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MTP Daily, Transcript 7/5/2017

Guests: Terry McAuliffe, Beth Fouhy, Susan del Percio

Show: MTP DAILY Date: July 5, 2017 Guest: Terry McAuliffe, Beth Fouhy, Susan del Percio

NICOLE WALLACE, MSNBC HOST: I`m Nicole Wallace. MTP Daily starts right now with Katy Tur in for Chuck. Hi, Katy.

KATY TUR, MTP DAILY HOST: Hey there, Nicole. That`s a really good panel you have today. If it is Wednesday President Trump is overseas and so are his biggest troubles. Tonight, North Korea tests a missile with the potential to reach Alaska and Hawaii. What options does the U.S. have to counter this nuclear threat?


NIKKI HALEY, UNITED STATES AMBASSADOR TO THE UNITED NATIONS: The United States is prepared to use the full range of our capabilities to defend ourselves and our allies.


TUR: Plus, where have all of the Republican senators gone?


TUR: How Republicans are dodging health care, fireworks at home over the holiday break. And one of history`s greatest unsolved mysteries.

UNIDENTIFIED MALE: Amelia Earhart on a globe-girdling flight with navigator Fred Noonan, (INAUDIBLE) and was never heard from again.

TUR: Eighty years later, do we know what really happened to Amelia Earhart? This is MTP Daily and it starts right now.

Good evening, I`m Katy Tur in New York. Welcome to MTP Daily. The clock is ticking on the Trump administration after North Korea shocked experts yesterday by testing a missile capable of striking the U.S. Moments ago, President Trump landed in Poland. He begins a crucially important trip abroad where he will engage with two of North Korea`s most important allies. The President will meet with G20 leaders including China. He will also meet one-on-one with Vladimir Putin.

Russia and China put out a joint statement urging diplomatic talks. They are proposing that the U.S. and South Korea freeze all military drills in exchange for North Korea freezing its nuclear test.

This afternoon, the United Nation Security Council which includes the U.S., Russia and China held an emergency meeting on North Korea. The U.S. condemned the regime`s actions, threatened military action against it and also warned of a trade war with North Korea`s allies.


HALEY: Their actions are quickly closing off the possibility of a diplomatic collusion. The United States is prepared to use the full range of our capabilities to defend ourselves and our allies. There are countries that are allowing, even encouraging trade with North Korea in violation of U.N. Security Council resolutions. Such countries would also like to continue their trade arrangements with the United States. That`s not going to happen.


TUR: The meeting comes after U.S. officials confirmed North Korea`s claim that it successfully tested an intercontinental ballistic missile. The two-stage missile was a weapon that the U.S. has never seen Pyongyang use before. A rocket like that is capable of reaching Alaska. It`s also capable of carrying a miniaturized nuclear war head which North Korea is trying to develop.

Experts differ on when such a nuclear weapon would be operational but some think it`s a quickly closing window of less than 18 months. The U.S. and South Korea held a military drill this morning in response to the North Korean missile test. They fired missiles into the waters of the North Korean -- excuse me, of the Korean peninsula as a show of force.

South Korea also put out a video today assimilating an attack against North Korea. Meanwhile, President Trump reiterated his frustration with China for not doing more to reign in its hostile ally. This comes after the President publicly stated, while standing next to South Korea`s President, that his patience was wearing thin.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: The year of strategic patience with the North Korean regime has failed. Many years it has failed and, frankly, that patience is over. Our goal is peace, stability and prosperity for the region, but the United States will defend itself, always will defend itself, always.


TUR: What exactly are the President`s options? You can separate them into three buckets. There is containment, which hasn`t worked for any recent administration. There is negotiation which the U.S. tried in the 90s that did not work. And North Korea is in a stronger position now than it was then. Or there`s military action which could lead to a catastrophic death toll?

We`ve got two people who know a thing or two about high-stakes diplomacy involving North Korea, China and Russia. Chris Hill was the U.S. Ambassador of South Korea and Michael McFaul was the U.S. Ambassador to Russia. Gentlemen, thank you very much. Let`s start with this issue of North Korea. What exactly can the President do right now, Ambassador Hill.

AMBASSADOR CHRIS HILL, U.S. AMBASSADOR TO SOUTH KOREA: Well, I think first of all, he needs to take a retry dealing with some of our European allies that couldn`t go very well last month. In that regard it was a little interesting to hear our U.N. Ambassador kind of threaten people without really regard for what exactly they have done and what we want them to do. So, we`ll have to see how this plays out but I think it`s very important to follow up on what Rex Tillerson said which is we are all in this together. We all need to work together to global problem. We need a global solution. So that`s number one.

