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All In With Chris Hayes, Wednesday, July 3rd, 2013

Read the transcript from the Wednesday show

July 3, 2013
Guests: Sharif Abdel Kouddous, Josh Rogin, Noah Shachtman, Avik Roy, Joan

CHRIS HAYES, HOST: Good evening, from New York. I`m Chris Hayes.

What you just heard is the moment today that Egyptian security forces
apparently stormed the studios of Al Jazeera television in Cairo during
what is being called a military coup by the now ousted president of Egypt,
Mohamed Morsi.

Tonight on ALL IN at this hour:

Millions have taken to the streets in celebration, and President Morsi
is reportedly under house arrest. We will go live to Egypt in a moment.

Also, last night, the president of Bolivia was essentially stopped and
frisked in the global effort to capture the NSA leaker Edward Snowden.
Today, that is really not going over very well. We`ll bring you new
details about what went down in that extraordinary story.

Plus, some day I would genuinely love to come before you and do a
story about how the big banks are not scamming people any more. Not for
instance forcing minimum wage workers to pay to get their own paychecks,
but that night is not tonight sadly. My commentary on this latest outrage
is coming up.

But we begin in Egypt, where the military backed by millions of people
in the street has overthrown that country`s first democratically elected
president. A senior adviser to the Freedom and Justice Party and
spokesperson for the Muslim Brotherhood has just confirmed to our reporter
Ayman Mohyeldin that former President Mohamed Morsi has been placed under
house arrest by the Republican guard. In fact -- by the Republican guard
club. In fact, most members of the former president`s team have also been
placed under house arrest.

The day started with a fast approaching dead line issued by the
military on Monday to President Morsi and his Muslim Brotherhood to respond
to the mass protests or risk intervention. But, yesterday, in his last
public address to the country, Morsi was defiant.

Today, military made good on their promise of intervention. This
morning, military forces started to gather around Cairo and around Egyptian
state TV.


REPORTER: This morning, we watched as truckloads of police reinforced
the headquarters of state television. The army`s reported to be inside.
The army denied it had taken control, amid rumors all day that it would
take over the airwaves in a military coup.


HAYES: A Muslim Brotherhood spokesperson tweeted that Egypt was in
the midst of a full military coup. And that came a report from state
newspaper "Al-Haram" that Morsi had been informed he is no longer president
of Egypt.

Minutes later, General Abdel-Fattah el-Sissi announced the military
was suspending the constitution, calling for early presidential elections
and installing Chief Justice Adly Mansour as the interim president.

This was the scene in Tahrir Square following the announcement.


HAYES: President Morsi and his supporters remained defiant throughout
the day. In a statement released to a presidential spokesperson, Morsi,
who is now under house arrest, categorically rejected what he called a
military coup.

NBC News foreign correspondent Ayman Mohyeldin is live tonight in
Cairo with the latest.

And, Ayman, you reported on the house arrest that Morsi has been
placed under. What can you tell us about that?

what we do know is only coming out from members of the Muslim Brotherhood.
No confirmation yet from the Egyptian military or Egyptian police. They
have confirmed other arrests that have been made.

But for the time being so far, it is only the spokesperson for the
Muslim Brotherhood, and the senior adviser to the Freedom and Justice Party
who says that former President Mohamed Morsi has been placed under house
arrest, along with several other members of the presidential team,
including Dr. Essam Haddad, who is senior foreign policy adviser to the
president and a man who`s been to Washington several times and met with
Obama administration officials. He too, we understand, has been put under
house arrest at this time. We`re still working to get an official
confirmation on that from Egyptian security sources.

The Egyptian police, though, have also made the announcement that they
have made some arrests involving senior figures of other organizations.
Organizations that were allied to president Mohamed Morsi and the Muslim
Brotherhood. And more importantly, that both of those pieces of news, is
that their Egyptian police has also shut down the satellite channels of
several affiliated organizations or media organizations affiliated with the
Muslim Brotherhood and other religious parties here in Egypt out of fear
that they may be inciting the crowds in the coming hours.

So, a lot of rapid developments happening here within the last few

HAYES: Ayman, you had the experience if I`m not mistaken, of having
seeing Egyptian security forces coming to our office looking for al Jazeera
journalists. They have cut off the al Jazeera feed from Cairo as well.

MOHYELDIN: That is correct. In fact, a short while ago, I spoke to
some of my former colleague there, and they did confirm to me that the
police did enter the offices of both the al Jazeera Arabic services and al
Jazeera Egypt service and shut those down. Now, they`re still able to
broadcast from their headquarters, they`re still covering this story.

But we understand that within the last few minutes, some of the staff
that had been detained had been released. They`re not allowed to broadcast
for the time being.

