The Beat with Ari Melber, Transcript 8/31/17 Trump and Congress

Guests:
Brett Forrest, Mark Tushnet, Kathryn Ruemmler
Transcript:

Show: THE BEAT WITH ARI MELBER
Date: August 31, 2017

Guest: Brett Forrest, Mark Tushnet, Kathryn Ruemmler


MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES: – the Department of
Homeland Security, Elaine Duke.

ELAINE DUKE, DEPARTMENT OF HOMELAND SECURITY SECRETARY: Good afternoon.

KATY TUR, MSNBC NEWS CORRESPONDENT: Vice President Mike Pence telling
Texans that he and the administration are with them today, they will be
with them tomorrow, and they will be with them every day for this storm
effort and for the recovery afterwards.

Ari Melber takes things over now. Ari, how are you doing?

ARI MELBER, “THE BEAT WITH ARI MELBER” HOST: I`m well. Thank you, Katy.
And we`ll be monitoring that and the other developments out of Texas. But
we begin with breaking news on Bob Mueller`s Russia investigation. They
are closing in.

New prosecutors now involved in this inquiry, Mueller coordinating with New
York Attorney General Eric Schneiderman. This opens up the prospect of
prosecutions that Donald Trump could not pardon. A story we first brought
you on “The Beat” on Tuesday and that comes amidst reports that Bob Mueller
has become putting people on the stand, including a key Russian who
attended that Trump Tower meeting.

Mueller is using the secret grand jury in Washington and tonight we know
he`s using it to gather key evidence on the eight people in that Trump
Tower meeting last June. A Russian lobbyist, Rinat Akhmetshin, is the
first person who has been publicly confirmed now as a grand jury witness.
And tonight we can tell you he`s spent hours before this grand jury this
month, that`s according to a new report in the “Financial Times.”

Well, that`s the biggest news we`ve gotten on the Mueller probe in a long
time. And it`s important for legal reasons that some people may not
immediately grasp. Remember, Mueller can start anywhere. You know, he can
bring in campaign staff or White House staff or he could start with no
witnesses at all and look at evidence and e-mails and documents.

What we know tonight is that Bob Mueller is digging in to that June 9th
meeting. And according to what we know about investigative order, we can
also infer that Mueller does not view that Russian lobbyist as the criminal
target. You don`t start with the target. You start with the people who
may have the goods on the target.

So we know Mueller is moving his focus from one room in the Trump Tower to
another room, this grand jury room. And we know Mueller runs exhaustive
investigations. He won`t just hear one version of the story of what
happened in that room.

There are seven other versions potentially to be told, and it`s quite
likely each of those seven other people are going to ultimately join that
lobbyist in the grand jury room unless they`re targets or face letters of
indictment.

And while Trump may have recently learned about the pardon power, there are
signs here that Mueller is way ahead of him. More news tonight on a story
that we first broke here on “The Beat” on Tuesday.

(BEGIN VIDEO CLIP)

MELBER: We can report new findings from an MSNBC legal unit investigation
into the other way this Russia probe could continue even after pardons,
through prosecution for state crimes. The source with knowledge of one
state attorney general`s preparations tells me that office is already
looking at its potential jurisdiction for Russia related crimes.

(END VIDEO CLIP)

MELBER: That was Tuesday. Now, Politico reporting New York`s attorney
general is coordinating with his investigation with Mueller, and this is
the same attorney general who sued Trump over Trump University, many
remember that civil case.

We`ve heard a lot about Bob Mueller and that`s probably not going to
change, but today the legal Russia focus turning to New York Attorney
General Eric Schneiderman. Tomorrow, it could be an A.G. in another state
or it could be another local prosecutor like Manhattan District Attorney Cy
Vance who also has jurisdiction over potential crimes in New York like if a
potential crime was planned out of Trump Tower. We have more on that
prospect later on the beat tonight.

But for those developments in the investigation I want to directly bring in
right now the “Wall Street Journal`s” Brett Forrest. He broke that Paul
Manafort story, as well as Harvard Law Professor Mark Tushnet who has
studied how pardons could impact this case. Welcome to you both.

Brett, you look at all this. You look at Bob Mueller wanting to bring in
someone from that Trump Tower meeting, which also included Manafort that
you`ve been reporting on. Where does this head from here and why do you
think this money trail is so important and reaches so far back?

BRETT FORREST, WALL STREET JOURNAL: Those are all very good questions and
they just basically add to the mound of questions that remain unanswered.
I mean, this is a case that stretches obviously from Russia to Ukraine to
jurisdictions like Cyprus and onward from there, and obviously in our own
country.

That meeting at Trump Tower has always been intriguing for us because of
Natalia Veselnitskaya`s true intentions and her connection with the Russian
general prosecutors. So, you know, those questions you raise are important
ones to answer and we continue reporting them out.

MELBER: Let me read from your report as well as folks digest all of this
because one of the questions when you have millions of dollars floating
this direction, right, is well, what`s it all really for?

There is a benign theory of the case that Paul Manafort is simply an
incredibly good international advocate, spokesperson, strategist, and thus
is paid millions upon millions of dollars. The other theory that the
investigators that here we`re looking at and as we know tonight in more
than one jurisdiction would be that there was something else going on with
the money.

