The Rachel Maddow Show, Transcript 08/01/12

Guests:
James Roosevelt, Jr., Barney Frank
Transcript:


MICHAEL ERIC DYSON, MSNBC CONTRIBUTOR: Rachel, do you love good fried
chicken as well?

RACHEL MADDOW, HOST: What I was going to tell you is you have to
remind me at some point to tell you the story of the first time I took my
girlfriend Susan to a Popeye`s and she thought it was called Pope yes.

(LAUGHTER)

DYSON: That`s because the Pope digs the stuff, too. And like
Beyonce, he wants to put a ring on it.

MADDOW: Well done. Thank you. Good to see you guys.

We`re just that Catholic. It overrides everything else.

All right. President Obama spent the full day today campaigning in
the great state of Ohio. The great swing state of Ohio, not incidentally.
While he was there today, Mr. Obama unveiled what looks to be a new phase -
- a new really pointed attack on his opponent this November, Mitt Romney.
Watch.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The centerpiece of my
opponent`s entire economic plan is not only to extend the Bush tax cuts,
but then to add a new $5 trillion tax cut on top of it.

(BOOS)

OBAMA: The bulk of this would go to the wealthiest Americans. What
this means is the average, middle-class family with children would be hit
with a tax increase of more than $2,000.

Let me make sure people understand this. They`re asking you to pay an
extra $2,000, not to pay down the deficit, not to invest in our kids`
education. Mr. Romney is asking you to pay more so that people like him
get a tax cut.

(BOOS)

(END VIDEO CLIP)

MADDOW: He`s asking you to pay an extra 2 grand so people like him
can get a tax cut. He`s doing it for himself.

This is a pointed new development in the campaign. It hits on two
important things. Everybody keeps saying the Republicans want to run on
the economy and the Democrats want to run on something else.

I think the Democrats want to run on the economy, too. The two things
they`re hitting on is this, one is the economic plan that Mr. Romney is
proposing. Brand new analysis out that does echo consistent analysis all
along shows that what Mr. Romney is offering, which is what congressional
Republicans are offering as well, is in effect a package of huge economic
benefits for the wealthiest Americans, one that would make things harder
economically for the vast majority of people, for the middle class. That
sort of tax plan.

That sort of an anti-populist economic plan that is bad for most
people but good for the rich people – I mean, that could be a political
liability even in the best of times, but in the worst of times where the
only people doing well are the wealthy, being able to describe a
candidate`s tax plan like that is essentially a political sieve you can use
against them.

The twist to that knife right now is the personal part of it. This is
to new development in this part of the campaign. Beyond the question of
whether Mr. Romney`s proposals will help wealthy people like him
essentially as a class.

There is also now the specific personal question of how much his
economic plan would help him – him, Mitt Romney as an individual, someone
who lives, we all know now, in a sort of different tax universe than most
of the rest of us.

(BEGIN VIDEO CLIP)

REPORTER: We know that there was one year when you paid about a 13.9
percent tax rate. Can we clear this up by asking you a simple yes or no
question? Was there ever any year when you paid lower than the 13.9
percent?

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: Well, I haven`t calculated
that. I`m happy to go back and look.

(END VIDEO CLIP)

MADDOW: Happy to go back and look. That was this past Sunday on ABC.
There has will been no word from Mr. Romney on whether he went back and
looked.

(BEGIN VIDEO CLIP)

REPORTER: ABC News reached out to the campaign today after Romney`s
answer. A spokesperson would only reiterate, “Mitt Romney has paid his
taxes in full compliance with U.S. law and has paid 100 percent of what he
has owed.”

(END VIDEO CLIP)

MADDOW: So, still no answer. That was Monday on ABC.

Two days later on Wednesday, Mr. Romney still apparently has not given
them the information that he said he was going to give them. Remember,
when he said he was happy to go back and look, the question he was asked
was whether he ever paid less than the 13.9 percent tax rate we know he
paid in the one year for which he has released tax returns.

Here`s the weird thing, though. This – I`ll go back and look, and
then not actually going back and looking – this exact same thing happened
to Mitt Romney a decade ago, 10 years ago. Asked by “The Boston Globe”
when he was running for governor of Massachusetts about why he listed
himself as a Utah resident and not a Massachusetts resident on his taxes,
Mr. Romney told “The Globe” 10 years ago, just like he told ABC this week,
that he would look into it, he would find out what is in his taxes and he
would get back to them on it.

Quoting from “The Globe”, “Asked whether he received any advantages in
Utah by filing as a full-time resident there in 1999 and 2000, `Mr. Romney
said he was not sure but would respond to specific questions in writing.
If you want to say was there any tax benefit anywhere, you ought to help me
understand what that would mean and I would be happy to look at it,` Mr.
Romney said. `I will get precisely the answer that you`d like and but have
to tell me exactly what you want and I`ll make sure I get that for you.`”

Still quoting from “The Globe” here, “But after a reporter submitted
written questions to a campaign aide, Mr. Romney spokesman, Eric Fehrnstrom
said Mr. Romney would not be responding because, quote, `he values his
privacy and his wife`s privacy.`”

What “The Boston Globe was trying to get to there 10 years ago was
whether or not Mitt Romney was qualified to be the governor of
Massachusetts. Not in some abstract political sense but literally
qualified. Whether he met the written qualifications that you have to meet
in order to be allowed to run for governor of Massachusetts.

