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All In with Chris Hayes, Transcript 8/11/2016

Guests: A.J. Delgado, Betsy Woodruff, Sabrina Siddiqui, Liz Plank, Cornell Belcher, Allen Kruger

Show: ALL IN with CHRIS HAYES Date: August 11, 2016 Guest: A.J. Delgado, Betsy Woodruff, Sabrina Siddiqui, Liz Plank, Cornell Belcher, Allen Kruger


CHRIS HAYES, MSNBC HOST (voice-over): Tonight on ALL IN --

DONALD TRUMP (R), PRESIDENTIAL NOMINEE: I`d call President Obama and Hillary Clinton the founders of ISIS.

HAYES: Way behind and lashing out.

TRUMP: No, it`s no mistake. Everyone is liking it. I think they`re liking it.

HAYES: A fatalistic Donald Trump considers the end.

TRUMP: At the end, it`s either going to work or I`m going to, you know, I`m going to have a very, very nice long vacation.

HAYES: Tonight, new reporting that the RNC has asked the candidate to change, warning him, he`s headed for failure.

TRUMP: You can send out the word to Ohio, Pennsylvania, some of those really important swing states.

HAYES: Then, new polling on the single most effective Clinton attack ad.

TRUMP: Oh, I don`t know what I said. I don`t remember. He`s like I don`t remember --

HAYES: Why those remarks mocking a reporter just keep resonating.

Plus, Hillary Clinton lays out a strikingly progressive economic agenda. But can she get it done?

And back in Miami --

TRUMP: We own Doral, which is one of the, one of the great places in the world.

HAYES: Donald Trump`s country club and the small businesses who say Trump is refusing to pay.

TRUMP: I think it`s the greatest resort or just about.

HAYES: When ALL IN starts right now.


HAYES: Good evening from New York. I`m Chris Hayes.

Donald Trump has never been known to apologize for any of the offensive and inflammatory things he said over the course of his presidential campaign. But with his assertion, first made last night, that the president of the United States founded the world`s most reviled terrorist group, Trump appears to have reached a whole new level of defiance.

In an interview this morning on CNBC, not only did he refuse to back off of this ludicrous claim, Trump seemed all together puzzled that anyone might object to it.


UNIDENTIFIED MALE: Do you think it`s appropriate to call the sitting president of the United States the founder of a terrorist organization that wants to kill Americans?

TRUMP: He was the founder of ISIS, absolutely. The way he removed our troops, they shouldn`t have gotten out the way they got out. It was a disaster what he did.

UNIDENTIFIED MALE: How do you think --

TRUMP: Is there nothing wrong with saying that? Are people complaining that I said he was the founder of ISIS?


HAYES: This morning, Trump also called into a radio show hosted by conservative commentator and MSNBC political analyst Hugh Hewitt who tried mightily to offer Trump a more palatable, nuance way to frame the critique of President Obama.


HUGH HEWITT, RADIO HOST: I know what you meant. You meant that he created the vacuum, he lost the peace.

TRUMP: No, I meant he`s the founder of ISIS. I do. He was the most valuable player. I give him the most valuable player award. I give her, too, by the way.

HEWITT: But he`s not sympathetic to them. He hates them. He`s trying to kill them.

TRUMP: I don`t care. He was the founder. His, the way he got out of Iraq was that was the founding of ISIS.


HAYES: Trump went on to describe what seems to be the main justification for his claim about the president, people like it.


HEWITT: But by using the term "founder," they`re hitting with you on this again, mistake?

TRUMP: No, it`s no mistake. Everyone is liking it. I think they`re liking it. I gave him the most valuable player award. And I gave it to him and the cofounder to Hillary. I don`t know if you heard that.

HEWITT: No, I did. I played it. I just -- I know what you are arguing --

TRUMP: Let me ask you, do you not like that?

HEWITT: I don`t.


HAYES: This week was supposed to provide a much new general election reset for Trump`s campaign, starting with an economic speech on Monday. But the nomine can`t seem to get out of primary mode, telling "Time Magazine" in a moment of tremendous honesty, "I got 14 million votes and won most of the states. I`m liking the way I ran the primaries better."

Nevertheless, it seems to be dawning on Trump or perhaps the first time, that something really isn`t working. He is actually losing this race as of now.

Speaking at a meeting of evangelical leaders in Orlando today, Trump pleaded for help in certain key states.


TRUMP: I have a tremendous problem in Utah. Utah is a different place. Is anybody here from you that you? I didn`t think so.

We`re having a problem.

We need help in Ohio. We`re very close in Ohio. Ohio is very close. We need help. If you could send out the word to Ohio, Pennsylvania, some of those really important swing states.


HAYES: Still, given a choice between expanding his appeal to the broader electorate and firing up his rally crowds, Donald Trump clearly prefers the latter. Remarkably, he is starting to seem resigned to likely result.


TRUMP: All I do is tell the truth. If at the end of the 90 days, I fall in short because I`m somewhat politically correct even though I`m supposed to be the smart one and even though I`m supposed to have a lot of good ideas. It`s OK, I go back to a very good way of life. I will keep doing what I am doing right now, and at the end, it`s either going to work or I`m going to, you know, I`m going to have a very, very nice long vacation.


