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All In With Chris Hayes, Wednesday, March 19th, 2014

Read the transcript from the Wednesday show

March 19, 2014

Guests: Lawrence Wilkerson, Andrij Dobriansky, Clive Irving, Raphael Warnock, Bob Herbert, Melissa Hayes, Lee Fang

CHRIS HAYES, MSNBC ANCHOR: Good evening from New York. I`m Chris

Tonight, serious concerns at the Pentagon as thousands of Russian
troops with heavy armor and aircraft gather just miles from the border with
Ukraine. One official telling NBC News, quote, "It`s like they`re on a
hair trigger." This as NATO labeled the invasion of Crimea a wakeup call.


threat to European security and stability since the end of the Cold War.


HAYES: President Obama this afternoon specifically ruled out U.S.
military action against Russia.


getting into a military, you know, excursion in the Ukraine. I think even
the Ukrainians would acknowledge that for us to engage Russia militarily
would not be appropriate and wouldn`t be good for Ukraine either.


HAYES: In Crimea, the situation is extremely volatile. Right now,
there are reports a Ukrainian rear admiral is being detained by unknown
assailants or being questioned by Crimea prosecutors after Ukraine`s naval
headquarters in Crimea came under siege.


HAYES (voice-over): Ukraine`s naval headquarters in Crimea overrun
today by pro-Russian forces, who cut down a gate, trashed offices and
raised the Russian flag. While Ukrainian forces packed up their belongings
and left, telling journalists there was nothing they could do against the

Elsewhere on the peninsula, Ukrainian troops are still stuck in their
bases while pro-Russian troops hover ominously outside. Many civilians in
Crimea have welcomed the Russians.

But there`s a substantial Crimea minority who don`t want to be part of
Russia. The Tatars, who were driven from Crimea under Stalin boycotted the
referendum on Sunday.

Hundreds turned out yesterday with a funeral of one of their own who
had protested the annexation.

UNIDENTIFIED MALE: Rashid Ahmed`s (ph) body was found in a shallow
grave, violently murdered according to the police. A family man opposed to
the Russian takeover, he was last scene being abducted by three members of
the so-called self-defense forces.

HAYES: In what remained Ukraine today, other self-proclaimed pro-
Russian defense forces are outside the rest of the city of Donetsk, vowing
to protect the city from Western forces.

This comes even as Ukrainian forces hold drills in the Donetsk region,
30 miles from the Russian border. The region`s governor today asking for
international help to protect Ukraine`s territorial integrity. While over
in Russia, Kazakhs are patrolling the border with Ukraine.

The Obama administration today took steps to reassure other Russian
neighbors, especially NATO allies.

continues on this dark path, they will face increasing political and
economic isolation.

We will respond to any aggression against a NATO ally.

HAYES: While back in the United States, Republicans ratcheted up
criticism of the president.

SEN. JOHN MCCAIN (R), ARIZONA: So far, the weakness of the
president`s initial response, sanctioning 11 people is -- I -- it`s hard
for me -- I run out of verbs and adverbs.

REP. LOUIE GOHMERT (R), TEXAS: As you know, you don`t take a knife to
a gunfight. Well, this president has taken a paint ball gun to a gunfight.

HAYES: After the loss of a naval base today and the death of the
junior officer yesterday, Ukraine is drawing up plans to withdraw its
troops from Crimea, and has asked to turn the peninsula into a United
Nations demilitarized zone. But the situation on the ground doesn`t seem
to make that very likely.


HAYES: Joining me now, Colonel Lawrence Wilkerson, who was chief of
staff at the State Department during General Colin Powell`s term, currently
a distinguished adjunct professor of government and public policy at the
College of William & Mary.

Colonel, it seemed to me today that this is it. I mean, Crimea is now
Russian, if not recognized by international law, certainly in terms of the
facts on the ground. And the question is, OK, well, what does the U.S. do?
Is it just, that`s the way it is?

with you, and I have to say, Chris, watching Mr. Rasmussen, NATO secretary-
general, issued the statement, you just played reminded me he was the
Danish leader who dragged his country Denmark into the disastrous Iraq war
in 2003.

This is not something that anybody needs. Not the West, not Russia,
not the world. There needs to be an end to the polemics as you showed from
people like John McCain and end of passion, an end to the punditry and a
solution. The solution is staring us in the face.

Gordon Adams and John Mirshimer (ph) and others have talked about it
over the last few days. Ukraine needs to be a buffer state between what is
an alliance that Russia hates, NATO, and a country that NATO has a problem
with, Russia.

Ukraine needs to be the buffer state, Crimea needs to be exactly where
it is with Russia, where it`s been for over 350 years, and we need to stop
the passionate statements and get down to business and work this out. We
don`t need a war.

