The Rachel Maddow Show, Transcript 05/04/09

Guests:
Christopher Beam, Austan Goolsbee, Andrea Mitchell, Steve Benen, Kent Jones
Transcript:

RACHEL MADDOW, HOST:  And thank you at home for staying with us for this hour.

We will be reporting on the Republican rebranding pizza parties; the strange overlap between the Kentucky Derby and the Senator Ted Stevens‘ corruption trial; and we will be taking a look at a man who will be the top Republican considering President Obama‘s horrible, liberal, activist, empathetic, communist Supreme Court nominee who doesn‘t exist yet.

But we will start with a nice, relaxing trip to the Cayman Islands.  The Cayman Islands, proud home to a beach that is seven miles long, proud home to a stingray population that is unrivaled in the world, proud home to hundreds perhaps thousands of American companies enjoying the avoidance of paying American taxes.

And what surely will deal a blow to his popularity among tax-avoiding American businesses and, presumably, the geniuses who rent out P.O. boxes in the Cayman Islands, today President Obama announced that his administration will finally stop American companies from stashing their profits in offshore tax havens.

(BEGIN VIDEO CLIP)

               

PRES. BARACK OBAMA, UNITED STATES:  For years, we‘ve talked about shutting down overseas tax havens that let companies set up operations to avoid paying taxes in America.  That‘s what our budget will finally do.  That‘s why we are closing one of our biggest tax loopholes.  It‘s a loophole that lets subsidiaries of some of our largest companies tell the IRS that they‘re paying taxes abroad, tell foreign governments that they‘re paying taxes elsewhere—and avoid paying taxes anywhere.

(END VIDEO CLIP)

MADDOW:  Shutting down overseas tax havens.  What does this mean to the average American?

Well, let‘s say you‘re a guy living in Houston, Texas.  Say you are Bill Smith of Houston, Texas.  Bill Smith makes, say, $50,000 a year.  Twenty-five percent of Bill‘s income is taxed by the federal government.

Now, if you‘re a business headquartered in Houston, Texas, 35 percent of your profits are taxed.  That‘s the corporate tax rate.

But if you were a business headquartered in Houston, Texas, like the defense contractor KBR, say, and you set up shell companies offshore, in that case, zero percent of those profits are taxed by the federal government—which could realistically mean that Bill Smith could pay more taxes than KBR.  Not relatively more, not as a proportion more, just more.  Bill could end up literally paying more dollars to the government in taxes than a giant corporation does.

How big a problem is this?  Here comes the “Let‘s take a trip to the Cayman Islands” part of our program.  What you see here is an address in the Cayman Islands listed as Ugland House.  It is a five-story building home to 18,887 businesses—or I should say, it‘s home to the fake headquarters of 18,857 companies that want to look like they‘re headquartered there in order to avoid paying taxes somewhere else.  If there really were 18,857 businesses there, don‘t you think the parking lot would be a little bigger?

Places like the Cayman Islands, Liechtenstein, the Isle of Man—these have become go-to destinations for U.S. companies to set up fake headquarters so they can avoid paying U.S. taxes on their profits.  So, when you think Bank of America, think actually more like Bank of the Bahamas, Bank of Bermuda., Bank of Cayman Islands, Bank of Gibraltar, Bank of Luxembourg.

In the year 2007, Bank of America had 115 foreign subsidiaries headquartered in places that would allow them to pay little or no taxes.  Morgan Stanley registered 273 subsidiaries in far flung tax-friendly locales like the Marshall Islands, the Island of Jersey, and, yes, the Cayman Islands.

How about Citigroup?  Citigroup, an incredible 427 separate subsidiaries registered in tax havens, including 91 of them in Luxembourg, 12 in the Channel Islands, and stop me if you heard this one before, 90 of them in the Cayman Islands.

What do Bank of America, Citigroup and Morgan Stanley all have in common aside in their shared interests in paying no taxes?  They‘re all recipients of our very generous taxpayer largess.  They have been bailed out by our taxpayer dollars in the past year.  Yet, they‘re stiffing us when it comes to their taxpayer dollars.

And, yes, before you e-mail me, Rachel@MSNBC.com — yes, General Electric, the parent company of this network, in 2007, operated seven subsidiaries in Bermuda, Luxembourg and Singapore.  This is not an individual, bad companies problem; this is a tax code problem.

Stopping U.S. companies from not paying taxes on their profits overseas, closing that loophole would bring in about $21 billion in tax revenue each year—revenue that is owed but is not being paid because of scams like the 18,000 companies in that one building in the Ugland House.

The Republican Party has decided to come down on the side, remarkably.  They have decided to come down on the side of the scam, pitting their political future on fighting for the rights of American companies to avoid paying taxes in America.  Like individual Americans do.

Ever attune to the populist sentiments to his constituents, Republican Senate Minority Leader Mitch McConnell, he called the president‘s plan, quote, “a significant tax increase on companies.”

Actually, the tax rate isn‘t going up at all.  It‘s just that corporations used to dodging taxes now will have to pay them.  It‘s very revolutionary.  I know.

