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Hardball with Chris Matthews, Transcript 9/14/17 Sputnik and new theory of war

Guests: John Brabender, Adolfo Franco, Michael Schmidt, Jim Rutenberg, Terry McAuliffe

Show: HARDBALL Date: September 14, 2017 Guest: John Brabender, Adolfo Franco, Michael Schmidt, Jim Rutenberg, Terry McAuliffe

CHRIS MATTHEWS, HOST: Trump dates Democrats.

Let`s play HARDBALL.

Good evening. I`m Chris Matthews in Washington.

About 24 hours ago, Donald Trump was sitting down to dinner with House Democratic leader Nancy Pelosi and Senate Democratic leader Chuck Schumer. Chuck and Nancy, as the president calls them, joined the president and a few members of his cabinet to discuss trade, China and protections for what some call "Dreamers," those covered by DACA.

What happened in the ensuing hours has left Republicans and Trump base off- guard. Around 9:30 PM, the White House put out a statement that the president had a constructive working dinner with the Senate and House minority leaders to discuss policy and legislative priorities.

Fifteen minutes later, Pelosi and Schumer`s offices put out a statement of their own, that the president agreed to, quote, "enshrine the protections of DACA into law" with a package of border security, including the wall -- excluding the wall, rather, that`s acceptable to both sides.

Well, shortly thereafter, according to Politico, the White House legislative office was in damage control, saying the president only agreed to work on fixing DACA soon, conceding he wouldn`t insist that wall funding be part of this particular deal.

Well, early this morning, hours after the initial dinner, the president was doing his own corrective tweeting. No deal was made last night on DACA. Massive border security -- massive border security -- would have to be agreed to in exchange for consent, would be subject to vote. But he added, Does anybody really want to throw out good, educated and accomplished young people who have jobs, some serving in the military? Really?

Congressional Republicans were blindsided.


UNIDENTIFIED MALE: Well from what I`ve heard, it sounds like a deal to make a deal.

UNIDENTIFIED MALE: If the president did make a deal, we`ve still got to do what we do on Capitol Hill.

UNIDENTIFIED MALE: It was a big theme of his campaign, and I think him changing course on this is at his own peril. But you know, his base will be very, very unhappy with this.


MATTHEWS: "At his own peril." What`s clear is that the past 24 hours have left members of the president`s party, the Republicans, feeling bypassed, even pushed aside.

For the latest on how these negotiations are being received, I`m joined by Yamiche Alcindor of "The New York Times" and an MSNBC contributor.

So Yamiche, give me a sense of what the aftershocks are up there on the Hill.

YAMICHE ALCINDOR, "NEW YORK TIMES": Well, the common ground that the president was able to reach with both Democrat -- with Democrats has really left Republicans on the Hill both confused and on the defensive.

I`ve been talking to people, and in interview after interview, those Republicans are saying that they don`t understand how the president would go out to the White House and have dinner and over chocolate cream pie basically say that he was going to give up what was a large messaging tool during his campaign.

Dave Brat of Virginia, who is part of the House Freedom Caucus, which is, of course, that very conservative group in the House -- he said that he thinks that the wall absolutely is something that needs to be an important part of border security, and he says that the whole election was essentially about the wall.

MATTHEWS: Well, I don`t think he`s on base with reality. Anyway, let me ask you about the one thing I always ask about. And it breaks the heart of the people that deal in generalities. Will they get enough votes to get through the House? Will they get a vote in the House on this proposal to basically codify -- "enshrine" is the word -- DACA?

ALCINDOR: I think that they will absolutely be able to get the votes if the president sticks to his negotiating tactics and decides that he wants to allow the Democrats a large role in figuring out what this legislation actually has inside of it.

Now, people I`ve talked to say that McConnell says that he`s in some ways open to that idea that the president is going to play point on this. But the president doesn`t have a lot of experience when it comes to crafting actual policies. So essentially, what comes to the House floor is going to be a bill that was written by Democrats.

MATTHEWS: Well, Yamiche Alcindor, for that update. It looks promising.

For more on what the president was thinking, I`m joined by Adolfo Franco and John Brabender. Both are Republican strategists. Gentlemen, you know, I think from Trump`s point of view, John and Adolfo -- I think from his point of view, I want this baby off of my back. I want these people to be allowed to stay here, whether I have to do it by EO, I`ll do it that way, but I don`t want to be the bad guy sending home these kids -- people who were brought here as kids.

Same thing Democrats have their constituency, it`s Hispanic, people from that part of the country and that part of the world from Mexico and other Latin countries mostly. They want to help these people. They have a particular interest in helping them, more than the Republicans.

The only outsiders here are the right-wing Republicans, who have some notion of a wall, which I never thought was real. But what do you think?

JOHN BRABENDER, REPUBLICAN STRATEGIST: Well, first of all, all the president did was decouple the whole idea that the wall had to be specific to this piece of legislation. Second of all, he said no amnesty. He said there`s no citizenship. And there has to be significant security added to this at the borders, not some guy with a flashlight, like the Democrats like to do.

Here`s the thing, though. The Democrats are running a bit of a scam here. The way that Pelosi and Schumer did this, they ran out there to try to put their spin on it, not what the president said, because they knew what the reaction would be.

MATTHEWS: How do you know what the president said to them?

BRABENDER: Well, I know it as well as anybody else.

MATTHEWS: Well, they were there!

BRABENDER: But the point is, why would -- what would be their incentive to run out with these statements...

MATTHEWS: Because they won!

BRABENDER: No. They`re trying to derail it. They do not want...

MATTHEWS: Oh, you`re a conspiratalist (ph) now!

BRABENDER: They do not...

MATTHEWS: They won the argument. They want to look out for these people they call Dreamers...

BRABENDER: They were so happy with what happened...


BRABENDER: ... that they were out there...