I want to read from your piece. “Manafort`s work often involved the
principle figure, Russian oligarch, Oleg Deripaska, politically connected
operators whose ventures have aligned with Putin`s objectives.” And you
say, “Deripaska has offered to give testimony about Russian meddling in the
election to those congressional committees.”

Where does this all figure to Putin and do you think we actually will hear
from this person?

FORREST: We`re not going to hear from Deripaska, at least in the context
of the House and Senate Intelligence Committees or in the context of
Mueller`s investigation. At least I don`t believe so, principally because
he`s not a trustworthy guy in the eyes of American authorities.

He had a roller coaster ride, history of getting visas to the U.S. and then
having them rescinded because the FBI has always been very interested in
interviewing him about his alleged ties to Russian organized crime, which
he has steadfastly denied over the years.

But, you know, he has promised to give the FBI information. The State
Department grants him a visa. He comes over and he doesn`t tell the FBI
anything. So investigators on the committees, they don`t take his offer
seriously.

MELBER: They don`t take it seriously, yeah.

FORREST: No, they don`t. They don`t. And they also don`t want to get in
the way of Robert Mueller`s investigation.

MELBER: Right.

FORRES: So, yeah, I mean, he`s – although this is a guy who has a
mountain of interesting and valuable information, you know, he`s not really
going to share it and he`s not really trustworthy.

MELBER: Right. Professor Tushnet, what does it mean that there could be
these local jurisdictions, local prosecutors effectively looking into the
Russia issues as well?

MARK TUSHNET, HARVARD LAW SCHOOL: The primary thing, I think, is that it
takes off the table, the possibility that central figures like Paul
Manafort will be able to go off scot-free with pardon from the President.

The President`s power to pardon extends only to federal crimes, and so the
possibility of a state crime will remain always open. That means, in turn,
that investigator Mueller and Attorney General Schneiderman have something
to deal with to place pressure on Manafort that he can`t expect to be
relieved by President Trump.

MELBER: I want to bring in, to add to this conversation a very special
guest, Kathryn Ruemmler, was a former White House Counsel to President
Obama and a former federal prosecutor.

I want to speak to you for several reasons on the news of the day, but
starting with where we are right now. Your view of how it works when
federal prosecutors may actually be coordinating with other local or state
investigations and what that means here tonight.

KATHRYN RUEMMLER, FORMER WHITE HOUSE COUNSEL TO PRESIDENT OBAMA: Well, it
can be a really effective way to precede an investigation because you can
leverage the resources not just of the special counsel`s office but also
of, you know, in this case as reported the state attorney general`s office.

And so, you know, we don`t exactly know what level of coordination is going
on, but, you know, it can be very effective if the two teams are, you know,
are collaborating and not stepping on each other.

MELBER: I want to show you the way we learn a lot about what`s on the
president`s mind. And I think this is a difference between the president
you worked for as a lawyer, President Obama, and the current president,
President Trump, and that is a social media platform called Twitter.

These are his tweets mentioning Russia. You can see almost every other day
in the months of June and July. Here we are at the end of August and he`s
drastically fallen down to just five tweets. And the most recent one
wasn`t even about the investigation itself, but rather two weeks ago he
wrote according to a new report Obama new about Russian interference two
years but he didn`t want to anger Russia.

Do you view it as a potential shift that Donald Trump`s criminal defense
attorneys seem to have finally after months got him to stop tweeting about
this investigation, at least over the last few weeks?

RUEMMLER: Oh, gosh. I`m sure they hope they have. I think that`s really
hard to tell. I mean, the sort of Twitter habit seems to be really
episodic, you know. I haven`t been able to predict any sort of pattern
through it.

But, you know, I certainly – I`m sure that they are hoping that, you know,
that he`s decided to dial it back on the Twitter and, you know, if he were
the President I were working for, you know, I think I`d probably be pretty
heavily medicated at this point.

MELBER: Professor Tushnet, I won`t ask you about what it would take to get
medication here in a stressful investigative environment, but at a certain
point it seems that a lot of the other key figures are going to go into
that grand jury room and talk about this July meeting – June meeting and
talk about what looks like a problem when you`re meeting with Russian
people promising Hillary Clinton, but that may not make for a criminal
conspiracy. What is Mueller going to look to do if those folks are going
to come in and try to offer their most benign explanation?

TUSHNET: He`s going to probe the accuracy of what they have to say by
comparing what one says to what another says. And he will also be in a
position to in some ways start offering deals to them, most obviously to
Paul Manafort, who seems to be in rather severe legal jeopardy and might
not be able to escape it through the hope of a pardon.

By placing pressure on Manafort, he can get a story about what`s going on
and what went on and then see whether other people confirm it, what the
details are, how stories converge or diverge. Basically he wants to find
out what happened in that meeting.

MELBER: And Kathryn, let me play a little bit more again from Donald
Trump`s past conversations and statements about Attorney General
Schneiderman because, while not everyone in the country is obviously
thinking about an individual A.G., Donald Trump has thought about him a
lot. They`ve tangled in New York.

