Rick Gates testifies in Greg Craig trial. TRANSCRIPT: 8/22/19, The Rachel Maddow Show.

Guests:
Josh Gerstein, Letitia James
Transcript:

RACHEL MADDOW, MSNBC HOST:  Rehearsing blocking? 

 

CHRIS HAYES, MSNBC HOST:  Yes.  How we shoot different things.  We have to

do set changes.  We have to like figure out where the steady cam is in

relation to me, in relation to the audience. 

 

MADDOW:  Wow.

 

HAYES:  So, there`s a lot – a lot of blocking and tackling, to use a

football metaphor, that has to happen, that has to happen. 

 

MADDOW:  I was struck by fear by proxy today when it occurred to me in the

middle of our meeting, I was like, what`s Chris going to wear for pants? 

None of us have to think about that. 

 

HAYES:  We`ve solved that problem, and I will be in pants.  Those pants

have been purchased. 

 

MADDOW:  You have purpose bought pants for the live show? 

 

HAYES:  I do pants for the live show.  Live show pants. 

 

MADDOW:  I would like to put in a bid to buy them for the MSNBC primetime

2019 museum when you`re done with it. 

 

HAYES:  All right.  You are the first and last bidder probably on that. 

 

MADDOW:  Well, now that we put it out there, you would be surprised, my

friend.

 

Thanks, Chris.  Good luck tomorrow.

 

HAYES:  Thanks, Rachel.

 

MADDOW:  All right.  And thanks to you at home for joining us this hour. 

 

OK.  The first one who dropped out was Rick Perry.  Interestingly enough,

in the Trump presidency, it would eventually somehow be decided that good

old Rick Perry was exactly the right person to be put in charge of

America`s nuclear capability.  Oops. 

 

But way back in September 2015, Rick Perry was merely the first Republican

candidate to leave the Republican presidential primary for the 2016 race. 

He was the first candidate to go poof.  And when Rick Perry dropped out, we

drummed up this fancy new animation to show that Rick Perry had poofed out

of the race. 

 

And that turned out to be kind of a thing on this show.  After Rick Perry,

just ten days later, the next candidate to go poof was another high profile

Republican governor. 

 

(BEGIN VIDEO CLIP)

 

MADDOW:  Scott Walker is quitting, which means we get to poof him off the

list.  Ready?  Scott walker going bye-bye in three, two, one.  Poof.  Gone. 

 

(END VIDEO CLIP)

 

MADDOW:  Poof.  We started doing this for candidates in the gigantic

Republican presidential primary in 2015 and 2016, I think we didn`t really

think through the fact that I was actually signing us up to do that over

and over and over again, to do a lot of poofing, because once you start,

you can`t stop.  Can`t poof just one.  And so, it became this thing we had

to do all the time for months. 

 

(BEGIN VIDEO CLIP)

 

MADDOW:  Good-bye Mike Huckabee.  Poof. 

 

Rick Santorum.  Rick Santorum, are you ready?  Three, two, one, poof. 

 

Chris Christie, poof.  Carly Fiorina, poof.  And Jim Gilmore, poof. 

 

(END VIDEO CLIP)

 

MADDOW:  All in all, in 2015 and 2016, we ended up tracking the demise of

16 different Republican primary candidates right down to the bitter, bitter

end. 

 

(BEGIN VIDEO CLIP)

 

MADDOW:  Are you ready?  Are you ready?  Here it goes. 

 

Senator Ted Cruz dropped out last night.  Thank you for your time.  Sir,

poof. 

 

Then this morning, Ohio Governor John Kasich, the last man to be poofed get

poofed.  And that leaves alone among the smoking wreckage, he who will not

be poofed.  Donald Trump.  You win. 

 

The poof machine is retired.  All gone but one.  The Republican primary is

over. 

 

Now I want something new to poof. 

 

(END VIDEO CLIP)

 

MADDOW:  That was this show on May 4th, 2016, same outfit. 

 

But it has taken this long, it has taken more than three years to find

something new to poof.  But we do, of course, now have that new

responsibility once again.  As the impossibly large presidential field this

time is on the Democratic side. 

 

And we are already in August of 2015, we are already arriving at that time

in the race, when the first few contenders are deciding, they no longer

want to contend. 

 

Eric Swalwell of California became the first guy to leave the race back on

July 8th.  So, three, two, one, poof.  He was the first one poofed off the

list.  Congressman Swalwell was the very first one. 

 

Last week, we got to second one.  It was John Hickenlooper.  Poof. 

 

And now here last night on this very program, Washington State Governor Jay

Inslee became the third presidential primary candidate to get out of the

race.  And so now, for the first time, three, two, one – poof. 

 

Adios, Governor Inslee, from the presidential race.  I thank you kindly for

coming to talk to us to make your announcement here last night about why

you had decided to get out. 

 

And so, now, here`s where we`re at.  There is still a big, huge field of

Democrats out there.  But the win knowing process has started. 

 

And the stuff these candidates are leaving the presidential in already

interesting.  Even with only a few guys out.  As he hinted about in his

announcement here last night that he was leaving the presidential lace,

Washington Governor Jay Inslee today confirmed to the people of Washington

that he is going to run for a third term as governor of Washington state. 

