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Trump caves on border wall. TRANSCRIPT: 1/25/2019, All In w. Chris Hayes.

Guests: Marcy Wheeler, Harry Litman, Ron Wyden, Rick Perlstein, Richard Blumenthal, Michael Steele, Danielle Moody-Mills, Asawin Suebsaeng, Neal Katyal

Show: ALL IN with CHRIS HAYES Date: January 25, 2019 Guest: Marcy Wheeler, Harry Litman, Ron Wyden, Rick Perlstein, Richard Blumenthal, Michael Steele, Danielle Moody-Mills, Asawin Suebsaeng, Neal Katyal

CHRIS MATTHEWS, MSNBC HOST: He doesn`t quit. This brings me back to on what Roger Stone once said about it, it better be infamous than not famous at all. That`s something I can imagine Richard Nixon himself saying as if he was outrageous a character as Roger Stone. And that`s HARDBALL for now. "ALL IN" with Chris Hayes starts right now.



AMERICAN CROWD: Lock him up. Lock him up.

ROGER STONE, ASSOCIATE OF DONALD TRUMP: I found it disturbing that the Special Counsel`s Office released a press release prior to informing --

HAYES: Roger Stone`s time in the barrel.

STONE: Oh my God, I`m busted.

HAYES: As the Trump shut down finally ends.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We do not need 2,000 miles of concrete wall from sea to shiny sea.

HAYES: Tonight for the first time, the Special Counsel links the Trump campaign to WikiLeaks.

TRUMP: I love reading those WikiLeaks.

HAYES: Roger Stone charged with seven counts.

TRUMP: Well, Roger is a good guy and he is a patriot.

HAYES: Plus, what it all means for the President.

TRUMP: Russia, if you`re listening --

HAYES: And all the President`s men.


HAYES: And it was a shutdown inspired by Steve King, Ann Coulter and Trump T.V.

UNIDENTIFIED MALE: This is manufactured.

HAYES: Enabled by Mitch McConnell.


HAYES: And executed by President Donald Trump.

TRUMP: I am proud to shut down the government.

HAYES: The political fallout begins as the Trump shutdown ends.


TRUMP: Build that wall.

HAYES: When ALL IN starts right now.


HAYES: Good evening from New York, I`m Chris Hayes. It was a bad day for Donald Trump and a good day for America. In a presidency that`s had its fair share of low points both morally and politically, today has to be one of the worst, the President backing down in total abject humiliation from a fight that he himself started conceding to end the record-setting government shutdown that he engineered to extort funding for a border wall that he promised Mexico would pay for.

In the face of united opposition from Democrats in Congress and the beginnings of what looked to be a full-scale labor uprising within the nation`s aviation system, the president and his party accepted defeat agreeing to reopen the government without wall funding. As the Washington Post`s Aar0n Blake put it, calling this a deal between Democrats and the GOP is kind of like calling the Treaty of Versailles a deal between the allies in Germany.

After the longest shutdown in U.S. history, hundreds of thousands of federal workers will now be able to return to their jobs and collect back pay for their unpaid work, not true however for federal contractors. We`ll see where that ends up. That also includes payment for the FBI agents who showed up this morning in military-style gear before the break of dawn to arrest the President`s oldest and closest political advisor Roger Stone at his home in Florida hauled him away in handcuffs.

The Special Counsel indicted Roger Stone on seven counts of lying to Congress, obstruction and witness tampering in an attempted cover-up of Stone`s efforts to get dirt on Hillary Clinton from WikiLeaks in 2016. And for the first time ever, the indictment traces those efforts directly back to the President`s campaign.

According to Robert Mueller, after the July 22nd, 2016 release of stolen DNC e-mails by Organization One, WikiLeaks, a senior Trump campaign official was directed to contact Stone about any additional releases and what other damaging information Organization One had regarding the Clinton campaign.

We don`t know who it was that did directing, but it would have to be someone high-ranking enough to give orders to a senior campaign official. It kind of makes you wonder. And that came just a few days before the candidate himself did his own fishing for Clinton dirt.


TRUMP: Russia, if you`re listening, I hope you`re able to find the 30,000 e-mails that are missing. I think you will probably be rewarded mightily by our press.


HAYES: Months later, when WikiLeaks released the first batch of hacked John Podesta e-mails less than an hour after the Access Hollywood Tape came out, an associate of a high-ranking Trump campaign official who was believed to be Steve Bannon sent a text message to Stone that read, "well done." That`s kind of interesting too.

Indictment to pick Stone moving his communications to secret channels scrambling to get his story straight with other witnesses and repeatedly threatening a witness who was preparing to come clean. But while prosecutors lay out both Stone`s cover-up and his original efforts to get in touch with WikiLeaks, whether or not he actually made contact remains a mystery.

Did Stone manage to get real information on the materials stolen by Russian hackers or was it all just a bluff as he now maintains. Either way, there`s reason to suspect that Robert Mueller hasn`t finished with Roger Stone. This morning, FBI agents spent hours seizing files and other items from Stone`s apartment here in New York.

I`m joined now by Marcy Wheeler, independent journalist who writes about national security and civil liberties, have been following this case as closely as anyone and Ben Wittes, Editor-in-Chief of Lawfare Blog and an MSNBC Legal Contributor. Marcy, I`ll start with you. What jumps out at you about this development and what we have learned from it?

MARCY WHEELER, INDEPENDENT JOURNALIST: The two things that jumped out to me are one, the way that they went after Stone, the pre-dawn raid. There are law enforcement reasons why they had to do that but nevertheless that - - Manafort did not get that treatment. No one else has gotten that treatment. You know, they came after Roger before the lights came on during the day.