Now, the police have not given any explanation why they did this, they
have not given any explanation as to why they are going after these
specific media organizations, but no doubt, there`s certainly something
that al Jazeera has grown accustomed to here, being under tremendous amount
of pressure. Not only in the recent couple of previous years under the
Mubarak administration and under the military rule, but certainly in the
last couple months, they had enjoyed wider freedoms, wider popularity among
supporters of the Muslim Brotherhood, and that is perhaps one reason why
the police this evening decided to act by shutting down those services.

HAYES: NBC`s Ayman Mohyeldin, thank you very much for your time

On the phone with me now from Cairo, where he is based, is Sharif
Abdel Kouddous, correspondent for "Democracy Now."

And, Sharif, my first question to you is -- you just heard Ayman
talking about the serious of actions that read to us in America very much
like a coup, classic coup of shutting down, arresting the opposition, of
shutting down journalistic channels, and yet the images we see on the
screen in front of us, look like mass jubilation.

Is the mood in the streets of Egypt tonight one of jubilation?

describe it as it depends where you are in Cairo, at least. In Tahrir,
near the presidential palace, on many streets of the city, there is
cheering and jubilation across the city.

But there was also at the pro-Morsi sit-in and rally, which is a
different scene, very morose, (INAUDIBLE), and a look of defeat on many
people there. So, I think this is certainly, we have to call this a coup,
but it requires context. It wasn`t a coup that was launched by itself, by
the military, but it was facilitated by popular pressure on the streets.

And the significance of the protests took place on June 30th. The
largest protests in Egypt`s history, is something that forced the
military`s hand to step in. And this is part of this I think rejection of
authoritarianism that we`ve seen in Egypt. First rejecting Hosni Mubarak`s
regime, then the military council that replaced them, and then the Muslim
Brotherhood that was elected. But seemed to act in very much the same
authoritarian way, and just wanted to be more legitimate, that is to say
more freely elected form of the old regime.

But, certainly, if you`re walking in the streets of Cairo, you would
think that this was a new revolution, people are waiving flags, blowing
horns and cheering everywhere you go.

HAYES: Sharif, the question now is, what is next? A caretaker
government was announced. The constitution`s been suspends, early
parliamentary elections, although they have not been announced when it`s
going to happen, that is the road map forward.

In the short term, we know that Mohamed Morsi gave a taped speech to
members of the Muslim Brotherhood urging them not to shed blood. Are there
fears of violence in the wake of the cataclysmic events of the last 48

KOUDDOUS: Certainly. Since June 30th, at least 39 people have been
killed. Five people have died tonight. There`s certainly fears of
violence coming in to the coup. There was a lot of talk from the
brotherhood by Morsi himself in the speech that he delivered last night,
saying he was willing to die, to protect what he calls his legitimacy.

Senior brotherhood members have repeatedly used the Marxism and
shedding of blood to protect their legitimacy. So, with this kind of
language, certainly violence is possible. I think it`s important to
remember when you say what comes next. The key question I think going
forward, you know, we basically have been taken back all the way to square


KOUDDOUS: Back to the point of February 11th, 2011 when the last
(INAUDIBLE) was ousted. You know, the last two and a half years of
election and transition have basically been erased.

(INAUDIBLE) going forward is, what will happen to the Muslim
Brotherhood? Is there any possibility of including them in the political
process? Excluding them, and excluding Islamists broadly will certainly
lead to authoritarianism down the road.

HAYES: Sharif Abdel Kouddous from Democracy Now in Cairo at this
moment -- thank you so much.

KOUDDOUS: Thank you Chris.

HAYES: Joining me now is Josh Rogin, senior correspondent at
"Newsweek" and "The Daily Beast."

Josh, just within the last half hour or so, we have gotten a statement
from the White House, it was the product of a principles meeting that was
called in the Situation Room. I`d like to read part of it to you and get
your take on it.

"We are deeply concerned by the decision of the Egyptian armed forces
to remove President Morsi and suspend the Egyptian constitution. I now
call on the Egyptian military to move quickly and responsibly to return
full authority back to a democratically elected civilian government as soon
as possible, for an exclusive and transparent process and to avoid any
arbitrary arrest of President Morsi and his supporters."

That was statement was, I would say, more disapproving in tone than I
had anticipated. What is your read on that?

JOSH ROGIN, NEWSWEEK/THE DAILY BEAST: I agree with you completely,
Chris. Let`s remember this statement comes after two days of intense
efforts by all parts of the administration, to urge the Egyptian military
not to perform this coup, messages sent both in public and private by
leaders such as General Martin Dempsey, Leon Panetta, Secretary Kerry and
even President Obama himself, urged them to place pressure but not to
intervene to oust President Morsi in this way.

