Mueller probe hits DOJ Transcript 11/20/17 The Beat with Ari Melber

Guests: Gerry Smith, Jenna McLaughlin, Elizabeth Spiers, Russ Feingold, Ryan Reilly

Show: THE BEAT WITH ARI MELBER Date: November 20, 2017 Guest: Gerry Smith, Jenna McLaughlin, Elizabeth Spiers, Russ Feingold, Ryan Reilly

KATY TUR, MSNBC HOST, "MTP DAILY": For instance, Jackie Kennedy was known for her fondness of picking the tree themes of the White House and for spending holidays in, you guessed it, Palm Beach.

That will do it for me tonight. We'll be back tomorrow with more "MTP Daily". THE BEAT with Ari Melber starts right now. Hi, Ari.

ARI MELBER, MSNBC HOST, THE BEAT: Hi, Katy. Thank you very much. Tonight, the big news on the Russia probe is an escalation in this investigation. Bob Mueller is now seeking evidence from his own bosses in the Trump Justice Department.

Mueller has, of course, the authority to get documents from the agency overseeing his Russia investigation. That includes the man who appointed him, Rod Rosenstein, and the man who says he's recused from this probe, Jeff Sessions, who was back in Congress, you may recall, just last week explaining his own contacts with Russians and statements about them.

Now, the news tonight is that Mueller is not only putting his bosses in a tough spot, he's also scrutinizing their own potential role in any obstruction inquiry because the two men laid out a rationale for firing FBI Director Jim Comey.

Remember their letter, they said he was wrong in the way he handled Hillary Clinton's e-mail investigation, that the FBI could not regain trust until a new director understands the gravity of Comey's mistakes.

Now, that letter was really odd at the time. And then, you may remember this too. It looked even odder when Donald Trump admitted on television to Lester Holt he fired Comey with Russia on his mind, not that Clinton investigation in the letter that came out that week from those people running DOJ.

So, tonight, we can report for you, Mueller is probing those conflicting story lines along with DOJ communications with their White House counterparts. And that means, Bob Mueller is checking whether Trump loyalists involved in that now infamous firing, like Stephen Miller, ever reached to the DOJ about their story line, which crumbled on television.

Miller reportedly wrote one draft of the Trump letter to fire Comey. "The Washington Post" also reporting that nervous aides in the Trump White House are basically talking about their nervousness.

A source fearing Mueller heading towards a "classic Gambino style rollup" - hello - while other staffers reportedly now greet each other by saying, good morning, are you wired? And there is nothing wrong with a little gallows humor when you're going through a tough time.

But let's take a step back here on this Monday evening. The Russia probe has had its dramatic moments before. This is an administration that thrives so much on drama, sometimes it seems to create it when there is a quiet week on the horizon.

But note that in the Washington picture tonight, the drama is now hitting a truly constitutional dimension. A federal prosecutor collecting evidence on his own supervisors at DOJ and looking at how they dealt with their supervisors at the White House with a mission to determine if, if there was a plot to obstruct justice.

And if there was, was it hatched with the knowledge or cooperation of the people that Donald Trump put in charge of defending justice? That is our top story tonight.

And I'm joined by Bob Bauer, a man who knows these types of investigations well. He served as President Obama's White House Counsel. He's now a professor at NYU Law. Also with me, Shelby Holliday from "The Wall Street Journal" and a former FBI special agent, Clint Watts.

Bob, I begin with you because this is the kind of inquiry that you very happily, I would imagine, did not have to handle. It runs to the crux of whether there was any effort at obstruction by the people who were supposed to carry out laws of the United States.

BOB BAUER, PRESIDENT OBAMA'S WHITE HOUSE COUNSEL: Yes. That's right. And I certainly was very happy not to have handled it.

But you're correct also that the so-called supervisors of Bob Mueller nonetheless have to respond to him as the special counsel. And as government employees, they have to give evidence in a criminal case. So, it's fairly straightforward that they're going to be compelled to provide the information that he needs to inquire deeply into this obstruction possibility.

MELBER: And, Clint, you've done interviews as an FBI agent, right?

CLINT WATTS, FORMER FBI SPECIAL AGENT: Yes. That's right. It's going to be interesting to pare what comes through in those documents, what's really in the White House team, and what you hear from the DOJ folks.

I think in terms of preparation, how they understand their job, the DOJ personnel that are giving up documents are going to be much more on task and much more to the point.

What's going to be odd or sort of interesting is the merger between the obstruction case and Russian influence. So far, we've heard about Russian influence a lot. Now, we're starting to see obstruction part.

And the and real question is, were President Trump's actions related between the two?

MELBER: Were they related and how did the DOJ respond? Did they get hoodwinked, which is embarrassing, but not usually criminal? In fact, it makes you more of a victim. Or was there a plot? Was there a discussion of, well, we'll write a fake letter when we really know what this is about? And as I often say when we cover this stuff, we just don't know. That's an allegation. That's not a conclusion.

But Jeff Sessions himself was asked about this under oath and he says he hasn't even heard from Mueller yet. Take a listen.