He said, “Lightweight Schneiderman driving business and jobs out of New
York. Only want to self publicity, total loser.” And then on October
2014, “I had a great victory against lightweight A.G. Eric Schneiderman.
Most of his case was thrown out or gutted. Little remains.” On October
16th the nickname changed. “Read about my victory against sleazebag A.G.
Schneiderman. More people should fight when they`re right.”

In the long run, Trump ultimately had to personally pay out 25 million in
the total related Trump University litigation. But do you expect that
Donald Trump and this state attorney general are going to continue to
tangle here or is this in your view based on the public evidence a back-up
insurance plan for Mueller but not one that they may act on?

RUEMMLER: Well, I think it`s very hard to say. I mean, it certainly seems
to be, you know, at the very least that, meaning that as Professor Tushnet
said, you know, President Trump cannot pardon anybody for state crimes.
His pardon authority is limited to federal offenses. And so, you know,
there`s really nothing he can do there.

I think, you know, Attorney General Schneiderman, who I know personally,
you know, he`s a very experienced lawyer and he is – has pretty thick
skin. And I think understands that these are just sort of personal taunts
and I wouldn`t expect that in any way, shape or form to affect his
professional judgment.

MELBER: And that`s my follow-up for you. You mentioned you do know
Attorney General Schneiderman. A lot of people don`t. I mean, do you
think he has a background to deal with in the Manafort case what are very
complex, even potentially, you know, international shell corporation chains
and real tough stuff. So some of what you did I know on Enron Task Force
kind of stuff, which is not what frankly A.G.`s usually focus on?

RUEMMLER: But he does have a number of people in his office. You know,
he`s the leader of a large team of lawyers and prosecutors in his office,
many of whom do that, that kind of experience. And, you know, some of whom
spent prior parts of their careers in U.S. Attorneys offices, you know,
developing those types of skills.

The New York A.G.`s office also has, you know, a very broad set of
authorities that they can, you know, that they can use, subpoenas and the
like. In some respects even broader than what the feds have. So, you
know, I think he`s got the team, experienced team to work on this kind of a
case.

MELBER: Yeah. Here is what I want to do. Brett Forrest and Mark Tushnet,
I want to thank you both for your analysis on this story. Kathryn, as
mention, I want you to stay with me for a separate conversation I want to
have with you.

Ahead, more on this breaking stories. President Trump`s attorneys now
tonight in contact directly with Special Counsel Mueller and they`re
sending memos making their case. The Trump defends against obstruction of
justice and they say Jim Comey is surprise, not reliable.

Meanwhile, the big question we were just discussing, is there enough
pressure to make Paul Manafort flip? I`m going to bring Kathryn Ruemmler
back and talk about her experience. She worked with a man who is currently
on the Mueller team and is a specialist in flipping witnesses.

Plus, later, a beat exclusive, a former Kushner employee joins me to
discuss what she calls a hit piece that was on, guess who, Eric
Schneiderman. We`ll explain on “The Beat” tonight.

(COMMERCIAL BREAK)

MELBER: There is even more developing news tonight on Bob Mueller`s Russia
investigation. New York`s top prosecutor working with Mueller on the Paul
Manafort angle while Mueller is now pressuring Manafort`s family and his
lawyer who drew an unusual subpoena from Mueller.

According to “Wall Street Journal” report, tonight there are signs that
Trump`s lawyers, though, are pushing back. They want to change the topic
from these stories about Russia`s in the grand jury room, about Manafort`s
struggles, to a new topic. They want to debate Jim Comey and they`re
leaking their opinion that Trump had the power to fire Comey and that it
had nothing to do with obstruction.

Now, Mueller`s team will certainly assess those defenses. They`re going to
read anything that Trump`s lawyers send over, but they`re not backing an
inch of the pressure on Manafort.

In fact, Mueller`s have Prosecutor Andrew Weissmann who is know for his
probing investigations and flipping witnesses in the famous Enron case.
That was the complex fraud case.

Another key prosecutor on that team who you just met moments ago on “The
Beat,” Kathryn Ruemmler, once recounted how Weissmann is willing to take
risks to secure witness testimony that other prosecutors might not.

Now, Ruemmler helped secure the Enron convictions and went on to serve as
White House counsel to President Obama. You can see it there, the former
president. A talented lawyer, himself, said that he picked Ruemmler has
his top lawyer because she, “had an uncanny ability to see around corners
that no one else anticipates.”

Back with us is that lawyer, Kathryn Ruemmler. Appreciate you being here
on such a busy night. Let me ask you since Barack Obama thought you had
this skill, and I believe him, your old boss, what corners do you think
Mueller is looking around now?

RUEMMLER: Well, that`s a great question. And let me just say at the
outset that I have absolutely no information at all about what evidence
they`ve actually collected, you know, what they`re really looking at other
than what I`ve read in the papers. So, you know, my observations and
opinions here are really based solely on publicly available information
and, you know, knowing a number of the players involved. So I will say
that at the outset.

MELBER: It`s a modest way of saying while you don`t have any secret grand
jury material, you`re drawing on your experience overseeing 45 lawyers in
the White House working for a president. I get it.