And then obviously in these meetings with Putin and Xi Jinping, he really needs to hammer home the fact that they are building a deliverable nuclear weapon and the target is us. And we cannot be indifferent to that, North and the American people expect our government to be indifferent. So, I think he needs to be very firm with the Russians and Chinese.

And the idea that they are proposing that North Korea freeze its tests in return for U.S. and South Korea freezing its exercises is frankly North Korean propaganda, and they should know better. And the North Koreans for years have wanted U.S. not to be engaged militarily on the Korean peninsula. Frankly, they want to kick us out. They want to essentially decouple the U.S. from South Korea. And I think the President needs to take a firm view with respect to the Chinese and the Russians, because the Chinese and the Russians can do a lot better if the object is to slow down and get rid of the North Korean nuclear ambition.

TUR: But so far, the strategy when it comes to North Korea, the Trump strategy seems to have gone completely through China. That is the whole strategy rely on China. In fact, take a listen to Donald Trump talking about how he was going to deal with it.


TRUMP: I would get on with China. Let China solve that problem. They can do it quickly and surgically. That`s what we should do with North Korea.

We have the leverage. We have the power over China, economic power and people don`t understand it. And with that economic power, we can reign in and we can get them to do what they have to do with North Korea, which is totally out of control.

But China is helping us possibly or probably with the North Korean situation. I wish we would have little more help with respect to North Korea from China, but that doesn`t seem to be working out. But I do like the president a lot.


TUR: China, China, China, China, but that doesn`t seem to be working out. So what is next? What happens now, Ambassador Hill?

HILL: Well, again, you know, gross simplification seems to be the anthem of this administration. But, you know, he does need to sit down with the Chinese. He does need to make clear of the Chinese that we`re not prepared to wait for the sanctions to start working, although we do want to see China adhere to those sanctions.

And nor are we looking for China to bring us into a negotiation with the North Koreans unless it`s on the basis of denuclearization. And so far, Kim Jong-un has shown zero interest in that. His father, Kim Jong-il was prepared to negotiation on the basis of denuclearization. In fact, he agreed to it.

So, I think we need to push back with the Chinese and say, Chinese, this is what we`re looking at. We`re looking at all means possible between peace and war and somehow slow down the nuclear program in North Korea, are you with us on that or not. And I think he needs to push. But it would be helpful if he understood the issues, if he read into what the situation is with respect to the reactor, with respect to an underground highly enriched uranium program. And yet, one does not get the sense he wants to do that.

And I would say the big difference between this President and previous presidents with respect to China is previous presidents talked about the need to work China. This President seems to have a different model and sort of outsourcing model. Chinese, you figure this out and we`ll standby.

TUR: Ambassador McFaul, we -- you know, we heard Russia and China, they release that joint statement that said, the U.S. and South Korea need to freeze on military drills. Beyond that, what is it going to take for Russia to intervene?

AMBASSADOR MICHAEL MCFAUL, U.S. AMBASSADOR TO RUSSIA: Well, yes, they just coordinated their positions. They`ve just met on the eve of the G20 summit that makes a lot more difficult for President Trump.

You know, I think the first fundamental point is the Trump and the Trump administration need to devise a strategy, not a single sound bite or a tweet for how they want to deal with North Korea and then they have to engage both the Russians and the Chinese to do so. And I think about when I was in the government when we dealt with Iran, we had a long-term strategy for that ultimate agreement that we got. It started first by saying we are ready to talk. They said no and then we went to something called sanctions.

U.N. Security Council Resolution 1929 that the Russians and the Chinese supported. And without that pressure, we would have never got the agreement that we got. They`re still in the initial stages where I don`t think they`ve decided whether they want a U.N. Security Council resolution, whether they want the Chinese to support it, the Russians to support it until they have a strategy. It`s very difficult to know what to recommend concretely to say to either President Xi or President Putin

TUR: So we have Nikki Haley at the U.N. Security Council meeting today saying their actions are quickly closing off the possibility of the diplomatic solution, which means what would the other solution be? Is that a military solution?

And a moment ago, I was speaking with the former defense secretary William Perry and he was talking about how a military solution is not a viable option either. Take a listen.


