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Hardball with Chris Matthews, Transcript 7/21/17 White House Shake-up

Guests: Ashley Parker, Leonard Lance, Ellen Nakashima, Azi Paybarah, Catherine Rampell, Carolyn Ryan, Annie Karni

Show: HARDBALL Date: July 21, 2017 Guest: Ashley Parker, Leonard Lance, Ellen Nakashima, Azi Paybarah, Catherine Rampell, Carolyn Ryan, Annie Karni


Let`s play HARDBALL.

Good evening. I`m Steve Kornacki, in for Chris Matthews.

The Spicer show is over. The White House press secretary known for his combative stance with the press was mocked by "Saturday Night Live" and other late night shows. His daily briefings became a form of must-see television these last few months. His performance at the podium was reportedly criticized by the president himself. Spicer`s message was occasionally undermined by a tweet hours later, and rumors of his demise have been swirling for weeks, maybe even months.

Well, the end came today with the hire of a new communications director. His name is Anthony Scaramucci. He`s a long-time Wall Street financier also a Trump loyalist who served on the transition team. Spicer had threatened to quit over the pending appointment of Scaramucci. Chief of staff Reince Priebus also firmly opposed the move. The president, though, chose Scaramucci anyway.

In an interview today, Sean Spicer downplayed any tension in the West Wing. Take a look.


SEAN SPICER, WHITE HOUSE PRESS SECRETARY: He wanted to bring some new folks to help rev up the communications operation. And after reflection, my decision was to recommend to the president that I give Anthony and Sarah a clean slate to start from.


MATTHEWS: Today, the newly named White House press secretary, Sarah Huckabee Sanders, read statements from the president on Spicer and Scaramucci.


SARAH HUCKABEE SANDERS, DEPUTY WHITE HOUSE PRESS SECRETARY: "I`m grateful for Sean`s work on behalf of my administration and the American people. I wish him continued success as he moves on to pursue new opportunities. Just look at his great television ratings."

"Anthony is a person I have great respect for and he will be an important addition to this administration. He`s been a great supporter and will now help implement key aspects of our agenda while leading the communications team. We have accomplished so much, and we`re being given credit for so little. The good news is the people get it, even if the media doesn`t."


MATTHEWS: All right, joining me now, two White House correspondents who`ve spent months in those briefings with Spicer, "The New York Times`s" Glen Thrush and Politico`s Annie Karni. Thanks to both of you for joining us.

Glenn, let`s just start with Spicer himself. With this move -- we saw that clip. He went to Fox News for an interview today. He sounds like he`s going to try to be the good soldier here, a lot of expectations when that news first broke this afternoon, that, Whoa! Wait until he gives the first tell-all interview. Certainly doesn`t sound like that`s coming.

Take us through what you know about what led him to leave today and if you expect that`s going to be the posture he takes going forward, nothing negative to say about Trump.

GLENN THRUSH, "NEW YORK TIMES," MSNBC POLITICAL ANALYST: Look, Spicer has been a flack in this town for going on 15 or 20 years. He`s also had a long career in the Naval Reserve. I`m not expecting him to run around ranting and raving, but we know that his public account is, as we would say, at variance with the factual record.

He was very upset that the president picked Scaramucci, that he was going to layer him over with Scaramucci. And in general, this is not just a battle about Scaramucci and Spicer. It really moves up the chain one level. Reince Priebus, the chief of staff, the former RNC chairman who is Sean`s patron, is in the crosshairs of Jared Kushner and other people in the White House, and this more than anything else represents a diminution of his power.

And Scaramucci, I should say, has a very easy relationship with the president, is much more of a peer, though he`s not really a peer. He`s a rich guy. He`s good-looking. The president listens to what he has to say. And the fact of the matter is, Steve Bannon, the chief strategist, and Reince Priebus do feel threatened by Scaramucci, who now represents an entirely new and distinct power center in the West Wing, as if we needed another one.

KORNACKI: So yes, Annie Karni, let`s follow up on that point then because that`s been a lot of topic of the conversation today. It`s about what does this say about Bannon, about his influence, maybe waning influence? What does it say about Priebus? I know Priebus came out and said he`s behind this move.

But take us inside there and play this out a little bit because a lot of people are looking at this and saying this maybe is just the start. Scaramucci`s influence grows. Those other two fade out.

Is that the -- I don`t know the expectation, but is that the talk right now?

ANNIE KARNI, POLITICO: Well, it`s certainly a new, like, prime player here. Scaramucci is someone who has been talked about as a potential replacement for Reince as chief of staff, so as someone who`s ambitious who would want to move up the ranks there.

Our reporting showed that Reince Priebus and Bannon were both upset with his addition to the team today. Reince is trying to play nice. I think he`s going on a joint interview tonight on Fox to show that, you know, they`re brothers, as Scaramucci called them in the briefing today.

But it`s -- it`s a -- it`s a shake-up also that`s a long time coming. We`ve been talking about Spicer moving out of this role since Trump`s first foreign trip. And Spicer`s been sort of setting the stage that he might leave for months with reporters, saying if he didn`t get control of the entire communications department, if this didn`t go the way he wanted, he might walk.

