THE RACHEL MADDOW SHOW
April 22, 2014
Guests: Neal Katyal, Elizabeth Warren
RACHEL MADDOW, MSNBC HOST: Good evening, Chris. And thank you for
accepting the onesie from my mom for your new son.
CHRIS HAYES, "ALL IN" HOST: It is the cutest most adorable thing in
the universe. I cannot wait. I`m going to run home and show it Kate and
put it on him tonight, and there will be a picture on your iPhone soon.
MADDOW: Thank you.
It`s weird. You know, here, it`s from my mom -- I don`t. Oh, I
wasn`t here. Anyway, thanks, Chris.
And thanks to you at home for enjoying us at this hour. It is really
All right. This is a story about lawyering. This is a story that
starts with this man. His name is John Errol Ferguson.
And when John Errol Ferguson was executed in Florida in August, he was
not worried about dying. He had explained to his attorneys that he would
be returning to Earth right after his execution because he knew that God
had a plan to use him to save the United States from a communist plot.
Mr. Ferguson`s last words before the state of Florida put him to death
were these. He said, quote, "I just want everyone to know that I am the
prince of God." And then they killed him after he had spent 35 years on
death row in Florida.
John Ferguson was convicted of one of the worst mass murders in
Florida history. He dressed up like a utility worker to get access to a
home in Carroll City, Florida, that he wanted to rob. Things went horribly
wrong with that robbery and he and his two accomplices ended up tying up
and blindfolding eight people in the house and shooting all of them
execution-style. Six of the eight people who they shot died.
He was under indictment for that mass murder when he killed two more
people. A young couple who he snuck up on while dressed as a cop. He
robbed and raped and killed them.
Beyond those eight murders, Mr. Ferguson was further suspected of
other murders in Florida at the time, but convicting him of killing eight
people was obviously enough to put him on death row.
His accomplices from the 1977 murders, they were executed long before
he was. But it was questions, the good questions about John Ferguson`s
mental health or lack thereof that kept him alive long after his
accomplices got executed.
And those questions about whether or not he was too insane to
understand what he did when he killed all those people. Questions of
whether his -- the doubts about his sanity should be enough to get him off
death row and convert his sentence to life in prison maybe. Those
questions were litigated on his behalf in part by this man, John Roberts,
who disclosed his work on John Errol Ferguson`s behalf when he was
nominated by George W. Bush to be chief justice of the Supreme Court of the
Now, nobody ever contended that John Roberts was soft on mass murder
or that he somehow sympathized with John Errol Ferguson for having done
that work on that case. John Roberts was a high-end, very skilled
attorney, working for a highfalutin law firm.
And in that capacity, he ended up working on all sorts of cases. Not
just the Florida death row case, the mass murderer. He also did work on
behalf of gay rights activists at one point in his career. He represented
a large group of welfare recipients in Washington, D.C. Chief Justice
William Rehnquist once assigned John Roberts, the lawyer, to represent a
guy convicted of Medicare fraud.
And none of those cases mean that John Roberts likes Medicare fraud or
welfare or gay rights. In fact, there`s evidence he does not like any of
those things. But he is a lawyer. And the Sixth Amendment to the United
States Constitution provides that in our legal system, the accused all have
the right to the assistance of legal counsel, all of the accused. Even
when what you`re accused of is something very, very bad or something your
lawyer very much disagrees with.
The defense lawyer for British soldiers who were accused of murder in
the Boston massacre in 1770, remember the Boston massacre from history
class, Crispus Attucks, and all the rest of it? The defense lawyer for the
British soldiers accused in the Boston massacre was John Adams. He
volunteered to defend them when no one else would. And he, of course, went
on to become the second president of the United States.
John Adams gave those British soldiers an impassioned defense and
successful one. And he later said this, quote, "The part I took in defense
of Captain Preston and the soldiers procured me anxiety. It was however
one of the most gallant, generous, manly and disinterested acts of my whole
life and one of the best pieces of service I ever rendered my country."
What he did is such an American value. It`s such an American
sentiment that it predates America. I mean, that was 1770 was that trial.
And John Adams` service in stepping up and agreeing to defend the other
side defending the very unpopular Brits in that massacre case, that was a
particularly hard decision considering what was going on in the country at
the time. But John Adams ended up being very proud of that decision and
the country ended up being proud of John Adams for doing it.
A hundred years after the Boston massacre, in 1870, they reprinted the
account of the trial with the addition of previously unpublished documents
and explanatory notes from John Adams. John Adams, the hero of the Boston
massacre trial, because he stepped up to defend the unpopular British
soldiers. He didn`t have to side with the British empire against the
American colonists in order to recognize that John Adams did the right
thing as a lawyer when he took that case.
