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Giuliani under criminal investigation. TRANSCRIPT: 10/14/19, The Beat w/ Ari Melber.

Guests: Berit Berger, John Flannery, Neal Katyal, Francis Ford Coppola

KATY TUR, MSNBC HOST: That will do for me this evening. Chuck will be back tomorrow with more MEET THE PRESS DAILY.

"THE BEAT" with Ari Melber starts right now.

Ari Melber, that`s the first one of those I have done in a while, very fun.

ARI MELBER, MSNBC HOST: What do you call those?

TUR: We call them "In case you missed it."

MELBER: And what`s the inspiration?

TUR: Fraud guarantee and mafia rave, as we just illustrated.

MELBER: Have you considered introducing a laugh track? Or you consider the silence after each punch line?

TUR: No, because the laugh is my own. And I think that enough of a laugh track. It`s 6 o`clock and 17 seconds, and I know your EP is yelling at you to get on with the news.

MELBER: Well Katy Tur, we always love seeing you in the toss and a special thank you for joining us for your first "Fallback Friday".

TUR: It was a great time.

MELBER: It was fun. And you and Rakim were great together.

TUR: We had a - I had a blast. Invite me back. Well, you`re invited back. All right, Katy Tur, thank you very much.

Welcome to THE BEAT tonight we are tracking several major developments in this impeachment probe right now.

So as we begin this broadcast on this Monday evening, I want to tell you just a few bombs that have dropped since we were last on the air just, of course on Friday night.

First, "The New York Times" bombshell the Trump lawyer Rudy Giuliani is under criminal investigation; Second, President Trump taking in that potentially grave development and doubling down by embracing Giuliani at a lunch meeting this weekend.

Third, the acting Department of Homeland Security Secretary is now out, another casualty of Trump`s temporary approach to staffing; Fourth, and this one arrives today on Capitol Hill, a huge crack in Donald Trump`s attempt to stonewall this impeachment probe.

Take a look at this scene today.

(VIDEO PLAYING) Fiona Hill, the first white house aide to actually testify in this impeachment probe. There she was arriving. And she is not just any aide, of course. She has been at the center of Donald Trump`s twin foreign scandals from Russia to Ukraine. She left her post in July right before Trump`s infamous Ukraine phone call and today testified to lawmakers for hours in this setting behind closed doors.

Now, before we know everything she said, we do know that she joins this chorus of public servants who are now very clearly rejecting Donald Trump`s demand that everyone defy Congress.

Faced with a subpoena from the Democratic impeachment investigators, she has complied and reportedly detailed how Giuliani - again, now under criminal investigation, was part of a plot to run a quote "Shadow Diplomacy," which among other things, was trying to kneecap Trump`s rivals. These are part of the elements of the alleged abuse of power at the heart of this impeachment probe. So that`s new testimony on that, and that`s one insider speaking today.

Now, then by this Thursday Congress will hear from another insider speaking out. This one is at the center of the Ukraine plot. The EU Ambassador who sent the now-famous text message with Donald Trump`s emerging line of defense that whatever they were asking for and however unsavory it looked, and however panicked the text messages were about it, there was no "quid pro quo" in the Biden plot.

Now, he`s talking, and the reports are, he`ll explained that the text that he wrote there was a response to Trump`s directive in a phone call and that while he dutifully typed it out, he`s not apparently going to claim that he knew it to even be true. No knowledge of whether the President was telling the truth according to those reports.

Well, that`s a big deal. So here`s why this all matters and why this week may prove so critical. We`re not even hearing from the whistleblowers right now. We`re not hearing from Trump critics. This testimony, this stuff that sounds incriminating that Congress is gathering in the impeachment probe, this is from diplomats and people who worked for Donald Trump.

They`re laying down the evidence of this Ukraine plot. If there was a better gloss on these actions or a more benign interpretation, well, these would be the people to offer it. And, apparently, they`re just not doing that, which again shows the logic of why Donald Trump`s request was not for these people to come out and talk or tell the truth. It`s important to remember that as all this stuff flies at us.

The requests and then the order and then the stonewalling was all an effort to muzzle these people so this probe wouldn`t get the facts from them. The Ambassador, I mentioned, he`s also reportedly planning to testify he worked with Giuliani to get the Ukrainians to publicly commit to this same Ukraine plot, including the idea that they would release a special statement about the very Biden linked company that Trump wanted investigated by name.

And that was basically in exchange for a promised White House visit. One source saying "It was a quid pro quo, but not a corrupt one." In bribery - just so we`re all clear, the quid pro quo itself when saw by a public official is illegal. So it`s a pretty thin defense to say the illegal thing wasn`t corrupt, it`s almost nonsensical.

Now for his part, the President who has been trying to stop witnesses and prevent the impeachment, has been again claiming that he also somehow actually enjoys the process. Indeed he finds it "Energizing."

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: You know what they said, every one of them, plus many others, there`s no other man that we`ve ever met that could have taken it. It`s true. Maybe I`m a little different up here, I don`t know. But I enjoy it. To me it`s - I`m energized--

(END VIDEO CLIP)

MELBER: He`s energized. Now, we often try to put things in some context and to be fair. As a matter of history, President Trump`s not breaking any ground here with a kind of hard to believe reverse psychology defense. President Johnson, famously and publicly claimed, he didn`t care if he was impeached as well.