(BEGIN VIDEO CLIP)

JEFF SESSIONS, ATTORNEY GENERAL OF THE UNITED STATES: I have not had any discussions with Mr. Mueller or his team or the FBI concerning any factors with regard to -

REP. JERROLD NADLER (D), NEW YORK: Nobody else at the FBI either?

SESSIONS: No.

NADLER: And at the Department of Justice?

SESSIONS: No.

NADLER: At the White House?

SESSIONS: No.

(END VIDEO CLIP)

MELBER: Clint, when this thing is over, would you expect that Mueller's team will talk to sessions?

WATTS: I think the last people interviewed are those that are pretty much at the top of this organization, the top of the two investigations.

So, you're going to be looking at people like Sessions, Stephen Miller. They're going to be the last ones folded into this. You want to collect everything around the periphery of these investigations first before you bring it to those people during the interview process. You want to nail them down with all of the perspectives, with all of the data.

And I'm sure that's why they've been going to DOJ over the past few weeks and asking for those records to see, does it line up with this sort of potential pressure that might have been coming from the White House.

MELBER: And, Shelby, the politics of this are, we're going into Thanksgiving. Donald Trump looking for other fights, talking about sports and stuff that people talk about around Thanksgiving.

SHELBY HOLLIDAY, REPORTER, "THE WALL STREET JOURNAL": Talking about being thankful at the briefing today, right?

MELBER: Being thankful. Yes. Layers and layers of gratitude.

HOLLIDAY: Positive spin.

MELBER: Good vibes only at the briefing room is generally a good rule of thumb if you can get there. But talk about the politics here of the inquiry that, again, goes back to Donald Trump's style of governing.

Because I heard from people who like Donald Trump that he was going to shake things up. I heard that out in New Hampshire and other places, but I don't think they were imagining shake things up like fire a bunch of people in a really clumsy way that creates all this drama, where even if you're a Trump supporter, you're like, wow.

You got so close to what might look like obstruction that you're wasting a lot of the time and the agenda.

HOLLIDAY: Right. Well, a good question with obstruction is intent, right? Did the president obstruct justice? And if so, can you prove intent?

One thing about Donald Trump's entire career is that he's fired people before, he made a name for himself firing people on television. That is part of who he is.

But was he prepared to be the president? Did he know that this would get him in such legal hot water? And is it something that was intentional or is it just like a mistake that he made because that's who he's been and he's been able to get away with it his whole career?

I think the news this week is very clear that Mueller is not ending by Thanksgiving as was some wishful thinking in the White House, but Mueller is still aggressively continuing down two paths, the obstruction of justice path and also the Russia collusion path.

Now, we could see those come together with any sort of charge against Flynn. NBC reported recently that Mueller has enough evidence to charge Flynn. We don't know, however, how he might tie those two things together.

MELBER: And you mentioned previous firings. Bob Bauer, as a White House counsel, I think you understand there's a difference between firing, say, Lil' John and Jim Comey. Those are different personnel moves, I think it's fair to say, and firing on a TV show versus removing the first FBI director - again, it can't be said enough - in history without any stated cause.

The only other FBI director removed (INAUDIBLE) was after an internal report found embezzling, wrongdoing allegations.

What do you think they need to do to right the ship? Step back from all the investigations to say, do you see bad judgment, bad lawyering or bad approach? How do you fix that as someone who's had that rare job you've had as being a White House lawyer?

BAUER: It's very difficult to judge bad lawyering because you don't know what sort of a client people are dealing with. I mean, lawyers sometimes can't rise above the sins or mistakes of their clients.

The first thing they can do, and I think everybody recognizes, is avoid making things worse. And so, obviously, one of the objectives of bringing Mr. Kelly in - Gen. Kelly in as chief of staff and of having Mr. Cobb in as essentially the lawyer/policeman in the building was to restore some discipline to avoid missteps that would only make this situation worse.

And I can't emphasize enough, particularly with a president who has a passion for tweeting, how important it is to not make additional mistakes, to not do something that makes the situation worse.

MELBER: And how do you view the reports that Don McGahn, who has your old job, did intervene, that he saw something in the first draft of this Comey firing letter that he intervened. I mean, that doesn't mean he thought it was just maybe poorly worded?

BAUER: You're talking about the draft that put it off on Mr. Comey's treatment of Hillary Clinton.

MELBER: Yes. And the original draft that Stephen Miller allegedly wrote that was Donald Trump basically listing off, what one reporter called, a screed, reasons why he didn't like Jim Comey.

BAUER: Well, you have to fill in the details. I don't know exactly when Don McGahn saw the draft and what he saw in the draft, but I think you can assume he's doing what the lawyer needs to do, stepping in when the non- lawyers are solving what they think is their political and communications problem, and bringing to their attention what the legal implications that their behavior might be.

MELBER: And when Mueller looks at a letter like that, a first draft that didn't go out, is that potential evidence?

BAUER: Absolutely. It's all evidence. The question is what sort of weight is given to the evidence and what will the evidence plays in the developing narrative. But evidence, it certainly is.

HOLLIDAY: There are also letters out there, for example, the one written on the plane that Hope Hicks was exposed to regarding the Trump Tower meeting with Don, Jr. and Jared Kushner and Paul Manafort. There are a lot of letters. There is a lot of evidence in writing and that will take time to sift through.