MATTHEWS: How many wins have the Democrats had lately?

BRABENDER: No. They were out there trying to imply it was something that it wasn`t and to see what the response would be.

MATTHEWS: OK. Well, I`m not Pollyanna, you know, Adolfo, but I believe it`s a win-win for Trump and the Democrats. It`s a win-win. They both want to help these people for totally different reasons, but they want to help them.

ADOLFO FRANCO, FORMER MCCAIN ADVISER: Well, I completely agree with that. What I am surprised about -- and I actually do agree with John, but what I am...

MATTHEWS: Agree with him what, that this was some clever spin to disrupt the thing?

UNIDENTIFIED MALE: In this way. There was a clarifying statement today by Pelosi`s office that said, yes, there was no -- there was no final deal. They had agreed in principle. But let me just back up for a minute...

MATTHEWS: That`s pretty good, agree in principle.

UNIDENTIFIED MALE: Well, but it is in principle. Two things to keep in mind. First of all, the president is now being criticized for bipartisanship or efforts to make a bipartisan deal, what people have been calling for for many months. But most importantly is, you`re going to step back, Chris -- when DACA -- when the announcement was made, it was consistent with his message. It`s unconstitutional. It`s consistent with the last few months where he said he had...

MATTHEWS: You can`t do it by EO.

UNIDENTIFIED MALE: Exactly. And -- and then he said six months! That, I think, demonstrates, frankly, his compassion and willing to work with Congress.

MATTHEWS: What are we arguing about here? What`s going to happen -- don`t you all agree that if the Congress doesn`t act, the president will act? He doesn`t want this on his back.

BRABENDER: Well, this is where the big story, in my opinion is, is not whether they agreed or disagreed. It`s that this president has decided he can no longer negotiate through the Republican leadership and he is going to become the negotiator at this point on many things.

MATTHEWS: OK, let`s ask (INAUDIBLE) Republicans watching would like to know, I think. Why didn`t he go to Mitch and Ryan, the speaker first, have the dinner with them about this and then say, Hey guys, you may not like this, but tomorrow, I`m having dinner with Nancy and Chuck. We`re going to work this thing out. Why didn`t he start with the Republicans? Why did he start with the Democrats?

BRABENDER: In my opinion, the lack of repeal of "Obama care" changed the rules at the White House on everything. I think he feels that he can be a better negotiator, get what he wants, and then get the Republicans on board...

MATTHEWS: Is he goosing them? Is he pushing them along, saying, Look, I got the Democrats, now you guys got to act?


FRANCO: I don`t think he`s goosing them. I think what he has done -- and I think -- I believe this to be the case -- is I think he is looking beyond DACA and coupling DACA. He`s not coupling with the wall. But he is going to refer to massive increases...

MATTHEWS: Right. Well, that`s what he said today.

FRANCO: ... in border security. And I think this is going to be an opening to get something that would have been inconceivable even a week or two ago.

MATTHEWS: Well, I...

FRANCO: You see the opposition from Congresswoman Sanchez and now from the Democrats. There`s disarray on the Democratic side now!

MATTHEWS: What are they complaining about?

FRANCO: They`re complaining about the fact is -- they don`t want -- they want a clean DACA. They want to enshrine this cleanly. They`re now upset with the Democratic leadership for saying now...


MATTHEWS: OK. Well, there`s always going to be people at both ends.

Look, President Trump`s supporters exploded at the news that the president is pursuing a deal with Democratic leaders. Immigration hardliner -- here he goes again -- U.S. Congressman Steve King tweeted, "President Trump -- if the Associated Press is correct, Trump base has blown up, destroyed, irreparable and disillusioned beyond repair. No promise is credible."

Ann Coulter -- here we go again, who wrote a book about why she supported Trump -- responded to the president`s defense of Dreamers by tweeting, "At this point, who doesn`t want Trump impeached?"

The president pushed back, telling reporters that he`s not looking for amnesty, as you said. Here he is.


TRUMP: We`re not looking at citizenship. We`re not looking at amnesty. We`re looking at allowing people to stay here. We`re working with everybody -- Republican, we`re working with Democrats.


MATTHEWS: Well, it looks to me like this is part of -- it`s sort of like the symptomatic problem. We have a lot of young people in the country, 800,000 or whatever it was, who were brought here mostly by their parents. They didn`t have a big thought about it or idea about it. They`ve considered themselves in most cases, I believe fair to say, Americans. They just aren`t here legally, and they want to give these guys a break.

And I`m not sure it is -- I think Trump isn`t going all the way with amnesty, if you will. He`s not giving them citizenship or even a route to citizenship. He`s just saying the government will be off your back, just like Obama said.

FRANCO: Well, he said, We`re going to take care of people. That`s what he said. Those were the president`s words. The are -- this -- this -- what you should show up here is the polling for Republicans and Trump supporters. Two thirds of Trump supporters favor DACA.


FRANCO: And the vast majority of Republicans favor DACA.


MATTHEWS: This is win-win!


MATTHEWS: This is win-win!

FRANCO: But you mentioned left and -- you said extreme left and the extreme right in Congress...


FRANCO: ... have different views.


FRANCO: But the vast majority of Republicans...

MATTHEWS: I`m with you. You`re arguing with nobody. I`m sitting here and I`m not arguing with you!

FRANCO: But what he`s done, I think, intelligently on this is he`s moved the Democratic Party to a position where I don`t think they were very recently, and that...

MATTHEWS: How so, because they`re for stronger border protection?

FRANCO: Well, for stronger border protection -- we have yet to see the details when he refers to a great deal of more border protection...


FRANCO: ... and maybe a different way to do border protection.

MATTHEWS: OK. Let me -- let me -- look, I`m a -- like, one of these people in the Middle East. I want a final solution. I want to end this debate in our lifetime.