HAYES: Trump`s electoral meltdown could have an impact beyond his campaign. According to recent polls, Trump is just two points ahead of Hillary Clinton in South Carolina, than the margin of error. They`re tied in a statistical dead heat in Arizona. He trails Clinton by 4 points in Georgia, which hasn`t picked a Democrat for president since 1992.

With numbers like that, Trump could drag down the Republican candidates the whole way down the ballot.

The question now for GOP leaders is whether it`s time to pursue something like the party strategy in 1996 when it shunned the presidential nominee Bob Dole in order to save Congress. According to one report, RNC Chairman Reince Priebus gave Trump last week, informing him his campaign seems to be headed for failure. Now, over 70 Republicans calling on Priebus to cut Trump off, writing an open letter urging the RNC to channel its funds towards down ballot races.

Joining me now, conservative columnist, Trump candidate surrogate A.J. Delgado.

A.J., it`s great to have you.

OK, could we just start? Let`s start with just word. You are a very gifted communicator. You know how words -- you are a lawyer. Barack Obama didn`t found ISIS, we can agree with that, some hyperbolic sense. But the statement that Barack Obama founded ISIS is an untrue statement?

A.J. DELGADO, TRUMP SURROGATE: No, not if you`re speaking figuratively. He didn`t say he was the literal founder.

HAYES: Yes, right, OK. Figuratively, right. But then Hewitt said I get where you are getting at. You are saying there was a vacuum. And he says, no, Barack Obama founded ISIS. So, why did he do that?

DELGADO: He said no because it`s more than that. It`s more than just Obama created the vacuum. It`s also about the way Obama withdrew the troops. Obama would admit, there was talk of leaving more troops there as advisers and managerial mode. That was not done. That`s what Trump is speaking about.

HAYES: OK. So, let`s stay that that`s what he`s saying. Here is Trump in 2007 on precisely this issue. Do we get out of Iraq, stay in Iraq?

Take a listen.


WOLF BLITZER, CNN ANCHOR: How do the United States get out of this situation?

TRUMP: How do they get out? They get out. That`s how they get out. Declare victory and leave.

Because I`ll tell you, this country is just going to get further bogged down. They`re in a civil war over there, Wolf. There is nothing that we will be able to do with a civil war.


HAYES: So, but he had that view.

DELGADO: Right. I don`t see how that`s inconsistent, saying we should get out, but then disagreeing with the method by which we got out, i.e., not leaving --

HAYES: That`s very clear. He said they`re in a civil war. There is nothing, nothing we can do in a civil war. That is an articulation of the maximalist position ultimately pursued in the beginning, a position I think you probably agreed with. I think a lot of people who have your political bent on foreign policy agreed with, which is, we don`t need American soldiers sitting in the middle of a civil war over there, they should come home, right?

DELGADO: Right. We get out, but we leave some there in a managerial, advisory role. So, his position was bought the inconsistent.

HAYES: But that was not, first of all, he`s not articulating that there.

DELGADO: And Obama failed to do that. Obama got out but then left nothing there.

HAYES: But, A.J., you can`t have it both ways. I mean, the point is, it`s either proper to get out, A, B, the status of the agreement negotiated on President Bush determined the way troops could or could not stay.

DELGADO: Right, but that agreement was negotiated years earlier, and things changed.

HAYES: Right. But --

DELGADO: So, Obama should have left more troops there.

HAYES: So, then, why does Donald Trump say we should have left troops there at the time in a managerial role? He didn`t say that?

DELGADO: Are you talking about a quote from 2007, right, and the troops were taken out four years later, yes? So things change.

HAYES: Right. But he is saying we should get out all the way in 2007.

DELGADO: Yes, getting out. But that doesn`t mean not leaving some sort of managerial advisory decision there.

HAYES: Then what`s the policy of the Trump campaign? I want to understand this, is that the Americans should have changed the terms of the status force agreement or they should have foregone indemnification for American troops, which is an issue in those negotiations, so as to leave some group of American troops there that would have stopped the rise of ISIS? Do I understand that is the position?

DELGADO: I can`t speak for the campaign in that regard. My personal understanding, I do tend to agree with Mr. Trump quite often on foreign policy, is pulling out doesn`t mean violating the status forces agreement. We still would have pulled out.

But we should have as Obama himself was considering, we should have left that, 10,000 was the number, and that wasn`t done.


HAYES: The next time I talk to Donald Trump, I`m going to ask him about this number.

DELGADO: Feel free, I`m sure he`ll give you a great answer.

HAYES: Final thing, why is it so important for him to keep repeating that line, he`s the founder of ISIS, he`s the founder of ISIS, even as you say and everyone I think who understands this, it`s a figurative hyperbole.

DELGADO: Because it`s true and because Hillary Clinton is, in fact, a co- founder. This is somebody that was a cheerleader for the Iraq war for years who did a disastrous job in Libya, who wants us to intervene in Syria. The past nine interventions, Chris, military interventions, we`ve gotten into, Hillary Clinton has supported seven.

