooting when I was 5. I started shooting
a .22 rifle when I was 5. Teaching young children to shoot can be
disciplining, it can be mind-calming, there`s hand-eye there. There`s
family tradition.

Teaching young children to shoot, I think, is a good thing. What is
not a good thing is letting children have access to those guns all the

HAYES: But --

BAUM: I`m beating this drum all over the place.


BAUM: We gun guys have proven ourselves to be victim family lousy
stewards of the nation`s civilian arsenal. We do a very bad job of locking
up our guns.

And our guns need to be either on our hips, in our hands or locked in
a safe, because if every gun was locked up, if gun guys got serious about
this, no child would be finding a gun and shooting his little sister with
it. No depressed teenagers would be finding guns.

Adam Lanza would not have gotten his hands on guns. Thieves would not
get guns.

This is really up to us. I have been arguing with gun guys a lot,
especially since my book came out, that we need to do a better job
ourselves of doing this.

HAYES: That`s a really interesting --

BAUM: What we want is to be safer. We all want to be safer.

HAYES: Yes, agreed. That`s what we all want.

BAUM: We want to be safer among all these guns. And, quite frankly,
when you get on your soapbox and start making these angry comments about
gun culture, you`re not really doing us any favors, Chris, because you
drive the gun guys into this, as you put it, a defensive crouch.

They really don`t want to listen.

HAYES: But, Dan, OK -- I know that. But here`s the thing. They are
the in that defensive crouch already.

See, this is the thing that drives me crazy.

BAUM: Yes, they are.

HAYES: Barack Obama went through four years, he signed one gun bill.
That gun bill was to expand the ability to carry guns in national parks.
That did nothing about the conversation or people not feeling paranoid.
Then there`s like --

BAUM: I`m with you -- yes, you are right, Chris.

HAYES: So, look --

BAUM: Both sides -- both sides here have a lot to answer for.


BAUM: I`ve got to tell you, since my book came out, since "Gun Guys"
came out in March, I am getting five or six e-mails a day from gun guys who
say, right on, man, I don`t like the NRA either, because I can`t stand the

And you got to remember, the NRA has 4 million members. And there`s
probably 100 million gun owners in America.

HAYES: Right.

BAUM: And even allowing for a lot of gun owners who maybe support the
NRA, but don`t actually pay dues, that`s still a small minority. There are
a lot of gun guys out there who supported background checks, who lock up
their guns, who are responsible, who are horrified by Sandy Hook and the
Sparks family, as you are.

HAYES: Congressman, I want to --

BAUM: The NRA sucks all the oxygen out of the room.

HAYES: Congressman, I want to talk to you, gun culture looks very
different depending on where you are in this country.


HAYES: What your experience -- you had a personal experience of gun
violence that is very different than maybe the joyful experience of being
taught to shoot as a 10-year-old boy.

CUMMINGS: Yes, my nephew, Christopher Cummings was killed, shot to
death at 5:00 in the morning, somebody burst into his apartment at Old
Dominion two years ago, and shot him and killed him. As I was listening to
your guest, I could not help but think about a few days later when I went
to see his room, there was blood splattered all over the walls and matter
from their brain on a wall is not a pretty picture.

You know, he talked about guns and children. In the inner city -- I
live in the inner city, the young people -- I`ve been in the same house 32
years, the young people in my neighborhood, 15, 16 year-olds tell me they
can get a gun faster than they can get a cigarette, if they have the money.
That`s the problem. These are people with no training.

As far as the young lady, Caroline Sparks, my heart goes out to that
family, it really does. Because those are parents who have lost a child.
Believe me, every time a birthday comes up, graduation, whatever, they`re
going to be mourning for that child.

And, by the way, I think a lot of people have disregarded the passion
that`s built up in people who have losses.


CUMMINGS: In other words, like the inner city. But that passion is
great. They will live with that until they die.

HAYES: Dan, I want to come back to you as we talk about this culture
conversation and policy conversation and the thing you just said, I get it.
Is there, right now, the way gun culture is channeled into the political
organization is through the National Rifle Association and organization to
its right, which is Gun Owners of America.