MELBER: Exactly.

HOLLIDAY: Not wrapping up anytime soon.

MELBER: And that's where we're headed.

Shelby Holliday, Bob Bauer here in New York, thank you. Clint Watts reporting for us as well, appreciate your analysis.

Coming up, the Trump Justice Department moving tonight to block a media merger. Breaking news. Is this about CNN and Trump's agenda?

Also, there are new revelations about Jared Kushner's old newspaper and its links to WikiLeaks during key period of the campaign.

Also, Trump administration is putting a journalist on trial and it all relates to inauguration protest, an important story.

And former senator Russ Feingold talking about money in politics and draining the swamp. Only on THE BEAT tonight. I'm Ari Melber and we will be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Your thoughts on Roy Moore, Mr. President? Do you believe his accusers, Mr. President?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Thank you very much.

(END VIDEO CLIP)

MELBER: That is what it looks like when Donald Trump is silent, a rare sight. But he remains silent on this Roy Moore scandal. This has now continued, we've been continuing, for 11 days.

Now, one of the Moore accusers, however, is speaking out about how she was 14 when she met Roy Moore.

(BEGIN VIDEO CLIP)

LEIGH CORFMAN, ACCUSER OF ROY MOORE: He basically laid out some blankets on the floor of his living room and proceeded to seduce me. During the course of that, he removed my clothing. He touched me over my clothing, what was left of it. And he tried to get me to touch him as well.

(END VIDEO CLIP)

MELBER: The largest news publisher in Alabama is turning against Moore. Now, Moore had also been ahead of Doug Jones pretty consistently, averaging a 6-point margin.

Now, you can see Jones is pulling ahead by a bit. Moore denies all the sexual misconduct allegations and is now blaming Mitch McConnell.

(BEGIN VIDEO CLIP)

ROY MOORE, GOP CANDIDATE FOR ALABAMA SENATE SEAT: Mitch McConnell who wants to stop this campaign.

I believe with all my heart that Mitch McConnell and the establishment are in cahoots with the Democrats to stop this campaign.

(END VIDEO CLIP)

MELBER: I'm joined now by Laura Bassett, a senior political reporter for "The Huffington Post" and Howard Dean, a former DNC chair and former governor.

Laura, I don't know how much time we should spend on conspiracy theories - one of the newsroom choices we make - but if Mitch McConnell were behind this, they would have intervened on this during the primary, not at this time. That's just a quick rebuttal. But speak to us about the deeper issues here.

LAURA BASSETT, SENIOR POLITICS REPORTER, "THE HUFFINGTON POST": I think the reason Mitch McConnell has asked for him to step down is because he knows the conservative movement is over if they allow men like Roy Moore to be elected to office after being accused of child molestation and essentially sexually assaulting a 14-year-old.

How can you claim any kind of moral superiority here as Christian conservatives if you're going to allow a child molester to be in your ranks?

And so, I think Roy Moore is just completely turning a blind eye to what's going on and trying to save himself however he can.

MELBER: And his response, of course, has created an environment where, I think, the accusers are speaking out even extra. Here's Leigh Corfman talking about where the story came about because now, not only the underlying allegations, but the question of why now, which can be a question in politics, and here was her answer.

(BEGIN VIDEO CLIP)

CORFMAN: "The Washington Post" sought me out. I didn't go looking for this. This fell in my lap. I told them that, at the time, the reporters, who were all just wonderful to me, that if they found additional people, that I would tell my story. And they found those people.

I've voted as a Republican for years and years and years. But this isn't political for me. This is personal.

(END VIDEO CLIP)

BASSETT: Look, we all know that there's a first mover disadvantage that applies to rape victims, sexual assault victims, sexual harassment victims. Women know that, if they come forward by themselves, if they come forward first that they're likely not to be believed. It's just a reality of society as it always has been.

And so, we're having this moment, this massive cultural reckoning here where all these women are coming forward and suddenly other women are realizing that they can come forward too and be believed.

And so, that's why now. I don't understand how people are still even asking that question.

MELBER: Yes, yes. Governor Dean?

HOWARD DEAN, FORMER GOVERNOR OF VERMONT: This is a test for evangelical Christians. Are they really Christians or are they simply right-wing, mean-spirited conservatives? This is a test for the State of Alabama. Are they going to turn their back on what has gone on in Alabama for a long time and say no, it's a new day, we're going to do the right thing?

There's no question about this. it's not as if you have somebody that's way out of step with where Alabama is in Doug Jones. Doug Jones is a great candidate. He's a moral candidate. He's done a lot of great things for the state.

He comes from Alabama. Both his parents grew up there, blue collar, hard- working people. There is no contest. This is a moment of truth for the State of Alabama and for the evangelical Christian movement.

So far, the evangelical Christian movement has failed their test. We'll see what happens to the State of Alabama.

MELBER: Well, Howard says moment of truth, Laura. There was "Fox & Friends" today - or on "Fox News" with Brian Kilmeade. I don't know if it was a moment of truth. I don't know how much truth there is in the next 40 seconds I'm going to show you, but this Kellyanne Conway's way of dodging some of this.