She`s a warmonger. So I hope you are Bernie Sander`s supporting viewers, I have a lot of respect for, by the way, realize there is a moral call to be made here if you vote for that woman.

HAYES: Well, Donald Trump currently said he`s going to bomb the S out of ISIS. So, we`ll see who that is.

A.J. Delgado, thanks a lot for joining me. Appreciate it.


HAYES: I`m joined by Betsy Woodruff, political reporter of "The Daily Beast" and John Harwood, former political writer for "The New York Times" and CNBC chief Washington correspondent.

Betsy, I`ve heard increasing talk of the Dole strategy. You heard Republican, politicos, sort of consultants, particularly the folks who are not attached right now to the campaign talking about the Dole strategy, which is cut your loss, spend your money down ballot. How close are we to that scenario?

BETSY WOODRUFF, THE DAILY BEAST: I don`t think that`s going to happen. The reality is Reince Priebus and John Spicer are personally invested in staying the course, sticking by their man, not abandoning Trump mid-stream. I think the fact that there is so much, you know, newfound pressure or newfound criticism of the way the RNC is handling this, actually highlights how many different little factions there are in the Republican Party right now.

I mean, the reality is some of the folks pushing the RNC, a couple dozen signed a letter published written about today, a lot of the folks who are pushing the RNC to do this are people who worked on McCain and Romney`s campaign. It`s not people even from the last successful presidential campaign from George Bush`s 2004 effort. Just highlight how much dissonance and how unorganized even the anti-Trump cut him loose efforts are.

HAYES: And, John, the other problem here, here is Trump responding to this threat, which I thought is interesting, he says, if it`s true, that`s OK, too, because all I have to do is stop funding the Republican Party. I`m the one raising the money for them. In fact, right now, I`m in Orlando, if they want to do that, they can save me a lot of energy.

There is a certain degree, which is true, which is the small dollar fundraising operation that they had stood up over the past two months is bringing in a lot of money now, that gives him quite a bit of power in this negotiation.

JOHN HARWOOD, THE NEW YORK TIMES: I don`t know about that, Chris. You know, Betsy may be right. Maybe the RNC won`t drop him. But the comments he made tonight and on our air this morning about going on a nice vacation, if he losses, does not make you think he considers himself a part of a team that is really trying to win this game.

When he`s, in effect, daring the Republican Party, saying, yes, you want to do that, go ahead. It will be a lot easier for me. Well, at this point in the race, he`s down by seven or eight points if you look at the average of national polls. Many Republicans, including people like Pat Toomey in Pennsylvania, Kelly Ayotte in New Hampshire, think that they are being pulled down by him.

I think the pressure for Republicans as you see more and more repudiating him to drop Donald Trump is going to increase and it doesn`t seem like Donald Trump cares all that much.

HAYES: You mentioned Kelly Ayotte. I`ve seen picture of her of people running after her with Trump masks, which is literally embodying the problem she has.

Betsy, the other thing to me, is, God, if you are Reince Priebus, if you are down ballot Republican, I mean, we`re not just -- we are talking Senate races, but it cascades down. South Carolina is going to be a two-point margin, there are going to be state senators and state reps and maybe council people and a lieutenant governor swept up in that kind of level of electoral massacre, that that is bigger than the six, seven races.

WOODRUFF: I think it`s plausible, certainly not guaranteed, that 2016 can become sort of an inversion of 2010, when we see a down ballot effect that`s so powerful, that the Republican Party has a mass of trouble putting itself back together. Now, if you talk to Republican operatives, what they`ll tell you is their last shred of hope comes from the fact that Democrats haven`t been recruiting a year ago, a year and a half ago to get candidates who`d be competitive, for instance, in the South Carolina gubernatorial race. I`m not sure who running is, plausibly, smart people. But that`s not where Democrats have been investing.

So, if Democrats had been spending significantly more, if the DNC has been investing significantly more say in Texas, say in Georgia, it might be even more of a blood bath for Republicans than it will be right now. That said, I mean the Georgia number, especially, are kind of gob smacking.

HAYES: John, that quote that you identified, it struck me so much on CNBC`s air, if you are listening to Reince Priebus or Mike Pence or anyone else, he`s basically sounding like he`s already resigned himself, hey, if we do another 90 days, I`ve got to fly around, it`s sort of pain my butt, anyways, that is not particularly encouraging.

HARWOOD: Definitely not. Look, I talked to a Republican member of Congress earlier this week and asked about, what are your members going to do? And the answer was, this is a team sport. We need to hang in with the guy who is leading our team but if members of Congress come to believe that he does not feel he is a part of a team, and he is not particularly invested in fighting this game to the last inning or the last quarter you want to pick, I think there is a danger that more and more are going to walk away from them.

Look, you had all those Republican national security officials signing that letter. You had people like Carlos Gutierrez and former Reagan political director Frank Lavin signing a letter saying they`re not for him anymore. You`ve had Hank Paulson and Brent Scowcroft saying they`re against him. The more defections you get on the Republican side, the more potential for a snowball effect.

HAYES: All right. Before we go, here`s that picture of Kelly Ayotte, this will haunt your nightscapes right there.