Historians ultimately found and documented that he was privately livid about the impeachment probe and it`s challenged his legitimacy, while he disclaimed and he cares in public.

I want to turn now to two former federal prosecutors John Flannery and Berit Berger and the Politics Editor for the Root, Jason Johnson. Good evening everyone.

JOHN FLANNERY, FORMAL FEDERAL PROSECUTOR: Good evening.

JASON JOHNSON, THEROOT.COM POLITICS EDITOR: Good evening, Ari.

MELBER: Berit, let me start with you right here in New York, right near downtown Manhattan where Rudy Giuliani is under investigation from the office he used to lead. And you look at that as a side pressure on top of what`s coming out of Congress today. What does that do and where does this all lead as a probe?

BERIT BERGER, FORMER FEDERAL PROSECUTOR: Yes. I mean, the fact that there is both a criminal investigation at the same time that we are having these impeachment proceedings is significant for a few key reasons.

Number one, the criminal investigation is going to come with a certain amount of power. While the administration and people in it may be able to disregard congressional subpoenas, it`s a lot harder to do that when there`s the threat of contempt of court, that`s at issue. So when you`re facing--

MELBER: Also known as jail.

BERGER: Exactly. When you`re facing the back end of a jail cell it`s a lot harder to say I`m not going to show up. So I think we may see a lot more willing cooperation - at least with the criminal negation. Although, it is encouraging that we have seen witnesses coming forward to Congress and being willing to come in voluntarily.

MELBER: Yes. And Flannery, all of this comes back to what the Congress decides they think the evidence shows that Donald Trump did.

FLANNERY: Right.

MELBER: Does it meet a high crime, does it meet bribery, does it meet something that they`re required if they take this seriously to assess in the Constitution, which as we all know, is totally different from how you feel about Donald Trump, or whether you think he`s the worst President ever or any other such criticism.

Now, I want to turn to someone who has a unique perspective as a former special type of prosecutor in this. You know who doesn`t think there`s an impeachable offense here is Ken Starr, John.

FLANNERY: That doesn`t surprise me.

MELBER: Doesn`t surprise you.

FLANNERY: --and then legal, yes.

MELBER: Well, here you go, take a look.

(BEGIN VIDEO CLIP)

KEN STARR, FORMER UNITED STATES SOLICITOR GENERAL: I don`t think that there`s anything close to an impeachable offense here by traditional standards, including during the Clinton years when the President of United States clearly - Bill Clinton, clearly committed crimes - federal crimes. First of all, it`s doomed to fail.

UNIDENTIFIED MALE: In the Senate it`s doomed to fail.

STARR: It`s doomed to in the Senate, yes.

(END VIDEO CLIP)

MELBER: John?

FLANNERY: Well, you know, these guys are in denial about anything that`s true and obvious. I mean, if a sex act and a lie about it is an impeachable offense, what is not an impeachable offense.

So the truth is the converse, which is that, that was not an impeachable offense. It wasn`t a high crime a misdemeanor. It wasn`t good, it was bad and there should have been - there are ways to handle that.

But this is an impeachable offense. It`s a violation of Campaign Finance Act, it`s a violation of the emoluments clause, it`s a bribe, it`s an extortion. There`s an abuse of power here.

And Sondland comes forward and says, oh you know I talked to the President. He said there was no quid pro quo. Sondland himself was working on this project forever. We have him on text messages. I can`t even believe he`s coming to testify with that background of evidence.

MELBER: If there was a quid pro quo does it make it worse, better or not matter if public officials at the President`s direction were claiming the opposite?

FLANNERY: Well, people when cornered claim innocence and that they didn`t do it. But we have his actual words during the event and text messages and other people he`d spoken to, including Bolton by the way. When in early July he proposed that this was something they should do and Bolton after the meeting went crazy and that`s before the July 18th hold back of the funds to Ukraine.

So I can`t even believe he`s coming to testify. If I was his criminal defense lawyer, I`d suggest that you take a powder under the fifth, but that`s--

MELBER: Well that`s striking.

FLANNERY: --politicians don`t do that. And the arrogance of these guys is astonishing, because I think they believe Barr is never going to prosecute me. And this guy Trump, who is enjoying being impeached, so he says, although--

MELBER: Energized--

FLANNERY: --there - yes, he`s energized.

MELBER: That`s like a Red Bull.

FLANNERY: Yes, he is a sick dude is what he really is. Yes, maybe he had too much Red Bull. He`s going to pardon them all, that`s what they believe. And everybody should know by now, this guy is loyalty to only one person, ask Rudy Giuliani. Last Friday throws him under the bus and over the weekend he sidles up to him again saying he`s my lawyer.

MELBER: Let me - as I bring Jason, let me get in two points over. I`m not stipulating whether or not the President, as you put it, as "Sick Dude." Although, I am fact-checking the--

FLANNERY: Under the 25th Amendment, perhaps.

MELBER: But I am fact-checking that he has contradicted himself numerous times on matters both large and small in this issue.