Of course, the Egyptian military calculated that if they did this,
that the Obama administration would have to go along with their action,
that seems to have been the right calculation. And the statement reflects
both the disappointment with the Egyptian military`s decision, but also the
recognition that there`s no going back. The events are what they are, and
now, the efforts of the administration will be focused on pressuring or at
least encouraging the military to act in a pseudo-democratic way to restore
basic democratic process from here on out.

HAYES: There`s question at this hour about whether this constitutes a
coup, and whether -- if it does constitute a coup, there`s American law
that says we have to suspend aid.

I want to play you this video that has been reportedly from Al
Jazeera`s live broadcast, when Egyptian security forces walked in and told
them to shut down. Take a listen.


HAYES: Senator Leahy out with a statement tonight, "Our law is clear.
U.S. aid is cut off when a democratically elected government is deposed by
military coup or decree."

That when -- you combine that piece of tape and that statement by
Leahy, it seems like the law might be pretty clear here and the White House
is going to have to deal with that.

ROGIN: There are always ways around the law. We`ve seen over the
last two years repeated congressional efforts to place restrictions on U.S.
aid to Egypt. Just in case something like this were to happen, the
administration has resisted those restrictions and given all of the aid
every single time. If they want to, they`ll find a way to give the aid

And the Egyptian military again is calculating that U.S. interests
here in maintaining this relationship will trump its interest in punishing
them for their actions here tonight. We should also note here that the
Egyptian military got their latest aid, $1.3 billion last month in a secret
-- so they`re not even expecting aid for another year, a lot could happen
between now and then.

HAYES: Ultimately, I mean, the big takeaway as I looked at the photo
of the president and the principles in the Situation Room, is that this is
fundamentally an impossible situation for the U.S. in so far as, there is
nothing they can do that will satisfy the people of Egypt completely
understandably, and they have very little actual leverage in terms of
controlling any of the events that are playing out there.

ROGIN: Well, you`re right in the sense that these are events that
will be dictated by Egyptians in Egypt, with very little to no U.S.
control. At the same time, the criticism around Washington this entire
week has been that the Obama administration has failed to produce a policy
that would have maximized the little influence that we do have.

After the fall of Mubarak in 2011, U.S. policy was basically to
support Morsi, and to try to build the influence with him, and not use the
tools of American influence and power to pressure him to do things like
democratic reform and respect for the rule of law and human rights that may
have avoided this very scenario. So, yes, influence is limited but you
only have influence if you use it, and in order to use it. And in order to
use it, you need a strategy and a policy to implement it.

HAYES: Josh Rogin for "Newsweek" and "The Daily Beast", thank you so

ROGIN: Thank you.

HAYES: OK, when we return, in another country people took to the
streets today in support of their president. I`m talking about Bolivia,
where they are not happy about how their president was treated last night
in the hunt for Edward Snowden. It`s a wild story. And it`s coming up.


HAYES: The international manhunts for NSA leaker Edward Snowden has
played out for weeks like a spy novel. Last night it played out like a spy
novel spoof. And today, the Bolivian government is accusing Europe of
having kidnapped its president as part of the bizarre chase scene that
unfolded in international air space.

The latest details on the strangest international incident in recent
memory are next.

Plus, banks and employers working together have found a new and
creative way to rip you off. Paychecks that come with automatic fees are
all the rage.


HAYES: Picture for a moment that the vice president of your country
comes on television, surrounded by the national congress and says, "The
president has been kidnapped. He was flying home from halfway across the
world and now, he`s kidnapped." Well, it would not be surprising if you
and many of your countrymen took to the streets in anger chanting things
like attack on sovereignty. That`s exactly what happened to the people of
Bolivia when they found out their president, Evo Morales, was not allowed
to return home tonight.

Morales departed from Moscow late Tuesday when he reached the skies
over Europe, the Bolivian government claims he was denied airspace rights
by France, Italy, Spain and Portugal. The plane turned around and landed
in Austria. Morales stayed in Vienna airport where the plane was searched
with Morales` permission.

By morning, Morales was able to get on board and head home to Bolivia.

So, what was the catalyst to these dramatic developments? It is the
latest case of NSA leaker Edward Snowden. Morales was in Moscow for a
natural gas summit and he had been asked by the Russia Today television
network about Snowden.


UNIDENTIFIED FEMALE: If Snowden asks for asylum, will you provide it
for him?

EVO MORALES, BOLIVIAN PRESIDENT (via translator): Yes, why not? Of
course, the situation is far from ideal, his case is constantly discussed
on an international level. Bolivia is ready to give political asylum to
the people who exposed spying activities, so to speak.


HAYES: Somehow that statement raised enough suspicion about Evo
Morales and began a rumor that Edward Snowden was smuggled on board the
Bolivian president`s plane. But Snowden hadn`t been stowed away in the
landing gear or anything like that.

