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38 million could lose food stamps due to shutdown. TRANSCRIPT: 1/7/2019, All In w. Chris Hayes.

Guests: Chris Van Hollen, Norm Ornstein, Aisha Moodie-Mills, Eric Swalwell, Michelle Goldberg, Astead Herndon, Jared Bernstein, Alexis Goldstein, Waleed Shahid

Show: ALL IN with CHRIS HAYES Date: January 7, 2019 Guest: Chris Van Hollen, Norm Ornstein, Aisha Moodie-Mills, Eric Swalwell, Michelle Goldberg, Astead Herndon, Jared Bernstein, Alexis Goldstein, Waleed Shahid

CHRIS MATTHEWS, MSNBC HOST: The challenge for the Democrats is to find the person who can better carry out the higher responsibilities of the American presidency in a way that is convincing to the voters next year in November. And that`s HARDBALL for now. "ALL IN" with Chris Hayes starts right now.



DONALD TRUMP, PRESIDENT OF THE UNITED STATES: They say the wall is immoral. Well, then you better got to do something about the Vatican.

HAYES: The President paints himself into a corner.

TRUMP: It`s a barrier from people pouring into our country.

HAYES: Tonight, the latest evidence the White House doesn`t even know what they`re asking for as the pain for federal workers grows. Then, Democrats say they`ll make transcripts available to Robert Mueller but what about the public? I`ll ask Congressman Eric Swalwell. Plus Elizabeth Warren kicks off 2020 in Iowa.

SEN. ELIZABETH WARREN (D), MASSACHUSETTS: I think that what our 2020 issue will be is how we talk about what we stand for.

HAYES: Why what`s happening on the ground is different than what you`re hearing. And the AOC effect.

REP. ALEXANDRIA OCASIO-CORTEZ (D), NEW YORK: The only way we are going to get out of this situation is by choosing to be courageous.

HAYES: How a new generation of Democrats is fundamentally changing the policy debate.

REP. JOAQUIN CASTRO (D), TEXAS: There was a time in this country where the top marginal tax rate was over 90 percent.

HAYES: When ALL IN starts right now.


HAYES: Good evening from New York, I`m Chris Hayes. Day 17 of the government shutdown. The President is just stuck in a corner he`s painted himself into as we have all watched, and he doesn`t even know what he actually wants. In fact, here`s the thing. No one knows what the government is being shut down over. And by this here`s what I mean. We know the money. They want $5.6 billion for depending on which day it is, the wall or steel slats, or border security generally.

Here`s the actual appropriation the House passed just before the end the year to direct public funds for the project that Mexico we ever promised would pay for. You`ll notice there are no details like what exactly they`re asking for, just the top-line money. And in fact this weekend when Democratic aides press the Vice President Mike Pence during negotiations asking what exactly do you want to build, he gave no details.

As Lindsey Graham said, it`s a metaphor. As a New York Times reports, the wall was originally get this, a mnemonic device so that Candidate Trump would remember to talk about border security, the wall. And here we are. We are now in day 17 with paychecks not flowing workers, with TSA sick outs happening with extensive airport delays with a federal courts about to run of money, Food Stamps imperiled for millions of people, all of this over a metaphor and or a mnemonic device the President now desperately needs to turn to some kind of reality and is shutting the government down over.

All to hide the fact that he spent three years selling this con and rally after rally and on Capitol Hill and from the Rose Garden and then Ann Coulter and Rush Limbaugh called him on it and now here we are. The President is now desperately trying to whirl around using all the Donald Trump`s sales stick to make it work to gut his way out. He`s threatening to declare a national emergency, charging off to the border, demanding prime time airtime on all the major networks, and floating this idea that the Vatican City has a wall so Catholics should love it.

But it only reminds me a lot of the week before the Midterms when you just saw from the White House this just kitchen sink desperation to sell the American people on a losing argument. Acting Chief of Staff Mick Mulvaney was on Meet the Press looking well, desultory and whining that Democrats aren`t helping him out with the straitjacket he tied himself in.


MICK MULVANEY, ACTING WHITE HOUSE CHIEF OF STAFF: The first line that the chief negotiator said was we`re not here to agree to anything which is a stunning way to start a negotiation. The discussion immediately turned to a bunch of technical requirements or technical requests that the Democrats were asking for, for the first time ever in these negotiations. So I think this is going to drag on a lot longer and I think that`s by intention.


HAYES: Notice he was saying that the Democrats are asking what exactly they wanted to build. Sarah Huckabee Sanders appeared on Fox News where Chris Wallace debunked this obviously ridiculous statistic that we`ve been debunking as well about terrorists crossing the border. Take a listen.


SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: We know that roughly -- nearly 4,000 known or suspected terrorists come into our country illegally and we know that our most vulnerable point is at our Southern Border.

CHRIS WALLACE, ANCHOR, FOX NEWS CHANNEL: Wait, wait, wait. I know this statistic. I didn`t know if everybody use it but I studied up on this. Do you know where those 4,000 people come or where they`re captured? Airports.

SANDERS: Not always. Certainly --

WALLACE: Airports. The State Department says there hasn`t been any terrorists that they found coming across the Southern Border from Mexico.