So his walking isn`t -- is in reaction to Scaramucci himself but was also planned before Scaramucci`s name was totally in the mix for this job. But it`s certainly another prime player who`s as ambitious as the Bannon- Reince-Jared crew that have been he duking it out since January.

MATTHEWS: And I think we`ve got Hallie Jackson, NBC News chief White House correspondent, with us now. Let me make sure. There he is. There`s Hallie in front of...


KORNACKI: ... the White House. Hallie, thanks for taking a few minutes here. Let me ask you this. I think a lot of people today -- they heard the news last night this might happen with Scaramucci. It was confirmed today. Then he shows up in that briefing room today. And I have to say, just looking at the sort of the style of the presentation today, Scaramucci seemed more poised, more polished, more glib certainly than we are accustomed to seeing in these Spicer briefings the last few months.

But if I understand this right, this is not the role that Scaramucci`s going to be playing. Sarah Huckabee Sanders is going to be the one day to day...

JACKSON: Correct.

KORNACKI: ... in front of the press. So what is Scaramucci`s role going to be here?

JACKSON: But don`t be surprised to see Scaramucci do some television, right? That is his strength. That is what the president likes, Steve, even though it`s going to be Sarah Huckabee Sanders doing the briefings. We might see a more visible role for this communications director than you`ve seen in the past for other communications directors.

And I`m going to apologize for being late for your show here. I literally sprinted up the driveway. I was just having a couple of conversations inside the West Wing with senior administration officials.

So let me share with you a little bit of what I`ve learned here. Number one, regarding Anthony Scaramucci`s performance, the one that you`re talking about and referencing here, I am told, perhaps unsurprisingly, from a source close to the president that he thought that Scaramucci did a nice job. He was pleased with the performance. And I think people watching that could have predicted that that would be president`s reaction. Scaramucci played to the cameras. He joked. He was fairly smooth with the reporters, with the assembled media in the room.

And I`ll tell you, sitting in that briefing room, that felt like, you know, week one of this administration, right, you know, the front row all standing up, doing live shots at the same time, networks cutting in for special reports. We haven`t necessarily seen that level of interest in a long time, really since the Comey firing, I think, for a particular briefing. And this one being on camera, number one, this one obviously being with Scaramucci made it a fairly big deal.

Let me walk through a little bit of what I`ve learned about the tick-tock of how today went down. And this is from somebody who`s familiar with how all of this unfolded between Sean Spicer, Anthony Scaramucci and President Trump, that the discussions happened, as you`re talking about, as Glenn and Annie are talking about, yesterday and into the evening, that the president had brought in Anthony Scaramucci, had had a conversation with him.

I`m told by one source it was fairly impromptu. And the president liked some of these ideas. He directed his team to try to figure out a way to get Scaramucci on board. He`s going to come onto the team, that idea that was going. We want to figure out a way to make this work.

At that meeting in the Oval Office this morning, that was the directive to senior staff members. That`s my understanding of this. Scaramucci`s coming on. Make it work. I am told that at that point, Sean Spicer walked back into his office, printed out his resignation letter, brought it back into the Oval Office and had a conversation with the president. I`m told that the chief of staff was present for part of that conversation towards the end of it, when at that point, Sean Spicer offered the resignation letter, then submitted it.

And Steve, I know you have some breaking news. So I`ll toss it back to you.

KORNACKI: Yes, thanks for that, Hallie. I mean, if you thought of being 7:00 o`clock on the East Coast here on a Friday night in the middle of the summer would insulate us from breaking news, we have this now to tell you about, just in the last few minutes, a new report appearing in "The Washington Post." It says that Russia`s ambassador to Washington told his superiors in Moscow that he discussed campaign-related matters, including policy issues important to Moscow, with Jeff Sessions during the 2016 presidential race.

Now, that would be contrary to public assertions by the embattled attorney general. This information "The Washington Post" is getting they are sourcing to current and former U.S. officials.

Let`s bring in Ken Dilanian, intelligence and national security reporter for NBC News, investigated the -- NBC News`s investigative unit. Ken, I am just skimming the story now, I think, along with a lot of other people out there. What can you tell us about what exactly is being reported here?

KEN DILANIAN, NBC INTELLIGENCE AND NATIONAL SECURITY REPORTER (via telephone): Sure, Steve. I`ll bottom line it for you. This is a major development, but there`s an important qualification here.

This story says that the Russian ambassador, Sergey Kislyak, told his superiors that he and Jeff Sessions had this conversation and that that was picked up by American intelligence agencies. It doesn`t prove that the conversation actually happened, and Sessions adamantly denies it.

And this goes back to the April 2016 encounter at the Mayflower Hotel that NBC News and other news organizations have reported on. And we reported a few weeks ago that Congress and the FBI were interested in this meeting. Now, don`t forget there was a Trump campaign event at this hotel. Donald Trump gave a foreign policy speech, and Sergey Kislyak, the Russian ambassador, was there.

And there was a VIP reception. Jeff Sessions was there. Jared Kushner was there. Sessions had said he had no meaningful encounter with Kislyak during this event. And that`s where it stood.