Massachusetts has the oldest functioning written constitution in the
entire world. And dating back to the colonial era, the law in
Massachusetts says that you have to be a continuous inhabitant of
Massachusetts for the seven years immediately prior to you running for
governor or you cannot run for governor.

In 2002, when Mitt Romney moved back to Massachusetts from Utah, to
run for governor in Massachusetts, that residency requirement was a big
problem for him. He maintained publicly until June of that year when he
was running he had always paid taxes as a Massachusetts resident. So, this
residency requirement was going to be no problem. Clearly he met the
residency requirement. He`d been paying Massachusetts resident taxes.
That`s what he said all along.

But that June, that year he was running, June 2002, under pressure
from the Democrats in the state and under scrutiny from the Boston press,
that story fell apart because it turns out he had not been paying taxes as
a Massachusetts resident like he said he did. He had not been paying taxes
as a Massachusetts resident. He had been paying taxes as a Utah resident.

Mr. Romney had said that wasn`t the case, but high got caught. After
he got caught, he admitted, yes, OK, he`d been filing as a Utah resident,
but he was retroactively, now that he was running for governor, now going
back a few years and he was going to change that. Retroactively, but it
was a huge mess.

I mean, Mr. Romney had told a local newspaper reporter in Utah that he
had declared Utah his primary residence for tax purposes. He had claimed a
giant permanent resident of Utah tax credit on his big Utah house out
there. He saved $54,000 in taxes by doing that. He had signed multiple
years of tax returns as a part-time only or nonresident of Massachusetts.

But all of that, he said, how are you going to explain doing that? He
said it was all other people`s mistakes.

The reporter he talked to in 2000 who noted that Mr. Romney had
declared his Utah home his primary residence – well, Mr. Romney said that
must have been a mistake on the reporter`s part. Mr. Romney told the
Massachusetts state ballot commission, quote, “I have met with that
reporter at least 100 times over the last three years and I do not recall a
specific conversation about my residence in Utah.” That reporter got a
subpoena to appear in Massachusetts and testify as to whether or not Mr.
Romney told her that, and the paper resisted that subpoena.

In terms of the tax break that Mr. Romney got on his Utah house for
being a full-time resident of Utah, he blamed a clerk in the tax assessor`s
office in Utah saying he had never asked for that tax break. Somebody
accidentally gave it to him and accidentally saved him $54,000.

The county assessor ended up taking the heat for it, although she said
at the time such an error had never before occurred in her 12 years in
office.

What about all those tax returns for those multiple years that Mr.
Romney signed, saying he wasn`t a Massachusetts resident? Can`t blame that
on this reporter, can`t blame that on the clerk in the tax assessor`s
office. I mean, he signed these tax returns.

What`s his explanation for that one? His explanation was that he
never bothered to read that stuff he signed. Listen to this. “Mr. Romney
said he had always trusted his accountants and signed and dated the
returns. He said he did not notice that a line asking for his domicile was
left blank on his returns.” Quote, “I do not read those or review those
before I sign them nor their attached schedules.”

As you`re probably aware, your tax return is one of those things that
you submit. You sign and submit under the penalty of perjury. This is
something that was pointed out to Mr. Romney when he testified before the
Massachusetts state ballot commission to try to be allowed to run for
governor.

Quote, “If I were to hand you an affidavit, Mr. Romney, and at the end
of it I typed in your signature and above your signature, I put signed
under the pains and penalties of perjury and said sign it, you would read
it first, wouldn`t you?

Romney: `If you were to put it in front of me, yes.`

`So you would sign documents under the pains and penalties of perjury
without necessarily reading them, is that your testimony?`

Romney: `I have not read the entire Massachusetts tax form nor the
federal tax form, nor the Utah tax form, and all them have me sign under
pains of penalty to the best of my knowledge and belief. And I do not read
the entire form.`”

This was 10 years ago.

Ultimately, the residency challenge failed to keep Mr. Romney off the
ballot in Massachusetts. Democrats tried it, but it did not work.

But they were able to uncover about his tax history in trying to prove
he wasn`t really a Massachusetts resident, showed that what he said was in
his tax returns was not actually what was in his tax returns. Mr. Romney
maintained publicly for months that he was a Massachusetts resident and he
could prove it because he filed his taxes as a Massachusetts resident all
those years. That`s what he said was in his taxes. That was not what was
in his taxes.