SANDERS: Well, it`s by air, it`s by land --


HAYES: The reality remains exactly the same. It is Donald Trump shut down. He shut down the government. The House has passed a bill that could probably right now get 70 votes in the Senate and open up the government. Trump is refusing to sign it. He`s refusing to allow it to come for a vote in the Senate because apparently he`s Mitch McConnell`s boss and Dems are now ratcheting up the pressure.

More and more Democratic senators are saying they will not vote for any bill until the government is reopened. Joining me now, the senator who first articulated that strategy Chris Van Hollen, Democrat from Maryland. Senator, you tweeted about this about how -- you were basically of the opinion that the Senate should not be doing its normal business going about other pieces of legislation for consideration until the government opens. Why and what does that mean for your other colleagues? Are they joining you?

SEN. CHRIS VAN HOLLEN (D), MARYLAND: Well, Chris, we need to make a strong statement. This is not business as usual and so tomorrow we should make it clear that the first order of business should be voting on the two house measures that have already been passed, that have already been supported in various ways in the Senate including by Republican senators, and that would reopen the government.

We need to make it clear that while this is the Trump shutdown, it`s being enabled by the fact that Mitch McConnell and Senate Republicans are trying to hide out. They`ve been essentially AWOL. They haven`t been to the White House and they should not be essentially contracting out their votes as Senate Republicans to Donald Trump. And they need to join us in voting for measures to open the government.

And so tomorrow, that`s what we will focus on. And then the caucus will have to decide how to proceed but overall we`re making the clear statement that it cannot be business as usual.

HAYES: Wait. But you`re only making that statement if you get 240 votes to block motions to proceed? Because if you don`t have that, then Mitch McConnell`s got about like 9,000 judges that are just like coming out of every pocket in this suit that he`s going to try to ram through. So are you going to get enough your colleagues to basically block motions to proceed because that really means something?

VAN HOLLEN: Well, as you know, motion to proceed on a legislation requires 60 votes so you can block it with 40. A motion to proceed on judges does not require 60 votes, that requires 50. But we`re going to start by saying tomorrow that SB-1, Senate Bill 1 should be a bill to reopen the government. It should be a vote on the House bills. After all, the House of Representatives, the new Democratic majority, they made it a priority to first focus on reopening the government, and we think that`s what we should do.

So you`re right tomorrow, the hope will be and there`s growing support and momentum, I think we can do it, would be to say Senate Bill 1 needs to be the House bill`s to reopen the government. Let`s vote on that first and send a very strong signal that it should not be business as usual. But the caucus will have to decide how to proceed. But I think there`s strong consensus that we need to send that message tomorrow.

HAYES: Democratic Leader Chuck Schumer said that he will be voting that way. He`s going to vote against motions to proceed on things that are not reopening the government. I saw Brian Schatz of Hawaii, a bunch of other people, I don`t know the whip count, but what is the status of negotiations? It was totally bizarre to me and tell me if I`m wrong, that the Vice President is States was negotiating with Democratic staff this weekend? Is that weird?

VAN HOLLEN: It`s totally weird. And it`s weird in two ways. One, they need to be negotiating with members. Secondly, you need to have the Republican Senate staff there as well. And this is -- this is the main point, Chris. We need to turn up the heat on a lot of these purple state Republican senators, a lot of them who were up in 2020. And they are sort of hiding out right now just like McConnell is not showing up at the White House or even sending some staff.

HAYES: You can`t find him. I haven`t seen the guy`s face.

VAN HOLLEN: Exactly. And look, you know what happened, right? I mean he got a strong signal from the White House before Christmas that President Trump would support the measure to keep the government funded until February 8th, and then as you indicated you had all the right-wing you know, talk show hosts go the other way and pull the rug out from under the Vice President and others.

And so that`s obviously another huge problem, right? Who do you have to negotiate with. And that`s a -- that`s a challenge. But I think the main thing is we do need to make sure Senator McConnell and Senate Republicans have to be part of the solution and they can`t just go run away.

HAYES: OK, let me -- I`m going to give you a sentence with a blank and ask if you can fill in the blank because I can`t. The President of United States wants $5.6 or $5.7 billion dollars appropriated for blank? What is the answer to the question? What is the thing there?

VAN HOLLEN: And that`s just it. They have not specified it. Look, as you know, long before Donald Trump was president, we had a broad strategy for border security. The issue here has never been about having secure borders. We need secure borders and we`ve always achieved border security through a combination of having Border Patrol agents, technology to detect you know, people coming across the border, and a range of other options including barriers in some places especially places where there are lots of people.

And what Donald Trump has came in last year and we got is $1.3 million not for a wall but for some of this border security. And the bill that passed the House just before Christmas would have continued that same level of funding. And so they cannot really answer that question at this point in time. And all they`re doing is creating a lot of pain for people throughout the country who increasingly are not getting services.

I met today with a whole bunch of federal employees who are not getting paid, who are now really worried about making ends meet and paying their bills. And this is all for as you said a metaphor, this delusion that President Trump has.

HAYES: Yes. We -- I talked to -- I was hearing about a friend of mine whose assistant U.S. attorney you know, who`s doing the work every day, who`s says two paychecks is one thing, then three paychecks, like folks are going to be squeezed here.

VAN HOLLEN: Look, I mean, it`s -- we`re into 17 days and it looks like it could go on for a long time because you know, President Trump said he was going to be proud to shut down the government, pointing fingers now but this is this is now very intentional even though as you indicate they really don`t know what they want and they don`t know the way out. And that`s why this is scary and that`s why we need Senate Republicans to really be part of the solution and pass those House bills.