But number two, Jason, when you look at this writ large it`s easy to lose track of the fact that the White House set out a strategy here and it was to deny evidentiary oxygen to Congress. If the people don`t comply, if the witnesses don`t show up, if they don`t turn anything over, then won`t Congress look potentially to some people like they`re reaching, to rush to a conclusion in something that is - although it`s not a traditional trial, is supposed to deal with evidence and facts.

And I would note for your analysis, Jason that is failing before our eyes. The people are speaking, former officials who have a little more leeway, but also current officials. And for your review Jason, your thoughts on what I`m about to show, which is the Pentagon also rejecting Donald Trump`s stonewalling strategy. New sound, take a look.

(BEGIN VIDEO CLIP)

MARGARET BRENNAN, CBS NEWS SENIOR FOREIGN AFFAIRS CORRESPONDENT: are you going to comply with the subpoena that the House provided you and provide documents to them regarding to the halt to military aid to Ukraine?

MARK ESPER, UNITED STATES SECRETARY OF DEFENSE: Yes, we will do everything we can to cooperate with the Congress.

BRENNAN: Is that a yes?

ESPER: That`s yes.

BRENNAN: You will comply with the subpoena?

ESPER: We will do everything we can to comply.

BRENNAN: OK.

(END VIDEO CLIP)

MELBER: Jason?

JOHNSON: Yes. Because no one`s trying to go to jail for this guy. Right? And regardless of what the loyalist to Donald Trump may say, we have to recognize this in the grander scheme of things. Number one, we have the political and the impeachment element, which is all of this was done in order for him to have a material impact under 2020 election. So that`s where the impeachment comes in.

But the rest of this is the sort of stonewalling of Congress and the hiding of information every, single person involved, these are career civil servants are thinking to themselves I don`t want to face jail time. I don`t want to face criminal charges. You`ve seen Cohen go to jail, you`ve seen Manafort go to jail and those are people who had millions of dollars of lawyers and experts working on their behalf.

These regular civil servants are not trying to take that kind of heat. And so the President is realizing now the limits of his influence. It`s not just that he hasn`t shown himself to be a loyal patron to anyone who works for him.

But he realizes that his corruption has trickled so far down that regular people who go to work every single day and come home that Chevy Chase in other parts of DC, are like look, I need to have a life beyond this administration and I`m not going to carry water for this level of corruption.

MELBER: John?

FLANNERY: Well, you know I was thinking, while he was saying, that it`s not just a deterrent that they`re afraid to go to jail, we have people with real ethical character - Yovanovitch, we have witnesses talking about what is wrong here. And what it says is that the character of America is resisting this thug in the White House.

They might just as well call themselves some middle-class gang, you know, I don`t know, maybe the Jets, so that these guys are just bad at the core. And what`s happening is we`re shedding the best people who are coming out and starting the talk. We`re beginning to have a critical mass of witnesses against these crimes.

And unlike what the Special Counsel had to do, the treks are still recent. The biggest problem with that investigation with so much time has passed, this is now and it`s very hard for people to cover-up what`s going on, because we can get them now with people who are prepared to talk about it.

MELBER: You said maybe the Jets?

FLANNERY: Yes.

MELBER: Is that what you said?

FLANNERY: Yes, I think, I said that.

MELBER: Because you know when you`re a Jet, you know, you`re a jet all the way, John.

FLANNERY: Right. Yes, I know that. And they`re Jets all the way. They couldn`t call them the Genovese crime family, though, it`s closer to that than the Jets--

(CROSSTALK)

MELBER: Well, all this crime family talk, you`re going to pull it a promotion out of me, which is the Francis Ford Coppola is on THE BEAT later tonight, so--

BERGER: Oh is it? Well--

MELBER: We`ll get to those metaphors. But, Jason, walk us through the Congressional part of this. There`s the legal part, there`s the lawyers, there`s the testimony. The Congressional part appears to that this Intelligence Committee, backed finally with the full force of the Speaker, which was a change. Right?

We`re looking at - what is the difference between Speaker Pelosi saying what she said. She`s a big critic of Donald Trump. She does believe she said that he had violated the oath, but she wasn`t ready to go to impeachment. And now last few weeks, the combination of whistleblowers and her putting the full force of her power as Speaker, boy it does look like night and day, doesn`t it Jason?

JOHNSON: It does, it does. And this is what. Ari, I have critiqued Nancy Pelosi for a long time.

MELBER: On this program, yes.

JOHNSON: Part of the reason that it took this long was because she had pretty much thrown water on the whole thing and said I`m not ready for this. But now, because of the President`s own behavior, he`s done something that is so bad and so obvious that many members of Congress are like, OK, that`s fine. I can vote for this.

So here`s what we`re going to see over the next couple of weeks. You`re going to have these committee testimonies sometimes behind closed doors, sometimes in public. And each of these committees is going to basically put through their own articles of impeachment. They`ll get together in a room and decide which ones are going to be voted on by the House as a whole.

I think what`s critical about this, is that this is also something regular people can understand. This testimony by Sondland is going to happen on Thursday. The President told me to say that there is no quid pro quo.

One, this is very similar to when the President dictated what happened in the Trump Tower meeting. But also, who believes that when you say it`s not a quid pro quo? Did he put a smiley emoji and JK at the end? Everybody knows it was a quid pro quo.