Why can`t he go back, now that we`re all in the mood for getting together and kumbaya -- why doesn`t one of these sides say, OK, we`re in the mood to get some deals made? Why don`t we go back to the deal with had with the thing that passed the Senate with a whole bunch of Republicans behind it, 12 or 15 Republicans behind it, that basically said, We`re going to let people have a path to citizenship. They get in line behind everybody else, but also, there`s no more illegal hiring. It`s all part of the deal.

And Republicans (INAUDIBLE) from Kennedy, Jack -- Teddy Kennedy was for this. Chuck Schumer was for this. A lot of Republicans like Lindsey Graham were for it. McCain was for it.

Why can`t they go back to a final deal and end this...


MATTHEWS: Please guys, why can`t we end this debate? The people that are here are going to stay here. Stop the flow of illegal immigrants in the future. End this debate. Why can`t we do it?

BRABENDER: If you understand the 2016 election, I`ll tell you why we won`t do it. Always the context is, What about these people here illegally? What are we going to do about them? Oh, let`s take care of them. And that`s just going to encourage a lot more people.

MATTHEWS: Not if you can`t hire people illegally.

BRABENDER: What Republicans are doing are contextually first saying, Why don`t we look at the working Americans here that are impacted and make sure whatever we do isn`t going to negatively impact them, as well.

MATTHEWS: What do you think? Why don`t we have a deal?

FRANCO: For this reason...

MATTHEWS: In other words, the government is hopelessly...


MATTHEWS: ... hopeless to deal with immigration.

FRANCO: Well, we can deal with immigration, but we have to do it in sequence. What are we doing about the border? What are we doing about...

MATTHEWS: You`ll never win that with Democrats. Democrats will never agree...


FRANCO: We had a deal in 1986 with President Reagan.

MATTHEWS: Why don`t you want a total deal?

FRANCO: Because a total deal has to first attend to the problems that we have currently, which is still immigration coming in illegally. My question is, if we take care of DACA today, will we have a DACA situation in five years with new...

MATTHEWS: Let me explain the sequence. You want to get into the sequence.


MATTHEWS: You can`t outlaw illegal hiring now because there are so many people here who are not here legally because they would never be able to work tomorrow morning! You have to do it sequentially. You have to say, OK, from now on, starting this date, anybody comes in the country past this day can`t work here illegally. We`re going to enforce the e-verify system. We`re going to enforce it!

FRANCO: People do it all the time. There`s an underground economy. There`s a cash economy. There`s all kinds of overstay situations. We have e-verify...

MATTHEWS: It`s against the law, enforce the law.

FRANCO: Well, I am for enforcing the law. It`s the Democrats that have called for suspension of the enforcement of the law.

MATTHEWS: OK. Anyway, this afternoon, Rush Limbaugh, who always likes to solve the problems like this, when talking about DACA negotiations, reminded the president why he was elected. And here`s what Rushbo said.


RUSH LIMBAUGH, RADIO TALK SHOW HOST: Boil everything down. Trump -- is Trump -- I`m asking you who voted for him. Is he this tone deaf? Is he this ignorant? Does he not know what got him elected? Does he -- I mean - - and I`m telling you, some of the staunchest Trump supporters are out there, and they`ve jumped ship.


MATTHEWS: Is this going to help Lou Barletta run for the Senate...


MATTHEWS: ... about Bob Casey? Does this help a Republican...

BRABENDER: Whether it`s Rush or Steve King, they`re all responding to what they thought based on what the Democrats said. So you had Pelosi and Schumer high-fiving every time you saw this. The truth of the matter is, though, Rush Limbaugh is right. Who elected him were a lot of Democrats in Rust Belt states, were tired about the Democrats not doing anything about real immigration reform or protecting these borders.

MATTHEWS: Let me ask you both, Adolfo first. Do you think President Trump truly wants to help out these people who came here because their parents brought them here?

FRANCO: I`m convinced of it and...

MATTHEWS: OK, next. Do you believe the Democrats, Pelosi and Chuck Schumer, really want to help these people whose parents brought them here?


BRABENDER: I believe that their goal, and I truly believe this, is to do everything they can to hurt Donald Trump because...

MATTHEWS: OK, they`re not here to help those people.


MATTHEWS: So they`re not there to help those people.

FRANCO: I think they`re playing political with this. I really do.


FRANCO: I don`t think President Trump is.

MATTHEWS: You`re hopeless. Anyway, thank you, Adolfo Franco. You`re a good guy (INAUDIBLE) At least you have a heart and some kind of belief system. You think everything is political.

BRABENDER: No, I think those two are.

MATTHEWS: They are usually, but this time, I think it`s right. Anyway, John Brabender, thank you.

Coming up, new reporting out this evening that President Trump demanded -- you won`t believe this -- that Attorney General Jeff Sessions who was with him from the beginning -- he demanded that he resign after Trump learned that Special Counsel Mueller had been appointed to lead the Russia investigation. Trump blamed the appointment on Sessions`s decision to recuse himself and reportedly called Sessions to his face in the Oval Office -- to his face, the attorney general of the United States -- an idiot.

Plus, in the wake of Charlottesville, Congress has passed a resolution condemning neo-Nazis and the KKK. Trump says he`ll sign it, but once again today, he couldn`t resist a shot at those he called the "bad dudes" confronting the neo-Nazis and KKKers. We`re going to talk to Virginia governor Terry McAuliffe about that baby.

And before President Trump took office, Jared Kushner committed $1.8 billion he didn`t have to develop a prominent Manhattan skyscraper with the address of -- this was trouble -- 666. And according to the new report, investors are now fleeing from the project. They don`t want the scrutiny and conflict that comes with working with the Trumps.

Finally, let me finish tonight with "Trump Watch." He won`t like it.

This is HARDBALL, where the action is.


