All In with Chris Hayes, Transcript 2/2/2016

Guests:
Charlie Pierce, Ben Domenech, Harry Enten, Katrina Vanden Heuvel, Howard Dean, Keith Ellison
Transcript:

Show: ALL IN with CHRIS HAYES
Date: February 2, 2016
Guest: Charlie Pierce, Ben Domenech, Harry Enten, Katrina Vanden Heuvel,
Howard Dean, Keith Ellison

(BEGIN VIDEOTAPE)

CHRIS HAYES, MSNBC HOST (voice-over): Tonight on ALL IN –

SEN. TED CRUZ (R-TX), PRESIDENTIAL CANDIDATE: What a victory last night.

HAYES: We now know who won the votes in Iowa.

HILLARY CLINTON (D), PRESIDENTIAL CANDIDATE: There was a big turnout and
we won.

HAYES: But who is winning the narrative?

SEN. BERNIE SANDERS (I-VT), PRESIDENTIAL CANDIDATE: We just got in from
Iowa, where we astounded the world.

(CHEERS)

HAYES: Then, how does Donald Trump respond to defeat?

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: You have many, many people that
aren`t doing well. I am doing well.

HAYES: And since when is third place a victory?

SEN. MARCO RUBIO (R-FL), PRESIDENTIAL CANDIDATE: We`re incredibly grateful
and excited about all this.

HAYES: And the trouble with deciding who will lead the free world with a
coin toss.

UNIDENTIFIED MALE: Tie has been broken by a coin flip and will go to
Bernie Sanders for the delegate.

HAYES: ALL IN starts right now.

(END VIDEOTAPE)

HAYES: Well, good evening from back here in New York. I am Chris Hayes.

And now that the battle for votes in Iowa has ended, the fight for control
of the vaunted narrative begins in earnest. In terms of hard numbers, the
winners and losers are pretty straightforward. You can look them up online
or look at our fancy graphics here.

According to the state parties, Ted Cruz topped the Republican field,
followed by Donald Trump and Marco Rubio. While Hillary Clinton narrowly
eked out a victory over a rival Democrat Bernie Sanders who finished less
than a point back.

Then, there are the winners and losers determined by the political media
industrial complex based on a pretty precise combination, of reading
conventional wisdom, scoring the entrance polls and handicapping the
performance versus expectation.

No candidate seemed to have that second contest in mind more than Marco
Rubio who started spinning long before his third place finish last night
leaking his so-called three, two, one plan – third in Iowa, second in New
Hampshire, first in South Carolina, two weeks ago.

Last night he had this to say about losing to Ted Cruz and Donald Trump by
a smaller margin than polls predicted.

(BEGIN VIDEO CLIP)

RUBIO: So, this is the moment they said would never happen. For months,
for months they told us we had no chance. For months, they told us because
we offered too much optimism in the time of anger, we had no chance.

(END VIDEO CLIP)

HAYES: Wait, you didn`t read all those op-ed by they about how Rubio
couldn`t finish third in Iowa?

Now, Rubio is being crowned the real winner of last night`s Republican
contests. The establishment`s only alternative to hope to Cruz and Trump.
And with the race moving onto New Hampshire, where Rubio was on the ground
campaigning today, anything less than second place for Rubio in next week`s
primary will look like a catastrophic failure. That is now the bench mark.

While third place turned into a self-proclaimed victory for Rubio, second
place was widely seen as the end of the road for Donald Trump who`s built
his campaign on the idea that with him in charge, America will be a winner.

There was plenty of schadenfreude to go around, especially online, with an
old tweet of Trump from 2013 made the rounds, “No one remembers who came in
second.”

And this was today`s cover of one of Trump`s hometown papers, “New York
Daily News”, “Dead clown walking.”

And while it`s true that Trump fell short of his standing in recent polls,
the last dozen of which showed him leading in Iowa, we here at ALL IN would
like to take a step back, and give the Donald a little credit.

Bear with me for a second. Not only did he finish second in a state that
rewards grassroots organizing and evangelical outreach, neither of which
are his strong suit. But yesterday, for the first time, American citizens
got into their cars, and drove to their caucus sites and stood in line and
actually voted for Donald J. Trump. Real estate mogul come ethno
nationalist reality star for president of the United States.

In fact, with last night`s high turn out, he earned more votes from Iowa
Republicans than any other candidate in all of history except for one.
That`s Ted Cruz, last night.

At a caucus in Des Moines, I talked to one of those voters who was
caucusing for the first time.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I like Donald Trump. He`s not bought and paid for, you
know? I look at politicians. I might be radical here, but they`re like
horse, you know? They go out there, they show – they tell people what
they want. The donors basically hire them for services. They do with the
donors want. I like Trump because he`s his own man.

(END VIDEO CLIP)

HAYES: With his big win last night sustained by an extensive ground game
and impressive messages when Ted Cruz just became the first candidate to
take a punch from Donald Trump and successfully bounced back. And unlike
previous caucus winners, including Rick Santorum, Mike Huckabee, Cruz still
has plenty of cash on hand to fight it out in New Hampshire and beyond.

Now, on the Democratic side, after a night of counting and persuading and
navigating the state party, Hillary Clinton was finally declared the winner
by a miniscule margin of four delegates out of a total of 1,406.

Those numbers may not reflect who turned out to vote for each candidate.
In some precincts, delegates to the local county convention who elect the
other delegates up the chain were awarded through a coin toss.

Today, Bernie Sanders told reporters he`s not ready to concede the
caucuses.