The other thing you`ve already talked about, that reference to was directed a week after we`ve been fighting all week about whether BuzzFeed should have used that word directed in a headline about Michael Cohen. Well, now we`re using it at courtesy of Robert Mueller. And you`re right, there aren`t that many people in the campaign who could have directed that kind of -- that kind of order to a to a top campaign official.

HAYES: Ben, how about you, what are your big takeaways?

BEN WITTES, MSNBC LEGAL CONTRIBUTOR: So my big takeaway is that the President`s whole argument about the Russia story from the beginning has been that his campaign and he have nothing to do with Russia. And the special counsel was appointed to investigate among other things Russian intervention in the 2016 election and coordination between that activity and anyone associated with the Trump campaign.

This is not quite a collusion indictment but it is very much a coordination indictment because what Roger Stone is accused of doing here is lying about his coordination between WikiLeaks and the Trump campaign. And so I think it`s a very -- like a lot of the facts in this indictment were publicly known and have been publicly reported by major media before but it is very different when the United States and the person of the special counsel puts it down on paper, signs his name to it, the grand jury foreman you know, represents that it is the work of the grand jury, and this is a statement of the United States that there was coordination by Roger Stone between the Trump campaign and Russian activity in the 2000 election -- 2016 election.

HAYES: You know, Marcy, one of the things that`s striking to me is you have Stone sort of scampering around trying to get to WikiLeaks in the indictment. You know, if you have -- this is Corsi -- this is Corsi in an interview but it`s sort of part of the indictment. He said that Stone claimed to have advance knowledge of the Billy Bush tape and that the GOP operative told him if you have any way to get Assange to start dropping, tell him to start dumping, right?

So he`s trying to coordinate these leaks. And then we get him on the backside trying to cover up and lie about it before Congress. But the actual thing in the middle, right, which is was there an actual back- channel, did they effectively coordinate, that is not in there. What do you think about that missing part of this?

WHEELER: There are a few other missing parts. For example there`s no explicit reference to Ted Malloch to Nigel Farage. We know that Roger Stone was meeting -- had meetings with both of them in that time period. We don`t -- you know, that they`re -- like I`ve shown that the themes that Corsi and Stone were pushing in August particularly an argument about Podesta having ties to Russia. Those started coming out from Corsi and Stone before the e-mails started dropping in October.

So you would think, yes -- I mean, the evidence is there to suggest that`s where they`re going. Maybe you know, that`s what the FBI spent hours looking for in Roger`s homes today to see whether they had those Podesta e- mails in some form that didn`t come via WikiLeaks. I am -- one of the points I made later in the day is you know, Roger Stone was willing to go to great lengths to set up these cover stories inside cover stories, inside cover stories, but what he didn`t do according to -- according to the indictment is delete these e-mails.

HAYES: Right.

WHEELER: Delete these texts that showed him collecting on. So that says you know, this guy who has spent his entire life doing cover-ups, didn`t do the most basic things to engage in a cover-up so there`s probably a lot more in his homes that now is in the FBI`s possession.

HAYES: There`s also the fact, Ben, that this now brings us to we have Michael Cohen who`s pleaded to a number of crimes lying to Congress, also campaign finance violations that he says was direct by the President. Michael Flynn has pleaded, George Papadopoulos has pleaded. Paul Manafort convicted, Rick Gates, and now Roger Stone indicted. It is -- when you take a step back and think about the circle around this man, the President, and his campaign and the criminality in evidence of those people, it`s something that contemplated.

WITTES: It`s amazing. And you haven`t mentioned his national security advisor, and you haven`t mentioned his campaign aide George Papadopoulos both of whom pled guilty to lying about contacts with Russian officials or Russian intelligence cutout. And so -- I mean, I think when you -- when you draw the circle around you know, who were the people close to Trump in the campaign period and the transition period, and then you start crossing off the ones who have pled guilty to things or who have been indicted for things, you end up with -- you end up with a sharply diminished pool.

And the closer people are the more likely they are to have problems. And that does suggest a you know, a kind of tightening of the circle, closing of the ring, whatever metaphor you want to use that you know has to concern the President if he`s thinking about it carefully.

HAYES: Also if he`s reading them, thinking who did direct him to do that. Did I -- I think I, maybe. Marcy Wheeler and Ben Wittes, thank you both. Joining me now is Harry Litman, former Deputy Assistant Attorney General and Contributing Columnist for the Washington Post and Mimi Roca former assistant U.S. attorney in the Southern District of New York and an MSNBC Legal Analyst.

Harry let me start with you on was directed which strikes me as the most flashing neon sign in the indictment and also the most legal significance for the president. I`ll read this again and I want to get what your reaction to it is. After July 22nd, 2016, release of stolen DNC e-mails by Organization One, a senior Trump campaign official was directed, amazing use of the passive voice, to contact Stone about any additional releases and what other damaging information Organization One had regarding the campaign. What do you think of that?

HARRY LITMAN, CONTRIBUTING COLUMNIST, WASHINGTON POST: Yes. An instantly famous use of the -- of the passive voice, right? You could have -- he could have as he did another narrative sort of identify but not name an individual, Trump, but that wouldn`t have been part of the narrative of this indictment. So it screams out. Now, it`s almost certain that the directee here is Steve Bannon. So who can boss Steve Bannon around and direct him to shake the tree and get and get Roger Stone to push on Wikileaks?

Certainly -- if Robert Mueller is no teaser and it would be quite at ease if this were anyone other than the president. That`s for --

HAYES: You think so.