Betsy Woodruff and John Harwood -- thank you very much.

Coming up, what do people like least about Donald Trump? There is one thing Trump did in this campaign that more than eight in ten voters agree is not OK.

First, the conspiracy theory built on the right that President Obama is not a bad leader but an enemy of the state. That`s next.



TRUMP: ISIS is honoring President Obama. He is the founder of ISIS. He`s the founder of ISIS, OK? He`s the founder. He founded ISIS.

And I have been saying that Barack Obama is the founder. He is the founder in a true sense.


HAYES: Donald Trump is clearly pretty proud of this line, a line that is obviously patently and viciously untrue. But it`s more than sloppy wording, I think, or rhetorical flourish. It is part of a long case conservatives and Donald Trump in particular has been building, that Barack Obama is not just a president they disagree with, he is fundamentally foreign, he is an other, possibly allied with the enemies of the United States.

Remember, first, there was birtherism and Donald Trump was eager to jump into the league.


TRUMP: People are trying to figure out why isn`t he giving his birth certificate. It`s not a birth certificate. I just say very simply, why doesn`t he show his birth certificate?


HAYES: There were suggestions President Obama labeling him the apologizer in chief wants to deliberately diminish America`s power on the world stage. Here`s one example, Marco Rubio repeatedly in the Republican primary.


SEN. MARCO RUBIO (R-FL), THEN-PRESIDENTIAL CANDIDATE: It became abundantly clear was this, Barack Obama was deliberately weakening America. He made an intentional effort to humble us back to size as if to say, we no longer need to be so powerful because our power has done more harm than good.


HAYES: Trump`s political ascendancy during the primary season brought back the more blunt suggestions of President Obama`s true allegiance, something Donald Trump discussed just one day after the Orlando mass shooting.


TRUMP: We are led by a man that either is -- is not tough, not smart, or he`s got something else in mind, and the something else in mind, you know, people can`t believe. People cannot -- they cannot believe that President Obama is acting the way he acts and can`t even mention the words radical Islamic terrorism. There`s something going on.


HAYES: There`s something going on. That`s the fuller context of Trump last night, repeated again and again and again today, saying President Obama is the founder of ISIS.

Joining me is Sabrina Siddiqui, political reporter for "The Guardian".

Sabrina, I feel like you know, there`s -- people have been throwing examples out of hyperbole that Democrats have used, Chris Murphy saying the Republicans have decided to sell weapons to ISIS, when talking about the assault weapon ban, and then, true, that is hyperbolic and I think, myself personally sort of wrapped him on the knuckle with that rhetoric.

But what`s key to me is the context here of this statement, last night, it was very interesting, he said, Barack Hussein Obama in the midst of that. What`s the context here as you see it as someone who sort of covered this and written about it?

SABRINA SIDDIQUI, THE GUARDIAN: Well, the fact of the matter is that Donald Trump is vocalizing what many Republicans have this up to the line and not specifically said. It goes back to what you were just pointing out, that the concept here is that this president, who is the first African-American president in the United States is not in essence American, that he`s foreign, that he`s secretly a Muslim when he`s, in fact, a Christian.

I mean, think about Donald Trump`s history of problems with respect to this president. This is not one statement that happened in isolation. Of course, in 2011, 2012, he was spending his time really pushing the birther conspiracies, claiming to spend private investigators to Hawaii to track down President Obama`s birth certificate. When the attack happened in Orlando, Donald Trump said that maybe President Obama actually understands terrorism all too well, implying that he`s some kind of sympathizer.

And, of course, when President Obama went to a mosque, I said Donald Trump said maybe he feels comfortable there. So, this is part of a patent of remarks that speaks directly to Donald Trump`s base of supporters. And it goes back to a campaign that is fundamentally rooted in nativism.

HAYES: And shockingly, I mean, keep in mind, even to this day, the a shockingly high percentage of Republicans believe the president has lied about his birthplace, isn`t American or is secretly Muslim, despite the fact that he`s a Christian. That`s a belief held. You can say, well, that`s -- you know, Donald Trump doesn`t talk about the birtherrism anymore, when he says Barack Hussein Obama is the founder of ISIS, that is being injected into a set of folks who already have views of the president that he is essentially been lying, that these a fifth column. That he`s an enemy of the U.S. who is sort of lying to all of to us bring the country down.

SIDDIQUI: And I think that`s precisely because it`s not just Donald Trump. So, as I was pointing out, a lot of Republicans imply some of these things without actually going out and saying in the way that Donald Trump says that the president is actually a terrorist sympathizer.

So, you remember John McCain, for example, when the Orlando shooting happened, initially said the president was directly responsible for that attack at the LBGT nightclub. And then he had to immediately walk it back because this is now being s linked to, quote/unquote, "Trumpism". You know, Republicans have been obsessing with the fact that President Obama doesn`t use the phrase radical Islam and he talks about terrorism. That`s been their central talking point when it comes to how he`s handled this threat that is posed by ISIS.