So these are the kinds of things that members of Congress - even those who are nervous, have gone home for the holiday recess and said, "Hey, you know what, this is still working with the American people."

MELBER: Well, you`re also illustrating, Jason, a very important point, which all of our panelists may know which is under the Hobbs Act if you make a direct attempt to have an official bribed there`s no backsies.

JOHNSON: Exactly.

MELBER: What I`m going to do is fit in a break. John and Jason, thank you so much.

FLANNERY: Yes, sir.

MELBER: Berit given your service at SDNY stay with me, I want to get into that.

Coming up next, I`m giving you my special report on what I think it means to see Rudy Giuliani go from prosecutor to potential suspect, and how it could affect Donald Trump`s entire impeachment legal defense.

Later tonight, Neal Katyal is here on why Trump could lose the subpoena war. And, yes, as mentioned, we are thrilled to have the one and only Francis Ford Coppola tonight on THE BEAT and I`m obviously going to get into why the Godfather Part II has figured in to Roger Stone`s trial. All that up ahead.

I`m Ari Melber, you are watching THE BEAT on MSNBC.

(COMMERCIAL BREAK)

MELBER: Now to another top story, Rudy Giuliani is under criminal investigation by the prosecution office they used to be run by Rudy Giuliani. It is a striking development. A story "The New York Times" broke late Friday night heading into the weekend.

(BEGIN VIDEO CLIP)

BRIAN WILLIAMS, MSNBC HOST: Yet again we have breaking news tonight, yet again it pertains to the President`s lawyer and all-around sidekick, Rudy Giuliani. Tonight "The New York Times" is reporting Rudy is under investigation by federal prosecutors in the Southern District of New York, in effect, the Justice Department of Manhattan office where he himself once served as U.S. Attorney.

(END VIDEO CLIP)

MELBER: The prosecutors in the Southern District are notoriously tough and independent, which Giuliani knows, because of course, as mentioned. He`s one of the most famous alumni. He ran the office, stressing he would go after Wall Street and organized crime alike.

(BEGIN VIDEO CLIP)

RUDY GIULIANI, FORMER MAYOR OF NEW YORK CITY: --that you violate the law, whether it`s insider trading or tax evasion, or fraud, or bribery. The overwhelming general rule is that you to prison.

This cases charges more mafia bosses in one indictment than any ever before.

Let me tell you that I know about the crime that you have to deal with. I understand the fear that you.

The mayor isn`t a tough mayor on crime that mayor opposes the death penalty.

(END VIDEO CLIP)

MELBER: So how did Giuliani go from prosecutor to potential suspect today? Well, the first part of the answer is he has done a lot in between these two phases of his life. Giuliani hasn`t stepped into a courtroom in 30 years, but remains associated with that career because he invoked law and order to become a politician.

He spent the better part of the last three decades dabbling in electoral activities and business adjacent to politics. Giuliani served as Mayor, of course, he also went on to try to elevate into national politics, including a string of dramatic convention speeches, pushing everything from George Bush to Sarah Palin.

(BEGIN VIDEO CLIP)

GIULIANI: Here in 2001 in the same Lower Manhattan, that President George W. Bush stood amid the fallen towers of the World Trade Center, and he said to the barbaric terrorists who attacked us, "They will hear from us."

I`m sorry that Barack Obama feels that her hometown isn`t cosmopolitan enough. I`m sorry--

(END VIDEO CLIP)

MELBER: Now by 2008, Giuliani could picture himself in the oval office, running for the GOP presidential nomination, based main ply on his record as Mayor, an unlikely profile for the Republican primary.

(BEGIN VIDEO CLIP)

GIULIANI: I`m running for President of the United States, because I believe that this country needs strong, bold leadership.

This is going to be a very different type of campaign. New technology gives one person the power to make a difference on a scale we could hardly imagine 20 or 30 years ago. That`s why I hope you`ll be coming back to our website.

(END VIDEO CLIP)

MELBER: But they didn`t come back. Giuliani struggled to win over Republicans. He ran on moderate immigration policies. Remember this, similar to what Obama would ultimately back.

(BEGIN VIDEO CLIP)

GIULIANI: Since you can`t throw out all 12 million people, whether Governor Romney would like to do that or not or anybody else, but you just can`t do it. It`s not physically possible to do. I would focus on the illegal immigrants that are here who have committed crimes. They should be given priority--

(END VIDEO CLIP)

MELBER: What an idea. It didn`t work. Giuliani didn`t win a single state or actually we checked a single delegate. To put that in perspective, one of the most famous names in the race who had high polling for that fame initially, finished with fewer delegates than Alan Keyes or Fred Thompson or Ron Paul. But Giuliani kept up the hunt.

If he wasn`t going to be President, he was eager to build inroads the next Republican President whoever it might be. In the heat of the 2016 primary, he was still hedging his bets on frontrunner Trump, telling "The New York Times", "I don`t consider myself an advisor. I`ve talked to Donald for 25 years." So I talked to him a lot, "Anyway, I`m not sure who I`m going to endorse."

And then when New York`s primary hit Giuliani was still playing coy. He said, he would vote for Trump because "he was better than Cruz and more realistic than Kasich." But stressed it wasn`t actually a quote "endorsement" and he disagreed with Trump`s personal attacks on Senator Cruz`s wife.