 

There are not term limits for governors in Washington state, so, he can run

for a third term.  He is popular.  There`s nothing that went so wrong in

his presidential campaign other than him not winning.  Nothing from his

campaign that should give him too much baggage for that third term

gubernatorial run.  But we now know officially that that`s what Governor

Inslee is going to be doing.

 

And Colorado Governor John Hickenlooper announced today that he, too, is

going to keep running, even though he`s no longer running for president. 

After initially saying no way, no way, no way, after lots of people

including me asked him during his presidential run why he wasn`t running

for Senate instead, since there`s a vulnerable incumbent senator in his

home state, he said, no, no, no, wasn`t considering it, he would make a

terrible senator. 

 

Well, as of today, John Hickenlooper has officially jumped into the race

for U.S. Senate in Colorado.  He will be targeting that vulnerable

Republican incumbent, Cory Gardner.  What you are seeing is part of the

launch video for that Senate campaign today. 

 

Because Cory Gardner is seen as so beatable in the Senate race next year,

and because Colorado is shading to the bluer and bluer side of purple all

the time now, John Hickenlooper is a highly anticipated contender for the

Democratic nomination in that race.  But he`s going to be jumping into a

primary where there`s already a crowded field and a pretty well-funded

field of Democrats. 

 

For example, John Hickenlooper`s own wife is a maxed out donor to one of

the other Senate candidates who is already in that race besides her

husband.  Hickenlooper is in as of today.  He is popular in Colorado. 

 

As a theoretical Senate candidate, there was polling that showed him way,

way, way out ahead of every other Democrat in that field, like 50-plus

points ahead of any other Democrat.  Now that he is an actual candidate and

not just an idea, that fight might get a bit closer.  We shall see. 

 

I think politico.com won today for the best headline on the story of John

Hickenlooper jumping from the presidential race to the Senate race today. 

Their headline about that today, look, was, Hickenlooper goes from David to

Goliath, meaning he wasn`t that big a deal in the presidential race, it

turns out, but in the Senate race, he is a very big deal.  We will see

about John Hickenlooper making that late change and trying to be the

goliath in that U.S. Senate race that the Democratic Party sees as

absolutely winnable. 

 

We will also see about Jay Inslee going for a third term as governor in his

home state of Washington.  But watching Inslee and Hickenlooper make those

leaps today, I think only puts a fourth spotlight on what we`re expecting

to come in days ahead.  Right now, I think smart money says we`re going to

see a few other iterations on this theme in the next few days.  And that`s

simply – you know, it`s not that I have any intel on any individual

candidate, it`s because, simply, the deadlines are rolling in.  And the

middle of next week is the deadline for Democratic candidates to qualify

for the next Democratic presidential debate.  And they need to qualify both

by fund-raising numbers and by polling. 

 

And so far, this whole list of Democratic presidential contenders has not

yet qualified for the next debate.  They are all trying to get there, but

they`ve only got until the middle of the next week to do it.  Some of them

aren`t even close.  And some of these folks, it should be said, may try to

gut it out and stay in the race, even if they don`t make the next debate. 

 

But a bunch of them likely will not.  This is likely to be a cut bait

moment for more candidates than just the two who have dropped out within

the past week.  And so, over these next few days, I think for some number

of these folks, we may see them looking for the kind of off-ramp, this kind

of onward and upward next big thing that John Hickenlooper and Jay Inslee

both pulled out of their respective hats today. 

 

I mean, ultimately, all but one of the Democrats is going to go poof.  Only

one of them is going to be the nominee.  All the rest of them are going to

have to figure out what they`re going to do instead.  There`s better ways

and worse ways to get out of the race. 

 

I think Inslee and Hickenlooper think they`ve timed it well and picked the

right next thing to do so that their presidential campaign isn`t going to

hurt them or at least not too much.  A bunch of the Democratic candidates

right now staring down that deadline in the middle of next week, they are

looking for the strongest, most constructive, most dignified way to get out

of the race.  So, you know, I`m not – again, I don`t have any intel on any

individual candidate, but I think that`s what we are all expecting to

happen over these next five days. 

 

I will tell you right now that tomorrow night on this show, after Chris

Hayes does his special live audience show with his specially bought pants

and the rehearsed blocking and everything, we`re all very excited about it,

right after Chris` special live audience show tomorrow here on this show,

we`re going to have our own sort of special, it`s not a live audience. 

It`s still a live show here in studio.  I`m not taking off or anything. 

 

But tomorrow night, we`re fog to have a special show that is focused on the

2020 race specifically and on this crucial question of the strength of the

Democratic field.  Individual strength of individual candidates and their

strength as a field and whether or not their competition is building a

better nominee to ultimately take on Donald Trump.  We are working on that

special show tomorrow already.  I`m very excited about it. 

 

So, that`s to look forward to.  On tonight`s show, we`ve got a bunch of

stuff cooking.  First of all, I should tell you that New York`s Attorney

General Tish James is going to be our guest live in studio tonight. 

 

Being the attorney general of the state of New York is always a big deal

job, in particular, because of the stuff that New York as a state uniquely

has jurisdiction over that makes a lot of New York state cases and New York

state sort of attorney general crusades, things of national significance. 