(BEGIN VIDEO CLIP)

KELLYANNE CONWAY, COUNSELOR TO THE PRESIDENT: And Doug Jones in Alabama, folks, don't be fooled. He'll be a vote against tax cuts. He's weak on crime, weak on borders, he's strong on raising your taxes. He's terrible for property owners.

BRIAN KILMEADE, "FOX NEWS" ANCHOR: So, vote Roy Moore?

CONWAY: And Doug Jones is a doctrinaire liberal, which is why he's not saying anything and why the media are trying to boost him.

KILMEADE: So, vote Roy Moore?

CONWAY: I'm telling you that we want the votes in the senate to get this tax bill through.

(END VIDEO CLIP)

MELBER: Do we have the right language for what that was? Not an endorsement - but first Laura, then governor.

BASSETT: I mean, it was basically an endorsement, right? The White house is telling Alabamians essentially vote for Roy Moore because we're going to choose a child molester over a Democrat, because it's more important to pass our tax bill than it is protect actual children.

And let's not forget that the tax bill takes away healthcare for children, it defines a fetus as a person, it takes away tax credits for teachers. So, I think, essentially, what she's saying is, we're going to prioritize unborn children and Republican politics over actual children who have been and who will be hurt in the future by this policy and by this politician.

MELBER: Governor?

DEAN: Well, the truth of that tax bill is, if you make less than $75,000 a year five years from now, your taxes will be higher, not lower. This is a tax bill that's aimed Donald Trump - not his constituency, but his friends. They will get a huge tax break. Average Americans will see their taxes go up and their benefits go down.

So, there's nothing here that has anything to do with what Kellyanne Conway said, which is not unusual because she generally doesn't get invited to go on television, except for "Fox", because she doesn't make any sense at all.

This is a true moral test. Are you going to prioritize election of a child molester or are you going to stand for what's morally right for the State of Alabama? Only Alabama voters can make that decision. I think they're going to do the right thing and elect Doug Jones.

MELBER: Howard Dean and Laura Basset on a story that keeps on going. Thank you both.

Still ahead, this is a really important breaking story tonight. The Trump Justice Department now, tonight, announcing a new lawsuit to block a media merger. Which could be, people say, a good thing unless it's just a way to target CNN.

And how Jared Kushner's newspaper promoted stories regarding WikiLeaks during his father-in-law's campaign. I have the reporter who broke the story.

(COMMERCIAL BREAK)

MELBER: Breaking news tonight on Donald Trump's attacks on the media and whether his administration might violate the First Amendment by targeting CNN. This is an unusual story to say the least.

Now, let me explain what's going on. Tonight, there are antitrust prosecutors at the Trump Justice Department who are going to court and they say they want to block the merger of two big media companies, AT&T and Time Warner.

Many critics who say media companies are getting too large - you've probably heard about that. It's actually a critique you usually hear on the left. And usually, on the other side, free market conservatives say the government should stay out of these kind of mergers.

So, what's happening right now? The republican DOJ is trying to block this merger. Now, Trump's critics say this unusual position stems from his obsessive critique of CNN.

Now, we don't know technically if that's true, but there is a report that the Trump DOJ basically said they would the block whole merger unless AT&T were to sell CNN.

AT&T and its CEO addressed the CNN question tonight, suggesting Trump is abruptly changing antitrust law, an approach that could compromise First Amendment freedom.

(BEGIN VIDEO CLIP)

RANDALL STEPHENSON, CEO, AT&T INC.: Nobody should be surprised that the question keeps coming up because we've witnessed such an abrupt change in the application of antitrust law here. But the bottom line is that we cannot and we will not be party to any agreement that would even give the perception of compromising the First Amendment protections of the press.

(END VIDEO CLIP)

MELBER: How unusual is all this? Well, tonight, "The Washington Post" reporting this is the biggest antitrust case to hit Washington in decades, fraught with legal and political risks for both sides.

AT&T saying, as you heard there, the Trump administration's position is radical, inexplicable, but they welcome the case because Trump's prosecutors have to bear the burden of proving to a judge that the merger is illegal.

Now, we do know about Trump's CNN fixation. He's tweeted about CNN 445 times. That's triple his tweets about "The New York Times", eight times his tweets about "Fox News". And he talks about CNN all the time.

(BEGIN VIDEO CLIP)

TRUMP: CNN which is so bad and so pathetic and their ratings are going down.

They have been fake news for a long time. They've been covering me in a very dishonest way. CNN and others. NBC is equally as bad.

UNIDENTIFIED MALE: You're attacking us, can you give us a question? Can you give us a question?

TRUMP: I'm not going to give you a question. You are fake news.

(END VIDEO CLIP)

MELBER: Tonight, the DOJ is stressing this move is all about combatting media consolidation under the law, not targeting any particular media company.

They say the president's comments about CNN not a factor. Now, it's no secret that Donald Trump talks a lot of trash about the press.

Tonight's story is not about talk. This is a story about government power and whether, as some allege, it is being abused right now tonight to retaliate against the free press.

I'm joined by a former aide at the justice department, Matt Miller; and Gerry Smith, who is covering this story for "Bloomberg".