My question is, is there a space, if cable news yappers like myself
would just shut up and not get on the soapbox, is there a space for gun
owners organization that was to the left of the NRA? That was -- I mean, I
don`t want to even put -- but had a view about this, that organize people
that are 100 million folks who do have guns in their homes, that said, yes,
we should talk about sensible regulation. We should talk about how we can
work together to make guns more safe.

Is there a space for that? It seems the culture is so paranoid and
dug in right now, there is not.

BAUM: I think you`re right. I think there is room for that. I have
a piece coming out in "Harpers" next week where I address this very

I mean, the NRA didn`t used to be like this. You know, the NRA got
taken over in 1977 by these people. Before then, it was a marksmanship and
safety organization. And it was turned in 1977 into this political blunder
bus that is so destructive to the country. I think it`s very destructive to
the gun-owning community. It`s awful.

Yes, I think there is a place for either taking the NRA back or
forming a new organization.

CUMMINGS: I agree with you.

HAYES: Congressman, please.


CUMMINGS: I agree. I think there is -- I think there is a space. I
really do. I think there is a space. I think that space is for people
like the folks that he talked about a few minutes ago, the people who may
be a part of the NRA saying -- or associated with it but saying, you know,
I really don`t like all the things they`re doing, those are the people that
need to speak out.

HAYES: Right.

CUMMINGS: And not on behalf of the NRA but on behalf of our country.
We`re better than this.

HAYES: Right . Dan --

BAUM: I am totally with you, Congressman. Totally with you.

HAYES: Dan Baum is author of "Gun Guys". I really like talking with
you, Dan. Thank you for coming on.

Congressman Elijah Cummings, we will see you later in the program on
another story that`s very close to your heart you`re doing a lot of great
work on.

President Obama going full steam ahead on what might be his best
chance of passing one of the cornerstone policies of his second term. And
that is next.



getting this done because it`s the right thing to do. We`ve seen leaders
from both parties indicate that now is the time to get comprehensive
immigration reform done. And part of what we discussed is the importance
of getting it done precisely because we do so much business between our two


HAYES: President Obama is in Mexico this evening, his fourth trip
there as president. But it`s his first meeting with Mexico`s new
president, Enrique Pena Nieto. The two men talked economic cooperation
between the two nations, and the future of U.S./Mexico security
partnerships specifically focusing on the drug war.

But as you just heard, not surprisingly, immigration reform seems to
be the main reason for the president`s visit to Mexico. And after a defeat
of gun control and a little to no progress on a grand bargain solution to
easing the national debt, immigration reform may be the president`s best
hope for getting a key second term agenda passed.

Still, it`s a moment of peak precariousness for that proposed
legislation. Senator Marco Rubio, may be the most influential
congressional Republican on immigration, out there telling conservative
audiences that the 800-plus page immigration bill he helped craft likely
won`t pass the Republican-led House.


SEN. MARCO RUBIO (R), FLORIDA: The bill that`s in place right now
probably can`t pass the House or has to be adjusted, because people are
very suspicious about the willingness of the government to enforce the laws
now and in the future given our experience with immigration in the past.
That is a very legitimate suspicion. It`s one that I share and if there`s
anything we can do to make it tighter, to improve -- to ensure that the
laws are enforced, so we don`t have this problem in the future. You know,
that`s exactly what we should be working on.


HAYES: There are those to the right of Rubio calling the bipartisan
bill Rubio`s folly and Obama-care redux, perish the thought.

And there are those on the left who contend that the bill excludes too
many immigrants who either enter the country illegally or overstayed their
visas, and makes it too hard for the rest to become. This prompted the
president to sit with some liberal supporters this week in the meeting "The
Washington Post" described this way. `In a private meeting with a dozen
Latino leaders in the White House this week, the president made clear he
expected the people in the room to support the senate proposal even if they
had doubts about some details. Once an overarching bill was locked in by
Congress, Obama told the group, the administration would be able to revisit
some of their concerns and figure out ways to improve it."

