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Mueller zeroes in on Hope Hick's role in cover-up. TRANSCRIPT: 2/1/2018, All In with Chris Hayes

Guests: Mark Mazzetti, Elizabeth Holtzman, Joaquin Castro

Show: ALL IN with CHRIS HAYES Date: February 1, 2018 Guest: Mark Mazzetti, Elizabeth Holtzman, Joaquin Castro

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: -- that Don had in that meeting.

CHRIS HAYES, MSNBC HOST: New reporting that the President himself directed the cover-up of his son`s Trump Tower meeting with Russians and why Hope Hicks is at the center of it all.

TRUMP: Hope, say a couple of words.

HAYES: Plus, as Republicans join the FBI to warn against releasing it, rising White House fears that the Nunes memo is a dud. Will the FBI Director quit if the President releases the document? And he`s the man his hometown paper calls Trump`s stooge.

REP. DEVIN NUNES (R-CA), CHAIRMAN, INTELLIGENCE COMMITTEE: I think it should bother the President.

HAYES: Just what is the deal with Devin Nunes? When ALL IN starts right now.

(END VIDEO CLIP)

HAYES: Good evening from New York, I`m Chris Hayes. The e-mails "will never get out." Those are the words that Hope Hicks, the White House Communications Director allegedly said to the President of the United States about perhaps the single most incriminating piece of evidence in the entire Russia collusion story. That evidence which you may recall, that e- mail exchange setting up that dubious Trump Tower meeting jack in June 2016 in which Donald Trump Jr. was offered "official documents and information that would incriminate Hillary Clinton part of Russia and its government`s support for Mr. Trump." We`re learning this now because, well, people are talking. They`re talking to the press, they`re talking to reporters and they are talking to the Special Counsel. A Special Counsel who is steadily working his way through the President`s inner circle and now negotiating the terms of an interview with the President himself.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Are you going to talk to Mueller?

TRUMP: I`m looking forward to it, actually.

UNIDENTIFIED FEMALE: Do you want -- do you have a date set.

TRUMP: Here`s the story, just so you understand. There`s been no collusion whatsoever. There`s no obstruction whatsoever. And I`m looking forward to it. You know, again, I have to say, subject to my lawyers and all of that, but I would love to do it.

(END VIDEO CLIP)

HAYES: And as Robert Mueller closes in on the Oval Office, Republicans in Congress are staging a desperate spectacle to distract from the Russia probe, discredit the investigators and give the president a pretext to fire the Deputy Attorney General supervising is the entire probe. We`re going to get to all of that coming up. But first, let`s address the actual events that appear to be at the core of Mueller`s investigation, the core of the story, the core what we have been following for more than a year now. This latest revelation reported by The New York Times exposes a White House staff scrambling to come up with an explanation for the Trump Tower meeting before it was disclosed to the public. And for the first time in all the different clues turned over in the Russia story, and there have been many, in this one, the President himself is at the center of it. He is the one in the room, he is the one making the decisions.

This goes back to July 2017 when the Times first informed the White House it was about to break the story of that Trump Tower meeting. The President was flying home on Air Force One headed back to Washington from a Summit of World Leaders in Germany where he just so happened to have had his first face-to-face meeting with Russian President Vladimir Putin. According to the Times, the President huddled in the plane`s front cabin with Hope Hicks who was texting furiously with Don Junior trying to get their stories straight.

And it was reportedly the President himself who supervised the writing of his son`s statement to the Times, a statement that concealed the real reason Don Junior took that meeting with the Russian lawyer among others. Mr. Trump was insistent about including language the meeting was about Russian adoptions according to two people with knowledge of the discussion. The statement they released made no mention of the offer made to Don Junior of dirt on Hillary -- dirt on Clinton or of his enthusiastic response, "if it`s what you say it is, I`d love it." Administration officials downplayed the whole affair.

(BEGIN VIDEO CLIP)

REINCE PRIEBUS, FORMER CHIEF OF STAFF, WHITE HOUSE: It was a very short meeting. It was a meeting apparently about Russian adoption and after about 20 minutes, the meeting ended. I don`t know how much about it other than it seems to be on the end of the Trump individual, a big nothing burger.

(END VIDEO CLIP)

HAYES: A big nothing burger, short meeting, a meeting about Russian adoption so says Reince Priebus on camera to the entire nation. That`s what he said, not true. Back in Washington, according to The New York Times, the President held a conference to calm the story with Hicks when she allegedly said that the Don Junior e-mails, those very, very incriminating e-mails, and I quote here, "will never get out," because only a few people have access to them. It will never get out, nobody has to know. So what`s that mean? Hicks` attorney strongly denied that account calling it completely false. But there was another person on the conference call, someone who is reportedly willing to recount the story you just heard to Robert Mueller. That would be Mark Corallo. He`s a Spokesman for the President`s legal team or at least he was. And he told colleagues he was alarmed by Hicks` comment concluding she was either being naive or, quoting again, "was suggesting that the e-mails could be withheld from investigators." That, of course, would amount to obstruction of justice. You can`t do that. It`s pretty black and white.