LITMAN: Yes, that`s for -- certainly, he knows that speculation will be there. They fly spec the indictment. Michael Dreeben, you know the wordsmith and the -- and the team thought carefully about this use of passive voice. They`ll stitch it up or not in coming days. I want to also point all the focus has been in Paragraph 12 where this passive voice is. We`re going to be hearing tomorrow a lot more about Paragraphs 13 through 15 where you really have -- I would say this goes a step farther than a coordination indictment. It`s something of an effectuation indictment.

That is you really see Stone about the business of pushing on Wikileaks who now, by the way, we have to consider Julian Assange an avowed enemy of the United States working with him to really try to make this happen. That is the stuff of conspiracy and whether or not he actually had the direct communication and contact with him. The attempts there are going to go farther than simply a process crime as it were. This is really trying to shake loose the info.

HAYES: Yes. That`s -- I mean I guess that`s the next question right. So we have all so many of these charges and pleas have been about lying right, Mimi. And what I`ve been told is that that is because it`s a -- it`s a clear-cut chargeable thing and provable thing for a prosecutor undertake. And the question I guess is, is this what there is or is this what they could charge based on your expert opinion?

MIMI ROCAH, MSNBC LEGAL ANALYST: It`s a great question and it`s obviously the question of the day once we all absorb you know, the actual charges and arrest this morning. My sense is there`s more to come as to Roger Stone and others because for a couple of reasons. First of all, Mueller did not have to lay out all of these facts a reason for the obstruction charges that he brought against Stone. So he gave us once again more information that -- which is perfectly permissible to speaking indictment. But he`s laying it out there for a reason to inform the public and to say you know, it`s those breadcrumbs, there`s more to come.

Second of all, you know, he did effectuate search warrants today in two different places. If you bring charges and you have sort of ready-made charges and maybe you have other possible charges to bring, but you`re not quite there yet, then you bring the charges you`re ready to bring and you execute search warrants and you hope that you get that little bit more that you need, because there is a lot here already. As Harry was saying, as people have been saying throughout the day, there`s just so many facts in this indictment about -- I`ll use the word coordination from the Trump campaign to WikiLeaks through Roger Stone.

And remember, that GRU indictment, you know, if you go back to that, one of the objects of the conspiracy, it`s not just hacking, it`s hacking and disseminating. And this to me, these facts really -- and you know and you can`t look at them alone. You have to go back to everything we know, the Trump Tower meeting, the you know, the calling out by Trump to Russia, the repeated calls of WikiLeaks. I mean, there`s just so many other things in there that I think can come together to fill in those holes.

HAYES: You know, part of -- part of what it occurs to me Harry too that we`re encountering here is that intelligence services are experts in plausible deniability. It`s literally what they do, right? So, in this case, you have the GRU doing the hack and then maybe there`s some cut out by -- to get it to WikiLeaks, and there`s WikiLeaks and then WikiLeaks has some intermediary to Roger Stone and Roger Stone isn`t technically part of the campaign and he has some connections. So you`ve got -- you know, you attenuate this chain, right, is that the GRU doesn`t hack the e-mail show up in Trump Tower and hand it to Donald Trump if to the extent that you have an attenuated chain.

And I guess the question legally is at what point does that chain become attenuated enough that you can`t charge anyone or you can`t get them on the actual transfer?

LITMAN: Right. The short answer legally is it doesn`t have to go very far if you want to charge a conspiracy or an attempt which I -- which I think we may well be seeing. And I want a second both Mimi and Marcy`s point that it`s going to be a treasure. Stone is one garrulous and colorful fellow and the search is going to turn up quite a number of e-mails of the like that he has already sent. But it`s the interesting part of the whole counterintelligence side of this thing.

As you say, there is once you get into sort of the espionage world, it`s all a hall of mirrors and denials and plausible counter ways of portraying these things, and GRU and the Trump Organization are experts at sort of sussing out how to make it seem that there is at least confusing the matter about what has been going on. But as a legal matter, I think it will be straight forward. Of course, when you come to Trump, it`s less the legal matter and more the political matter and how will this sound to the members of Congress.

HAYES: Which brings us, Mimi, to Roger Stone who of course has been very public about he`ll never roll on the President. The President tweeting you know, back in December 3rd. I will never testify against Trump. The statement was recently made by Roger Stone essentially saying he will not be forced by a rogue amount of controlled prosecutor to make up lies and stories about "President Trump." Nice to know that some people still have guts, in quotation marks.

Obviously, it seems to me like Mueller is trying to get him to cooperate because he`s given him an even sort of harsher treatment than Manafort in terms of the dawn raid with the SWAT team. Is that your read of that behavior?

ROCAH: No. Actually it`s not. I -- look, I think there were real law- enforcement reasons for them to do the pre-dawn. I mean, the pre-dawn arrest is the norm, not the exception. You know, I understand Manafort was allowed to surrender. But remember, Stone is this kind of charged with obstruction. He`s someone who has repeatedly lying. He`s charged with witness tampering. Those are the kind of people that you`re normally not going to let surrender especially when you want to do simultaneous search warrants in two places. You don`t want to tip them off that --

HAYES: Right.

ROCAH: Hey, you know, those e-mails you forgot to delete, you might want to go do that now. So I really do think that that was you know par for the course of this kind of charge and case. Also, I will say this, when Michael Cohen you know, was arrested and everyone kept playing him saying I`ll take a bullet for the president, I was one of the people who said yes, I don`t think so. He`s going to cooperate. And he did. Albeit you know, not totally fully but he`s cooperating.