Matt, I'll begin with you. A lot of people interested in these issues. MSNBC, known as something of a competitor to CNN, although that's not how we look at this story. And I should mention, my brother works at Turner, which is owned by the parent company over there.

But the bigger question is, whether this is a normal thing DOJ is doing about mergers under a Republican administration or not. Your view?

MATT MILLER, FORMER DIRECTOR OF THE OFFICE OF PUBLIC AFFAIRS FOR THE DEPARTMENT OF JUSTICE: No, it's a normal thing. In fact, DOJ hasn't brought a case against a vertical merger like this in many, many years.

Look, you can make a substantive case for this merger and you can make a substantive against this merger. And the question always has been whether there's been political interference, not just given the president's attacks on CNN, but because he said during the campaign that he would try to block this merger, something the president shouldn't be involved in at all.

The question for me has always been where is the career staff at DOJ? Where have they been? What is their take on this?

And, today, I talked to one of the parties involved in the case, who said that their discussions with the career staff was going along fine for months. They were negotiating a consent decree, which is how these usually get involved where the parties agree to refrain from certain behaviors once the merger is completed.

And then the political leadership showed up, specifically Makan Delrahim, the new antitrust assistant attorney general, who oversees that division, showed up when the job was confirmed by the senate.

Came from the White House directly, his previous job, and suddenly the discussions changed. And the Department of Justice then started insisting on a full divestiture.

MELBER: Let's pause on that because you're talking vertical integration, you're throwing around new prosecutor's names. That's a lot.

But what you're saying is that non-partisan people were not going to block this merger probably. And then, you're saying this gentleman that I don't think most people have heard of until today, Mr. Delrahim, comes in as a political guy, as Trump's guy, and starts changing the tune.

And that's essentially notable, because we were doing the research, he had, before all of this became trumpified, he had said he didn't think the merger will be blocked either. Take a listen to this.

(BEGIN VIDEO CLIP)

TRUMP: As an example of the power structure I'm fighting, AT&T is buying Time Warner and thus CNN, a deal we will not approve in my administration because it's too much concentration of power in the hands of too few.

(END VIDEO CLIP)

MELBER: That's interesting context because it's Donald Trump's warning. But let's go ahead and take a listen, as I mentioned, to Makan Delrahim. This is the person that Trump hired who is tonight taking this merger to court, but previously hadn't suggested he would do that. Take a listen.

(BEGIN VIDEO CLIP)

MAKAN DELRAHIM, UNITED STATES ASSISTANT ATTORNEY GENERAL FOR THE ANTITRUST DIVISION: Just the sheer size of it and the fact that it's media, I think, will get a lot of attention. However, I don't see this as a major antitrust problem.

(END VIDEO CLIP)

MELBER: So, when did he change, Matt?!

MILLER: It's a good question because that was his position before he went to work for Donald Trump. And after he went to work for Donald Trump, he - - in the White House, later DOJ -- he apparently took a completely different position. And as you were asking before, you know, in terms of the career people, who knows where this would have come out but their discussions I was told with the two merging companies all revolved around a consent decree and that later changed.

MELBER: Gerry?

GERRY SMITH, REPORTER, BLOOMBERG: Yes, I mean, I think that it's -- you know, we can see right now that AT&T certainly, you know, we talked about - - we reported on how their strategy in trial is going to be to actually look at communication between the provided (INAUDIBLE) Justice Department. So you know, while the AT&T CEO said today that he doesn't think CNN was a factor in this, certainly that's --

MELBER: He didn't say that -- he didn't say that. He says he didn't know.

SMITH: He said he didn't know.

MELBER: And there's other reports that they were bullying these two companies to sell CNN. I guess if true, which is always the thing, if true, would that be a normal way to deal with this kind of merger, to sell one random news organization?

SMITH: No. I mean, in fact, if look at the Comcast-NBC deal which a lot of observers have looked at, Comcast didn't sell any NBC entities in order to get that deal through. What they did was agreed to a certain conditions that they would follow. You know, some critics have said that Comcast may not have followed this conditions but you know, the DOJ official that just took place says that you know, I don't believe really believe in that sort of thing. I would rather see you know, certain properties get sold in order to you know, get this deal through.

MELBER: Which I think is what's going to be so interesting because this will be headed to court. Is this Trump approach going in a different direction because of some animus towards a particular media company, whoever it may be? This breaking news is obviously a lot to -- a lot to unpack and a lot there. Gerry Smith and Matt Miller, thank you both for your expertise.

Up next, connection between Jared Kushner's newspaper and WikiLeaks. The reporter who broke this story and a top editor who has worked for Kushner exclusively on the THEBEAT. And the Trump administration prosecuting a journalist for actions during the Trump inauguration protest. That's later.

(COMMERCIAL BREAK)

MELBER: When Jared Kushner was just 25 years old, he bought a newspaper in New York City for about $10 million. A friend said the New York Observer was Kushner's graduation present from his father. You can see him handing out copies of the first edition published on his watch. Now that paper is getting tied up in Russia controversy. Foreign Policy reporting the Observer used WikiLeaks hacks during the election saying, Observer published dozens of stories largely celebrating WikiLeaks and the revelations it helped expose. The Observer also became a favorite outlet of Guccifer 2.0, the suspected Russian hacker behind the DNC leak. Now the paper also endorsed Donald Trump who made his view of WikiLeaks clear.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: This WikiLeaks stuff is unbelievable. It tells you the inner heart. You got to read it.