But soon, Trump would get that Giuliani endorsement and embrace. But remember this was back when Republicans like Cruz were still holding back.

(BEGIN VIDEO CLIP)

GIULIANI: Washington needs a complete turnaround and Donald Trump is the agent of change and he will be the leader of the change we need--

(END VIDEO CLIP)

MELBER: And when Trump won, Giuliani jump right into this role he`s now totally famous for. A Trump surrogate whose defenses are so bumbling, so illogical they often sound more like confessions.

And that didn`t start with Ukraine or Russia, remember Giuliani jumped right into one of Trump`s very first controversy in his first month in office, the travel ban.

(BEGIN VIDEO CLIP)

GIULIANI: When he first announced it, he said Muslim ban. He called me up, he said put a commission together, show me the right way to do it legally. And what we did was, we focused on, instead of religion, danger.

(END VIDEO CLIP)

MELBER: That would haunt them Giuliani says. Now he stayed out of the administration after that, but in the mix. We all remember it, and I`m not going to play the clips of him dishing on Stormy Daniels, the Russia probe, Ukraine.

But this Ukraine story has upended Giuliani and his client unlike any other issue. Two Giuliani business associates indicted just last week. And it`s not the first time, this is important, someone close to Giuliani has been indicted for actions in this murky gray area between politicking and business, and yes, alleged corruption.

Giuliani`s firm used to be called Giuliani Kerik, named after the police commissioner he appointed. They changed the name after Kerik was indicted several times and convicted on tax fraud and lying to federal officials.

Another longtime business partner just left Giuliani`s current company, saying it has nothing to do, however, with this scandal. And Giuliani admits he was pushing for a Biden probe in Ukraine, the very thing the House may impeach on.

But after this story just broke Friday about him being under criminal investigation, he tells "The New York Times", whatever he did he did because he was quote "Representing the President" and therefore shouldn`t be prosecuted under these foreign lobbying laws.

First, that sure sounds like the President`s lawyer throwing him under the bus. Second, the President does have something of a get-out-of-jail-free card when it comes to prosecutions while he`s in office. We`ve all been talking about that. But it is not transferable to his lawyer.

And Giuliani has long sought proximity to the White House and in Trump after this hesitation period, looks like he found someone who viewed Giuliani`s alleged shortcomings more like assets, perhaps because they have a few things in common.

Think about this, the blatant mixing of government and business right up to the line of indictment when it comes to his associates, public advocacy performed through televised spectacle, and all this talk of being tough on crime, but only for other people. And that`s why the record Giuliani has been invoking for his rise rings so hollow to so many today.

(BEGIN VIDEO CLIP)

GIULIANI: It`s not enough for our leaders to follow the law. They must set an example for others to follow.

(END VIDEO CLIP)

MELBER: When I`m back in 30 seconds, we have the perfect guest for this, Michael Steele and Berit Berger.

(COMMERCIAL BREAK)

MELBER: The weekend news is Rudy Giuliani under criminal investigation which didn`t stop President Trump from embracing him in a lunch meeting this weekend. As promised to dig into Giuliani`s evolution, I`m joined by a federal prosecutor who served in the same New York office Berit Berger; and the one and only Michael Steele who took over running the RNC, the year after Giuliani`s Presidential run. Let`s pull that out, I think we`ll go full. There we go.

MICHAEL STEELE, FORMER RNC CHAIR: There we go.

MELBER: There you are together.

STEELE: Ah, the good old days.

MELBER: And his cross paths with him many times in Republican politics. There you are.

STEELE: Yes, yes. The Rudy then then the Rudy now are two very, very different people. I think when you look - that was actually was a very, very well done walkthrough of the journey of Rudy in that.

He`s a guy who has always been the source of a lot of the energy and the excitement and the politics, and certainly the business of what he used to do. So when he was a prosecutor, when he was Mayor, he was that the center of the flame and now he`s not.

And I think some of what you`re seeing is trying to be relevant and be in space. I mean, he says he`s the President`s lawyer. Really? I mean, what legal advice is he giving the President. If he`s giving the President legal advice that`s going to be - that opens up a whole different can of worms.

MELBER: Well, Michael, in fairness, I think, one of his tips is do all your deposition prep on live TV.

STEELE: That`s - yes, we`ve seen that, haven`t we? Yes, I think you`re right, Ari. But you know as counsel that that`s not the smartest way to do it and it certainly doesn`t serve your client`s interest to do it that way.

So this is not so much about Rudy being the legal savant as it is being in Trump`s ear, because of their 30-plus year relationship, being close to power, the center of power, because that`s a space where he`s always wanted to be.

And now he`s sitting out here throwing various people under the bus, but the focus is back on him but not in a good way.

MELBER: Not in a good way. Real talk, Berit, what are the alumni of SDNY saying?

BERGER: Yes, I mean, everyone is to - use the word just flabbergasted by this. I mean, I think it`s the only thing that you knew about the position of U.S. attorney or the Southern District of New York came from the show "Billions", maybe this wouldn`t be so surprising.

But the reality is much more boring than that. I mean, this is a position that is not political, that is not usually filled with people that are showy or pushing the line. This is a position that historically has carried with it a lot of responsibility, integrity, independence, that`s how people talk from the Southern and Eastern District - both districts where I`ve served, that`s how people talk about the U.S. Attorney.