RUEMMLER: Yes. So, you know, look, I think that what you have embodied in
the special counsel team, led by Bob Mueller, is just an extraordinary
amount of experience and probably more experience, you know, within a
single team or group of prosecutors than we`ve seen in recent history, you
know, working on a single matter. The breath of cases that they have
investigated and prosecuted over many years is really unparallel.

And so that – it`s that experience that allows somebody to really see
around corners, to anticipate the types of defenses, the types of legal
challenges that might be brought against investigative actions that they`re
taking, but also, you know, to really understand how people who are trying
to conceal potential misconduct go about doing it. You just – you
couldn`t have, you know, just a greater wealth of experience than this team
has.

MELBER: Right. And then you look at these leaks to the “Wall Street
Journal” which to my legal eyes didn`t have anything really new in them. I
mean, people are going to be hearing about this tonight and tomorrow. It
was basically a leak saying that Trump`s lawyers think that he has the
power to fire Comey.

They`ve met with Mueller in recent months, submitted memos arguing that the
President has that power basically. That he didn`t obstruct justice. And
they also question Comey`s reliability, which is standard operating
procedure.

What I don`t see here in the report is anything new or even necessarily
newsworthy, other than that it`s coming from them. And then I`ll decode
this for, you know, this would – you know, they then say to the journal,
“Oh, we have no comment. We`d never comment on anything, the leaks from
their memo.” So obviously they either lost them in a park in Washington or
they gave them to the “Wall Street Journal.”

Your view of that part of the strategy, because my understanding, yours
being far more important, but my understanding is the question isn`t
whether you have the authority to fire Comey. That`s not in doubt. The
question is whether you abuse the authority to fire him in a manner that
might obstruct or impede justice under federal law.

RUEMMLER: That`s right. The motive, the why, why was he fired is
incredibly important here. And, you know, that`s what in part I think what
the special counsel will be investigating and looking at. So the fact that
he had the inherent legal authority is relevant, but it`s not dispositive.

MELBER: Right. Well, let me turn to the other piece. So I initially
invited you on to discuss, which is we`ve been mentioning Mueller and the
attorney general of New York looking into the financial transactions.

Paul Manafort having received $40 million from this Russian oligarch over
several years and we`re going to show you how to follow the money. 12.7
million from political work in Ukraine over two years. Since then,
Manafort then, you see there in New York, purchases four properties, three
of them in cash. And he purchases a mansion down there in Florida.

Now, some of those properties bought under shadow companies linked to
Manafort, which then transferred the properties back to him for a zero-
dollar transaction. Manafort also reportedly taking out loans on several
of those properties, which can look odd if you are flush enough to have
originally bought them in cash, looks like he may be facing legal jeopardy.

A former prosecutor in Illinois U.S. attorney`s office saying, “If I
represented Paul Manafort, I would conclude my client has significant
criminal liability.” And this is an area where the liability may be for
both the federal and the state crimes, money-laundering being a key
example.

So walk us through this, Kathy. If Manafort is being pushed on all of
this, and then he puts down a card and says, “Well, I have a get out of
jail free card from the President,” I think I can get it.

And now what seems to be new today is these investigators pushing back and
saying, well, here`s another card. You could go to jail in New York. It
could be even tougher. And then the question is, what card does Manafort`s
legal team play after that?

RUEMMLER: Right. Well, we don`t know exactly what cards are being played.
But it`s a pretty weak card to play with the prosecutor is that I might get
a presidential pardon in the future.

And I know there`s been a lot of speculation that, you know, President
Trump was sending a signal to everybody in the Russia probe with the Arpaio
pardon that, you know, he was going to hand out, hand out pardons like, you
know, trick-or-treat candy on Halloween.

But from your – from a prosecutor`s perspective, if someone comes in and
says that, you know, that`s just really not an enormous amount of leverage.
And, you know, I`m so glad that you said follow the money, because what the
team, the prosecution team is – the investigation team is really going to
be doing in significant part is following the money. That`s how you
investigate these cases. And, you know, asymmetry of information is the
power that the special counsel and the prosecutors have.

Paul Manafort or any other individual who is caught up in this probe, they
have no idea what evidence that the special counsel has gathered. And so,
you know, they`re in a way, they`re sort of flying a little blind and
that`s really where the true power comes from.

MELBER: Right.

RUEMMLER: And the leverage and the ability to, you know, to get a witness
to sort of come to the table and tell the truth and come clean, and that`s
really the goal.

MELBER: Well, you make such an interesting point. What you`re calling the
asymmetry of information, right? I mean, in newsrooms we`re just learning
who was brought before the grand jury secretly, weeks ago. It`s new
because it`s newly revealed. But it was weeks ago that this first
individual, a Russian lobbyist went into the grand jury room to talk about
that meeting.

We don`t know over the next two weeks, and as to your point, Paul
Manafort`s lawyers and he probably don`t know what other people from that
meeting went in. And you usually don`t want to be the last one in, the
seventh or eighth person talk to you about it. But as you say it`s
asymmetrical, what I want to ask you about is to build on that point and
also put in the context of the money.