Joining us now is senior White House economist, Austan Goolsbee.  He is the chief economist for President Obama‘s Economic Recovery Advisory board.

Dr. Goolsbee, thank you so much for joining us tonight.

AUSTAN GOOLSBEE, SENIOR WHITE HOUSE ECONOMIST:  Great to see you again, Rachel.

MADDOW:  Let me give you an opportunity to correct anything that I got wrong there.  Did I misstate the facts at all in terms of what the situation is?

GOOLSBEE:  Oh, I don‘t think so.  And, Rachel, I‘m just—I‘m a tax economist.  To hear you give the lecture on international tax evasion and avoidance, I‘m just on a buzz.  I can‘t believe it.

MADDOW:  Now you know how I feel when people talk about infrastructure.  Ooh!  It‘s the same thing.

All right.  Senate Minority Leader Mitch McConnell says that what—this plan announced today would be a tax increase on businesses.  What‘s your reaction to that?

GOOLSBEE:  Look, the president got criticized in the campaign and as

far as back as several years ago when he‘s been calling for restricting tax

havens and trying to end the tax breaks for companies who shift jobs

overseas and give the tax breaks to companies that employ people and do

research and development here in the United States.  He‘s been criticized

by, in certain pockets.

               

I thought it was unbelievably cheeky of Senator McConnell to come out on the side of calling this a tax increase when the president laid out, quite specifically, “Let‘s use this money to make the R&D tax credit—finally make it permanent so that we can incentivize people to do research in the United States.  I mean, he‘s been—the president has been calling for this for a long time.  And we‘re finally going to go out and make this happen.

MADDOW:  And the idea with the R&D tax credit is that you would stop people from evading paying corporate income taxes by using these offshore tax havens.  But then, some of that revenue that was captured because you stopped people from evading taxes you would essentially give back to businesses in the form of tax credits for research and development.  Is that right?

GOOLSBEE:  Yes.  That‘s exactly right.  And look, the point is, the U.S. tax code has been filled with loopholes and things over the years such that you now have a way large diversity of tax rates, even within business, it‘s not fair.  You‘ve got companies that are big multinationals that can afford all kinds of tax shelters and tax planning paying very low rates.  And then you‘ve got companies that are just trying to expand and work in the U.S., and they‘re paying through the nose because the rates are higher.

We need to equalize these rates and just use common sense rules, like, if you‘re taking deductions for the expenses overseas, you ought to first report the profits from overseas.  So you‘ve got to pay taxes on the profits before you can take all of the expenses to reduce your tax bill which is what the current system does.

MADDOW:  The opposition to this from business interest is already seemingly pretty fierce.  And, you know, tactically the hallmark of the administration thus far has been conciliation over confrontation wherever possible.  I wonder if it is possible to avoid a direct confrontation with big businesses who have been fitted from this tax dodge over the years about this plan.

GOOLSBEE:  I don‘t know that I totally agree with the characterization that it‘s always conciliation and we never get in an argument about anything.  I think there‘s going to be some businesses that oppose this.  I know in the campaign when we first started describing this, we got a complaint from the lobbyist for either the Isle of Guernsey or Vanuatu or somewhere, that they felt that they were being singled out for being a tax haven.

Look, I—of course, some people are going to complain.  But I think if you sit down with 95 percent of the American people and just explain to them what‘s happening, that there are companies, that right now our incentives are not aligned, the companies can make money by shipping jobs overseas, and we can change the tax code so that companies can make money by growing jobs at home, I think everybody‘s basically on board with that.

MADDOW:  John F. Kennedy is the first president that I know to have talked about trying to close this type of tax loophole.  Presidents talk about trying to do this.  Candidate Obama, Senator Obama, now President Obama, as you say, has been talking about this for a long time.  Why hasn‘t it happened so far?  What do you think makes this time different?

GOOLSBEE:  Well, that‘s a tough question to answer why it hasn‘t happened in the past.  I mean, certainly, the power of special interest in this area is really quite large.  I think we haven‘t seen as much emphasis in recent years on really putting forward concrete ideas of how would you do it, and sort of confronting the special interest where they—where they live on these issues, and putting forward an alternative, which is—let‘s try to get business and the American people and the economy all on the same page so everybody‘s going the same direction.

I think now is also a bit different because the president is coming in with a clear mandate that we‘re going to change the way business has been done, and he was very vocal throughout the campaign that looking at the loopholes in the corporate tax code is going to be one of the first things he does when he gets in office.

MADDOW:  I look forward to the fight in Congress with Republicans defending the tax dodge.  I think it‘s going to make for some good political feeder.

Senior White House economist, Austan Goolsbee, it‘s really, really nice to have you on the show.  Thanks for your time tonight.

GOOLSBEE:  Great to talk to you.

MADDOW:  We can now reveal the secret weapon by which the Republican Party will catapult itself back into the good graces of the American electorate.  It is pizza.  They‘re rebranding began at a pizza parlor this weekend in Virginia.

This is the part where I force myself to not make the joke about their brand being cheesy with lots of dough.  I‘m sorry.  We will have a report from a witness coming up next.