WikiLeaks, I love WikiLeaks.

(END VIDEO CLIP)

MELBER: Foreign Policy reporting Observer writers trumpeted exclusive access to various DNC hack release and solicited the leaks openly. In September 2016 a Clinton aide even retweeted Russian hackers now leaking directly to Kushner's paper. Trump campaign not even being subtle anymore. Now, the media's history is under new scrutiny but some caveats on this story are in order. The Observer had a long history as a contrarian publication in New York and many, many news outlet gorged on leaked material about Hillary Clinton. All of it could look different now that the extent of Russia's operation is known. But for those whose criticism comes down to but her e-mails, critics say that applies to many newsrooms, some critic says that includes this one. With me now is the reporter who broke this story. Jenna McLaughlin from Foreign Policy and a former Editor in Chief of the New York Observer Elizabeth Spiers. Jenna, what do you think you found here?

JENNA MCLAUGHLIN, INTELLIGENCE REPORTER, FOREIGN POLICY: Well, I think in this case it's an instance of just pointing out saying you know, now that Jared Kushner is back in the crosshairs so to say, especially in Congressional investigations, what is there to ask about his connections to the Observer? There's clearly a lot of stories in the Observer concerning WikiLeaks, many of them positive and not all of them were simply just the DNC hacks. There's stories that are positive about Julian Assange about allegations that happened with him besides the DNC hacks.

MELBER: Elizabeth, you worked directly for Jared Kushner, you've joined us on THE BEAT before with that unique experience. How do you view this and do you think this is the kind of thing that Jared Kushner would typically be aware of or maybe this was just going on anyway?

ELIZABETH SPIERS, FORMER EDITOR IN CHIEF, NEW YORK OBSERVER: Yes, I think there are a couple of possibilities. I think it's important context for people to understand that the editor in chief of the Observer at the time, Ken Kurson is a close family friend of the Kushners and is a former Republican operative. You know, I think that plays into the story a little bit. This is also not the first time that Kurson has hired a freelancer who parroted talking points that were coming from the Russians. There was another freelancer named (INAUDIBLE) who wrote over 12 articles for the Observer that spouted Kremlin talking points. In both cases, Kurson says that the paper isn't to blame, he isn't to blame because these are freelancers. As somebody who has been editor of paper, I find that preposterous.

MELBER: So you don't buy that. And let me read Jenna from this editor's defense as well. He told you for the -- for your story. I've never communicated in any way with Julian Assange and this sort of fact-free evidenceless charge as analogous to Pizzagate and other totally ludicrous conspiracies. He's basically saying that just because you and your reporting found that there was this material being used, idea this was all a higher level plot or plan is itself a conspiracy. I want your response.

MCLAUGHLIN: Absolutely. And I mean, the kind of quote referencing Pizzagate just turns it back into your face and is meant to be provocative. But it does go against the reporting and it is true that just because someone's a freelancer, doesn't mean you didn't solicit a clip like that and it doesn't mean that you don't talk to Jared Kushner every single day.

MELBER: Elizabeth, when you look more widely at Jared Kushner here. He seems to have at least a disclosure problem by which I mean that there are rules, and some of them are backed by federal laws about what you have to provide when you get your security clearance or when you go meet with Congress. And the fact that he's making disclosure mistakes -- because you know, we always are fair here -- doesn't mean there's an underlying conspiracy or problem, right? It doesn't prove that in the sense of a court of law. And yet, as just came up with the missing e-mails according to bipartisan feedback he got from investigators, the view was that he was not forking over stuff on WikiLeaks contact which comes after he did not fork over material about these Russia meetings. Your view of all this knowing him.

SPIERS: Yes, look, I mean, I think you have to go with Occam's Razor here. If it were one of two moments of forgetting things that would be one thing but he failed to make multiple disclosures. This seems to be a recurring problem and part of a pattern. And so you have to ask yourself, you know, do we have a 36-year-old with a serious memory problem or is there a simpler explanation?

MELBER: Is there Jenna, before we go?

MCLAUGHLIN: It sure seems like if it's a memory problem then there's a lot of memory problems going on. It's entirely possible that he could be just kind of trying to say that it's something that it's not and just keep trying to explain anyway something that he wanting to hide.

MELBER: All right. Well, there is always space between the benefit of the doubt and reasonable doubt. I appreciate you both walking us through some of the evidence. Jenna and Elizabeth, thank you.

MCLAUGHLIN: Thank you.

SPIERS: Thank you.

MELBER: Coming up, Donald Trump's D.C. hotels back in the spotlight and not a for a good reason. Serious questions about fundraisers being used to attract new donors. And former Senator Russ Feingold joins me on that and a lot more straight ahead.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

TRUMP: -- exception of 1600 Pennsylvania Avenue, this is the most coveted piece of real estate in Washington, D.C., the best location.