MELBER: When you look at the arc that we just saw. Do you think in part, he has just moved so far from the texture and the obligations of being in that role, because he has really been in politician and in politically adjacent business now for 30 years?

BERGER: Yes, I mean, when people go to work at the U.S. Attorney`s office they don`t usually do it because they have a political agenda. It is because they care about justice, they want to do the work, they want to work on some of the most exciting and challenging cases in the country.

It is surprising to see a former U.S. Attorney wrapped up in such a political scandal and really shocking to see him now being investigated by the same district that he wants used to lead.

MELBER: Because they - that`s such a great point, because that individual - the Rudy Giuliani that was the prosecutor, the Mayor, he knew better. He knew the dangers. He knew what those types of associations meant and would not embrace that personally. And didn`t he know that if you stand with criminal liability for an action, it`s no defense of that action to say I work for the President.

STEELE: Right.

MELBER: Did Michael Cohen not learn that in public?

STEELE: I mean, we have so many examples of it. I mean, you just look throughout history those individuals who`ve gotten themselves caught up in scandal have not been saved because of their association with the President. They`ve actually gotten into deeper trouble because of their association with the President. And I think--

MELBER: Does he have any political beliefs at this point?

STEELE: That`s a good question.

MELBER: I mean, when you were out with him in `08-`09?

STEELE: Yes. No - look, Rudy was one of those guys in the party that a lot of people, despite the truth of how his Presidential bid turned out, still had a lot of gravitas, was considered someone who was important to the philosophy and the ideas that the party spoke about at the time.

Yes, they may not have want to see him as President, but they didn`t necessarily want to see him go away, because he did have something to contribute.

But, today, when he`s espousing Trumpism, the way he`s espoused Trumpism at the expense of the rule of law, at the expense of the constitution, yes, I understand why a lot of the prosecutors in the old office, as they would say, are shaking their heads and going, "Who is this guy?"

MELBER: It`s a tremendous evolution and whether it`s a fall or not remains to be seen. Berit Berger and Michael Steele, thank you for giving us extra depth here on "Beat`s" special coverage, appreciate it.

Up next, more Trump officials talking. Trump says he is going to defy all the subpoenas. What does that even meet mean at this point? We have just the person to unpack it. Neal Katyal live for "Opening Arguments".

(COMMERCIAL BREAK)

MELBER: Breaking news. We`re learning former senior adviser to Secretary of State Pompeo, named Michael McKinley, who resigned last week, will join the ranks, it`s something we`ve been covering all hour, the people testifying this week in the impeachment probe and it is coming fast. He will face House on Wednesday.

Meanwhile, the Trump White House has been trying to keep the whole lid from blowing off, the Ukraine scandal unraveling before our eyes, more and more aides coming forward. The strategy is to stonewall. In fact, in a letter to Congress, the White House says, the entire probe is basically, "baseless, unconstitutional" and thus they see no legal or governmental obligation to participate in it.

Trump`s own administration, though, is divided. Look at these different responses from the budget chief, and as we were mentioning, the defense secretary.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: The OMB has been subpoenaed. Have you responded yet?

RUSSELL VOUGHT, ACTING DIRECTOR OF THE WHITE HOUSE OFFICE OF MANAGEMENT AND BUDGET: No, yesterday`s letter speaks for itself. We will continue to not participate in this process.

ESPER: Yes, we will do everything we can to cooperate with the Congress. Just in the last week or two, my general counsel sent out a note that as we typically do in these situations to ensure documents are retained.

BRENNAN: Is that a yes?

ESPER: That`s yes.

BRENNAN: You will comply with the subpoena?

ESPER: We will do everything we can to comply.

BRENNAN: OK.

(END VIDEO CLIP)

MELBER: I`m joined by former acting Solicitor General Neal Katyal who has faced the Supreme Court dozens of times and is back for "Opening Arguments." Nice to see you. What do you think about what we`re learning here and topped by this breaking news that people really are coming forward, despite everything that I just outlined that the white house is up to?

NEAL KATYAL, FORMER FEDERAL PROSECUTOR: Yes, I mean, the White House is up to, you called it a stonewall its more than that. I mean, it`s like an avalanche wall. It`s just like the complete, utter resistance to getting the truth out, and it started with trying to suppress the whistle-blower report back months ago and has continued.

So that they have said, for example, you know, Ambassador Sondland can`t testify, Fiona Hill can`t testify, former Ambassador Yovanovitch can`t testify, all these people, and now they are defying those refusals to testify. And they`re going in and following the subpoenas and Mr. McKinley is just the latest in that list of people.

And they`re doing - these are public servants, and they`re doing exactly what they`re supposed to do, which is give the truth to the American people and our elected epresentatives in Congress.

MELBER: Yes, I also want to get your views on the really huge development of Rudy Giuliani being under federal investigation. You, obviously, work domain justice, you know how sensitive is when they deal with certain high- profile individuals, certainly with the former prosecutor.

Not that they`re immune, but it`s not something I think they take up lightly. So I`m curious your views given we`ve been covering that tonight and also something that just crossed the wire. So it`s not confirmed by NBC News, but it`s credible reporting from "The Wall Street Journal", and I`m going to read it to you Neal, since I know you haven`t had a chance to prep with it.

