HUD Sec. struggles to answer questions on his agenda Transcript 10/24/17 All In with Chris Hayes

Guests: Sheldon White House, Gordon Humphrey, Mickey Edwards, Michelle Goldberg

Show: ALL IN with CHRIS HAYES Date: October 24, 2017

Guest: Sheldon White House, Gordon Humphrey, Mickey Edwards, Michelle Goldberg

CHRIS MATTHEWS, MSNBC HOST: And that`s HARDBALL for now, thanks for being with us. "ALL IN" with Chris Hayes starts right now.



SEN. BOB CORKER (R), TENNESSEE: I think the basement of our nation will be what he will be remembered most for.

HAYES: Retiring Republicans light up their own party`s president.

SEN. JEFF FLAKE (R), ARIZONA: I have children and grandchildren to answer to. And so Mr. President, I will not be complicit or silent.

HAYES: All the fallout from today`s remarkable rebuke of Donald Trump and what if anything happens next?

UNIDENTIFIED MALE: Do you think Congress should pursuing every avenue to get President Trump out of office?

HAYES: Then Democrats break out the ObamaCare playbook on taxes.

SEN. CHUCK SCHUMER (D-NY), MINORITY LEADER: The President said this is not a plan for the rich, blatantly untrue.

HAYES: New questions about why the Trump White House won`t implement Russia sanctions.

UNIDENTIFIED MALE: Trump is treason! Trump is treason!

HAYES: And new concerns over a trump-connected company hired to fix power in Puerto Rico.


HAYES: When ALL IN starts right now.


HAYES: Good evening from New York, I`m Chris Hayes. It was an extraordinary day in Washington. Two sitting Republican Senators went before the American people to denounce the President of the United States, the head of their own party as an unstable and unfit leader who endangers the country and debases our democracy. And after deciding to retire at the end of this term, Senators Bob Corker and Jeff Flake gave a dramatic tribute to not just the President but crucially to their own Republican colleagues. The day started with Corker, who`s been vocal about his concerns since announcing his retirement last month talking to just about every T.V. camera he could find about the man in the Oval Office.


CORKER: For young people to be watching not only here in our country, but around the world, someone of this mentality, or as President of the United States is something that is I think debasing to our country.

The President has great difficulty with the truth on many issues.

UNIDENTIFIED MALE: Do you regret supporting him in the election?

CORKER: Let`s just put it this way, I would not do that again.

UNIDENTIFIED MALE: So you wouldn`t support him again?

CORKER: No way.


HAYES: Those comments were the backdrop for a highly anticipated appearance by the President today at the weekly Senate Republican lunch where he and Corker would come face to face. Now by all accounts, that meeting came and went without fireworks, the President focusing instead on what he described as his administration`s list of accomplishments. GOP leadership emerged for the launch proclaiming party unity and a common vision for their upcoming tax plan. So no one was expecting what happened just minutes later when news broke that Jeff Flake, like Corker, had decided not to run for re-election. And Flake took to the Senate floor to condemn the President`s conduct and to confront his own colleagues for their own complicity.


FLAKE: There are times when we must risk our own careers in favor of our principles, now is such a time. Reckless, outrageous and undignified behavior has become excused and countenanced as telling it like it is when it is actually just reckless, outrageous, and undignified. And when such behavior emanates from the top of our government, it is something else. It is dangerous to a democracy. With respect and humility, I must say that we have fooled ourselves long enough that a pivot to governing is right around the corner, a return to civility and stability right behind it. We know better than that. By now we all know better than that. The notion that one should stay silent as the norms and values that keep America strong are undermined and as the alliances and agreements that ensure the stability of the entire world are routinely threatened by the level of thought that goes into 140 characters, the notion that we should say or do nothing in the face of such mercurial behavior, is ahistoric, and I believe profoundly misguided. I have children and grandchildren to answer to.

And so, Mr. President, I will not be complicit. It is also clear to me for the moment that we have given in or given up on the core principles in favor of a more viscerally satisfying anger and resentment. The impulse to scapegoat and belittle threatens to turn us into a fearful, backward- looking people. In the case of the Republican Party, those things also threaten to turn us into a fearful, backward-looking minority party.


HAYES: A number of Republican Senators were there in the chamber for that speech from Jeff Flake, and they all reportedly stood and clapped with the exception of Rand Paul. And John McCain, Flake`s colleague from Arizona and a fellow critic to the President offered a tribute to Flake`s character and his service to the country. As for Senate Majority Leader, Mitch McConnell who`s been struggling to stay on the President`s good side since they squabbled openly over the summer, it`s not real clear he got Flake`s message.


SEN. MITCH MCCONNELL (R-KY), MAJORITY LEADER: I`m grateful that the Senator from Arizona will be here for another year and a half. We have big things to try to accomplish for the American people. But from my perspective, the Senator from Arizona has been a great team player.


HAYES: Senator Sheldon Whitehouse is a Democrat from Rhode Island. Senator, did you know this was all happening today?