MATTHEWS: South Korea`s ministry of defense has confirmed the North Korea launched an unidentified missile from the outskirts of Pyongyang tonight. According to a Japanese government official, it flew over a northern Japanese island and later landed in the Pacific.

The launch occurred at the same time the South Korean air force was conducting a live fire exercise. And it comes after North Korea tested a new nuclear device earlier this month. The White House says the president`s been briefed on the launch.


MATTHEWS: Welcome back to HARDBALL. "The New York Times" is reporting new details about how President Trump confronted his attorney general, Jeff Sessions, after learning that a special counsel had been appointed to lead the Russian investigation. Blaming the appointment on Sessions`s decision to recuse himself, Trump told Mr. Sessions that choosing him to be attorney general was one of the worst decisions he had made.

He called him an idiot right there in the Oval Office and said that he should resign -- to his face. Sessions told associates it was the most humiliating experience in decades of public life. I expect it was. Ultimately, his resignation was not accepted, however, by the impulsive president.

Meanwhile, Politico reports late tonight that Paul Manafort`s spokesman is expected to testify before a Washington grand jury tomorrow. That should be interesting.

I`m joined right now by one of the authors of "The New York Times" report on Sessions, Michael Schmidt. Thank you, Michael.

This is just emerging now, but you guys have had your bases covered. What do you have, seven sources for this baby, seven sources that were in the Oval Office and said the president called his attorney general that he appointed, that was with him from the beginning, is an idiot?


What we tried to do is look back on the day that Mueller was appointed to try and understand, you know, what was Trump`s reaction to it, where was he and what happened.

And he`s sitting there in the Oval Office with Sessions. He finds out about it, and he immediately turns on Sessions. He believes that Sessions` decision to recuse himself from the investigation, which he had done in March, was the sort of ultimate sin here, and that had allowed for the Justice Department to appoint a special counsel, which Trump at that point was very deeply concerned about.

MATTHEWS: What stopped him from following on his impulse, and keeping Sessions?

SCHMIDT: I think that several senior White House officials, including Vice President Pence, realized that the impact of getting rid of the attorney general would be probably disastrous for the White House.

At this point, he had already gotten rid of the FBI director, already gotten rid of the acting attorney general, already gotten rid of his national security adviser. Trump has shown that he can survive a lot of things. And my guess is, he probably would get through it.

But there was no clear indication of -- that they could actually get a new attorney general through Congress. Congress probably would have turned that process into a big-time sort of thing about the administration on Russia.

MATTHEWS: Boy, it does tell me and I guess all of us how much he feared this special prosecutor, especially with the resume running behind Mr. Mueller. This guy doesn`t lose.


MATTHEWS: Anyway, go ahead on that thought.

SCHMIDT: Well, the thing is that what he says to Sessions, he says that, you have not been loyal to me.

And this is a theme that we have seen with Trump before. He asked Comey about loyalty, asked Comey to pledge his loyalty. And it`s clear that loyalty to Trump is more important than an investigation about -- a freewheeling investigation that can go where it is.

And Trump is very concerned about who is running this investigation. Whether it was Comey, whether it was Sessions or Rod Rosenstein, or in this case Mueller, Trump is obsessed about who has run it.

MATTHEWS: I understand. He doesn`t want any independents out there and certainly not going after him.

Thank you, Michael Schmidt of "The New York Times," another great report.

In their report on Russia meddling in the 2016 election, the U.S. intelligence community described Russia state-funded media outlets Sputnik and R.T. as part of Russia`s state-run propaganda machine.

In an in-depth report for "The New York Times Magazine," Jim Rutenberg, for next week, by the way, examines how these Russian media outlets take advantage of open societies -- quote -- "R.T. and Sputnik operate on the stated terms of Western liberal democracy. They count themselves as news organizations protected by the First Amendment."

It`s enough cover to wage what Putin`s top deputy, Dmitry Peskov, calls an informational war. He says that the modern media landscape -- quote -- "creates a perfect opportunity for mass disturbances or for initiating mass support or mass disapproval."

Now, as Yahoo! News reports, Sputnik is under investigation for potentially violating the Foreign Agents Registration Act, FARA, which is intended to check foreign propaganda.

I`m joined right now by "New York Times" media columnist Jim Rutenberg, the author of the "Times" report.

Congratulations. Amazing piece of work, masterly.

Jim, let me ask you about this -- it is sort of Tokyo Rose stuff, if you will. It`s propaganda. It`s meant to try to infiltrate us.

Why do people like the organization on Capitol Hill allow R.T. and Sputnik and those kind of organizations to get in and join them as so called, well, news organizations?

Why doesn`t somebody just put up the wall and say you`re a bunch of flacks and propagandists; you have no more right to be here than somebody flacking for a business film; you`re not journalists? JIM RUTENBERG, "THE NEW YORK TIMES": I think there`s just a feeling that it`s a slippery slope, we are the United States of America, that we`re an open society.

And, you know, once we get in the business of deciding whose news is and who isn`t, it`s just -- it`s a very uncomfortable place for journalists, for the government.

And that`s the trick here. Right? This is why it`s a very effective tool. If you have a big vast information machine that can operate in a foreign capital and kind of get into the fabric of media, well, off to the races.

MATTHEWS: But all R.T. does and Sputnik is push these bogus stories, like the one you have in your piece about Lisa, some woman who was a young girl, 13 years old, was supposedly a Russian ethnic who lives in Germany, who was supposedly, at least for 24 hours, the victim of a crime.

It turns out she was just with her boyfriend or some guy for the 24 hours. It was clear there was no crime there, or at least not the crime that was described. And they ran with that story, even though -- even when it`s demolished as fact.

RUTENBERG: Yes, that`s the thing.

But it always does -- or not always -- sometimes, it`s outright the reports get knocked down. Sometimes, there`s a grain of truth. Sometimes, there`s more truth. Sometimes, there`s complete credibility.