But then we began hearing rumblings that there was some evidence that there was a meeting. There was some kind of encounter between Sessions and Kislyak. And we and others reported that Congress and the FBI were investigating that.

Now "The Post" is saying it`s based on the signals intelligence that Kislyak reported back to his bosses in Moscow that he had a meeting, he had an encounter with Sessions, that they talked about substantive campaign issues, which is important, about Trump positions on Moscow and other things that would be of great importance to the Russian government.

Now, again, Sessions is adamantly denying this, and as "The Post" points out in their story, just because Kislyak reported it back to his superiors doesn`t prove that it happened. And so you know, U.S. officials are still trying to weigh this evidence and -- and determine what exactly happened and whether it`s true.

KORNACKI: And again, let me just make sure this is clear. You`re saying Sessions is adamantly denying it. So Sessions is denying that there is any kind of conversation, or is Sessions acknowledging, Hey, yes, there was some kind of conversation that tangentially involved the campaign? How much is he denying here? Let me just be clear on that.

DILANIAN: Well, you`re asking a very interesting question because initially, his people were adamantly denying that any meaningful encounter took place. But when he was asked under oath, when he testified before Congress about this, he did hedge a little bit. He said, you know, I can`t recall every conversation. I don`t recall meeting Sergey Kislyak, but it might have happened. So under oath, he didn`t explicitly deny any possible conversation.

But -- but I mean, if there was a substantive, meaningful conversation about the Trump campaign of interest to the Russians, that would be a hard thing for anyone seemingly to fail to recall, especially, you know, when he had already gotten in trouble for failing to disclose previous -- or rather subsequent contacts with Sergey Kislyak.

So if turns out that this did happen, that`s going to be a big problem for Jeff Sessions. But right now, there isn`t proof. What there is, is signals intelligence about reporting by Sergey Kislyak back to Moscow.

KORNACKI: All right, Ken Dilanian, NBC News reporter, thank you, Ken, for taking a few minutes and updating us. Appreciate that.

Let`s stay on this story, go back to our panel we`ve got here. Glenn Thrush, let me just go to you. I know we -- we called you on to talk a little bit about the communications shop. Look at this. News happens even on a Friday night in this administration, seems to happen always on a Friday night.

Let me ask you, though, Jeff Sessions here, obviously, his own status in this administration has been called into question by the president`s comments this week. What do you think a story like this could do?

THRUSH: Well, actually, Steve, this intersects with the Sean Spicer/Scaramucci story because how is Scaramucci going to deal with this in any way that`s different than anyone else in the administration? You know, how would Scaramucci, for instance, have dealt with the aftermath of the Comey -- the Comey firing, which Hallie alluded to? These things just keep on happening.

And the president obviously sat down with three members of our staff this week and really dumped all over his attorney general at a moment of great vulnerability for Jeff Sessions.

Jeff Sessions is not exactly in the greatest light in the Senate right now. Republican senators are angry about his failure to disclose things during his confirmation hearings.

So Sessions now is facing a double squeeze. As revelations like this come out, he will continue to get hit by investigators, by Democrats and Republicans on the Hill. And at the same time, the president remains angry at him for recusing himself, which set into motion this whole chain of events that led to the appointment of Robert Mueller.

Sessions is in a very tight situation. And what it really raises the question of is if Sessions isn`t there, who could the president get through the Senate as attorney general? And who would want that job?

KORNACKI: Hallie Jackson, that issue of Russia did come up a little bit today with Anthony Scaramucci there in the White House.


KORNACKI: He said he wanted to defer to the White House counsel on it. But the idea of bringing him in to run the communications operation -- are you picking up, is there any sense here in the White House? Did they have a new strategy? Do they have a strategy -- maybe that`s the better question -- to deal with these Russia questions?

JACKSON: It`s sort of early days for that, right? But let`s get into that a little bit because you`re right, this was brought up today sort of obliquely with Scaramucci, who not only said he wouldn`t get into it, he said, I haven`t really been briefed on it. He hasn`t had these in-depth discussions, he says, with members of the White House staff, particularly the White House counsel.

That said, when you talk about the strategy related to Russia, we have already seen a shift in strategy here, and that is this. Marc Kasowitz, as we reported first thing this morning as this day has now come full circle, is stepping away from leading the charge on the president`s outside counsel team.

I am told by somebody involved in that effort that Kasowitz is still going to be providing guidance to the president, but at this point, now that the operation is kind of up and running, they`re handing off, essentially, tagging out to John Dowd, who`s going to be leading that team now, to Ty Cobb, who will be working on the inside.

Now, Cobb has not started that position yet. We don`t expect that to happen for probably another couple of weeks, at least a little bit down the road. It`s our understanding he`s kind of wrapping up his business before he moves into the White House. And Jay Sekulow is somebody else who is going to be the public face and has been the public face of this response to questions just like this one.

I`ll note that I`ve reached out to the White House for any comments on this "Washington Post" story, and we will update you, of course, if we hear back.

But remember, Sekulow and Scaramucci are buddies. They`re old friends, as Anthony Scaramucci said today. And so I think that this is going to be one of the, if not the top issue that Scaramucci will be trying to figure out. How do you get a handle on the messaging here? Do you hand it all off to Ty Cobb? You`re obviously going to have to have some kind of a communications strategy on this. So far, the strategy has been put a wall the White House and the outside counsel, right, refer all questions over to outside counsel. And I have a feeling we will continue to see that at least somewhat in these coming days.