And today, there`s a lot of face saving going on. France apologized
sort of. The foreign minister`s office saying, the permission to fly over
French territory was granted, as soon as the French authorities have been
informed that the aircraft in question was that of President Morales. That
statement didn`t do much to prevent Bolivian protesters from lighting a
French embassy flag on fire today.

Later, the Bolivian vice president said his country is making a human
rights complaint to the United Nations. All of this international intrigue
is due to the status of one man in exile. And when you include the
countries that Snowden has petitioned for asylum, 23 nations are now caught
up in the swirling vortex of Edward Snowden.

A few weeks ago, we were talking about the impact of Snowden`s leaks
on the United States. Today, it`s clear he`s had an impact on the entire

Joining me now is Noah Shachtman, executive editor for news at foreign

This thing last night was bananas. I could not believe it was
happening as it was playing out in real time.

NOAH SHACHTMAN, FOREIGN POLICY: Yes. I think the technical term was
whackadoodle. It was nuts.

Look, there`s a longstanding tradition, there are longstanding
conventions about letting the leaders of countries travel where they may.
You know, you remember every September, Ahmadinejad, the Iranian president,
comes to New York to speak before the U.N.

HAYES: He stays in a hotel and he may order for room service.

SHACHTMAN: Yes, we don`t kidnap him, we don`t force him to fly, I
don`t even know where.

Yes, this is a very strange thing that just happened.

HAYES: OK, last night Gawker`s Adrian Chen had this great tweet. He
said the U.S. government just stopped and frisked the president of Bolivia
which is what I think felt like -- the Bolivians watching it. Argentine
President Christina Fernandez de Kirchner had this whole interaction with
Evo Morales last night.

She tweeted out and she said, "I called him, and he says, how is it
going? He`s like, I`m in a little room in the airport, and I`m not going
to let them search my plane, I am not a thief."

Here`s my question for you. How did -- what chain of communication
could have possibly happened that ended up with these four nations air
traffic control systems shutting down airspace for this flight?

SHACHTMAN: I have no idea. There`s longstanding kind rumor, there`s
-- that you could smuggle asylum seekers out by diplomatic pouch and maybe
-- or that you could get into somebody`s plane or car, and that you could -
- therefore be smuggled out. You remember --

HAYES: And you have immunity, because it would transfer to the

SHACHTMAN: Right. So, you`ll remember there was a Chinese dissident
a couple of years ago that was trying to get into Hillary`s car or at least
that was the rumor, and therefore, you would be safe. I think there`s some
element of that going on high here, but, honestly, it doesn`t quite explain
it. It`s just freakin` weird.

HAYES: OK, is there any conceivable way in which this was not --
today in the State Department, spokesperson Jen Psaki refused to say
whether the U.S. played any role, referred all questions to the four
nations at issue. They`re not going to say one way or another.

But it seems highly unlikely this was done by these four nations
independently without us making some kind of phone call.

SHACHTMAN: Then you add into that the 20, whatever, nations that have
refused asylum. You know, what it was making me think of -- just back on
your last segment in Egypt, where the U.S. seemed like an innocent
bystander or like the way that the Obama administration sometimes is
portrayed at home is being rolled by Congress. Here you have this rather
naked display of power, of do not let this guy into your borders, he is

HAYES: Because you`re saying that we have heard from country after
country after country saying, no way, he`s getting any asylum, we even hear
Vladimir Putin essentially withdraw and offer to keep them there when they
said, he may stop making life difficult for our friends, the Americans?

SHACHTMAN: Yes, it`s really amazing. It`s really a kind of muscle
flexing we haven`t seen from the Obama administration before.

HAYES: Although in some ways, it`s kind of a perfect example of the
kind of Obama approach in this in which he gets up in public and says, I`m
not going to scramble fighter jets. I don`t care that much. But behind
the scenes, American power is still a real thing. I mean, we saw exactly
what it looks like last night, it`s a force field over the western coast of
all of Europe that you cannot fly your plane through.

It makes me think like, they really -- I mean, this our government
wants Edward Snowden desperately to risk the kind of diplomatic fallout
that was precipitated across five nations last flight, Bolivia, the four
nations that divide airspace, plus all of South America which are meeting
today. To risk that, it shows how badly they want Edward Snowden.

SHACHTMAN: Yes, it`s true. And it turns out I guess that you don`t
need to scramble fighter jets in order to down a plane.

HAYES: That`s right.

SHACHTMAN: I would have thought they wanted was on the laptops is the
other secret programs that he has yet to disclose from the NSA. I would
have thought that was the important thing. It seems to me the important
thing, the calculation the Obama administration has made is the important
thing is to get this guy and get him into court.