I`m going to put it on the screen again for the viewers` benefit these
shell companies linked to Manafort. You`ve got the purchased of a Trump
Tower apartment, that`s how he got to know Trump initially all the way back
in `06, 3.6 million, New York condo in `07, 2.5 million, Florida mansion,
1.5 million in `07, few years later, a New York City loft for 2.85 million,
also a cash purchase as I mentioned, and in 2012, a Brooklyn brownstone for
about 3 million in cash.

And who wouldn`t want a $3 million Brownstone in Brooklyn, it`s a great
thing, a lot of properties. How do investigators look at this and say,
“OK, are you just a super successful businessman who puts a lot of money
down in cash? Or do you expose yourself to criminal liability for money-
laundering?”

RUEMMLER: You might. I mean, what – it certainly raises a lot of red
flags, right, which is making this big purchases with cash. It might be
completely legitimate, but it might not. And so with the prosecutor, what
you`d want to say is, “OK, well, where did that money come from?” That`s
really the key question.

And so that`s why when we talk about following the money, you want to trace
it back. Where did it come from? And, you know, people don`t usually just
carry around, you know, $3.65 million in cash. It`s somewhere in a bank
and how did it get into that bank? And what, you know, what was the
originating bank? And so, you know –

MELBER: Yeah. I don`t think Scrooge McDuck had $3.65 in coin. I mean,
that`s a lot of money for cash.

RUEMMLER: Right. That`s exactly right. So a lot of money for cash,
although, you know, people do, particularly in Manhattan, people do, you
know, make large purchases of real estate as you know, Ari, with cash. But
nevertheless, these are, you know, questions that you`d want to ask and
you`d want to know.

And there are probably a whole lot of bank records that give you, you know,
a very substantial trail about where the money originated from. And when
you`re talking about money-laundering, what gives rise to a money
laundering violation is if the money came from, you know, particular types
of what the statute says, unlawful specified activity. So if there`s an
underlying, you know, criminal activity –

MELBER: Right.

RUEMMLER: – that you engaged in and then you tried to conceal it through,
you know, putting the proceeds of that into a real estate deal and to a
condo or something, then that`s a separate offense, separate and apart from
whatever, you know, whether it was a narcotics deal where you got, you
know, 5 million bucks from selling however many kilos of cocaine and then
you put – tried to put it into an apartment in order to conceal that
source of those funds, that`s a separate offense of money-laundering.

MELBER: Right. And that`s where you get the crimes, you know, stacking up
to your point. As a former federal prosecutor who worked under Mueller`s
Enron Task Force on complex fraud and as a former counselor of President
Obama we are very lucky to have a lot of your expertise tonight. Kathryn
Ruemmler, thank you.

RUEMMLER: It was great to be here. Thanks Ari.

MELBER: Thank you. Now coming up, a new report that indicates Jared
Kushner is under much greater financial pressure than ever previously
known. What does that mean for the Russian query?

And an exclusive, I`m going to speak to the former editor in chief of the
“New York Observer” paper. You see it there with Kushner. She says that
he at times tried to use the paper to go after Trump`s political enemies,
including the New York State General Attorney Eric Schneiderman.

(COMMERCIAL BREAK)

ARI MELBER, MSNBC HOST: Donald Trump and his family members in the west
wing said they`ll forgo or donate their government salaries on the idea
they don`t need the money and their wealth makes them independent. But it
turns out it`s the opposite for Jared Kushner. According to a new report
by Caleb Melby in Bloomberg, Kushner`s family company is failing a
stressful debt, now $600 million all from a skyscraper his company bought
in2007. At that time, 666 Fifth Avenue commanded the highest price ever
paid for a single building. And it`s not aging well. The bill is due in
under two years and the building doesn`t make enough to even cover all that
rent. Bloomberg reporting that Kushner Executives unsuccessfully sought
investments from all over the world. South Korea and sovereign wealth
funds, France`s richest man, Israeli banks and insurance companies and even
exploratory talks with a Saudi developer.

Meanwhile, federal investigators want to know if the Fifth Avenue
building`s finances came up in that post-election meeting Kushner had with
the head of Russia`s state-controlled development bank. With me is Caleb
Melby who broke the story for Bloomberg. What did you find? And does any
of this increased pressure on Kushner that could affect the way he governs
or meet with foreign officials?

CALEB MELBY, BLOOMBERG REPORTER: Yes. Pressure is definitely mounting on
both Kushner and his family. This debt is due February 2019. And look,
they`ve already looked a lot of different places. And it`s the sort of
situation where they don`t have a lot of potential investors. The plan
they have to save the building involves raising it and a building, that new
fancy one with a bunch of – like a mall on the bottom, hotel on top of
that, condos that would go from $9,000 per square foot.

MELBER: Yes. Can I ask you about that? Your report is so exhaustive.
And right in the middle you`re like, their plan to make up the $600 million
debt as I understand it, and I`m not a financial expert, their plan was to
go billions more in debt, do I have that right?

MELBY: Yes. They – to look for financing, to help them pay off their
current debts and take out you know, like a $4 billion construction loan,
$1 billion to buy back the stores and half the office towers that they`ve
sold off –

MELBER: So, how is that different than being at the blackjack table and
being down and saying but if I keep gambling I`ll make it all back?