It`s a mix, which is also what makes it a little bit hard to put your finger on. So, that case you referenced, the public was very upset, and in comes not just R.T., not just Sputnik, but local Russian media there in Germany and also bots and trolls and Twitter and Facebook. So, it`s a whole big storm that gets created.


How is this connected -- it seems like it is -- to the whole Russian probe we`re all covering here almost every night? Which is, somewhere in the Kremlin, I think in the heart and mind of Putin, they decided, he decided that he didn`t like Hillary Clinton.

He wanted -- at least if she won, she`s going to be a miserable president. He wanted to make sure of that by undermining her in every way in credibility, and maybe be able -- in the end, he said maybe can pull it for Trump.

Was that all part of this nexus or this matrix of, we`re all in this together, we`re on the side of Trump and against Hillary?

RUTENBERG: I think, first of all, they can point to stories that R.T. did that were critical of Trump. But often, when they got in on the Hillary side, it was the conspiratorial stuff, a lot of the WikiLeaks and health concerns, and sometimes even more conspiratorial, the Seth Rich conspiracy.

But I don`t know how -- I mean, look, the Kremlin is open about one thing. They believe that they aren`t the ones who started this information war, the U.S. did. Hillary Clinton is very much seen as a part of the establishment of the U.S. that they think are bringing, you know, kind of trouble to their borders with democracy sort of movements and NGOs and even the Western media.

So, to them, this is fighting back. And they`re open about that much. They deny a lot of what is coming at them from our intelligence community, they weren`t meddling. But they are open that there is an information war. They think that they were at some point the victims of it. And now they`re answering back.

That`s sort of the way they put it to me in plain terms, at least Putin`s spokesman, Dmitry Peskov.

MATTHEWS: Yes, I don`t take the comparison to Voice of America, because I listened to Voice of America in the boonies over in Africa for two years.

And I found, as a Peace Corps volunteer, that it was like BBC. It`s incredibly honest. It`s incredibly forthright as a news organization. It`s not a propaganda vehicle, from what I -- they talked about civil rights and all the embarrassing stuff for us back in the `60s.

It wasn`t what you would want to talk about if you were a flacking operation.

Jim Rutenberg, a great piece of work.

RUTENBERG: Thanks a lot.

MATTHEWS: I read it all. It was big. And it`s coming this Sunday, for those who really want to understand Russian propaganda 2017.

And we will be right back. This is HARDBALL, where the action is.



DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Not all of those people were neo-Nazis, believe me. Not all of those people were white supremacist, by any stretch.

Those people were also there because they wanted to protest the taking down of a statue, Robert E. Lee.


MATTHEWS: Welcome back to HARDBALL.

That was President Trump last month after the white supremacist rally in Charlottesville, Virginia, that turned violent, killing one woman.

Well, this week, Congress sent him a resolution which called for -- quote - - "rejecting white nationalists, white supremacists, the Ku Klux Klan, neo- Nazis and other hate groups."

It was passed unanimously, by the way, by both chambers, by the House and the Senate. And the White House says the president looks forward signing it.

But the president was criticize for not initially disavowing these groups and blaming what he called both sides for the violence.

On Wednesday, South Carolina Senator Tim Scott -- it`s not Tom, Mr. President -- sat down with the president and talked to him about that initial response to the Charlottesville violence.

Let`s watch this.


SEN. TIM SCOTT (R), SOUTH CAROLINA: I wanted to make sure that we were clear on the delineation between who`s on which side in the history of the nation. And so we had a good conversation.


MATTHEWS: Well, the president gave his impression of their talk on Air Force One today. Let`s listen to that.


TRUMP: We had a great talk yesterday. I think especially in light of the advent of Antifa, if you look at what is going on there, you have some pretty bad dudes on the other side also.


MATTHEWS: He can`t resist.

We`re joined right now -- we`re joined right now by Virginia`s Democratic Governor -- or Governor Terry McAuliffe.

Governor, it`s amazing. He just can`t resist throwing in this moral equivalence. Pretty bad dudes. He`s president of the United States, and he`s talking like that.

OK, what does he mean. The anti-fascists are pretty bad dudes?

GOV. TERRY MCAULIFFE (D), VIRGINIA: First of all, there`s no moral equivalent of the folks who came to Charlottesville, Neo-Nazi wearing pictures of Adolf Hitler, white supremacists, and KKK.

There`s no moral equivalent. The people who were there protesting on the other side were protesting against hate. Had they not come, Chris, we would not have had those incidences.

Unfortunately, Heather Heyer, 32-year-old young woman, was killed when a guy weaponized his car. I lost two state troopers, both of them very close personal friends of mine. One was my pilot. The other had served on my security detail.

MATTHEWS: Really, your personal pilot, the guy who...

MCAULIFFE: Very close.

MATTHEWS: ... flew you around?

MCAULIFFE: Went down in a helicopter.

So the president needs to show leadership. And I had talked to the president before he gave his speech, and that`s what I said to him. There is no moral equivalency. I came out Saturday night, told him to go home.

MATTHEWS: Who is he afraid of offending by stating he doesn`t like Nazis? I mean, really.



MCAULIFFE: You know, I got -- my father served in World War II. I got a son in the Marine Corps.

I just don`t understand it. We have got men and women who have fought and are fighting today to preserve our great freedoms and liberties. And just came out and say it.

MATTHEWS: I`m with you.

MCAULIFFE: They`re neo-Nazis.


MATTHEWS: I would rather talk about this resolution today, which I agree with. Everybody agrees with it.

I don`t like the -- the fight over statues, the problem with it -- and you`re a Virginia governor. You`re from a Southern state now.


MATTHEWS: And you`re representing people who have mixed views on this.