Now, Don Junior went on to release the e-mails himself after learning the Times is about to publish them and not long after that Corallo resigned from the President`s legal team. Now Corallo has reportedly agreed to an interview with Mueller`s investigators. And he`s not the only one they want to question about the sequence of events. According to the Times, Mueller`s team recently notified the President`s lawyer the Air Force One statement is one of about a dozen subjects that prosecutors want to discusses in a face to face interview with the President of the United States. Mark Mazzetti is Washington Investigations Editor for The New York Times and a heck of a reporter. He`s one of the reporters who broke that story. OK, let`s start with where we just ended up on Mueller being interested in this. You guys had a great line in the piece saying it`s not illegal. It`s illegal to lie to the FBI and it`s illegal to lie to the investigators but not to the press. You could -- if you`re a President and want to lie to the press, there`s no law against that. So why would Mueller be interested in this?

MARK MAZZETTI, WASHINGTON INVESTIGATIONS EDITOR, THE NEW YORK TIMES: Right, lying to the press is sort of common practice in Washington, unfortunately. The -- but the -- it`s been interesting how much Mueller has focused a lot of his questioning of various witnesses on this statement. And you raise a good point. What would be illegal about it? It may not be illegal to put out a false statement to The New York Times but it may sort of get to the intent, it may get to the question of what the President himself was trying to obfuscate and what his team was trying to sort of create a false impression about when they were first encountered with information about this meeting.

Now, recall, the Times presented the White House with information that we`re going to go with the story about this meeting that it happened a year earlier. And within hours they produced this statement that was certainly misleading saying as you said about -- it was about Russian adoptions. It`s unclear what Mueller is getting at but the fact that as you said, he included this as one of about 12 different subjects he wanted to talk to the President about clearly shows that he wants to get a clearer picture about the President`s role in this whole episode.

HAYES: There`s also something about the story and it`s a really good tick- tock. There`s a consciousness of the fact they`re covering up something at least according to the account that you have when Hope Hicks says they`ll never get out. Because my understanding is the Times is about to write the story. It`s not -- it doesn`t include the e-mails, it`s just about the fact that this meeting happened. And yet the people in this meeting and this including the President of the United States know that there are these e-mails with a very different story to tell about that meeting. Is that right?

MAZZETTI: That`s right. I mean, for months we`ve -- inside our group have sort of described this whole thing as like the last scene of Reservoir Dogs when everyone is pointing guns at each other and everyone ends up dying. It`s a circular firing squad where people were people were sort of trying to protect their own interests, shifting blame and obfuscating. There was -- it was unclear exactly how this statement got produced, but what did get produced was not the real story, was the story -- real story was they had been presented with an offer of damaging information about Hillary Clinton that was supposedly part of the Russian government`s efforts to help Donald Trump. What came out after that frantic meeting on Air Force One was this was the meeting about adoptions. So what we saw in that 48-hour period was real concern that this -- the Mueller investigation might get into the heart of the Trump family, the Trump inner circle.

HAYES: I want to read that statement just very quickly that came out. It was a short introductory meeting. I asked Jared and Paul to stop by. We primarily discussed a program about the adoption of Russian children that was active and popular with American families years ago and was since ended by the Russian government. It was not a campaign issue at the time. There was no follow-up. Now, interestingly, you guys have reporting saying four people familiar with the discussions, it was Trump Junior who`d insisted that the word primarily be included in the statement which is a hedge which makes it a little less untruthful than if it was just short introductory meeting about that. Is that -- is that the understanding that Junior wanted to put in the hedge word?

MAZZETTI: That he wanted to in the hedge word, primarily. And you know, if you -- if you look at the statement, it is all focused on primarily what happened, what was discussed at the meeting and not the reason it was set up. If they had said, why it was setup, it would have been well, if they were to be truthful, it was well, we were promised really good information about Hillary Clinton and they didn`t deliver on what they promised. So it was -- it was clearly carefully written in the end and it was --there were a lot of different interests involved that sort of went into describing to sort of producing that statement.

HAYES: All right, Mark Mazzetti of the New York Times, thanks for joining me.

MAZZETTI: Thank you.

HAYES: Elizabeth Holtzman is a former Democratic Congressman who voted to impeach Richard Nixon as a member of the House Judiciary Committee and Paul Butler former Federal Prosecutor, MSNBC Legal Analyst. Let me start with you. You sat down at this table, you said it`s going to get worse isn`t it. What did you mean by that?