HAYES: He is as far as we know, our correspondent Jim Maceda, says
that he appears that he`s in the Novotel Hotel in the transit zone of the
airport, right now eating cinnabuns and applying for asylum, presumably.

Noah Shachtman from "Foreign Policy" -- thank you so much.

SHACHTMAN: Thanks for having me.

HAYES: All right. Imagine being forced to pay for your paycheck.
It`s happening right now to employees at some big companies. More on that
coming up next.


HAYES: Chances are you`ve got an ATM card that also works as a debit
card. And you know if you use it at the wrong place, you`re going to pay a
fee for it. I`ve got one, we all know. And if I need to take out money, I
will walk three extra blocks to get to an actual branch to escape paying
that fee. I mean, paying 3 bucks to buy my own money is ridiculous, and
that is why this story is so outrageous.

Recently, there`s this trend massive retailers like Walmart and Home
Depot and franchises like McDonald`s and Taco Bell are now paying their
employees with payroll debit cards instead of paper checks, which seems
fine and convenient and efficient, until you learn that those workers have
to pay that fee and others no matter where they use those debit cards.

Think about what that means? It`s like going down to human resources
on Friday to collect your check and they put out their hand and say, you`ve
got to give me 5 bucks to get it. If you`re making $7 an hour, one or two
fees on these payroll debit cards could take away half an hour of your pay
just like that.

Do you ever work for half an hour for free? Because that half hour of
you busting your butt, just went to the bank.

Here are some of the fees typically associated with this payroll debit
cards, according to "The New York Times" and the bank`s own payroll debit
card Web site. A $1.75 withdrawal fee after the first withdrawal. So, a
minimum wage worker taking me $150 to $200 a week after taxes can make one
withdrawal for free, every other withdrawal is $1.75 no matter where you do

Balance inquiry, 50 cents a pop. Transfer fee, $1.50 to move your own
money from the payroll debit card account to your own bank account, 50
cents every time you use your awesome payroll debit card for a purchase. I
repeat 50 cents per purchase and we`re not done, $25 overdraft fee, $2.95
for a paper statement, $6 to replace the card and this is by far the best
one, if you think you`ve outsmarted the system by using the card as little
as possible, think again, a $7 inactivity fee.

More than two dozen retailers have this $7 inactivity fee. Sometimes
the inactivity fee is less, a mere $2.50. When it kicks in various from
bank to bank, but talk about the banks getting you coming and going and
this isn`t some boutique practice, huge retailers like Wal-Mart, Walgreens
and Home Depot use it. They at least give their employees a choice along
with direct deposit or sometimes the old fashioned paper check.

McDonalds doesn`t do it as a corporate policy, but many of their
franchisees do so does Taco Bell, but many employees have no choice. In
other cases, the employee is enrolled in the payment program automatically,
and there`s a small mountain of paperwork to get out of it. Consumer
advocates say that some employees are afraid to request other options.

The reason for the growth of the practice, you won`t be surprised to
hear, is that it is a sweet deal for the participating banks like Citibank,
Bank of America, JPMorgan Chase and Wells Fargo, and for the largest issuer
of payroll cards, Net Spend. The banks are making swipe fees. The kind of
swipe fees they were prohibited from making with regular ATM cards under
Dodd Frank Financial Reform.

And they are offering savings to the employers. According to "New
York Times," a calculator on Visa`s website estimates a company of 500
employees can save $21,000 a year by using payroll debit cards instead of
checks. This year there are 4.6 million active payroll cards worth $34

In 2017, the estimate is $10.8 million with nearly $69 billion worth
of money. It`s easy to see how the fees on billions of dollars can easily
reach the hundreds of millions up to a billion dollars or more per year.
Everybody is making money off of it, except the low wage hourly employee
who is losing money from the deal. Sometimes so much so they are
effectively reduced to sub minimum wage according to advocates and state
and federal regulators.

This heinous practice persists because there are three parties, the
employee, the employer and the bank. And two of those three are making
money off the deal, but not the working stiff. Not all hope is lost.
There is the case of Natalie Gunshannon who made $7.44 an hour working at a
Dallas Pennsylvania McDonalds. She had no choice but to use the payroll
card, she quit and sued.

Just this week, the owner of the McDonald`s franchise changed their
policy to offer direct deposit and paper checks to their employees, but
that does not affect Ms. Gunshannon`s lawsuit, which is ongoing. She is
seeking punitive damages.

There is also New York Attorney General Eric Schneiderman, a guest of
the show, who sent letters to 20 employers including Wal-Mart, Walgreen and
McDonalds requesting information about the practice. We`re concerned about
excessive or insufficiently disclosed fees, which may unduly reduce
employee`s take home pay he wrote in that letter.