I do not think that of Roger Stone. I do not know that this man is capable of becoming a trustworthy cooperator even if you tried. I just cannot imagine a prosecutor ever embracing him.

HAYES: I think that`s probably right. Harry Litman and Mimi Rocah, thanks you both. Democratic Senator Ron Wyden of Oregon, member of the Intelligence Committee joins me now. Your reaction, Senator, to the indictment for lying to Congress and if I`m not mistaken lying to your committee or I guess the House committee of Roger Stone.

SEN. RON WYDEN (D), OREGON: Chris here`s where we are and I don`t think it is just the lies of these Trump lieutenants, it is what they were lying about. And what they were lying about is colluding with the Russians.

HAYES: Right.

WYDEN: Today, of course, it is Stone with WikiLeaks. Before it was Stone -- excuse me -- with Cohen with the Moscow Tower, something I`ve really focused on because I think the money issues are crucial in this, to follow the money questions. Then we have Paul Manafort who is indicted in effect for trying to make polling data available to a Russian spy.

Anybody who`s been through elections like Senators know you really guard polling data. You give up polling data if you`re trying to influence an election. What these folks were doing was colluding with the Russians.

HAYES: Yes. I guess the question is, in terms of the publicly known facts, there`s two possible theories. They were colluding with the Russians and trying to cover it up or this is just an incredibly bumbling group of almost congenitally criminal individuals who just lie and cover up as a matter of course even when they don`t have a crime to cover up. Does that second one seem at all plausible to you?

WYDEN: Well, my sense is that as you look back at these events, the Trump Organization is right at the center of this so there is still a lot more to come. I think one of the things we`re going to be asking about on the Intelligence Committee and this is a public matter or not classified, who is this unnamed individual we heard about today.

This unnamed individual could come out and Bob Mueller`s report and I want to make a little bit of news on your show, Chris. I`m just mystified by this idea that the Mueller report shouldn`t be made public. And I just want to say tonight if there is any effort to keep the Mueller report the truth from the American people, I`m going to lead a fight on the floor of the United States Senate to make sure that that report with appropriate redactions to protect sensitive matters, I`m going to make sure that it gets in the hands of the American people. I don`t think I`ll be the only centers doing it by the way.

HAYES: Do you have the power to do that?

WYDEN: Sure. I mean, when you`re on the Intelligence Committee, you have to protect what are called sources and methods. You know, we don`t compromise on matters that could put at-risk Americans. But you can certainly go to the floor of the United States Senate and make a very aggressive push to make sure that the American people get the truth and you just asked about what`s coming up. That unnamed individual that we heard about today is exactly the kind of question that needs to be addressed for the public.

HAYES: What is your view in both your role as a Senator who has real civil liberties concerns and a strong record on civil liberties and also remember the Senate Intelligence Committee about the status of WikiLeaks because that is going to become an extremely germane issue very, very soon whether it is fundamentally part of a foreign hostile intelligence apparatus or a publisher like say the New York Times.

WYDEN: I`ve had real reservations about putting them in a box. We still have questions with respect to whether or not WikiLeaks engaged in criminal acts specifically. Obviously, I am very troubled about their role with respect to public evidence on their undermining -- trying to undermine American elections, but there are a lot of unanswered questions here.

HAYES: All right, Senator Ron Wyden, we will have you back as this developed and follow up on that pledge to bring this out in the light something that we believe into here as well. Thank you very much.

WYDEN: Thank you.

HAYES: He was a Nixon Dirty Trickster who has now been indicted the Mueller probe. Roger Stone`s road from Watergate to the Trump campaign with Rick Perlstein and Nick Akerman next.


HAYES: The freshly indicted Roger Stone has been a player in Republican politics for more than 40 years. Here`s a picture of him way back in 1985 and the guy next to stone is Lee Atwater, notorious hatchet man in the Republican politics, maybe the most infamous. Also he came up with the Willie Horton ad. And then on Stone`s other side is a guy you may recognize looks a little different now. His name is Paul Manafort.

These guys were partners at lobbying from Black, Manafort, Stone, and Kelly in the 1980s. Funnily enough, Manafort was also in federal court today before the same judge that now has the Stone case, a nice way for the two to be reunited. Stone was also crucial to Manafort getting the top job on the Trump campaign as none other than Paul Manafort himself will tell you in the documentary get me Roger Stone.


MANAFORT: Roger was one of the two or three people who strongly recommended me, yes. Even after Roger stopped being the principal political adviser to Trump, he continued to be a very important advisor in is to this day. Roger`s you know, relationship with Trump has been so interconnected that it`s hard to define what`s Roger and what`s Donald. Well, it`ll be clearly a Trump presidency, I think it`s influenced by a Stone philosophy,


HAYES: Joining me our Nick Akerman, former Assistant Special Watergate Prosecutor, and MSNBC Legal Analyst and Rick Perlstein, author of Nixonland. Nick, I want to start with you because you encounter Roger Stone as a Watergate prosecutor.


HAYES: Under what circumstances?

AKERMAN: This was to be precise in September 26, 1973. I was investigating an incident that occurred at May 3rd, 1972 on the Capitol Hill where the White House under Charles Colson who was the counsel to the president organized an event to try and maim or kill Daniel Ellsberg who was the publisher of the Pentagon Papers.

HAYES: Maim our kill?

AKERMAN: Maim or kill. At least one witness told me that he was instructed by two of the operatives from the White House and the committee to reelect the president that they would go for the Daniel Ellsberg and to maim or kill him. And the whole idea was that they brought up the same Cuban-Americans from Miami who were the same people that broke into the Watergate complex three weeks later.