HAYES: Believe me, I -- with that sentiment, I`m 1,000 percent in

But there are people who say, look, people do not necessarily predict
or U.S. intelligence certainly didn`t do a very good job of foreseeing the
fact that Vladimir Putin would send these unmarked soldiers into Crimea,
that take Crimea in response --

WILKERSON: Chris, let me tell you, I can only imagine that John
Brennan who was too preoccupied with trying to spy on the Senate of the
United States, particularly the SSCI and miss this. My 4-year-old
grandchild would know that given the history of Russia, that Crimea was
going to be just as Panama in `88 and `90, for us in `89 and `90 when we
invaded Panama and removed their leader under the so-called Monroe Doctrine
which had been operating for about 150 years. Russia has it`s near abroad
doctrine, call it what you will, it`s what great powers do within their
sphere of influence.

HAYES: So, let`s extend that for a second. Let`s say they decide
that Kharkiv, or Donetsk is close to the Russian border. They certainly
don`t any -- what they view as hostile forces to take those, they do the
same thing they did in Crimea. In fact, we already see self defense
forces, unmarked soldiers come in. I mean, do you just let that play out
in the same way Crimea played out?

WILKERSON: Let it play out exactly -- our blockade of Cuba has played
out for us. We`re isolated, Cuba`s changing rapidly, and the policy is an
abject failure.

I don`t see any problem with giving Putin abject failure after abject
failure, he`s not presiding over a very healthy country right now. Taking
on more and more is just going to aid in that process of Russian

HAYES: I want to bring in Andrij Dobriansky. He`s executive board
member of the Ukrainian Congress Committee of America, which monitors
Ukraine`s presidential parliamentary elections, also the U.N.
representative for Ukrainian World Congress.

Your reaction to the events today, to what the colonel is saying, and
the sense that Crimea is essentially gone from Ukraine.

to the gut to see soldiers killed, as we saw yesterday. They see a shot
the Crimean man who was on his way to sign up for the military, his body
found bungled and tortured.

And then to hear world leaders like Obama say there`s no sense of
boots on the ground. It`s not that we`re advocating for boots on the
ground, but to have at least some kind of level playing field. Everybody
wants to have a revolution, a detente, a ceasing of violence. But we`re
not at a level playing field because one country has gone into country
after country and claimed territories.

HAYES: But the level playing field, which would be increased,
essentially, rhetorical escalation, not taking military options off the
table. The fear and I think it`s a very, very rational fear, that becomes
a slippery slope, to mix metaphors, that essentially one side ratchets up,
and pretty soon you have two nuclear powers staring at each other across an
incredibly tense stretch of land and no one, no one wants that.

DOBRIANSKY: And if anybody can figure out a way that human society
figures out problems in a way other than that, I think that`s pretty much
what you have. We saw it in Congress this year, with the budget
negotiations, everyone likes brinksmanship. That`s what happens on an
international scale as well. It`s people relating to people.

Unfortunately, you`re relating to somebody, Putin, who is operating as
a rogue state. For all intent and purposes, he`s operating in a world just
like North Korea.

HAYES: I want to get Colonel Wilkerson`s response to that.

Do you think that Putin is -- he`s acting if not morally or if in
coincidence with international law, acting rationally as a great power,
preserving his sphere of influence, not as a rogue state?

WILKERSON: Of course he`s acting rationally. Let me just say, I
object 100 percent to what we do all the time in Washington. And that is
put a personal character face on every crisis.

I don`t care if it`s Putin or Katherine the Great, this is Russia.

DOBRIANSKY: There`s a lot of faces that you can see on the streets of
the Maidan. This is about a reaction of Putin and I`ll put a face on it,
because it`s a personal reaction, he`s leading the charge here. It`s a
reaction to the Maidan. All those students who went out --

HAYES: The Maidan, being the name for the plaza in which the uprising
against the Yanukovych government --

DOBRIANSKY: Yes, it was begun by students, it`s begun by people who
lived after all of this history. So, you can mention Catherine the Great,
you can mention the Soviet Union, but all these students have grown up
after that fact.

You are now having a post-Soviet birth rate happening in the former
Soviet Union, and all these people want an equal opportunity. They want to
have jobs. They`re not getting them right now. They want to have the
opportunity to speak freely and they didn`t have that under Yanukovych.

HAYES: What happens in Ukraine? What is the political atmosphere

I want to play a tape I found fairly disturbing. This is the far
right party Svoboda. Svoboda lawmaker assaulting the head of the state
television in his own office before forcing him to write a letter of
resignation, this happened I believe yesterday if not --


HAYES: And it basically was you feckless idiot, you are not
confronting the Russians enough.

I worry what folks like yourself say, it`s a small sliver of Ukrainian
opinion is going to grow in this environment in which they feel Russia is
taking, taking, taking and not giving back.

DOBRIANSKY: Well, I don`t know about the characterization of Svoboda.
It`s a far right, I heard ultra right, all these different things about
right wing and left wing, which is hard to describe for what happens in
Ukraine for the first place.