It is always a big deal job.  It`s always a very high-profile job, usually

the highest profile state job in the country. 

 

But in the Trump presidency, all that has been even heightened.  In the

Trump presidency, being New York state`s attorney general means that stuff

it didn`t used to mean before.  It means getting sued by the president.  It

means suing him right back.  It means fighting for subpoenaed documents

from the president`s banks and financial institutions he`s dealt with and

his various businesses. 

 

As of right now, being New York`s attorney general also means suing the

administration specifically over their new anti-immigrant policies.  So,

Tish James is here in just a moment.  She is right at the center of a bunch

of stories of national significance where she is taking on the Trump

administration and the president and his business history in a way that

nobody else is positioned to do it.  I`m super happy to have her here. 

 

But before we get to that, there is one other story that I want to talk

about first and it`s a story that broke late this afternoon.  And the

reason I want to get to it off the top because we have somebody that is

going to be joining us in just a second who was there in the room when it

happened today.  All right, and by the room, I mean the courtroom.  This is

a legal drama that unfolded today in a way that I don`t know anybody

thought to expect. 

 

The deputy chairman of President Trump`s campaign, who was also the deputy

chairman of the president`s inaugural committee, a man by the name of Rick

Gates, Rick Gates is currently awaiting sentencing on two felony charges to

which he has plead guilty. 

 

While he awaits sentencing, he has been a cooperating witness for

prosecutors and it turns out they have been using him for multiple criminal

cases.  Rick Gates, for example, was the star witness in the federal

criminal trial against the president`s campaign Chairman Paul Manafort. 

When Manafort went up on trial in the Eastern District of Virginia, Rick

Gates spent three days on the witness stand explaining the various

financial schemes he said he had been involved in with Manafort or even at

Manafort`s expense. 

 

Rick Gates admitted on the witness stand in that trial to stealing money

from Paul Manafort, even as the two of them were busy defrauding other

people and institutions to effectively steal money from others.  Honor

among thieves and all that. 

 

Well, today, the illustrious alumni reunion of the president`s campaign

continued in court, with good old Rick Gates back on the witness stand

again as a star witness for the prosecution.  But this time, he was

testifying in the trial of Greg Craig, the former Obama White House

counsel.  Craig is the only member of a Democratic administration to get

caught up so far in one of the prosecutions that has derived from Mueller`s

investigation. 

 

Prosecutors say Greg Craig lied to the Justice Department about his work on

a Paul Manafort project in the Ukraine which took place after he left the

Obama White House a few years before the 2016 election.  The basic

allegation against Greg Craig is that he didn`t want to have to register as

a foreign agent being paid to work for a foreign country, because that

might interfere with future jobs he might be able to get in the U.S.

government and because it would mean having to report way too much shady

and embarrassing detail about this Ukraine scheme he was involved in with

Paul Manafort and how much everybody was getting paid and by whom. 

 

I think the good news for Greg Craig today on what is by far been the most

dramatic day of his trial, the good news for Greg Craig today is that the

star witness against him, I mean, really is this guy, Rick Gates, deputy

chairman of the Trump for president campaign, who is not exactly a paragon

of virtue or of truth.  I mean, if you had to pick the star witness against

you, you might want a guy who had to admit to tons of crimes while he was

also testifying about bad things he said you did, right? 

 

On the witness stand today, Rick Gates described a little bit of what his

life has been like as a cooperator.  He mentioned at one point that he`s

unemployed.  He said he has met with federal investigators about, hmm, 40

times since he`s been a cooperating witness, 40 meetings with prosecutors? 

 

Defense attorneys made Rick Gates today admit to the court that he was

testifying in this trial as part of his cooperation deal, because he hopes

his cooperation with the government would result in him not having to serve

prison time for the felonies to which he has already plead guilty.  The

defense lawyer cross-examining Rick Gates at one point said, quote, you

also, under the plea agreement, get a promise you won`t be prosecuted for

other crimes.  And you`ve committed a few.  Excuse me, you`ve committed

quite a few, to which Rick Gates replied, yes. 

 

Right?  That`s a dark moment, even when you are a cooperating witness for

the government.  Yes, yes, yes, I have committed quite a few crimes.  Are

we going to go through them all?  Oh, we are?  OK. 

 

But even as Rick Gates is forced under cross examination to admit that he

has committed quite a few crimes, today, he also appeared to accuse a lot

of other people of committing quite a few crimes, as well.  Under oath, on

the witness stand, where his own tuckus staying out of prison depends on

this totally, today Rick Gates not only testified against Greg Craig to

support prosecutors allegations that he lied to the Justice Department

about the work he did for Manafort in Ukraine.  Today, surprise, Rick Gates

also testified that there were more D.C. bigwigs who were in on that scheme

– specifically more D.C. bigwigs who knew they were working for a foreign

government – because he, Rick Gates, says he told them they were working

for a foreign government. 

 

Prosecutor says to Gates, quote, did you tell them who the client actually

was?  Gates, yes.  Prosecutor, and who was the client?  Gates, the

government of Ukraine. 