(BEGIN VIDEO CLIP)

SANDERS: We want to look at it. You know, when you have – again, I was
on plane last night. I`m here right now, so we have other time to analyze
it. People in Iowa are taking a look at that. It may be the case for some
delegates were selected based on a flip of the coin but not the best way to
do democracy.

(END VIDEO CLIP)

HAYES: Clinton narrowly escaped what would have been a devastating in 2008
when she finished third behind Barack Obama and John Edwards. And while
the campaign is touting Clinton`s victory, he`s the first woman ever to win
Iowa, it`s impossible to ignore what Bernie Sanders pulled off last night.
The 74-year-old self-described Democratic socialist from Vermont who drew
comparison to protest candidates like Dennis Kucinich and Rand Paul over 50
point deficit several months ago to finish in a virtual tie with a former
secretary of state and former first lady and New York senator.

Now, heading into New Hampshire, it`s all about the expectations game and
it`s clear what message Hillary Clinton is trying to send.

(BEGIN VIDEO CLIP)

CLINTON: I was thrilled by winning and getting that boost out of Iowa here
in New Hampshire where I am in Senator Sanders backyard, as you know as a
political expert of many years. New Hampshire votes for neighbors. I have
to really get out there and make my case, which I intend to do this week.

(END VIDEO CLIP)

HAYES: Moments ago in New Hampshire where he was endorsed by former
Massachusetts Senator Scott Brown, a notably subdued Donald Trump attempted
the difficult task of lowering expectations while maintaining his signature
swagger.

(BEGIN VIDEO CLIP)

TRUMP: I`d love to finish first. Again, it would still not be horrible
because you`re competing against a lot of very talented people that have
been politicians all their lives. I`ve been a politician for six months.
But, no, I`d love to finish first.

REPORTER: Second wouldn`t be horrible.

TRUMP: Wouldn`t be horrible, but it wouldn`t be the worst thing in the
world. I can think of worst things, but I`d like to finish first.

(END VIDEO CLIP)

HAYES: Joining me now, Joan Walsh, national correspondent for “The Nation”
and an MSNBC political analyst, Charlie Pierce, writer at large for
“Esquire Magazine”, Ben Domenech, publisher of “The Federalist”.

And I think we have to start with Marco Rubio`s remarkably, effective,
hubris here. It`s almost like he`s attempting to pull a Jedi mind trick on
everyone`s who`s watching, like telling everyone I came in first when we
can all read the numbers.

But, Joan, it was – in some ways, it was effective because the benchmark
set by the polling and he did out perform polling the most of any
candidate.

JOAN WALSH, MSNBC POLITICAL ANALYST: Yes, he exceeded expectations. That
speech really did require chutzpah. As I was watching it, I was kind
laughing.

And yet it did tell us something, it told us that he came in third. It
told us that he outperform. It did set him ahead for now the other folks
in his lane, John Kasich, poor Jeb Bush who got one delegate. Chris
Christie.

But the thing that`s very tough for him is that it stays tough. Those four
guys don`t like each other. There`s no establishment to come in and knock
some heads together and say, look, Marco is our guy. He did the best.
He`s trailing. I mean, he`ll go ahead, but he`s trailing Bush and he`s
trailing Kasich in New Hampshire.

So, there`s still a fight into New Hampshire. Just claiming victory before
Ted Cruz could speak is not going to change the fact he`s still got tough
work to do in New Hampshire, and he doesn`t have people who look they are
anxious to go away. Chris Christie is still in there, calling him bubble
boy, insulting him in the way that he does best. So, it`s going to stay
very interesting for a while.

HAYES: And, Ben, I think the thing that is struck me is first of all, you
say this three, two, one idea. OK, so you got the three. That`s the
easiest of three, two one. Now, so, you have this benchmark for yourself,
the second. Ted Cruz, Ted Cruz will have a lot of momentum.

And I think if there`s one unquestionable winner last night, it`s Ted Cruz.
I mean, Ted Cruz won the night last night. He`s got the biggest margin.
He came this first. He`s got a lot of momentum. He`s got money and
betting markets which flipped Rubio and Trump without Cruz getting a bump,
I think, are insane. There`s money on the table on those betting markets
because Ted Cruz has a very good shot at nomination. Do you agree?

BEN DOMENECH, THE FEDERALIST: I agree. I think that he actually has – I
mean, you have to say he`s the front-runner. He has the best shot of the
nomination. He has the resources for it. He will go into South Carolina
probably and focus more there than New Hampshire and he has a lot of people
there who are ready to help him.

I think, though, this is situation where Marco Rubio has been all about the
meta narrative related to the establishment dollars for the past several
weeks and even months, trying to make the case, look, guys, I`m your guy.
I`m the closest thing that you can get to what you actually want. You need
to ride with me.

I think that`s really what this case was about. It`s more about speaking
to the establishment. It was funny to see him reference that line very
similar to the one that Barack Obama made back in 2008 for a third place
finish as opposed to a first place finish. That was pretty funny.

HAYES: They said it could never happen, like all these people writing
these grant, elegant dissertations, about like Marco Rubio could never find
from fourth to third in Iowa.

Charlie, on the Democratic side, you and I ran into each other on the
streets of Marshalltown, Iowa outside of Bernie Sanders launch event. You
and I were talking. I was saying my sort of private guess from what I
could glean is. I thought Hillary Clinton would win by three to five
points.

I thought they have a first rate organization in Iowa. I was skeptical
they could build the capacity to turn out people in as geographically
distributed way as they needed to. Were you surprised by last night`s
result?