KORNACKI: And Annie Karni, just looking at Scaramucci today in that briefing room and hearing Hallie`s reporting that the president was pleased with the performance today, the question that hovers over this appointment, like all others, for how long? This is a president who seems to lose patience or interest or confidence in folks he surrounds himself with fairly quickly.

I`m thinking right now of Jeff Sessions. Jeff Sessions went way out on a limb in the campaign last year to endorse him early. Not many members of the Republican establishment certainly in Washington were willing to do that. Now you`ve got the president openly saying, Hey, you know, basically, I wish I hadn`t appointed the guy. I mean, Scaramucci looks like he`s off to a good start now, but realistically, how long does this last?

KARNI: I mean, who`s to say? But people (INAUDIBLE) stick around sometimes longer than we think they will. I actually think that the downgrade of Kasowitz in some ways is much more significant than the shuffling of the press office.

This is Trump actually firing a long-time loyalist, an old New York lawyer who`s worked with him for decades. I think that shows that they know they have a serious legal problem on their hands, that a guy who goes to New York court for you isn`t the guy to go against Mueller`s team.

"The New York Times" and "The Washington Post" reported that they`ve been doing extensive research into people on Mueller`s team. I think this is significant, that they know what they`re up against and he`s -- he`s making a change by actually firing a long-time loyalist, showing that the number one quality he cares about, loyalty, isn`t what he`s going to promote right now, which in terms of having a legal defense team ready to take on this is probably smart.

KORNACKI: All right. Annie Karni, Hallie Jackson, Glenn Thrush, also Ken Dilanian, who joined us by phone there to talk about that breaking new, thanks to all of you for joining us.

Quick break here. Coming up, though, a lot more on this big breaking news tonight, "The Washington Post" reporting again that Jeff Sessions, the attorney general, last year as a senator discussed Trump campaign-related matters with the Russian ambassador. That is according the U.S. intelligence intercepts. That story breaking right now in "The Washington Post" and all around the political world.

This is HARDBALL, where the action is.


KORNACKI: All right, coming up, much more on "The Washington Post`s" big breaking news tonight about Attorney General Jeff Sessions. We`re also getting additional breaking news that Jared Kushner has now disclosed dozens more of his assets in a revised financial filing. It`s a very busy night, all sorts of stories breaking right now. We`re on top of them.

We`ll be back to tell you more right after this.


KORNACKI: All right, welcome back to HARDBALL.

We continue to follow this late-breaking news in the "Washington Post" report that, despite public assertions, Attorney General Jeff Sessions may have discussed campaign-related matters, including policy issues important to Moscow.

"The Post" quotes one U.S. official that Sessions has provided -- quote -- "misleading statements that are contradicted by other evidence."

For more, I`m joined by Ashley Parker, White House reporter for "The Washington Post," and Ari Melber, the new host of "THE BEAT WITH ARI MELBER." That`s going to premiere Monday night 6:00 right here on MSNBC.

Ari, let me start with you.

I feel we should maybe try to back up here, at least for a second. We have got a very explosive headline here. If you can play this thing out, you could play out in a way that is dire for the attorney general and the administration.

But tell us what we do know for sure reading this and some of the questions that are left unresolved.


I think, as your question very carefully points out, this is something that sounds really bad, because it is suggestion, at least according to none anonymous U.S. follow, that Jeff Sessions may have been further misleading about what he discussed with the Russian ambassador. Sounds bad.

The problem here and what is potentially a good defense for the White House is, "The Washington Post" is relying on an intercept of Russia`s version of events. That might be accurate or not.

Do the thought experiment about if Russia, completely on a separate category, was saying something. Would we accept it as 100 true, probably true, or quite possibly not true?

You and I were just speaking right before we went to air. And you said, well, maybe the Russian ambassador is trying to impress his bosses and not being 100 percent accurate.

So while this is something that merits a lot more study, we should be clear that the underlying sourcing is more or less hearsay about a Russian source.

KORNACKI: So, play that out, then.

From a standpoint of any kind of investigation here to figure out what actually happened, if there is no recording of this conversation, of this Sessions conversation with the ambassador, is there any way for any kind of investigator to piece this together?

MELBER: Yes. Yes, there is.

We would expect the special counsel to take something like this, which, again, is hot in the headline, and try to corroborate and investigate it, if they see it as an investigative interest.

We have heard from reports that they`re looking at the meeting with Don Jr. and these Russian officials, these Russian nationals who had previously represented Russian interests.

Well, this obviously is the kind of thing that could also be of interest, because it`s the direct representative of Russia. So, interviews could include people who know about the meeting, contemporaneous records made at the time, or even potentially -- and I`m not saying we`re there yet -- but the special counsel, if they thought it was worth it, would sit down with Jeff Sessions himself, compare that to the transcripts, try to figure out who is really telling the truth.