The question is whether these fees, particularly when there is no
choice, violates state labor law and the attorney general`s office is
looking into it with this inquiry. Make no mistake, whether it`s the
normal ray of payroll debit cards or New York`s attorney general or some
class action lawsuit being formulated as I speak to combat these practices,
neither the big banks nor the big employers should feel free to extract
money from their low wage employees just to get them their hard earned
minimum wage paycheck. It`s crazy I even have to say this, but here it
goes. You should not have to pay just to get paid. We`ll be right back
with Click 3.


HAYES: If you notice Republicans walking with a little extra spring in
their step today, it`s probably because Obamacare implementation hit a
little snag yesterday. We have someone who worked on getting the
affordable care act passed to discuss the real obstacles. That`s coming

But first, I want to share the three awesomest things on the internet
today beginning with a great way to kick off the long holiday weekend, time
to head to the beach, be sure to bring a good book. If you don`t have a
summer reading list yet, you are in luck. Earlier this week, the hash tag,
books with a letter missing, was trending on Twitter offering all sorts of

And as our Twitter super fan Jessica points out, now thanks to the
magic of Photoshop, we have the accompanying book jackets. There`s this
resonance romance featuring your favorite your "The Princess Bree," a
displaced Don Draper Travels through California in search of job
opportunities of ice and men, yet so many get so lonely. Find out why in
this multi-generational classics 100 years of solitude. And spoiler alert
here`s Waldo. You can cross that off your list.

The second awesomest thing on the internet today, a contest that pays
tribute to the height of `80s fashion, Bills Cosby played beloved Dad
Heathcliff Huxtable on the "Cosby Show" for nearly a decade and in addition
to great moves, Dr. Huxtable is known for wearing a lot of truly foggily
sweaters. The urban dictionary defines the Cosby sweater as an oversized
hideous looking sweater with ugly patterns and colors often worn by old men
or hipsters with no taste.

For the record, this kind of fashion on a bearded 25-year-old is
indeed obnoxious. This seemed this kind of fashion the guy (inaudible) is
awesome. Now fans can vote for their favorite Cosby sweater on Bill
Cosby`s own web site. There are argyles and cardigans. All of Mr. Cosby`s
sweaters are kind of the same, which is what makes them so great.

The third awesomest thing on the internet today, the president is
finishing up his trip to Africa. The third and final leg of his journey
brought him to Tanzania where Mr. Obama danced his way down a red carpet.
Now we all know that the president is generally a pretty cool customer. So
these moves should come as no surprise. How do they measure up to previous
leaders, past and present.

There`s the Colin Powell, Hillary Clinton and for those who truly hate
the spotlight, may I suggest the Ban Ki-Moon? He clearly drew the short
straw here. You will want a good deal of liquid courage before attempting
this one. For those who find it difficult to make friends. There`s the
George W. Bush. No one will remember all the terrible mistakes you made as
long as these smooth moves live on forever on the internet. You can find
all links for tonight`s Click 3 on our web site, We`ll
be right back.


HAYES: Political fight has erupted over the past 24 hours in Washington
and shed light on a really perverse truth about American politics right
now. Bad news for uninsured Americans, hoping to gain access to health
care through the new health reform law, is actually great news for
Republicans, because bad news involving Obamacare is what Republicans hope
and dream and wish for every day.

The Obama administration announced yesterday that the implementation
of the so-called employer mandate will be delayed for a year until 2015.
This is a part of the new law that requires businesses with 50 or more
workers to provide affordable health insurance or face a range of per
employee fines. The Obama administration says it`s simply a way to give
businesses more time to comply with the new rules. Republicans say it is
proof that Obamacare is a disaster, nightmare apocalypse that must be
appealed immediately, for real this time.

Republicans have treated the news with unbridled delight. House
Speaker John Boehner released a statement that reads in part, quote, "This
announcement means even the Obama administration knows the train wreck will
only get worse. And underscores the need to repeal the law and replace it
with effective, patient-centered reforms."

So with all their pointing, laughing and jeering, Republicans have
drawn the beltway`s attention to this employer mandate delay, which is
important. Let`s not get too carried away here about how important it is,
it imposes a penalty that is far less than the cost to providing health

And since most big companies already provide insurance benefits, it`s
one that only affects about 5 percent or 6 percent of workers at business
with more than 50 people. Meanwhile, there is a major ongoing problem with
the implementation of Obamacare, one that no one`s really talking enough
about, that is outrageous and destructive and far reaching in consequence.

We saw that problem play out in realtime in Pennsylvania`s state
Senate today where lawmakers left for the summer after a committee vote
that killed a plan for participating in Obamacare`s Medicare extension, a
provision that would have extended health care coverage to 850,000
uninsured Pennsylvanians.

They are not alone. Nearly 10 million uninsured Americans who could
get coverage are trapped in states where Republican governors or
legislators may refused to expand Medicaid.