 

Before the 2016 campaign ever happened, President Trump`s campaign chairman

ran this scheme in Ukraine.  President Trump`s campaign chairman in prison

now.  His deputy who was trying to stay out of prison now is acting as a

cooperating witness in part by unraveling this scheme in open court. 

 

The scheme itself now threatens to put in jail President Obama`s first

White House counsel.  It has caused President Obama`s first White House

counsel`s super fancy law firm to enter into a formal non-prosecution

settlement with the Justice Department. 

 

And now today in court, Rick Gates started implicating multiple high-end

D.C. lobbying firms in the scheme, as well.  Firms run by Democrats and by

Republicans.  And, you know, part of the story is that the sitting

president of the United States turns out to have hired some amazing people

along his way to the White House.  Quite a number of whom have since been

sent to prison or are awaiting sentencing. 

 

But this part of it, about this scheme in Ukraine, that preceded the

campaign, that involved all – I mean, this part seems to be metastasizing

all across high power Washington. 

 

Joining us now is Josh Gerstein, senior legal affairs contributor at

“Politico”, who was, as I said in the room as it happened today. 

 

Josh, it`s great to have you here.  Thanks for joining us. 

 

JOSH GERSTEIN, SENIOR LEGAL AFFAIRS CONTRIBUTOR, POLITICO:  Hey, Rachel. 

Good to be with you. 

 

MADDOW:  So, let met ask you, when Rick Gates on the witness stand today

started saying, yeah, these lobbying firms, they knew definitely that they

were working for a foreign country and the reason I know that is because I

told them directly, did it seem to you that that was a surprise in the

courtroom?  Was there reaction in the courtroom to that exchange? 

 

GERSTEIN:  Well, it came at the tail end of his testimony, so, it came at a

point where we didn`t really expect we`d be getting much new out of him.  I

think, you know, for those who were attending, it wasn`t as crowded as the

last time Rick Gates testified, when it was definitely sort of a capacity

almost standing room only crowd.  There aren`t as many people interested in

Greg Craig as there were in Paul Manafort. 

 

It did come as something of a surprise, kind of a collateral damage kind of

thing that we weren`t exactly expecting.  Now, it should be said, there

have been court filings and other articles and stuff, obviously, indicating

that the lobbying groups involved here, the Mercury is one of them, and the

Podesta Group is the other.  But there hasn`t been as much sort of directly

pointing at specific individuals, which is what happened today, the head of

Podesta, Tony Podesta, and a top lobbyist at Mercury, Vin Weber, who is a

former Republican congressman, Gates saying directly they knew they were

working for the government of Ukraine, yet they went ahead and basically

told the federal government they were just working for sort of a private

sector think tank. 

 

MADDOW:  Does it seem like – you use the phrase collateral damage.  I

mean, we know a little bit about this Ukraine scheme.  We know Manafort

engaged this white shoe very fancy law firm, Skadden, where Greg Craig was

working, where Alex Vander Swann, who`s another person went to jail, a

Mueller related investigation was working.  We know that he engaged PR, at

least one PR firm.  We know that he engaged lobbying firms, as well. 

 

It`s starting to feel like everything who touched this, everybody who

worked with Manafort on this particular gig, has got some sort of exposure

or at least a lot of hassle in terms of the kind of work this was and the

fact that the Justice Department is newly interested in prosecuting people

for potentially working for foreign governments without registering as

foreign agents. 

 

GERSTEIN:  Yes, they definite have hassle, and there`s no question the

Justice Department has poured through all kinds of emails and other

communications.  I think that the notion that prosecutors would tie a case

specifically to someone like Rick Gates – in other words, would they build

a case where they don`t think they could quite prove it, but with Rick

Gates, they think they could prove it?  I`m a little doubtful of that. 

 

I mean, he listed, as you were saying earlier, Rachel, so many lies that

he`s told over the last several years, so many deceptions, so many crimes. 

At times, he was sort of arguing with one of the defense lawyers about

whether he told this particular lie or not.  It seemed he couldn`t keep

them straight. 

 

So, I don`t think he`s the kind of guy that you would bring in unless you

thought you had a pretty strong case to start with.  If it`s just a matter

of Rick Gates word that, you know, I told these people that and maybe later

I told them something different, prosecutors are going to want something

pretty solid and corroborative to go with that. 

 

MADDOW:  Briefly, Josh, though, am I right that Gates, however trustworthy

as he is in the human, has every incentive in the world to not be caught

out telling an untruth on the stand right now, in part because the judge

who is about to sentence him, taking into account his cooperation and how

truthful he has been and how effective he has been as a cooperator for the

government, the judge who will sentence him is the same judge who is

overseeing this trial right now against Greg Craig and before whom he was

testifying today. 

 

GERSTEIN:  Right.  And it seemed today, Rachel, there were two cases being

heard at the same time, Craig`s case, which is almost completely removed

from what we were just talking about with Weber and Podesta.  But also,

sort of a dry run, maybe, for the sentencing of Rick Gates, because he was

sitting there, eight or ten feet away from the judge.  She was watching him

very closely. 

 

And it seemed to me like he was actually impressing her, despite the

history of lies.  At several point, she defended him during this hearing,

you know, blocked defense lawyers from – I think she thought they were

hectoring him a little bit and told them to back off.  So, if his intent

was to try to stay on her good side, it seemed to me he had done that

successfully.  Whether that means he gets away with probation, as he`s

hoping for, that`s something we`ll have to see when he comes up for

sentencing in a few months. 