And he seems to have known it at the time even as he was making public
claims to the contrary. When he finally got caught out in June of that
year, he admitted a few months earlier when he decided to run for governor,
earlier that spring, he had started the process of retroactively going back
and changing those returns.

Mr. Romney had not filed as a resident of Massachusetts. He said he
did, but he didn`t. He misled the public about it the whole time, and he
misled reporters who were trying to get to the truth about it.

Quote, “Earlier in the week, Mr. Romney rejected a request by `The
Boston Globe` for copies of his tax returns with financial information
redacted but his residential status visible. A Romney spokesman insisted
at the time the GOP candidate had filed his returns as a Massachusetts
resident but told `The Globe` reporter, `You`re going to have to take my
word for it.`”

“You`re going to have to take my word for it.” It`s really important
what is in the tax returns but I`m not going to show you. Trust me what`s
in them.

After the truth starting coming out, Mr. Romney said then to “The
Globe” – just like he`s saying to ABC now, he`ll get them the information
they wanted. Sure, sure, I`ll get you what you need. Even though he said
that to the reporter, he shut them down, just like he`s shutting down ABC
10 years later.

(BEGIN VIDEO CLIP)

REPORTER: ABC News reached out to the campaign after Romney`s answer.
A spokesperson would only reiterate, “Mitt Romney has paid his taxes in
full compliance with U.S. law and he has paid 100 percent of what he has
owed.”

(END VIDEO CLIP)

MADDOW: Trust me, you`re going to have to take my word for it, just
like trust me when I have always filed taxes as a Massachusetts resident
except for the years where you caught me not doing that, then I have to
retroactively go back and change them.

This is becoming a bigger issue, not a smaller issue in the campaign.
The new “New York Times” poll that came out of all of the swing states got
lots of attention because of the overall numbers showing President Obama
ahead of Mr. Romney in Pennsylvania and Ohio and Florida, these hotly
contested swing states right now.

And, honestly, that`s fine as far as August polling goes for a
November election, which is not very far. But look at this other thing
that was in the polls. Look at the responses to this question.

Asked if candidates should release multiple years of their tax
returns, the majority of voters in Florida, in Ohio, and in Pennsylvania,
all say presidential candidates should release several years of their tax
returns. Given the history here in Massachusetts, maybe especially Mitt
Romney should.

Joining us now is James Roosevelt, Jr. He`s the top lawyer for the
Massachusetts Democratic Party when Mr. Romney`s tax returns were part of
their challenge about whether or not Mr. Romney was a Massachusetts
resident or not.

Mr. Roosevelt, thank you for your time tonight. Thanks for being
here.

JAMES ROOSEVELT, ATTORNEY: Glad to be with you, Rachel.

MADDOW: This is not a very complicated story, but sort of a deep
story. A deep dive into what we know about Mr. Romney and his history both
as a citizen and in terms of his financial life. In terms of the way I
explained that history in Massachusetts, did I get any of that wrong as far
as you know?

ROOSEVELT: I think you got it right. And in trying to present this
case to the ballot law commission, we were trying to show exactly what he
had said under oath, signing as you point out under the pains and penalties
of perjury, not by the way as he characterized it, to the best of his
knowledge and belief, but under the pains and penalty of perjury. And we
had the tax assessor statements in Utah, we had the Utah resident tax
returns, the Massachusetts non-resident tax returns, and then we had his
attempt to retroactively rewrite his personal history.

MADDOW: He was trying to retroactively – essentially refile his
taxes so his Massachusetts taxes would be filed as if he were a resident of
the state. He was making that retroactive attempt while he was publicly
maintaining up until June of that year that he had filed as a Massachusetts
resident?

ROOSEVELT: That is true.

MADDOW: Wow. That seems to me to be the heart of the problem. What
is happening right now with the demands to see Mr. Romney`s tax returns,
both from the Democratic opposition but also from the press, is that his
answer has been to characterize what`s in them, and then say essentially
trust me. This is what`s in them. There`s nothing wrong in them. They
show everything to be perfectly legal, trust me on them.

As far as you`re concerned, and you still have a stake in this matter.
You`re still a Democratic Party activist in Massachusetts. Do you feel
like there`s an allegory between the trustworthiness and the questions now?

ROOSEVELT: Well, I think it fits with the pattern of trying to
rewrite what his beliefs are, what his positions on issues are, and with
trying to retroactively rewrite his personal history. And the interesting
thing was that in the ballot law commission hearing, we were trying to show
what we believed to be true, that he had changed his residence to Utah.

He was trying to show that he had maintained continuous ties with
Massachusetts while he was in Utah working on the Olympics. And that`s why
he testified about his continuing business interests in Massachusetts, his
continuing return to Massachusetts for board meetings that grew out of his
employment at Bain.

MADDOW: Looking through the transcripts today of his testimony before
the ballot law commission, which were voluminous and sort of mind-bending
by the end of the day, one of the things that becomes quite clear is when
he says he spent lots of time in Massachusetts, it`s on – a lot of it is
on business-related matters, serving on the board of the Staples
Corporation, which was involved in his time at Bain, serving on the board
of another corporation called the Lifelike Corporation, and some other
business interests that did not seem to be associated with Bain.