But what happened in that, just put yourself in that situation -- your
country has been invaded you`ve been living under the most corrupt
financial regime in the history of the world, $70 billion stolen from the
public coffers. You have the regime on your doorstep threatening to grab
more of your territory.

And the rhetoric up in Russia was crazy. There was a schoolteacher
who let her students out early because she said to all the students,
America will be invading. This is a Russian schoolteacher. There are
dozens of stories like this out there now that the rhetoric in Russia is

So, when you come to a country, imagine your country is invaded and
you`re getting rhetoric on the other side.

HAYES: Yes. But this is precisely -- Colonel, this is my concern
about this, this is why I think the degree to which policymakers and even
the American media are pricing or predicting the tail risk of this, the
possibility for things to get out of hand very quickly is vastly
underestimated, is because militarism acts like a tuning fork, and
everything seeks to the same tune, that to me strikes me as a main concern
right now between Ukraine and Russia.

WILKERSON: I think so. I certainly feel for people in Ukraine who
want a genuinely better economy and a better life. But I will say that I
have seen no leader that the Ukrainians have been able to produce to this
point who looks like they`re interested in anything but oligarchy, whether
it`s Tymoshenko, Yanukovych or whomever.

So, Ukraine`s got to work out a lot of its own problems, it`s
fundamental problems itself. And the best way to do that in my view and to
not excite this great power rivalry that might suck us all in is to create
a buffer state there, recognize Crimea as being gone, create a buffer state
in Ukraine, get the CIA out of Kiev, get its equivalent in Russia out of
Kiev, get the NDI, the NAD and all the rest out of Kiev, and let the
Ukrainians take care of that part of Ukraine and bring it back to some kind
of prosperity and stability.

HAYES: Do things stop after Crimea? I think that is right now the
question upon which much of this balances.

Colonel Lawrence Wilkerson, Andrij Dobriansky from the Ukrainian
Congress Committee of America -- thank you gentlemen both.


HAYES: Coming up, we still don`t know what happened to Malaysia
Flight 370. We do know there`s a small set of precedents to work on them
like this.


NARRATOR: August 14, 2005. A Helios Airways 737 with 121 people on
board circling in the sky near Athens. Radio contact with the plane has
been lost. Air traffic control can`t get any response from the captain or
co pilot. On the other side of the locked cockpit door, no one in the
cabin would have known the plane was now flying itself.


HAYES: What happened on Helios flight 522 and why some people think
the same thing could have happened to Malaysia Flight 370.

Stick around.


HAYES: Remember vintage town hall Chris Christie before bridge gate?


GOV. CHRIS CHRISTIE (R), NEW JERSEY: Let`s start with this, I sat
here -- stood here and very respectfully listened to you. If what you want
to do is put on a show and giggle every time I talk, well, then, I have no
interest in answering your question.


HAYES: That guy is back. The proof, ahead.


HAYES: New developments into the investigation of the missing
Malaysian Airlines Flight 370, with Malaysian authorities saying today they
have asked for help trying to recover data found to have been deleted from
the captain`s home flight simulator.

The Federal Bureau of Investigation is taking part of that effort.
And NBC News learned today the FBI has also been given copies of the hard
drive from the computers of both the captain and first officer.

Meanwhile, the search for the missing flight continues 12 days after
it mysteriously disappeared with 239 people on board, although the focus of
the search has narrowed.

Earlier data, showing where the flight may have been when it last made
satellite contact had fueled speculation the missing jet could have ended
up in dozens of countries or a wide swath of the ocean. But the primary
focus of the investigation is now on about 100,000 square mile area in the
Indian Ocean, about 1,500 miles southwest of Perth, Australia, below two
possible flight paths that investigators believe the missing jet may have

That is a significantly smaller primary search area than before, it is
still nearly the square mileage of the entire country of Italy. The task
of finding any possible wreckage remains extraordinarily difficult.

As the fruitless search drags on, the families of the missing from
flight 370 are at their wits end. A group of protesters saying they
represented the families busted into a news conference today with a banner
that read, we oppose the Malaysian government concealing the truth. One
desperate mother was dragged kicking and screaming from the room.


KEIR SIMMONS, NBC NEWS: A mother breaks down, desperate for news. "I
want my son back", she cried at one point, and collapsing as she`s taken
away by Malaysian officials.


HAYES: If we assume for the moment the plane did, in fact, end up in
the Indian Ocean, as investigators now suspect, it seems particularly
helpful to approach this mystery by doing what our guests Clive Irving
suggested the other night -- work backward from the end of the flight.

And you have to ask yourself, why would a plane end up out there, out
in the middle of nowhere? There is nothing there. There is certainly no
obvious reason to fly it into that remote area?

That brings us to one area that`s been floated, one that seems
considering, that the pilot and passengers were somehow incapacitated
during the flight and the plane flew out into the ocean on auto pilot.