 

MADDOW:  Amazing.  Josh Gerstein, senior legal affairs contributor at

“Politico”, your dispatches from the court are the next best thing from

being there.  Josh, thanks very much helping us understand.

 

GERSTEIN:  Thanks, Rachel. 

 

MADDOW:  All right.  Much more to come tonight, including New York`s state

attorney general, Tish James, is going to be here live shortly. 

 

Stay with us. 

 

(COMMERCIAL BREAK)

 

MADDOW:  So, federal law says that the Ways and Means Committee in Congress

is allowed to see anybody`s tax returns that they want to, even the

president`s.  It is black letter, clear claw.  It`s not legally

controversial.  There`s plenty of precedent to support it, even getting the

president`s tax returns that way.  It`s been that way forever.  It`s been

that way for, like, a century. 

 

Well, a few months ago, in April, Democrats in the house decided they would

use that power.  The chairman of that committee, Ways and Means Committee,

Massachusetts Congressman Richie Neal, told the Treasury Department he was

going to invoke that authority.  And he, therefore, requested from the

treasury department six years of president Trump`s tax returns.  Chairman

Neal set a deadline for them to respond, then another deadline, the

Treasury blew through them. 

 

So, then, the House Democrats decided they would subpoena the Treasury

Department to get the president`s tax returns.  Treasury basically blew

that off, too. 

 

In response, last month, the committee filed a federal lawsuit to enforce

the subpoena.  And ever since, that case has been sort of, you know,

plunking along, slowly, slowly.  Until this week, suddenly, there was,

like, this confetti cannon of new activity, new filings. 

 

Richie Neal`s committee asked the judge for expedited consideration and a

summary judgment because, quote, there are no genuine issues of material

fact at issue in this case.  On the other side of it, the Trump Justice

Department told the judge to go slow, not fast.  They`re claiming that

there are complex constitutional issues at stake.  They told the judge this

week there`s no reason to bring these proceedings to a gallop.  This is a

horse that would prefer to trot and go very slow. 

 

So, this is a case, as I`ve said, it`s been plodding along, you know,

methodically moving its way.  All of a sudden, though, this week, there`s

been a ton of action in this case you and a ton of paper, literally, a ton

of paper.  For the motion from Congress this week, the one that asked the

judge to go ahead and rule, asked for a summary judgment, there were 54

attachments filed to that motion.  I decided I would print them out, which

was a bad move. 

 

Except, turns out, tucked in there, if you read enough of them, you

eventually get to exhibit QQ.  You have to use letters twice once you get

past – right.  It`s exhibit QQ.  It`s a letter from Ways and Means

Chairman Richie Neal to Treasury Secretary Steven Mnuchin. 

 

Dear Secretary Mnuchin, on July 29th, 2019, the committee received an

unsolicited – the word unsolicited is underlined – an unsolicited

communication from a federal employee setting forth credible allegations of

evidence of possible misconduct, specifically potential inappropriate

efforts to influence the mandatory audit program, meaning the mandatory

program that requires the audit of the income tax returns of a sitting

president. 

 

So, what the committee is saying here is that they didn`t ask for it, but a

whistleblower came forward to them from inside the government to give them

information, to give them credible allegations of something having to do

with the way the IRS is handling Trump`s taxes and the audit of Trump`s

taxes. 

 

This whistleblower has come forward, according to the committee, with

evidence of possible misconduct related to the inappropriate efforts to

influence the audit of President Trump`s taxes.

 

Back to the letter.  Quote: In light of the serious and urgent concerns

raised by this new information, I have requested a rolling production of

certain documents and communications of specified Treasury and IRS

employees.  Thank you in advance for your prompt attention to this matter. 

 

So, it`s kind of amazing in this news environment.  I mean, this – is the

only – exhibit QQ, this is the only thing we have seen about this ever,

right?  I mean, the issue of President Trump not handing over his tax

returns, the first president since Watergate to not hand over his taxes, I

mean, that`s one of the highest profile and longest-standing controversies

about him as a politician. 

 

But it`s being pursued as an oversight matter in the House now by one of

the quietest and lowest key committee chairmen.  Richie Neal of

Massachusetts is not on television ever for a reason.  He likes to do this

all very, very quietly, very, very methodically. 

 

And so, here is this eyebrow-raising claim that a whistleblower has come to

the committee with credible allegations that there have been inappropriate

efforts to influence the auditing of the president`s taxes, and it is

buried literally as exhibit QQ among a 1 other attachments to an unheralded

court filing that they didn`t even put a press release about. 

 

Now, we really don`t know what this is about.  We don`t know what this

whistleblower has alleged and we don`t know what these, according to the

committee, credible allegations are.  We don`t know what this whistleblower

says has been the inappropriate effort to influence the audit of Trump`s

taxes.  We don`t know. 