Perhaps the thing that liberals like myself most object to has to do
with the Mexico-U.S. border because the bill is currently constructed, it`s
all the good stuff like say, a pathway to citizenship is tied to increased
border security.

Right now, before anyone`s legal status is examined, the government
shall include the temporary authority to construct fencing, installing
double layer and triple layer fencing, to increase ground based mobile
surveillance systems, to deploy additional unmanned aerial systems and
manned aircraft -- that`s drones there -- sufficient to maintain the
continues surveillance of the southern border.

Knowing this, President Obama still said that his priority is to get
some kind of immigration bill passed even if it doesn`t have everything he


OBAMA: We can have arguments about other elements of this as we go
further. But what I`m not going to do is to go along with something where
we`re looking for an excuse not to do it, as opposed to a way to do it.


HAYES: Joining me tonight from Washington, Angela Maria Kelley, vice
president of immigration policy at the Center for American Progress.

Angela, how important is Mexico`s role in this? I mean -- and how
important is the border? Because what we end up sort of focusing on is the
border. The border has this symbolic import to conservatives, and yet
we`ve seen an amount of spending on the border, around $18 billion a year,
that`s unprecedented. We`ve seen deportation. And we`ve also seen a
decline in immigration end.

So, what role does the border plain this whole picture?

important to Republicans. That`s why you see Marco Rubio talking about it
as much as he does.

Yes, border security is a national priority but it is a perennial
priority. We`re not going to be -- not able to declare mission
accomplished, that we`re done at the border. So, we need the technology.
We need the resources, of course.

But at the same time, we have to get realistic about the fact we have
11 million people here without papers. And what`s good about the
legislation is that it does directly deal with them, and it puts forward a
process for them to come forward, to be able to work legally, to be able to
pay taxes, and over time, to acquire citizenship.

As far as I`m concerned, both of those goals should and must be met.
And I think the bill is getting us in that direction.

HAYES: One of the intended consequences of previous efforts to
increase security at the border has actually been a perverse incentive for
people to actually immigrate illegally, because previously there were
people who were able to pass back and forth fairly routinely and come back
to work and then to their families. Once that border fence is up, border
crossing becomes a bigger risk.

Why isn`t that going to be the case going forward in the future if we
just keep putting more resources towards border security?

KELLEY: You`re absolutely right. But doing just the build up at the
border, what we`ve done is we cut off the circularity, so that people do
come and they stay and their family members stay. And that`s why we have
two-thirds of the undocumented have been here for 10 years or longer, and
they`re not going home because they are home.

So, what we need to do to make sure a system will work in the future
and not facing this problem 10 years down the road, is to look at what is
our workforce need, how many visas do we need? What would make sense in
terms of the kind we have in the future?

Like right now in the United States, for example, for low skilled
workers, people who work as nannies, who take care of my grandmother, who
work in restaurants, there`s only 5,000 visas a year, for the entire

HAYES: Right.

KELLEY: That`s lunacy, that we have an immigration system so rigid
and so inflexible. This is what I think is smart about the bill that`s
going to be considered next month or this month in the judiciary committee,
is that for the first time it will set forth a commission, a bureau, that
will be made of economists, of demographers, that will look at what is it
we need, in terms of folks coming in the future? What sort of jobs are
going to -- where we`re going to have openings and how many workers are
going to need to fill that?

And then based upon that, set these limits. It`s a very smart
decision and it was an agreement that was reached interestingly enough by
the Chamber of Commerce and AFL-CIO. You have labor and business reach
across the table and shake hands on this.

HAYES: And a lot of people are shaking hands on this. Pena Nieto
wants to see this passed, President Obama wants to see this passed,
business leaders want to see it passed. What remains to be seen is whether
the base of the Republican Party, which does not want to see it passed, can
be activated to kill it.

Angela Maria Kelley of the Center for American Progress, thank you so
much for coming on tonight.