SEN. SHELDON WHITEHOUSE (D), RHODE ISLAND: No, the Flake announcement came as a bolt from the blue, and we knew that Senator Corker had been boiling with distaste for President Trump for a while, but I for one did not see the various statements that were made today coming. I think that when you have Senators of a President`s party talking about the President debasing the nation and degrading the country, that is unprecedented stuff.

HAYES: It felt that way to me watching and I`m curious if it felt to you like something shifted today.

WHITEHOUSE: I think so. You have to understand how highly regarded both Bob Corker and Jeff Flake are on both sides of the aisle in the Senate. These are known as principled, thoughtful, respectful people. And so, particularly coming from them, I think this has broad impact and it forces other Republicans to confront the question will I now start to say more publicly what I`ve been thinking for a while or will I continue to be complicit in going along with this President.

HAYES: What did you make of -- I thought Mitch McConnell`s response was sort of fascinating because he said basically, you`re a good man and a team player, right? Which seemed to me -- seemed to me a kind of check-in, like we still got a yes from you on tax stuff, right?

WHITEHOUSE: Well, that`s their next big immediate goal as they walk into another back box canyon and can`t get their billionaire-friendly tax reform done, then big donors are going to go ape and they`re going to have a real problem on their hands holding things together. So the tax reform for them has a little to do with tax reform, a lot to do with donor maintenance and even more to do with trying to put some kind of win on the board, however ugly it may be.

HAYES: And that`s why today felt a little bit like -- it feels like -- it feels like a twig right before it snaps a little bit. There`s a sort of tension in it.

WHITEHOUSE: Yes, but --

HAYES: Yes, go ahead.

WHITEHOUSE: I was going to say the door kind of cracked open. And now we`re going to see how far it swings. You know the famous song, freedom is just another word for nothing left to lose? When you have Bob Corker and Jeff Flake who aren`t running again and others who may not be running again, they`re now free to speak their minds. And the traditional political pressure is that a majority leader or a president can bring to bear to silence them and line them up simply don`t work any longer. And I think again, both Corker and Flake are senators of real conscience, so good luck pushing them around. It didn`t work when you could hold election strategies over their heads, it certainly isn`t going to work now.

HAYES: It`s also striking to me about Flake`s age. I mean, he`s only 54- years old. In the -- in the gerontocratic world of the United States Senate, that`s just quite a young pup, and this is someone with probably very bright political future, years and years of elected office ahead of him. Although he`s going to have a hard time in that primary fight if he stuck it out. What do you make of this decision?

WHITEHOUSE: I think this generally was a decision on principle. I think Jeff is a very committed principled conservative who has a considerable distaste for the way the President is handling himself. I think he was sincere, about referring to his children and grandchildren. And who knows, in another six months or another 18 months, we could be in a situation where the President has degraded the country so badly and degraded himself so badly that to Republicans Jeff Flake will look like a hero, and not somebody who has just first to flee a sinking ship.

HAYES: I think that is a very (INAUDIBLE). Senator Whitehouse himself is 62, it doesn`t look like he`s over 60, also a young pup in this United State Senate. Thank you for making time tonight.

I`m joined now by former Republican Congressman, Mickey Edwards of Oklahoma and former Republican Senator Gordon Murphy of New Hampshire, now an Independent. And I`ll start -- I`ll start with you, Senator Murphy, what did you make of that -- what we saw on Capitol Hill today?

GORDON HUMPHREY, FORMER SENATOR, NEW HAMPSHIRE: Thank you. Chris, the name is Humphrey.

HAYES: Humphrey, sorry, I`m sorry. I had Chris Murphy on the program so much, the name is tripping off my lips.

HUMPHREY: Well, it doesn`t matter that much. Listen, I think the story is as much about Donald Trump as it is about Jeff Flake and Bob Corker. This is a vivid example of the bad driving out the good. And I think it`s high time that a majority of Republicans join with Bob Corker and Jeff Flake and denounce the President as a man who is reckless, so reckless and careless and cruel in the conduct of his office as to be vile and corrupting of the American system. And it`s high time that Congress with the encouragement of former members of Congress may I say, and former presidents especially invoke the 25th amendment to remove this man from office because he is simply unfit to discharge the powers and duties of that office. Those are the words of the constitution. The President doesn`t have to be stark raving mad, if he`s vile, if he`s vicious, if he`s reckless, if he`s dangerous, that makes him unfit. And that is the description of Donald Trump.

HAYES: Mr. Edwards, is that where you`re at as well and your thinking about both what we saw today from Corker and Flake and your judgment of where this President is at?

MICKEY EDWARDS, FORMER CONGRESSMAN, OKLAHOMA: Well, Chris, it does. But I`m bothered by the correct term you used at the beginning of the show when you referred to this as extraordinary. So by my count, we have three members of the Republican Party and the U.S. Senate. Corker and McCain and now Jeff Flake who have done this. You have three more, Rand Paul, Lisa Murkowski, and Susan Collins, who are willing to sometimes vote against the President. Where are the other 46 Republican Senators? You know, it is a shame that it takes somebody who is leaving office --

HAYES: Right.