Joining me now, Avik Roy, a senior fellow at the Manhattan Institute,
former member of Mitt Romney`s health care policy advisory group, Joan
Walsh, editor-at-large for Salon and author of the book, "What`s The Matter
With White People?," and Congressman Jerrold Nadler, Democrat from New

So this news, I`m of two minds about it, at one level the actual news
part of it, which is what this means for people who are sick and want to
get health insurance doesn`t seem like a huge deal. Are we in agreement
about that aspect of it?

REPRESENTATIVE JERROLD NADLER (D), NEW YORK: It is not and it`s even less
of a deal because of what you didn`t say. It includes -- it affects very
few people because 95 percent of firms with more than 50 people give
healthcare now, and the employees of large firms that don`t will be able
to, starting in October, to sign up for health care on the exchanges with
subsidies from the federal government if they make less than $94,000.

HAYES: The employer mandate has never been a super popular idea among
health care wonks to begin with, I would say in a bipartisan fashion, this
one particularly, because the penalty was going to be less than one would
pay to get health insurance, never seemed it was going to do that much in
either direction.

AVIK ROY, THE MANHATTAN INSTITUTE: Yes. So I`m with Ezra Klein on this.
I mean, he wrote in 2009 that it was the worst idea in health care reform.
I`m with him. It artificially increases the cost of labor, which decreases
the incentive for low wage income people to get hired. High wage people it
doesn`t matter, they`re going to get employer sponsored coverage, but it`s
low wage individuals who are going to get harmed by this. It doesn`t
affect the actual coverage expansion of the law.

HAYES: Why is it in there?

NADLER: It`s there because it was not a great idea. It was put in by the
Senate. The House version of the bill had a better idea, which was to say
that employers above 50 had to pay a certain percentage of their payroll to
cover this, but when Scott Brown won his election, nothing in the House
bill could be substituted for anything in the Senate bill.

HAYES: This is Scott Brown`s fault?

NADLER: It`s the Republican`s fault because they were not looking to
improve the bill no good idea --

HAYES: The politics of it do seem like a big deal. Why did this happen?

JOAN WALSH, SALON.COM: Right. There are so many things in the bill, and
the congressman is an expert, not me, but there are many things in the bill
that people would like to fix, and in a normal world, you would pass them.
Congress goes back and we see how it works or doesn`t work, and we fix it,
we can`t fix it, because the Republicans refuse to do anything, but talk
about repeal -- a full repeal.

ROY: Here`s one that may be an exception it doesn`t affect any of the
issues with the law. I`d be interested to see --

HAYES: That would do the thing --

NADLER: Without knowing anything about this bill -- without having heard
of this bill, I would almost guarantee the Republican leadership will not
allow it to see the light of day.

WALSH: Eric Cantor can`t get his own bills out there.

NADLER: They don`t want to see, Joan`s entirely right. We pass Social
Security, Medicare, there`s always cleanup legislation. They will not do
any cleanup legislation. They want the bill to be sabotaged.

HAYES: Part of this are also the optics of this. I mean, the most cynical
way of viewing the announcement by the White House today, while the
president is flying back from his Africa trip. That basically, OK, big
employers were ticked off about the reporting requirements this would
impose on them. They lobbied behind the scenes and it got away. That
doesn`t quite seem the way this whole role out should go, which is that if
you`re big enough and powerful enough, and ticked off by having Obamacare.

NADLER: I don`t think it`s a big influence, it`s the medium size. The big
employers have 98 percent.

HAYES: That graphic has a --

NADLER: The companies with employees between 50 and 100, 50 and 200 are
the ones that are affected by this, now, 94 percent of them are giving

HAYES: It`s great you knew that off the top of your head. We have a chart
showing that data right now, if you got that wrong, that would have been
embarrassing. I want to point that out.

WALSH: Good job.

HAYES: If there has been discontent. The other thing that is interesting
about this, presumably, this does -- at the margin push more people on to
the exchanges, which are getting set up in October. I want to talk about
the exchanges getting set up in October and the Medicaid expansion that is
driving me out of my mind after this break.


HAYES: Today in New Orleans, the National Association of Free and
Charitable Clinics held a free clinic in New Orleans for folks that do not
have health insurance. We got tons of great turnout. Thanks to
contributions from you, the viewers. Once again a lot of people who would
not have access to the crucial care they need are able to get it, thanks to
NAFC. Thank you all for your support.