KELLEY: Thank you.

HAYES: You say the words 14 year olds and pregnant and our politics
go haywire. But there is no need to fear doing a right thing on birth
control. I`ll explain after the break.


HAYES: Remember back in April when a federal judge ordered the Obama
administration to make plan B, a form of emergency contraception available
to women of all ages over the counter. This after Health and Human
Services Secretary Kathleen Sebelius, in a truly unprecedented move, hadn`t
been done before, had overruled an FDA recommendation to do just that, make
it available until over the counter.

Well, the administration had until this Sunday to comply with that
ruling, and on Tuesday, with the deadline looming, the FDA announced it
would be lowering the age limit to purchase Plan B from 17 to 15, and
making the pills available over the counter in drugstores but left wide
open the question of whether or not the administration would be appealing
the April ruling or carrying out the judge`s orders to make it available to

Yesterday, we found out when the Justice Department announced it would
be appealing, arguing the court`s ruling undermines the regulatory
procedures governing FDA`s drug approval process.

It`s an interesting position considering that is precisely what the
Obama administration itself is accused of doing. President Obama also
seemed to lose sight of that fact today when he said this.


the FDA may now be called upon to make further decisions about whether
there`s sufficient scientific evidence for girls younger than 15. That`s
the FDA`s decision to make. That`s Secretary Sebelius` decision to review.
But I`m very comfortable with the decision they`ve made right now, based on
solid scientific evidence.


HAYES: The only problem with that is the FDA already made its
decision about women younger than 15 based on solid scientific evidence,
saying it should be available to women of all ages. This was not lost on
the Center for Reproductive Rights, the party in the lawsuit, who said
yesterday "we are deeply disappointed that just days after President Obama
proclaimed his commitment to women`s reproductive rights, his
administration has decided once again to deprive women of their right to
obtain emergency contraception without unjustified and burdensome

And Planned Parenthood, who applauded the administration`s lowering of
the age from 17 to 15, but added, "we continue to believe that access
should be expanded further. Age barriers to emergency contraception are
not supported by science and they should be eliminated."

Now, as we have said on this show before, the administration`s
position on Plan B is simply bad policy. We rely on the FDA to make
scientific judgements and decisions on the safety of drugs for a reason.
We do not want these decisions to be politically compromised, not by this
administration and certainly not by the next.

Just take a second and ask yourself if you want Sarah Palin reaching
into the FDA to tell them what drugs should and should not be over the
counter. And as Judge Corman noted in his April ruling, it`s also common
practice for the FDA to allow a drug over the counter with a warning it
should not be taken by people younger than a certain age. In fact, he said
that Secretary Kathleen Sebelius` edict reflected either her lack of
familiarity or willingness to ignore previous FDA policy.

Aside from this, Plan B simply is not unsafe. Let me repeat, Plan B
is not unsafe. But from the beginning, this has been viewed as political
by the administration who originally announced the decision during the heat
of an election year. The thinking went that they simply didn`t want to
pick a fight on the dangerous ground that is teenagers having sex, knowing
that when people hear the words 14-year-old and pregnant together, they get
uncomfortable, the president included.

He invoked his two daughters when throwing his support behind
Secretary Sebelius` decision.


OBAMA: As the father of two daughters, I think it is important for us
to make sure that we apply some common sense to various rules when it comes
to over the counter medicine.


HAYES: Just last week I was standing here saying the president was
right to lean into the culture wars, to embrace the fact that Democrats do
not have to be in a defensive crouch on these issues. They can make an
affirmative case and they can be with the majority. Like, for instance, on
access to birth control, which, to be absolutely clear, is what we`re
talking about. Plan B is birth control.

Mr. President, making Plan B available over the counter to women of
all ages is right in the merits. Just last week, you made the genuinely
gutsy decision to become the first sitting president in history to speak to
Planned Parenthood, saying this.


OBAMA: As long as we`ve got to fight to make sure women have access
to quality affordable health care, and as long as we`ve got to fight to
protect a woman`s right to make her own choices about her own health, I
want you to know that you have also got a president who is going to be
right there with you fighting every step of the way.