My problem with that is, I think it should be done locally. I think people have to make up their minds. And it could take a couple of years to take some statues down, a couple more next year. Put them in museums. Treat them with historic respect, but not look up to them.

But I also think you have problems like the Gettysburg battlefield. What are you going to do there, take down the generals from one side of the battle, not down the other? What do you with the guy in Washington Street in Old Town, Alexandria, which is a young, humble, obviously grit soldier, Southern soldier with his head down in defeat?

It`s called Appomattox. There it is. It`s not about, we`re the right side of the war.

MCAULIFFE: With his back to Washington.

MATTHEWS: Yes. We`re not the right side of this war. We just lost it.

MCAULIFFE: Listen, they ought to be in the battlefields, the museums.

Listen, there`s no question.

MATTHEWS: How about that one there, should it stay?

MCAULIFFE: Listen, well, first of all, under Virginia code, no statues before 1997. It`s all local control and the General Assembly, unless there`s something specifically in the code that protects it.


MCAULIFFE: That particular statue you were talking about, it`s in the code of Virginia. So it would take the General Assembly changing it.


Let me ask you about this whole Democratic Party. Where do you see the party going? I mean, Hillary`s book, by the way, which I -- I think the book is really good. Some of her defenses on TV get defensive, like they often do in debates with people like Matt Lauer.

But she basically said, I had -- people counted on me by the millions, and I let them down, election. It was clear, she accepted the defeat, I thought rather graciously, in the beginning of the book, you know?

Now we get all that stuff. Bernie Sanders, she blames. That is going on.

So, where are we going to be? Where are the Democratic Party going to be as we look down the road to 2018, 2020, Bernie Sanders with a strong regiment of supporters, a lot of young people? I mean, he says we don`t -- schools are going to be free. Health is going to be free. He makes it very popular.


MATTHEWS: And his brand of sort of old-time socialism has been updated to being very appealing to the young people.

Hillary Clinton is a moderate Democrat, no matter what she says. You`re a moderate Democrat. Who is going to win that fight?

MCAULIFFE: Well, first of all, the person who ought to win the fight is the one who has the best ideas and who gets results doing it.

Let`s look at Virginia today for a second. Unemployment has gone from 5.4 to 3.7. We have totally transformed our criminal justice system. I have taken juvenile justice down from 600 down to 200, record amount of jobs, record capital investment.

Unemployment claims, I just announced the other day 44-year low. People want results from politicians.

MATTHEWS: Do they?

MCAULIFFE: They`re tired of talk.


MATTHEWS: They don`t want ideology?

MCAULIFFE: They want results.

I can tell you, the people in Virginia, they`re happy, record investment in K-12, $2.4 billion investment in our higher-ed research facility. We have results.

I`m almost getting to full employment. I have so many open jobs I got to fill. That`s why we`re forming our education system. We are now teaching cyber-security in kindergarten. We`re leading on work force development, 50,000 stem age credentials I announced...


MATTHEWS: I`m with you on that.

But your state, like North Carolina, a little bit behind you, but on the same route, it`s modernizing. It`s becoming a high-tech state.


MATTHEWS: Highly educated, tremendous university system.


MATTHEWS: Then you have states like Wisconsin, Pennsylvania, Michigan, that haven`t been able to get on that track. They`re still in the industrial age in many ways.

And they don`t like what`s going on now, because they`re losing jobs and pay. How do you talk to those people?


MCAULIFFE: Yes. You got to build that new economy.

The one thing I`m probably...

MATTHEWS: Do you think that will work, a new economy in states like Pennsylvania, a new economy?

MCAULIFFE: Well, look at Virginia, a very rural state.


MCAULIFFE: But you know what is nice, Chris?

The unemployment in my rural communities has all gone down, Lancaster, Paige, very rural. Down seven percentage points. Every one of our counties has gone down. We`re leading cyber-security, data analytics. We`re leading on unmanned aerial systems.

It is a new economy. You have got to get into that. That`s why governors have to lead. We`re out front on job creation, economic empowerment, creating...


MATTHEWS: See how good he is?

Terry McAuliffe, who still wears the green tie of his people.

Thank you, Terry McAuliffe.

MCAULIFFE: The Irish...


MCAULIFFE: And the American flag.

MATTHEWS: Up next -- both of them. That`s good.


MCAULIFFE: Got the whole deal.

MATTHEWS: Up next, we`re going to get a report from St. John. And that`s one of the islands really hit by Hurricane Irma. That`s in the Virgin Islands, the U.S. Virgin Islands.

You`re watching HARDBALL.



JARED KUSHNER, WHITE HOUSE SENIOR ADVISOR: I did not collude with Russia, nor do I know of anyone else in the campaign who did so. I had no improper contacts. I have not relied on Russia funds for my businesses. And I have been fully transparent in providing all requested information.



Welcome back.

Denying any collusion with Russia, President Trump`s son-in-law there, an adviser, Jared Kushner also denied any impropriety in that December meeting with the head of Russia`s state owned bank.

Well, since that meeting, Kushner has divested from his family`s business. However, "The Washington Post" reports today that as investigations proceed, pressures at 666, there`s a problem, 5th Avenue are building. In 2007, then 26-year-old bought that Manhattan address for $1.8 billion, the highest price paid at that point for any office tower in the United States.

"The Washington Post" points out that expert speculate that Kushner had vastly overpaid and that months after buying the building, the great recession pummeled values.

Now, Kushner`s role in government has made the Kushner company`s Manhattan property toxic to potential investors. As Kushner friend Tom Barrack told "The Washington Post", Kushner`s move to the White House just about completely chilled the market. Potential investors just said, no way, can`t be associated with any appearances of conflict of interest.

Let`s bring in tonight`s HARDBALL round table. Eliza Collins is Capitol Hill reporter for "USA Today", Jason Johnson is politics editor for "The Root" and MSNBC contributor as well, and Zeke Miller is the White House correspondent for "Time".