HAYES: All right, so where does Stone fit in?

AKERMAN: Stone was part of a counter-demonstration on Capitol Hill that was also organized by Charles Colson, the counsel to the President, to deflect attention away from the Cuban-Americans who were then going to attack --

HAYES: Wait, they were like the shiny hand over here. Stone was staging a demonstration to take attention so that they could rush Daniel Ellsberg and --

AKERMAN: Exactly.

HAYES: But you interviewed Stone about his role.

AKERMAN: I did. I did.

HAYES: He didn`t know -- did he know they were going to try to maim or kill him?

AKERMAN: No, he did not. I mean, I don`t think he knew.

HAYES: He was like very junior --

AKERMAN: He was so junior. It was absurd. I mean, it used to be a joke in the office that I broke Roger.

HAYES: Nick -- Rick, you`ve covered stone for years. I think you`ve you interact with him quite a bit. I think you were messaging with him when he got --

RICK PERLSTEIN, AUTHOR, NIXONLAND: Yes. We could talk about that if you want to.

HAYES: Well, tell me, what is his role -- how central has he been in Republican politics because I think he`s often sort of oh that colorful Roger Stone is sort of a marginal figure but I`m not sure that`s quite the truth. What do you think?

PERLSTEIN: No, I think he was kind of a prototypical figure. He was a kind of a harbinger of things to come. So the thing he`s most famous for in Watergate is in 1972 he was basically drafted. You know, Nixon said if you want something nasty done, get a healthy right-wing exuberant. You know, so he was one of the healthy right-wing exuberance.

And he was told to make a donation to one of the Democrats campaigns and then send the canceled check to the Manchester Union leader, a right-wing newspaper. It was supposed to be a donation from the Gay Liberation Front but he was nervous that people would think he was gay so he did it in the name of a socialist group instead, right.

And then -- yes, so when the Watergate investigation happened the next year this came out and he was you know, kind of happily ensconced in the Republican National Committee under Bob Dole as a youth organizer. And he was fired and there was a bit of publicity. And you know, lo and behold four years later, here is a running for the president of the Young Republicans which is you know a very important organization on the Republican Party.

Paul Manafort is his campaign manager and basically at the convention Paul Manafort brings this organization that looks more like a national party convention. There is, you know, books full of intelligence on the delegates. They`re trading votes for favors. They`re double crossing people, all sorts of nasty stuff.

And, you know, in my research I found, you know, Walter Cronkite, you know, just kind of pursing his lips in anguish and saying, you know, what has the Republican Party become? He won, right?

And then he becomes, in 1980, because he`s kind of rising up the ladder, he`s organizing basically the whole northeast for Reagan`s nomination campaign, and Reagan wins the nomination and it looks like he`s going to become president and so he gets together with another organizer of the Reagan campaign, Paul Manafort, and a third guy, Charlie Black, who`s still around and seems to have removed himself from any legal taint -- I`d love to know how that happened -- and they decide that they`re going to form a lobbying firm in which they`re going to literally sell their access to the president. And of course they become very famous for basically defining a new kind of bottom feeding lobbying in which they`re willing to work for any dictator.

HAYES: He`s sort of an innovator in that respect.

I want to get your reaction, because the Nixon Foundation today huffily tweeted about the fact that Roger Stone -- he was not -- it was a gross misstatement to say he was a campaign adviser He was 16-years-old during the first campaign, 20- years-old during the reelect, and they`ve -- nowhere in the presidential daily diaries is the name Roger Stone appear. It`s just hilarious to me, like, Nixon from beyond the grave trying to be like I don`t know Roger Stone.

AKERMAN: Right, but again they used people like Roger Stone to do all kinds of little dirty tricks. I mean that business up in New Hampshire, I think that was with Congressman McCloskey (ph), who was running against Nixon in the New Hampshire primary. And so they were trying to make McCloskey (ph) look like he was taking money from a socialist and used Roger Stone to do that.

PERLSTEIN: That was right, yes.

HAYES: And the point, Rick, here is this has been the ply and trade from the beginning is disinformation. He`s got a great quote in the movie.

PERLSTEIN: Right, so he`s still kind of doing this, right. He`s connecting himself to the next generation. I have this crazy story, I ordered a souvenir Roger Stone t-shirt that he basically advertised by sending out to all his contacts. And I paid 30 bucks for this Roger Stone is Innocent t-shirt and I see a charge on my credit card bill. And I don`t recognize it, it`s for a security firm in Miami. I ring the number and say why did I just get charged $30 for a burglar alarm company in Florida? And the guy said, oh, did you order some Proud Boy stuff? And I said no, but I ordered a Roger Stone t-shirt, what does he have to do with the Proud Boys? And to make a long story short, the guy turns out to be the leader of the Proud Boys, a guy named Enrico Terrio (ph), and he claims to me as we chat for about five minutes, because these guys have such strong operational security, that Roger is a member of the Proud Boys and he had lunch with him only that day to strategize.

HAYES: He`s in pictures with them, and they were there outside the crazy scene outside the courthouse and his today in Fort Lauderdale.

Nick Ackerman and Rick Perlstein...

PERLSTEIN: ...a professional thug.

HAYES: Thank you very much. Thank you both.

Within hours of air traffic actually slowing down in one of the nation`s busiest airports, Donald Trump finally surrendered. The longest government shutdown in history is over and Trump`s bluster had been deflated. That`s next.


HAYES: Donald Trump conceded a humiliating defeat today, agreeing to finally end the Trump shutdown without a single concession from Democrats.