Now, there is historical precedent for that just kind of thing
happening. In fact, it`s happened at least five times, including a Helios
Airline 737 that crashed in 2005, killing all 90 people aboard.

The flight that killed golfer Payne Stewart and three other people in
1999, a Learjet that lost cabin pressure between Orlando and Dallas,
incapacitating all onboard, and then flew for hours before running out of
fuel and crashing in South Dakota. Fighter jets were scrambled to
intercept the flight after the pilot became unresponsive.


CHRIS HAMILTON: It`s a helpless feeling to flew alongside the other
aircraft and realize the people inside that aircraft potentially are
unconscious or some other way incapacitated. And there`s nothing I can do
even though I`m only 50 to 100 feet away to help them at all.


HAYES: Joining me now is veteran airliner reporter, Clive Irving,
senior consulting editor for "Conde Nast Traveler" and contributor to "The
Daily Beast."

And, Clive, take me through your piece today. You talk about how
Flight 370 could have become a zombie. And it starts with this working
backwards idea that you raised on my show the other night, and it`s kind of
stuck with me ever since.

CLIVE IRVING, CONDE NAST TRAVELER: Well, it looks very different if
you start at the end rather than in the beginning because it`s a relatively
clean situation, we have only one source, no one`s arguing about other
sources, the sources were pinging through the satellite, and the plane has
been flying for at least -- the time it`s been flying for is disputed a
little because we`re not quite sure, but indeed we`re not sure at all on
its course.

But one thing that would have happened would be the plane flew until
it ran out of gas, when it runs out of gas. The 777 is known as most
planes should be, as a very stable aircraft and inherently stable aircraft.
So, it can actually fly on the auto pilot without human intervention for a
long while.

And how that would end, the fuel in one engine would dry up, that
engine would close down. The other engine would still be running. So,
that would cause an asymmetry in the thrust of the engine. The plane would
do a kind of bank and turn and dive into either land or water.

HAYES: Now, when you think about precedence here, and one of the
things I find just from a hypothesizing perspective, basic rudimentary sort
of logical perspective, appealing about this theoretically, is that there`s
just -- there are precedence of this kind of thing happening. We`ve talked
about some of the flight in which the crew or passengers were
incapacitated, the flight flies.


HAYES: There is -- as far as I can tell -- no precedent for some kind
of foul play motivation by a pilot and a co-pilot. There`s been pilot
suicides, there`s been hijackings, but as far as I can tell, I -- we`ve
been unable to find evidence that anything like this what is being alleged
by Malaysian authorities has ever happened before.

IRVING: No, there`s one important difference between what seems to
have happened here and those other incidents that you`ve talked about,
which is that this plane lost all contact. In the case of the other
planes, the communications between the plane and the ground didn`t get
lost. The equipment was still working, they just couldn`t raise anybody --
in the case of the 737 in the Mediterranean, the passengers and crew were

The -- one of the many problems in this case -- one of the many
anomalies, if you like, in this case, is that it doesn`t fit exactly into
any other scenario. I`m used to analyzing crashes, and extrapolating from
the precedence, and then you begin -- most crashes are a combination of a
series of events which I happily combine into one moment, we can`t see
where those precursors for this accident are -- if it`s an accident,.

Now, there`s another important point here. From the beginning, this
investigation has been quasi-criminalized and every time some new piece of
evidence appears, it`s given a sinister meaning, like the simulator in the
pilot`s home is now being cast as something sinister that -- he deleted
something from the hard drive.

Well, we delete stuff from the hard drives all the time. I think that
-- I`d like to see this investigation become a lot more neutral than it
has. I think there`s a lot of prejudice being directed at two targets,
either someone in the passenger -- or the flight crew.

You wouldn`t, normally, in a crash investigation do that at this point

HAYES: You know, I have to say, there is -- I agree there`s a
mismatch into the degree of suspicion that seems to be emanating from the
authorities and sources from the investigation, and the public data that
we`ve gotten that would cast aspersions on them, and I think you`re right
to point that out.

Clive Irving from "The Daily Beast" -- thank you so much.


HAYES: Coming up, the state of Georgia just passed a law whose entire
intent is to not comply with the law. I`ll explain, next.


HAYES: The Georgia state legislature, both the House and Senate, have
passed and Governor Nathan Deal appears poised to sign into law, a pair of
bills aimed squarely at denying health insurance to hundreds of thousands
of Georgia residents while at the same time sticking it to Barack Obama.

The first bill makes it harder to expand Medicaid in that state by
taking the power to do so single-handedly out of the hands of the governor
and requiring approval from the general assembly as well. This gives
Governor Nathan Deal some political cover and conveniently also gives
Republican obstructionists a back stop should the Republican governor lose
re-election this fall.

The other anti-Obamacare bill that just cleared the Georgia
legislature is even more extreme. The original sponsor, Republican State
Representative Jason Spencer explained with startling candor, that the
purpose of his bill, quote, "is essentially noncompliance. We`re not going
to help this law get off the ground."