So, you know, President George W. Bush also didn`t use the radical Islam. But you never saw them protesting then. It goes back to not just questioning whether the president has handled the war against terror appropriately, but whether or not he even thinks that, whether or not he sympathizes, even takes seriously the threat that`s posed by Muslim extremists so to speak.

HAYES: All right. Sabrina Siddiqui, thank you. Appreciate it.

SIDDIQUI: Thank you.

HAYES: Coming up, Hillary Clinton said today, Trump has made a career out of stiffing small businesses. We`ll show you one small business Trump tried to stiff but lost. That`s next.



TRUMP: I have many, many properties in Florida. In Miami, we develop great, great developments.

We own Doral, which is one of the great places in the world. I think it`s the greatest resort or just about. I bought it and I had a choice. I said, we can do the A job, the B job, the C job or the D job. We could even do the F job and that was leaving it alone.

But we blew it up and we did the A-plus job. And we did the right thing. And we did the right thing.


HAYES: We did the right thing. That was Donald Trump speaking if Florida yesterday about his purchase and renovation of the historic Doral golf club in Miami. Of course, it has hosted PGA events the past 55 years.

There are a whole slew of people who say Trump didn`t do the right thing when it comes to the golf course, especially contractors who say they got stiffed by Trump. According to "Miami Herald" on Tuesday, the Trump golf club was hit with its 23rd lien by a construction firm who said they are still owed over $200,000 by Trump`s company. That`s after filings from 22 other contractors and subcontractors claiming Trump`s company failed to pay their contracts in full.

Trump`s business attorney told "The Herald" on a project of this magnitude, with hundreds of contractors, 20 liens isn`t a great deal. What is important is the fact that things are getting paid.

And then it didn`t seem like Trump is trying to settle up, perhaps they just can`t write checks fast enough. But here`s what the process looks like for just one of those 23 contractors.

All right. Trump had a $200,000 deal with the paint spot, it`s a local, independently owned small business in Miami. And after the renovation of Doral, the paint spot said it was still waiting for Trump`s company to pay the final $34,000 from the paint contract. The owner, Juan Carlos Enriquez, sued and spent more than two years in court.

According to court testimony, the manager of the general contractor for the Doral renovation admitted that a decision was made not the pay the paint spot because Trump, and I`m quoting here, already paid enough. OK.

So, this past May, Miami-Dade Circuit Judge Jorge Cueto ruled in favor of Enriquez, ordering Trump`s company to pay or the Trump Doral golf course would be foreclosed. Judge Cueto even filed the paperwork for a 9:00 a.m. foreclosure sale of the golf club in June.

A week later, more bad news for Team Trump, PGA announced it was pulling its tournament from Doral golf course, saying it couldn`t find a sponsor. Now, Trump eventually fought off foreclosure by placing the $34,000 he owed in escrow.

But it doesn`t end there, the judge ruled last month that Trump`s company would have to compensate the paint shop for its legal fees to the tune of $300,000. Last week, Trump`s lawyers filed an appeal.

Again, this is a story of one of the 23 contractors from one of Donald Trump`s properties. And in this one case, Trump risked foreclosure of the property he bought for $150 million in order to withhold $34,000 from a small local paint shop. For the guy that makes the best deals, Trump is now facing nearly the $300,000 in legal fee, more than the entire original contract with the Miami paint supplier.

Today in Michigan, Hillary Clinton said Trump has a history of trying to stiff small businesses, she made it personal. We will play that after the break.



CLINTON: My grandfather worked at the Scranton lace mill in Scranton, Pennsylvania for 50 years. And because he worked hard, my dad was able to go to college and eventually start his own small business and then send me out into the world to follow my own dreams.

No matter how far those dreams have taken me, I have always remembered I am the daughter of a small business owner and the granddaughter of a factory worker and proud of both.


HAYES: Hillary Clinton did two things today in her big economic speech in Michigan. One, she went head on at Donald Trump`s populist appeal by portraying Trump`s economic plan as a destructive agenda designed to benefit the rich. And, two, she`s talked to some of the more liberal policy position she`s adopted during the Democratic primary.


CLINTON: I will stop any trade deal that kills jobs or holds down wages, including the TransPacific Partnership. I oppose it now, I`ll oppose it after the election. And I`ll oppose it as president.

Strengthening unions doesn`t just serve members, it leads to better pay and benefits and working conditions for all employee. Giving Americans in every state the choice of a public option health insurance plan that will help everybody afford coverage. It will strengthen competition and drive down costs.


HAYES: Clinton also talked about expanding social security, free college tuition, raising the minimum wage, making corporations pay higher taxes.

Mind you, she said this in the middle of the general election when candidates are at this point more likely to pivot toward the center, and while her campaign reportedly continues to court prominent Republicans and independents.

Joining me now is Allen Kruger. He`s former chairman of President Obama`s council of economic advisers who has advised Hillary Clinton on economic issues.

Allen, for those who are skeptical of Hillary Clinton on the TPP and you worked for President Obama, why should people believe that she will oppose it or fight hard to make sure it doesn`t pass in a lame duck session when the president, the man that you worked for, wants it so badly?