CHARLIE PIERCE, ESQUIRE: First of all, Chris, my facility in the political
journal industrial complex is completely powered by clean energy. I`m just
telling you. It`s completely powered by ethanol. It`s completely powered
by ethanol, and I think I just won three votes in a caucus in Iowa
somewhere.

No, I mean, I thought this would be one of those things where you didn`t
really know who won until the next day. That`s partly because –
especially on the Democrat side, the Iowa caucuses are an insane way to
make any decision.

But I thought he was showing remarkable strength or there was a remarkable
attraction to him in different parts of the state, especially along the
Mississippi River and those old industrial towns where you`ve got very big
Catholic vote. I do think that – obviously, he would have been better off
if he won. But I think he did show more strength than people thought he
had in the last weekend where Mrs. Clinton, or, I`m sorry, Hillary Rodham
Clinton, that was a really terrible way to put that, where they thought she
had put together to maybe push her three or four points, which was the
conventional wisdom going into last night.

HAYES: Yes. And, Joan, I thought – I mean, from what I could tell, I
mean, I think that Clinton operation in Iowa did an excellent job. And to
me, the idea that the issue here is the campaign is a little, I think
misdirected. I mean, clearly, there`s a message situation happening here.
We`ll talk later in the show about whether to adjust it or not.

But what do you think – what is your take away out of this strange, almost
high that ended up happening last night?

WALSH: Well, look, I think Bernie Sanders had a great night, but she did
too. She did win.

And this is – you know, I`m still here so I can say this is still a Bernie
Sanders state. It`s a very white state. It`s very liberal state, 43
percent of Iowa Democrats told “The Washington Post” that they are
socialists. God bless them. I`m happy to hear it.

It wasn`t a must win state for him. I think he did well enough with an
almost win to get a little bit of momentum going. But it`s not the same as
if he had won. It`s all we would be talking about if she lost and he won,
when does she drop out?

(LAUGHTER)

WALSH: So, I think – we would. I mean, come on, we heard a bit of that
last night. How quickly does she have to drop out if she loses Iowa?

And it`s a tough state. She came in third in 2008. So, you know, it`s not
just little league or T ball to say you did really well. She does get the
trophy going forward. She did win.

She also won – I watched a little caucus in Waterloo which is the most
diverse city in Iowa where John Lewis (ph) visited the other night. She
took those ten delegates, Waterloo, Iowa looks more like the rest of the
country than the rest of Iowa does. She really does have a lot of
advantages going forward.

But, you know, Bernie is changing the narrative. I think he did himself a
lot of good there, for sure.

HAYES: Ben, Charlie just referenced ethanol. To me, if there was one
unambiguous winner last night, it was Ted Cruz, and one ambiguous loser was
ethanol.

DOMENECH: Absolutely.

HAYES: Because Cruz did the impossible. He said screw ethanol. He
received this backlash. Terri Branstad basically, this wave of anti-
endorsements from the Iowa political establishment, that said, I don`t care
who you vote for, don`t let it be at the scene Cruz. He comes away with a
win last night.

I think it genuinely impacted the power of the ethanol lobby last night.

DOMENECH: I think that`s the big message coming out of this. I mean,
Terri Branstad son who is an ethanol lobbyist actually went and caucused
for Donald Trump last night. It didn`t make a lick of difference. So, I
think that`s a good thing.

The other message I found interesting is one, to you point earlier, Donald
Trump isn`t completely going away. This is false frame coming in second as
being something that will mortally wound him. He is the guy who bleeds
now, but I think he has the capacity to come from that.

And the other thing frankly was I was so impressed with the amount of
support that Bernie Sanders got from younger voters. That 84 percent that
they`re talking about from that entrance poll, that`s just incredibly
impressive to me. I wonder, though, how many of those voters will go over
to Hillary Clinton afterwards as she tries to hold this coalition that
requires you to win a lot of these younger voters.

Is she going to be able to win them over, over with her message, or is this
going to be a challenge for her as she goes into a general election?

HAYES: Yes. Although, Charlie, I remember back in the days of `08, people
were extrapolating a lot about the exit polls between Hillary Clinton and
Barack Obama into the general. Barack Obama is having a hard time with
these white voters.

And the fact of the matter is, a Democratic primary electorate is different
than a general electorate, particularly when you`re looking at the
crosstabs. The bigger for question out of last night, Charlie, is how long
does this go? What I saw on both sides last night were results that keep
this race going further that they might have had things gone differently
last night?

PIERCE: Yes, first of all, if Ted Cruz is the Republican nominee, Hillary
Clinton will not have to worry about those young voters going to her in the
general election – I`d say that right now.

Second of all, this will be a long, long process. Bernie Sanders has a lot
of money in the bank. Donald Trump – I agree completely with Ben, that
this whole notion that now that he`s lost a primary, all the air will go
out of the bubble is silly, because first of all, he`s going to have the
other candidates doing all of his dirty work on Marco Rubio in New
Hampshire.

As Joan pointed, Chris Christie started today with that. He`s got a lot of
money. He answers to nobody but himself. There`s no establishment really
on the Republican side to take him out. So, I think you`re going at least
until Super Tuesday and probably beyond.

HAYES: Yes, it`s going to be a long one, I think.

Joan Walsh, Charlie Pierce, Ben Domenech, that was great – thank you very
much. >

Still ahead, for a candidate who`s campaign is based on being a winner,
what do you do with a second place finish?

Plus, Hillary Clinton breathes a sigh of relief. Does her campaign need to
correct course after such a close finish?

And later, last night saw record turn out for the Republican caucus.
Should Democrats be worried?

Those stories and more, ahead.