This is a basic and fundamental American value that persists lo these
(BEGIN VIDEO CLIP)
CHIEF JUSTICE JOHN ROBERTS, SUPREME COURT: I`m sure there are clients
that I have represented in court that you would agree with. You would say
that`s the right side of the cause to be on, whether it`s the environmental
interests I represented in the Tahoe case, whether it`s the welfare
recipients I represented pro bono in the Bivens case, whether it`s the
environmental interests in Glacier Bay that I represented or in the Grand
Canyon on a pro bono basis. I`m sure I could go down my list of clients
and find clients that you would say that`s the right side, that`s the cause
of justice. And there are others with whom you disagree.
My point is simply this: that in representing clients in serving as a
lawyer, it`s not my job to decide whether that`s a good idea or a bad idea.
The job of the lawyer is to articulate the legal arguments on behalf of the
(END VIDEO CLIP)
MADDOW: The vote to confirm John Roberts as chief justice of the
Supreme Court was 78-22. And he remains today the chief justice of the
Supreme Court. He was nominated by President George W. Bush, of course.
And during the George W. Bush administration, the marquee legal issues of
that era were obviously on national security issues, really fundamental,
really big picture questions.
Can the United States government lock someone up forever without
putting him on trial? Bush administration tried to create a whole new
legal system where you would not be allowed to see the evidence against
you, they could use hearsay against you, and they could torture you into
saying things that would be used against you. I mean, there`s not radical
new ideas from the U.S. government. And the U.S. government did not just
offer them as policy suggestions, they started doing this stuff.
And then the best lawyers in the country scrambled and ended up
working on these new legal questions that were posed by the government`s
totally radical and unprecedented actions. And to work on those
constitutional questions did not mean that you were siding with the
defendants or the prisoners in those terrorism cases. It meant you were
arguing the points of the law. You were arguing a whole new legal field
that had been created by the actions of the government. You were working
to define what is legal under the United States Constitution.
By a few years into that era in our country`s legal history, the best
it could tell of the 50 largest law firms in the United States, at least 34
of the 50 were involved somehow in representing or advocating for people
caught up in this new basically fake justice system that the government
invented under the Bush administration -- 34 of the 50 biggest law firms in
the country. Not to mention the best military lawyers in the country and
most of the best constitutional lawyers in the country.
When important matters of law are being debated, good lawyers get
involved in those cases. And that is not a scandal. That is the way it`s
supposed to be.
There was a little hiccup on that, though, in 2007, when this man --
at the time the deputy assistant for detainee affairs -- he got a little
carried away on a talk radio program in Washington, D.C. His name was
Charles Stimson. As a serving assistant secretary of defense, he went on a
talk show in D.C. and suggested it was a scandal that lawyers were involved
in these cases. He said it was a scandal that some of the nation`s top law
firms and lawyers were involved in litigating these new questions around
prisoners and the war on terror. He suggested that maybe corporate America
should start boycotting all the big law firms who are letting their lawyers
work on these constitutional cases -- which honestly forgive me but is an
Unless you think John Adams was a Benedict Arnold, right, for
representing those Brits. How dare he? Unless you think John Roberts is
how on the side of a mass murderer because he took part in a case that
related to a mass murder.
It was a ridiculous argument to say it was a scandal, that there were
lawyers and American law firms in litigating these cases around the rights
of detainees at Guantanamo and the other things the Bush administration
were doing. It was a ridiculous argument. And to his credit, Mr. Stimson
quickly figured out that he made a ridiculous argument.
After he made these initial comments on that talk radio show and he
listed off the names of a dozen law firms that should be boycotted by
corporate America, after he did that, the attorney general at the time,
Alberto Gonzales, he came out and he said he disagreed. He said, quote,
"Good lawyers representing the detainees is the best way to ensure justice
is done in these cases."
The American Bar Association put out a horrified statement, they put
out the statement reminding everybody that, yes, in America, every accused
person deserves adequate legal representation. Even Mr. Stimson`s
colleagues at the Pentagon recoiled at what he said on that radio show in
2007. Unnamed senior Pentagon officials said at the time the comments,
quote, "do not represent the views of the Defense Department or the
thinking of its leadership."
Eventually, Mr. Stimson realized that he had done something dumb. He
published an abject apology in "The Washington Post." And within three
weeks of his initial remarks, he had resigned from his job at the Pentagon.