ALLEN KRUGER, FRM. CHAIRMAN, COUNCIL OF ECONOMIC ADVISERS: I think she`s been consistent that she wants trade agreements that lead to better jobs, higher wages and that promote our national security interests.

HAYES: Let me ask you this about the fundamental issue here with the economy. The fundamental issue, it seems to me, we have had record long recovery, record number of months of private sector job growth. We are seeing now unemployment coming down, wages are finally going up. It`s this distributional question, right, gains are not getting to the median worker. Household wages have been stagnating. What can Hillary Clinton do about that if she is president of the United States?

KRUGER: First of all, those problems are not unique to this recover, they had been going on for some time, for over 30 years. And I`m concerned that the longer they go on, the harder they become to solve, because higher inequality reduces social mobile. So it creates something of an inequality trap.

A number of the things that Secretary Clinton has proposed I think will help to reduce inequality and probably do so quickly -- raising the minimum wage, for example, having a smart credit for child care.

One idea she had, which she borrowed from Republicans, going back to Jack Kemp, is the new markets tax credit, which I also think would help to reduce inequality and help to provide more opportunity and lower income areas.

HAYES: What is that?

KRUGER: The new markets tax credit gives a strong incentive for companies to invest in specific areas. And you can define the areas the way you like. And experience with it in the past has been very successful.

HAYES: There is also this question -- the thing that lurks underneath all of this, which I think is interesting. I saw this great chart about fiscal austerity. We talk about private sector job growth. One of the things that`s happened in this recovery is government has shrunk. And government jobs have gone away in a way that is not corollary to other recoveries. You see those lines there going up is normally what happens is government fills in, people are employed. It`s used to essentially as a kind of balast.

We have actually had the opposite. We`ve had austerity here.

You`ve worked in Washington, you`ve worked in the White House, is there going to be an appetite for any kind of infrastructure, public sector expansions of the public sector given Republican opposition? Is that realistic?

KRUGER: Well, I hope Republicans come around. You know, there is no Republican or Democratic road, its just an American road. And Secretary Clinton`s proposed the biggest expansion of investment in infrastructure since Eisenhower. I think it makes a great deal of sense given the state of our infrastructure today, given that unemployment still remains high for construction workers, and given that it will raise our competitiveness and productivity in the future.

HAYES: Given that treasuries are trading -- are clearing in auctions at 1 percent, and sometimes, depending if things get panicky in short-term they will even go negative, the fact that there are such low interest rates, why does Secretary Clinton have everything net out and be deficit neutral? Shouldn`t we still be taking advantage of the incredible opportunities of these low interest rates for big investments and not be worrying about deficits right now?

KRUGER: I think her infrastructure plan does that.

For example, today, she highlighted the infrastructure investment bank, which could be leveraged, that would be seeded with $25 billion of capital from government and then the private sector could come in and purchase bonds and finance these projects in other ways, potentially raising $250 billion or more she mentioned today to invest in our infrastructure.

And I think that`s an excellent way of taking advantage of the low rate environment we have today to rebuild America.

HAYES: All right, Allen Kruger, thanks for joining us. Appreciate it.

KRUGER: Thanks for having me, Chris.

HAYES: Coming up, Trump`s impact on Republican senate races. How it spawned perhaps the most devastating ad of the cycle. You really have to see this one.

Plus, why the Clinton campaign has made this moment a major part of their attack strategy against Trump. That`s ahead.


TRUMP: I don`t rember, maybe that`s what I said.



HAYES: Thing one tonight, there is no escape from Trump effect for incumbent Republicans. And to prove it, all you have to do is look at contested down ballot senate races across America.

Take a look at a few examples. Right now, Republican Senator and former presidential candidate Marco Rubio,. also former future private citizen, is in a too close to call race in Florida.

Latest Quinnipiac University poll of likely voters shows Rubio with a slim 3 point lead over Democratic U.S. Congressman Patrick Murphy.

Now last month`s Q poll of registered voters showed Rubio ahead by 13 points.

We should note the most recent poll surveyed likely voters, last month`s surveyed registered voteres. So not quite apples to apples, but still pretty brutal. Rubio has, of course, endorsed Trump, but has been keeping his distance from him on the campaign trail.

Moving up the map to Pennsylvania, Democrat Katie McGinty is leading Republican senator Pat Toomey by three points in the latest Quinnipiac University poll. Earlier in the summer in the same poll, Toomey was leading McGinty by 10 points.

Now, Toomey has not yet endorsed Trump, saying he`s in a mode waiting to be persuaded, whatever that means.

Let`s keep going north to New Hampshire. Where Republican Senator Kelly Ayotte is currently trailing 10 points behind Democratic Governor Maggie Hassan, in a new WBUR poll. In that same poll in May, Ayotte was 2 points behind Hassan.

Ayotte says she will vote for the nominee despite voicing disagreements with him.

There`s perhaps an even better example than the ones I`ve just given you about what the Trump effect does to people. And that is thing two in just 60 seconds.


HAYES: OK, thing two tonight, it is rough out there for Republican incumbents who find themselves sharing a ballot with Donald Trump at the moment.