When there was this more recent controversy about whether or not he
should be seen as having been involved with Bain after he left to go run
the Olympics, did you see that evidence that he presented a decade ago as
being relevant to his case there?

ROOSEVELT: He was trying to show that he had family and social ties
back to Massachusetts. And really nobody was disputing that. The fact is
that he had been very clearly stating one thing about his life and he
started stating something else.

And that he did this, these statements that he then tried to change
later in a way – oddly enough, it was always in a way that saved him
taxes, whether it was property taxes where he declared himself to have a
principle residence in Utah, and in Massachusetts which got him a tax
benefit in both places, or income taxes.

MADDOW: James Roosevelt Jr., former top lawyer for the Massachusetts
Democratic Party, a current legal volunteer for the party in the state –
thank you very much for joining us tonight, sir. I really appreciate your
time on this.

ROOSEVELT: Nice to be with you.

MADDOW: Thank you.

As always, Mr. Romney, if you would like to talk with me about any of
this stuff, me casa es su casa. Anytime, we would love to have you.
Seriously.

Okay, more to come here. Including the Obama campaign officially
making an argument, President Obama approving a message that I think may
never have been made by a Democratic candidate running against a Republican
candidate in modern times. Common wisdom says what the Obama started doing
is risky, but Congressman Barney Frank will join us here to assess the
risks.

Stay with us.

(COMMERCIAL BREAK)

MADDOW: Hey, some legit big news in a story that we have been
covering in an ongoing way for months now. When the Iraq war ended in
December, some regular Joe civilians in St. Louis, Missouri, decided to
throw a parade for Iraq veterans to say welcome home. We missed you.
Thank you.

St. Louis`s parade to mark the end of the Iraq war was a huge success
– 100,000 people, universal acclaim. And frankly, it called the question
of whether we would as a country do what we did at the end of previous
wars, which is to welcome our veterans home with a parade at Broadway in
New York City. Like we did for wars from the Spanish-American War, through
the world wars, through Korea to the First Gulf War through the presidency
of the first George Bush.

Well, we did not do a parade in the 1970s to welcome home to troops
who fought in Vietnam as the Vietnam War ended. As a country, frankly, we
righted that wrong and honored Vietnam veterans years later in 1985. The
predominant sentiment at the time, then, as is now, that it was the right
thing to do to honor those Vietnam veterans with a parade at Broadway in
New York City. It`s just a shame it took so long to do it.

St. Louis in January of this year really called the question, are we
going to treat Iraq war veterans the way Vietnam veterans were initially
treated in this country? Why wouldn`t there be a welcome home and thank
you for them in New York which is frankly what we do as a country to mark
the end of the Iraq war?

The Pentagon somewhat inexplicably said they were against there being
a New York City ticker tape parade to mark the end of the Iraq war. I say
it was inexplicable because we had on the show a Pentagon spokesman here to
try to explain that point of view. And at the end of the interview, the
decision remained inexplicable to me. That spokesman, I should say, has
since retired from the Pentagon.

But the funny thing was, the Pentagon did not say that they object to
all parades to mark the end of the Iraq war and welcome home Iraq veterans.
In fact, the Pentagon says it likes the idea of doing that across the
country for Iraq veterans, except they just don`t want it in New York.

And in fact, cities across the country have kept doing it. Since the
St. Louis parade, there have been parades to mark the end of the Iraq war,
say welcome home, thank you to Iraq veterans in Houston, in Tucson, in
Fayetteville, North Carolina, in Melbourne, Florida, in Richmond, Virginia,
in Kansas, Missouri, in Portsmouth, New Hampshire, in Austin, Texas, and
then this weekend, there was another in the twin cities – Minneapolis and
St. Paul, Minnesota.

(BEGIN VIDEO CLIP)

ERICKA PALMER, PARADE ORGANIZER: And as an adult, I now have the
ability to stand up and do something for our community and for our military
members actually stop and say thank you and why not? Why not do that?

JAMES THOMPSON, VIETNAM VETERAN: I think that`s important right now.
People are finally recognizing that you need to welcome these veterans
home.

(END VIDEO CLIP)

MADDOW: The parade in the Twin Cities this past weekend to mark the
end of the Iraq war and welcome home Iraq war veterans seems to have been a
big success. The governor of Minnesota, Mark Dayton, issued a proclamation
declaring this past weekend in Minnesota to be heroes weekend.

Senator Amy Klobuchar was on the hand for the parade. Here she is
left with one of the event`s organizers, Ericka Palmer. To the left of the
senator, actually, the mayor of Minneapolis, R.T. Rybak.

We should mention that a couple vintage T-6 Thunders flew overhead at
the parade.