WILLIAM J. PERRY, FORMER U.S. SECRETARY OF DEFENSE: We have no good options that are strictly military. A preemptive strike today which we would have considered in the past and which was a reasonable option in the past is not really a good option today. It would certainly lead to military response in South Korea, conventional military response but it could be very damaging to South Korea and it`s possible that that military is escalated into a wider conflict and even escalated into a nuclear war.


TUR: Ambassador Hill, talk to me more about what that response might look like from North Korea if things got -- if there was some sort of military intervention.

HILL: Well, if you look at a map, you`ll see that there are some 20 million South Korean residents who live within range of North Korean artillery. North Korean artillery is very forward deployed right up on the demilitarized zone so our number of North Korean assets. In fact, their whole military is frankly configured for war.

And so, for us to launch a preemptive strike is to invite a retaliation and it would be against South Korean citizens. So the first question would be, are we prepared to talk to the South Korean government about that possibility? And if we are, I rather suspect the South Korean government would not choose a preemptive strike as their first option. They would say, look, well let`s give piece of chance. Let`s look at these various options, et cetera.

And if we go forward with it, I think the problem would be the South Korean government would be rather horrified that we would take action who`s victims or who`s victims of retaliation are going to be South Koreans. And that would do great damage to the U.S. South Korean alliance which is precisely the thing we`re trying to protect. So I think preemptive action is quite fraught as Secretary Perry suggested.

I do believe, however, there should be more effort to look at the various facilities that North Korea has in terms of its nuclear weapons program and see what could be done, frankly speaking just to speak plainly, to sabotage those efforts. I think we need more time. I think we need more time if North Korea is ever going to be pressured through sanctions because it seems that their nuclear development is moving a lot faster than the sanctions are.

So this is indeed a tough issue, but I really think the President needs to lay it out with President Putin that we need help here and spike which seems to be what motivates him in this issue. Spike for us is not going to suffice.

TUR: And Ambassador McFaul, I don`t want to let you go without talking to you for a moment at least about the Donald Trump meeting and the Vladimir Putin meeting that we`re going to see on Friday. What do you expect we are going to see? I know you don`t believe that they`re going to talk about Russian interference into this election.

MCFAUL: Well, they most certainly should talk about Russian interference. I think if President Trump doesn`t bring it up, he`s going to look either weak or ignorant in the eyes of President Putin because Putin knows exactly what he did. And he expects to be pushed back on that subject and he expects to hear never do it again or there`ll be sanctions.

So, I hope President Trump understands that diplomacy is not a popularity contest. It`s a chance to advance American security interest and economic interest and he needs to do that in a tough, robust way in his first meeting with President Putin.

TUR: Do you believe he understands that Putin is going to come to this meeting fully aware of Donald Trump`s strength, his weaknesses that he is the kind of leader who will bring a Labrador to a meeting with somebody who was afraid of dogs, which is what he did when he was meeting with Angela Merkel in Germany?

MCFAUL: Well, I don`t know of any plans for him to bring any dogs to this meeting, but I have been in several bilateral meetings with presidents and Prime Minister Putin. He comes prepared. He does his home work. He does his psychological homework about his Interlaken (ph) tour, and he will come with a game plan to advance Russia`s national interest. I think he`s going to appeal to Trump to say, hey, you and I want to get things done together. And it`s that fake news, and it`s that deep state that`s stopping us. Let`s work together against them. I hope our President that has a sophisticated smart rebuttal to that rather silly idea.

TUR: Ambassador Michael McFaul, Ambassador Chris Hill, thank you guys very much for joining me.

And it is not every day that we have breaking news about Amelia Earhart, but there is now compelling evidence that she didn`t nearly disappear over the pacific. She may have been captured by the Japanese. And there is a photo that may prove it. Stay with us.


TUR: Welcome back to MTP Daily. President Trump is in worsen (ph) on Poland on a second foreign trip. The North Korean nuclear threat will loom large over its talks with leaders at the G20 and his meeting with Russian President Vladimir Putin on Friday. But how will the President`s handling of these foreign crises play here at home.

Let`s bring in tonight`s panel to discuss. Beth Fouhy is senior politics, editor for NBC News and MSNBC, Susan Del Percio, Republican strategist and Jonathan Alter is a columnist for the Daily Beast and an MSNBC political analyst. Guys, you know, I was speaking with William Perry, the Former Defense Secretary a little bit earlier today, and Politico has an incredible article interview with him that, you know, will scare the pants off of anybody who reads. It`s called, "Bill Perry Is Terrified Why Aren`t You?" This is the man who knows a thing or two about facing down the nuclear threat. He is terrified.