(COMMERCIAL BREAK)

HAYES: Liz Cheney, Dick Cheney`s daughter, just launched her new campaign
for Congress and she did squarely it on the wrong foot. You may remember
that two years ago, the daughter of the former vice president
unsuccessfully ran in a primary for U.S. Senate in Wyoming, where among
other things she battled the “carpet bagger” label since she hadn`t lived
in the state for years.

Last night, she announced she`s at it again. She`s going to run for
Wyoming`s only house seat this time. But she appeared to immediately
commit an unforced error.

As noted first by a Wyoming resident, Cheney announced her bid on Facebook
as a strong conservative voice for Wyoming. In a post, she wrote, “from
Alexandria, Virginia”.

The attack ads write themselves.

(COMEMRCIAL BREAK)

(BEGIN VIDEO CLIP)

TRUMP: I was expected to come in anywhere like 10, 11, 12, 13. I ended
coming in second. Didn`t devote tremendous time to it. Didn`t devote
tremendous money to it. In fact, I guess in terms of money per vote, I`m
at the bottom, meaning the most efficient.

I came in second. A came in a strong second. Third was quite a bit away.
I think 2,500 or something, close to 3,000 votes away. That was a big
difference between second and third.

(END VIDEO CLIP)

HAYES: So, everyone was wondering what does it look like when Donald Trump
who loves nothing more than to talk about he`s a winner, finally loses?

But that`s what it looks like, spinning his second place finish. There was
not contrary to what Trump said there, there was a very big difference
between the second place finish and Marco Rubio third place finish.

About an hour ago in Milford, New Hampshire, Trump appeared with the man
who endorsed him, Senator Scott Brown, who you may recall, knows a bit
about losing as well. He lost his bid to become senator two years ago
which was two years after he lost his re-election as senator from
Massachusetts. Now, Trump welcomed the endorsement, capping off a
fascinating 24 hours.

Last night, Trump gave a fairly gracious concession speech, congratulating
Ted Cruz, thanking the people of Iowa. He even crucially took a break from
Twitter. Once he reappeared online, he returned to form, as in blaming the
media. The media has not covered my long shot fairly, brought a record
voters, got second highest vote total in history, as in going after Ted
Cruz. Anybody who watched all of Ted Cruz`s far too long, rambling overly
flamboyant speech last night would say that`s his Howard Dean moment.

Now, does Trump just weather the Iowa loss and trounces his opponents in
New Hampshire, is this finally the Trump, after all those predictions about
the end of Trump?

Joining me now, Harry Enten, he`s senior political writer, analyst of
FiveThirtyEight.

You guys have undercounted his strength. Last night, well, he had a little
bit.

HARRY ENTEN, SENIOR ANALYST, FIVETHIRTYEIGHT: A little.

HAYES: Last night, he underperforms the polls. Does this contribute any
data that`s useful this modeling what`s going to happen in New Hampshire?

ENTEN: I think two things. Number, yes, he underperformed his polls. So,
is it going to be as we head into New Hampshire, that all these people who
say maybe I don`t want to vote for that celebrity. So, I think that`s one
factor.

I think the big thing that`s going to change is the media coverage. He`s
gotten so much media coverage so far, and now, all of a sudden, he has to
split it with Rubio and Cruz. It could contribute to him declining in the
polls as we head into New Hampshire.

HAYES: Here`s a question about whether the Trump voters show up. I think
it`s wrong to say Trump voters didn`t show up. I tweeted before like, I
could see him like getting 10 percent or 60 percent. Like I have no clue,
right?

I think it`s wrong to say the Trump voters didn`t show up. I mean, he
underperformed, but he did get the second highest vote total in Iowa
caucuses in history, right? I mean, there were tens of thousands of people
who really did show up. Like there is an actually base of support for
Donald Trump that is a real thing and not just a phantasm of the polls.

ENTEN: Sure. But, of course, some of the light polls did show that some
people were shifting away from Trump. The other thing with high turn out
is you could have high turn out where people are showing up to vote against
Donald Trump. And, in fact, that`s what happened to Ted Cruz. He got the
highest vote total ever.

So, you know, we`ll have to see what happens in New Hampshire.

HAYES: One thing I think you guys have pointed out at FiveThirtyEight and
a number of people is, you know, he was able to go a long time without
being attacked a lot whether it was negative ads or getting full scale
assault on him. We saw his favorables go down the last few weeks in Iowa
when there were ads on the air that were negative attack ads.

ENTEN: Yes, exactly. So, you got super PACs that are going after him and
for the first time, Jeb Bush is going to walk the walk instead of just
talking. And he`s going to air some ads against him. So, there`s going to
be a lot of negative ads against him and I do expect his favorable ratings
in New Hampshire which aren`t so hot to begin with may drop even further.

HAYES: But the problem is the game theory still applies, right? And the
theory problem has been that no one wants to do Marco Rubio`s dirty work
for Marco, right? No one wants to – when you`re talking about Christie,
Kasich and Rubio have all been attacking each other. Is there any reason
to think that behavior is going to change?

ENTEN: Maybe it doesn`t need to change, because look at what Marco Rubio
accomplished in Iowa. Yes, it was third place, he didn`t get first or even
second, but he did finish strongly. So, who is to say when we get this
media coverage saying, hey, Rubio is the hot stuff, that he doesn`t
coalesce that establishment lane in New Hampshire and begins to rise in
polls there, just like he did in Iowa.

HAYES: All right. Harry Enten, thank you very much.

ENTEN: Thank you.

HAYES: Coming up, I had a chance to talk with Iowa caucus-goers last
night. As I watched the whole process unfold, I couldn`t help but wonder
if this is the best idea. More on that next.