The issue, though, of trying to make it scandalous that bad guys get
lawyers in America, even though that is a fundamental American value that
has been celebrated for centuries, even though it is an American value
that`s been celebrated for centuries, it crops up as if it is a scandal
every few years. Every few years, it just comes around when people forget
that it is something that we do in the United States and we have since even
before our founding and they decide that they`re scandalized by it again
until someone reminds them how dumb that argument is.
I mean, it was 2007 when Mr. Stimson had to resign over screwing up
this issue at the Pentagon. It was two years later in 2009 when the guy
who stepped in it was named Charles Grassley.
(BEGIN VIDEO CLIP)
SEN. CHARLES E. GRASSLEY (R-IA), JUDICIARY COMMITTEE: Would you
provide me and members of the committee with the following information, the
names of political appointees in your department who represent detainees or
who work for organizations advocating on their behalf.
(END VIDEO CLIP)
MADDOW: After Barack Obama became president and Eric Holder became
attorney general, it was Republican Senator Chuck Grassley of Iowa who in
2009 decided to try to make an issue out of the fact that some of the
constitutional lawyers who had argued on these detainee issues -- heaven
forbid -- were now getting jobs in the new administration. I mean, to be
fair, the Bush administration had also hired a bunch of high-end
constitutional lawyers who had argued on these issues, and the Republicans
weren`t scandalized by the Bush administration hiring them.
But with this new president and with Eric Holder sitting there, Chuck
Grassley got confused which country he works in and decided to try to turn
it into a scandal that lawyers who worked on detainee issues were getting
government jobs. Chuck Grassley started it and then Liz Cheney was the one
who pumped it up to 11.
Liz Cheney in 2009 founded a group called Keep America Safe. That
group ran these ads attacking lawyers who are argued in the cases about
Guantanamo, attacking the lawyers as if they themselves were terrorists for
having taken part in those cases.
Literally, they called the lawyers the al Qaeda Seven as if the
lawyers themselves were in al Qaeda by virtue of the fact they made legal
arguments in cases that related to terrorism.
Look at this. At one point they flashed this headline from something
called "Investors Business Daily. DOJ, department of jihad? It`s not the
Department of Justice anymore, it`s the department of jihad. Yes.
Now, the right wing press was eager to help out Ms. Cheney in this
regard. "The National Review" called the lawyers terrorist sympathizers.
When Liz Cheney`s group asked in its ad, who are the al Qaeda Seven, the
FOX News Channel jumped to come up with the answer. They dug up what they
said were the names of these lawyers who had done the scandalous work on
these detainee cases. Right wing blogs ran with that story short-handing
these constitutional lawyers as the terrorist attorneys.
There was this brief moment of excitement in the conservative media in
the spring of 2010 around this issue, and the right was basically
denouncing the whole U.S. government as an arm of al Qaeda. Look, the
terrorist attorneys are here.
The right wing media loved this for that hot minute back in the spring
of 2010. The media loved it. But then even the right wing lawyers were
like, you know what? We may be conservative, but hold on a minute.
A group of prominent conservative lawyers including nine former Bush
administration officials and Ken Star and a founder of the Federalist
Society, a former general counsel from the Pentagon, former chief counsel
to the National Security Council under George W. Bush, they released an
outraged statement calling attacks on these lawyers shameful, saying they
undermine the American justice system. Even Michael Mukasey, the hardliner
who had been attorney general under George W. Bush, he wrote an op-ed in
"The Wall Street Journal", calling it shoddy and dangerous to attack
lawyers on the basis of the clients they represent.
The backlash was loud against Liz Cheney and what she did there, and
the backlash was rather devastating. I should note now that Liz Cheney`s
little group Keep America Safe does not exist anymore. I don`t know they
ever announced they were going away, but they seemed to have gone away.
Even though every time somebody makes an attack like this it
boomerangs on them and embarrasses them, right, because bad people having
lawyers isn`t a bad thing. It`s a good thing. Even though it always
boomerangs or at least before now it has always resulted in some sort of
backlash whenever people have made this dumb attack, this dumb attack does
roll around every few years ago anyway.
And so, last month it did come around again. It came around this
nominee. President Obama nominated this lawyer, Debo Adegbile, to be the
head of civil rights division at the Department of Justice. As part of his
work as civil rights attorney he had argued that a death sentence had been
improperly imposed on one defendant because of bad jury instructions.
Mr. Adegbile`s argument, it turns out, was correct -- at least the
mostly Republican-appointed judges on the appeals court who heard that
case, they agreed with his reasoning. They agreed that the jury
instruction were improper, and they agreed, in fact, that the death
sentence was therefore improperly laid and the death sentence was commuted
to life in prison.