HAYES: They should just get together and tell them the wall got built. Senator Chris Van Hollen, thank you very much.

VAN HOLLEN: Thank you.

HAYES: Joining me now are Norm Ornstein Senior Scholar at the American Enterprise Institute and Aisha Moodie-Mills Democratic Strategist. I want to start with you, Norm, because you have written for a very long time about Congress, congressional dysfunction, particularly the Republican parties. And this strikes me as sort of a new frontier although a continuation of some other trends. What do you think?

NORM ORNSTEIN, SENIOR SCHOLAR, AMERICAN ENTERPRISE INSTITUTE: It`s a new low but it is a continuation of a number of other trends. And what we see is that Mitch McConnell who could bring this to a halt if it were an independent Senate won`t do so. And as you mentioned and as Chris Van Hollen has mentioned, you have a number of Republican senators who are up in 2020 who are probably privately asking him to do something about it. But there is driven by Ann Coulter and Fox and Friends perhaps as Donald Trump is. And that`s a new reality in some ways that fits on a deterioration of a political party that`s been going on for a couple of decades.

There`s another element of this though, Chris. And the term that I`ve used for the last couple of years is "kakistocracy" which has a Greek root government by the worst and most unscrupulous among us. And when you look at a shutdown where the White House had no idea what the government did where Ben Carson`s Department of Housing and Urban Development failed to sign a bunch of contracts that may have people evicted from their housing, where we`ve had people die in national parks because they didn`t realize that if there were no Rangers there, bad things could happen.

The level of ineptitude and a Republican Congress that didn`t hold a single hearing on what was going on with problems in government over the last two years and hasn`t done anything to this point. This is beyond sad. It`s tragic and it`s outrageous.

HAYES: Just to give a citation for what norm just mentioned. This is the Washington Post article about the White House being surprised by the breadth of things the federal government does. I`ll read here. The Trump administration which did not anticipate a long-term shutdown recognized only this week the breadth of the potential impact, several senior administration officials said.

The officials said they were focused now on understanding the scope the consequences in determining whether there`s anything they can do to intervene. The President has now said that he`s going to give a prime-time address tomorrow night. He`s asked for time on all the major networks which as far as I understand have all granted to him including this network. What do you think of that?

AISHA MOODIE-MILLS, DEMOCRATIC STRATEGIST: Well, I wish that the network`s wouldn`t grant it to him. It just seems like a nothing burger again. He`s trying to you know, do a dog and pony show around nothing. He has nothing to describe --

HAYES: There`s no new argument in order to get there.

MILLS: There`s no new news. And in fact, this is all just a manufactured outrage, this "border insecurity," is all just fake news that the president and the administration have made up. There`s no evidence that anything that they suggest is going awry in the way that it`s going awry. And so you know, the thing that frustrates me --

HAYES: Well, from a security perspective.

MILLS: From a security --

HAYES: From a humanitarian perspective, there`s some real problem.

MILLS: And here`s the other thing --

HAYES: There`s two people have died in custody --

MILLS: This administration is causing. This administration is causing those humanitarian issues which is also the challenge we`re not discussing. And now we have over 800,000 families that are not going to be paid for however many weeks on end. These are civil servants. These are folks who can`t afford to miss a paycheck. These are people who are trying to pay their rent, take care of their family, and now because of this shutdown of this manufactured faux crisis, they`re not going to be getting paid.

HAYES: Here`s that thing about the primetime address that by the way we should note that in 2014 President Obama tried to address the nation on the immigration and the major networks did not give him grant in that time just as a historical note. Norm, what`s interesting to me is this president has a weird set of political skills and they sometimes they`re to use them to his benefit in his kind of canny, wily strange way.

The one that he does not have that a lot of presidents had is moving the middle of American public opinion. He has been making arguments about the wall for three years and his only exacerbated opposition to it. What do you -- I mean, think he can`t shape public opinion whether he gets a prime- time address or not.

ORNSTEIN: No and you know, we`ve had presidents before who`ve tried to exploit their bases for political advantage. Richard Nixon did it with the law and order campaign and the Southern Strategy, but every president before Donald Trump also saw the importance of reaching out to the broader public and building a larger coalition. He has not spent a minute trying to do that.

Now there`s a cleverness to that in the sense of self-survival, it so intimidates Republicans in Congress that he has 80 to 90 percent support from the base that they won`t challenge him. But it`s disastrous for the country. And we have to note, it`s not just the 800,000 federal employees, its contractors including people who clean the office buildings who work by the hour who may never get paid, it`s people whose livelihoods depend on having services provided, those who own stores and restaurants and the like. The reverberations are very wide and Trump could care less as long as he keeps that basis.

HAYES: But here`s the thing. They are not -- this is not an argument. I`ve watched them make arguments that felt like they were winning or this is not -- they`re not winning this argument. What they`re doing is just like it`s just a destructions strategy. Like this is going to cause pain and we care about a less than you do.

MILLS: At this point, it`s all about ego. I don`t think that we`ve ever - -

HAYES: Wait, that`s a good point. It`s not even actually about the policy.