But first, One More Thing about bailed out American businesses.  We have been waiting for yet another name-change from AIG, the giant insurance company of which we, the people, own about 80 percent.  Having tried AIU and finding that to be not different enough from AIG, the folks who almost turned the globe into a soup line have now come up with yet another new name.  It‘s VALIC—V-A-L-I-C.  VALIC is AIG‘s latest attempt to make us forget that it is AIG.  They say VALIC is short for Variable Life Insurance Company—which I think means that, actually, should be VLIC.

I wonder if I should tell them.

(COMMERCIAL BREAK)

MADDOW:  After President Obama‘s inauguration, on the issue of gays in the military, the official White House Web site said this, quote, “President Obama agrees that we need to repeal the ‘Don‘t Ask, Don‘t Tell‘ policy.”  At some point between then and now, the president‘s position on the Web site morphed and it instead read this, quote, “He supports changing ‘Don‘t Ask, Don‘t Tell‘ in a sensible way that strengthens our armed forces and our national security.”

Changing, whether or not it‘s in a sensible way, obviously, isn‘t the same thing as repealing.  So, why the change?  We still don‘t know.  But eagle-eyed bloggers using Web site version tracking software spotted the shift on the White House Web site.  They spent the last few days squawking about it and asking questions, and now, apparently, it has been changed again.

The new version on the White House Web site adds back in the word “repeal” and it keeps the language about the sensible way strengthening stuff.  Behold the power of the pajama-clad, cheeto-eating, Twittering—blogging hordes.  We are legion.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

FMR. GOV. JEB BUSH, ® FLORIDA:  From the conservative time, it‘s time for us to listen first, to learn a little bit, to upgrade our message a little bit, to not be nostalgic about the past because, you know, things do ebb and flow.

(END VIDEO CLIP)

MADDOW:  There was something nice about listening to him talk with the words “Sunday” and “Souffle” over his shoulder.  It‘s relaxing.  Because Jeb Bush‘s brother, the previous president, so unpopular by the time he left office, because the political fortunes of the Republican Party dropped alongside those of George W. Bush, the GOP in the last couple of years had reason to be hopeful about how they would do, what they‘d be able to accomplish once the political dead weight of Bush and Cheney were lifted off of them.

That said, so far, it hasn‘t worked out all that well.  They tried John McCain.  They tried Sarah Palin.  They tried Joe the plumber.  They are still trying Michael Steele.  They tried going counterintuitive or counter-something and proposing a spending freeze while every economist in the country riveted (ph) in psychic pain and yelled, no!

They tried proposing a massive new tax cut for rich people.  They tried denouncing the president of the United States as a commie.  They held tax coast to coast protests on Tax Day, celebrating a strange and wonderful new mascot, the tea bag.  In other words, they have tried a lot.

But before this weekend, they had not yet tried a pizza party.  The new post-Obama Republican re-launch effort, the National Council for a New America, had its kickoff event this weekend at Pie-tanza.  Pie-tanza is a pizza parlor in a mall in Arlington, Virginia.

The announced purpose of the event was a thoughtful dialogue with the American people.  Nothing says new Republican Party that‘s not at all like the old Republican Party, like President Bush‘s brother and the second runner up in the Republican primaries, and the House minority whip.  Jeb Bush, Mitt Romney and Eric Cantor were the headliners at the “GOPizza Party.”

And to be fair, Mr. Cantor, who took the lead in forming the group, says it officially is a nonpartisan thing.

(BEGIN VIDEO CLIP)

REP. ERIC CANTOR, ® HOUSE MINORITY WHIP:  The National Council for a New America is a wide-open policy debate and we‘re going to be talking about things economic, things education, health care.  These are discussions that need to occur with the American people of any political stripe.

(END VIDEO CLIP)

MADDOW:  Any political stripe except the group doesn‘t include a single Democrat and will be operated out of Congressman Cantor‘s office, which also has the responsibility of transforming the Republican minority in the House of Representatives in one, giant, unanimous “no” vote.

One high note from the weekend gathering, apparently the pizza itself at Pie-tanza was awesome.

Joining us now is Christopher Beam, political reporter with Slate.com, who attended the “GOPizza Party” and who wrote about it on Slate.

Christopher, thanks very much for joining us.

CHRISTOPHER BEAM, SLATE.COM:  Thanks for having me.

MADDOW:  Can you give me a sense of the overall vibe?  Was there a sense of excitement?  A sense of enthusiasm?

BEAM:  I wouldn‘t say excitement, it was a Saturday morning.  And people were getting up to eat pizza before lunch.  But I would say that there was a lot of sort of hunger for new ideas, like they said.  The problem is that if you look at the questions that were asked and the solutions that were offered, I wouldn‘t exactly say they were new ideas.

Someone asked about, you know, how is the Republican Party going to help small businesses?  And you‘ll be shocked to learn that they want to jump-start the economy and cut taxes for business.

MADDOW:  Right.  Which is, conveniently enough, the always the right answer on every multiple-choice question—on every multiple-choice question no matter what the question is about.