Americans don`t seem to be scared and is that changing the politics of how something like this is handled? Is that why the President can go on a tweet storm and talk about maybe we should have a nuclear arms race?

JONATHAN ALTER, DAILY BEAST COLUMNIST: Well, it doesn`t seem as if war is eminent right now and Americans tend to focus on things that are right in front of them.

TUR: Yes.

ALTER: But I think the story about them being able to reach Alaska is getting everybody`s attention. And it is on a front page, for instance, in the New York post.

TUR: Yes.

ALTER: And so I do think it is --

TUR: Is that Bill Withers that is on front page (INAUDIBLE).

ALTER: And Donald Trump`s world it`s a Bill Withers. So surfacing is a bigger issue. The problem for Trump is not just that he has no good options. No president would have good options in this situation. Is that the expectations for him on this issue are especially high.

Just remember, he was elected as the art of the deal guy.

TUR: Yes.

ALTER: Now it`s time to really show that he`s a great negotiator to drive a hard bargain with the Chinese, get them to pressure North Korea. And then if they do go around the table with the North Koreans, it`s got a good deal there. That`s a very tall order.

TUR: So in January he said that North Korea will not get an ICBM. It won`t happen, he tweeted on Twitter. How does Donald Trump explain to his base that the ICBM, that North Korea does have an ICBM now when he to go out there and try to get reelected in 2020?

SUSAN DEL PERCIO, REPUBLICAN STRATEGIST: I don`t think that his plans are trying to explain anything. And Jonathan just, at the beginning, raises such a good point, no president no matter who the president has been for the last several terms going forward has a good solution to North Korea. There are only bad options. And Donald Trump had a lot of his faith early on and told his followers, China is going to fix it for us. I told China we much do it.

Today, he did something very dangerous when he started saying, well, so much for China. It`s been -- basically saying it`s been six months, you haven`t fix a problem that existed for decades. So, I think that the unfortunate part for this country and Donald Trump`s visit this week is that all he is going to do is try to show force to his people at home instead of actually working towards some real solutions while he`s overseas.

TUR: You know, we had an editorial board meeting with the foreign minister of Qatar here at NBC News last week and we were asked him, you know, how do you deal with the President`s tweets? Obviously, he said that countries had an issue with it. And the foreign minister basically said, you know, the President is one thing. We were told to deal with the State Department, which is remarkable in itself.


TUR: But, you know, you have the State Department here. Rex Tillerson doesn`t seem like he is enjoying himself all that much right now. He doesn`t seem to have that much authority. There`s tons of open rolls in the State Department that haven`t been filled. So who is driving this car right now? Is it Trump? Is it the State Department? Is it Secretary Mattis? Is it H.R. McMaster?

FOUHY: Well, what I`m really struck by to answer that question is not so much the tweets but rather that most famous statement that came out of his speech last summer at the Republican National Convention, his accepted speech, he said, I alone can fix this. That`s when his attitude go into so many of these promise. I alone can fix your health care. I alone can fix the economy. Now he`s faced with an I alone can fix it situation which he clearly cannot. He is stuck now with the same rhetoric that, you know, if you want to say it was a piece of debate (ph), it`s his statement of what he is capable of doing.

He did tweet, you know, there will never be an ICBM on my watch. Well guess what. It happened on his watch. He alone cannot --

TUR: And a few months of him tweeting that.

FOUHY: Yes. He alone cannot fix this and he is trying to figure out the next move. He seen that -- as one of your guest in the last segment when the ambassador said he seemed to try to outsource everything to China as supposed to engage China in a diplomatic fashion or in a useful fashion. Instead he talks about his great personal relationship with the Chinese leader without actually doing the work of working in that kind of partnership. That`s what need he needs to start doing is start to get off the (INAUDIBLE) away from his ego if he can and work alongside with people who can maybe make this happen.

TUR: That`s the advice for literally everything that Donald Trump has had to deal with and it`s not.

FOUHY: Right. And it`s the most serious thing of all.

TUR: It`s definitely the most serious. It is much more serious in getting into a fight with, you know, Cable News host, even though people found it appalling, that this is a threat of a nuclear showdown.