(END VIDEO CLIP)

MELBER: That was such a weird moment. You can look back on it now and remember Donald Trump, a week before the election, touting his own hotel, stopping during the busy campaign home stretch and talking about how was the best thing next to the White House. Now that hotel tonight with Donald Trump as President has a new flashpoint. Critics alleging a major conflict of interest, it's a way for a foreign government as well as lobbyists to ostensively get into Donald Trump's good graces. They can put money into property that ultimately goes to him. And the National Republican Congressional Committee is now -- get this -- holding a lottery for donors to win a trip to that hotel.

This is similar to a deal you may have heard about with Republican attorneys general who went Mar-a-Largo. Big donors over a hundred thousand dollars (INAUDIBLE) got to attend a dinner there at Trump's resort and they got to be in close quarters with top law enforcement officials. Now, this entire issue is one our next guest, former Senator Russ Feingold has been warning about and leading on for years. Feingold at one point was synonymous with campaign finance reform, McCain-Feingold as he sounded the alarm on an issue the White House is clearly struggling with today.

(BEGIN AUDIO CLIP)

RUSS FEINGOLD, FORMER UNITED STATES SENATOR: When Congress debates the issues that affect your lives, you have every reason to wonder if campaign money plays a role in the decisions we make. Wealthy interests have too much power in our political system. The influence of money in politics is too strong and we understand that the system has to change.

(END VIDEO CLIP)

MELBER: Former Wisconsin Senator Russ Feingold, co-author of McCain- Feingold is here. When you look at these issues today, do you see them as issues of law, because the Supreme Court has obviously made it harder to deal with corruption, or do you see these as uniquely issues of people because we've never had a President choose to run a business while President and basically flout any notion of traditions around nepotism and conflict of interest and all of this stuff?

FEINGOLD: Well, Ari, thank you very much. So I see it as a matter of law, I see it as a matter of morality, I see it as a matter of national pride. You know, the building he's turned into this hotel, which is for sale now basically to the highest bidder is a great old post office building. It's part of the landscape here in Washington near the mall. And it turns it into this kind of a shameful thing where special interests can buy access so close to the capital and apparently the National Republican Party is happy to participate in it. This is really against the traditions of clean government that we need to return to in this country and that we're far away from under the Trump administration.

MELBER: Do you think Donald Trump doesn't get or he just think that these rules don't apply to him. He famously said in January 11th and I'll play this to you that you know, he could run everything at the same time, no problem. Take a listen.

(BEGIN VIDEO CLIP)

TRUMP: I could actually run my business -- I could actually run my business and run government at the same time. I don't like the way that looks but I would be able to do that if I wanted to.

(END VIDEO CLIP)

MELBER: Your view?

FEINGOLD: My view is he doesn't care about the ethics, he doesn't care about the law. His lesson, unfortunately, is because he became president is that he can get away with whatever he wants to do. And so if he wants to sell access like this a few blocks from the U.S. capital, he figures why not. Somehow there has to be accountability here.

MELBER: When you say access --

FEINGOLD: Somehow the American people have to stand up and say we don't want a president who is so obviously corrupt.

MELBER: Senator, when you say sell access, your view is that that's a deliberate part of the business strategy at the D.C. hotel?

FEINGOLD: Well, it may well be deliberate and I'll tell you. The message to foreign countries and foreign interest and foreign businesses is don't work through our government and our laws and our system, you can get there another way. Go down to Florida, or go down to the Post Office building here that's now the Trump Hotel. It's an easier and frankly, it undercuts our national security because it tells people that our government really isn't on the level under Donald Trump. Our government is for sale under Donald Trump and he's happy to make as much money as he can and doesn't seem to care whether or not some illicit interests get special access that the rest of us, of course, would love to have.

MELBER: The other big story on corruption in this past week was the mistrial in your former colleague Bob Menendez you know, in New Jersey. And there was a lot of evidence of gifts. The question was whether gifts under the narrow supreme court standard are enough. Do you have a view of that? do you see that as something that was close to the line? Obviously, I know as you do that we have a tradition of respecting the outcome here and it was a mistrial, but separate from the verdict, was it problematic as the author of McCain-Feingold to see a democrat there taking so many gifts?

FEINGOLD: Well, you know, John McCain and I first worked on banning gifts for members of Congress. That was our first initiative that passed back in the mid-'90s, and we also did campaign finance reforms. So what you've identified here are two of the things that are really are cancers on the system. Gifts to members of Congress that can be personal in nature, or that are of course illegal but still may occur, and then also unlimited campaign contributions. This is why we have to put the genie back in the bottle and do something about these super PACs that are destroying the system.

MELBER: But on the question, was that -- was that bad judgment by Senator Menendez's part?

FEINGOLD: I think he'd be the first to say it's probably bad judgment, but I'll let the courts decide whether or not it's something beyond that.

MELBER: Senator Russ Feingold. You've been a leader on this for a long time, and there's a lot of talk about the swamp so I appreciate you joining us tonight.

FEINGOLD: Great to see you, Ari.

MELBER: There is also breaking news I want to bring you an update on. Charlie Rose has been accused of sexual misconduct. A Washington Post report breaking tonight that eight women have come forward and they accused the news anchor of unwanted sexual advance. One of his assistants recalled, "at least a dozen incidents where Rose walked nude in front of her while she worked out in one of his homes. Three accusers are on the record on this story, another five were anonymous.