ELIZABETH HOLTZMAN, FORMER DEMOCRATIC CONGRESSMAN: Well, I think we`re going to be facing a constitutional crisis. I think the President seems to be intent on working with the House Republicans on the Intelligence Committee to sabotage the FBI investigation which is already in itself a horrific thing. And also setting himself up for firing Rosenstein who obviously is the Acting Attorney General, the Deputy Attorney General. And if those things happen, where are we as a country? I mean, I was there during Watergate. It was -- we were dealing with a Republican President but the Republicans in the House of Representatives didn`t try to sabotage what we were doing. People worked together to try to find the truth and then deal with it. I mean, some of them said, well, we never found the truth and objected. But everybody worked within the rule of law. Here we have a very different scenario.

HAYES: Paul, in the context of this reveal about this exchanging about this meeting and Mueller`s interest in it, what is the significance of the president`s personal participation to your mind?

PAUL BUTLER, MSNBC LEGAL ANALYST: Well, for one thing Chris, you know if in a meeting with Donald Trump Jr. or the President and Hope Hicks when they`re trying to gin up a false narrative about what happened at the meeting with the Russians, if Donald Trump Jr. is the wise lawyerly one, we can only imagine how much trouble President Trump is in. And so, I think that Special Counsel Mueller is looking at conspiracy to obstruct justice. If Hope Hicks then President Trump were in some kind of agreement or understanding that these e-mails never would come forward. And also if Miss Hicks has not been forth coming in her meetings with Mueller or the Congress to date about this incident, if in fact, she lied, then she`s going down for perjury or false statements.

And finally, this goes to the President`s own intent in obstruction of justice. You know, the issue has been -- his defense has been that he`s clueless. So when he has all these conversations with law enforcement agents when he asks for loyalty or asks for inappropriate interventions, he`s like I just didn`t know you couldn`t do that. Well, the more we know, the more evidence we have that he`s not clueless but corrupt, that this e- mail or this press release that he and Miss Hicks put together was a lie, they knew it was a lie. And again, that`s just further corroboration of his intent to obstruct justice.

HOLTZMAN: This reminds me again going back to Watergate and Richard Nixon. Donald Trump is working on the words of a press release that`s a cover-up. Richard Nixon was involved in the details of the cover-up of Watergate including what was said to the press, including what was to be said to the FBI and the CIA and all that stuff. That`s the same level of detail of involvement that we`re seeing here.

The other thing that`s very interesting to me is that in this conversation with Mark Corallo, Donald Trump seems to know what`s already in the e-mails because he doesn`t say what e-mails are you talking about? What do they say? He knows what`s in those e-mails. He and understands what`s in those e-mails. So the question arises, did he know about this meeting beforehand? What happened after the meeting? We don`t -- you know, Donald Trump Jr. said nothing happened after the meeting. But we do know within two weeks the Russians started to release information that they had stolen from the -- intercepted from the DNC. So there`s a lot that Donald Trump knows. We can see from his hands-on involvement in minutia.

HAYES: Yes, that`s what -- that`s the significance here.

HOLTZMAN: And that`s Nixon all over again.

HAYES: Paul, there`s a story tonight that I want to get your reaction to which is really interesting. Rick Gates is one of the people that has been indicted by Robert Mueller along with Paul Manafort. He has not pled. He has not pled guilty. He`s pled not guilty. He and Manafort are facing and awaiting trial. And we get this news tonight that Rick Gates has quietly added a prominent white-collar attorney Tom Green to his defense team signaling Gates approach to his not guilty plea could be changed in behind the scenes, and then today a filing by his former attorneys to get off the case. They don`t explain why. That`s sealed but it appears that he`s changing his representation perhaps moving in the direction of a plea. What`s the significance there?

BUTLER: Chris, Special Counsel Mueller is going after Trump associates the way an old-school prosecutor would go after a mafia crime family. So the word for today is superseding indictment. That`s what a prosecutor threatens someone with if he`s already charged him with a crime and the person isn`t cooperating in the way the prosecutor would like. You say I`m going to charge you with a whole bunch of other new crimes which reportedly is what Mueller said to Richard Gates. And so he gets a new attorney which to me suggests he`s cooperating or strongly considering cooperating. And he could bring down Manafort who is indicted with, who was his business associate and again, Manafort, Hicks, these are all people who are on the way to the big target here which is the President of the United States.

HAYES: Final question for you because there was a fight about what documents particularly in the case of tapes the White House had, and they lied about it, and they obfuscated, and they fought in the court to not give them up. Do you have concerns about document retention in the case of this White House given what Hope Hicks is alleged to have said?

HOLTZMAN: Of course. You always have a question about that. But the point is, a lot of people were on those e-mail chains. So it might be a lot more difficult than it was, for example, in Watergate pre-internet, pre-e-mail to destroy everything.

HAYES: Really interesting. Elizabeth Holtzman and Paul Butler, it so great to have both of you really. Coming up, the increasing drumbeat to #ReleaseTheMemo and the increasing likelihood it may be a dud. One of the House Intel Democrats, one of the people on that committee who sits next to Devin Nunes joins me next.