But the fact that Debo Adegbile agreed to play any role in those legal
arguments on FOX News, they turned that into this.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: The Fraternal Order of Police slammed the White
House for nominating a cop killer`s coddler to a top job at the Justice
(END VIDEO CLIP)
MADDOW: A cop killer`s coddler, points for actually being able to
pronounce that on television.
These arguments where lawyers blamed for participating in the legal
system, they do come around every few years and they are always dumb. But
when it happened around the Debo Adegbile nomination in the last few
months, this time, there wasn`t a right wing legal backlash. Every
Republican in the United States Senate sided with FOX News on this and
voted against this nominee, every single one of them, apparently on the
basis of this FOX News hyped argument that assisting on the defense of
someone who killed a police officer is basically the same as killing a
police officer yourself. Every Republican in the Senate voted against him
and seven Democrats did too.
(BEGIN VIDEO CLIP)
SEN. TOM HARKIN (D), IOWA: Earlier today, a vote was taken in the
United States Senate that to this senator marked about the lowest point
that I think this Senate has descended into in my 30 years here. I don`t
say that lightly.
Here`s the message we sent today. You young people listen up. If you
are a young white person and you go to work for a law firm, you`re a lawyer
sworn into the bar.
You go to work for a law firm. You`re a young white person. And that
law firm assigns you to a pro-bono case to defend someone who killed eight
people in cold blood. And they assigned you to defend that person.
My advice from this what happened today is you should do that. It`s
part of your legal obligation, part of your profession. Because if you do
that, who knows, you might wind up to be the chief justice of the United
States Supreme Court.
However, if you are a young black person and you go to work for the
NAACP Legal Defense Fund, they assign you to appeal a case of someone who
committed a heinous murder. If you`re a young black person and work for
the NAACP Legal Defense Fund and asked to sign an appeal for someone
convicted of murder, what the message said today is don`t do it. Don`t do
(END VIDEO CLIP)
MADDOW: There was backlash by conservative attorneys when right wing
activists and the media tried to say that any lawyer who worked on a
terrorism case by definition was a terrorist or at least a terrorist
sympathizer. There was no conservative backlash against the right wing
effort to do the same thing to this Obama administration nominee for his
work in criminal defense.
President Obama issued a statement after the Debo Adegbile vote,
calling it a travesty based on wildly unfair character attacks. The
president said in his statement, quote, "The fact that his nomination was
based solely on his legal representation of a defendant runs contrary to a
fundamental principle of our system of justice." True.
But that nomination was defeated and now we`ve got one more test case
as of today as to whether or not the American right does still believe that
the American legal system is a good thing. That it`s a good idea. That
it`s now a scandal that bad guys get lawyers.
It`s not a scandal what John Adams did at the Boston massacre. That
was something noble. And what John Roberts did with that murderer in death
row in Florida. That should not disqualify him from a higher office.
We get another test case on this today. How will the right react?
The latest one of these attacks trying to make it a scandal that a lawyer
participated in the legal process, it was launched today. It`s same
argument they always make. Only this time, it was not Liz Cheney making
the argument. This time, it was not just the FOX News Channel making the
This time it was Chris Christie, kind of, who is a lawyer. And that
MADDOW: Senator Elizabeth Warren of Massachusetts is going to be here
on set for the interview tonight. And that`s coming up in just a couple of
minutes. Stay with us.
MADDOW: Today in South Carolina, the Republican Governors Association
touted a new ad they`re running against the Democrat to unseat South
Carolina Governor Nikki Haley. His name is Vincent Sheheen. He`s a former
prosecutor but he also worked on the defense side in both criminal and
civil legal cases.
This latest ad the Republicans have just unveiled against him attacks
him basically for the crime of being a lawyer who represents people accused
It`s a basic American principle that even bad guys, especially bad
guys, get good lawyers. And some of the best and most revered lawyers in
the nation have represented people accused of the worst things possible.
That is not a bug in our system. That is a feature.
But this recurring attack on lawyers for participating in our legal
system, as of today, it`s back. The Republican Governors Association, you
may know, is headed by New Jersey Governor Chris Christie, who himself has
hired some pretty good defense attorneys recently. So, you think he might
be sensitive on the subject of attacking the American legal process.
But so far, this ad from the Republican Governors Association has not
engendered any sort of political backlash. These kinds of attacks have
been around for a very long time. They`ve been around for centuries, as
long as we`ve had some semblance of an American legal system.
But these attacks in the past used to be embarrassing to the people
who did them. They used to be the cause of a backlash when they happened.