MILLS: This is ego. It`s just merely bravado is point. I don`t think we`ve ever seen a president that has had this much disregard for the American people, could care less about how people`s lives are actually being affected. And so what we`re seeing right now I think is going to be an erosion at some point of the president`s base because a lot of these people that are being affected by the government shutdown in the residuals are actually people who used to support him.

HAYES: Well, so the question on that right, Norm, and in terms of erosion is, at what point does it start to take bites out of people? Some very interesting announcement today that IRS which is about 12 percent of its workers not furloughed has to start processing refunds. People will notice if they do not get their refunds. The White House announcing today they`re going to direct the IRS workers to prioritize that. It`s unclear if they can do that. But that to me was a sign from them that they`re not completely immune to political gravity, and like they understand it`ll be real bad if that goes south.

ORNSTEIN: No doubt about it. And of course if the airports really become a major problem and the air traffic controllers along with the TSA people and people really begin including businesspeople to find that they can`t travel anymore, there`ll be some pushback on that front too. You know, I`ve said many times that I don`t think Donald Trump ever read the Art of the Deal much less wrote it.

And I have never seen a president in almost 50 years of watching them up close more in-depth at cutting deals or finding his way into deals, he goes into box canyons over and over again. And ego is a part of it but ineptitude, fundamental ineptitude and running anything. It`s amazing and if he didn`t have the 200 million that his father gave him to begin with and the ability to coerce people probably with money that he ever got where he got.

HAYES: Norm Ornstein, Aisha Moodie-Mills, thank you both your time tonight. Coming up, signs the Mueller investigation has a long way to go before it wraps up. But what are the newly empowered House Democrats going to do with their investigations? I`ll ask Congressman Eric Swalwell in two minutes.


HAYES: Special Counsel Robert Mueller`s investigation looks like it still has a long way to go before reaching a conclusion. The grand jury working a Mueller`s probe was set to expire over this past weekend but instead, federal judge overseeing it just extended its lifespan by up to six months. By law, grand juries are conducted in total secrecy and with the exception of indictments and other public filings. Mueller`s work has been carried out almost entirely behind closed doors.

When it`s all over, there`s no requirement for him to release all of his findings publicly. That means that the Special Counsel`s probe may not, we`ll see, be able to deliver what so many have been demanding since 2016, a full transparent and public accounting of what the president and his associates did or did not do to an office or to reward those who may have helped them.

Now, with Democrats in control the House and its key investigative committees, they have the power for the first time to air the facts in public. Congressman Eric Swalwell is a Democrat from California who sits on two of those key committees, House Intelligence and House Judiciary. Good to have you, Congressman. I want to play you something the --


HAYES: -- new Chair of the Intelligence Committee Adam Schiff had to say about releasing transcripts. Take a listen.


REP. ADAM SCHIFF (D), CALIFORNIA: We hope as one of our first acts to make the transcripts of our witnesses fully available to the Special Counsel for any purpose including the bringing of perjury charges if necessary against any of the witnesses, but also to see the evidence that they contain and help flesh out the picture for the Special Counsel.


HAYES: What do you think about releasing them to the public as well?

SWALWELL: I want that to happen as soon as possible, Chris. So our priorities, protect Mueller, send evidence to Mueller, and we`ve got a lot of evidence that the Republicans would not send over to Mueller, and then make sure the public understands what Mueller did as soon as Mueller is done. That`s my priority.

HAYES: So I want to play you something else that someone on my show Michael Waldman who worked on for Bill Clinton, as a speechwriter at the Brennan Center said that really clicked something into place for me about how I understand the moment were in and the need for publicness, for public hearings, public investigation. Take a listen.


MICHAEL WALDMAN, PRESIDENT, BRENNAN CENTER FOR JUSTICE: There has to be the case made to the public in a real tangible, visible, dramatic way about what has gone wrong. I do worry about the idea that this silent G-man is going to deliver the facts all the scandals that have made the history in the country. There`s been a real congressional investigation. They have power and they need to use it.


HAYES: Do you agree with that?

SWALWELL: Absolutely. And we saw that with Watergate. The powerful testimony from John Dean that opened the investigation wide open as far as the public is concern. And right now, you know who is benefiting from the darkness as especially on the House investigation are the witnesses because they`re all working together and we saw that in our investigation. Some of them are represented -- you`ve got three or four people represented by the same lawyer so they`re sharing stories, they`re getting their accounts straight and the only people in the dark are the American people.

And I think it`d be -- it would really help us if we`re going to protect the ballot box going forward if the American people understand what Russia did, who they worked with, and what we can do to make sure it never happens again.

HAYES: Yes. So I guess the question is you know, I talked to Congressman Chair Schiff about this few days ago about what the plan is for how much and how in-depth a kind of set of public hearings on just these matters that you`ve already sort of investigated a bit. What`s the plan for that?

SWALWELL: So there will be public hearings. And I know Chairman Schiff has talked about that and I will defer to him on you know, who they -- who they are with and when they happen. But we wanted in the past to balance you know, the interest of making sure Witnesses weren`t sharing accounts with each other and they weren`t able to kind of get their story straight. And that`s why there was a need to do it underground.

But this has been going on for a couple years now and I don`t think you`re really protecting against that much knowing that Mueller probably has interviewed the bulk of the witnesses. So now it`s time for the public to understand why this matters and what`s at stake.