(COMMERCIAL BREAK)

HAYES: -- looks almost certain the White House is going to overrule its own justice department, ignore bipartisan warnings and clear the way to #ReleaseTheMemo. Senior administration official telling NBC News today, "right now I think it will be that we tell the Congress probably tomorrow the President is OK with it. I doubt there will be any redactions. Then it is in Congress` hands after that." Trump has been reportedly telling associates the memo could help discredit the Russia investigation by exposing what Republicans claim as anti-Trump bias in the FBI, could potentially give him a pretext to fire the man overseeing the Mueller investigation Deputy Attorney General Rod Rosenstein and allow the President to replace Rosenstein with a Trump loyalist.

(BEGIN VIDEO CLIP)

REP. LEE ZELDIN (R), NEW YORK: It`s going to be showing misconduct on the part of top people at the DOJ and FBI. You`re going to see a need for a change to certain practices up there. There`s going to be a need for a change of certain personnel towards the top.

(END VIDEO CLIP)

HAYES: The memo emerged from the office of Trump loyalist and House Intel Chair Devin Nunes who amazingly has our understanding is not read the classified intelligence upon it which it was based. The top Democrat on that Committee Adam Schiff who has read the intel says the memo leaves out crucial information and is purposely misleading. The FBI itself, the FBI itself, the FBI, the Federal Bureau of Investigation which is in the executive branch which is run by Donald Trump, it echoed the sentiment of Adam Schiff. It said, "we have grave concerns about material omissions of fact that fundamentally impact the memo`s accuracy."

On Monday sources tell NBC News, Rosenstein and the FBI`s Director Christopher Wray went over to the White House specifically to appeal to the Trump Chief of Staff John Kelly not to make the memo public. And today, one of the top Republicans in the Senate John Thune urged the White House to listen to the FBI`s concerns. But that seems pretty unlikely in part because Trump T.V. has relentlessly hyped the memo as world-changing stuff.

(BEGIN VIDEO CLIP)

SEAN HANNITY, HOST, FOX NEWS CHANNEL: This memo is going to be released. I`m told it will shock the conscience. This to me is the biggest political scandal in American history.

(END VIDEO CLIP)

HAYES: Wow. That was a long history in America. Lots -- there`s been lots of scandals, or not. Axios reported today there`s a rising fear in the White House the memo will be a dud, not the slam-dunk document it`s been hyped up to be. Joining me now, a Member of that Committee, House Intelligence Committee, Congressman Joaquin Castro of Texas who is here in New York. It`s great to have you in person.

REP. JOAQUIN CASTRO (D-TX), HOUSE INTELLIGENCE COMMITTEE: Yes, it`s great to be here with you, Chris.

HAYES: A really important point here, the memo is a summary, we think, of a FISA warrant or documents around a FISA warrant.

CASTRO: That I can`t comment on.

HAYES: OK. This is -- I just want to be clear. This is our understanding. I -- Adam Schiff says -- I just want to make sure I get this right that Nunes hasn`t read the underlying classified material?

CASTRO: That`s right. It`s amazing this was even released to the White House and that it could be made public when it looks like Chairman Nunes didn`t read it and really only two people including Adam Schiff on the Committee have read it. I have not read it. So you know, I said in that hearing that we have that I would prefer that neither memo be released, the Republican or the Democratic memo because nobody is going to be able to see the source material and make an independence judgment for themselves.

HAYES: I just don`t even understand. This is a fact that Nunes didn`t read the source material?

CASTRO: Yes.

HAYES: How does -- I mean, it just seems -- it seems like a book report and a book you haven`t read. It seems -- I mean, how --

CASTRO: That`s exactly what it is.

HAYES: But then how could you even write a thing?

CASTRO: Yes, it`s the memo itself is basically a political document. It`s a partisan document. And for whatever reason, Devin Nunes has decided to make his career a sacrifice fly for Donald Trump. That`s exactly what he`s doing. And for the White House and you know, I think when the memo comes out, I think you will have folks on Fox News and Breitbart and others who will make the kind of deal about it that Donald Trump would like to see. That`s why we wanted to make sure that both memos were going to be released at the same time if either one was going to be released.

HAYES: And yet the Republicans voted not to release the Democrats` memo.

CASTRO: Yes, they voted not to release it. And you know, we`re not even confident if the committee sends it to the President that the President would decide to release it.

HAYES: Of course because he could just block because he`s the one that has classification authority. So even if the committee Okayed did, the President could be like, no, no, I want this out there but not the Democratic one.

CASTRO: The President is getting to a point where he`s really beyond shame. So ordinarily --

HAYES: Getting to a point?

CASTRO: He`s -- I guess he`s at that point, right, where he`s beyond shame in a lot of ways, so I don`t know that he would release that memo.

HAYES: I want to ask you about a tweet from Don Junior, OK, concerns Andy McCabe. Andy McCabe is said to have resigned. The White House said we didn`t fire him, we didn`t push him out. He resigned, he was going to get retirement. He had these retirement days, and yet here`s what Don Junior says in regards to the news memo today. It was good enough to fire McCabe. No one argues it`s factually inaccurate but nowadays later they want to protect the names of those involved in the scandal that was big enough to fire a senior official a month before retirement. They don`t deserve a pass on that. Did the White House fire Andrew McCabe?