The allegations include him allegedly walking around naked, groping, lewd calls that Rose released as well. Now, here is a statement that I want to read to you from Charlie Rose new tonight. He says, "I deeply apologize for my inappropriate behavior. I'm greatly embarrassed, I behaved insensitively at times and I accept responsibility for that, though I do not believe that all of these allegations are accurate." CBS News has suspended Rose and PBS announced It's halting production and distribution of the show Charlie Rose. That is a brand-new story that we wanted to give you an update on and we will continue to update here on MSNBC as the news warrants.

Now there is another story that is very important. Do you remember when Donald Trump told Jim Comey allegedly he wanted to jail journalists? Well, there is one facing a trial this year for many decades in prison, and you need to see why. That's next.

(COMMERCIAL BREAK)

MELBER: Now to an important story that has been flying below the radar. Critics alleging the Trump administration, looking a little bit more like an authoritarian regime. There is the threats that the Department of Justice go after political enemies, there is the report from Jim Comey that the President asked him to try to jail reporters, and now this trial starting this week. Alexei Wood, a U.S. photojournalist may be facing just that. He's facing up to 60 years in prison. And it all started with him covering Trump's inauguration day protest.

(BEGIN VIDEO CLIP)

ALEXEI WOOD, PHOTOJOURNALIST: So howdy, folks. We got ourselves three blocks of black block. All right, it's happening time you all. He was pretty aggressive there. He was pretty aggressive. You're pretty aggressive, buddy.

UNIDENTIFIED MALE: Why are we fighting each other?

WOOD: (BLEEP) off. (BLEEP) off. (BLEEP) you. We have some graffiti.

CROWD: Five, four, three, two, one!

(END VIDEO CLIP)

MELBER: What did you just see? Well, that's what a court is going to figure out. What is now charged with being part of a riot, rioting conspiracy and property destruction? Now he insists he did nothing illegal. But the prosecutors are arguing he effectively ceased being a journalist and became part of the protest there that he was going to cover. But does, that even that argument justify these many felony counts? He may not be a journalist or he may, that may affect what he did, but he is also an American with constitutional rights covering an event with his video camera.

And the larger question posed here is whether the norms are starting to decay under Trump and are they starting with people who are easier to target, not necessarily starting with the most famous journalists on the block. That's a question that is explored in a new important piece by HuffPost Justice Reporter Ryan Reilly. In fact, he wrote his piece in the motif of covering another country cracking down on the press. Ryan Reilly is a Senior Justice Reporter for HuffPost and he is here now. Tell me about this story that may be new to a lot of viewers, but you say is bigger than what everyone thinks of this particular video journalist.

RYAN REILLY, SENIOR JUSTICE REPORTER, HUFFPOST: Right. I mean, to start off with, I think you know, what you saw in that video was conduct that you know, I certainly wouldn't engage and a lot of journalists wouldn't engage in. And I think that you know, from what Mr. Wood has told me, he sort of you know, has had second thoughts about how he engaged that sort of language that he used. But there's an important sort of underlying principle here and it's sort of -- sort of scary when you have a situation where someone who is acting in a capacity as a journalist.

He was trying -- saying he was trying to document the situation is arrested and you know, this isn't a misdemeanor situation where we've seen those sort of cases before. This is -- these are serious felony charges that could result in a very lengthy stretch in prison. And a lot of press advocates out there are worried about it, and worried about the larger cases too not only because of his case, but the other five defendants that are on trial here who also say they didn't actually engage in any destructive activity, but were simply you know, at this sort of wrong place at the wrong time when they were grabbed up by D.C. police officers who formed --

MELBER: Right. And the traditional concern is that a blurry line can be abused by the government. This was an issue certainly in the civil rights era about what constituted, "conspiracy to riot." Is there any physical act that you think is at the core of this or is a lot of this about the things he said in the rally?

REILLY: There's really nothing physical that is a question here. You know, we -- I attended opening statements in the trial today and the government really is focusing on a couple of the moments sort of where you highlighted in the video where he essentially express what you might deem his support saying woo and talking about graffiti. Those are the sort of things that prosecutors are really going to center in on. The interesting thing here is that you know, the government wouldn't be in possession of any of that evidence. It wasn't as though officers you know, singled him out and said oh, he's individually offering up support for the protesters who are destroying things.

They only have that evidence because he live-streamed the whole thing. So they're sort of using this live stream and his own words against him. You know, while these are certainly words that professional journalists might not be using when they're covering something, that doesn't -- that blurry line there doesn't mean that these are anything that you know, would -- these are still activities that you would think would be protected by the first amendment. And a lot of people are worried about those conspiracy charges being used so aggressively in this case.

MELBER: Right. That's why it could be such an important precedent and there can be a ton of stuff on the video that is objectionable. That doesn't mean that it should necessarily give you hard jail time if it was primarily words. I know a trial is going to look into this. Ryan Reilly, thank you for your reporting, I'm putting this on the map. I'll be back here tomorrow night, 6:00 p.m. Eastern but HARDBALL with Chris Matthews starts right now.

CHRIS MATTHEW, MSNBC HOST: The victim speaks. Let's play HARDBALL.

END

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