Now, noncompliance with the federal law is not a term you often here
from a lawmaker as the order and principle for a law they have crafted,
because the term noncompliance with the law has, well, shall we say, some
uncomfortable historical precedence.

What this legislation would do is ban any state organization from
running insurance navigator programs to simply help Georgia consumers buy
health insurance under Obamacare.

It would also ban any state or local government agencies or employees
from advocating for Medicaid expansion, except under certain circumstances.

And, as we reported last night, all of this is creating a backlash
movement of opposition in Georgia, where about 40 people were arrested in a
series of protests yesterday.

Joining me now is one of the people who was arrested, Reverend Doctor
Raphael Warnock, senior pastor of the historian Ebenezer Baptist Church in
Atlanta, Georgia, where he`s been spearheading the state`s Moral Monday

Pastor, is Governor Deal going to sign these into law?

hope not. He still has time to do the right thing.

That`s why we gathered at the capitol on -- yesterday to send to him a
very clear message that he doesn`t really want to be on this side of
history. History has not been kind to governors who have stood in the
doorway denying American citizens the benefits of being an American

In 1954, it was access to a decent education. Sixty years later,
we`re talking about access to decent health care. A federal decision has
been made. And each instance, you have governors that -- if you will,
standing in the doorway, saying the president may have signed it, the
Congress may have passed it, the Supreme Court may have upheld it, but we
will not give you access to the fruits of our great democracy.

I think all of us should be deeply concerned.

C. HAYES: Do you think this is equivalent to Jim Crow? This is
obviously a Jim Crow allusion, and, obviously, segregation, desegregation
and the term massive resistance, which characterized the Southern response
to Brown v. Board.

WARNOCK: Well, I think we have to listen to the legislator`s own
words as he talks about noncompliance.

And when in recent history have we seen this kind of obstruction? I
mean, we are certainly living in a hyper-partisan season in our country.
We debate these issues. People feel very strongly about them. People on
both sides of the aisle feel like they are patriots, but after we have had
the argument, and the law has been passed, why not comply to the law?

I mean, there are things that many of us are unhappy about. You lose
the argument, you try to win the election. It seems that there`s those who
say, well, if we can`t win the election, we will find a way to block
people`s access to polls, block people`s access to health care. In a real
sense, this is a crisis in our democracy.

This is the worst kind of taxation without representation. I mean,
think about it. The citizens of Georgia have paid for this Medicaid
expansion through their federal taxes. And our state leaders have said, we
will not expand Medicaid, although most Georgians have said that they would
like to expand Medicaid.

This is taxation without representation. You can use whatever kind of
analogy that you would like to use, but it`s a terrible situation, and all
of us should be worried.

C. HAYES: Yes. We should note it would also have a positive economic
impact on the state; $45 billion in Medicaid funds would come into the
state. There`s an estimate that it would create 70,343 jobs statewide.
That`s from Georgia State University.

Just to be clear about the kind of apocalyptic vision or the stakes
that the other side sees in this fight, this is a Facebook posting from
State Rep. Jason Spencer, who`s a sponsor of that bill.

He says -- when the Senate appeared to try to table the legislation,
he said, "I will identify the Republican Benedict Arnolds, the King George
III and his myrmidons who ship wrecked my path breaking, patriotic bill to
prevent the federal Leviathan from commandeering the machinery of state
government or resources to enforce ill-conceived federal health insurance
mandates. A patriot saves his country from his government."

That strikes me as a fairly extreme vision about what the Affordable
Care Act and health insurance for poor people represents.

WARNOCK: Well, it certainly has tones of secession, does it not, some
150 years or so after the Civil War, the sense that the federal government
is the problem.

And it`s hard to be lost on us that an African-American happens to
occupy the White House at this point.

C. HAYES: Yes.

WARNOCK: And it`s quite ironic, Chris. I mean, during this debate --
and again, we`re Americans, and so we debate these things and we debate
them fiercely.

But there were those who talked about death panels. And I submit that
a death panel met on yesterday. It`s called the Georgia state legislature,
and it decided that poor people, working poor people in this case, do not
deserve an opportunity to make it into the middle class, to have decent
health care in the richest country in the world.

C. HAYES: And it`s now up to the governor, up for reelection, this
fall to decide whether to sign off on that decision.

Reverend Doctor Raphael Warnock from Ebenezer Baptist Church, thank
you, sir.

WARNOCK: Thank you.

C. HAYES: Coming up: Clueless rich people compare progressive
taxation to Nazism continued. Stay with us.


C. HAYES: Today, we bring you the latest in an installment in a
series that I really wish did not need to exist.

But here it is, your Wednesday edition of clueless rich people
comparing economic populism to Nazism. Yes, I know we have been here
before, most recently with multimillionaire Tom Perkins, who compared the
progressive war on the American 1 percent to Kristallnacht, and then sort
of wished he hadn`t done that.