CASTRO: You know, it`s still unclear to me exactly how that all went down. But we do know that they put a lot of pressure on Andrew McCabe during this investigation and started to vilify him in the same way that they vilified Director Comey and others who were part of the intelligence community.

HAYES: Paul Ryan had something to say about this and his deep concern with the civil liberties. I want you to take a listen.

(BEGIN VIDEO CLIP)

REP. PAUL RYAN (R-WI), SPEAKER OF THE HOUSE: American civil liberties were abused, then that needs to come to light so that that doesn`t happen again. What this is not is an indictment on our institutions of our justice system. This memo is not an indictment of the FBI, of the Department of Justice, it does not impugn the Mueller investigation or the Deputy Attorney General.

(END VIDEO CLIP)

HAYES: Do you believe that?

CASTRO: No, not at all. And I think that Paul Ryan`s statement there has no credibility when you think about all of the attacks that the President has launched against the Intelligence Community including the FBI since before he was even President. It`s been a steady stream and so for Paul Ryan to say hey this had nothing to do with attacking the institutions I think is ludicrous.

HAYES: There is concern in a general sense and has been for a long time about FISA courts and about the warrants they issue and about the fact Americans might be caught up in that surveillance particularly in the digital age. Do you think this is a good faith effort to grapple with that?

CASTRO: I think it`s legitimate for the Intelligence Committee and also for the larger congress and the American people to have those discussions, those debates and those votes on legislation.

HAYES: We just did three weeks ago.

CASTRO: That`s right. But with -- if this had been a legitimate effort, a good faith effort, then they -- first of all, they wouldn`t have sprung it on us without giving us any notice as Democrats on the Committee. They would have allowed the FBI to review that memo with enough time to make a decision about it.

HAYES: Which they also voted against, right?

CASTRO: That`s right.

HAYES: Did they work with the White House? Did Nunes work with the White House?

CASTRO: I can`t tell you that for sure. You know, Congressman Quigley if you read that transcript really pushed hard to find out an answer to that question. It was never answered. But you know, given the track record of Devin`s midnight run a few months ago, several months ago now and the fact that I think there has been close connections between folks on the Committee and the White House, interactions basically since this investigation has been going on, it would not surprise me if they did worked with him.

HAYES: I should say Mike Quigley wrote a letter following up on those questions were telling in the transcript requesting formal written responses to whether the White House was involved in that memo. Congressman Joaquin Castro, you should come to New York more often. It`s really nice to have you here.

CASTRO: Thank you. Thanks for having me.

HAYES: All right, coming up, the FBI Director and Deputy Attorney General both in danger of losing their jobs. The precarious position of Trump`s own people if you could call them that, next.

(COMMERCIAL BREAK)

HAYES: All right, he`s barely had the job for six months but now, this very evening, there are doubts about how much longer FBI Director Christopher Wray will last in his new job. Wray became Trump`s second FBI Director of course after the President fired James Comey back in May. And last year, Comey told Congress the President tried to extract fealty from him testifying "the President said I need loyalty, I expect loyalty." Now, Wray who Trump personally selected to run the FBI is fighting the President over release of that surveillance memo. Wray along with Deputy Attorney General Rod Rosenstein visited the White House on Monday in what the Washington Post called a last-ditch plea to keep the memo under wraps. And yesterday the bureau took the extraordinary step of releasing a statement citing "grave concerns about the memo`s accuracy."

New reporting tonight underscores the precariousness of Wray`s position. The Daily Beast reports that former agents say the Director must be ready to resign over the memo. NBC`S Pete Williams reports that as of now, Wray has no intention of quitting if indeed the memo is released. President Trump has as you may have noticed made a point to target for pressure or insults or bullying everyone with any authority in this investigation whether that`s bullying FBI number two Andrew McCabe until he steps down or maybe was fired according to Trump`s son today publicly insulting and belittling his Attorney General Jeff Sessions who the President was mad had recused himself from the Russia probe or trying and failing to fire Special Counsel Robert Mueller. So what does Christopher Wray, head of the FBI right now, a Trump appointee standing between the President and this memo, what does he do if the President ignores his warning? That`s next.

(COMMERCIAL BREAK)

HAYES: There are not one but two high level Justice Department officials who obviously could be imperiled in the controversy over the Republican surveillance memo -- Christopher Wray, whose FBI has now taken a very public stance against releasing the memo, in opposition to the president, and Deputy Attorney General Rod Rosenstein who oversees the Mueller investigation into Russian election interference and the Trump campaign and who has repeatedly drawn the president`s ire as a result.