 

But the judge in this case may find out soon.  If you go down to the

footnotes, quote, the committee is prepared to submit to the court the

materials that led to Chairman Neal`s request.  So – you know, just

another day in the president`s finances.  Now, it`s a federal judge being

offered information from a congressional committee about an unsolicited

whistleblower who has come forward with credible allegations of

inappropriate efforts to influence the handling of the president`s tax

audit inside the IRS. 

 

So, that is now on the burner.  And now tomorrow, first thing tomorrow

morning, another pot is about to come to a boil.  And that story is next

with our guest, Tish James, the attorney general of the state of New York. 

 

Stay with us. 

 

(COMMERCIAL BREAK)

 

MADDOW:  Here`s something to keep an eye on tomorrow morning.  Ten a.m.,

before the Second Circuit Court of Appeals in New York, federal appeals

court that sits in New York, there will be oral arguments in the case of

Donald J. Trump and Donald J. Trump Jr. versus the Committee on Financial

Services.  This is the president trying to block Democrats in the House

from getting his financial records. 

 

In April, two committees in the House subpoenaed Capital One and Deutsche

Bank to gain access to financial records related to the president.  The

president`s long-time personal attorney general Michael Cohen had testified

under oath that the president inflated his assets and lied about the value

of things that he was in control of in order to secure bank loans or for

insurance purposes.  The way Michael Cohen described it, he said those

things could potentially amount to criminal bank fraud or criminal

insurance fraud. 

 

Cohen`s testimony led to the subpoenaed by House Democrats to pry loose the

president`s financial information from his bank and accounting firm to see

if documents from those institutions might corroborate his allegations. 

Even since then, there have been more allegations of that kind.  “The

Huffington Post” is now reporting that the president filed financial

disclosure statements that appear to misstate the value and profitability

of his golf courses in Scotland by just a little bit, by just $165 million. 

 

He said in his American public filings that those properties were each

worth $50 million.  At the same time, he told authorities in the U.K. that

those properties weren`t worth anything like that.  They were, in fact, $65

million in debt.  Well, they could be either, but they can`t be both. 

 

What`s lurking in the president`s financial and business records that

Congress has been working so hard to get?  I mean, that fight is on.  It`s

this red-shot fight, waged in large part by the president to try to keep

anybody from knowing what`s in his taxes or his financial records. 

 

So, we`ll see arguments in federal appeals court in New York tomorrow at

10:00 a.m. over whether or not Trump is going to be able to get Trump`s

bank records, and that`s just one of the lawsuits that president has

engaged in to try to stop Congress from getting his taxes and financial

records.  There`s a whole bunch of them.

 

But, you know what?  Whatever happens with all of those federal cases and

his fights with Congress, President Trump has another thing on his hands

when it comes to a totally different adversary and inquisitor, the New York

state attorney general. 

 

In March, New York Attorney General Letitia James subpoenaed Deutsche Bank

for the Trump Organization`s financial records, including those related to

the schemes that Michael Cohen described in his testimony.  Tish James is

also leading an incredibly potent investigation right now into a key Trump

political ally, the NRA.  That`s an investigation that has already plainly

managed to freak out the NRA and its leadership. 

 

And just this week, Tish James launched a new lawsuit against the Trump

administration over its recent immigration policies.  What have you been

doing with yourself this summer? 

 

Joining us now is New York State Attorney General Letitia James.

 

Madam Attorney General, I`m really happy you`re here.  Thank you for coming

in.

 

LETITIA JAMES, NEW YORK STATE ATTORNEY GENERAL:  Thank you so much for

having me. 

 

MADDOW:  I know that summarizes only a tiny piece of what and your office

are doing right now.  But that`s some of the stuff I have been trying to

keep up with. 

 

JAMES:  Seventeen cases since I took office eight months ago, one every two

weeks. 

 

MADDOW:  Really? 

 

JAMES:  Yes. 

 

MADDOW:  Tell me about the financial piece of this first.  It has been

interesting to me to watch the president fight tooth and nail.  He hired a

whole new raft of lawyers that are only trying to keep his taxes and

financial information secret.  And he`s got a bear of a fight over that,

both in his taxes and his financial documents with multiple committees in

congress. 

 

But he also seems to have a real fight with you on that.  Can you tell us

about the progress on that? 

 

JAMES:  So, Rachel, before I get into the litigation, let me just tell you

about who I am and let me just set the table for you. 

 

MADDOW:  Please?

 

JAMES:  We are a country of laws and rules, and it`s really critically

important that we adhere to those laws and rules.  And what guides me and

my principles is, I believe in equality and I believe that the law should

apply to all of us and no one is above the law.  Those are simple concepts

and simple principles that I believe in. 

 

And I also believe that as the attorney general of the great state of New

York, that I cannot sit idly by and allow someone to basically subvert the

United States Constitution or the Constitution of the great state of New

York.  And that explains all of the litigation we`ve been involved in. 

 

We have a federal government which unfortunately has been engaged in

retrenchment, a federal government which is closed.  And so, all of these

lawsuits are defending the rights of immigrant, the rights of women, the

disabled, the rights of individuals and their health care, the environment. 

And the list goes on and on and on. 

 

And if we, again, are to continue the progress that we`ve made in this

nation, if we are to believe in the simple concepts of equality for all and

justice for all, then you`ve got to fight and you`ve got to stand up.  You

have to use the law both as a sword and as a shield. 