What we have just learned today and this is the big news, that the
biggest city yet to do this kind of thing has just made their plans to do
it. Chicago. The third largest city in the country after New York and
L.A., Chicago has just issued the permit for that city`s parade to mark the
end of the Iraq war, to say welcome home to the Americans who fought the
Iraq war, to say welcome home and thank you.

The Chicago parade permit is for December 15th. It`s designed to
coincide with the one-year anniversary of the end of the Iraq war. So,
mark your calendar, December 15th, 2012, Chicago, biggest one yet.

Honestly, that ought to be a national event if you ask me. It`s on
the one year anniversary of the end of the war. The Pentagon won`t give
their blessing to a parade in New York for some reason. And doing these
things longer than a year from the end of the war is starting to seem like
making the same mistakes as we made at the end of the Vietnam War again
starting to seem a little bit weird.

So, my personal opinion, but Chicago, December 15th, maybe the whole
country should go.

Now look at this. This is interesting and political terms. The Obama
campaign a few days ago posted online this web ad, this web video about
Iraq veterans coming home and about the parades. Watch.

(BEGIN VIDEO CLIP)

OBAMA: As your commander in chief, on behalf of a grateful nation,
I`m proud to finally say these two words, and I know your families agree –
welcome home. Welcome home. Welcome home.

UNIDENTIFIED MALE: Welcome back.

TOM APPELBAUM, PARADE CO-ORGANIZER: The welcome home parade was a
parade to celebrate the end of the Iraq war and to welcome hope the
veterans who had been serving the country since 9/11.

President Obama kept his promise, brought the troops home from Iraq,
and this was something that needed to be celebrated.

RICK ROSSOMANNO, VIETNAM WAR VETERAN: Being a veteran and being part
of a generation of veterans that wasn`t shown quite this kind of
recognition, it just absolutely touched my heart. I don`t know if I have
the words to describe it. It was incredible.

UNIDENTIFIED MALE: As these wars come to an end, we have an absolute
responsibility to cake care of our veterans.

OBAMA: At this time, I would ask all our Vietnam –

(END VIDEO CLIP)

MADDOW: The president`s campaign in this campaign video citing
specifically welcoming home the veterans a reason to vote for the
president`s re-election, and of course, also the president ending the war
in Iraq, campaigning on that. Maybe that means the president will be there
in Chicago in December. Maybe it`s time to talk to the Pentagon about
finally getting a parade in New York.

But beyond specifically the parades which I admit I`m a little hung up
on, beyond specifically the issue of the welcome home plans for veterans,
there is something even bigger going on in these politics and specifically
in what the Obama campaign is doing. You can see it even more clearly in
another brand new Obama campaign ad that`s just out.

This one isn`t one of these ones that ends up on the web, either.
This is a big, made for TV, expensive ad buy that is airing in a bunch of
swing states. This one, I actually think, is doing something historic.

(BEGIN VIDEO CLIP)

NARRATOR: You watched and worried. Two wars, tax cuts for
millionaires, debt piled up. And now we face a choice.

Mitt Romney`s plan, a new $250,000 tax cut for millionaires, increase
military spending, adding trillions to the deficit.

Or President Obama`s plan, a balanced approach, $4 trillion in deficit
reduction, millionaires pay a little more.

(END VIDEO CLIP)

MADDOW: Increase military spending, adding trillions to the deficit.
That`s on the little short list of things to feel bad about Mitt Romney,
right? If you want to follow the way this ad makes you want to feel.

This ad is taking on not just the legacy of the George W. Bush years,
but also Mitt Romney bragging, which he does on the stump regularly, that
he will increase defense spending, and hanging that on him about the
deficit.

In my lifetime, I have never seen a Democratic president play
political offense on the issue of military spending so aggressively. I
have never seen it. And that`s because the common wisdom for decades is
that kind of message is impossible. It cannot work. Democrats can not
criticize Republicans for wanting to spend too much on the military.

It can`t work. That`s the common wisdom and it has been since Reagan.
It`s changing now apparently – at least the Obama campaign thinks it is.
If they are right, that`s a historic change for us as a country and our
politics.

Barney Frank joins us next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

NARRATOR: Now, we face a choice.

Mitt Romney`s plan, a new $250,000 tax cut for millionaires, increase
military spending, adding trillions to the deficit.

OBAMA: As your commander in chief, and on behalf of a grateful
nation, I`m proud to finally say these two words, and I know your families
agree – welcome home. Welcome home. Welcome home.

(END VIDEO CLIP)

MADDOW: Joining us tonight now for the interview is Democratic
Congressman Barney Frank of Massachusetts, who has been a very vocal
proponent of at least being able to discuss the military budget as a thing
that operates on the same kinds of dollars that other things in our budget
operates on.

Congressman Frank, thank you very much for being with us. It`s nice
to see you.

REP. BARNEY FRANK (D), MASSACHUSETTS: Great to see you, and on this
topic which you have done such important work.