HAYES: What you were saying during that powerful speech is, I
understand who got me elected and I am with you. In this decision to
appeal, it looks like you are taking that back. Don`t take it back, Mr.
President. You were right the first time.

We`ll be right back with Click Three.


HAYES: This man is a beacon of hope in the sea of misery where
underwater homeowners reside. I`ll tell you who he is and why he
represents such good news for people who are used to getting screwed,
that`s coming up.

But first, I want to share the three awesomest things on the Internet
today, beginning with an unbelievable online account of an unfortunate mix-
up. At a meeting of a local women`s group in southwest England, the
Parkam`s Women`s Institute invited Captain Colin Darch (ph) to come speak
at a recent gathering. The topic was piracy.

Members decided to have a little fun with it and come to the meeting
dressed as pirates. You know, swashbuckling fictional variety. The ladies
soon realized that was a mistake, as this headline from the "North Gevin
(ph) Journal" explains, "Parkam W.I Embarrassed By Dressing as Pirates for
Talk by Former Somali Pirate Hostage."

Yes, Captain Darch was captured and held by Somali pirates for 47 days
back in 2008. He wrote a book about his harrowing ordeal and gives talks
on the matter. But as you can see from this photo, Captain Darch was a
good sport about the whole thing. He gave a talk and even agreed to judge
a best dressed pirate contest. "In the end, I decided to choose the one
who had a fluffy parrot on her shoulder. Of course, there weren`t any
parrots near the real pirates."

The second awesomest thing on the Internet today comes from Reddit. A
user posting a video with this description: guy watches "the Matrix" with
his 65-year-old mom who had never heard of the movie. Animation ensued.

The guy in question is Austin based film maker Joe Nicolosi (ph). Mr.
Nicolosi, says he sat down with his mother to watch the 1999 classic. And
afterwards, he asked her to retell what she just saw. Here are some of the


UNIDENTIFIED FEMALE: So anyway, Neil and his girlfriend -- what`s the
girlfriend`s name? Go to the computer, whatever, to set free Moshimo (ph).
What`s his name? Come on.

UNIDENTIFIED MALE: Where kid did you come up with Moshimo?

UNIDENTIFIED FEMALE: What`s it, mustache?


HAYES: In her defense, I will say that explanation made about as much
sense as the sequels.

And the third awesomest thing on the Internet today is a new study out
of Germany that explores the relationship between humans and robots.
Robots are our friends. They dance with us. They move like us. They look
like us. They even clean up after us.

Well, researchers found that when we witness something terrible in the
robot community, like say a robot falling down the stairs, we feel sad. I
wanted to find out more after seeing this headline on "Slate," "Should
Humans Feel Empathy for Abused Robots."

First a warning, what you`re about to see is quite disturbing if you
do, in fact, love robots. Researchers showed this film of a robot being
mistreated to see how much people empathize with robots, as compared to
humans. Participants in the study reported negative feelings while
watching these images. No word yet if any of those participants will seek
justice for this poor guy or whether they were offered this visual palate
cleanser, a cat dressed as a shark, riding a Roomba and chasing a duck, of

OK, I feel better. I hope you do too.

You can find all the links for tonight`s Click Three on our website We`ll be right back.


HAYES: Good news today on the housing front, which is not a sentence
I have occasion to utter very often. A Congressional Budget Office report
announces a rarity, a win-win situation. It is this: mortgage reduction
programs can work not only for the troubled homeowner but for the American
taxpayer. Specifically, the report says offering loan reductions to
borrowers who are underwater on their mortgages -- that means they owe more
than they have in principle -- through HAMP, the Home Affordable
Modification Program, can prevent up to 95,000 people from defaulting, up
to one million underwater homeowners, and save taxpayers up to 2.2 billion

You don`t get a lot of those policy options in life. Usually, there
are a lot of trade-offs. And this is not one of them. This is win-win
win. The underwater homeowner gets help, the banks still their money, and
it saves the American taxpayer money. Now we`ve actually already known
that was the potential for this policy. But there has been a huge obstacle
to implementing that policy. That obstacle is this guy, probably the most
powerful man in America that you may have never heard of, Ed Dimarco. He
is the acting director of FHFA, which you may or may not have heard of.