Have we outgrown that capacity for shame? Are these kind of attacks
either now so common or conveniently partisan that we are becoming inured
to them? And if so, is that dangerous for the help of our legal system and
for the good lawyers that it needs on both sides if it`s going to work
Joining us now is a veteran on these kinds of attacks, the former
deputy solicitor general who before he was appointed to the Justice
Department successfully argued one of the landmark enemy combatant cases
before the Supreme Court and was politically attacked for having done so.
Neal Katyal is now a constitutional law professor at Georgetown.
Mr. Katyal, thank you so much for being with us.
NEAL KATYAL, GEORGETOWN: Thank you.
MADDOW: So, you were politically targeted because you worked with
prisoners at Guantanamo. And American justice system obviously predicated
on everybody getting a good lawyer, everybody being innocent until proven
Are you surprised that these attacks don`t ever go away?
KATYAL: Well, I mean, I think as you point out it`s a basic American
value from John Adams in 1770 to John Roberts in 2005, that we don`t
confuse the lawyer with the client. The sins of the client shouldn`t be
attributed to the lawyer.
However, we seen lots of recent instances of it, you know, over the
last couple decades. Some of those are really overt like the ad you
mentioned today, but some of them are not overt. Some of them occur in the
shadows. And it`s not a political issue. It`s not the right does this
only to the liberal lawyers on the left.
I mean, I think it`s an open secret in this town that the organized
left has done that to a bunch of nominees in the Obama administration or
would-be nominees as well based on the clients they represent. So, it`s a
repeating pattern that we see. And I think it`s something that really
should be talking about because it is as corrosive an idea as you can
imagine to the idea of due process under law that we`re going to go after
and attack lawyers because of the clients they represent.
MADDOW: When you say it corrosive, how does it -- how does it hurt?
Is in a sort of chilling effect on whether or not even unpopular causes or
unpopular clients can get good representation because ambitious lawyers
don`t want to be held accountable for that?
KATYAL: Absolutely. You know, I see it all the time. I`ve seen
three different vantage points, you know, both as a pro bono law professor
before the Supreme Court, as the government`s top lawyer before the Supreme
Court, and now in private practice before the Supreme Court.
And all three of these, I`ve seen that in those tough controversial
cases, sometimes they don`t get good lawyers. And it does hurt. You know,
it`s not a surprise that our founders put the Sixth Amendment into the
Constitution guaranteeing a right to counsel.
The whole idea was, yeah, who you hire as a lawyer matters. Everyone
knows that when they`re in trouble. If you can drum out people and scare
them -- particularly the best people, that`s when it gets really
MADDOW: The thing that I -- I guess, politically feel about problems
with the way lawyers get talked about is that lawyers are pretty good at
sticking up for themselves. Lawyers are really good advocates by
Why isn`t the legal profession better at defending against these kinds
of attacks? I feel like in the last few years, we`ve gotten worse at it.
There used to be more of sort of a bipartisan or non-partisan attacks like
this on the system and I`m sort of feeling like it`s eroding.
KATYAL: Yes. That`s a great point. I mean, I have to say that when
during the lowest days of the Guantanamo work I was doing in the mid-2000s,
Ted Olson who was the solicitor general at the time, came to me and said he
was upset about them. And actually, we wrote an op-ed together deploring
It was Ted Olson who lost his wife in the attacks on September 11th,
and he came forward on his own before it was popular, before people were
talking about it and said this isn`t the way our system works.
And I think it`s incumbent on all of us as lawyers and the bar and
legal profession generally to stand up for these folks, whether it`s the
good man Debo Adegbile, who`s been attacked, or this candidate in South
This is not about politics. This is about a simple principle. Do you
want to go into a Stalinistic regime where the best lawyers get scared or
gets threatened with sanctions or who knows what else, or do you want a
system where the best come forward and help the court figure out those hard
And that`s true, whether it`s labor case or an environmental case or
MADDOW: Neal Katyal, professor at Georgetown University, former
acting solicitor general -- thanks very much for helping us. I don`t know
if this ad campaign is going to become a scandal but for totally non-
partisan reasons, I hope it does for the reasons you articulated. Thanks
for being here.
KATYAL: Thank you.
MADDOW: Thank you.
All right. Straight ahead, on the interview tonight, it`s U.S.
Senator Elizabeth Warren. She`s right here.
Stay with us.
(BEGIN VIDEO CLIP)
SEN. ELIZABETH WARREN (D), MASSACHUSETTS: There is nobody in this
country who got rich on his own. Nobody.
You built a factory out there, good for you. But I want to be clear.
You moved your goods to market on the roads the rest of us paid for. You
hired workers the rest of us paid to educate.