They face endless questions about his latest outrage, poll numbers continue to plummet. Perhaps the best illustration comes in the form of an ad from Senator John McCain`s opponent, Democrat Ann Kirkpatrick.


ANNOUNCER: John McCain has pledged to support Donald Trump over 50 times.

SEN. JOHN MCCAIN, (R) ARIZONA: I will support the nominee of the party.

I would support the nominee of the party.

I`d vote for the Republican nominee.

TRUMP: Never been a big fan of John McCain. I just hate the way our veterans have been treated by John.

I like people that weren`t captured, OK.

ANNOUNCER: Trump even tweeted, "Senator John McCain should be defeated in the primaries. Graduated last in his class at Annapolis. Dummy."

MCCAIN: Hello. I said I support the nominee.

TRUMP: If she gets to pick her judges, nothing you can do, folks. Although the Second Amendment people, maybe there is, I don`t know.

ANNOUNCER: 50 times.

UNIDENTIFIED MALE: Are you comfortable with Donald Trump possibly having control of the nuclear arsenal?

MCCAIN: I -- anyone that...

I support the nominee of the party. If I change my mind, I`ll let you know.

ANNOUNCER: The only thing that`s changed is John McCain.

REP. ANN KIRKPATRICK, (R) ARIZONA: I`m Ann Kirkpatrick, and I approve this message.


HAYES: Ouch.

In case you`re wondering, Kirkpatrick is leading McCain by 2 points in the latest survey from the Democratic leaning pollster.

McCain might not e able to maverick his way out of this one.



CLINTON: Today, we face a choice about who we are as a nation.

TRUMP: I`d like to punch him in the face, I tell you.

TRUMP: Do we help each other?

TRUMP: Knock the crap out of him, would you? Seriously.

CLINTON: Do we respect each other?

TRUMP: You see this guy? Oh, I don`t know what I said, I don`t remember.


HAYES: Hillary Clinton used Donald Trump`s own words against him in her first campaign ad of the general election way back in June. And that last clip you just saw of Trump shows him mocking a New York Times reporter who has a congenital condition affecting the joints, found its way into another ad, perhaps Clinton`s most brutally effective one against her opponent featuring children watching the Republican presidential nominee insult and attack people, including that reporter with a disability.

The pro-Clinton super PAC Priorities USA released a pair of ads echoing a similar theme. One, featuring the parents of a child with a disability describing how they felt watching Trump mock that reporter.

Another, featuring a child, disabled from a rare form of cancer on his spine, explaining his feelings on Trump`s attacks.

The Democratic National Convention in Philadelphia last month, of course, presented a whole wide variety of character attacks on Donald Trump, from a former Trump University student who said she was conned by Trump`s for- profit enterprise, to a member of congress accusing Trump of cashing in on 9/11 recovery money to, of course, the Khan family announcing Trump`s proposal to ban Muslim immigrants and calling into question Trump`s own sacrifices for this country.

And also very prominently featured were people with disabilities, partly to make the -- mark the anniversary of the Americans with Disabilities Act, to emphasize Hillary Clinton`s own work with people with disabilities, but also to call out Donald Trump for mocking that reporter.


ANASTASIA SOMOZA, DISABILITY RIGHTS ADVOCATE: We all know Donald Trump has shown us who he really is and I honestly feel bad for anyone with that much hate in their heart. Donald Trump doesn`t see me. He doesn`t hear me and he definitely doesn`t speak for me.


HAYES: Out of all the objectionable things Donald Trump has said out of all the issues to attack him on, Hillary Clinton, the Democratic Party, have focused pretty hard on this one, today we just got a pretty clear answer as to why and that is next.


HAYES: There`s an entire collection, of course, of Donald Trump controversies out there. Hillary Clinton and Democratic Party have jumped on a number of them, perhaps one attack on Donald Trump is resonating more with voters than others.

So, a really interesting poll out from Bloomberg, and it asked likely voters if they were bothered by a number of controversies and statements Trump has been responsible for over the course of the campaign. 75 percent of voters said they were bothered by Trump`s assertion at the RNC that he alone can fix America`s problems, 75 percent of voters said they were bothered by Trump`s repeated attacks on the family of a fallen soldier. But the one thing that bothers people the most about Donald Trump, a whopping 83 percent of voters say they were bothered by Trump`s mocking a reporter with a disability: 62 percent said they were bothered a lot by that particular Trump insult.

As for the candidate, himself, he denied mocking the reporter`s disability just last month.


TRUMP: I had no idea what he looked like. He said he met me, and I knew. He said he met me in the 1980s. I had no idea.

I spend millions of dollars making buildings good for people that are disabled, OK, millions and millions of dollars. Do you think I`d ever do a thing like that?

What I was indicating a man that was groveling. He was groveling to try and change the story that he had written many years before so that it worked out badly for Trump.

So I do that, they said I was mocking his disability. I had no idea that he was disabled. None.


HAYES: Joining me now, Liz Plank, senior correspondent for Vox, and Cornell Belcher, former pollster for the DNC, president of Brilliant Corners Reserach strategies. It`s great to have you both.

I should note the Americans With Disabilities Act requires you through federal mandates to build ramps and so forth.