It used to be Fannie Mae and Freddie Mac until they went under, got
bailed out by the U.S. government and were reconstituted into this new
entity. This new entity that Mr. Dimarco runs owns or guarantees one-half
of all the mortgages in the United States. In fact, as you watch this
right now, if you have a mortgage, there`s a very good chance the entity
Dimarco runs owns your mortgage.

And as the owner of half the mortgages in this country, Dimarco`s FHFA
could be the one to implement the kind of policy that today the CBO said
was such a good idea. But for more than a year now, Dimarco has refused.
Dimarco has argued that he is mandated by law to preserve and converse
Fannie Mae and Freddie Mac`s assets, rather than look out for the entire
housing market.

His attitude is, despite my entity only exists courtesy of the
taxpayer dollar, I refuse to look out for American citizens. Instead, I`m
focused solely on balancing my books.

Here`s the good news, Dimarco is on his way out. And President Obama
wants to replace him with this man, Congressman Mel Watt of North Carolina.
As a member of the Banking Panel, the House Financial Services Committee,
Congressman Watt has distinguished himself by strongly advocating for low
income borrowers, as well as an end to predatory lending. It`s a rare
confluence of good news in an area where the American homeowner is
routinely getting screwed by the banks and often by the people in power in
Washington as well.

We were also given today a reminded of what happens when you don`t do
the right thing, when you don`t give people a break on the principle.
That`s the underlying amount of the mortgage they`ve taken out. When you
don`t discount that price, what you get is the long national nightmare
foreclosure process that has been happening in this country since the Great
Recession. As we have talked about on this show, it has devolved to the
point where banks have routinely and systemically abused the law, doing
crazy things, like foreclosing on homes of people who are not behind in
their mortgage.

I`ll repeat that because it`s so nuts. Banks taking the homes of
people who had made every single one of their mortgage payment, including
United States service members. And we have told you about the paltry
settlement for those widespread abusive practices negotiated by the
government agency, the OCC. On "The Today Show" this morning, Lisa Myers
at NBC News spoke with someone getting one of those measly checks.


LISA MYERS, "THE TODAY SHOW" (voice-over): Timothy Platt, a trucker,
says he`s been fighting to save his home since his servicer made a mistake,
declaring his family behind on the mortgage when they were not. Platt
received a postcard recently saying he`ll be getting a check. He, too,
expects 300 dollars.

TIMOTHY PLATT, HOMEOWNER: It`s kind of like a slap in the face. You
know, we`ve been trying to work through this for three years now. And
we`ve lost lots.

MYERS: In all, 13 banks will pay 3.6 billion dollars to homeowners
under the settlement. The five biggest banks alone earned more than 60
billion dollars last year. The largest payouts, 125,000 dollars, go to
more than 1,000 members of the military wrongly foreclosed on, and to 53
homeowners foreclosed on even though they never missed a mortgage payment.
But most, almost two million homeowners, get checks of 300 to 600 dollars.


HAYES: When we come back, how badly have homeowners been shafted?
What can still be done? And how this nomination by President Obama might
actually help. That`s all next.


HAYES: The ongoing drama of banks screwing homeowners, it`s one of
the greatest stories of the entire Great Recession. It continues to go on.
And we`re sorting out the good news and bad news announced today for
struggling home owners. Joining me at the table, former New York Governor
and Attorney General Eliot Spitzer, former senior vice president for
financial innovation, planning and research at the Fannie Mae Foundation,
Jim Carr, and back with us, once again, Congressman Elijah Cummings.

Congressman, the CBO report that I mentioned there, which basically
said, hey, look, this is what would happen if we could get principle
reduction, which is to actually discount the amount that people owe on
their homes, right --

CUMMINGS: That is right.