But it says, headline - "Federal prosecutors scrutinized Giuliani`s Ukraine business dealings finances" and says that "This is a probe of his dealings with Ukraine." That they`re reviewing quote "Mr. Giuliani`s finances meetings and work for a city Mayor there," which gets into this whole government question of was there a legal foreign representation.

And it says quote, "Investigators have examined Giuliani`s bank records." Again, I`m going to repeat, our coverage, Giuliani has said he`s not aware of the probe and denies any wrongdoing. Your thoughts on all of the above.

KATYAL: Well, Ari, I guess, my real profound reaction here is just one of sadness. I`m not one of these like partisan blood sport people who`s like happy when the other teams` guy goes down or gal goes down.

Rudy Giuliani was a legendary figure at the Justice Department and did so much good for the country in all sorts of ways. And to see this is, I don`t know any other word for it, but sad, really just tragic.

And I think the investigation will unfold. It`s obviously tougher to investigate in many ways in attorney than others. Here he might not have been only acting as an attorney. He might have been acting in other ways. So I suspect this investigation is going to take some time.

But I don`t think should distract from the main question facing the American people right now, which is, did Donald Trump go and seek help from a foreign power to benefit his own campaign? Giuliani is still only a sideshow in that. And what the President is doing is he is trying--

MELBER: Well, is he - let me press you on that, Neal, for us to understand. Is he a sideshow or is he according to the White House call notes, the person outside of government who was being invoked by the President as the agent of this plot?

GIULIANI: Right. I should have said Giuliani`s criminal liability is the side show. Giuliani is a conduit to be sure in part of the story. Though, if I were in the House and impeaching, and looking at impeachment, I wouldn`t need Giuliani. I`ve got the President`s own words in the July 25th phone call and so many other things, including the whistleblower part.

So I don`t think you need Giuliani. But I think what the President is banking on through his stonewall strategy is to try and run out the clock and hope that he can tie this up and say I`m not going to follow the subpoenas. I`m not going to turn over evidence, I`m not going to turn over witnesses.

They wrote a ridiculous - as White House Counsel wrote a ridiculous eight page memo last week, which I call the crayon memo, because I think that`s the depth of the legal arguments they`re saying. They don`t have to turn anything over.

And there was one President who tried that before his name was Richard Nixon, and he went down in flames, and I suspect the same thing will happen here if this President does this.

MELBER: Neal Katyal with a lot of context for us, and I think a reminder. I really appreciate what you said that, while there may be justice or accountability here, we don`t know all the facts. You take know no personal joy in it, which I think is something for us all to reflect on.

I also want to, in addition to thanking Neal, remind everyone. You can go to opening arguments on MSNBC, that`s msnbc.com/opening arguments and see this tonight and all other Neal breakdowns. I find them to be quite elucidating.

Now, as promised, later on this show Director Francis Ford Coppola joins me for the first time on THE BEAT and we`re going to get into the influence of the Godfather, including why it figures in potentially to Roger stones trial.

But first before we get to that, I`ve got news for you one why the clock is ticking Donald Trump`s loss as Democrats closer than ever they say to his tax returns.

(COMMERCIAL BREAK)

MELBER: Turning to another story we haven`t touched on at all and it could be very significant. United States Congress is much closer right now legally to getting President Trump`s tax returns. His accounting firm now has four days to hand them over to Congress, because of this new ruling last week.

The Appeals Court ruled that contrary to Trump`s arguments, the Committee that`s in Congress has the authority under the rules in the Constitution to subpoena the returns. That it is a "legitimate legislative investigation." The court ruling that basically Congress, as a co-equal branch of government, can do this. End of story.

Now tonight there is a new angle here. "The New York Times" reporting another institution, Deutsche Bank, can`t comply with this kind of request if it got it, because they don`t have the tax returns. Apparently they got rid of them.

Reporter David Enrich talked to a former Deutsche Bank executive who actually reviewed Trump`s tax returns, so not just a random source, and said OK, is there a circumstance where the bank wouldn`t hold on to this kind of thing?

Here`s the executives response, "With holy expletive," adding "It could be they returned or destroyed physical copies under an agreement and cleansed servers." And that "Is not normal" according to his source. Quite a set of developments, but the President is closer to having to cough up the returns.

Now let me tell you something else we`re doing that I`m very excited about. The legendary director Francis Ford Coppola is my special first time ever guest on THE BEAT. We`re going to talk Godfather, Roger Stone and a whole lot more.

(COMMERCIAL BREAK)

MELBER: If it feels like the Trump era is out of the movie that is partly because of so many of today`s performers rip off the movies. From a President quoting his idea of tough guy mob talk, to prosecutors who recently took over Bob Mueller`s case against Roger Stone and they are telling a judge they need to play the Godfather Part II at trial to prove Stone`s obstruction.

A reminder of the enduring significance of a classic that earned Best Director for Oscar for Francis Ford Coppola, whose many iconic films shape our ideas about culture, politics, crime, and foreign policy, with so many memorable lines.

(BEGIN VIDEO CLIP)

THE GODFATHER: I`m going to make him an offer he can`t refuse.