(COMMERCIAL BREAK)

HAYES: Last night, I was in Iowa to watch hundreds of thousands of Iowans
heading to their local caucus sites and make their preferences, for the
Democratic and Republican nominees for president. It`s a process,
particularly on the Democratic side that takes a level of time and
commitment, unlike many others in the electoral process. It`s good for
television but potentially not so great for democracy.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Anyone not registered to vote? Come over to this end
of the table, please?

BRIAN WILLIAMS, MSNBC ANCHOR: Chris Hayes is at one of the caucus sites
tonight.

HAYES: All these people who are coming out here on a Monday night starting
to talk to each other and wearing their gear and start to talk to friends
about who they want to support. A lot of kibitzing, a lot of joking, a lot
of talking.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Hi. I`m in a play about Hillary Clinton.

HAYES: You made a play.

UNIDENTIFIED FEMALE: No, no. I`m in it. I`m playing Monica Lewinsky.
No, it`s great.

HAYES: Oh, wow.

UNIDENTIFIED FEMALE: I`m caucusing for Bernie.

HAYES: You`re caucusing for Bernie.

You`re caucusing for Bernie.

UNIDENTIFIED MALE: Yes, I am.

UNIDENTIFIED MALE: I think Rand.

HAYES: Rand Paul.

UNIDENTIFIED MALE: Jeb Bush.

HAYES: Jeb Bush.

UNIDENTIFIED FEMALE: Hillary.

UNIDENTIFIED MALE: I like Donald Trump, because he`s not bought and paid
for.

HAYES: Who are you caucusing for tonight?

UNIDENTIFIED MALE: Bernie Sanders.

HAYES: Really? But you`re a Republican.

UNIDENTIFIED MALE: Yeah, but I`m not anymore.

HAYES: Who did you caucus for last time? Made a deep impression.

UNIDENTIFIED MALE: Yeah, no kidding. I was even precinct chairman I think
then. I don`t recall.

HAYES: Right now you see the supporters coming in and a lot of volunteers
and the precinct captains. The precinct captains are those people who are
going to stand up in the room and make their pitch for their candidate.

UNIDENTIFIED MALE: We have somebody here for Carly Fiorina. Any words for
Carly? OK.

UNIDENTIFIED MALE: Hillary Clinton fears Senator Rubio. I mean, it`s
clear. She constantly attacks him. It`s ridiculous.

UNIDENTIFIED MALE: What about Mr. Gilmore.

UIDENTIFIED FEMALE: You want someone to go to Washington the get along,
Senator Cruz is not your man.

UNIDENTIFIED MALE: Huckabee. No one for Huck.

UNIDENTIFIED MALE: How many people in here like Obama? Anybody? I think
it`s safe to say nobody.

UNIDENTIFIED MALE: By voting for Rick, we send a clear signal to ISIS that
we`re prepared for war.

UNIDENTIFIED MALE: I`m asking you from the bottom of my heart from
everybody that support in what I believe in please make the right choice,
vote for Donald Trump and let`s make America great again.

HAYES: How bit was turnout tonight?

UNIDENTIFEID MALE: Big. We are just over 200 people, which is a lot more
than we expected downtown.

UNIDENTIFIED MALE: Well, we ran out of new registration forms and I had to
run and find some more literally in the middle of this.

HAYES: I am in an auditorium, that`s the Sanders supporters right now.

So, there, that small group, people on stage are the 24 O`Malley supporters
who are now deciding where to go.

UNIDENTIFIED MALE: Martin O`Malley 24.

UNIDENTIFIED MALE: Marco Rubio.

UNIDENTIFIED MALE: Hillary Clinton, 182.

UNIDENTIFIED MALE: Marco Rubio.

UNIDENTIFIED MALE: Bernie Sanders, 233.

(APPLAUSE)

UNIDENTIFIED MALE: Rand Paul.

RACHEL MADDOW, MSNBC: One of the more startling updates from this very
close
race tonight on the Democratic side is that maybe coin flipping had
something to do with the results that we got thus far.

UNIDENTIFIED MALE: You are Rick Santorum precinct captain up there.

By voting for Rick we send a clear signal to ISIS that we`re prepared for
war.

And actually, I do – if you haven`t seen them, I have – I mean, hold on.

HAYES: Oh, there you go. This is the actual sheet, the tally sheet. And
Santorum there`s an x next to him.

UNIDENTIFIED MALE: Yeah.

HAYES: Well, you didn`t vote for him?

UNIDENIFIED MALE: As I was writing down, my pen ran out of ink and I was
just like I can`t just ask somebody for a new pen while I`m doing this.

HAYES: You`re the Santorum dude.

UNIDENTIFIED MALE: I know.

HAYES: Well…

UNIDENTIFIED MALE: Failure to launch.

HAYES: I think failure to launch is exactly what it sounds like.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

HAYES: Senator Bernie Sanders is in New Hampshire tonight after what many
political observers consider a surprising success in Iowa last night
insofar as seven months ago he was down by 24 points to Hillary Clinton yet
when the final votes were tallied by the Democratic Party early this
morning giving Clinton 49.9 percent of the vote and Sanders 49.6 percent of
the vote, a virtual tie.

In some ways it still seemed like less of an accomplishment. And that`s
partly because Sanders couldn`t quite pull out the decisive victory in the
state
where the demographics are much for favorable for him.

Now, on the Clinton side, barely escaping a loss has led to talks of a
campaign shake up.

According to The New York Times, quote, Mr. and Mrs. Clinton were
discussing bringing on additional staff members to strengthen her campaign
operation now that a pitched battle may lie ahead against Mr. Sanders.