EDWARDS: -- who is not going to face the voters again to do this. The other 46, running again or not running again have an obligation to do just what Gordon Humphrey just said, what Flake has said, what Corker have said. The President really needs to be -- the constitution says that it is the job of the Congress to serve as a check on the executive. And the members of Congress need to take that seriously. They take an oath. We all took - - Gordon took it, I took it. You take an oath to defend and protect the constitution, which means independent judiciary, it means free press, it means those kinds of principles that are at the heart of our government. And these Republican members of Congress need to stand up to the President and do their job.

HAYES: I want to play for you a moment because it pertains to what you both just said about the constitutional duties of the Congress. Senator Flake talked about article one, reclaiming the article one power, take a listen.


FLAKE: Here today I stand to say that we would be better served, we would better serve the country by better fulfilling our obligations under the constitution by adhering to our article one, old normal, Mr. Madison`s Doctrine of Separation of Powers.


HAYES: Mr. Humphrey, short of the 25th amendment and invocation of that, is there -- what do you think can be done by Corker, Flake and others who feel this way?

HUMPHREY: Look, we need to be rid -- the nation needs to be rid of this vile President whose vileness is so great as to personify evil. We need to be rid of this man and Congress has the power to do that under the constitution by invoking Section 4 Article of the 25th Amendment to the Constitution which would transfer -- strip the President of his powers and transfer them to the Vice president.

HAYES: I just want to be --

HUMPHREY: This need to be done. There isn`t a moment to lose. Members of Congress need to stand up and show some courage and some principle and put the country and its future and our hopes ahead of their selfish personal political ambitions.

HAYES: Mr. Edwards, do you -- can you imagine a scenario in which there were members of the Republican Party and the United States Congress who were not retiring saying things like this given what the political incentives are?

EDWARDS: Well --

HUMPHREY: I`m hoping Senator -- I beg your pardon.

HAYES: Sorry, Mr. Edwards first.

HUMPHREY: I`m hoping that --

EDWARDS: Part of this --

HAYES: Go ahead, Mr. Edwards.

EDWARDS: Part of it is that we have a system through our primaries and the parties that give extra voice and extra strength to the more extreme elements in the party. So there are going to be people who are hesitant, who care more about their re-election than they do about the good of the country who are not going to do what they need to do. But impeachment or you know, the 25th amendment, whatever we do here, it really isn`t the only other option, because the members of the Senate and the members of the U.S. House can say to the President when he -- when he says we`re going to do this, can say no, we`re not doing that. We`re not, we will pass the laws, we will determine the policies, we will tell you what they are, if you veto them we`ll override you.

You know, we`re going to make you irrelevant as you deserve to be because nobody who lacks the intelligence, the competence, and the decency that this President has ought to be able to call the shots. The members of Congress need to stand up and say we`re the first branch of the government, it`s our constitutional obligation to decide what the country`s laws are and we`re going to do it.

HAYES: I can`t wait for this conversation, gentleman, wondering if you took an anonymous survey of former members of Congress in the Senate and the House, Republican Party members, how many would be with you? And my instinct is that quite a bit more than what it matters. I see you nodding your heads. Former Congressman Mickey Edwards and former Gordon Humphrey, gentleman thank you very much for your time.

HUMPHREY: Thank you.

EDWARDS: Thank you, Chris.

HAYES: Next, Jeff Flake says he can`t win a Republican Primary without compromising his values and decency. What does that say about the currency of the GOP and its future, that`s next in two minutes.


HAYES: Shortly after Jeff Flake`s Senate speech excoriating the President and fellow Republicans for abetting Trump`s behavior, the front page of Breitbart focusing on Flake`s other message today he won`t seek re- election. They celebrated with a headline winning Flake out and featured Steve Bannon`s threat to establishment Republicans our movement will defeat you in primaries or force you to retire. Jeff Flake, it seems agrees with Bannon`s assertion.


UNIDENTIFIED MALE: Did that cross your mind that you`re basically laying down your -- if this is a civil war inside your party, that you`re handing them a victory by walking away?

FLAKE: Yes, that was very difficult. But, the prospect of going through the next year and like I said, the path to victory in a Republican Primary these days is to agree with the President, not just his policies, but the behavior as well and not to speak out and I can`t do that.


HAYES: Flake`s belief that he can`t win a Republican Primary without supporting Trump in what he calls reckless, outrageous, and undignified behavior, he can`t win without sacrificing his own decency and morality, is a pretty stunning assessment of the party and the Republican electorate. And while establishment Trump critics like Flake, Bob Corker and Charlie Dent exit, candidate such as Roy Moore in Alabama who openly espouse beliefs like Muslims should not be allowed to serve in Congress -- a violation of the Constitution -- those folks are winning GOP primaries and being embraced by the Republican Party.