TOM PERKINS, VENTURE CAPITALIST: It was a terrible word to have
chosen. I guess my point was that when you start to use hatred against a
minority, it can get out of control.


C. HAYES: Today`s installment comes from a man who just might hate
progressive taxation as much as he hates former New York Governor Eliot


KEN LANGONE, CO-FOUNDER, HOME DEPOT: I know, for sure, he went
himself to a post office and bought $2,800 worth of mail-orders to send to
a hooker. We all have our own private hells. I hope his private hell is
hotter than anybody else`s.


C. HAYES: I give you billionaire Home Depot co-founder Ken Langone.

A man who has seen his net worth more than double since 2010 had this
to say about populist political appeals -- quote -- "I hope it`s not
working, because, if you go back to 1933, with different words, this is
what Hitler was saying in Germany. You don`t survive as a society if you
encourage and thrive on envy or jealously."

That gem from Ken Langone is part of a long, deeply preposterous
article from Politico about how the poor persecuted rich aren`t going to
take all this whining from the 99 percent lying down. They`re going to
figure out a way, somehow, to fight their way back into a winning political

But however will they do that? Perhaps by doing something, like, oh,
I don`t know, forming a group called Republicans for Cuomo, a sort of
clubby plutocratic group that is backing the putatively Democratic governor
of New York.

And you will never guess who the chairman of Republicans for Cuomo is.
Yes, none other than Ken Langone himself. Langone, by the way, already
seems to semi-regret comparing the fight against income equality to Nazism,
releasing statement apologizing to anyone he may have offended.

Governor Cuomo`s office, however, has not weighed in, while
progressive groups have already released an open letter urging him to
return Langone`s political donations.

But there might be one governor that billionaire Ken Langone likes
even more than Andrew Cuomo. And he`s right across the river in New

Just ahead on the show, a blockbuster new report on why Wall Street is
so in love with Chris Christie.


C. HAYES: Remember New Jersey Governor Chris Christie, the former
future president of the United States?

Well, he`s still governor, still doing his thing, like the thing that
made him a sensation, mixing it up at town halls.

Yesterday, he was duking it out with a woman who said she represented
the New Jersey for Health Care Coalition. She said the Christie
administration was not doing enough to help enroll people in the Medicaid
expansion, which she complimented Christie for adopting.


GOV. CHRIS CHRISTIE (R), NEW JERSEY: Stand up here and to misinform
people because you have an agenda is -- is just simply incorrect.

UNIDENTIFIED FEMALE: No, we have a budget statement. We will be
happy to share it with you. And we have asked for a meeting.

CHRISTIE: Listen, I write the budget, so I don`t need to read your
budget statement.



CHRISTIE: I write the budget. And Medicaid has been expanded in this
state. And I`m sorry that you favor Obamacare, and I do not.



CHRISTIE: I mean, I`m sorry. That`s just the way it goes.


CHRISTIE: I don`t know how many times you can stand up there and give
a speech and be wrong and continue to keep the microphone in your hand.


C. HAYES: Look, you and I may see that and think, I`m not sure he
comes off so well in that interaction, but, as you heard with the applause,
this is the thing that a lot of people like about Chris Christie.

But, beyond the confines of that town hall meeting room, the picture
looks a little different. Christie is holding on to a slim positive
approval rating, but it`s a decline of nine points since January, and 20
points from one year ago.

In a new FOX News poll, Americans say Christie would not make a good
president by a 2-1 margin. And while the tide of Christie scandals may
have receded momentarily, it has left on the beach something that looks
like the wreckage of a political career. And that tide is not going to
stay out forever. We still don`t know why those Fort Lee lanes were closed
in the "Time for some traffic problems in Fort Lee" bridge scandal.

And the two people basically protecting Christie by protecting
themselves, former Deputy Chief of Staff Bridget Anne Kelly and former
campaign manager Bill Stepien, are in the thick of a high-stakes court
battle over whether they can really refuse to produce relative documents
based on their Fifth Amendment right against self-incrimination, this just
as new e-mails reveal further communication between Kelly and Stepien about
the closure, and word this week that New Jersey federal prosecutors are now
looking into a story we have been covering extensively since this all broke
of the conflicts of interest between Christie ally and big Republican power
player David Samson, chair of the Port Authority, and the contract on two
bridge projects worth $2.8 billion that Samson voted to award to
construction companies with some ties to his law firm.

Those federal prosecutors have issued a subpoena to the Port
Authority. Oh, remember this?


UNIDENTIFIED FEMALE: The Jersey Shore is open.

UNIDENTIFIED MALE: The word is spreading.

CHRISTIE: Because we`re stronger than the storm.



C. HAYES: Now that a federal inspector general is looking into the
propriety of $25 million in Sandy relief money going to something that
looks like a reelection ad, there is fresh reporting about the shocking
lack of transparency in the bidding process, further suggesting that the
winning advertising firm won because it was planning to put the governor in
its ads.