But if no president has any -- has a good option, no one has had a good option up until now, there isn`t a good military option on the table. Diplomacy hasn`t work so far. What do you do with the status quo? You just trying --

ALTER: No, no. We know what needs to be done which is to work with China and Russia. You know, most of what runs the North Korean pathetic economy comes from China where there are sanctions but they could be much, much stronger. In order to do that, to essentially keep anything from coming in or going out of North Korea, you need the full cooperation of the Chinese government. That`s not something to tweet about and demand. It requires very careful diplomacy with a series of carrots and sticks.

And by means of comparison, Barack Obama spent much of his first term secretly working with China and Russia to get them to not veto a Security Council resolution for sanctions on Iran, trying to bring them to the table. It worked. But it was hard work.

TUR: Three dimensional chess.

ALTER: Three dimensional chess --

TUR: Yes.

ALTER: -- which this guy doesn`t seem to know how to play.

DEL PERCIO: So at this point, we know it really is up to China. And they also have a lot of concern about what`s happening in the peninsula there. So, it`s a question of how far does China think they could give us lip service to how far China think that they actually -- and they have to do something whether it`s -- listen, that we`ve known that they -- that China bribes the generals in North Korea. We know that they have relationship. We know they have the influence to change a regime if it`s necessary.

It is, though, a really scary game of chicken, but it is one that is going to be driven by China whether --


ALTER: When they had a puppet (ph) state.

TUR: And what happens if China tries to depose the current regime in North Korea? What these days winding (ph) effect if that happen. But then also, there`s always to talk about they don`t want the North Korean refugees. And then what happens if they are just stronger Korean peninsula stronger, American influence in that region. It`s not just so easy for China to walk in there and say we`re going to deal with this, right?

ALTER: What a good president -- first of all, I`m not sure that it`s that clear that China has that much --

DEL PERCIO: I think it`s been proven that it`s pretty clear at this point.

ALTER: There`s no history of it since they create war where they`ve been able to have regime change because they wanted it. So, the challenge for a president is to work a whole variety, a very complex angles. The Chinese are very sophisticated diplomatically. You can`t just have Nikki Haley go out there and say, we`ll have a trade war if you don`t do it our way. That`s not the way you handle things.

And a lot of it needs to be done in secret which this President doesn`t seem to be every into doing. Seek quiet diplomacy. Experience helps, none of these guys have any experience. Tillerson doesn`t. So, he -- that worsens already that situation.

TUR: Are you guys nervous?

FOUHY: Yes. And what I was going to say to that point is if you`re be able to reset (ph) your hammer, everything looks like it now. I mean that sort of how Trump behaves. And this is the situation where -- absolutely, as you describe, you cannot solve the problem this way. It`s so delicate. It`s so serious.

TUR: You can`t hammer (INAUDIBLE), let`s put it that way.

FOUHY: No, you can`t. And it`s so serious as you`re saying. And this is where --

DEL PERCIO: To change your question, yes, it`s frightening.

TUR: That isn`t Jon (ph). I`ve got no words. So stick with us, we`re going to have you a little bit -- back later in the hour.

Still ahead, the health care debate didn`t take a holiday over the July 4th weekend. I`ll talk to Virginia Governor Terry McAuliffe about that fight, plus his refusal to cooperate with the White House request to hand over voter data.


TUR: Welcome back. Nearly every state says they either won`t comply with the request for voter data made by President Trump`s Election Integrity Commission or they will only offer limited public available information. That commission was launched by executive order in May to study improper voter conduct and what the president alleges is fraud in federal elections despite the fact that instances of voter fraud are extremely rare.

According to the Brennan Center for Justice, it is more likely that an American will be struck by lightning than impersonate someone else at the polls. Regardless, the commission sent a letter to 50 states and Washington D.C. last week requesting voter data including date of birth, party affiliation, voter history, and the last four digits of social security numbers in states that record that information.

NBC reports that five states are still reviewing the request or have a position that is unknown. Twenty-six states say they will give the commission their public data only which in many cases does not include all of the criteria requested. Just moments ago, Vermont announced they will not comply, meaning now 19 states say they will not comply with the commission`s request whatsoever. And look at the map. Red states and blue states alike are refusing to cooperate with the Voter Integrity Commission.

One state we left off the list, Kansas, whose Secretary of State Kris Kobach is the vice chair of the presidential commission, they are releasing public data but withholding social security numbers though they say they may release some in the future. Kobach released a statement this afternoon pushing back against reports that 44 states are not totally complying with his commission. He called those reports false and more fake news.