HAYES: You asked for that report.

CUMMINGS: I asked them for that report. And the findings were very
clear. The Congressional Budget Office, which is independent, said that
it`s a win-win-win. It`s a win for homeowners. It`s a win for taxpayers.
It`s a win for the economy. They recommended that we do this and it be
done as fast as possible.

HAYES: OK. So the question is, why hasn`t it been done? And there`s
a few theories of this. One is the Dimarco theory of FHFA. But there are
other people who say that it`s the administration. And there`s this famous
quote. This comes from Neil Barofsky`s book about Tim Geithner. He`s
talking about a program that had been created by the administration as part
of the TARP money, right, to help people work through foreclosures. "We
estimate the banks can handle 10 million foreclosures. Over time, this
program will help foam the runway for them."

Meaning, this program is there to make sure the banks don`t take all
the losses at the same time, as opposed to home owners. Who is to blame
for this?

just say this very quickly: all my discussions with the administration,
they claim that they are in disagreement with Dimarco. Yes. So -- and by
the way, Dimarco has -- he put out a report where it seems to say to me
that it showed excellent evidence that we should have principle reduction,
but he went in a different direction.

HAYES: Again, principle reduction, just for folks -- you borrowed
200,000 dollars, right, for your home and the question is -- you`re now
underwater and the home is worth 120,000 dollars -- it`s worth 100,000
dollars, right. Principle reduction means, rather than just lowering your
interest rate or reducing your monthly payments, the bank actually says OK,
fine, we`re going to write down this loan. It`s no longer a 200,000 dollar
loan. It`s a 100,000 dollar loan or 150,000 dollar loan.

CARR: Chris, last year, the administration made it very clear,
directly in a memo from the Treasury Department to Dimarco, indicating they
were fully supportive of principle write-down, and to the extent that they
felt that they would --they, FHFA, would require administrative costs, they
would go beyond the dollar set aside in the HAMP Program and the Treasury
Department would help.

HAYES: Explain all that. Explain what that means, right? So there`s
this program that was actually passed as part of the bailout. It was
called HAMP. They have spent essentially none of the money. Homeowners
have not been helped from this program, by and large.

CARR: A small amount.

HAYES: A very small number, right. So the administration says
whatever you need to do, basically, Ed Dimarco, we`re going to be there for

CARR: We will go beyond the parameters of the program to help you
administratively make this program work, because Dimarco`s -- one of his
push backs was, well, this is an administrative for us, in addition to the
cost to the homeowners, which was kind of odd, since Dimarco`s own
estimates showed that it was a net positive for the taxpayers of a billion
dollars. But the Treasury Department said, forget that; we will even help
you further.

HAYES: Meaning, again, to just return to this point, which is the key
point of the CBO -- it`s the key point of any analysis that`s been done
through the great disaster that this whole thing has been, is that it`s
actually best for everyone, including the banks themselves, if you actually
do the hard thing and say that 200,000 dollar loan, we`re writing it down,
it`s now 120,000 dollars.

don`t believe the administration. Tim Geithner, from the very first
moment, did not stand up once for fundamental reform, either financial
services sector or the mortgage market, the housing market. All he did was
listen to Wall Street saying, give us money. It was OK with him if Wall
Street got all the guarantees, all the bailouts, all the equivalent to
principle reductions they needed. The moment homeowners needed it, moral
hazard was raised.

And understand, the original sin here was that they never should have
given the bailout to the banks absent an agreement for the fundamental
structural reform and the principle write down.

CARR: I agree with the last part he said.

HAYES: The last part of it.

CARR: Yes. We should have had some kind of criteria in there. And
we did not do that. Keep in mind, the other thing, that part of Dimarco`s
mandate is to help homeowners. And by the way, He is legally -- has the
opportunity in the law to do principle reduction and minimize foreclosures.
That`s in the law.