Zeke, I want you to start on this. It looks to me that this young guy put down his note for $1.8 billion without any way to pay for it, hoping that somehow the revenues from rentals would bring it in. Then he runs into trouble because there was a great recession. He had the sell off the retail spaces, killing his revenue flow and then he sold off like half of the office space, again killing off a lot of his revenue flow. So, he owes tons more all this money. There`s nobody to invest in him and he`s got a very little revenue flow coming from rental.

I don`t see how he`s not in the hock big time and he`s not going to get out of it, while he`s a senior assistant to the president.

ZEKE MILLER, WHITE HOUSE CORRESPONDENT, TIME MAGAZINE: It`s certainly a financial issue for him and part of the reason why he`s having trouble attracting investors is that people don`t want to associate themselves necessarily --

MATTHEWS: How can he sit in the White House and try to get himself out of the ditch while he`s in the White House?

MILLER: You know, there are processes in terms of what he controls, what he doesn`t control in terms of how he tried to divest from that. But that is an open question. We need to hear at some point from Jared Kushner how he`s not exposed, how he`s not vulnerable here if he is in that financial state.

MATTHEWS: OK, I`m Jared Kushner. I`m at the White House, here`s my number, 456-1414, the United States White House.

So, he calls around the Chinese or probably the Russians asking for money. Isn`t that a conflict of interest? I need money. By the way, you`re going to reach me? I work at the White House.

All of these foreigners were all thinking and buy any government, a lot of them. They always think you can buy because a lot of governments can be bought. Hey, here`s a way to buy the government. Bail this guy out.

JASON JOHNSON, MSNBC CONTRIBUTOR: Chris, it`s not only a conflict of interest, it`s not only a problem for him, his businesses and President Trump, but here`s the most valuable thing he has. He`s got a security clearance.


JOHNSON: So when people do call him, they`re not asking to invest in his businesses. They`re asking him very likely to reveal or give hints about information that would endanger him and endanger this entire administration. So, you know, he`s sitting on a gold mine, but it`s not --

MATTHEWS: What makes you think that being something he can negotiate?

JOHNSON: Well, because those would be the kind of question you would ask. Think about the meeting that he went to that Don Jr. had. It`s like, hey, you`re a government person. Do you know anything about Hillary Clinton?

You can imagine those kinds of questions being asked of Kushner. Look, we don`t want you to give us state secrets. Just tell us a little bit of what was going on in the White House.

MATTHEWS: OK. I want to know what he was doing with the head of the Russian bank. You might go to the bank for money.

ELIZA COLLINS, CAPITOL HILL REPORTER, USA TODAY: He said it had nothing to do with his businesses.

MATTHEWS: Even though he`s in hock.

COLLINS: Well, it`s just -- there`s an issue here, especially with investors, don`t want to get involved with anyone in the White House. He`s now under investigation for things like these meetings, where it comes up, when he talks to Congress potentially.


COLLINS: Why would you want to subject yourself to this and be, you know, questions there`s an FBI investigation, a congressional investigation, and then also just news, headlines, conflicts of interest.

MATTHEWS: Well, you know, the argument that the president makes is that there`s no -- he has no involvement economically with Russia, and denied involvement, Zeke. And over and over again, we keep hearing about these involvements.

MILLER: Yes. I mean --

MATTHEWS: All entangled in the same meetings for all we can tell.

MILLER: That`s been their problem on this, they deny, deny, deny, and then it drips out that the denials were blanket when they should have been caveated every which way. You know, in terms of what Robert Mueller has to deal with now, it`s always -- it`s -- maybe it`s not the crime --

MATTHEWS: Do you think the president can fence himself off from his family now? I never liked this nepotism. I didn`t like it in the beginning. I fought it here. And they got away with it. They found a law that allowed them to do it. They have good lawyers.

And my question is, can the president separate himself from his own family now?

MILLER: The question is, legally or politically?

Politically, probably not. He fought --

MATTHEWS: OK, he`s not taking them on the trip to China. What does that tell you? He`s not taking Ivanka or husband Jared Kushner on this trip to China. Is that related to this? Is there a taint there? He`s saying, OK, I`m not going to travel with them anymore.

Or is John Kelly, the chief of staff, finally getting control of reality in the White House and saying, Mr. President, you`ve got to stop hanging around with their Romanov family of yours, they`re causing you trouble?

COLLINS: I think John Kelly could very well be putting separations. But I don`t think President Trump is saying I want you guys to stay away because --

MATTHEWS: How come they`re not going to China with him? Do you know?

COLLINS: I mean, there`s --

MATTHEWS: Do you know, Zeke? Who knows why they`re not going? Because we got the word --

JOHNSON: Because it`s dangerous, because people don`t want to be involved. And also, they don`t --

MATTHEWS: Let read you. I don`t often read this newspaper, "The South China Morning Post".

Ivanka Trump and Jared Kushner`s trip to China may have been canceled because some officials in the White House decided the couple were not suitable to make preparations for U.S. President Donald Trump`s visit to Beijing.

JOHNSON: They sent this guy to negotiate Middle East peace process. He`s got no expertise in this, outside of the fact that they have --

MATTHEWS: Well, finally, somebody`s noticed.

Anyway, "The South China Morning" did report that. Anyway, what do you make of it? This thing is going to bug Trump. It makes look like his daughter is tainted.

COLLINS: Well, Ivanka Trump also has her whole fashion line and there`s issues with that in China. So, that could be John Kelly saying no, but who knows?

MATTHEWS: There`s something I know nothing about.

JOHNSON: Everybody is afraid of a desperate man. This is like, you know, Denzel at the end "Training Day". No one takes your phone calls anymore. You`re in trouble. You`re in hocked to a bunch of different people, and the fear that being connected with Jared Kushner could put you in ire in the United States, but possibly get you in some sort of international trouble, no one wants to touch --

MATTHEWS: Reference to Denzel Washington, Oscar winning performance in "Training Day" here. Go ahead.