MELBY: I mean in some ways it`s not. It`s definitely a moon shot
development project, right? It`s a – it`s a big plan that they have to
save themselves on this building.

MELBER: At this point would you say as a financial matter, they are
desperate or super-desperate?

MELBY: They`re facing some very steep challenges and they`re only going to
keep getting worse until February 2019.

MELBER: Caleb Melby with the story everyone is talking about today, thank
you for coming on the show.

We turn now to a BEAT Exclusive, Kushner facing this heat from Mueller as
news breaks that the New York Attorney General Eric Schneiderman was
coordinating with Mueller on potential Russia inquiry. Schneiderman
previously sued Trump over Trump University and dispute that drilling
Kushner as Trump firstborn, he was, “those currently doing a story on me to
get even.” And then he threatened more reaction. And within three months,
an aggressive report on Schneiderman did come out in a paper owned by Jared
Kushner alleging Schneiderman had been heavy-handed in using his power to
threaten action, overlooked cases against friends and target enemies. It
featured a cartoon depicting Schneiderman from clockwork orange as a kind
of sociopath. The back story may be more interesting.

The New York Times reporting that the Observer`s editor at the time Ken
Kurson, asked a 21 – excuse me 28-year-old ice cream store manager, to
write the article and he wouldn`t do it. And Gifford said Kurson described
Schneiderman as a bad guy and a phony and send in a negative article about
Schneiderman. Elizabeth Spiers ran the Observer under Kushner for a year.
She departed before that piece was published. She joins me today. Says she
says no serious reporter would touch that piece on Schneiderman and that it
reflected an agenda by Kushner to attack Schneiderman all as pay-back over
the Trump University suit. A back-story that`s even more interesting,
given that Schneiderman is now working with Mueller. Elizabeth Spiers is
here along with Slate`s Michelle Goldberg. Elizabeth, what was going on
and did Kushner see the newspaper as a place to simply settle scores for
Donald Trump?

ELIZABETH SPIERS, JOURNALIST: I`m not sure he did it as a matter of scores
but one thing that`s important to remember is that the editor of the
newspaper at the time was a family friend of the Kushner`s, and a former
political operative. He didn`t have a traditional journalism background
and so I think he understood what Jared wanted to happen or what would be
in the best interests of Donald Trump. So if you read the story, which is
a fairly long profile, it`s 7,000 words. I was counting on my phone how
many times Mr. Trump or Donald Trump appears in that story. That`s 47
times. It`s possibly more times than the story mentions Eric Schneiderman.

MELBER: Yes, if you put it on the screen, there`s about 3,500 total words
in the article there. The number of words in the observer article and a
lot of them there were about sentences defending Trump in one way or the
other.

SPIERS: Sure. And also, the article explicitly states that the most
important thing that Schneiderman was working on at the time was the Trump
University case, which is preposterous. If you understand what the New
York Attorney General actually does. And it really reflected a world view
that was I think coming from the Kushner camp.

MELBER: I want to ask you and then go to Michelle that, did this reflect a
desire to change the legal outcome or just an emotional desire to hurt Eric
Schneiderman, who is now working with Mueller?

SPIERS: Yes, I think it was just a reactionary thing. You know, I don`t
think A, it would have affected the legal outcome but I think it was just
an emotional backlash to what was happening. I think it also important to
mention that at least before Schneiderman went out after Trump University.
He had a seemingly good relationship with Jared and Ivanka. I went to
breakfast in 2011 that Jared and Ivanka hosted for Schneiderman. And I
didn`t get the impression that they knew each other well, but they seemed
to be on good terms. And this was before Schneiderman went after Trump
University.

MELBER: Right. And Jared and Ivanka had a lot of political relationships
including with Democrats as his father did. You mention the denials, I
want to read it here in the piece that they wrote, “Jared`s father-in-law
is Donald Trump, given that family relationship, the Observer took great
care to ensure fair, unbiased journalism throughout the reporting and
ending of this story. As a matter of fairness, we mention they denied that
this was a hit piece although we explained some of the contexts.”

MICHELLE GOLDBERG, SLATE COLUMNIST: I just think it shows how ethically
slippery these characters are, which matters in regards to the Bloomberg
story, because this is somebody who is so deeply in debt and deeply
compromised that even if he had the most bullet-proof ethics in the world,
it would be very problematic to have him in this position where he`s at
once the kind of the main interface between the U.S. government and various
foreign leaders, with this massive portfolio that seems to span all of
American interests all over the world that he`s both doing it on behalf of
the U.S. government.

And at the same time desperately – his family is desperately scrounging
for foreign investments to rescue their company and their legacy. Even if
you had someone who was willing to make the strongest possible ethical
division between their personal interest and their professional role, this
would still be a mess. And this is just – I think this story about how he
used the Observer as you know, sort of an attack dog against his political
enemies shows that he has none of those ethical boundaries. I mean, the
potential for corruption here is so incredibly staggering.