Julian Sanchez, of the Cato Institute, argued today in "The Washington Post" the memo is a stunt but that law enforcement surveillance needs more scrutiny; and Spencer Ackerman is a national security reporter for The Daily Beast who the wrote today that ex-FBI agents say Wray must be prepared to resign over the surveillance memo.

And let me start with you, Spencer. What is going on at the FBI now? What`s the mood?

SPENCER ACKERMAN, THE DAILY BEAST: The mood is extremely tense and fearful. It`s extremely uncertain. Everyone`s waiting to find out with the expectation that the memo is going to be released, perhaps with minimal redactions, what that will then mean for them going forward.

Not only is there extreme uncertainty around Christopher Wray`s future, there`s extreme uncertainty about what happened even if he stays, what the relationship is between Wray and Trump going forward. If he stays, does that mean that he is essentially giving in to Trump and that will be a sign for the future? If he goes, who comes after him and what`s the relationship going to be at the FBI with the White House going forward.

Everything is uncertain. It feels extremely tense. I`ve talked to agents, veterans, retirees who obviously have been pretty unflappable in a lot of circumstances and just sort of don`t know what`s coming next.

HAYES: Julian, you have covered surveillance and the politics of surveillance for years. And I don`t think there`s ever been quite a moment like this, partly because so many of the issues you covered are here, but seem to be deployed in ways that are sort of obviously in bad faith.

JULIAN SANCHEZ, CATO INSTITUTE: Yeah. I mean, this is sort of a funhouse mirror situation. If you had told me a year ago that we would be having a major debate about the political abuse of surveillance powers, I would be essentially taking the side of the FBI, I would have probably not believed you.

I wish the folks who obviously are touting this memo were outside this very specific context as concerned about the potential for misuse of these authorities as they purport to be. One of the reasons it`s hard to take it that seriously is that a few weeks ago, many of the same folks who obviously are now saying there`s an outrageous scandal because a cabal of people have abused wiretaps in order to attack their political adversaries also voted against amendments that would have essentially added a warrant requirement for searching for American data in a database of warrantlessly collected intelligence intercepts.

It`s very hard for me to understand how someone could sincerely believe that within the FBI it`s possible to essentially fake up a justification to spy on an adviser to a presidential campaign and at the same time turn around and say, well, we don`t have to worry about additional civil liberties safeguards for this warrantless authority, because they`ve assured us there have never been abuses. And we should simply take their word for it. You can`t -- you can`t convince me that those are not two thoughts that sincerely coexist in the same brain.

ACKERMAN: To pick up on the thread that Julian put out there, just a couple weeks ago, we saw Paul Ryan, Devin Nunes, the House Republican caucus, many of the Democrats in the House, as well, shoulder to shoulder with Chris Wray`s FBI, with the Justice Department, to include Rod Rosenstein, everyone`s institutional prerogatives, were centered and squarely together around a --

HAYES: This power, this specific power.

ACKERMAN: And a power that as Julian points out implicates the privacy and civil liberties of millions of Americans. Now all of a sudden on the other hand, we hear massive institutional abuses committed by the FBI and the Justice Department that this memo is supposedly geared in order to expose and mitigate.

The thing is that the only civil liberties they seem to be actually concerned about are those of Donald Trump and his coterie.

HAYES: Julian, you have you written a lot about your fear, again from a perspective of someone who I think has been skeptical of too much government power and too much surveillance, but your fear of essentially -- people being put in the FBI who are fundamentally loyalist to the president as opposed to civil servants and professionals. Is that -- do you fear that`s what we see happening?

SANCHEZ: I do. The Wall Street Journal had an editorial a few weeks ago essentially tut tutting everyone who had worried about Trump`s authoritarian impulses and what the apparatus of government in his hands might look like and saying, no, our institutions have quite healthy and have essentially checked those authoritarian impulses.

But it was very clear through a consistent series of reports over the past year, that Trump really kind of came into office not understanding how things work, in some sense. That he appointed a lot of folks at senior posts at DOJ and the FBI upon arrival sort of willing to take the Federalist Society`s word for who is a smart lawyer, and thinking that it was effectively like being a CEO of a corporation where people are just sort of supposed to follow orders, and being shocked and frustrated that in effect, he can`t just call up folks at the Justice Department and say, stop investigating my friends, start investigating my enemies.

I mean, there`s a shocking level of candor repeatedly, not just in the reports based on private conversations, but things he`s said live in interviews on the radio that he`s very frustrated that he can`t take charge the way he wants to and make the FBI and the DOJ investigate Hillary Clinton instead. That`s by his own statement.

His vision of how these agencies should work. That`s not how fortunately they work. But you know, if you eventually start replacing all the people who are willing to say no, sir, Mr. President, that`s not appropriate, that`s not legal, that can become how they work.

HAYES: To that end, do you think Wray stays?

ACKERMAN: I have no idea. And I`m not going to bet on it, and I`m going to up probably all night trying to figure that out. One quick thing about what Julian is saying, about institutional resilience against authoritarian impulses this is the moment where it`s tested, right now over this memo and over the prerogatives here.