KORNACKI: And Ashley Parker with "The Washington Post," one of the issues, I think, when a story like the breaks, one of the issues that Sessions has to contend with is that, when it comes to the subject of Russia, conversations with Russians officials, he has been less than forthcoming in the past.


I mean, one of the reasons he had to recuse himself in the first place, which put him in this very tough situation with the president, was because he had failed to mention two meetings with Kislyak, the Russian ambassador.

So, already, his credibility is pretty much shot. And he`s in this weird position where, as you mentioned earlier on your show, a lot of his former colleagues in Congress, senators, are frustrated that he was misleading to them when he testified.

The president is furious with him for recusing himself, which Trump believes basically ended up with the appointment of Mueller as special prosecutor.

And a lot of people at the FBI and Justice Department are also very upset with him because they also blame him for the firing of Comey. So, it is hard to see where his allies are.

KORNACKI: Take us through the politics, though, in the White House right now.

If Donald Trump regrets the pick of Jeff Sessions, doesn`t feel he had his back in all this, Glenn Thrush in the last segment raised an issue that, hey, look, if Sessions resigns, if Trump were to fire Sessions, that would cause quite a storm. Republicans don`t have many votes to spare in the Senate.

We just saw that on the health care dispute. Could there be -- would it be possible to get a new attorney general confirmed, or would this White House ultimately look at that and say, you know what, even if we want to get rid of him, we couldn`t get a replacement right now?

PARKER: Right. It is an incredibly tricky situation.

And so far, every time the president has fired someone in that world, or even threatened to fire someone, it has set off a real firestorm, with actual legal ramifications potentially, and not just shaking up his communications staff.

And, also, it`s a tricky situation because, in general, the president likes a fighter. So, normally, what the president would want would be for Jeff Sessions to fight something like this.

But, as we reported the other day, after the president gave this interview to "The New York Times" on Wednesday where he really just savaged his attorney general in quite public terms, senior White House officials were stunned that Jeff Sessions didn`t resign.

So, the president might potentially be more open to that, or maybe not as inclined to support him right now, when he perhaps needs it the most.

KORNACKI: We should say, the Justice Department has put out a statement tonight.

Sarah Isgur Flores, she is the spokesperson for Jeff Sessions. She says -- quoting here -- "Obviously, I cannot comment on the reliability of what anonymous sources describe in a wholly uncorroborated intelligence intercept that `The Washington Post` has not seen and that has not been provided to me, but the attorney general stands by his testimony from just last month before the Senate Intelligence Committee, when he specifically addressed this and said that he -- quote -- `never met with or had any conversations with any Russians or any foreign officials concerning any type of interference with any campaign or election.`"

And, Ari, just looking at that statement right now, a suggestion here, campaign-related discussions, we should say, that is a very broad umbrella of what could potentially fall under that.


Yes, I think you make an important point. And the argument here is, oh, well, because they touch on the campaign, this is misleading and we have to look into that.

But, ultimately, what you see here is a discussion of basically what are described here as -- in the "Washington Post" article, which I`m obviously looking at -- as campaign issues.

So, take a contrast to the now infamous Don Jr. meeting, where a terrible e-mail from a foreign -- from someone claiming to represent a foreign power, said, I`m offering dirt on Hillary Clinton.

This is not that. This is basically saying, oh, we talked about the prospects for relations between Russia and the Trump administration, if there were to be one.

So, to be clear, that underlying conversation isn`t a bad thing. The question is, as our colleague was just saying, whether it was lied about, if Sessions lied about it. But the underlying idea that you would have this conversation with an ambassador in a formal way isn`t itself alone problematic.

KORNACKI: And I said this was the big piece of breaking news we weren`t expecting today.

There is also more coming in the last few minutes. I think, Ari, you could take us through this, but there`s new financial disclosure information coming out from Jared Kushner, the president`s son-in-law.

What can you tell us about that?

MELBER: Yes, this is very interesting.

The Office of Government Ethics, which recently got attention because Walter Shaub, its director, resigned early, saying he couldn`t really make progress, he felt, under this administration, has this formal role in every administration of going over all the property, all the assets of different individuals.

So Kushner has a legal obligation to work them on a filing which he made. Previously, NBC News, we were able to obtain some of the e-mails about this and found that he really did comply and try to do a good job is what it looked like.

The new thing tonight breaking just now in "The Wall Street Journal," among others reporting it, is that he has missed dozens and dozens of assets. Now, alone, that wouldn`t necessarily be a big deal, because if you`re very wealthy and have complex holdings, as he does, you might miss a few in what lawyers call good faith, that is, not hiding, not on purpose.

The problem here for Jared Kushner, when you look at this story, Steve, is it seems like every time he has to make a legal filing, he is missing not one, not five, but dozens, dozens of things that he has to do and which his lawyers presumably are supposed to help him do right.

So, there`s an emerging pattern with Jared Kushner, who is not there because of his acumen or government service or graduate degrees. He`s there because he`s a family member. Everyone knows that. A lot of attention on nepotism.

And now there`s a pattern of when it comes to contacts with foreign nationals, when it comes to his own assets, when it comes to his own loans, when it comes to his property holdings relating to Goldman Sachs as one of the things here, he seems to keep having to update.

And the question is going to be why.