LIZ PLANK, VOX NEWS: And he has been sued many times for not complying with the law.

HAYES: That`s right.

PLANK: Many times.

HAYES: Many times been sued for not doing that.

So you don`t get any points for obeying federal law.

Cornell, let me start with you on the polling, I was sitting in the DNC, and I`m watching it over four days. And they keep hammering this. And I keep thinking to myself, yeah, that was a really gross moment in the Trump campaign, but it was one moment and in the panorama of things the guy has done, it got a ton of attention. And then I saw this polling, I was like, OK, well, I bet you they did some polling on this also.

CORNELL BELCHER, FRM. DNC POLLSTER: You think? I think they maybe did a little bit.

You know, one of the things that`s important here is the temperament to be president, right? I mean, that the a driving trait this cycle on the presidential choice. And this idea that he is mean-spirited, he doesn`t have the temperament to be president, he is a bully, is particularly problematic, and it`s particularly problematic with women.

I mean, this is a target, targeted right at sort of driving a wedge between Donald Trump and women, in particularly independent women.

I mean, look, one of the things about President Obama that even some, a slight number of Republican women, would admit to in 2008 was, you know what, this guy is a role model. I might not like his policies, but he`s someone that as a role model, you can look up to as kids. There is not a woman in the country who could argue that Donald Trump is a role model, someone that their kids could look up to.

I think this is a devastating attack particularly for women.

HAYES: Well, Liz, you have done -- one reason I want you here tonight, you have done phenomenal reporting all cycle on people with disabilities. It`s been something have you done for a long time. Does it hearten you to see this polling?

PLANK: Yeah. I think it`s a great sign, but I`m not surprised. I mean, people with disabilities make up one in five Americans, it`s a huge -- it`s the fastest growing minority of people. And every -- it`s the only demographic or any one of us could one day join, right?

HAYES: This is so key, I think -- you know, you can attack Muslims and there are folks in America who maybe don`t know a single Muslim or there`s some other group or attack -- immigrants.

This is, we`re talking about folks everything from people with congenital illnesses to people that were in car accidents, everyone -- to veterans. I mean, everyone has someone in their life that has struggled with this.

PLANK: Exactly. And even if you haven`t, you see this as just plain wrong. And it`s not just one moment in Donald Trump`s career, life where he`s done something offensive to people with disabilities. I mean, this is the second time he has mocked a reporter with a disability. He mocked Charles Krauthammer a year ago in an interview with Katie Tur.

He`s also written a book called "Crippled America," which is a slur for disability. He`s been sued many times because of the ADA. His casino in - - Taj Mahal casino, basically, I mean, the DOJ had to actually intervene to make sure that it was accessible

HAYES: That they were ADA client.

PLANK: Exactly. Because you couldn`t even get into the building if you had a disability.

So -- and then when you talk to people living with a disability, they will tell you that Donald Trump when he says I give money to people living with a disability. So, I am doing the right thing.

They don`t want his charity. They don`t want his money. They want policy.

HAYES: I want to play this interview you did with two women with disabilities as part of a piece you did for Vox. Take a listen.


UNIDENTIFIED FEMALE: There`s so much power in being disabled. The little hurdles that we go over, they`re humongous.

UNIDENTIFIED FEMALE: We are a part of the future, and that`s the world that they create, you know, then we should be first in line.


HAYES: One interesting thing about that video, Liz, was that talking to those folks, it was a little like you can see people`s political consciousness formed by being attacked.

PLANK: Right.

HAYES: They were aware that Trump has done this, it was in their conscious as well.

PLANK: And disability before this election was not a partisan issue.

HAYES: Exactly.

PLANK: I mean, it`s become a partisan issue, because you have one party, right, you were talking about the DNC, the visibility of people with disabilities. I mean, even Hillary Clinton`s campaign buttons had braille, were able to -- I mean, there was a man -- it was just the visibility was amazing.

And then you have another party that`s embarrassing people with disabilities. That`s not even -- you know, showing policy, but that`s treating them as lesser than humans.

HAYES: And Cornell, we should keep in mind, George H.W. Bush signed the ADA. As Liz was saying this is -- I mean, this is not to like fault line in American politics, right. There`s all sorts of stuff that we fight about -- abortion, right, we sort of -- marginal tax rates, the minimum wage. This is not this has not traditionally been up with of them. You worked in politics for a while. It`s not something you fight about generally in a political campaign.

BELCHER: It was a major stumble, although it showed his character. But they jumped on it because it`s really unique.

Look, for better or worse, you know, there are divisive fault lines that benefits you in American politics for going after Latino Americans, for going after African Americans, for going after gays -- gay and lesbian American, for going after Muslims. There is a percentage Americans that -- in your base that that will actually help with you on that division.

There is no dividing line around attacking people with disabilities. It is not partisan. There is no constituency out there that says, you know what, I`m afraid of those with -- people with disabilities.

HAYES: All right, Liz Plank, Cornell Belcher, thank you both for joining us tonight. I appreciate it a lot.

All right, that is All In for now, but just for now. We`re going to be back again tonight, two hours. Live at 11:00 eastern. You do not want to miss that.