HAYES: You`re also on House Judiciary Committee. I`ve talked to the Chair there too Jerry Nadler about the Attorney General of United States Mr. Whitaker who it`s unclear whether it he`s willing to come for your committee. But every day goes by and this individual who is being sued in three or four different lawsuits who is been ruled not an actually principal you know, necessitating Senate confirmation. Is the chief law enforcement officer of the U.S., will he come before your committee?

SWALWELL: Yes. He cannot hide from our committee as he would have been able to if Democrats have not won the Congress. Presidential immunity is over, Chris. We will subpoena him. That subpoena will be upheld in the courts and he`s going to have to defend his investigation and whether or not he`s made any promises to President Trump. We would rather see that done voluntarily. This is the United States. It shouldn`t be adversarial for the people`s Attorney General to come to Congress and tell the American people what his priorities are and whether he can uphold a lawful investigation.

HAYES: Do you anticipate that he will try to run out the clock because obviously there`s going to be confirmation hearings for William Barr who has been nominated to succeed him. But it seems to be important to get him there whether he`s the acting Attorney General or not. Do you agree?

SWALWELL: We`re not going to let that happen. You know, I know Chairman Nadler is determined to get him have a force. Now he may try but again, we have subpoena power and we are carrying ourselves with the confidence that this is what the American people wanted us to do, was to put a balance of power on these abuses of power.

HAYES: All right, Congressman Eric Swalwell, was that you`re extremely cute baby in the House the other day that I saw?

SWALWELL: Yes. All credit goes to my wife, Chris. I held her for three hours and I was called a hero. She does all the work including right now and gets none of the credit.

HAYES: How old is your little?

SWALWELL: She`s ten weeks.

HAYES: Oh wow. Well, congratulations. She was really adorable.

SWALWELL: Thank you. And I know you`re the dad of young kids too.

HAYES: Yes. It`s a lot of work. Elizabeth Warren`s big camping kickoff in Iowa this weekend. What you are not hearing about what Democratic primary voters are saying next.


HAYES: There are two campaigns taking place the presidential nomination in the Democratic Party in 2020. There`s the national campaign which has narratives and press coverage and whispers about who is and who is not running and why and who`s getting which donors, and then there`s the actual honest-to-god press the flesh talk to voters campaign that got underway for real this weekend when Elizabeth Warren addressed a string of overflowed crowds in the early caucus state of Iowa.

"New York Times" politics reporter, Astead Herndon, observing that contrary to the, well, sometimes extremely bitter back and forth among, say, online political junkies, the mood among actual voters was upbeat and enthused.

As the 2020 nomination process begins, he wrote, "Iowa voters are giddy at the prospect of a crowded field that could feature more than a dozen candidates across the ideological spectrum.

And Astead Herndon, national politics reporter at The New York Times joins me now along with New York Times columnist Michelle Goldberg.

It was really good campaign reporting. Tell me about this giddiness. I thought it was a good counterpoint to the idea of like who is going to be able to beat Trump? And is it a new face? Like people are excited to have an opportunity to do a little kicking of the tires.

ASTEAD Herndon, NEW YORK TIMES: Yeah, thank you. I think this is really what we`re seeing from voters right now is that it`s early and they understand it`s going to be a long process. And they want that process to have a robust discussion of ideas.

They are kind of frustrated from a 2016 primary which they felt was two rigid lanes where it was a little bitter back and forth. And coming out of that, they don`t want to rehash that all over again.

HAYES: It was like you were one or the other, because it was only two real options.

HERNDON: You were on separate teams. They were telling me these horror stories of caucus night and how bitter it was. And they`re saying this time, even though it`s going to be a lot more people, we want a primary where it`s policy focused, where -- and how -- and they like multiple candidates, even if i support Elizabeth Warren, I also kind of like Cory Booker or I also like someone else, and so that makes for a much more pleasant experience.

HAYES: It`s interesting the way in which this will resonate in terms of having 20 candidates, reducing the kind of acrimony, because you don`t have this kind of forced choice.

MICHELLE GOLDBERG, NEW YORK TIMES: Right, yeah, so everybody -- and also then you end up having some kind of overlap and sometimes some unexpected overlap, right. We were talking in the break about someone you interviewed whose choices are Elizabeth Warren and Michael Bloomberg, right. So you kind of get to see how -- you know, I think there`s a lot of people who just want to see who catches fire.

HAYES: Right.

GOLDBERG: So, there`s an element...

HAYES: They want the phenomenon, the sensation.

GOLDBERG: Right, but there`s like an element of politics that`s not reducible to demographics, it`s not even necessarily reducible to policy or kind of checking any of the boxes. There is some sort of magic that happens when somebody gets in front of a group of people and you see how they interact.

HAYES: Well, I thought that one of the things that came through in the clips I saw and the coverage I read is that Warren, you know, her announcement was there was a sort of national narratives about like did she stumble with the DNA test and was it past her time? But she`s quite adept at these kinds of rooms and got a very good -- like she`s good at that. That`s a thing she`s good at.

HERNDON: Right, there was a moment this weekend where I thought, you know, like, there was so much conversation about things that weren`t her political skill. And this weekend was a good reminder of why this was such a phenomenon in the first place. I mean, this is someone who goes into those room, can capture those audiences, and has a clear message about how they think the government should work, and how the government should work, and has a record of advocating for middle class, working class people that people resonate with.