Joining me now, New York Times` Op-Ed Columnist Michelle Goldberg and Glenn Thrush also from a little outfit called the New York Times, where he`s a White House Correspondent and an MSNBC Political Analyst. Here`s what -- I mean, at one level, there`s like, what he did today was remarkable, it`s also it is -- he is paving the way. The person that was going to primary him who he was not -- he was going to have a very hard time defeating was Kelly Ward.


HAYES: Right. Who uniquely not by lefties and rebel`s (INAUDIBLE) by -- by McConnell`s own pack, and -- who said today, Steve Bannon`s handpick candidate conspiracy theorist Kelli Ward will not be a Republican nominee for the Senate Seat in 2018. I`m not so sure.

GOLDBERG: Well, I think -- I guess the idea is that now it opens the way for somebody more palatable to run in his place.

HAYES: Right, to save off (INAUDIBLE)

HAYES: But I think you know, I was talking to Republican -- another Trump republican the other day and I asked him as I ask every Republican I talk to, you know, how do the members of the House that you know live with themselves? And he said that one of the ways they justify their own quiescence in the face of Trump is by saying that they would just be replaced by someone worse, right?

HAYES: Almost 100 percent likely.

GOLDBERG: Right, it is likely, but I also would say that it`s no excuse, you know.

HAYES: Right.

GOLDBERG: And so I think that -- I feel like Jeff Flake is to some extent getting a bad rap, that people were saying oh, he was going to lose his primary anyway. The reason he was going to loses primary is because he`s been standing up to Trump fairly consistently. That`s what takes his numbers.

HAYES: Right. That`s the cause and the effect. Glenn, there`s this thing that Bannon does, and I think is -- I find kind of amusing which is he loves to claim credit for everything. Like, he swooped into the Roy Moore race like seven hours before Election Day, and it was like oh, Steve Bannon propelled Roy Moore. I wonder whether like, is the -- is the threat actually felt on Capitol Hill about these --about those primary challenges?

GLENN THRUSH, MSNBC POLITICAL ANALYST: Bannon was responsible for picking out your nifty tie tonight. I don`t know if you`re aware of that.

HAYES: He`s claiming credit for that, too.

THRUSH: That will be on Breitbart. No, he`s like -- he`s out-trumping Trump. You know, Bannon is trumping trump. He`s like the next derivative. You know, he used to traffic in derivatives when he was at Goldman Sachs. He is derivative of Trump. He puts the -- he`s putting the Bannon brand on all of this stuff. It`s you know, it`s brilliant, out-trumping Trump. Of course, it`s not necessarily true. I think Congressman Massie after Luther Strange went down and Judge Moore won put it best. He essentially said I`m paraphrasing, the craziest SOB is going to win in these primaries.

HAYES: Right.

THRUSH: There is -- there`s no going back. You can`t get away in any of these primaries without saying the most extreme thing. Anything less than that people won`t accept. It`s like once you have had the hard stuff, you know, you`re not going for the wine coolers.

HAYES: That is -- that`s exactly right. And then you got -- so you got this situation -- I was struck today thinking about watching Flake. Today is the day that the RNC and the Senate Committee signed a joint fundraising agreement with Roy Moore. Now Roy Moore is -- I`ve run out of the ways to describe Roy Moore`s unfitness. GOLDBERG: Right, and we`ve all become so desanctified.

HAYES: And here`s -- this is -- this is Ted Cruz, you know. Judge Roy Moore for Alabama. Judge Roy Moore has a lifelong passion for the Constitutional Bill of rights. So here -- the establishment Republican Party is rallying behind Roy Moore while Jeff Flake is giving this speech today.

GOLDBERG: Right. Which is why I think Jeff Flake is correct when he says that there is no place for somebody like him whose views were you know, four years ago Jeff Flake was considered a very conservative Republican.

HAYES: He was with the hard right caucus in the House, their version of tea partiers, was who Jeff Flake was.

GOLDBERG: Right, and so I think that you know, every single person who is now you know reaping the benefits of Trumpism has to realize that eventually, the revolution is going to come for you. But you know, for now, Jeff Flake is the one who has fallen afoul of the kind of like you know, far right insurgents.

HAYES: That`s -- Glenn, that`s a great point. Like if it does feel like a little bit of a reign of terror moment here too, where -- it`s like what you said, like everyone`s -- the ideology is so thriving on conflict on the right and sort of establishing for its outsider that there`s this kind of permanent revolution dynamic that starts to set in.

THRUSH: Well, remember, Robus Pierre is not on the French money right now.

HAYES: Right. That`s right.

THRUSH: I guess there -- I guess there actually isn`t any French money right now so it`s a (INAUDIBLE) point. But I mean, look, I think the real danger here for the Republicans is we have this thing called the general election. And Arizona went by 3.7 percent for Donald Trump in 2016, with seven or eight percent going for Gary Johnson and Jill Stein. That was a tight election.

HAYES: Yes, that`s a good point.