I‘m not usually one to quote talk show host Rush Limbaugh, but on this subject, his views seem relevant.  Mr. Limbaugh today blasted the whole “rebranding the GOP” idea, saying that you can‘t make the same old politicians, the same old party look new.

This weekend, were Eric Cantor and Mitt Romney and Jeb Bush trying to represent themselves as if they were new to the party—as if they represented something different?

BEAM:  No, I think they acknowledged that they‘ve been around.  I mean, Romney referred to himself and Bush as two has-beens.  And, you know, Bush acknowledged—in fact, Bush sort of used that to his advantage.  He said, “You know, I‘ve been around long enough to see conservatives go up and down, I‘ve seen liberals go up and down,” it was sort of this reassurance that they will one day be back on top.

I think they appreciate the irony that they are these familiar faces, selling themselves as the future of the party.  But at the same time, have you to acknowledge that if they didn‘t have Romney there, if they didn‘t have McCain there, people wouldn‘t have shown up and we probably wouldn‘t be talking about it.

MADDOW:  Well, I don‘t know.  It‘s Pie-tanza.  I mean .

BEAM:  That‘s true.

MADDOW:  The elephant in the living room here for Jeb Bush talking about the future of the Republican Party and even for his admissions that things ebb and flow and that you see things sort of rise and fall in American politics, the elephant in the living room here is, of course, how his brother‘s presidency left the GOP.  Is that—is he talking about that now?  Was he willing to discuss the sort of the wreckage of the Republican Party in the wake of the two Bush terms?

BEAM:  Absolutely not.  I mean, any reference to the past, they will say—you know, they‘ll sort of echo Obama and say, “We‘re not here to talk about the past, we‘re here to talk about solutions for the future.”  Bush‘s whole strategy of bringing out the base and emphasizing social issues they‘ve totally scrapped.  They‘re not touching immigration; they‘re not touching abortion or gay marriage.

So, in some ways, it‘s almost like Specter‘s defection and these other signs that, you know, their abysmal approval rating—it almost seems to be registering.  They understand that they need to take another tack, and harping on the same social issues that got George W. Bush into office, I think they recognize it isn‘t going to work this time around.

MADDOW:  Christopher, one of the things that has been emerging recently in Republican Party politics is something that we saw from one of the Republican candidates for governor in Georgia in the past week—John Oxendine is now going to run on state right‘s sovereignty platform.  We‘ve seen the same thing happened in the Republican Party in Texas; secession is even polling well among Republicans in states like Georgia and Texas.

Are the Cantors and the Romneys and the Bushes engaging at all with this real, hard-edged, radical right-wing stuff that has been happening within the party—the kind of thing that we saw on a lot of the signs at the tea party events for example?

BEAM:  No, they‘re definitely distancing themselves.  I think they recognize that there is this split.  There‘s the “we-screwed-up” side of the Republican Party that thinks that they have to moderate.  And then there‘s the sort of “buckle down, in the trenches, we weren‘t conservative enough” in 2008 side.

And this group, the pizza party group, the NCNA, they‘re the “we-screwed-up” wing.  They‘re the ones who want to sort of reach out to moderates and at least rhetorically say, “We want to be inclusive” as opposed to—say, Rush Limbaugh, who says that it‘s a good thing that Specter left the party because now we have a much more pure Republican Party.  They don‘t seem to appreciate that we have these things called general elections in this country where more than just Republicans vote.

So, the purity of the party has no bearing on whether they‘re going to start winning or not.

MADDOW:  Christopher Beam, political reporter with “Slate” magazine—thanks for your time and your insight tonight.  Nice to have you on the show.

BEAM:  Thanks for having me.

MADDOW:  In the hundred-something days since she left office, former Secretary of state Condoleezza Rice faced her toughest critic yet yesterday.  It was a fourth grader.  Will Bush administration officials like Dr. Rice ultimately be held accountable by people their own age?  That‘s coming up.

Plus, yet another Friday night news dump from the Obama a administration.  This is becoming a bad habit already.

(COMMERCIAL BREAK)

MADDOW:  Coming up: A fourth grader gets in Condoleezza Rice‘s grill about her role in the Bush administration‘s torture policy.  Former Secretary Rice is in face-saving mode, and our friend Andrea Mitchell has the latest developments from Dr. Rice‘s “I did no such thing” tour.

But first, it‘s time for a couple of holy mackerel stories in today‘s news.

In our THE RACHEL MADDOW SHOW office, we have started referring to Friday as “Sprain the Constitution Day,” because if it‘s Friday night, when no one is paying attention to the news, it must be time for another softly, softly, very quiet, very Bush-ish Obama administration announcement.

Late in the day this past Friday, the administration leaked word to “The New York Times” that it may restart the Bush era military tribunals at Guantanamo.  Obama suspended the legalese-stamped tribunal system there immediately upon taking office in January.  And while suspending the trials, he also called for a review of all 200-something Guantanamo prisoner cases.  That review was supposed to end later this month, but the administration may ask for a three-month extension.