And so the second that she was able to get back to that, the second it was done with the Washington chit chat and insider stuff, she was back on her home turf and that`s where she really succeeds.

HAYES: You know, there was an interesting moment that you highlight in a tweet that I want to play that I thought was a real window into the Democratic Party base. Iowa is a very white state. Even the Democratic primary voting base is overwhelmingly white in that state, because of the demographics. Here is a moment where she`s talking about sort of race and class and economics. Take a listen.


SEN. ELIZABETH WARREN, (D) MASSACHUSETTS: What`s happening to working families in this country? Why is it getting harder and harder for young people to be able to build some security? Why is the path getting rockier, and particularly rockier for people of color? Why is that happening in this country?


HAYES: And you notice that -- you noted like that got -- when she talked about race, when she talked about the black/white racial -- it got huge applause in these mostly white rooms. And I think that`s a really important dynamic the way that race gets talk about, and the enthusiasm white Democratic primary voters have for that kind of language.

GOLDBERG: Well, don`t you think it has something to do with, again, people being over the two lanes that dominated in 2016 where we were also having this really bitter debate about identity versus class. And I think they want somebody who can thread that needle and speak to those two things holistically.

And you know I`ve often been really down on the Iowa caucuses and the disproportionate attention that Iowa gets in this process.

HAYES: Because it`s not particularly representative.

GOLDBERG: Right, exactly. It`s this like very white, unrepresentative state that everybody sort of focuses all their attention, but there is something about having a relatively small group of people that is going to put in the time to listen to kind of relatively complicated policy proposals and sort of adjudicate them outside of any dumb narratives coming from D.C. or New York.

HAYES: Right.

Last data point, which I think dovetails this, was just one of the big trends of this era is the increasing racial liberalism of Democrat white voters, like when they talk about race, when they think about are black people getting ahead or not getting ahead because of the reasons. Like we can see it in the data.

This is from polling from New Hampshire, also a very white state. Among Democratic primary voters: unions 64 percent, Black Lives Matter is 72 percent favorable -- 13 percent -- and big corporations 8 percent favorable, 65 percent unfavorable.

Like that`s a pretty left group.

HERNDON: Yeah, and you`re going to have to see these candidates, black or white, speak to those issues. And that`s not just going to come from activists, those are coming from but voters...

HAYES: Base white voters.

HERNDON: Base voters who believe this is something, that needle has to be thread between not just economic populism but racial justice.

HAYES: I thought that was a very -- really one of the more interesting dynamics of this weekend. You did a great job chronicling it. Astead Herndon and Michelle Goldberg, thank you for joining us.

Coming up, just days into the new congress, Alexandria Ocasio-Cortez and the new Democratic class, setting the agenda for policy debates. The AOC affect coming up.

Plus, Mick Mulvaney is on his hustle. That`s tonight`s Thing One, Thing Two next.


HAYES: Thing One tonight, the president is having such a hard time getting people to come work for him that basically every open job that comes up he gives it to Mick Mulvaney whether he wants it or not.

The former congressman from South Carolina first came on board as the director of Office and Management and Budget. And then near the end of 2017 he added a second job as director of the Consumer Financial Protection Bureau.

Late in 2018, Mulvaney made the mistake of being in the White House on a day that Trump had no one to replace John Kelly. And so he kept the first job, dropped the second job and then also became Trump acting chief of staff.

Now, Mulvaney reportedly insisted on that acting in the title, you know, just in case some other great job opportunity came up, or maybe he already had his eyes on his fifth job in three years. That`s Thing Two in 60 seconds.


HAYES: Mick Mulvaney, jack-of-all-trades in the Trump administration, is reportedly working on an exit plan. According to New York Times, late in 2018 Mulvaney explored the possibility of becoming the president of the University of South Carolina. That was before he got stuck with Trump`s acting chief of staff job. And of course he has that other job as OMB director as well. But as of last week, a person close to Mr. Mulvaney said he`s still interested in the presidency of his home state university, which will become open this summer.

The White House is, of course, pushing back. Spokesman Hogan Gidley says Mick Mulvaney is focused on faithfully executing the job the president has asked him to do and as such he is not interested in any other positions.

Are you sure about that, Hogan?


MICK MULVANEY, ACTING WHITE HOUSE CHIEF OF STAFF: I`m the acting chief of staff. I`m retaining my formal position at the Office of Management and Budget for now. 100 percent of my time is in the West Wing as the...

CHUCK TODD, HOST, MEET THE PRESS: What does "for now" mean? When you say "for now," there`s a chance you do vacant the position?

MULVANEY: Well, you know, it`s like a good question. So, no one asked me about that before, about how the president and I talked about doing this is that we just decided to try it. I think the president had some ideas about how to run the position that was different than John Kelly, a little bit different than Reince Priebus. And the president said let`s try that, that`s a great idea, let`s give that a shot for a while.

And I said, that`s great. If you don`t like it, you`ve always liked what I do at OMB, I can go back across the street and go back to doing that.

TODD: Is this a 90 day trial, a 180 day trial?

MULVANEY: We didn`t talk specifics, so...

TODD: So, your goal is to keep the acting title until he`s satisfied hat you want to be full time.

MULVANEY: My goal is to make the president successful. I think we had a pretty good week on that. If we can have a good couple more months on that, I think that would be great.