HAYES: It`s in the law. Again, I want to hammer this home to people,
because we`re talking about Ed Dimarco FHFA. There`s this is one dude, OK,
who is presiding over half the mortgages in the country. That is the
situation right now. There is a guy whose name is Ed Dimarco who presides
over half the mortgages in the country.

CARR: I want to make one comment. That was then and that`s true.
The original bailout was flawed because, from the very beginning, the
banks` problem was the foreclosures. If we had dealt with the
foreclosures, we would have dealt with both family problems of bankrupt --
of foreclosures and the bank`s problem of losing money.

But as last year, Treasury was very strident in saying we want this
program to work.


HAYES: We may not be there. But remember, we have an estimate of 2.2
billion dollars from CBO right now. So we`re not even beyond the point
now. But one of the points I want to make out that`s really important is
that that CBO study showed that the more you help the borrower, the more
you actually return to the taxpayer. So the 2.2 billion is on the largest

SPITZER: Add one other dimension to this. To the consent there is
now a consensus the stimulus worked but was way too small, because it did
not provide the Keynesian stimulus we needed, the other piece of this
puzzle was that homeowners were seeing the value of their critical asset
diminished. The economy would have come back dramatically faster --

HAYES: So let`s move forward. So there`s news. Mel Watt -- how do
you feel about Mel Watt?

CUMMINGS: I feel very good about Mel. I think Mel is one of the most
outstanding members of the Congress. He has an excellent reputation. And
what I`m saying -- and he knows how to cross the aisle and work with
others. He has been against predatory lending. He played a major role in
Dodd-Frank. So he is well situated for this job. He sits on in Financial

HAYES: Again, the job to oversee half of America`s mortgages.

CUMMINGS: Definitely prepared.

HAYES: Here`s the question, though: is he going to be confirmed?
Dave Dayan (ph), who is this great reporter who reports on this, who can be
very depressing but I think very clear-eyed about all this, because it`s a
depressing topic, basically said the Senate is not going to confirm this
guy, and this is all a big Kabuki show. What do you think?

CUMMINGS: I think Mel has a pretty good chance of getting the
nomination, getting it. It will be a battle. Don`t get me wrong. You
don`t need all the Republicans. Keep in mind, Senator Burr is already --

HAYES: from South Carolina.

CUMMINGS: From North Carolina. Has already said he supports him.
There`s another thing that people don`t think about. There are a number of
members who have worked with Mel when they were in the House that are now
in the Senate.

HAYES: So there`s some personal relationships.

CUMMINGS: I`m saying to them, if you loved John Kerry and you were so
happy to see him, welcome him to the club.

SPITZER: One last point I would make, I hope he`s confirmed,
obviously. I hope they move forward on principle reduction. Then the big
theoretical question is, what role would the government play prospectively
in guaranteeing mortgages in the housing market. The banks love all the
guarantees they get. The question is, why not also there?

HAYES: We have now -- we have developed a system that was kind of
building the airplane as it was in flight, or repairing the airplane as it
was in flight, in the wake of the Great Recession, where a lot of stopgap
measures have been made, where the government has, basically, a lot of
mortgages on its balance sheet. We`re now basically guaranteeing most of
the mortgages out there.

CARR: Over 90 percent.

HAYES: Over 90 percent are government guaranteed. In the long term,
that -- what has to happen from a policy perspective is to steer away from
that, right?

CARR: Exactly, that`s right. But you want to make sure if you`re
going to bring private capital back to the market, you`re actually bringing
access and affordability with it.

HAYES: And we don`t go back to the bad old days right away.

CARR: Because one of the interesting things, people keep saying bring
private capital back so that we can avoid a taxpayer bailout, but the
taxpayers have been baling out the private sector every time they`ve gotten
to be an oversized --

HAYES: Eliot Spitzer, Jim Carr and Congressman Elijah Cummings, that
was a great conversation. Thank you. That is ALL IN. "THE RACHEL MADDOW
SHOW" starts now with one of my favorite people, guest host Melissa Harris-
Perry. It`s so wonderful to throw to you, Melissa. How are you?


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