I had a retired FBI special agent over the phone with me compare Trump to Erdogan in Turkey.

HAYES: Julian Sanchez and Spencer Ackeman, thank you both for joining me.

Coming up, even in his hometown newspaper is now calling him Trump`s stooge. Just what is the deal with Devin Nunes? But first, tonight`s highest Thing One -- tonight`s highest Thing One, Thing Two in history next.

(COMMERCIAL BREAK)

HAYES: Thing One tonight, we think we pretty much settled the question about whether Donald Trump ad-libbed a lie during his first State of the Union Address. If you missed it, check out the video on Facebook.

But here`s what Trump made up on the spot while addressing the nation.

(BEGIN VIDEO CLIP)

TRUMP: Here tonight is one leader in the effort to defend our country, Homeland Security Investigation Special Agent Celestino Martinez. He goes by DJ and CJ. He said call me either one. So we`ll call you CJ.

(END VIDEO CLIP)

HAYES: He goes by DJ and CJ, or the president was just lying, which isn`t that unusual because this president lies all the time, including today his new bald-faced embarrassing lie about his State of the Union. That`s Thing Two in 60 seconds.

(COMMERCIAL BREAK)

HAYES: Remember the very first day of this presidency when President Trump instructed his press secretary to lie to the American people?

(BEGIN VIDEO CLIP)

SEAN SPICER, FORMER WHITE HOUSE PRESS SECRETARY: This was the largest audience to ever witness an inauguration period, both in person and around the globe.

(END VIDEO CLIP)

HAYES: A year later, Trump, arguably the most powerful man in the world, is still obsessed with audience size tweeting today, "thank you for all the nice compliments and reviews of the State of the Union Speech, 45.6 million people watched, the highest number in history."

That is false, of course. It is absolutely not the highest number of viewers in history, if you compare viewership for the first state of the union address delivered by the last four presidents, Bush had the most viewers at 51 million, then Obama 48 million, then Clinton with 45.8 million, and then Trump ranking and Trump with 45.6 million. That`s right, all of these presidents had more State of the Union viewers than Trump, although there was one Trump super fan who really, really seemed to enjoy the speech.

(BEGIN VIDEO CLIP)

TRUMP: To reduce the price of prescription drugs.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

HAYES: As attention turns towards the midterm elections, one of the places that has Democrats salivating is Pennsylvania, especially after a politically earth-shattering decision from the Pennsylvania Supreme Court. The court ruled that the state`s highly gerrymandered congressional districts clearly and plainly and palpably violate the Pennsylvania constitution.

Now, keep in mind, this is a state which went narrowly for Trump in 2016, but more often goes Democratic statewide. So, it would be fair -- let`s say it`s 50/50 state, a swing state. And yet, here`s the thing, 13 of the state`s 18 congressional districts went to Republicans in 2016, that`s 13 Republican, five Democratic, a Republican advantage that is completely out of whack in a swing state.

So, the Pennsylvania Supreme Court ordered the legislature to draw a nonpartisan map, but anticipating that the Republican controlled legislature, the Democratic governor might fail to agree, the court said essentially if you don`t do it in three weeks, we will do it ourselves.

Pennsylvania party leaders began closed door talks to redraw the districts, but the state`s Republican leaders appealed the decision of the U.S. supreme court, claiming the state supreme court order intrudes on their legislative turf. The U.S. Supreme Court has not yet decided whether to take the case. And then on January 26, the Pennsylvania Supreme Court issued an additional order, requesting data from the legislature, things like, quote, current boundaries of all Pennsylvania municipalities and precincts.

And the response of the Republican leader, that would be Senate President Joe Scarnotti, was to flatly refuse to comply, claiming that both orders from the Pennsylvania Supreme Court, the supreme court of the state that he`s in, that they were unconstitutional under the U.S. constitution.

Senator Scarnotti is legally bound to comply even while he waits for a decision from his appeal from the U.S. Supreme Court. And if he continues to refuse, the Pennsylvania Supreme Court could hold him in contempt of course and even put him in jail.

Now, that kind of flagrant lawlessness, it appears to be something of a pattern right now with the Republican Party, which is currently engaged in a full frontal attack on various institutions across the country and all levels of government, various institutions of justice that don`t suit its ends, like, for instance, what House intel chairman Devin Nunes is doing with his memo. We`ll take a deeper look at exactly what he`s up to and why, next.

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HAYES: House intelligence chairman Devin Nunes has become a national character in the ongoing drama over the Russia investigation with his secret memo that tries to discredit the people running that investigation.

And it`s not playing well with some of the folks back home in his central California district. The editorial board of the Fresno Bee this week called Nunes Trump`s stooge in a headline, writing, "Nunes of Tulare is sheltered in a relatively safe Republican district and may believe he will pay no political price for unfairly attacking law enforcement and protecting Trump, but his performance as chairman of the highly sensitive House Intelligence Committee has been nothing short of embarrassing."