MADDOW: Thank you. Since the presidency – maybe not the presidency,
but the rise of Ronald Reagan, the common political wisdom is Democrats
can`t go after Republicans for being profligate on defense spending, but
that`s exactly what the Obama campaign is now doing.

I guess assuming times have changed enough to make this less risky.
Do you think times have changed enough?

FRANK: I do, and you`re exactly right. It is historic, and frankly,
the timeline is beyond that. Remember, John Kennedy, whom I generally
admired, ran against Richard Nixon on the grounds that the Republicans
hadn`t spent enough on defense, there had been a missile gap.

And for years, I know this, I have been involved in this, Democratic
candidates for president were told, your one vulnerability is if you`re
weak on defense. That`s why a really superb public servant, Michael
Dukakis, with great record, made the mistake of being in the tank, he was a
veteran, had a right to do it, but it didn`t look good. And he was told,
gee, you better show you`re tough.

I think what`s happened is this, Rachel. For 60 years, the American
public was focused on – 50 years, from 1940 to 1990, there were very bad
people who were heavily armed, first Hitler and then Stalin and his
successors, and they meant (INAUDIBLE). Now, I believe we did not see an
evolution in the Soviet Union early enough and we over-prepared for it, but
there was this fear that we were going to be attacked by somebody powerful.
That led to military spending that I think in some cases was excessive.

The Soviet Union collapses in 1990, and first, George H.W. Bush and
Bill Clinton begin to reduce the military because there was no longer this
existential threat to our citizens. And then what happens is 2001, the
mass murders of Americans, and Dick Cheney and the other neocons persuade
George Bush that they can use the threat of terrorism as the functional
political equivalent of communism. Now, in fact, the terrorists are
terrible people and I am very pleased against them.

But they`re not Hitler and they`re not Stalin. They don`t threaten
our existence as a country. They are threatening our lives. We have to
fight them back. But that threat was blown up beyond the reality.

So we got back into excessive military spending, including the two
wars.

I think what has happened is the American people understand there is
no power in the world that comes remotely close to threatening our
existence. They see how the Iraq war backfired. And accomplished almost
none of what it was supposed to except it did get rid of Saddam Hussein,
but the destabilization in the country we have created in Iraq, Iran`s
closest ally. They see the frustration in Afghanistan.

See, the American people – and then, finally we have the concern
about the deficit, and people I believe now in the majority understand,
yes, we must reduce the deficit. Yes, we have to include the military,
otherwise we devastate all of the programs that affect the quality of life
at home, and given the nature of the world, we can afford to do it. We are
significantly overspending.

And let just say one last thing, I know this is a little too long, but
one of the things that gave me hope, too, this is the first ad by a
Democratic president saying you`re spending too much on the military.

Two weeks ago, I teamed up with a Tea Party Republican, Mick Mulvaney
from South Carolina, and we offered an amendment in which the House voted
by a large majority to reduce the amount of money the appropriations
committee was going to give the military. That was only $1.3 billion. In
Pentagon, it wasn`t much, but it was still important.

And so I think, yes, the president sees this right. The people are
tired of this excess. They`re tired of getting sent into all parts of the
world where we do no good as much as we may be trying. They understand the
importance of trying to have a balanced approach. So, I`m glad he`s doing
that. It will be helpful politically and it`s accurate substantively.

MADDOW: You know, that point about working with Congressman Mulvaney
on the Republican side I think is really important and interesting. I was
thinking about it last night watching the Texas primary results. Watching
Texas Republicans pick someone to replace Ron Paul – he`s leaving
Congress, he`s stepping down from Congress.

And I was thinking about whether or not this thing, this dynamic you
and I have talked about a lot is ever going to materialize, this idea of
fiscal resistance on the Republican side to such increased military
spending.

Mitt Romney is still campaigning on spending more.

FRANK: And Romney I think is the outlier on this. A year ago, I
offered an amendment to cut the military and so did Mulvaney. What we
noticed was we both lost, but a lot of Democrats voted for my amendment
against his, he`s a Tea Party Republican, a lot of Republicans voted for
his and against mine.

So, we talked about it. I talked to him, and said, look, let`s get
together. So, we offered it jointly. The Democrats voted overwhelmingly,
better than 80 percent for the $1.3 billion cut. The interesting thing
with John McCain and Romney saying you`ve cut too much, you`ve got to spend
more, 89 of the 240 Republicans voted with us. That`s a very big chunk,
more than a third.

And the answer, yes, the American republic understands that. First,
they recognize that we are not threatened in our existence as a country.
Let me say three things. Secondly, they recognize that a lot of these
international adventures, even if they`re well-intentioned, don`t work
well.

You know, the best trained and best armed young Americans can`t get
people in Iraq to like each other when they have been hating each other for
a long time. They can`t end corruption in Afghanistan.

Our military is wonderful at doing what a military can do, stopping
bad things from happening. But they can`t make good things happen,
particularly in a culture that`s foreign to us.