In addition, an unnamed source from the administration is raising the prospect that the tribunals themselves might be restarted, quote, “The more they look at it, the more the commissions don‘t look as bad as they did on the January 20th.”  Of course, the use of the word “they” implies that the leaker is not someone actually making the decision about the Guantanamo tribunals, which raises the question of why “The New York Times” is using that person as their anonymous source for this story.

Still, though, even if this is a just baseless, strategic leak, it‘s worth knowing just what exactly the administration is planning to do about those discredited tribunals, and it‘s not worth knowing whether they are planning on making a habit of this Friday night news dump thing.  I, for one, object.

Next up: Imagine a synergy of news stories.  Imagine two disparate,

distinct stories existing in completely separate areas of your mind until -

until one weekend news cycle when they converge like the Mississippi and Ohio rivers coming together in Cairo, Illinois.

               

OK.  First, you have the Kentucky Derby held this past weekend in Louisville.  The race is just one and a quarter miles, lasts just two minutes, and offers a great opportunity, excuse some might say, to drink mint juleps. 

Kentucky Derby on one hand.  Then you have former Alaska Senator Ted Stevens on the other.  Ted Stevens lost his reelection bid last year while on trial for corruption.  Federal prosecutors accused Stevens of accepting gifts like home renovations, a massage chair and a dog from Alaska businessman Bill Allen. 

Mr. Allen pled guilty to bribery.  Part of his plea deal was immunity for his son who was caught up in the same scandal.  And here is where things get really interesting.  Bill Allen‘s son, the one who got immunity, thanks to his dad going to prison, is co-owner of the winner of the Kentucky Derby, a 50 to 1 long shot named “Mine that Bird.” 

Mr. Allen purchased the horse for $400,000 with money earned from the sale of his dad‘s oil business.  Which means the Venn diagram between the amazing down-the-home stretch Kentucky Derby underdog win and Ted Stevens allegedly being bribed with a dog is complete. 

(COMMERCIAL BREAK)

MADDOW:  If you are a former senior administration official, here‘s maybe your first hint that the administration you served is going to afford you a very different post-Washington life than other administrations did.  Dr. Condoleezza Rice, four months ago, was the secretary of state.  Now, she‘s finding that she can‘t even visit an elementary school without some fourth grader grilling her on torture. 

Here was Dr. Rice‘s response to a question from a fourth grader about torture.  The fourth grader in question is named Misha Lerner(ph).  I should say incidentally I‘m now nominating Misha for a White House press pass. 

(BEGIN VIDEO CLIP)

CONDOLEEZZA RICE, FORMER SECRETARY OF STATE:  Now, let me say this.  President Bush was very clear that he wanted to do everything he could to protect the country.  After September 11th, we wanted to protect the country.  But he was also very clear that we would do nothing, nothing that was against the law or against our obligations internationally. 

(END VIDEO CLIP)

MADDOW:  Of course the elementary school episode was a sequel to last week‘s college edition of the great Condoleezza Rice torture quiz tour in which the former secretary of state had a testy back-and-forth with a Stanford undergrad. 

During that exchange, Dr. Rice appeared to make the Richard Nixon “if the president does it, it‘s not illegal” argument. 

(BEGIN VIDEO CLIP)

RICE:  The United States was told - we were told nothing that violates our obligations under the convention against torture.  And so by definition, if it was authorized by the president, it did not violate our obligations under the convention against torture.  

(END VIDEO CLIP)

MADDOW:  By definition, it couldn‘t have been illegal.  Here‘s the allusion she was perhaps unknowingly making. 

(BEGIN VIDEO CLIP)

RICHARD NIXON, FORMER UNITED STATES PRESIDENT:  Well, when the president does it, that means that it is not illegal. 

DAVID FROST, BRITISH JOURNALIST:  By definition? 

NIXON:  Exactly.  

(END VIDEO CLIP)

MADDOW:  Since the Stanford tape was made public last week, there has been a fairly remarkable chain of events concerning Condoleezza Rice and torture.  Members of Congress requested the declassification of a memo contesting the authorization of torture that was reportedly written by her deputy Philip Zelikow. 

As I mentioned also, a fourth grader grilled her on the subject at a D.C. area elementary school on camera.  Also her former colleagues John Ashcroft and Alberto Gonzales stated in an interview with NBC‘s Dan Abrams at the American Jewish University that they disagreed with the Nixonian contention that a president‘s actions are by definition legal.  And Dr. Rice herself started to defend herself and backtrack on her earlier comments publicly. 

(BEGIN VIDEO CLIP)

RICE:  This was not a Nixon-Frost moment.  All right?  What I intended to say or what I meant to say about this is the president said, “I won‘t authorize anything that is illegal.  It‘s not that because he authorized it, it was legal. 

(END VIDEO CLIP)

MADDOW:  So the new clarified story is that President Bush chose not to authorize anything that was illegal, which still leaves us wondering if the Bush administration thinks the president could authorize an illegal act if he wanted to. 