 

Getting to your question.  So, there are a number of investigations going

on in our office as a result of the testimony of Michael Cohen.  They raise

some legitimate concerns. 

 

Now, the president of the United States has complained that I`m engaging in

some sort of political witch hunt, that I`ve got some personal vendetta

against him, that I campaigned against him. 

 

That is not true.  I`ve not politicized the office.  Mr. Cohen raised

questions and some issues that I am obligated as the attorney general of

the state of New York to pursue.  And so, we are following the facts and

the evidence. 

 

And some of these cases, unfortunately, I cannot divulge, I cannot give you

a status or update where they are.  I can only tell you that the office of

the attorney general is standing up for the law, and, again, no one is

above the law, including the most powerful individual in this country, and

that is the president of these United States. 

 

MADDOW:  The financial issues in particular, one of the things that we can

watch in those federal court fights that are happening between the

president and various congressional committees, is that we can see how the

president filing individual lawsuits, the president employing the Justice

Department in some cases to come in on his side in those lawsuits against

Congress and them trying – we can sort of see how his legal strategy has

stopped those inquiries or at least slowed them down for now.  In terms of

the way that he has fought you on these matters, do you feel that you have

been stopped or that you have been diverted from anything that you`re

pursuing because of his work? 

 

JAMES:  By no means.  See, the president of the United States uses the

lawsuits, he hides behind the law.  And what we need is accountability and

transparency.  For instance, the Trust Act.  The Trust Act was an act

passed by the New York state legislature, which basically says that the

three committees in the United States Congress can ask for the president`s

tax records in the state of New York, his state taxes. 

 

So, we`re in litigation right now, because the president individually and

personally filed a lawsuit against me, the ways and means committee of

Congress as well as New York taxation and finance, basically blocking his

taxes.  And as you know, Rachel, every president has offered up their

taxes.  Their state and their federal taxes, but not this president. 

 

Why shouldn`t the law apply to him?  Why shouldn`t he be held accountable? 

Why shouldn`t he provide transparency to me and individuals who would like

to see his taxes? 

 

MADDOW:  Let me ask you – this is a naive question.  You can tell me I`m

dumb for asking it. 

 

JAMES:  I would never do that. 

 

(LAUGHTER)

 

MADDOW:  I might deserve it sometime.  Don`t rule it out.  But on that last

point that you were just making about this New York state law that says

under certain circumstances, a person`s state – the president`s state tax

returns could be handed over to the appropriate members of Congress, if

that gets to the end of the line, in terms of the president trying to sue

you and trying to block that in court and trying to fight that out through

litigation, and the president just decides, you know what, I`m going to

flunk that law, what is New York going to do, arrest me? 

 

I mean, where does that end, if the president decides that`s a state law

and he just doesn`t feel bound by it, even if he loses in the court? 

 

JAMES:  So, the reality is, we are fighting this case, one, because it was

filed in the District of Columbia, and we believe New York is not subject

to the jurisdiction of the District of Columbia and the case should be

heard here in New York.  And, two, he`s arguing that the Trust Act is in

violation of the First Amendment and we are somehow retaliating against him

because of his political views and nothing can be further from the truth. 

 

If, in fact, he loses and, right now, the case is being held up until we

resolve these just jurisdictional issues, if we win, and if Chairman Neal

of Ways and Means requests his state taxes in furtherance of congressional

responsibilities and duties, and then we have – we will turn over those

state taxes.  And so, Chairman Neal has yet to ask us and so it`s really

premature to bring this lawsuit and I`m confident that his lawsuit against

me, against taxation and finance and against Chairman Neal will be

dismissed because it is premature. 

 

MADDOW:  One other matter I want to ask you about, but we`re going to take

a quick break.  You appear to be driving the National Rifle Association to

distraction right now with your investigation that involves their –

potentially their nonprofit status, I`d like to ask you about that when we

come back. 

 

JAMES:  Sure. 

 

MADDOW:  We`ll be right back.  Stay with us.

 

(COMMERCIAL BREAK)

 

MADDOW:  Joining us once again is New York State Attorney General Letitia

James.  Attorney General James, thank you for staying with us.  Much

appreciated. 

 

A few days ago on the show, I talked about you being sued, once again, in

your official capacity as attorney general.  And in this case, I was just

puzzled by it, because the NRA was suing you, your office, I know, has

launched an investigation into the NRA, looking into the group`s financial

dealings, looking into whether the group may have abused its nonprofit

status, they are chartered here in New York state. 

 

And as I understood it, and as explained it to our viewers, the NRA was

suing you because you had subpoenaed Oliver North, the former president of

the NRA, you were planning to depose him pursuant to that subpoena, and the

NRA was suing you because they wanted their own lawyers in the room while

you deposed him. 

 

JAMES:  Correct.  And they lost. 

 

MADDOW:  Ah.  OK.  Why did they sue you over that? 

 

JAMES:  They were suing me basically saying that it was in violation of

certain privileges, attorney-client privilege.  And they lost.  And so, we

will be deposing Oliver North and we will be looking into the NRA and their

finances to determine whether or not they violated not for profit law in

the state of New York. 