The president deals announcing that he would sign a bill to fund the government for three weeks until February 15 without getting a dollar for the border wall that Mexico was supposed to pay for. The Trump shutdown has lasted 35 days, making it by far the longest in U.S. history. As Matt Fuller noted, it took Trump about 35 days, two missed pay periods, 40,000 delayed immigration cases, federal workers resorting to food pantries, and one hour of halted flights at LaGuardia to end the shutdown.

That`s right, Trump did not cave until after his shutdown grounded incoming flights at the New York City Airport where he keeps his private jet. In addition to LaGuardia, there were delays at airports across the eastern seaboard this morning, as well as some cancellations as many of the air traffic controllers who had been working for a month for free declined to show up for work.

It was just the latest disruption caused by Trump`s decision to shut down the government in a fruitless effort to fund his wall, a decision that drove his approval rating to some of the lowest levels of his presidency, and ultimately did not even satisfy his far-right base. After Trump caved today, Ann Coulter tweeting, "good news for George H.W. Bush. As of today, he is no longer the biggest wimp ever to serve as president of the United States."

Trump could have had this exact same deal that he has now on day one with no shutdown. Instead, he inflicted pain and suffering to the country for absolutely nothing.

Joining me now for a reaction and his thoughts on what happens now, Democratic Senator Richard Blumenthal of Connecticut.

Senator, I want to read you a tweet from the White House, "because of the president`s actions, federal workers will be paid in the coming days." Do you agree with that?

SEN. RICHARD BLUMENTHAL, (D) CONNECTICUT: Well, they will be paid, but you said it best right at the beginning, Chris, it`s a bad day for Donald Trump, but a good day for America. The only difference I would have it`s a bad day for individual number one, as he`s known in the Southern District of New York where he was identified as an unindicted co-conspirator. And he was essentially, I think, backed into this corner by the overwhelming evidence that America disagrees with his holding hostage, our country for a vanity project, a campaign applause line, and the country was really going into crisis.

And the apprehension and anger are going to be enduring.

HAYES: OK, so now you`ve got -- the government is going to reopen. The president -- we don`t know when he`s going to sign it, because a lid is called, which means he`ll be signing it in private away from cameras. Three weeks, there`s a conference committed to figure out border funding, is that correct? What happens now?

BLUMENTHAL: There will be a conference committee that hopefully will seek common ground, because there really is a crisis at the border, it`s a humanitarian crisis. It`s a crisis involving children separated from their families, and detention centers that are inhumane, and asylum seekers pushed back into Mexico while their case for fleeing persecution is considered. And we need to seek that common ground to meet that crisis, not just border security.

I`m strongly in favor of border security involving smart and strategic steps like fencing and sensors and surveillance, better technology, more manpower, but also a path to citizenship for the Dreamers and for the 11 million people who are living in the shadows working and paying taxes. We ought to see comprehensive immigration reform through that conference committee, and through the common ground that we have.

HAYES: Whoa, whoa, whoa, wait a second. Wait a second. Are you telling me that the mandate here is to try to craft a Dreamer path to citizenship for Dreamers, some sort of expansion of capacity at the border, border security and comprehensive immigration reform in the conference committee on the DHS approps (ph) bill?

BLUMENTHAL: Not necessarily in that bill.


BLUMENTHAL: We should not over aim...

HAYES: OK, those issues are aside, right? I mean, what`s going to be hammered out is essentially what money for -- how much money for what and then the hope is that we don`t go into another shutdown, correct?

BLUMENTHAL: That is not only the hope, that has to be absolutely the goal. And the conference committee has to arrive at some common ground, but it also ought to be a prelude to broader immigration reform that deals with that humanitarian crisis.

HAYES: I want to also get your reaction, since I have you here today, to the indictment of another one of the president`s close aides and associates. And Nancy Pelosi saying some very strong words just a few moments ago about we need to know what the president -- what the Kremlin has on the president personally or politically. What does today mean from your perspective?

BLUMENTHAL: Today means that for the first time Robert Mueller is pointing to probably the president as colluding with Russia in releasing those stolen documents. Roger Stone is clearly named as the intermediary, the conduit between Russia, WikiLeaks, and the Trump campaign.

And it casts in very dangerous context the president, but also his son Donald Trump Jr. who came before the committee where I serve, the Judiciary Committee, and made some statements that are very, very seriously in doubt as to their truthfulness now after some of what is in this indictment.

HAYES: You think that he -- you think that the president`s son, Don Jr., because of his testimony before the Judiciary Committee, then chaired at the time by Chair Grassley, that he made false statements to that committee?

BLUMETHAL: He has some explaining to do. And I think it`s (inaudible) that very seriously in doubt as to some of the statements that he made about the Trump Tower meeting, his father`s knowledge of it, and about the statements also involving the WikiLeaks release of these documents, and some of them are in this Roger Stone indictment, but he needs to be called back to the Judiciary Committee.

I`ve asked the new chairman, Senator Lindsey Graham of South Carolina, to do so if necessary by subpoena. I think it should be done.

HAYES: All right, Senator Richard Blumenthal, thank you for being with me tonight.

Coming up, between the shutdown cave and the indictment, his long-time confidante, just how politically damaged is the president after today. And next, Neal Katyal, former Obama solicitor general, on what the Stone indictment means for Donald Trump.


HAYES: This week began with a growing number of prominent figures, among them General Michael Hayden and former Solicitor General Neal Katyal, calling for a start to a formal impeachment inquiry into the president. The week ends with yet another close associate of the president being hauled out of his house in the wee hours of the morning in handcuffs.