And this is a billboard, one of Nunes` Democratic challengers, put up at his district office, Nunes and Trump on toddler leashes held by Russian President Vladimir Putin.

Meanwhile, back in Washington, there are growing calls for Nunes to just flat out lose his post as chair of the House Intelligence Committee. Just today, Nancy Pelosi and Chuck Schumer both called on Speaker Paul Ryan to remove Nunes, Pelosi saying Nunes` deliberately dishonest actions make him unfit to serve as chairman.

I`m joined now by Bill McEwan who spent 38 years at the Fresno Bee, is currently news director at GV Wire, a digital news site, covering California`s central valley; and Betsy Woodruff, politics reporter at The Daily Beast, who has spent the day interviewing sources about Devin Nunes.

And Bill, let me start with you, how is this all playing back in his district?

BILL MCEWEN, GV WIRE: So, I think it`s a much bigger story nationally, Chris, than it is in the district. Devin is relatively popular in the valley. As you know, it`s a conservative area. But meanwhile, because of social media, the valley residents get to see that it`s a national story and also through shows like yours. So, that`s been an interesting experience.

HAYES: What is he like? I mean, this is someone who, I think, a lot of people are trying to figure out his -- what`s his angle here? Why is he doing this? Why is he doing this in the way he`s doing this? As someone who has covered him for a while, what do you make of it?

MCEWEN: Well, he`s perfect for Trump, because just like President Trump, Devin is a transactional politician, and I`ve seen that throughout his career. He has taken a lot of votes that would benefit himself and his future. And the only other policy he really has is to attack Democrats.

But I know some people in Washington, D.C. were surprised by this whole thing when it started last year, because Representative Nunes, his reputation back there I think for 14 years was a smart guy, and a guy that was making the strategic moves to move up in the ranks in the Republican Party and he had his loyalty rewarded.

But if you knew him back here in the valley, he has been a flame thrower from day one. And, remarkably, I don`t know if you remember, Chris, but in 2010, complaining about water allotments from the Obama administration, he compared the President to Robert Mugabe and Hussein.

HAYES: That`s strong.

MCEWEN: Yeah, fairly strong.

HAYES: Betsy -- although, in the Central Valley, that kind of rhetoric goes over well.

Betsy, you`ve been talking to folks on the hill about him. What are people on both sides of the aisle saying about watching this play out?

BETSY WOODRUFF, THE DAILY BEAST: You know, one of the most interesting observations I heard today actually came from a former senior Justice Department official. What that person told me was that when Nunes was first named chairman of the intelligence committee, you know, back in the previous geolithic era before this whole Russia situation really started taking off, among folks who were in the national security law space and the intelligence space, there were some immediate concerns.

And part of the reason for those concerns was that Nunes wasn`t viewed as somebody who was a serious heavy hitter on intelligence matters, and what that would mean was that Nunes was very much going to be guided and heavily influenced by the staff he chose. He wouldn`t necessarily be in a position on individual level to make sense of some of the material that he was faced with.

The second thing that this person I spoke with said generated a lot of concern was that Nunes was viewed by somebody who was politically ambitious and he sought out the limelight. That is not what the intelligence community wants from their watchdog. In fact, in contrast is Senator Burr from North Carolina, the Republican who heads the Senate Intelligence Committee. That guy stays away from cameras. He stays away from reporters. In fact, there were concerns about his re-election bid by some Republicans because he staunchly refused to hardly ever go on television because of the sensitivity of the matters he deals with.

Nunes, meanwhile, is somebody who pulls press conferences semi frequently and was viewed even way back then as a person who really enjoyed the limelight and media attention. Both of those things set off warning signs long before the Russia stuff happened. And so, in many circles here in Washington, the way that this saga has played out is not particularly surprising.

HAYES: Bill, there`s some talk about the possibility that there`s political space for an opponent. He has won very easily. He has run unopposed. It`s a Republican district. He`s got an opponent named Andrew Janz, who has raised a fair amount of money, $65,000 in the last week. Do you think he will face a challenge, a real challenge?

MCEWEN: Well, it could be very interesting, because even though it`s a safe, Republican district, in California we have the situation with increasing numbers of independent voters. If Janz gets enough money to tell his story and could really get that message out with Independents, I expect he`s going to make it a competitive race. The question is, you know, can he get that one more vote than Devin Nunes? That remains to be seen.

HAYES: Betsy, do you think the Republicans will stick by him?

WOODRUFF: I think so. Paul Ryan hasn`t indicated whatsoever that he`s abandoning Nunes. Just from speaking with Republican members over the last few weeks, I have yet to hear any serious criticism on the house side. They think he`s doing a great job.

HAYES: There you go. Bill McEwen and Betsy Woodruff, thank you both for joining me.

That is All In for this evening. The Rachel Maddow Show starts right now. Good evening Rachel.

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

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