Joining me now, Bob Herbert, former op-ed columnist at "The New York
Times," now a distinguished senior fellow at the progressive think tank
Demos, and Melissa Hayes -- no relation -- statehouse reporter for "The
Bergen Record."


C. HAYES: She was at the Christie town hall meeting yesterday.

Melissa, let me start with you. There was obviously this massive
vortex of scandal and questions around the governor. There was a lot of
looking at his record, a lot at looking at out -- sort of emanating out
from the bridge. What is the mood in the statehouse like these days?

MELISSA HAYES, "THE BERGEN RECORD": They`re actually carrying on as
if none of this is going on. They`re still having these town hall events.
He`s going to a ribbon cutting tomorrow after a town hall event in
Flemington for a new Cake Boss bakery in Morris County.

So, I think they`re trying to just move ahead with their agenda, and
show people that they can continue doing the work of the state without
addressing all of this stuff. The Democrats obviously don`t want to let
that happen. They`re leading their own investigation. And their mood in
the statehouse is a little bit different.

C. HAYES: Bob, you were a newspaper reporter for years. And one
thing about scandal is, it ebbs and flows, right?

There`s periods of high amounts of revelation, and then there`s kind
of periods...


C. HAYES: And even in the biggest one, even in Watergate, for
instance, there were periods where there was nothing new coming out, and
then, all of a sudden, something breaks again. You have got to think, if
you`re walking around that statehouse, that there`s this other shoe
constantly threatening to drop.


HERBERT: I think this scandal is so much like Watergate.

There`s this drip, drip, drip that`s out there when you have these
investigations, little bits of information. Subpoenas are issued. People
take the Fifth and that sort of thing. And then, if you remember, Woodward
and Bernstein were told to follow the money. And that seems to be where we
are in this investigation now, when you start looking at what`s going on
with David Samson and the law firm and that sort of thing, contracts
issued, people trying to find out whether there was a conflict -- were
conflicts of interest and that sort of thing.

So, I think that it`s very dangerous. You are right about the ebb and
flow, but there`s much, much more to come in this scandal.

C. HAYES: Well, the mystery -- that`s the thing about this always,
right? Someone can come forward tomorrow in Bridgegate and -- and just
explain why the whole plan was cooked up and just put an end to it, but
they don`t, because, presumably, there`s more there than people feel
willing to share.

David Samson is -- it`s so amazing to me that this guy is still the
chair of the Port Authority, I mean, really, after everything that`s
happened. You have the fact that he`s being now subpoenaed. The Port
Authority is being subpoenaed by the federal prosecutors. How does David
Samson still have the same position he had on January 1?

M. HAYES: Well, he`s appointed by the governor, and the governor
hasn`t asked him to leave that we know of yet. And he hasn`t offered to
put the nails in his shoes.

But he was at today`s Port Authority meeting, actually. He did recuse
himself and walk out of the room, because he said, you know, this is
something that I haven`t been participating in. I have a conflict of
interest here. And he actually walked out of the room, which is the first
time I believe he`s ever done that. They usually just sit up there and
just don`t vote.

C. HAYES: Well, that`s the thing.

There have been other cases in which he`s either recused himself under
pressure, after people brought attention, or in which he`s not voted. But
as we have documented time and time again on this show, the entire -- he
has this nexus of conflict of interest, even if he`s the most upstanding
dude in the world.

HERBERT: But that`s the problem. We don`t know what Christie wants
to do.

But you have to be very careful about shoving that kind of an insider
overboard. This is the kind of person that knows just about everything.

C. HAYES: This -- there`s a back and forth now. There`s the
inspector general looking into those Stronger than the Storm ads, that
those ads -- that contract with the ads with the governor specifically, I
should note, were $5 million. It was $25 million for the entire tourism...

M. HAYES: Campaign.

C. HAYES: ... contract campaign.

What is the political mood of people`s feeling about Sandy recovery in
the state right now?

M. HAYES: Well, I mean, there`s a lot of Sandy victims who were very
upset about his appearance in the ad. They don`t feel that he should have
been in them. They feel that everyday average people or perhaps business
owners down the shore should have been in them.

His candidate -- his opponent last year, Barbara Buono, tried to make
a huge deal out of this. I do think there is one thing we need to clarify,
though. The overall MWW proposal was $1.5 million less than the other

C. HAYES: Right.

M. HAYES: It was just their labor costs that were higher, and that`s
what she was attacking them for.

But it was a reelection year. So, there`s a lot of questions as to
why he was in these ads and whether or not it was to benefit his reelection
campaign. So, the Democrats have been all over this since last year.

C. HAYES: Do you think it`s possible to just kind of -- I`m always
fascinated by the kind of didn`t physics of scandal. And it strikes me as
the strategy here is, wait it out, go back to being Chris Christie, people
get tired, they will go on to something else, plane, or whatever sort of
occupies the news cycle.