HAYES: Democrats tonight are demanding air time equal to what President Trump receives tomorrow for his Oval Office address. Senate Democratic Leader Chuck Schumer and Speaker Nancy Pelosi releasing a joint statement tonight saying that if the president`s past statements are any indication, tomorrows address, quote, will be full of malice and misinformation.

Where is the lie?

When asked who the Democrats might put forward for the statement, a Schumer spokesperson told NBC News, quote, "we await a response to the networks." Meanwhile, Republicans are tied in knots responding themselves to new Democratic freshman lawmaker, Democratic Congresswoman Alexandria Ocasio- Cortez.

And her ability to command the national conversation is something to behold. She has been using that to put attention on policy conversations in a really interesting direction.

In her 60 Minutes interview, she mentioned a 70 percent top marginal tax rate on income exceeding $10 million. And somehow now, less than 24 hours later, there is a boisterous public debate about the possibility of a 70 percent top marginal tax rate for income exceeding $10 million.

Conservative tax hawk Grover Norquist is freaking out. House Minority Whip Steve Scalise revealing he doesn`t appear to understand how marginal tax rates work. Paul Krugman, a Nobel Prize winning economist taking to the pages of The New York Times to defend Ocasio-Cortez`s proposal. He points out that respected economists advocate for a 70 to 80 percent marginal tax rate. And he adds, quote, "it`s a policy nobody has ever implemented aside from the United States for 35 years after World War II, including the most successful period of economic growth in our history."

For most of my adult life, Democrats have been in a weird defensive crouch about policy ideas unless they were doing things like defending Medicare and Social Security, which they knew are super popular. So, it`s wild to watch this generation, Ocasio-Cortez, but not just her, stake their claim to new ideas and set the table for debate. And we`re only four days into this new era. The AOC effect next.



UNIDENTIFIED MALE: Alexandria Ocasio-Cortez has this green agenda, which has to be paid for with money from the rich. It simply won`t work.

UNIDENTIFIED MALE: Well, I think right now we need to know what this means. It`s a warmed over slogan.

JENNA ELLIS, ATTORNEY: These types policies are not only unconstitutional, but they`re morally wrong and just bad politics.


HAYES: The right has spending a lot of time talking about Congresswoman Alexandria Ocasio-Cortez and her policy ideas. But their panic attacks only underscore her ability to set the agenda even though she`s only been a member of congress since Thursday.

Here to talk about why that is, Alexis Goldstein, a senior policy analyst for Americans for Financial Reform; Waleed Shahid, who is a former senior staffer to AOC`s campaign and a spokesperson for Justice Democrats; and Jared Bernstein, a senior fellow at the Center on Budget and Policy Priorities, and former chief economist for Vice President Joe Biden.

Alexis, I`ll start with you as someone who has sort of moved in Washington policy circles, particularly around things like -- in the sphere of financial reform and regulation. What is different now? It seems to me that not just the way that Ocasio-Cortez talks about this, but other Democrats as well, have been sort of pushing the agenda, setting stakes in ways we haven`t seen before.

ALEXIS GOLDSTEIN, AMERICANS FOR FINANCIAL REFORM: It`s really fascinating, and Representative Ocasio-Cortez before she was a congresswoman made waves with this bill that past in May of last year that rolled back all these rules on Wall Street and basically said we didn`t need all of automatic monitoring on the really big banks. And she called out Democrats in a really big way and said this is a bad idea. And she was on the same side as every single2020 Democratic primary contender, not just the Elizabeth Warren and Bernie Sanders of the world, but Gillibrand, Booker, Kamala Harris, all of them voted against this big deregulatory package.

So, in some ways I feel like the split in the Democratic Party, right, are we going to be the party of the workers and families, or are we going to be the party that chooses the wealthy and give them big tax breaks, has been in the works for awhile and Ocasio-Cortez has sort of been on the forefront of it, but she`s by no means the only one. And so I would sort of argue that the people vying for the top of the ticket have seen that this is the way to go for awhile.

HAYES: Right, but there is -- so there is two things. There are the politics of sort of whose side are you on and this sort of left/right spectrum, but Jared, what I find fascinating here is this idea of the overtone window, like, saying things that seem crazy at first and then they come to seem not crazy.

So like in the beginning, getting rid of the estate tax was crazy. Like why would you get rid of the estate tax? It`s going back to Andrew Carnegie writing essays about how important it is for inherited wealth to be taxed and then all of a sudden it worked its way into the middle of the conversation.

I haven`t seen Democrats do that in reverse in the same way. And you`ve been on the inside and outside in politicians for a long time. What do you think?

JARED BERNSTEIN, CENTER OF BUDGET AND POLICY PRIORITIES: Well, I haven`t seen Democrats do that either except for last week and so you`re absolutely right, this is a remarkably quick transformation and one that`s been such a long time coming. And by the way, it`s one of the reasons -- and I agree, it`s not just Congresswoman Ocasio-Cortez, but it`s one of the reasons why a lot of us are just feeling downright excited about the possibilities of opening that window and having conversations we haven`t been able to have for decades.

Now, that doesn`t mean anything is going to be legislated tomorrow or perhaps even over the next couple years, but that`s no reason not to open the window, set the table, and start having a conversation we should have been having a long time ago.