We here at NBC News stand by our reporting. Next on "MTP Daily," Virginia Governor Terry McAuliffe on what states want to see from the senate`s health care bill. And could a newly released photograph offer incite into the decades old mystery surrounding Amelia Earhart`s disappearance? But first, Aditi Roy has the "CNBC Market Wrap." Hi, Aditi.

ADITI ROY, GENERAL ASSIGNMENT REPORTER FOR CNBC: Hi there, Katy. The price stocks on Wall Street closing mostly higher as the text sectors snapped a three-day losing streak. The Dow lost a point, the S&P added 3 points, the Nasdaq gaining 40 points. The Federal Reserve releasing the minutes from its June meeting.

FED officials signaling the Central Bank will be able to start shrinking its massive $4.5 trillion balance sheet as early as September. As drop in oil prices weigh heavily on the energy sector, U.S. crude oil prices settled more than 4 percent lower, breaking an eight-session rally. That`s it from CNBC, first in business worldwide.


TUR: Welcome back. That was the scene at the 4th of July event yesterday with Senator Ted Cruz of Texas who faced shouts from a crowd of people on health care which is front and center from many members of congress back at home this week. At a 4th of July parade in a remote town in Maine, Republican Senator Susan Collins told "The Washington Post" that the only thing anyone wanted to talk to her about was health care.

Some senators are also hearing from their own governors at home, a number of whom have been very vocal about their concerns with the health care bill in congress and any rushed time line. Two of those governors from different sides of the aisle, Democrat Terry McAuliffe of Virginia and Republican Charlie Baker of Massachusetts, recently wrote a joint letter to Senate Majority Leader Mitch McConnell on behalf of the National Governors Association arguing for states to have enough time to review any health care bills.

Joining me now is one of those governors, Terry McAuliffe, the chairman of the National Governors Association. Governor, thank you very much for joining us.


TUR: Let`s talk a little bit about health care. Democrats as you well know don`t control the house. They don`t control the senate. They don`t control the White House. They were losing special elections. What influence, what weight does the Democratic Party have right now when it comes to trying to push back on health care? Can they do anything?

MCAULIFFE: Well, first of all, public opinion like you just showed on that clip like you had before, people are outraged around the country. But I think the message we are trying do do as governors, both Democrats and Republicans have come together. I, as chairman of the National Governors Association, Charlie Baker, Republican of Massachusetts, who has committee on health, we sent a letter to Leader McConnell asking we need time, we need to go to this plan.

The plan that the senate put out will cut, I mean cut health care benefits by $772 billion over 10 years. This will be devastating to the Virginia economy. I will lose 1.4 billion between 2010 and 2020. Governors, we are the ones that have to implement this plan. So what you`re seeing is Republican and Democratic governors coming together to get with their senators and saying do not vote for it. You`re hurting your state as a senator. You represent your state.

As governor, I`m telling my senators, Mark Warner and Tim Kaine of course who support, we are together on this. But for other states where they have Republican governors telling Republican senators, you cannot pass this. It was done in secret. It literally will gut the program. And at the end of the day, Katy, it is going to hurt the most vulnerable. It is going to hurt the seniors. It is going to hurt those with preexisting condition who can least afford to be hurt today. It is going to be so expensive that many people will lose their health care.

TUR: Governor, to be fair, Republican senators ran on repealing Obamacare. That`s what they got voted into office to do.

MCAULIFFE: What I think they try to tell American public is they will repeal health care and they will make it better. That was their talking point. Now, we know the results. They repeal health care. $772 billion cut. Millions of people will lose their health care. Elderly citizens, you know, when you look at 65 percent of my Medicaid expenses (inaudible) Virginia, is elderly long-term care, elderly long-term care.

What am I going to do? Throw these people out in the streets? What will I do with individuals with preexisting conditions? So the point is, it was a nice talking point in the campaign, but what they try to convince Americans that we are going to repeal and give you something better and it will be better for you, now we know it is not going to be better, it is going to be bad for America and it is going to hurt millions and millions of Americans. That`s the box that they are in today.

The rhetoric of the campaign has not hit the reality of governing and they are in a very tough spot. They need to work, Democrat and Republicans in Virginia. I have a very Republican legislature. We work together on economic development, on issues of education, on issues of transportation. People got to work together. Washington is broken because nobody will work together.

TUR: Governor.

MCAULIFFE: Let`s get together and figure this out.