You were safe in your factory because of police forces and fire forces
that the rest of us paid for. You didn`t have to worry that bans would
come and seize everything at your factory and hire someone to protect
against this because of the work the rest of us did.
Now, look -- you built a factory and it turned into something terrific
or a great idea, God bless. Keep a big hunk of it. But part of the
underlying social contract is you take a hunk of that and pay forward for
the next kid who comes along.
(END VIDEO CLIP)
MADDOW: Elizabeth Warren, she`s here live and in person, next.
MADDOW: Here is Elizabeth Warren approximately 24 years ago before
she became one of the most recognizable and admired figures in American
liberalism and Democratic Party before she was famous for anything. This
was Elizabeth Warren when she was just the lady you called in to explain
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Ms. Warren, let`s talk about how bankruptcy
works. There is Chapter 13 bankruptcy and Chapter 7 bankruptcy for
personal bankruptcy. Briefly give us the overview.
WARREN: That`s right. In Chapter 7, a debtor says, that`s it, I
can`t do anymore. And all of the debtor`s assets are put into an estate in
bankruptcy. The court then administers that estate. If the debtor has any
exemptions in excess of a federal or state mandated minimum, the debtor
then, those assets are sold off and distributed to the creditors.
(END VIDEO CLIP)
MADDOW: That was Elizabeth Warren on the "Today" show 24 years ago
almost exactly. She`s being very accurate and to the point but also
speaking very technically.
Over time, she got really, really good at talking to bigger and bigger
groups of people. Eventually, she would become better than anyone in the
country at expressing the idea our economy was tilting off its axis in a
whole new way, that a predatory sector was hunting for American customers
basically to lure them into its web and then crush them with debt.
(BEGIN VIDEO CLIP)
REPORTER: College for many, the first taste of freedom and
responsibility. And for some, easy money and big debts.
UNIDENTIFIED MALE: Free gift for a Citibank card.
REPORTER: Lured by cheap giveaways, pens, CD holders, college kids
can get credit cards easily. The average freshman is inundated with more
than 50 solicitations in the first few months away from home.
WARREN: We`re talking about young people who are beginning their
lives -- their professional careers and starting families by declaring
themselves financial failure, because of the debt they`ve run up while
they`re in college.
(END VIDEO CLIP)
MADDOW: If you ever went to college and got one of those credit card
offers at the school post office or in your e-mail, Elizabeth Warren was
thinking about you even way back in the `90s. In the run-up to the 2004
Bush v. Kerry presidential campaign, Democrats knew that they desperately
needed a message about economic opportunities and haves and have-nots.
And Democrats in Washington came upon this accessible new book by a
Harvard professor. The central argument of the two income trap was that
American families were maxing out economically, not by trying to do
anything extraordinary, but just by trying to stay in the middle class.
And by that time, by 2004, Elizabeth Warren really was an expert at
extrapolating from the nitty-gritty lived details of our lives to explain
these broader things about how stuff was stacked against us. How stuff was
stacked against average American families just trying to get by.
(BEGIN VIDEO CLIP)
WARREN: What`s happened in the United States is that families with
children believe that the number of places that they can buy homes and
still send their children to public schools is shrinking. And so, families
are bidding on prices in places with decent school districts. And the
consequence is their mortgage as a proportion of their total income is
reaching way out of proportion.
At a time when the average male`s wages have not increased by a full 1
percent, the amount of family is spending on mortgages has gone up 69
(END VIDEO CLIP)
MADDOW: That was Elizabeth Warren 10 years ago this month. And she
was right. She was right that Americans were being priced out of our own
lives. She was right that wages had gone flat and she ended up being right
that the banking industry was doing something unsustainable and
unsupportable by the facts. And that it would collapse when this housing
bubble thing finally blew up. Elizabeth Warren was right about that.
And she was right way back then about your student loan and mine.
When she said, "This next generation is starting their economic race 50
yards behind the starting line. They`ve got to pay off the equivalent of
one full mortgage before they make it to flat broke in order to pay for
their education. They can never get ahead of the game because they`re
constantly trying to play catch-up."
She said, "It`s just staggering to me this is not part of our national
debate right now."
Elizabeth Warren was talking about that in 2004. And, of course, the
nation is finally talking about that problem right now, but that`s in part
because there`s a new consumer agency in Washington that keeps cracking
down on what is nuts and scammy about our stupid student loan system. And
the reason that`s happening is because there is now a federal agency in
Washington that`s tasked with trying to protect consumers from the ways
that banks and credit card companies and mortgage lenders and student loan
lenders have really been scamming us all these years.