HAYES: Do you have a theory of this, Whaleed, as someone who worked on that campaign about like big, simple, grand policy proposals as opposed to sort of like, you know, the high point of the Clintonesque in the `90s, right, where there was divided government and it was like, you know, cards inside TVs to block bad parenting, you know, bad content and school uniforms.

This is kind of the opposite of that. Is that like a realized theory about how to talk about politics?

WALEED SHAHID, SPOKESPERSON JUSTICE DEMOCRATS: Yeah, totally. I mean, the Clinton-style Democrats of that era are totally out of touch where the Democratic Party primary voters are in 2020. A lot of the people at the top of the Democratic Party who are wealthier or more white, more male than the bottom of the party, they grew up at a time of Richard Nixon and Ronald Reagan and they have been made to be afraid of the strong Democratic Party ideas like the new deal on the great society and new deal liberalism. And now Alexandria Ocasio- Cortez and that whole generation of Democrats is no longer -- they are not part of the generation.

HAYES: I think there is something generational. And I also think, just to argue on the other side, devil`s advocate, like part of it is like the hard -- it was hard -- it`s battle scars from getting their butts kicked. I mean, there is lots of Democrats who have whether it was the McGovern loss or whether it was Bill Clinton when he lost -- when he got kicked out of the governor`s seat after one term, there is a lot of battle scars those folks have they still carry with them.

SHAHID: But say what you will about Millennials, we just didn`t experience that...

HAYES: Right, no, totally, yes.

SHAHID: The deal was Occupy Wall Street, Hurricane Katrina, the Iraq War, the financial crash on Wall Street, and we know that we want solutions that are as big as the problems we face. And that`s why the green new deal is catching on. People want these bold, exciting ideas. They don`t want this mealy-mouthed, reduce the deficit, balance the budget kind of talking points that...

GOLDSTEIN: Chris, if I may just break in there. I think part of what is the phenomenon of Representative Ocasio-Cortez is she`s willing to tell the truth about how much of a lie so much of the sort of over reaction is, right. Like, oh, we can`t tax the wealthy because then the economy will crash. Like, the same people telling you that are the people who crashed the economy the last time, right?

And these are folks, Millennials, who have come of age in crisis after crisis after crisis, and so.

HAYES: Right.

BERNSTEIN: But there is -- sorry, go ahead.

HAYES: Go ahead, no you go.

BERNSTEIN: There is something else going on here. You know, I`m old enough to remember a time when actually a lot of members of congress believed in an amply funded functional government sector that actually addressed and tried to solve the problems we face. It`s only over the last 10, 15 years that you have a major party that feels completely and acts in completely the opposite direction. Send me to Washington, I`ll make sure it stays broken and unfunded.

Interestingly, I see many of these new members harking back not just to a tax code, by the way, that worked very well for America in an earlier period, but also to a form of government that potentially works better. And what`s particularly exciting is it`s such a diverse crowd that they are bringing to the table.

HAYES: You know, so here is -- the green new deal is a for example, you just mentioned it, right. Like, it`s great because it`s simple and bold and like, oh, the new deal was great, and green, everyone loves green. So, you put them together and it`s sort of unclear what it means, but I think that that amorphousness can be politically advantageous.

The danger, though, is that you end up with a situation like the wall in the other direction. Like, the wall was useful...

SHAHID: For body cameras and Black Lives Matter.

HAYES: Right, like the wall was useful because it was like everyone could project their image, but then you have got to govern. You have got to make the thing happen. Like, do you think about that?

SHAHID: Totally. I mean, we`re not at the point where we are going to be able to pass legislation on it, but right now, like, she`s in the tradition of the new dealers and abolitionists and the civil rights leaders who are trying to put together a moral agenda of what she believes is actually necessary to solve the economic and climate and social crisis in this country.

But at the end of the day, she does want to deliver for working people and her district.

HAYES: I guess my point, Alexis as someone -- Alexis and Jared, you guys are both like policy wonks. But like the devil is in the details. At some point, people who govern have to work out the details or you end up with a shutdown over a wall.

GOLDSTEIN: Yeah, but we also just made a huge investment in wealthy people this time last year, right? And so now there is this new generation saying well instead of investing in millionaires and billionaires, let`s invest the same amount of money, right, $2 trillion dollar Trump tax scram in something like a green new deal.

And it`s like, it`s been a failure of an imagination, so I`m as excited as Jared about the new creativity.

HAYES: Jared?

BERNSTEIN: And, yeah, so one of the -- look, it matter a great deal whether your abstraction is evil, or whether your abstraction is positive.

HAYES: That`s a good point.

BERNSTEIN: The wall is an...

HAYES: ...strong distinction.

BERNSTEIN: ...evil, racist abstraction, the green new deal is a progressive, environmentally progressive abstraction.

HAYES: Yeah, and we`ll see how they get colored in. Alexis Goldstein, Waleed Shahid, and Jared Bernstein, thanks for being here.

All right, some fun news tonight, I will be on Late Night with Seth Meyers. It is always a treat to be on the show. I love being on the show. Tonight, we talked about everything from the origin of Trump`s wall fixation to the brand new congress in Washington, D.C., to what tactics Democrats might deploy in 2020. Great discussion, very fun time, make sure to stay up and check it out. That`s tonight, 12:35 a.m. Eastern on NBC.

That is ALL IN for this evening. "THE RACHEL MADDOW SHOW" starts right now.