KORNACKI: OK, news about Jared Kushner, news about Jeff Sessions.

By the way, the big headline today of course was that big shakeup in the communications department of the White House, again, an extremely busy Friday.

Ashley Parker, Ari Melber, thank you both for joining us.

Again, a little plug here. Ari`s new show, "THE BEAT," that is going to premiere this coming Monday, 6:00 Eastern. That`s going to be right before this show. Make sure you tune in for that.

Much more to come this big breaking night of news.

This is HARDBALL, where the action is.

(COMMERCIAL BREAK) KORNACKI: All right, for more on tonight`s news, I`m joined now on the phone by one of the reporters with "The Washington Post" who broke this story about Jeff Sessions and a meeting with the Russians the during 2016 campaign.

Ellen Nakashima joins us now.

Ellen, thank you for taking a few minutes.

So, this public statement we have had so far from Jeff Sessions a few months ago about this issue, he said -- quote -- "I never had meetings with Russian operatives or Russian intermediaries about the Trump campaign."

That`s the on-the-record statement from Sessions. That`s now being -- the accuracy of that is now being at least called into question by the story you`re reporting here.

Tell us exactly what you know. When was this meeting in question, and what do you know about what exactly was said during it?


So, what we know is that Jeff Sessions met with the Russian ambassador, Sergey Kislyak, at least twice -- or three times last year, but at least twice at times in which this Ambassador Kislyak reported back to his superiors in Moscow that he had met with Jeff Sessions, they discussed campaign-related matters, including policy matters, and what Trump`s policy toward Russia, toward Moscow would be in a Trump administration.

And this contradicts public statements and assertions by Jeff Sessions in his confirmation hearing and at his June hearing later and after he -- at a press conference, when he recused himself from the Russia investigation.

KORNACKI: Now, again, we`re getting this essentially -- this is the Russian standpoint that U.S. intel is being exposed to right there. They`re capturing communications among Russians.

And you have got Kislyak telling his bosses back in Moscow this?

NAKASHIMA: That`s right.

These are intercepts of conversations that Kislyak is having with his superiors in Moscow, not of conversations he had with Sessions.

So, it`s always possible that a diplomat will embellish a little or maybe make things up in order to make himself look better in his -- in the eyes of his superior.

But from what we know of Kislyak, he has got a pretty good track record reporting faithfully and accurately on his conversations and activities here.

KORNACKI: All right, Ellen Nakashima, one of the reporters breaking that story again tonight in "The Washington Post," thank you very much for taking a few minutes and filling us in on that. Ellen, appreciate that.

NAKASHIMA: Thank you.

KORNACKI: For the Republican reaction to tonight`s news, joined now by MSNBC host Hugh Hewitt and New Jersey Republican Congressman Leonard Lance.

Hugh, let me just ask you your reaction. You heard the conversation I just had with Ellen Nakashima.

What do you make about this story about Jeff Sessions and what he`s been saying before publicly about his conversations with the Russians?

HUGH HEWITT, MSNBC POLITICAL ANALYST: Well, Steve, if it`s true, I think the attorney general will have to resign.

But if it`s true is a big if. I remind the audience of the February 14 "New York Times" story that counted all the different contacts alleged to have occurred between Trump campaign officials and the Russians, which former FBI Director Comey under oath testified was in the main not true.

But if there were a series of conversations between the ambassador and the attorney general, and they are recorded in a Foreign Intelligence Surveillance Act, lawfully intercepted tape, that is the end for Attorney General Sessions.

And I think you have to look out to Chicago to Boeing general counsel Mike Luttig`s to see him talking on the phone probably with the president about coming in to try and right the ship at Justice.

KORNACKI: Congressman Lance, let me ask you. The president made clear this week he may not have full confidence in his attorney general.

As a Republican, as a member of Congress, do you have confidence in this attorney general?

REP. LEONARD LANCE (R), NEW JERSEY: Yes, I was the first Republican on the Hill to suggest that the attorney general should recuse himself in matters related to Russia. And I`m sure this will be investigated.

It is not unheard of, however, for an ambassador to embellish, as the reporter who has broken the story has indicated. So let the chips fall where they may based upon the facts.

KORNACKI: Do you see, though, between -- so, his statement at his confirmation hearing, again, back in March, Sessions`s statement was, "I never had meetings with Russian operatives or Russian intermediaries about the Trump campaign."

I guess, do you see any room where he could have -- the subject could have come up in any way in the conversation where he would retain your confidence, or if this -- because, again, we`re getting sort of a vague report here.

But if there was any kind of conversation here about the Trump campaign, hey, what do you think of their position on this, what do you think their chances in this state, does that cross the line?

LANCE: I think that would be very problematic for the attorney general.

And perhaps at the reception after one of the events, if the Russian ambassador had come up to him and said, how is the Trump campaign going? And if he had said, it is going really well, I don`t think that would be substantive. But let the chips fall where they may.

KORNACKI: All right.

And, Hugh Hewitt, you`re already talking there about at least a potential scenario -- who knows what is going to happen here, but the potential scenario of a new attorney general.

It is interesting the timing on this, because, earlier this week, Donald Trump made clear he had some regrets about appointing Jeff Sessions.