That federal agency did not exist until Elizabeth Warren thought it
up. And then teamed up with Democrats in congress and President Obama to
get it created by law and the president forced through the appointment of a
director for that agency and a lot of people expected that the president
would pick Elizabeth Warren herself for that job, but he didn`t. She was
disappointed about that. You can read all about it in her brand new book.
Instead of moping about it, though, she went on to do something rather
bigger. She went on to drum senator hedge fund himself, Scott Brown, out
of his Massachusetts Senate seat in 2012.
Well, this week Senator Warren is releasing a new book called "A
Fighting Chance", about her battle to reform Wall Street. She writes,
"Change is hard but it is possible. That`s the part that fires me up."
She says, "There are many more fights to come and much more work to be
done. I worry that we`re running out of time."
It is the kind of thing you`d read in a book by a politician
reintroducing herself for whatever reason. Senator Warren insists she`s
not running for president, so I`m not going to badger her about that. But
now we get to ask her what she is doing and what she is planning in this
Joining us now for the interview is Elizabeth Warren, Democratic
senator from Massachusetts.
Senator Warren, I was trying to embarrass you.
WARREN: You did.
MADDOW: Oh, good.
WARREN: You did.
MADDOW: It`s hard to look at old tape of ones self, but you have been
making consistent arguments for a long time on subjects.
WARREN: Well, this is what I see. This is what I really believe in.
For me, I was thinking about this as you were doing it. I grew up in
a family that was really kind of out there on the ragged edges of the
middle class. My dad ended up as a maintenance man. My mom worked minimum
wage job at Sears and I ended up in the United States Senate.
How does something like that happen? Well, partly it happens because
I went to public school, public university, a commuter college that cost
$50 a semester.
I grew up in an America that was investing in its kids. An America
that said, you know, if you work hard, if you get out there and play by the
rules, we`re going to make a public school alternative that is affordable
and will give you a great education. And that opened a million doors for
And what -- the reason I keep fighting now is we used those
opportunities back then to build a strong and robust middle class, really
basically from the Great Depression until about the 1980s. We built that
middle class. We built our hopes and dreams in it.
And then you hit the 1980s. And instead it starts to shift.
The Republicans say, you know, what we really have to do is we`ve got
to open up a bunch of tax loopholes and the way we`re going to pay for that
is we`re going to cut back on what we spend on educating our kids. We`re
going to cut back on funding basic infrastructure, those roads and bridges
and power grids that let businesses get started and move forward. We`re
going to cut back on funding basic research in this country, that great
pipeline of ideas that had built so much innovation and creation.
And so, we end up in an America today where most kids can`t pay for
college. Mom and dad cannot afford to write a check that`s going to get
them through college.
So, what happens? The American government says we`re going to lend
you the money to go to college, but they don`t actually spell out what`s
going to happen next. You`re going to pay back the cost of the funds.
You`re going to pay back the bad debts, covering that, the administrative
And then if you`re on undergrad, we`re going to charge you nearly
double the amount you would have to do to cover all those costs, so that
the United States government can make tens of billions of dollars in
profits off the backs of our kids. That is obscene. And what it does is
it further makes it tough for any kid to get a fighting chance.
So, that`s the heart of what this book is about for me, it`s the work
I`ve been doing all along. And it`s the work I`m going to keep on.
MADDOW: The first piece of legislation that you filed when you got to
Washington was on that student loan issue.
MADDOW: And we have to take a quick break, but when we come back I
want to talk to you about whether or not the time you`ve spent in
Washington makes you realize what you have to do win on that that you did
not win when you first brought it up.
Can you hold on?
MADDOW: We`ll be right back with Senator Elizabeth Warren.
(BEGIN VIDEO CLIP)
WARREN: It seems to me we are taxing students for the privilege of
borrowing money to try to get an education. I think that`s obscene. I
don`t think the student loan program should be designed, so that it`s
making profits for the federal government. I think it is obscene for the
federal government to be making profits like this measured in billions of
dollars off the backs of our students.
(END VIDEO CLIP)
MADDOW: Senator Elizabeth Warren of Massachusetts trying mightily to
upset the apple cart on the issue of student loans last month in Congress.
We`re back now with Senator Warren. She has a new book out called, "A
Fighting Chance." You introduced this legislation on student loans as soon
as you got to the United States Senate. It did not become law.
Do you expect to keep fighting on the issue how will you win in the
future, given that you didn`t win in the past?
WARREN: Yes, and yes. So, it didn`t pass. But we`re going to
introduce again, next month, and this time put a slightly different
proposal on the table.