THRUSH: The State is moving in a blue direction. The question here is can the Democrats get the candidate that they want to capitalize on this division? We`ve seen independents melt away from Donald Trump, really, really quickly. We`re starting to see Republican women again in a lot of these polls, he`s upside down with them. You know Trump -- the name of Trump`s game is always bringing the negatives up, of his opponent, whether it`s the press, whether it`s Mitch McConnell, whether it`s Hillary Clinton, we`ll see if sort of the Trumpettes, you know, these group candidates that Bannon is going to be supporting or as successful at doing the same or if we`re going to see new coalitions.

HAYES: Right. Yes, it`s a good -- it`s a good question. Michelle Goldberg and Glenn Thrush, thank you for being with me.

THRUSH: Thank you.

HAYES: Next, the unbelievable moment in which HUD Secretary Ben Carson struggles to answer very basic questions about what he`s doing at HUD. You want to see this. It`s really remarkable, after this quick break


HAYES: With all the recent focus on taxes, (INAUDIBLE) attention has been given to the actual GOP budget which is perhaps why an extraordinary exchange with Congressman Al Green of Texas and HUD Secretary Ben Carson is now getting so much attention. The Congressman simply wanted to know what exactly will be cut from HUD`s budget.


REP. AL GREEN (R), TEXAS: How much from public housing, Mr. Carson?

BEN CARSON, SECRETARY, HOUSING AND URBAN DEVELOPMENT: Probably in the neighborhood of -- if you combine all the programs, 2 to 3 billion.

GREEN: 2 to 3 billion. How much from housing vouchers, Mr. Carson?

CARSON: Rather than go through a quiz on all the numbers --

GREEN: It`s not a quiz, Mr. Carson, I have the time to ask you questions about things that you should have some knowledge of. If you have no knowledge of them you can simply say so.

Why would the Secretary of HUD not give the number, the amount that you`re cutting from housing vouchers, Mr. Carson? You`re the Secretary of HUD. You`re making the cut.

CARSON: Because we`ve already talked about the total amount of the cuts.

GREEN: Well, the total amount does not help me when it comes to the housing vouchers. I have people who use housing vouchers and I need to be able to explain to them, Mr. Carson, how much the cut portends for them. How much, Mr. Carson?

CARSON: Let`s hear your number.

GREEN: Well, Mr. Carson, you`re the witness testifying today and if you want a moment to ask someone behind you, I would gladly accord you that moment.

CARSON: I don`t want to look at the book and look at the numbers.

GREEN: I see. But you choose not say how much you`re cutting from housing vouchers. All right, how much you`re cutting from community block grants, Mr. Carson.

CARSON: I want to talk about --

GREEN: Mr. Carson, you don`t get to talk about what you want to today, you get to talk about what I want you to talk about. You get to answer the questions that I pose Mr. Carson.

CARSON: Yes, but I also get to answer the question the way I want to.

GREEN: Well, you can answer them the way you want, but if you want to show of lack of knowledge, you can do this. It`s quite all right Mr. Carson. So now, how much from community development block grants, Mr. Secretary?

CARSON: Again, I`m not willing to sit there --

GREEN: So you don`t know how much from community development block grants.


HAYES: And when it comes to Republican tax cut plans, Senator Chuck Schumer believes that President Trump`s knowledge is about the same. It`s plausible. That`s next.



SEN. CHUCK SCHUMER, (D) NEW YORK: As everyone knows, President Trump put down his phone for an hour to come to the Senate Republican luncheon to talk tax reform.


HAYES: The president in desperate need of passing the only legislation he really cares about went up to the Hill today and tried to charm his own party to work with him on tax cuts. But if you`re a Republican rooting for this to succeed, the problem is his effort is starting to look a lot like the failed attempts at repealing Obamacare. You have got dissention within the Republican caucus, a president who doesn`t fully grasp the issues, and a whole lot for Democrats to rail against.


SCHUMER: What the president says and what the Republican plan does are polar opposites. So for instance, the president said this is not a plan for the rich. Blatantly untrue. Then he said at the heart of our plan is a tax cut for everyday working Americans. Untruth number two. When they talk about getting rid of state and local deductability, when they talk about limiting 401(k)s, when they talk about limiting the mortgage deduction, those are all aimed at making the middle class pay more so the rich can get a bigger tax break.

This plan is a disaster for America. It`s no wonder our Republican colleagues want to rush it through in the dark of night.


HAYES: Republican congressman Matt Gates of Florida joins me now.

Congressman, here is my question, it doesn`t seem like there is yet the consensus necessary within your caucus in the House and the Senate to actually have a plan. Is that correct?

REP. MATT GATES, (R) FLORIDA: Well, we have a blueprint, Chris, and that blueprint will make a tax code that is a lot simpler, a lot more fair for the American people, it will bring back more than a trillion dollars in cash that`s housed overseas and it`ll lead to rising wages and more opportunity for the American people to prosper.

HAYES: Here is my question about that. We tax of wages. There`s all sorts of ways that we directly tax wages. The argument that I`m getting from the White House and others is that we have to cut the corporate rate, which is actually paid at the level of capital to get the wages up, but that seems like a weird Rube Goldberg Machine. You guys could just cut taxes on wages if you wanted to cut taxes on wages.