C. HAYES: Can that work?

HERBERT: No, it can`t work.

I mean, you described it at the top of the segment. There are these
ebbs and flows. And right now, we`re in the period that you could describe
as an ebb. But as soon as one of the big names shows up for a hearing or
if someone else takes the Fifth or there`s some new revelation or that sort
of thing, boom, it`s back in the headlines again.

C. HAYES: Exactly, or if someone rolls over...


C. HAYES: ... which is also very likely.

Bob Herbert from Demos, Melissa Hayes from "The Bergen Record," thank
you both.

All right, why is Governor Chris Christie a favorite of New York hedge
fund managers? One possible answer when we return.


C. HAYES: Well, hello there, friends, INNers and viewers.

Join me online tomorrow when I will be answering your questions at
3:00 p.m. Eastern. Let`s meet at, shall we? I will see
you there. You can get ask me anything. No guarantees I will answer, but
certainly worth a try.


C. HAYES: Fun fact about New Jersey under Governor Chris Christie.

Of all the states in the union, only has a higher allocation of its
pension funds invested in hedge funds. Also, Governor Chris Christie
happens to be a favorite of New York hedge fund managers, who have donated
heavily to his campaign.

This got investigator reporter Lee Fang thinking. And he dug up might
surprise you.

Joining me now, Lee Fang, my colleague at "The Nation," where`s a
contributing writer.

All right, Lee, look, I have heard that hedge funds have huge returns,
they`re awesome. Why is it at all -- a red flag at all? Why isn`t it
awesome that New Jersey has tons of money in hedge funds?

LEE FANG, "THE NATION": Well, I think there`s academic research on
both the right and left that shows that pension funds that invest in more
conservative strategies, index funds, equities, just the S&P 500, perform
better than on hedge -- than with hedge funds.

And hedge funds and other alternative investments have huge fees
associated with them, so, even when they do return a high value, that`s
eaten away by these fees.

C. HAYES: Now, you write in the article that there`s a connection
between some of the folks that money is going to, particularly the fees,
and some of Chris Christie`s big backers.

FANG: That`s right.

When Chris Christie came into office in 2009, one of the -- or in 2010
-- one of the things he did was to point folks to the investment council
that voted to double the allocation of New Jersey`s pension fund to these
alternatives, hedge funds, private equity.

Some of these folks who received these very lucrative contracts with
again, large fees, were Christie`s backers, folks who contributed very
large amounts to the Republican Governors Association, the outside spending
group that helped elect Christie, helped reelect him last year, and now
Chris Christie is the chairman of that organization.

C. HAYES: There`s a guy, Chris Tobe, you quote. He`s a former
trustee of Kentucky Retirement Systems. He estimates the outside money
managers for the alternative investment program earned about $1.2 billion
in management and performance fees from New Jersey public pension plan just
in 2013. "No wonder Wall Street loves Christie."

FANG: That`s right. It`s a lot of money.

Some of these folks, Paul Singer, Daniel Loeb, they are very
politically active. "The New York Times" reported that they were part of
the kind of draft Chris Christie for president committee. And they have
won these contracts, these pension contracts. And they received millions
of dollars in fees, regardless of the performance of their funds. So,
they`re helping Chris Christie`s political career and receiving a lot of

C. HAYES: What amazing is that this was actually a campaign issue for
Chris Christie against Jon Corzine, when he ran against him, basically, he
and some of his surrogates saying Jon Corzine is stuffing the pockets of
his wealthy fat cat friends in Wall Street.

As soon as Christie wins in 2009, just before he takes office, he
sends a memo to Governor Corzine outlining 14 action urgent action items,
of them for a firm seeking investments from the state`s $68 billion pension
fund. Item number 11, he said freeze the retention of all new outside
professionals, manager selections, and new contracts for managing
alternative investments -- that`s what you`re talking about -- with respect
to New Jersey`s pension funds.

This looks like he`s saying, red light, hold on the brakes, don`t do
this. He gets in office and then just finds a way for that money to go to
the people he prefers it go to, apparently.

FANG: That`s what it looks like, Chris.

When Chris Christie got -- when he was campaigning, he harshly
criticized the alternatives program under Corzine, who began those types of

But then, when he got into office, Christie appointed folks who
doubled the allocation. His friend from high school Bob Grady, a chief
Christie strategist, was put at the head of the council that made these

C. HAYES: So, this was a guy that Christie went to high school with,
was in some ways a kind of political partner from way back. He`s the guy
that`s the head of the council that decides where this money goes?

FANG: I`m having an audio issue.


C. HAYES: OK. I`m going to take that as a yes, because I read the

Lee Fang from "The Nation," thank you.

FANG: Sorry about that. I can`t hear you.

C. HAYES: No sweat.

Thanks a lot for joining me tonight. That is ALL IN for this evening,
ending a little early on an audio issue.


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