Someone needs to call that fourth grader to do a follow up.  Meanwhile, beyond the orbit of Condoleezza Rice, Sen. Patrick Leahy, chair of the Judiciary Committee, made another push for investigation of the Bush-era torture program in a “Boston Globe” op-ed this weekend.  And NBC‘s Kelly O‘Donnell is reporting that some senior House Democrats are thinking about going after Bush officials for lying to Congress about the torture program, even if they aren‘t pursued for torture itself. 

NBC news chief foreign affairs correspondent Andrea Mitchell has been covering the story.  She joins us live now.  Andrea, thank you so much for coming on the show tonight.  

ANDREA MITCHELL, NBC NEWS CHIEF FOREIGN AFFAIRS CORRESPONDENT:  My pleasure.  Good to see you, Rachel.  

MADDOW:  You, too.  Let‘s start with this idea that some congressional Democrats might try to investigate whether the Bush administration officials lied under oath about torture.  Are you able to shed any light on who these Democrats might be, who their targets might be? 

MITCHELL:  Well, John Conyers - and you already alluded to the fact that they have sent a memo or a request to Hillary Clinton to declassify those memos, the Zelikow memos.  Zelikow, famously, was against all of this.  And what they want to know is who in the room that he was describing were actually in favor of this, were advocating for it.  And that can‘t be good news for the people from the Bush White House.  

MADDOW:  Would a strategy like that fall under the rubric of going after the cover-up instead of the crime itself?  Or would that just be trying place the various characters in this drama accurately next to the stance they were taking at the time? 

MITCHELL:  Well, it‘s hard to say whether it would be a cover-up, but they certainly want to get back to who said what, when and who is favoring it, and whether there is a crime or not.  Very hard to prove crimes when you‘re talking about things that people are doing.  They can say, “Well, we believe this was the case,” or “We thought that this was the law and we were wrong.” 

So to actually prove - and Eric Holder has said this - others have suggested that it is very hard to actually prove a crime.  That said, there may have been some crimes committed.  But they certainly want to establish a record. 

And that‘s what Pat Leahy wants and that‘s what others in Congress want and that is actually what Dianne Feinstein is doing behind closed doors already with the Senate Intelligence Committee investigation that she is running.  

MADDOW:  Andrea, on the issue of Condoleezza Rice and this fourth grader remarkably in D.C. yesterday asking her about torture, this little boy named Misha Lerner(ph).  Apparently, he wanted to ask an even tougher question of Secretary Rice but he was told he should soften it? 

MITCHELL:  Well, this was not anything that we should point out that Condoleezza Rice was controlling. 

MADDOW:  Right.

MITCHELL:  She was open to all of the questions.  It started off with very easy questions for her about her previous work in the Bush years, and then Misha Lerner(ph) asked a question which he had worked on with his teachers. 

So when his mom who told “The Washington Post” that the teachers wanted him to soften and not presumably use the term “torture,” but he got to the same point.  And what an experience he had.  And to give her credit, Condoleezza Rice then, because he had missed the photo with her, posed for him and that is the picture we see in today‘s “Washington Post.”  So she was very gracious about being asked these questions by a fourth grader. 

And you‘re right, the White House press corps could use - or any press corps, any of us who have asked questions and not always asked it the correct way or gotten the answers we want should really take a lesson from Misha.  

MADDOW:  Last week, at Stanford, Secretary Rice said, “By definition, if it was authorized by the president, it did not violate our obligations under the convention.”  Now, she‘s backing away from that, issuing this clarification yesterday. 

But as I alluded to in the introduction, the clarification to me is still a bit muddy.  I know you spent so much time with her and reporting on her over the years.  Is this out on of character for someone accustomed to having every word on the record, every word parsed? 

MITCHELL:  Well, I think she‘s caught in a firestorm.  And clearly, at Stanford, she was not expecting those questions in a hall way.  You saw the video that had been posted from the newspaper at Stanford.  And I think she was caught off guard and clearly misspoke. 

I don‘t think that she, in a clear-cut way, would have prepared to answer in what is clearly an echo of what Richard Nixon said to David Frost.  So that is why she came back and said this was not a Frost-Nixon moment.  And I think she‘s trying to clarify that she was not in that corner. 

Now, what is even more confusing is when she said she didn‘t authorize the CIA to go ahead with the waterboarding, that she was just relaying information.  So basically what Condi Rice and others are trying to do, Phil Zelikow who was very close - co-authored a book with her, what they‘re trying to do is point to the Justice Department, point to that Office of Legal Counsel. 

And similar it‘s similar to the way the Bush White House used to point their finger, you know, at the CIA.  So it is an attempt to deflect it all back to the Justice Department lawyers who are - three lawyers, who, as you know, are under investigation.  

MADDOW:  Andrea Mitchell, NBC‘s chief foreign affairs correspondent, it‘s always great to have you on the show.  Thanks for being here, Andrea.  

MITCHELL:  Thank you, Rachel. 

MADDOW:  The Republican Party is several rounds into a big brawl with President Obama‘s Supreme Court nominee who doesn‘t exist.  Coming up next, meet the new senior Republican senator on the filibuster - I mean Judiciary Committee.  He is a doozy.  That‘s coming up.    