GATES: Well, we`re going to cut taxes for all Americans. We`re going to cut taxes for individuals. But Chris, one of the main things that throws a wet blanket over our economy is that we have one of the highest corporate tax rates in the world that drives jobs overseas and limits our ability to be competitive.

HAYES: I get that`s the argument. But here`s the thing, you just said you are going to cut taxes for all Americans, but here is the Rubix Cube I can`t solve. You have got to raise taxes for someone somewhere unless you`re going to expand the deficit. So, there is two ways this can happen. You can get reform, which is deficit neutral, which means some taxes go down, some taxes go up, or you can get a deficit financed tax cut that`s going to blow up the deficit, but you have to choose between those two and it`s unclear which of those two you are all pursuing.

GATES: Well, we don`t have to have more taxes and higher taxes, we need more taxpayers. And we`ll have more compliance with a system that is fair. So, actually by lowering rates we can increase revenue for the government because right now we have got a lot of people who don`t make any contribution and when nine out of every ten Americans can fill out their taxes on a post card, we think we`ll get more compliance, more revenue for the government, and ultimately we`ll have the opportunity to lower rates for Americans to achieve their dreams.

HAYES: That is not an answer to the question.

GATES: Well, sure it is.

HAYES: Well, some rates are going to go up, right. So, there is some talk about getting rid of the state and local tax deduction.

GATES: No. There`s loopholes that need to go away.

There is a lot of special interests...

HAYES: Congressman, respectfully, loophole is in the eye of the beholder. You should tell the people watching right now that the mortgage interest deduction is a loophole.

GATES: Pro sports leagues have a loophole. Do you really think that pro sports league...

HAYES: No. Oh, no, no -- get rid of that. But you`re not going to -- but congressman, you and I both know...

GATES: Of something that the president has supported. But you believe that we`re going to get rid of the loopholes that are enjoyed by professional sports leagues and a lot of other loopholes that are in the tax code, because we`ve got a 70,000 page tax code that doesn`t benefit most Americans, it benefits the special interests.

HAYES: Right, like people that say pay the estate tax, which is .2 percent of households who have more than $5 million in assets, whose taxes are going to be cut by what you`re proposing while someone that maybe lives in a city that has fairly high taxes is going to see their taxes go up if you get rid of the state and local deduction.

You see the problem here is that there`s going to be someone...

GATES: In high tax states, and in high tax municipalities, yeah, things are worse. You know what, states that have really high taxes should cut them and that will even super charge and greater leverage the tax reform that we`re doing here in Washington.

HAYES: Although, California is doing OK economically with fairly high taxes.

But explain to me why do -- why is it -- I mean, you`re going to go out there, and I`m just telling you what Democrats are going to say, like Chuck Schumer, right, so the plan is going to drop and they`re going to say out of the 487 -- out of 487 people that die, one person is going to pay the estate tax, right, it`s about .2 percent who have $5 million in assets. You are going to cut taxes for them and to make it deficit neutral, someone`s taxes are going to go up.

Why should taxes go up on anyone to pay for a person who has got $5 million in assets who just died?

GATES: Well, I would be perfectly OK raising taxes on pro sports leagues if it didn`t mean we were double taxing people who they die. I think it is terribly unfair that we take money that people have already paid taxes on and then tax them again at death. That`s ludicrous.

HAYES: But congressman, that`s the craxy thing, you can`t double tax a person who doesn`t exist. And when they die, definitionally they`re not a person any more. Do you see the problem there?

GATES: Well, but the money that somebody makes in a family business or on a family farm, often times they want to be able to pass on the next generation. That is kind of one of the essentially elements of the American dream, is ensuring that the to make sure the next generation is better off. And if we do what the liberal want, we impair the next generation.

HAYES: I want to be clear. You think a crucial part of the American dream is for people with more than $5 million in assets, the .2 percent to pass on the full total of the amount of money they make to their heirs. That`s the American dream?

GATES: You cast it so incorrectly. Family farms, small businesses...

HAYES: No, they`re not family farms.

GATES: Are often passed throughs that are individual in nature and so -- well, that is a prime example.

Look, the death tax has really killed family farms in this country. You want to know why we`ve gone away from family farms and more towards corporate farming that you and other liberals have railed against, is because we have the death tax.

HAYES: It is not because of the estate tax.

Here`s the thing, though, fundamentally, here is what I want to know on the record, when all is said and done, I know you guys have a blueprint, it`s going to come out., is it going to be deficit neutral? Like is that the idea? That like whatever goes up on one side of the ledger comes down on the other and vice versa, a la `86?

GATES: Well, that depends on how much spending we cut. The House of Representatives passed a budget that cuts more entitlement spending than any congress since Newt Gingrich and Bill Clinton worked out welfare reform.

HAYES: I`m going to make a prediction now -- wait, I`m going to make a prediction now and I want you back on the program when the prediction comes true or doesn`t come true so you can lord it over me -- that won`t happen. The deficit will go up. And when you...

GATES: Well, I`m going to be fighting for it. I`m going to be fighting for conservative spending cuts and conservative tax reform.