I do wonder. We raised the question earlier with Glenn Thrush, just given the tenuous hold Republicans have on the Senate right now, not many votes to spare, certainly the -- how unlikely, I guess, it would be for the Democrats to get behind a new Trump pick for attorney general, would this be a circumstance where maybe Trump could get a new attorney general confirmed?

HEWITT: Well, I absolutely think, if you nominate the right person.

You could go to the bench to Attorney General -- former Attorney General Mukasey. I mentioned former federal Judge Michael Luttig, who is the runner-up to be the chief justice of the United States, longtime fourth circuit judge. Very successful general counsel of Boeing, tough as nails. If it were Michael Luttig, I think he would get the 52 Republican votes. I don`t know if any Democrat would come along.

I want to go back to the problem of the recusal that the congressman brought up. These recusals have penumbras, Steve. They go further than they`re intended to go. Now I think the attorney general will be recused from surveillance matters with regard to the Russians.

And so, the oil slick spread of the recusal becomes a problem that might invite a reset at the Department of Justice so that he should not fire Mr. Mueller. The president should leave Mr. Mueller alone. He enjoys a great reputation for integrity.

But it would be good to have an attorney general who could supervise everything else in the department without concern of the spreading recusal.

STEVE KORNACKI, MSNBC HOST: Let me just, Congressman, follow up on what Hugh Hewitt said. He said the president should not fire Robert Mueller, the special counsel. Do you agree with that?

REP. LEONARD LANCE (R), NEW JERSEY: I absolutely agree with that. And, Michael McCaul, a colleague of mine and chairman of the Homeland Security Committee indicated that as well today.

KORNACKI: What would the consequence be? And, politically, in terms of the Congress of the United States, what would the consequence be if the president did that?

LANCE: It would be disturbing on Capitol Hill, not only with Democrats but with Republicans as well.

KORNACKI: All right. Congressman Leonard Lance, Republican from New Jersey, Hugh Hewitt, MSNBC host, you can catch his show tomorrow morning right here on this network.

Hugh, thanks for joining us.

HEWITT: Thanks, Steve.

KORNACKI: A quick break here. Up next, though, the HARDBALL roundtable is going to be here on what has turned out to be a very busy news night. We`re still piecing together the breaking news.

You`re watching HARDBALL.


KORNACKI: Welcome back to HARDBALL.

Well, my ears perked up in the last block with something one of our guests said. Maybe you heard it too. Hugh Hewitt was here in the last block, and he said if the "Washington Post" report is true about Attorney General Jeff Sessions and about his conversations with the Russian ambassador during last year`s campaign, if that report is true, Hugh Hewitt said Sessions should resign.

Let`s bring in tonight`s HARDBALL roundtable. Carolyn Ryan is a senior editor at "The New York Times", Catherine Rampell is a columnist for "The Washington Post", Azi Paybarah is a senior reporter for "Politico".

Catherine, the timing on this, I can`t get over, because the story one -- of the stories of the week has been the president in a rather unprecedented move coming out there and basically saying, hey, I regret appointing Jeff Sessions attorney general. If he wants to get rid of him, the story that`s come out, at least we have to see if this is true, if it`s true at all, he`s got grounds to do that.

CATHERINE RAMPELL, COLUMNIST, THE WASHINGTON POST: I mean, to be clear, cabinet members serve at the pleasure of the president. He could get rid of him without any -- without giving a reason, right? So, he doesn`t actually need to establish why he would ditch this guy.

The question is, what`s the context? How much of a blowback is he going to get form his fellow Republicans if in fact he does fire Sessions, and how difficult would it be to find a replacement and to get a confirmation of a replacement?

KORNACKI: That seems to be the issue. It`s the pretense. If you`re Trump and you want to fire him and you`ve got 52 Republican votes in the Senate, we just saw they couldn`t get their health care bill through because if you have three defections you`re done. So, if you just fire Sessions for no reason and you say, I`m the president, I can do it, I see probably pretty easy to get three Republicans to say no to a replacement. But if you`ve got grounds to do it from a story like this, if this turns out to be true, then the urgency of getting replacement through would be a lot easier to get those 52 Republicans on board.

CAROLYN RYAN, SENIOR EDITOR, THE NEW YORK TIMES: It would be a lot easier and I think -- don`t forget, the Senate Republicans, Republicans in general are feeling frustrated with some of the earlier omissions by Sessions. And another thing that was striking to me about the story is there was not strong pushback from the Sessions side. I mean, obviously, we have to see whether that changes in the first 24 hours.

But again, there`s an omission or an absence of a strong rational or response. It seemed like "The Post" story was pretty solid and it seems like Kislyak has been trusted before with these kinds of accounts. We have to see.

KORNACKI: Yes. I mean, Azi, there are we should say. Look, this is one report. This is based on intercepts. This is anonymous sources. This is the Russian side of it.

So, there are all sorts of asterisks here and also there is that issue of, OK, they talked about campaign related matters. That also was a very big umbrella in terms of what that could potentially be.