KILGORE: I love the smell of napalm in the morning.

(END VIDEO CLIP)

MELBER: Coppola`s stark depictions of violence, moral dilemmas and what today is sometimes called the "struggle", are back in the news for partly political reasons. Vanity Fair noting this new project, "Rights a Wrong" by restoring black scenes and stories to "The Cotton Club." Coppola`s 1984 film about Harlem, which he says, studios resisted for "too many black stories."

Well, the newly remastered release adds some of those stories back into the final cut you can see today, which makes this a special time to sit with a cultural legend, Francis Ford Coppola, Director of The Godfather Trilogy, Apocalypse Now, Patton, Peggy Sue Got Married. And Oscar winner, six times over for directing, screenwriting and producing. It`s an honor to have you here. Thanks for being here.

FRANCIS FORD COPPOLA, FILM DIRECTOR: Thank you.

MELBER: The Cotton Club, why now, what`s different?

COPPOLA: Well, Cotton Club was made under very adverse was made under very adverse, war like conditions. There was a big difference between the producers and the financiers and who had brought me on. I did have final cut all the time. But even when you have this legal final cut, the people who put up the money or are about to release it, you try to collaborate.

MELBER: Pressure. You faced pressure.

COPPOLA: Yes, but you try to collaborate.

MELBER: You try to meet in the middle.

COPPOLA: Yes.

MELBER: Its creative.

COPPOLA: In fact, at one point when they all went to meet my lawyer and he tried to demonstrate in the contract on the table, that I had this final cut right, they said - they knocked the papers off and said, well, now it`s off the table. They were - some of them were a little, tough kind of guys.

MELBER: Tough guys.

COPPOLA: Yes.

MELBER: The kind of guys you might see in a Coppola movie.

COPPOLA: Very definitely. But the message I had gotten repeatedly was the film was too long. There`s too many black people in it and there`s too much tap dancing, which is sort of tricky, because it was about the Cotton Club.

So you start shortening a few minutes and then you take a little more. And you say, "Well, maybe I don`t know if people don`t like that. There`s too many blacks stories, maybe the wanting to be a little less. I thought I was taking a few minutes out, but I ended up taking 40 minutes out.

And then I really wanted to put them back, because I felt the picture - in the film when they say a film is too long it may being that they just don`t understand the story, so to them it seems long, because they don`t know what`s going on.

MELBER: That long just means they don`t get it.

COPPOLA: They don`t get it. So I found that the Cotton Club, when I put the time back in, came alive suddenly and was balanced. And the fact that it was two black brothers and two white brothers and their stories were balanced, who made it really beautiful and intricate.

You have to understand that a movie is an illusion. That when the people are looking at a film on the screen, you`re seeing a lot of shadows. The emotion is in the audience. The audience is what it has. And they - the illusion if it works, they release all that emotion. We found the right balance and suddenly it came to life.

MELBER: I got to ask you about the Bob Mueller prosecutors building his case against Roger Stone that rests partly on the Godfather II, you`ve heard of this?

COPPOLA: I heard of that.

MELBER: What did you think when you first heard that you`ve got people, maybe wannabe gangsters, and they`re literally trying to reenact the congressional obstruction scene. Because this is being litigated, as you know.

I want to read from - these are the prosecutors who took over from Mueller and they say this Godfather clip has to be played in in Roger Stone`s trial because it is dramatic, relevant to some of the facts in the case, a witness in a congressional investigation pressured to give false testimony, which explains Roger Stone`s references to this scene.

COPPOLA: Well, I mean, over the last 20 years, some of the most unattractive political leaders in the world, from Saddam Hussein and Gaddafi and I could go on and on and on, that`s their favorite movie. So there must be something in this piece of fiction.

MELBER: Do you think the prosecutors are right? They should be able to play your film in this case?

COPPOLA: If it`s relevant to the case, and I mean, "Godfather" has become part of the culture - from my point of view anyone who would take a, stuff from a fictional gangster picture and put it in real life, that`s not behavior.

The behavior "The Godfather" is not behavior I recommend. I always thought people who would use intimidation and violence and cruelty are below my lowest regard for another human being. So I don`t recommend that kind of behavior.

MELBER: And why do you think, people as you said, in America and around the world, are so fascinated by that - the story of family, loyalty, but also brutality?

COPPOLA: Because they are interested in the mechanisms of power. "The Godfather" is a kind of textbook of saying one thing, but meaning another. You know, it`s method of how your reputation of what happened in the past. You can be very friendly and very nice about saying what would be the result if you don`t go along with me. But you`re - the past speaks very loudly. So it`s intimidation.

MELBER: Francis Ford Coppola, I really appreciate you coming on THE BEAT, sir.

COPPOLA: Thanks.

MELBER: Interesting times. Before we go, I want to update you on this Rudy Guiliani story as well. What a night, "The Wall Street Journal" is reporting federal prosecutors are not only investigating his business dealings, but that they have started reviewing his finances.

The feds looking at specifically bank records according to this new story crossing the wires this hour. We wanted to get you that update on a story that just doesn`t quit.

A lot going on. That does it for me. I`ll be back here at 6:00 p.m. eastern tomorrow. "HARDBALL" with Chris Matthews is up next.

  THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED. END