This one is going to be to deal with the $1.2 trillion in student loan
debt that it`s outstanding. This is the high interest rate debt, high for
undergrads, even higher for those who have graduate student loans, plus
And the idea is we are going to propose taking all of the debt and
refinancing it down to 3.86 percent, which is the interest rate that
Congress just said less than a year ago is the right interest rate for
student loans. So, bringing all of the student loans, the interest rate
down and then paying for it, because you got to have a pay for it on this.
Paying for it by saying we are going to close one of the big tax loopholes.
And that is, let`s pass the Buffett Rule. It shouldn`t be the case
that billionaires pay less in taxes than their secretaries. But the reason
I put it that way is because here is another way, now new look at that
The United States government can invest, it can invest in billionaires
by saying keep those big tax loopholes. Or it can invest in people who are
frying trying to get an education.
And so, what I propose we link the two things to each other. Every
dollar we pull in by closing the tax loopholes, so that we have the Buffett
Rule in place goes directly into reducing the interest rate on student
loans. We pull in more money. The interest rate goes down even further on
MADDOW: Are there any Republicans who you see on Capitol Hill who you
see a glimmer of recognition in their eye when you talk to them about these
issues. I think about my old friend Rick Santorum, with whom I had lots of
differences of opinion on policy, would love to interview some time, but he
talked about economic populism in a way that appealed to Republican
audiences in the Republican primary. It`s why he got as far as he did. I
don`t think it was being against contraception. I think it was being for
working families being able to put food on the table.
Are there populist voices, economically minded Republicans who you
think you might be able to work with on this?
WARREN: I think this is exactly what the next few months is going to
tell us. This is going to be the outreach all the way across the board on
this. Look, I wrote "A Fighting Chance" to talk about what`s happening to
America`s families. And I do it with a lot of very personal stories, kind
of behind the scenes and the fights we were in. What they were about.
But also to talk about what`s possible. To talk about the things we
should be able to agree on and win on.
And that`s why I said. So I like this idea on student loans, of
saying, look. It is all about choices. Everybody wants to talk choices.
It`s about choices.
We can choose to support billionaires or we can choose to support kids
who are trying to get an education. The way that we spend our money as a
country should reflect our values. That`s what this is really about.
MADDOW: The way that we do spend our money as a U.S. government
reflects the values of campaign contributors.
WARREN: Yes, this is the problem we`ve got. The problem is
Washington works for the big corporations. That`s exactly right, for the
billionaires. For those who can hire armies of lobbyists and lawyers.
Their voices are heard everywhere in the halls of Congress.
But what we have to remember is they have concentrated money,
concentrated power on their side. It shows up. It gives them great
But what we have on our side. We have our voices. We have our votes.
And as long as we stay active, as long as we stay engaged, we can win.
MADDOW: Is your position right now in the United States Senate a
satisfying place from which to make those arguments. Part of the reason I
want to play the old tape of you, to embarrass you. Part of it to show
that you have been making the case in a different line of work, as an
academic, as an expert, ultimately as an activist, before you`ve ever
gotten to the U.S. Senate. I think about joining the U.S. Congress as the
most frustrating thing in the world --
MADDOW: Because it doesn`t do anything.
WARREN: No. No, no, no.
You know, I talk about in this book. I do a whole chapter about
fighting to get the consumer agency. Another chapter about setting it up.
And sure, there were tons of frustration.
But remember where we were, four short years ago. There was no agency
out there to prevent the biggest financial institutions from cheating
people on credit cards, on mortgages. We got together and remember, the
banks said we will kill that agency.
In financial reform, I talk about in the book, they were spending more
than $1 million a day lobbying against financial reform. But remember, we
won. Here is the thing.
Not only did we win. We got an agency that in the short time, it`s
been alive, has already put more than $3 billion back into the pockets of
families who got cheated on mortgages and credit cards. Now, the next time
somebody tells me we can`t change anything, I have four words for them:
Consumer Financial Protection Bureau.
WARREN: We can change. We do change. All it takes is we get
organized on our side. That`s what gives our kids a fighting chance.
MADDOW: Senator Elizabeth Warren of Massachusetts. The book is
called "A Fighting Chance." And it`s a good book. It`s not a typical
politician book. It`s actually good as a book.
Thanks for being here.
WARREN: Thank you.
WARREN: Thank you.
MADDOW: We`ll be right back.
MADDOW: Thank you for being with us. I want to tell you that our
interview with Elizabeth Warren is going to be posted later tonight at
Now, it`s time for "THE LAST WORD."
Thanks for being with us. Have a great night.
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