(COMMERCIAL BREAK)

MADDOW:  Did you see the fight this weekend?  A knock-down, drag-out pier six donnybrook?  Doing the brawling?  Republicans.  They‘re opponent?  President Obama‘s nonexistent nominee to the Supreme Court.  Republicans have unloaded on the nonexistent nominee with shots ranging from “too empathetic” to “too liberal” to “too activist.” 

Remember, this person doesn‘t exist.  So far, I think the nonexistent opponent is actually getting the best of the fight.  Meanwhile, into the fray enters Arlen Specter‘s replacement as ranking Republican on the crucial Senate Judiciary Committee.  He is Alabama Sen. Jefferson Beauregard Sessions III. 

Before he was Sen. Sessions, plain old Jeff Sessions had his own nomination to be a judge on the U.S. District Court in Alabama blocked by the Judiciary Committee back in 1986.  It seems that Mr. Sessions had made his bones as a U.S. attorney prosecuting African-Americans for voter fraud. 

He in fact unsuccessfully tried to prosecute a former aide to Martin Luther King Jr. for voter fraud.  That probably would not have been enough for the Senate to reject his nomination until an African-American assistant U.S. attorney in Alabama testified that Mr. Sessions called him “boy” and warned him about the way he spoke to white people. 

A career Justice Department official also testified saying Sessions had called the NAACP, quote, “un-American and communist-inspired.”  Here‘s what not-yet senator, never-going-to-be-judge Sessions said at the time. 

(BEGIN VIDEO CLIP)

SEN. JEFF SESSIONS (R-AL):  These comments that you could say about a commie organization or something - I may have said something like that in a general way and that probably was wrong. 

(END VIDEO CLIP)

MADDOW:  That probably was wrong.  Here‘s what then and still Sen. Ted Kennedy said at the time. 

(BEGIN VIDEO CLIP)

SEN. TED KENNEDY (D-MA):  Mr. Sessions is a throw back to a shameful era which I know both white and black Americans thought was in our past.  It‘s inconceivable to me that a person of this attitude is qualified to be a U.S. attorney, let alone a United States federal judge.  

(END VIDEO CLIP)

MADDOW:  The Justice Department employee who testified against Mr.  Sessions also testified that Sessions called a white civil rights lawyer a, quote, “disgrace to his race” for litigating voter rights cases on behalf of African-American clients. 

A disgrace to his race.  Mr. Sessions says he was just joking.  The Senate ultimately rejected Sessions‘ nomination to be a judge.  But 23 years later, Jeff Sessions is a senator and set to become the ranking member of that committee that rejected him - set to become the ranking member of the committee as it makes the most critical decisions on President Obama‘s first choice for the Supreme Court. 

Joining us now is my friend, Steve Benen, who writes for “Washington Monthly.”  Steve, thanks so much for joining us. 

STEVE BENEN, “WASHINGTON MONTHLY”:  Thank you.  It‘s good to be here.

MADDOW:  So by putting Sessions in this position, I have to ask if you think Republicans are sort of reinforcing the wildly out-of-touch, not-of-this-era image? 

BENEN:  Absolutely.  You know, you‘d like to think this is behind them, especially after the 2002 and 2003 incident with Trent Lott, which is a terrible embarrassment to the party that ultimately lead to a shake-up in the party leadership.  I think the party had hoped that all of this was behind them, that Jesse Helms was gone.  Strom Thurmond was gone.  Trent Lott was gone. 

But now, we have Jeff Sessions, who, as you just noted, is just as much as - just as bad as them, if not even worse at some instances.  And now, he‘s going to be the face of the party on the Judiciary Committee.  It raises all kinds of political problems for the party.  And this is a party that least can afford more problems like this right now.  

MADDOW:  Steve, it seems to me that if this had happened through some sort of accident of seniority, it would be sort of another bad day for the Republicans.  It would be something that was sort of bad luck in terms of the arcane rules of the Senate.  But because of the specific circumstances around Arlen Specter switching parties and the way that this position of seniority became available, what‘s remarkable to me here is that conservative bloggers pushed for Jeff Sessions to have this spot. 

What is it about him that appeals to the right wing of the Republican Party and the conservative movement? 

BENEN:  Well, when you look at the members of the Republican leaders in this committee, he is by far the most right-wing for all of the reasons we just talked about.  And I think we saw a number of right-wing bloggers and talk radio and others pushing for him to take this leadership role precisely because of his ideology again reinforcing the problems with the party, in the midst of this re-branding effort trying to decide whether the far right wing really dictates the direction of the party. 

And ultimately, in this case, we see that they do because here he is taking this leadership role at least in the next year and a half. 

MADDOW:  And in a year and a half, they will be - they‘ll be switcheroo-ing again at this point.  But we know for a fact that he will be the ranking Republican during the consideration of the Supreme Court nominee. 

Steve, Sen. Sessions told reporters today that senators shouldn‘t filibuster judicial nominees unless there were extraordinary circumstances.  But then, he said if there are problems, they should be aired.  What do we know about his record on the handling of Supreme Court nominees, obviously as a rejected judicial nominee himself?  He‘s got sort of a complicated record here. 