MELBER: Right, because he owes so much. Elizabeth, you were working with
Jared Kushner at the time. Trump was getting more politically vocal. Did
you ever talk to him about the birther attacks on Obama and those kinds of
things? What did he think he thinks of that then?

SPIERS: Yes, I mean, we – Trump was running in the 2011-2012 cycle, but
didn`t have the traction that he had in the last cycle. And so, the paper
had to cover Trump in the sense that not as much as we ever cover national
politics. We were aggregating stories. So this would come up routinely.
And at one point, we aggregated a relatively neutral story from the Times,
but it happened to have some negative information and then Jared wanted to
discuss it. And I said, well, you know, we`re just taking the neutral
summary of it. And he said, well, Elizabeth, you know, if you spent time
with my father in law, you`d really like him.

And I said, well, that might be true, but it really wouldn`t change the way
the paper covered him. Then I said, I have to be honest with you, your
father in law has done some things that I find morally repellent. And he
said, like what? And I brought up the birther stuff. He said I just find
it categorically – it`s racist. And he looked at me and said, well
Elizabeth, you know, he doesn`t mean any of those things, he`s just saying
it because he thinks Republicans are dumb and they`ll buy it.

MELBER: Kushner said that he – Kushner said he thought that Donald Trump
thought Republicans were dumb.

SPIERS: Yes. And there`s a possibility here that Jared is lying to me
because he thinks that that`s a more palatable answer. But either way, I
mean, it says something about both of their characters, regardless of which
version is true.

MELBER: And we`ve got to go. Was there anyone else in the room or that he
just said he is proud of.

SPIERS: Yes, he just said this to me in a meeting we had.

MELBER: I learn something every time I talk to both of you. Elizabeth and
Michelle, thank you, both.

SPIERS: Thank you.

GOLDBERG: Thank you.

MELBER: I appreciate it. Coming up, could President Trump actually have
to testify under oath in the Russia inquiry live? I have a Democratic
Congressman with an idea about that, next.

(COMMERCIAL BREAK)

MELBER: Welcome back. I`m joined now by Congressman Eric Shawlwell, a key
figure in the Democratic side into the investigation in the Russian probe.
Thank you for being here on a busy night. Do you think that at this point,
it`s important for your investigation to have Donald Trump himself testify?

REP. ERIC SWALWELL (D), CALIFORNIA: I thank you, Ari. And first, let me
just say as we see the images in Houston that are breaking our heart.
We`re going to be back in Washington in a few days and Congress must pass
aid immediately. We shouldn`t do anything else. We always speak with one
voice in a disaster. But moving to the Russia investigation, Ari, we need
to hear from all relevant witnesses. And until we do that, we will not
have a complete investigation. And what we know right now about the
President is that he sought to do business in Moscow when Russia was
interfering in our elections. We also know that his team was willing to
receive information from the Russians in the midst of the Presidential
campaign. And so at this point, it`s too early to say whether he is called
in or not but if he`s a relevant witness, it shouldn`t be taken off the
table.

MELBER: So you`re saying it`s on the table to potentially try to compel
him to testify?

SWALWELL: And I speak for myself. You know, it`s ultimately a call of
Mike Conaway our Chair and Ranking Member Schiff. But I do believe that
bipartisan concern should be that this is an exhaustive investigation that
understands completely the personal, political, financial nature of this
relationship.

MELBER: Congressman you site the disclosure that Donald Trump`s aides were
seeking help from the Kremlin to do business in Moscow during the campaign.
He said the opposite during the campaign, was he lying?

SWALWELL: Yes. I hate to say that about our President, but the evidence
is clear. That he went from saying there were no Russians, then we found
out there were a lot of Russians, a constellation of Russians. Then he
said there was no collusion. Well, now we know that the aides sought to
have a working relationship with the Russians. And the President has
essentially taken this, I believe, Ari to a point of so what? That`s
politics. Who wouldn`t have taken the meeting? And that`s a very
destructive and I think just pessimistic attitude. And I don`t think
Americans are going to go for it. They care.

MELBER: Based on these disclosures, do you think it is now more likely
that his tax returns reflect some deals or debts linked to Russia?

SWALWELL: Well, you know, you also have to assume that people are
forthcoming in their tax returns. But I don`t see how we could conduct
this investigation without fully understanding Donald Trump`s personal,
financial and political contacts to Russia and that would include tax
returns.

MELBER: And finally, with all these disclosures and these reports we`ve
had tonight on local investigations, is your view that that is OK or that
with Mueller going and your investigation going, state AGs should not be
pushing forward?

SWALWELL: Well, it happens all the time, Ari, that to be efficient and
when multiple jurisdictions are invoked, that they work together. I don`t
think they should treat Donald Trump any differently. But if you know
there were state laws that are implicated, they certainly should work
together to avoid redundancies. In our investigation, Ari, we just want to
have independence, credibility and make progress and hopefully do
everything we can so that when we go to the ballot box in 2018, we are
never in a mess like this again.

MELBER: Well, as a member of this investigative body, I think you did make
some news here tonight saying number one, Donald Trump could be a relevant
witness. You may potentially look to coordinate with your colleagues to
have him testify. Number two, you think he was lying about not seeking
business deals in Russia. Congressman Swalwell, thank you for joining us.