HAYES: I`m here with Avik Roy from Manhattan Institute, Joan Walsh from
Salon and Congressman Jerrold Nadler. We`re talking about implementing
Obamacare and the place I think this is the most perverse is on Medicaid
expansion. It also seemed the political incentives would get Republican
governors and Republican state legislators to go along with Medicaid
expansion, partly because of the power of doctors and hospitals in the

We saw this in Florida with Rick Ccott, where the head of -- he used
to run the hospital chain. And when the folks from the hospital industry
started testifying in the hearings, Rick Scott saw the light on this, Jan
Brewer, same way in Arizona, a shocking number. If you had bet me on this,
do you have the map with the different states? Here we go. A shocking
number of these states are refusing it. How do you understand the politics
of this?

WALSH: I think they really are determined to make this legislation fail
and they don`t care. These are not the people they care about, and they
don`t believe the government should be in the business of doing this, and
so it`s a totally ideological thing. It`s so many governors who are
elected in that wave of 2010 as well, it`s a test of their Tea Party
principles and people are losing and they`re winning.

HAYES: Jan Brewer, I mean, to me, she`s the fascinating out liar here,
because not only did she go for it, she went to war for it. I mean, she
like -- she was like (inaudible). We all broadly understand the budget as
a way of throwing the Tea Party base of Ohio state legislators a bone,
because he wants to get the Medicaid.

NADLER: Maybe unlike Governor Jindal and others, they do care about
thousands dying in their state. It was only an activist Supreme Court that
made --

HAYES: Not just an activist right wing Supreme Court. In contrast to all
the weeping, liberals have been strangely silent in a myriad of ways in
which liberal justices have disappointed them. There was only -- I believe
there were only two -- were there only two dissents in them?

ROY: Yes, it was 7-2.

NADLER: They took what they can get. It was a brilliant decision by
Robert because he gave the Democrats what they wanted. Obamacare is
constitutional while murdering congressional power to regulate under the
spending power. Terrible thing in the future, but remember that under the
bill, the Medicaid expansion which for the first time states that the
option of not going into, the federal government will pay 100 percent of
the costs for three years and 90 percent of the costs thereafter, and
states will end up saving money, because they`ll be less business at
emergency rooms and so forth. What these governors are choosing to do is
spend more local taxpayer`s money, in order not to provide health care.

HAYES: Let me quickly read to people. The Supreme Court decision said the
part of the law which had compelled states to join the expansion or forfeit
all Medicaid dollars was unconstitutional. Was overreached by Congress, it

NADLER: It was a completely novel interpretation. Right now have you to
wonder if there is a requirement in the law that says, if you want money,
build a new interstate, you have to have three inches of asphalt, and if
Congress decides next year it should be five inches, whether we have the
power to do this.

HAYES: So here`s the question, these 700,000 people, 800,000 people in
Pennsylvania, which looks like they`re going to be left out. What happens
to them?

ROY: So 1/3 of them would be eligible for coverage under the exchange.
That`s a big chunk and then the other -- you have to know in the individual
state how many people are left in the gap between the pre-existing Medicaid
program --

HAYES: Just so people understand, the expansion was going to bring
qualification for Medicaid up to 33 percent.

NADLER: In many states, even if you`re at or below the poverty line, you
do not qualify for Medicaid, unless you have certain other conditions.
What will happen now is, if you`re above 133 percent, you can get into the
exchange, you can get a subsidy, if you`re below that, you may have no --
depending on the state, you may have no way of getting any assistance for
health care.

ROY: There`s two points I want to make. It`s not merely that Republicans
want to kill four people, that they`re opposed to the Medicaid expansion.
It`s also in the case of Pennsylvania, when the law is fully implemented.
Taxpayers aside from the federal tax dollars, they`ll be spending $700
million a year on Medicaid expansion. There is a big taxpayer --

NADLER: They`re going to spend more than that $700 million on emergency
care otherwise.

ROY: That`s debatable. The other point I want to make, is the best
evidence we have, is that Medicaid does not protect people from death, with
a study in Oregon showed there was no improvement in health outcomes.

NADLER: Every study we see says that about 45,000 people a year.

HAYES: Can I say about the Oregon study, which has been lit gated a
tremendous amount. The big take away, people were much happier and much
less depressed.

ROY: We`re financially secure.

HAYES: You know what I say, that`s a huge boon. If I can reach out to
800,000 of my fellow citizens in my state and make them less depressed and
happier, then you know what, God love it, I want to do that.

ROY: There are so many more efficient ways to do that than the way the
Medicare --

WALSH: I don`t know if that`s true. I don`t think.

HAYES: What we`re seeing right now, the people, this slice of the -- of
our fellow citizens who are the people that were targeted by this law,
that`s going to benefit the most from this part of the law are going to be
locked outside.

NADLER: All the Republicans who were saying no are not giving us any
alternatives to cover them.

HAYES: Avik Roy from Manhattan Institute, Joan Walsh from Salon and
Congressman Jerrold Nadler, thank you so much. That is all in for this
evening. The "RACHEL MADDOW SHOW" starts right now. Good evening, Rachel.


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