Here with me now to discuss what this means for the president and rule of law, Neal Katyal, former acting solicitor general and a professor at Georgetown Law School.

What does today mean in terms of your thinking about we are at this moment?

NEAL KATYAL, GEORGETOWN LAW SCHOOL: It`s huge. And today -- by today, Chris, there`s actually two stories we`ve been covering, one is the shutdown solution, which happened at 2:00 p.m., and the other is the indictment of Roger Stone, which happened at 6:00 or 7:00 a.m. And in those seven hours, something pretty dramatic changed. I mean, as you said earlier on the show, Trump could have solved this shutdown any day in the last 34 days with this solution, which is essentially to cave, but he did so today, and at that hour. Why?

The reason is that Trump is increasingly -- being increasingly caught as being surrounded by people who are guilty and who did really bad stuff. So today`s the third stooge. You had Michael Cohen and Paul Manafort before him -- I guess Michael Flynn as well. But then today you had Roger Stone.

And, you know, these people go back decades with the president, and know they the president better than almost anyone Indeed, I`d say they know him better than his wife, although I guess that isn`t saying that much, but, you know, I think there is something pretty dramatic about the fact that these inner circle now of Trump advisers who are now all indicted, many have pled guilty. This is a very, very precarious situation for the president.

HAYES: So, what`s your reaction to people -- there are people who say this in bad faith, but let`s assume the best faith here, good faith. Look, it`s been two years of Mueller. You`ve got -- sure you`ve got all these indictments. Yes, you`re surrounded by crooks of various types, but you`ve got a lot of lying, you`ve got a lot of evidence of shady financial dealings, you don`t have collusion yet. What`s the deal?

KATYAL: I think that actually cuts the other way. And I`d say two things, number one, I`m not sure if any other president, including Nixon, surrounded himself with so many criminals, that`s the first point. And the second is, there`s so much lying going on, and lying about lying, and even when they plead guilty, like Manafort, they still lie.

The question is why. Why is there so much continued lying? And it is always about Russia, it always comes back to that central thing. And so to me the fact that it`s taken two years, which by the way is actually a short amount of time for an independent counsel or special counsel investigation, and we`ve already seen so much, that just means if anything we`re at the tip of the iceberg.

HAYES: You are someone who has been quite vocal of about your concerns about the leadership of the interim attorney general, Matt Whitaker. What does today say to you about the status of the Justice Department, given that, of course, it was the Justice Department that carried out this operation.

KATYAL: There`s nothing he can do that could restore my faith in his integrity to serve at the Justice Department as the acting attorney general. By taking that position, he fundamentally condemned himself to believing in lawlessness and signaling that.

So, I`m glad that he let today actions proceed, that`s a good thing. But, you know, that`s like the broken clock that`s right twice in a given day. That doesn`t to me suggest that we should have any faith in this man, to take an unconstitutional appointment, to do something like this at this moment in time, at this juncture when this country needs an independent attorney general, I think was a profound mistake.

HAYES: How concerned are you about pardons as this circle gets closer and closer to the president and his campaign?

KATYAL: Very concerned. I mean, when you think about it, so the president has been signaling for a long time to Roger Stone, don`t worry effectively just hold tight and I`ll pardon you and I`m sure that`s why he was kind of dancing as he left the courtroom today.

But, you know, which is not the way that any normal person who is indicted acts, but, you know, look, it must be nice, it must be nice, to have Trump on your side. And I think that`s effectively what`s going on here is that Stone knows as long as he holds firm, he`s going to be pardoned.

But here`s the downside about a pardon, if president pardons Stone or anybody else, those people are going to have to testify before congress and before court. They lose their immunity, their fifth amendment protections, which is why they dangle -- the president dangles pardons for so long, but doesn`t actually give them.

HAYES: It`s a great point. Neal Katyal, thank you very much.

In a presidency that has seen many stunning turns, the latest developments seem to have taken this president and the country into brand new territory. The fallout from this head-spinning day next.


HAYES: For most of Trump`s career, his basic MO has been to use braggadocio and shamelessness and a very high tolerance for discomfort to basically just get away with things. And that`s the approach they brought to the shutdown, but today`s humiliating capitulation is an illustration of the shortcomings of that approach that have also characterized his failure- prone career. Bankruptcies and flameouts from casinos and Trump university to Trump Steaks and other ventures.

Today, the president declared political bankruptcy. And it`s going to make whatever he wants to do next that much harder.

I`m joined now by Danielle Moody-Mills, host of Sirius/XM`s WokeAF; Michael Steele, former RNC Chairman and MSNBC political analyst; and Asawin Suebsaeng, White House reporter for The Daily Beast.

Danielle, I`ll start with you. It is amazing to see the way that Nancy Pelosi kept, and Chuck Schumer, too, the way the Democrats stayed together to have this fight to bring about today.

DANIELLE MOODY-MILLS, HOST, WOKEAF: I think that they work together as an incredible team, right, which is what we wanted to see from the Democratic Party and for the fact, all of the people that doubted Nancy Pelosi, that said that she shouldn`t be speaker again, this is the day that the rest of us knew she could handle. And she`s handled it brilliantly.

The way that she took the State of the Union away knowing that taking TV away from a child was going to upset them and have them act the way that they needed to act, and that`s what Donald Trump has shown. 35 days, paychecks missed, no wall, no nothing that he got, but he got his TV taken away and all of a sudden now he`s ready to negotiate.

HAYES: I will also note the labor actions that slowed down eastern seaboard air travel I think was part of the camel`s...