SWALWELL: My pleasure.

MELBER: I appreciate it. And I want to turn to the Daily Beast Betsy
Woodruff and Cornell Belcher, Democratic Pollster who has worked for
President Obama. What do you think we just heard there, Cornell?

CORNELL BELCHER, DEMOCRATIC POLLSTER: You know, I want to hope for the
best but I got to tell you, Ari, I find it hard to believe that a
Republican-controlled Congress is going to allow that to happen. I think
it`s the right thing, I think most Americans probably think it`s the right
thing when you look at the polling out there now with Americans concerned
about Russian meddling. But in the end, I think politics is going to win
out. I think it would be tremendous for Republican leaders in Congress to
allow that to happen.

MELBER: Betsy?

BETSY WOODRUFF, THE DAILY BEAST POLITICAL REPORTER: What stood out to me
is what he said about the possibility of President Trump talking to
Congress. I don`t think that`s likely in Congress, but I`ll honestly be
surprised if Mueller doesn`t try to question President Trump. I spoke a
while back with Jack Danforth, the only other person who`s been his Special
Counsel under the same authority under which Mueller is working. Danforth
investigated the Waco crisis during the Bill Clinton administration. And
he told me that while he was running that Special Counsel probe he called
Bill Clinton and they talked and it was a conversation for the purposes of
his investigation even though Bill Clinton didn`t have a huge involvement
in what happened at Waco. So there`s absolutely precedent for Special
Counsel investigators to ask questions of the President about the issues
they`re investigating, and I`d be surprised frankly if that`s not on the
table for Mueller.

MELBER: And Cornell, I mean, doesn`t that also depend on whether
Republicans ultimately long term in the Congress learn enough that they
want to take a more adversarial approach based on what`s exposed?

BELCHER: Well, you know, we`re talking politics, right? And you`re
looking at the mid-terms coming up where there are already you know,
challenging political environment out there. You know, are Republicans in
the House really going to put the President front and center in this
conversation and have for weeks or months on going into the midterm
election where they`re already really nervous about this going into a
midterm election and then particularly with the base of the – you know,
the core of Trump supporters. You know, House Republicans and Senate
Republicans really need the base of the Republican Party to come out in
force for them. And we see any drop-offs in that and they see them coming
after their guy or helping Democrats come after their guy, it is tough
politically for Republicans to do that.

MELBER: And the other thing I wanted to cover, stepping away from Russia,
Cornell, this is some police audio. I don`t know if folks have – do we
have this in the control room? All right, we`re going to cue up this.
This is basically something folks may not have heard about yet but would be
a really big story if we weren`t covering everything else. And this is
dash cam audio that`s been exposed. An investigation has been ordered.
But I want to play it for you here so we can assess it and get your
reaction.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Now, listen to me. Call the person who`s coming to get
you. Tell them they don`t need to come. All right?

UNIDENTIFIED FEMALE: (INAUDIBLE)

UNIDENTIFIED MALE: Yes. Go ahead and call them. I`m going to take you to
jail and I`m going to impound the car.

UNIDENTIFIED FEMALE: I can`t call them if you don`t open the door.

UNIDENTIFIED MALE: Why can`t you?

UNIDENTIFIED FEMALE: Because I will not put my –

UNIDENTIFIED MALE: Use your phone. It`s in your lap right there.

UNIDENTIFIED FEMALE: OK, I will, I just don`t want to put my hands down.
I`m really sorry.

UNIDENTIFIED MALE: Use your phone.

UNIDENTIFIED FEMALE: No, no, no. I`ve just seen way too many videos of
cops –

UNIDENTIFIED MALE: But you`re not black. Remember, we only kill black
people. Yes, we only kill black people, right? All the videos you`ve
seen, have you seen any white people get killed? You have?

(END VIDEO CLIP)

MELBER: In Georgia there. What do you make of that, Cornell?

BELCHER: I almost don`t know – I`m speechless, right? It is – it is an
acknowledgment by a police officer of what`s happening in this country.
And for all those people who want to say that this is – you know, black
people whining and making this stuff up, no, it`s not black people whining
and making this stuff up. This stuff is real. And the police out there on
the force know it as well. They – that`s basically an admission that
there is two standards in America. There is a standard for when you pull
over white people where they probably will – likely that you know, you can
reach for things. And a standard for black people where you cannot reach
for things or you, in fact, may get shot. And I`ve got to tell you, as a
black person, I don`t reach for anything when pulled over by a cop, right?
I don`t - I don`t reach for anything, I tell my kids not to reach for
anything. That`s as real, and it`s scary, and it`s – and it`s disgusting.

MELBER: Well, looking at that video and seeing an officer say that in the
line of duty under the cover of law, it is shocking even if you know these
stories. Betsy and Cornell, thank you, both. We`ll be right back.

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

Copyright 2017 ASC Services II Media, LLC. All materials herein are
protected by United States copyright law and may not be reproduced,
distributed, transmitted, displayed, published or broadcast without the
prior written permission of ASC Services II Media, LLC. You may not alter
or remove any trademark, copyright or other notice from copies of the
content.>