Reporter Maggie Haberman pointed out on Twitter, the Clinton`s muscle
memory is to talk shake up, bringing in old hands et cetera. In reality,
her Iowa field organization saved her last night.

Now a source familiar with the thinking of the campaign tells NBC News,
there are no plans to shake up the staff.

I sat down with Democratic Congressman Keith Ellison who has endorsed
Bernie Sanders, and Howard Dean, former Democratic presidential candidate
and Hillary Clinton surrogate.

And I began by asking Dean whether the Clinton campaign was in good shape
for the contest to come or do they adjust their strategy after struggling
to beat
Sanders?

(BEGIN VIDEOTAPE)

DEAN: I think she`s doing fine. I think Bernie had a good night, Hillary
had a better one. And that`s what she needed to do.

She did what she had to do is to win – which is win Iowa.

Look, what her stock and trade is that she`s experienced. She`s done this
before. She`s the person who is most prepared to be president across the
entire field, not just the Democratic field, and that`s what she needs to
keep doing.

So, I wouldn`t change a lot.

HAYES: Congressman, you`ve campaigned a bit with Bernie Sanders. And I
think there was a question – I think last night a victory, an outright
victory there would have really shocked the political world. I think had
he lost by five or seven points everyone would have said, well, that was
nice, that was fun while it lasted.

Where is the Sanders campaign after last night`s result?

REP. KEITH ELLISON, (D) MINNESOTA: Bernie is in this. He`s excited. His
base is excited. His campaign is excited. And this thing is within our
grasp.

Right now turning to New Hampshire. And I think the excitement is doing
nothing but building.

HAYES: Let me ask you this, last night when you watch – he did his speech
late. It was the thing that has been so I think effective about the
Sanders campaign is that they had the same message from day one to now. It
has not wavered. And I think there`s a person out there who thinks that
it`s not completely authentic to who Bernie Sanders is and what he believes
in.

That said, at a certain point, doesn`t the message have to expand outwards
a bit if he`s going go play deep into this race?

ELLISON: Well, look, you know, the problems that are facing Americans are
pretty persistent, Chris.

I mean, look, you know, income inequality, stagnating pay, unaffordable
college tuition, I mean, the trade deals that are offshoring, exporting our
jobs. He`s hitting on the very things in an authentic, engaging way that
are affecting people every single day. Those things are not going go away.

And I think Bernie Sanders better continue to talk to those things, because
there`s a whole lot of people out there who have not heard that message all
across this country. And they need to hear somebody who is speaking to
their bread and
butter stuff in an authentic, meaningful way.

HAYES: Howard, in terms of this sort of authenticity of that message. I
mean, the Clinton campaign message has been a lot about her resume and
experience, which you mentioned before. Does it not give you pause that
that lead her to a tie, functionally a tie in Iowa. She won by four out of
whatever 1,300 votes.

And then if you look at the other – the mood of the electorate on the
other side, they couldn`t care less about resume.

I mean, the idea of going to the American people in this year, 2016, with a
resume based message for presidency, does that not worry you, given what
we`ve seen so far?

DEAN: Her only message is not just about resume. She was the first person
before anybody else got in the race to say that she would make sure that
Citizen`s United was reversed by her appointments to the Supreme Court.

25, 30 years ago she was chose the Children`s Defense Fund over a lucrative
law career in New York.

So, I mean, she`s been making these choices. She probably knows more about
health care than anybody running for office. I mean, she`s been great,
particularly in encouraging girls to go beyond the boundaries that have
been set by
society. She`s got a lot of reasons that progressive people would want to
vote for her.

So, I don`t see – I mean, I use the resume argument because that`s what
pulled me into her campaign. I wanted somebody who was incredibly
competent, particularly in foreign policy. There are a lot of reasons to
vote for Hillary Clinton besides the resume.

HAYES: Congressman, there was a moment last night, I think there`s been a
lot of overblown coverage of the vitriol online between supporters of the
different camps. And I think most of that has been fairly trivial,
honestly, having lived through and covered 2008, which if people want to
see toxic exchanges in a primary, they should go revisit that.

There was a moment, though, last night when the crowd booed Hillary Clinton
when she appeared in that headquarters in Iowa. I`m just curious your
response to that.

ELLISON: Well, my response is that we`ve been a high ground campaign. We
got to stay a high ground campaign. Hillary Clinton is not the enemy. She
happens to be a contestant in this race. She deserves respect. Howard
Dean is right, she has an excellent resume and has served this country.
And we should never forget that.

But here`s the thing, Chris, she declared herself to be a progressive.
This is awesome news. I`m not saying she`s not one, I`m saying that it`s
great that both candidates declared themselves to be progressives in this
race and see themselves and self-identify that way.

Anybody who is thinking about the progressive movement and the movement to
put American citizens first as opposed to the billionaires has got to be
glad
about that.

HAYES: Howard, what is your benchmark for New Hampshire as you look at
this campaign? What`s the goal here?

DEAN: The goal so to win. And if you don`t win, you do the best you can.
So, I don`t play the expectations game. I know what that is.

HAYES: Well, but everyone does play the expectations game. I mean, good
lord, Marco Rubio has managed to convince the world that a third place
finish is the greatest political victory anyone has pulled off in modern
era.

DEAN: Well, there is a reason for that. And it is in some ways. There
are two primaries going on in the Republican side. One is for the
accomplishment
vote and the other is for the nomination. And there`s only going to be one
accomplishment candidate and Marco Rubio just put his claim in for that.