MILLER: No, I mean, part of that, too, in terms of that trip is, you know, the Chinese in particular are sensitive to issues of protocol. Are they the best face of the United States, the best face of the presidency? Certainly, John Kelly is well-versed in those things.

MATTHEWS: He`s looking good. They`re going to give him an Oscar for being chief of staff at this point.

Anyway, the roundtable is sticking with us. And up next, these three will tell me something I don`t know. We`ll be right back.


MATTHEWS: We`re back with the HARDBALL roundtable.

Eliza, I love that name, tell me something I don`t know.

COLLINS: I`m going to go to Capitol Hill.


COLLINS: Talked to Mark Meadows today. Conservatives say --

MATTHEWS: Leader of the Tea Party.

COLLINS: Leader of the hard line Freedom Caucus, very conservative, said they`re not worried about this deal with the Democrats because they`re working with the White House on legislation that would do DACA.

MATTHEWS: They`re going to deal with it on their side?

COLLINS: Yes, he said they`ve had meetings with the administration.

MATTHEWS: It would be helpful to those young people, the 800,000 here?

COLLINS: He said that there will be something for those 800,000 people.

MATTHEWS: Maybe. We`ll see.

JOHNSON: What you may not know is a month ago, the Missouri state legislature was going to kick out Maria Chappelle Nadal because she is a state senator who posted on Facebook that she hoped that President Trump was assassinated. What you may not know is that yesterday they decided, I guess we can only censure her instead of kick her out. Why? Because they found that another Republican in their own party had actually posted anyone that complains about Confederate monuments should be hung, and they didn`t want to apply the same standard to their own party.

MATTHEWS: The proper term, by the way, is hanged.

JOHNSON: Hanged.

MATTHEWS: We got to get that right.

Thank you, Zeke.

MILLER: Yes, at the White House they believe the last two weeks have been among the best of the Trump presidency, between the response to the hurricane which has been shown competence and also DACA.

MATTHEWS: I agree. I don`t like him, but I bet he`s over 40 percent, I made that bet last night.

Anyway, Eliza Collins, Jason Johnson, no money, just a gentleman`s bet, Zeke Miller.

More to come tonight. I`m not sure I`ll stay but I think he will creep up to 40 percent this week.

Stay with us.


MATTHEWS: Welcome back to HARDBALL.

The Caribbean, of course, took a devastating hit from Irma, known for their sprawling beach resorts and islands. They`re now recognizable with destroyed -- look at this -- destroyed buildings, scattered debris, damaged boats, residents still without power or cell reception. This is a real hit down here.

For the latest on what`s happening on the ground, let`s go to Stephanie Ruhle in St. John on the U.S. Virgin Islands.


STEPHANIE RUHLE, NBC NEWS CORRESPONDENT: We are here in Cruz Bay in St. John. For anyone thinking that Irma is over, the aftermath continues. Here in the U.S. Virgin Islands, every person, whether they lost their house or lost their job, they have been affected by this storm.

Tonight, as the rain continues, we`re even trying to stay, the road is washed out. There is no vegetation left. So, it is so dangerous there could really be landslides.

Already, FEMA has come. They have delivered 400,000 meals, 270,000 liters of water. But that is only the beginning.

The hospitality industry many say, it accounts for 60 percent of the GDP for islands like this, but it is not 60 percent. It is closer to 80 percent. And the real question is going to be: how long is it going to take to really get infrastructure back?

Earlier, we went up and saw the health clinic. They have so few supplies at this point. Remember, this isn`t the continental U.S. It is going to take such a long time to really restore things.

We`ve spoken to people today who have lost their homes, who now are simply trying to get tarps ahead. It`s going to be another night with rain above and people are simply trying to stay safe.

Luckily, there is more military presence. There`s a curfew put in place, so you don`t see people walking around the streets. There was some looting earlier this week. But it`s really people trying to look for food and safety.

And at this point, countries like this, islands like this, we need to remember that it`s the U.S. Virgin Islands. And they certainly need aid.


MATTHEWS: Thank you, Stephanie Ruhle.

By the way, I did sit on that dock in Cruz Bay once. What a place.

When we return, let me finish tonight with "Trump Watch."


MATTHEWS: "Trump Watch", Thursday, September 14th, 2017.

The great liberal historian Arthur Schlesinger Jr. said politics is a learning procession. You learn as you go along. Well, yesterday, the Democrats joined in correcting a mistake they made in the wake of Charlottesville. In the wake of that neo-Nazi protests, they allowed the issue to shift from the president`s moral equivalency about Nazism and anti-Nazism to the question of statutes of Confederate leaders. The Democrats shifted the question which 90 plus percent of the people disagreed with President Trump to an issue that remains a hot debate somewhere between the 40 yard lines.

This is not the first time I recall that the Democrats decided to pick the wrong line on which to fight. I remember when President Reagan was caught selling missiles to the ayatollahs in Iran, and they allowed the issue to shift to the administration using the profits from that sale to arm the Contras in Nicaragua. Why did the Democrats let Reagan shift from an issue of national betrayal to a question of whether or not we should arm an anti- communist faction in Central America? It was another case of choosing an ideological position on which to fight over a winning issue on which to fight.

Well, yesterday, the Democrats got it right by joining in the joint resolution which President Trump will be forced to sign that puts the fight back where it belongs, in condemning neo-Nazis and KKK`ers and other American hate groups. It`s not only the moral position to take, it`s one that will clearly remind the country that it was the Democrats who had it right after Charlottesville and the Republican president who had it wrong. Wrong morally.

That`s HARDBALL for now. Thanks for being with us.

"ALL IN WITH CHRIS HAYES" starts right now.


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