And then they finally understand it`s a choice. If you expand the
military the way Mitt Romney wants to, then Medicare is going to take big
cuts. And then you can forget about local police officers.

And I think most of the people I represent are more worried about fire
and police and local threats than they are about some very far off ones.
And I would be morally conflicted if I thought we could accomplish some of
what we do when we intervene, generally, it ends badly for us because you
can`t send military force into these complex cultures and remake them.

MADDOW: The dynamic you`re talking about and that you have
consistently identified is one that really still doesn`t get much
attention. I almost feel like we should only have these conversations in
private because if we don`t point out they`re happening, maybe this dynamic
will actually spread further before people get too alarmed by it.

Congressman Barney Frank of Massachusetts talking about the
nonpartisanship of critical thinking on this issue – thank you so much.
It`s really good to see you.

FRANK: Thanks, Rachel.

MADDOW: Thanks.

All right. We got a report coming up from NBC chief foreign
correspondent Richard Engel who was in the middle of an incredibly hairy
scene and captured incredible footage. That`s still to come, plus lots
more.

Stay with us.

(COMMERCIAL BREAK)

MADDOW: Today, August 1st, 2012, was a really, really good day for
millions, for tens of millions of people in this country. Today, for those
tens of millions of Americans, life got a little easier, a little bit less
expensive, maybe a little healthier.

Things got a little bit better for lots of people in America because
of one thing that happened in policy, today.

Today also for the very same reason, that today was such a good reason
for so many people, for certain members of a certain political party in a
certain chamber of the United States Congress, today was a very, very bad
day. August 1st, 2012, a day we will remember in America as the end of
America as we knew it and loved it. August 1st, a day of somber reflection
for future generations and children and grandchildren, August 1st, 2012,
when the end began.

Still to come: the incredible true story of the conservative reaction
to what honestly was a really good day for millions of the rest of us and
even for millions of them. That`s coming up. Assuming the country doesn`t
implode before the end of this hour because of how scary August 1st, 2012,
was.

(COMMERCIAL BREAK)

MADDOW: NBC`s chief foreign correspondent is Richard Engel. He is in
Syria, in a safe place in Syria. He`s fine. But today, he was caught in
the middle of major fighting about 40 miles outside of the city of Aleppo.
Aleppo is at the center of the fighting in the war in Syria now.

Watch this report from Richard today.

(BEGIN VIDEOTAPE)

RICHARD ENGEL, NBC NEWS CHIEF FOREIGN CORRESPONDENT (voice-over): At
11:00 a.m., attack helicopters circle the sky over the city of Ariha. From
a roof top, we hear their assault begin. It sounds like artillery from the
helicopters. We move down to the alleys to try to find out why Syrian
forces are attacking this city of 70,000 south of Aleppo.

We see civilians fleeing from open areas, searching for cover, and
rebels on motorcycles in the main square.

(on camera): It appears that a large military convoy was passing by
this town on the way to join the attack on Aleppo. And as the troops were
moving past here, the rebels in this town opened fire on them.

(voice-over): In a makeshift rebel media center, activists tried to
upload videos of the attack they`ve taken with small cameras. They show me
Syrian tanks are now firing into Ariha.

The rebels attack the convoy to prevent reinforcements from reaching
Aleppo, but now, this city is paying for it.

Back in the alleys, men on a motorcycle tell us there are bodies up
the street, many. In a mosque, we find them, along with their distraught
relatives.

Witnesses say the victims were civilians standing outside a mosque and
attacked by a helicopter.

(on camera): There seem to be many casualties here. Eight bodies have
been brought. They can`t even bring them to the hospital, so they`re
putting ice on top of the bodies. They can`t move them around the city
yet, because there`s still too much helicopter fire, still too much mortar
fire coming in.

Men embrace the deceased.

“Oh, uncle, oh, uncle,” this man cries. The rebels in Ariha seem
desperately outgunned, and may have taken on a battle they can`t win. Each
fighter says he only has about 60 bullets, and homemade grenades. How are
you going to defend yourselves against a tank assault?

(SPEAKING FOREIGN LANGUAGE)

ENGEL: “God is with us,” he says.

Back in the media center, bad news has just arrived. One of the
rebel`s media activists has just been killed – one of more than a dozen
killed in Ariha today, and the rebels never stop the Syrian convoy headed
to Aleppo.

Richard Engel, NBC News, in northern Syria.

(END VIDEOTAPE)

MADDOW: To repeat, Richard and his team he was shooting with were
able to leave Ariha, they are safe tonight.

I should also tell you that NBC News confirmed tonight something that
was initially reported by “Reuters”, which is that President Obama has
reportedly signed a presidential finding, authorization unspecified
support, apparently not weapons, but other kinds of support to the Libyan
rebels, specifically to help them oust the Assad regime.

In terms of what we are actually doing to help the rebels, it
reportedly involves U.S. personnel helping at a secret command center,
operated by Turkey, along with some other countries.