MOODY-MILLS: We know how important TV is to him.

HAYES: Yes, that that is absolutely true. And I think it was really important sort of stick in all this. Asawin, the president tweeting tonight, and it`s really a very funny tweet so I want to read it: "I wish people would read or listen to my words on the border wall. This was in no way a concession, it was taking care of millions of people who are getting badly hurt by the capital S shutdown with the understanding that in 21 days, if no deal is done, it`s off to the races."

Does the White House understand that they got their butt kicked?

ASAWIN SUEBSAENG, THE DAILY BEAST: On a very private and personal level, yes, they do, too. And by evidenced by that tweet, it seems so does the president of the United States himself.

Look, on Wednesday, one of the meetings that President Trump had in the White House that I reported on that included gathering roughly 20 conservative allies and activists in there with him in, I believe it was the Roosevelt Room. The point of doing that was because he wanted to reassure activists and allies in the room that he would not cave. In fact, according to people in the room, he used the word cave repeatedly to say that this was something he would not do.

And he said things like he has the backing of people like Rush Limbaugh, who repeatedly have told him and urged him not to cave on this, and he joked that it was, quote, another day in paradise.

Flash forward two days from that, quote, another day in paradise, and the president did what can only be described even the most generous of terms as a political cave. So this is where we`re at. And this is what the president is going to be watching in terms of cable news coverage and newspaper coverage for the next many days.

HAYES: Oh, yeah. If you`re watching, Mr. President, you lost badly.

Michael, can you imagine how angry Republican Senators are, particularly -- there is this amazing behind the scenes Washington Post piece about the private luncheon yesterday where Ron Johnson is yelling at McConnell, this is your fault. McConnell, "are you suggesting I`m enjoying this?" Snapping back. I mean, what do you think the mindset of that Senate Republican caucus, particularly the people up in 2020 is?

MICHAEL STEELE, FORMER RNC CHAIRMAN: Well, it`s Trump derangement syndrome within the caucus itself where you have those who want to hold the line and support the president versus those who recognize a couple things, one, that they are up for reelections in states that are going to be very difficult for the Senate Republicans to keep. Two, they are hearing from their constituencies. And they themselves have family members who have call them up and said what the hell are you doing.

And so all of that pressure started to centralize around McConnell, which is why he did the move with the vote, letting members go, where members wanted to go, and signaling to the White House, OK, this is as far as we can go here. We can`t go any further.

Going back to the conversation about caving, you know, whenever the president is using that term, any term a lot, generally he`s going to do whatever he is whatever he is saying he`s not going to do. And he knew, the president knew as late as last week that he was running out of runway here, Chris. And it all came to a crashing embarrassing closure for him today on the White House lawn.

HAYES: Do you think -- the latest polling out from Washington Post/ABC was 37 percent. The question, I think is, they thought that if they lose this, it breaks some mystique about him. That`s one way of seeing this, this is a political defeat that sort of permanently damages him in some way.

The other is, the 40 percent of the country that likes the guy will find someway to like him again, which do you think it is?

MOODY-MILLS: I mean, they will find a way to like him again. He is the same person that again said he could stand on Fifth Avenue, shoot, everyone would still love him. These MAGA people, they will love him regardless, he will come up to some spin to this, but the rest of the world we know that he caved. He`s lost -- he had nothing to stand on in the first place. And now, look, he has nothing. He has no wall and he keeps saying he`s going to declare some type of an emergency, but an emergency is usually something that happens in the moment, not something you plan for.

HAYES: Well, and there is the sheer destructive nihilism of the whole thing, Asawin. I mean, here we are 35 days later. they accomplished nothing. Zero things. All they accomplished was to endanger Senate Republicans, tank his approval ratings and put tremendous hardship and stress on hundreds of thousands of American households.

SUEBSAENG: The president deals is really into making deals now his political advisers in and out of the White House have reassured him that, look, once you do this, you don`t have to take it as a cave, you have a series of weeks and at that point, if negotiations don`t go your way, and the Democrats don`t bend at the knee and give you the billions of dollars of wall funding you so desperately want and need, apparently, you have the national emergency option in your back pocket. This doesn`t have to be the end of the road.

And you know what he could still very well do that The probability of that is not anywhere close to zero, but as most fair observers on that issue will concede, the chances it gets tied up in court inextricably are extremely high.

HAYES: Well that -- and Michael, I think Asawin`s point about that is a sort of back pocket, because the one thing you can`t do is run another shutdown. I mean, I just think that you -- they can`t do it. It`s Trump. It`s Trump. And true. And in someways it would be a test of just how abjectly pathetic Mitch McConnell is if you let him do that, because he talks about no education, the second kick of the donkey, this would be the third.

But am I right, that they don`t have any leverage in another shutdown, right?

SUEBSAENG: No, there is no more leverage here. I think the country set the benchmark for its toleration here, and I think that the idea of the next three weeks that we wind up with another shutdown at the end of that three week period is not palatable to anybody.

Again, the Democrats are in the driver`s seat here, because the one thing Trump wants he`s not going to get. Trump`s problem is he`s getting no help from his own guys and getting that one thing he wants.

So, he`s going to have to come around, and they`re going to redefine what a wall is, if you`ve already begun to see for the last two weeks it has gone from this big burly Medieval thing to slats that you can pick up at Home Depot.

HAYES: Nancy Pelosi today pointed to the flowers in her office and said he could plant these on the border and call it a wall, which I thought was pretty funny.

Danielle Moody-Mills, Michael Steele, and Asawin Suebsaeng, thank you for joining us.

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