BENEN:  He does.  But I think to a certain extent during the Bush years, he was quite consistent.  He suggested that any filibustering of any judicial nominee, especially Supreme Court nominees, not only was wrong, not only was offensive to him, but tore at the very fabric of democracy.  The worst possible thing a senator could do would be to filibuster a judicial nominee. 

And so if he wants to try and change direction now and suggest that Obama nominees might be subject to the same kind of scrutiny, then he‘d have to kind of engage in some kind of rhetorical acrobatics that I don‘t think he could pull off.  So he‘s in a difficult position right now.  And I think that he‘s going to have to kind of walk that line very carefully.  

MADDOW:  I don‘t know.  It seems to me very clear that Democratic filibusters tear at the fabric of democracy and Republican filibusters, you know, make everybody happy.  That‘s the way that goes. 

In terms of him having of this leadership role on the Judiciary Committee the next year and a half, presumably, Sessions will make that committee run very differently than having the senior Republican on that committee be Arlen Specter, right? 

BENEN:  I think that is fair to say.  You know, obviously, Specter is probably one of the most moderate members of the Senate, certainly the most moderate Republican on the committee.  Jeff Sessions, for all the reasons we have talked about, is far to the right and he will be the public face. 

You know, you talked earlier in the show about the re-branding effort.  It undermines the re-branding when you someone with these deep and ugly racial problems dating back a couple of decades.  And now, he‘ll be the public face of the Judiciary Committee, not only with judicial nominations but also on issues like civil rights laws that automatically go to the Judiciary Committee.  So, this is a problem for the party.  It‘s a problem for the committee and I‘m anxious to see how it turns out for them.  

MADDOW:  I‘m anxious to hear him explain yet again how the “disgrace to his race” comment was a joke.  That will be great. 

BENEN:  Yes.

MADDOW:  “Washington Monthly” Steve Benen - thank you so much, Steve. 

It‘s nice to see you. 

BENEN:  Thank you.  Good to see you.  

MADDOW:  All right.  Coming up on “COUNTDOWN,” so much for Republican money woes.  The ex-president, George W. Bush raises $1 million a day for his library. 

And next on this show, if that news makes you really, really angry, my friend Kent Jones might know why. 

(COMMERCIAL BREAK)

KENT JONES, POP CULTURIST:  Hey there …

MADDOW:  Hi, Kent. 

JONES:  … dancer.

MADDOW:  How are you? 

JONES:  I‘m good. 

MADDOW:  What have you got?

JONES:  We have an important scientific discovery about anger.  Take a look.  

MADDOW:  Oh, OK.  

(BEGIN VIDEO CLIP)

JONES (voice-over):  What‘s the difference between this and this?  It may be genetic.  Researchers in Germany have isolated a gene linked to anger. 

BILL O‘REILLY, HOST, “THE O‘REILLY FACTOR”:  We‘ll do it live! 

(EXPLETIVE DELETED) it.

JONES:  It turns out, you may have inherited more from your parents than just eye color.  Scientists found three versions of a gene called DARPP32.  People with the so-called TT or TC versions of this gene were significantly more angry, while those with the CC version were the mellow, cool people. 

The study also found that the angry types had less gray matter in the amygdala, the part of the brain that helps keep our emotions in check.  Less gray matter - that explains so much.  But scientists say genetics only account for about half of our disposition towards anger - half.  Said one researcher, there are no excuses for bad behavior. 

UNIDENTIFIED MALE:  You cannot be serious! 

WHITNEY HOUSTON, SINGER:  Kiss my (EXPLETIVE DELETED)!

O‘REILLY:  This (EXPLETIVE DELETED) sucks!

(END VIDEO CLIP)

MADDOW:  Oh, Kent.

JONES:  Some of it is genetic.  

MADDOW:  I feel like it.  I have been cathartically released just by watching that.  

JONES:  It‘s all good.  Breathe, breathe. 

MADDOW:  All right, Kent.  I have a cocktail moment for you.  

JONES:  Ah, that‘s relaxing, too.  

MADDOW:  Yes, it‘s very relaxing.  That‘s the whole point of the cocktail moment when you come to think of it.  Big Cinco de Mayo event at White House today.  

JONES:  Yes, even though that‘s tomorrow.  

MADDOW:  Yes.  Well, that‘s the thing -

JONES:  Yes.  

MADDOW:  We‘ve got President Obama at the Cinco de Mayo event at the White House.  And then, Michelle Obama - she went to a Cinco de Mayo event at the Latin American Montessori bilingual public charter school in northwest Washington, D.C.  Lots of happy dancing and clapping.  

JONES:  Excellent.  

MADDOW:  It does make me worry the Obama era is so forward-thinking we have to celebrate Quattro de Mayo. 

JONES:  Is progressive.  

MADDOW:  Thank you, Kent.  Thank you for watching at home tonight.  We‘ll see you again tomorrow night.  “COUNTDOWN” with Keith Olbermann starts now.  . 

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

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