HAYES: You come back and we`ll see who is right about this. Congressman Matt Gates, thanks for taking time.

GATES: Thank you, Chris.

Still to come, why did a two-person company in White Fish, Montana get the massive contract to rebuild Puerto Rico`s devastated power grid. That amazing new reporting and that company`s connections to the Trump administration ahead.

Plus, Bill O`Reilly blames god in tonight`s Thing One, Thing Two next.


HAYES: Thing One tonight, after The New York Times reported over the weekend that former Fox News host Bill O`Reilly personally agreed to pay $32 million to a colleague to settle new sexual harassment allegations, the Hollywood Reporter broke the news today that O`Reilly has been dropped by his talent agency, UTA -- ouch -- saying it would no longer be representing him when his agreement with the company expires at the end of the year.

Now, to O`Reilly this appears to be another example of being unfairly attacked by people who want to hurt him, as evidenced by the most recent commentary on his website.


BILL O`REILLY, FORMER FOX NEWS HOST: My enemies, who want to silence me, have made my life extremely difficult, hurt me in the marketplace. Whether that will be forever, I don`t know, but they have damaged. And it`s me and my ace investigative team, really good, good people, good investigators, against this cabal.


HAYES: But then Bill O`Reilly, a devout Catholic, said he feels personally victimized by a higher power.


O`REILLY: Am I mad at god? Yeah, I`m mad at him. I wish I had more protection. I wish this stuff didn`t happen. I can`t explain it to you. Yeah, I`m mad at him. If I die tomorrow, and I get an opportunity I`ll say what did you guys work me over like that?


HAYES: Or maybe god is a woman and that conversation will go a different direction.

Either way there is a great little video clip about personal responsibility that Bill might want to watch, and that is Thing Two in 60 seconds.



O`REILLY: Am I mad at god? Yeah, I`m mad at him. I wish I had more protection. I wish this stuff didn`t happen. I can`t explain it to you. Yeah, I`m mad at him.


HAYES: After the New York Times reported that Bill O`Reilly settled new sexual harassment allegations by personally forking over $32 million, he`s placed the blame on everyone, from the media to the almighty, anyone but himself. Don`t you think it`s time for a little personal responsibility?


O`REILLY: We`re living in a time of denial. Our culture is cluttered with excuses for bad behavior. It`s always somebody else`s fault, not the individual screwing up.

All of us make mistakes, but how many of us own up?

Talk to teenagers today, you`ll hear a litany of excuse making for just about everything. And while those immature minds can be understood, we often don`t challenge the dodge.

Our schools and courts are chalk full of people and authority who allow excuses to mitigate awful behavior.

Celebrities like Lindsay Lohan have an excuse for everything. And you know what is likely to happen to Miss Lohan? A grizzly end, that`s what.

Substance abuse, rampant in America, cyber violence an epidemic, irresponsibility off the chart, and what are we doing about it? What are we doing about it? Making excuses.


HAYES: And that`s the memo.

(COMMERCIAL BREAK) HAYES: A bizarre scene at the Capitol today as President Trump and Mitch McConnell were walking into a lunch with Senate Republicans, a protester inside the Capitol Building, hold Russian flags at the president and accused him of treason.


UNIDENTIFIED MALE: Trump is treason. Trump is treason. Trump is treason. Trump is treason.

Why are you talking about tax cuts when you should be talking about treason? Why is congress talking about tax cuts when they should be talking about treason.

This president (inaudible), we should be talking about treason not about tax cuts.


HAYES: The president did not appear to notice the Russian flags, providing a handy literal illustration of a figurative comment from Lindsey Graham.


LINDSEY GRAHAM, REP SENATOR SOUTH CAROLINA: I think the Trump administration is slow when it comes to Russia. They have a blind spot on Russia I still can`t figure out.


HAYES: You might remember a big story from July when President Trump was forced seemingly against his will to sign a bill that had been passed overwhelmingly, veto-proof majorities in congress to place tough new sanctions on Russia.

The Trump administration was supposed to implement the sanctions by October 1st, but they didn`t do it. Nothing. The Daily Beast reports that lawmakers feel that they`re being stonewalled and can`t do much about it. Aside from procedural tactics, congress is essentially powerless and compelling the executive branch to follow through on the law. Though, I`m sure they can think of some things. It certainly doesn`t help when members of congress are instead chasing conspiracy theories at the bidding of the White House. Today, Devin Nunes, the powerful chair of the House Intelligence Committee, announced a new propose seemingly designed to expose the links between Russia and President Hillary Clinton.

You see, Clinton is potentially implicated in the Obama administration`s 2010 decision to approve the sale of American uranium mines to a Russian- backed company, at least according to President Trump, who tweeted Thursday, "Uranium deal to Russia with Clinton helping Obama Administration knowledge is the biggest story that fake media doesn`t want to follow".

The seven year old deal has become an obsession of the conservative media as it seeks to distract from Trump and Russia and all other things. Sean Hannity calls it one of the biggest scandals in American history, and the White House couldn`t be happier that Nunes is once again carrying its water.


SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: I certainly think it is a move in the right direction and something that we`ve spoken about several times here that if there was any collusion whatsoever during the campaigns of any point, our -- or any collusion at any point with another country, that they should look at the Clintons. And so I think that`s the right thing.


HAYES: House Republicans announced a new probe into, I kid you not, the FBI`s handling of Hillary Clinton`s e-mails. Who know, if Republicans play their cards right, they might actually be able to impeach Hillary Clinton.


HAYES: The lack of power in Puerto Rico remains the single biggest obstacle to recovering from Hurricane Maria. Three out of four people there remain without electricity more than a month after the hurricane devastated the island.

Tonight, there are questions about how a $300 million contract to restore energy to Puerto Rico was awarded to a tiny energy company with just two employees. Yes, Whitefish Energy, based nowhere near Puerto Rico. It`s from the town of, maybe you guessed it, Whitefish, Montana. More than 3,000 miles away near the Canadian border, which also have happens to be the hometown of Ryan Zinke, that`s Trump`s Secretary to the Interior.

The Washington Post are reporting one of Zinke`s sons even worked for Whitefish one summer as a, quote, "flagger", but before this massive deal with Puerto Rico, Whitefish`s biggest federal contract was a $1.3 million job replacing and upgrading parts of a 4.8 mile stretch of a transmission line in Arizona. The company now says it`s hired 280 workers who are now in Puerto Rico, mostly subcontractors, and that it continues to increase that number.

For context, the day after Hurricane Irma hit Florida, nearly 20,000 workers were already helping to restore power there.

Jack Gillum, one of The Washington Post reporters who broke this story. Jack, there is a lot that is head scratching about this contract. Let`s start with this, how did Whitefish get the contract?

JACK GILLUM, THE WASHINGTON POST: So, Chris, this is an interesting and curious case that you referenced in terms of Texas and Florida. Normally in these cases some of these power companies use what are called mutual aid agreements where they work together to restore power.

Why Puerto Rico went directly to Whitefish is the source of our reporting and the source of many questions. In fact, when we asked power officials in Puerto Rico about this, they declined to answer specifics on it. In fact, the governor going as far as saying that this is really just rumors of people who just didn`t get the contracts and missed out on better work.

HAYES: Okay. I want to be clear here. When you talk about this mutually aid model. So, in places like Texas or Florida, what you`re saying is other utilities band together and send a lot of people. So you`ve got sufficient boots on the ground to restore power? That`s how it works?

GILLUM: That`s effectively it, yes.

HAYES: And in this case, you`ve got the utility in Puerto Rico, it`s called PREPA, it`s a basket case, it`s in debt, it`s notoriously had a very hard time. They sign a contract for $300 million, with really high prices, with this tiny little outfit in Whitefish, Montana, with two employees and no one knows how that contract came about?

GILLUM: So when we spoke to the company about this, they were spinning up dozens of people if not a week or a month. As you mentioned, they have almost 300 people there. The prices are particularly -- could be high, too, at least on paper, although, for $300 an hour for a supervisor, a few hundred dollars an hour for a lineman, the company also says in fairness, these aren`t exactly a guy in a bucket truck on the street in Manhattan or in Washington. These are very dangerous high power lines, accessible sometimes by helicopter and really a lot of work ahead.

But it is, indeed, a very large contract. The last one you mentioned about $1.3 million to restore some power lines in Arizona. This is by far the biggest contract this company has ever gotten in its two-year existence.

HAYES: Right, by a factor of 200 basically. It`s a much, much bigger contract.

You`ve also got, I mean, you`ve got a situation where it just seems to me that the capacity of these folks who are now the primary people trying to get this back up, this grid, and what`s needed is just a total mismatch.

GILLUM: So this company, it was small. I mean, they had two employees as of the latest federal contract that they have to write information about their company in which they said at the time they had $1 million in revenues. They had pulled in subcontractors. They say that`s part of their business model, is to bring in people for temporary work when they need it, such as a case like this.

I think the bigger question, Chris, though, is why this company was chosen, given the fact that normally these utilities band together, and there`s questions about how much money FEMA, which is the Federal Emergency Management Agency will reimburse in this process.

HAYES: Did Zinke -- it`s hometown. His son worked for them for a summer. Do we know any possible other connection there?

GILLUM: Well, when we had spoken to the company about it, we had asked the CEO of Whitefish whether they knew each other. They said, yes, they knew each other. We asked directly, was interior or Secretary Zinke involved in this?

But meanwhile, they have received help through the interior department. A local NBC affiliate in Montana in fact had asked the CEO a few weeks ago if, indeed, you know, they had reached out for help and they said, yes, they had contacted the office to get supplies to the island.

HAYES: Alright. I feel like we`re going to learn more about this. There are a lot of unanswered questions. Great reporting from Jack Gillum. Thanks for your times.

That is All In for this evening. The Rachel Maddow Show starts right now.

Good evening, Rachel.


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