AZI PAYBARAH, SENIOR REPORTER, POLITICO: Right. And there is -- if this was just a passing remark that Kislyak is sort of overplaying for his handlers to sort of show his bosses that he is doing something, that`s one thing. But what Carolyn said is actually very important. Republicans are frustrated on the House, on the Congress. Trump himself is very frustrated. It came out during his interview with "The New York Times."

And to have another story coming out, and to keep this conversation, to keep Russia in the front grounds of what people are talking about when they`re trying to get health care through, even if it doesn`t turn out to be as it is first reported, because Kislyak isn`t reliable, you do have grounds for Jeff Sessions to say, this has become enough of a distraction to take himself out if that`s what is wanted. Remember, Republicans are trying to get health care through. It is very narrow and this is keeping the Russia story alive even longer.

KORNACKI: This is, by the way, a very good introduction I think for the job for Anthony Scaramucci, because he was the story and his takeover of the communications department was the story. Seven-forty on the East Coast, nobody is talking about that right now. Breaking news has overtaken it.

Quick break. The roundtable is staying with us. This is HARDBALL, where the action is.


KORNACKI: Welcome back to HARDBALL.

Late today, we learned that Donald Trump Jr. and Paul Manafort will not be appearing before the Senate Judiciary Committee next Wednesday. According to the committee, quote, both Donald Trump Jr. and Paul Manafort, through their attorneys, have agreed to negotiate to provide the committee with documents and be interviewed by committee members and staff prior to a public hearing. Therefore, we will not issue subpoenas for them tonight requiring their presence at Wednesday`s hearing but reserve the right to do so in the future.

We have also learned that President Trump`s son-in-law Jared Kushner is set to occur before the House Intelligence Committee on Tuesday. That after his Monday interview with the Senate Intelligence Committee.

We`re back now with tonight`s HARDBALL roundtable -- Carolyn Ryan, Catherine Rampell, Azi Paybarah.

Carolyn, what do you make of this? So, we`re not going to have the big public spectacle of Manafort and Trump Jr. before the committee. They are going to be providing information. They are going to be interviewed, but this is now going to be a private affair on Wednesday

RYAN: It feels like loss for the television networks. It was really the highest anticipated event, testimony-wise, since Comey. But there`s a possibility that interviews with the staff and with the committee members could yield more in terms of some of the intricacies, especially with Manafort. It feels like there`s a lot to be explored in terms of his interests, in terms of his ties. Some of which we`ve reported recently to Ukraine, to pro-Russian interests. And it feels like the substance there is something that the committee really could be eager to get at.

KORNACKI: And is there a connection here, Catherine? Because he`s got this other guys, Glenn Simpson, who is behind that Trump dossier that got so much attention. He is declining to appear before the committee. Is there a link here in terms of Trump Jr., Manafort to say, well, if he`s not going to appear publicly, I don`t want to appear publicly?

RAMPELL: Well, they are subpoenaing him, right? Isn`t that what we learned earlier today? So, they are subpoenaing Simpson. So, the door is still open for a subpoena to occur for the other folks that we`re talking about.

I think the question is to what extent does that successfully detract attention from the potential scandal that is hovering around Manafort, Trump Jr. and Kushner, right? Because potentially part of strategy here in going after Simpson. Grassley has said, how come he hasn`t registered as a foreign agent. His firm was in charge of putting this dossier, right, is to maybe make it look like both sides were doing something bad. And we shouldn`t always be focusing our attention stuff that the Trump campaign --

KORNACKI: And, Azi, just quickly, Kushner now becomes a bigger story next week.

PAYBARAH: Right, he has a very large portfolio. He had to amend his financial statements. So, for him to come in and explain why he was in these meetings, what he expected, that`s going to yield a lot of information.

KORNACKI: OK, the roundtable is staying with us. You`re watching HARDBALL.


KORNACKI: All right. We`re back with the HARDBALL roundtable.

Look, I don`t want to put anybody on the spot but this story about Jeff Sessions has everybody talking now. Let`s try to play this a little bit forward.

Carolyn, as this develops, what are you looking for?

RYAN: Well, what I`m looking for over the next 48 hours is whether there`s going to be any pushback from the Sessions side, any more detail, because I think if there is not, you`re going to hear more calls like you just heard from Hugh Hewitt, and I think that will take you right into the beginning of next week, which is already a high stakes week, and probably pretty uncomfortable one for the administration. So, this could really become intense, the pressure on Sessions. If all of these remain solid, could be very intense.

KORNACKI: What about you, Catherine?

RAMPELL: I`m looking to see how this plays with the Trump base, and that they have been convinced, it seems so far, that any of these Russia stories are all conspiracy theories, it`s all #fakenews. If in fact this is being used as an excuse to oust sessions, will the base buy it if they think it`s all conspiracy and it`s fake anyway?

KORNACKI: Azi, in 10 seconds.

PAYBARAH: If Sessions holds on, do Schumer and Democrats point to him as a reason Republicans shouldn`t throw their lot in with Trump. He`s not loyal to the people that were loyal to him, look at Sessions.

KORNACKI: OK, Azi Paybarah, Catherine Rampell, Carolyn Ryan, thank you for joining us.

That is HARDBALL for now. Chris Matthews is going to return Monday night.

And "ALL IN WITH CHRIS HAYES" starts right now.