 

There`s been a number of allegations and there`s been a number of

individuals who have stepped forward who serve on their board who want to

cooperate with our office.  So, clearly, we have a responsibility and a

duty to ensure that individuals who contributed to the NRA, that it has

been done in accordance with New York state law. 

 

MADDOW:  So, I know that your office subpoenaed something like 90 people

who, including a lot of current and former board members –

 

JAMES:  Correct. 

 

MADDOW:  With the NRA.  Some of the people who either served in the past or

currently serve on the board are helping with your investigation? 

 

JAMES:  A number of individuals have reached out to us with respect to the

NRA. 

 

MADDOW:  In terms of the NRA`s nonprofit status, they are chartered in New

York state.  That means it is in your jurisdiction in terms of whether or

not they hold on to that status.  Is that specifically what is at risk for

them if these allegations are born out or are their other potential ways

they might be on the hook? 

 

JAMES:  Because they are chartered in the state of New York and because we

have a responsibility and duty to ensure that all not-for-profits in the

state of New York, adhere to the laws of the state of New York and protect

individuals who contribute to not for profits, and they follow the law, we

are assigning and ensuring they comply with the laws, as all of the

nonprofit laws have to do in the state of New York. 

 

MADDOW:  OK.  Attorney General Tish James of the great state of New York, I

feel like every story that I cover has a Tish James angle, so, any time

you`d like to come in and either correct me or help me understand it. 

Please?

 

JAMES:  Well, the president of the United States says that I am bludgeoning

him.  And so, to me, that`s a badge of honor. 

 

MADDOW:  Wow.

 

JAMES:  And – but again, he needs to understand the rule of law applies to

him as well and no one is above the law and the law should be used as a

sword and a shield to protect vulnerable and marginalize people and project

the great state of New York.  So, I`m doing that.  And believe it or not, I

can`t believe I`m standing up for states rights.  That`s sort of ironic. 

That`s what I`m doing.

 

(LAUGHTER)

 

MADDOW:  In a very specific way. 

 

JAMES:  Exactly.

 

MADDOW:  Attorney General, thank you so much. 

 

JAMES:  Thank you. 

 

MADDOW:  All right.  We`ll be right back.  Stay with us. 

 

(COMMERCIAL BREAK)

 

MADDOW:  One thing I want to mention about something we just talked about

with Tish James, and also something I talked about at the top of the show. 

I mentioned at the top of the show that former presidential hopeful John

Hickenlooper, two-term governor of Colorado, announced today that instead

of continuing his presidential race, he is going to run for U.S. Senate

seat in Colorado.  Currently, that Senate seat is occupied by freshman

Republican Cory Gardner, who was widely considered to be among the most

vulnerable Republican senators who is up for re-election in 2020. 

 

If Democrats are ever going to take the Senate and remove Mitch McConnell

from his job as Senate majority leader, there probably isn`t a path to do

that that doesn`t involve a Democrat beating Cory Gardner and taking his

seat.  And that is why you should see this. 

 

In addition to John Hickenlooper joining that primary field against

Gardner, in addition to this newly upped pressure on Gardner from the

Democrats who want to replace him, we just exclusively got this new ad from

every town for gun safety, which is about to turn the pressure on Cory

Gardner up another notch. 

 

(BEGIN VIDEO CLIP)

 

UNIDENTIFIED FEMALE:  Lone gunman opens fire in Aurora, Colorado. 

 

UNIDENTIFIED FEMALE:  Newtown, Connecticut.

 

UNIDENTIFIED MALE:  Orlando. 

 

UNIDENTIFIED FEMALE:  Las Vegas. 

 

UNIDENTIFIED MALE:  Parkland. 

 

UNIDENTIFIED MALE:  Pittsburgh. 

 

UNIDENTIFIED FEMALE:  Mass shooting in El Paso. 

 

UNIDENTIFIED MALE:  Dayton, Ohio. 

 

ANNOUNCER:  It seems like every day, there`s another shooting.  This isn`t

normal.  It`s time our elected officials did something about it. 

 

Tell Cory Gardner and Mitch McConnell to stand up to the gun lobby and pass

bipartisan background checks and red flag laws to keep guns away from

people who pose a danger to our communities. 

 

(END VIDEO CLIP)

 

MADDOW:  Again, we got that exclusively from every town for gun safety. 

That ad is part of a national campaign pushing on Republican senators

around the country, and in that one targeting Gardner on an issue where

they think he may lose votes and be vulnerable in Colorado.  And so, yes, I

mean, the top of the ticket always seems like the spot worth fighting for,

but as this Democratic presidential field narrowing down, these candidates

may be heading back to really real fights that are playing out back at home

and Democrats do seem increasingly confident that part of the way they`re

going to win hard races is by going hard on the issue of gun reform. 

 

We`ll be right back.  Stay with us. 

 

(COMMERCIAL BREAK)

 

MADDOW:  That does it for us.  We will see you again tomorrow, when again,

we`re going to be doing a special show focusing on the strength of the

Democratic 2020 field.  Very excited about that.  But I`ll see then.

 

Now, it`s time for “THE LAST WORD WITH LAWRENCE O`DONNELL”.

 

Good evening, Lawrence. 

 

                                                                                                               

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