If he comes in third in New Hampshire and Cruz and Trump win or come in
first and second on that one, I think you`re going to kiss Kristie and
Kasich good-bye and maybe Jeb Bush too.

HAYES: Oh, there will be a lot of culling of the herd. The question now
on the Democratic side, though, is with – Congressman Ellison, with this
fundraising
capacity the Sanders campaign has, I mean, the plan is to go deep here,
right?

ELLISON: Well, this is not a broke campaign. You know, this is not a
campaign of a bunch of poor, hungry, but idealistic people who are just
going to stick it out.

We have a campaign that has the resources that it needs. No super PAC
money average donation around $27. I mean, people are funding this
campaign because they believe in it.

They`re holding – they`re hanging their hopes on it. And that`s why I`m
very convinced that we will go deep into this thing. And he`s already
changed the national dialogue. And I`m really excited abou tthat.

HAYES: Congressman Keith Ellison and Howard Dean, thank you both,
gentlemen, for your time.

DEAN: Thank you.

ELLISON: Thank you, Howard.

Still to come, we have some very important business to attend to updating
the all important 2016 fantasy candidate draft. That`s next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MIKE HUCKABEE, FRM. GOVERNOR OF ARKANSAS: Elections are about choices.
The main thing I need to say to you tonight is that as we come here
tonight, it`s time to officially suspend the campaign.

MARTIN O`MALLEY, FRM. GOVERNOR OF MARYLAND: The people have made their
choice. So, tonight, I have to tell you that I am suspending this
presidential bid.

(END VIDEO CLIP)

HAYES: That`s right. The people of Iowa have made their choice. The
battle is over, now it`s time to tally the casualties.

So, let`s update our All In 2016 Fantasy Candidate Draft.

Mike Huckabee and Martin O`Malley join George Pataki, Lindsey Graham, Bobbi
Jindal, Rick Perry and Scott Walker, as well as Jim Webb, in having their
hopes and dreams of becoming president crushed.

So, which draft contestants have the latest candidates to drop out of the
race?

(BEGIN VIDEO CLIP)

HAYES: Michael Steele choosing the second to last, otherwise known as
penultimate candidate.

Martin O`Malley.

MICHAEL STEELE, FRM. RNC CHAIRMAN: O`Malley`s going to be. I think,
again, I`ve got a lot of VP potential.

JOY REID, MSNBC CORRESPONDENT: Well, I`ve got to tell you so far this game
has to be, quote the immortal Michael Jackson, devilish. So, I`m going go
with number six.

HAYES: Nice. Joy Reid makes a satanic play at work.

No. She gets the preacher instead.

REID: I think he will run. I think he will do very well in Iowa.

(END VIDEO CLIP)

HAYES: Or not.

OK, let`s take a look at the current standings. Michael Steele is in the
lead with 6,900 whopping points.

Jess McIntosh only a hundred points behind. Looks like Joy Reid, Sam
Seder, and Josh Barrow have quite a bit of catching up to do.

Coming up, something the media missed last night that tells us a lot about
the current state of the race. Don`t go anywhere.

(COMMERCIAL BREAK)

HAYES: The first votes in the 2016 presidential race are finally in the
books. And we have learned a whole lot beyond who simply won and lost in
Iowa. Indeed, last night gave us all these fascinating clues about what
the state of
the race is, including a comment Hillary Clinton made in her victory party
that really caught my ear.

(BEGIN VIDEO CLIP)

CLINTON: I know that we can finish the job of universal health care
coverage for every single man, woman and child.

(END VIDEO CLIP)

HAYES: What that claim tells us about the Democratic race, other lessons
from Iowa that most people have missed, next.

(COMMERCIAL BREAK)

HAYES: Joining me now to discuss what we learned from the Iowa caucuses,
MSNBC national correspondent Joy Reid and Katrina Vanden Heuvel, editor and
publisher of The Nation.

Great to see you again after last night.

REID: I know. I feel like just saw you like (inaudible).

HAYES: All right. So, that clip, let`s start with the sort of lesson
about Hillary Clinton`s campaign in that message.

I thought that line finishing the job of providing universal health care to
every man, woman and child is a recognition of the ways in which he the
Clinton
campaign`s message is being shaped in response to Sanders.

KATRINA VANDEN HEUVEL, THE NATION: Absolutely. It`s a different message
than a week or so before.

HAYES: Literally then a week or so before.

VENDEN HEUVEL: When she was sort of attacking universal health care.

But what she`s – I think one of the reasons it was a razor thin win for
Hillary Clinton is that she did this populist pivot and she embraced
essentially what would have been Bernie Sanders` core issues in this
campaign.

I think last night was historic. Joy will agree one reason was Hillary
Clinton, first woman to win the Iowa caucuses. But it was also – we
should take a measure of how historic it was that Bernie Sanders` bold,
populist agenda challenged the grip of big money and electrified young
people and working class. It`s an extraordinary shift in this country`s
politics.

REID: Well, I definitely feel like the Hillary Clinton campaign is like a
learning robot, right. They learned so much from 2008 and corrected a lot
of the mistakes. They definitely did the Barack Obama 2008 version of the
ground game. They`ve been in there for a year. And I think they proved
that that kind of organization matters.

I was tweeting yesterday that when I went to the Hillary Clinton campaign
it was a well-oiled machine, whereas we went to the Bernie Sanders offices,
they were like a tent revival, right. There was a lot of emotion. They
have many more volunteers, almost twice as many volunteers, but the Hillary
Clinton campaign was
very disciplined. And they are learning from the things that are working
for
Bernie Sanders.