The Syrian war seems to be on almost an infinite escalation track
right now, but it`s as hard to cover as ever.

We`ll be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

REP. MIKE KELLY (R), PENNSYLVANIA: I know in your mind, you can think
of the times when America was attacked. One is December 7th, that`s Pearl
Harbor day. The other is September 11th, and that`s the day the terrorist
attack.

I want you to remember August the 1st, 2012, the attack on our
religious freedom. That is the day that will live in infamy, along with
those other dates. The question is, if not us, who? If not now, when?

(END VIDEO CLIP)

MADDOW: That was Congressman Mike Kelly, Republican, obviously, of
Pennsylvania, speaking about a catastrophic deadly attack on the
sovereignty of our nation, which he says took place today. But which you
might not have heard about, even if you were paying super-close attention
to the news. If you did not, in fact, hear about this the grave national
crisis, on par with Pearl Harbor and 9/11, you are probably living in the
regular world here along with the rest of us and your family, I hope.

Congressman Mike Kelly, on the other hand, is living in a Republican
Party that increasingly consists only of its own far-right fringe.

And today, in that alternative Republican reality, there was an act of
war, of carnage, of unspeakable violence committed against this great
country by birth control.

Now, I will admit that I find the Bollywood dance video featuring this
Planned Parenthood life-sized birth control pill mascot kind of creepy.
But I would not say it rises to the level of Pearl Harbor or 9/11.

(BEGIN VIDEO CLIP)

KELLY: A date that will live in infamy, along with those other dates.

(END VIDEO CLIP)

MADDOW: The reason Congressman Mike Kelly is ranking today a along
with Pearl Harbor and 9/11 is because today is the day that, thanks to the
new health reform rule, women with health insurance will get free birth
control access as part of their health coverage. Access to birth control
is what Congressman Mike Kelly says is raining terror down on America. And
they say Rick Santorum didn`t win something in the Republican primary this
year.

(BEGIN VIDEO CLIP)

RICK SANTORUM (R), FORMER PRESIDENTIAL CANDIDATE: One of the things I
will talk about, that no president has talked about before, is, I think,
the dangers of contraception in this country and the whole sexual libertine
idea, and many of the Christian faith have said, “Well, that`s OK. I mean,
contraception is OK.” It`s not OK.

(END VIDEO CLIP)

MADDOW: Contraception is not OK. When Rick Santorum pledged to use
the office of the presidency to crack down on birth control last fall, Rick
Santorum was in exactly no danger of ever getting that opportunity, right?
But, of course, in a year when Republicans were excited about none of their
choices, everybody did get a turn to be on top of the polls, even Rick
“birth control is not OK” Santorum got his turn.

Rick Santorum`s political capital briefly rose among Republicans this
past year, and so did his early 20th century-era opposition to birth
control.

When Health and Human Services Secretary Kathleen Sebelius announced
in January that insurance plans would be required to cover preventative
services for women, including birth control, as of today, suddenly in the
year 2012, virtually the whole Republican Party started fighting against
access to birth control like they were defending Hickam Field in hindsight.

The Republicans spent about a month in February inveighing against
access to birth control, which must have felt great to them, until they
noticed stuff like the polling showing 40 percent of voters being less
likely to vote for the Republican presidential nominee because of his
pledge to eliminate the new birth control benefit. Maybe that was it.
Maybe it was whatever.

But whatever it was, Republicans had their sort of month of anti-birth
control, Rick Santorum candidacy, memorial excitement months ago. But then
they had kind of laid off the birth control fight for a while, until today.

Today, as the new birth control access rule goes into effect, as women
are seeing the benefits of greater access to contraception, Republicans are
back – back to talking about birth control access as a threat to
democracy, as an act of war against America.

(BEGIN VIDEO CLIPS)

KELLY: One is December 7th. That`s Pearl Harbor day. The other is
September 11th, and that`s the day of the terrorist attack.

I want you to remember August the 1st, 2012, the attack on our
religious freedom. That is a date that will live in infamy along with
those other dates.

REP. CHRIS SMITH (R), NEW JERSEY: The Obama coercion starts today.

REP. ANN MARIE BUERKLE (R), NEW YORK: As Mike said, August the 1st is
a day that we, as Americans will look at it as the largest assault on our
First Amendment rights.

REP. BILLY LONG (R), MISSOURI: Goodness gracious. The land of the
free, home of the brave – we`re no longer free in this country.

REP. STEVE PEARCE (R), NEW YORK: So, in New Mexico, we`re proud to
stand arm in arm with the Catholics and say, we`ll fight with you to the
death.

(END VIDEO CLIPS)

MADDOW: Jobs, jobs, jobs. Behold the Republican agenda for 2012, a
fight to the death rebellion, against birth control access!

Also, jobs, jobs, jobs, job-ortion.

Now, it`s time for “THE LAST WORD” word with Lawrence O`Donnell. Have
a great night.

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

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