VANDEN HEUVEL: I mean, this whole campaign has essentially. Let`s
remember, when Bernie Sanders entered this race, we were looking at
inevitability, right. We are now witnessing whatever happens, and it is
obviously a steep – still steep for Bernie Sanders. He has won because he
has placed on the agenda of this campaign issues that wouldn`t have gotten
the attention.

Inequality, taxing the very rich, climate even. And this populist agenda
is going to be driven forward. And by the way, are witnessing a Millennial
generation that we, for a long time didn`t think was into a bold and
populist agenda, it is going to transform the Democratic Party and our
politics.

HAYES: OK. Here`s the question. He won by 70 points among young folks,
right.

But here`s – so one of the lessons I think is – so, one of the lessons is
Hillary Clinton`s message is adapting in response to the Bernie Sanders
message, right.

The other is, organization matters. We saw that both in Democratic and on
Ted Cruz`s side, where that was – they built a heck of a machine over
there, right.

But, the other thing, the third lesson to me and I think people aren`t
talking about enough is, is – do Democrats have an enthusiasm issue.
Because when you talk about how incredibly enthusiastic Bernie Sanders
supporters are, and there`s a lot of very enthusiastic Clinton supporters,
and they both had very good organizations. I mean, look at this data,
right, 2008, 239,000 Democrats come out. Last night it was 171,000.

VANDEN HEUVEL: That`s right.

HAYES: The Republicans moving in the opposite direction: 119,000 in 2008,
186,000 last night. That – if you`re a Democrat and you look at that…

REID: That`s a problem.

And by the way, the other problem, I think, and one of the reason it was a
narrow loss for Bernie Sanders, is that within that 171,000 – remember,
his threshhold was about 170,000, he had a lower percentage of voters 18 to
30 than Barack Obama had in 2008 and asmaller percentage of first time
voters, it went from over 50 percent to a little over 45 percent.

So, we`re talking about Democrats going in the wrong direction in terms of
motivating and turnout.

HAYES: You don`t think – that doesn`t worry you?

VANDEN HEUVEL: No, it doesn`t worry me. Because I think we`re looking.
Demography isn`t destiny, but we`re looking at the rising American
majority, which is going to play a critical role in this election.
Democrats have a better map.

But more important, they have a better message. And I also think there`s
been media malpractice and Democratic Party malpractice. There should be
been more debates. I really do think the Republicans have beefited
enormously. You buried the Democrat debates on football weekends.

HAYES: Let me stop you there and make a plug. We have a debate on
schedule for Thursday night, which as far as I can tell is going to happen
on Thursday night.

VANDEN HEUVEL: It was malpractice because for too long the Republican
message was what people were hearing.

And put aside that the media lavished all the attention on Donald Trump and
didn`t pay attention to Bernie Sanders rallies, but it was a mistake and
Hillary Clinton is a good debater.

REID: And thing is that I think what also what happened outside of just
the lavishing of attention on Donald Trump, there`s been a robust debate
within the republican sphere and within the conservative movement about
which of these polarities matters the most, whether it is movement
conservatism or whether iti s evangelicals. They`ve have that robust
debate.

Democrats have been locked into this inevitability argument for almost a
year last year. They didn`t get to really get into…

(CROSSTALK)

VANDEN HEUVEL: And the issues, by the way, which are winning issues in
this country: affordable college, decent pensions, universal health care,
preserving and expanding Social Security, these are messages and ideas that
were not heard for too long because you had a shut down of real debate.

HAYES: Here`s an interesting entrance polling last night. This is of
Democrats. Should next president continue Obama`s policies? Continue
policies 55 percent, more liberal, 33 percent, less liberal, 7 percent.

Now, I`m not quite sure if I find that surprising.

REID: Not in Iowa. It`s not surprising in Iowa. I mean, Iowa is a very
liberal Democratic cohort. So, Iowa is this interesting state where the
Republicans are really Republicany and really conservative and the
Democrats are really liberal, much more liberal than they are in the rest
of the country.

HAYES: Oh, so you think 33 is high?

REID: I think 33 – well, it`s high for Democrats, because nationally, I
think that Democrats are not as liberal as Iowa and Vermont and New
Hampshire.

VANDEN HEUVEL: I think it`s a mistake for Secretary of State Clinton to
run as a candidate of too much continuity. What she did last night was
something different. She pivoted away from that continuity into saying I`m
going to be the
future.

You know, part of the big problem here – let me just step back – is I
think a lot of people in this country are still angry on the Republican
and Democratic side, rightly. Banks are still big. No one has gone to
jail for financial fraud. And the establishment in this country and their
choices have wrecked serial devastations on this country.

HAYES: Right, but then how as a Democratic candidate you run against that?

After eight years of an Democratic president, you say, man, that serial
devastation.

REID: But – so, the one thing I have to say, Katrina, is that there is a
portion of Democratic left that is angry. But it is mainly among white
liberals, quite frankly, the same liberals that have been angry at Barack
Obama since 2009. They form the core of Bernie Sanders support. There are
some who are people of color. There are some who are young.

I spoke with very passionate African-American supporters of Bernie Sanders
whose animating core is disappointment with Barack Obama, but the vast
majority of the base of the Democratic Party is pro-Obama. They want to
continue Obama`s policies.

HAYES: This is a question that is going to – that will be played out over
time.

VANDEN HEUVEL: Bernie Sanders needs to introduce himself. And I think he
is going to find a hearing in states which many…

HAYES: We`re going to see if those South Carolina numbers if they move or
not.

Joy Reid, Katrina Vanden Heuvel, thank you.

That is All In for this evening.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY
BE UPDATED.
END

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