TUR: We are pressed for time, so excuse me for interrupting.


TUR: Let`s talk a little bit about this commission, what the president calls a voter fraud commission. He is saying that he is wondering what states have to hide. So, what Virginia have to hide?

MCAULIFFE: First of all, we are not handing this data over. This is personal information of individuals to hand over commission which has no authority. Congress has not given them any authority. And the people involved with this commission are the poster children for voter suppression. We are not going to use our data to try and disenfranchise voters and knock people off voting rules.

TUR: So you believe it is a voter suppression panel more than anything else?

MCAULIFFE: Absolutely. Look at the folks that are involved in this. They have a history of doing this. We are not taking Virginia`s personal data and handing it over. It`s their data personal information. I`m not giving that to anybody. But they have a history of voter suppression. We should make it easier for people to vote.

That is why 40 plus states have said we are not going to do it. This is because President Trump cannot believe that Hillary Clinton got 3 million more votes than he did and he is trying to pretend that there are millions and millions of people who went into the voting booth incorrectly which is not true. We do not have voter fraud in Virginia.

It doesn`t exist in America. So, get over it. Let`s work together to make it easier for people to vote. I`m proud of all of the fellow governors and secretary of states who said, no dice, you`re not getting the data, and you`ll never get it.

TUR: Governor, I never get to talk to you, so you have to forgive me when I press you on this. You are a family (ph) guy. You are plugged in. You have been around democratic politics a long time. You no doubt are having conversations behind the scenes. No doubt those conversations are probably everyday. Who is the leader of the Democratic Party right now?

MCAULIFFE: I think there are many leaders of the Democratic Party. I will always.

TUR: Give me a name, governor. Give me a name.

MCAULIFFE: I`m not going to give you -- I`ll say the governors who are leading their states, creating jobs, building infrastructure, building education system that works, we have to balance our budgets. Unlike Washington, they print money and they still can`t balance the budget.

We create jobs. We build infrastructure. We do education. Governors need to lead the way. Listen. I compliment the folks on Capitol Hill who are doing what they are doing, but, you know, we need some action out of Washington to help us compete on a global basis. Today, we are not seeing anything out of Washington. It is broken.

TUR: Governor, you are a governor, are you talking about yourself?

MCAULIFFE: Yeah. Oh no, as chairman of National Governors Association, I love all of our governors that we have today. Listen. We have to lead, Katy. You know that. And that`s what we are going to do.

TUR: I`m just confused.

MCAULIFFE: We have to deliver results.

TUR: I`m confused because I have asked a number of democratic, you know, big names of Democratic Party this question over the past six, seven, eight months. I can`t get an answer from anyone about -- I can`t get one name from anybody about who is leading the Democratic Party right now. What does that say?

MCAULIFFE: I don`t think there is one person today. You know, I run the state of Virginia today. That`s what I got elected to do and 66 percent of the state think we are heading the right direction. People are happy in Virginia. But, you know, what people on the national level, you know, people got to worry about what they got elected to.

I, as a governor, got to worry about the commonwealth of Virginia as my you my fellow governors and senators and congress folks. But I got to tell you this, Katy. Things are not working in this country today. I just got back from my 28th nation trade trip. I got to tell you, when you go abroad right now, they are asking questions about trade, about immigration policy. The Trump administration has done nothing but make it harder for me to bring jobs back to the commonwealth of Virginia.

TUR: Governor Terry McAuliffe, thank you so much for coming on.

MCAULIFFE: Thank you, Katy.

TUR: I appreciate your time.

MCAULIFFE: Thank you.

TUR: Still ahead, shedding new light on an 80-year-old mystery. New evidence that Amelia Earhart survived her crash in the Pacific, and there is a photo that just may prove it.


TUR: Welcome back. The story that really has everyone talking today isn`t North Korea or Russia or health care. It is a potentially blockbuster development in one of the world`s most enduring mysteries. What happened to Amelia Earhart? A team of investigators has unearth a photo that they believe shows that the legendary aviator, Amelia Earhart, survived a crash landing in the Pacific Ocean in 1937.

The picture found in a formally top secret file in national archives and possibly taken by a U.S. spy shows a woman resembling Amelia Earhart and a man who appears to be her navigator, Fred Noonan, on a dock in the Marshall Islands. NBC`s Tom Costello has more.


TOM COSTELLO, NBC NEWS CORRESPONDENT: In 1937, the Japanese had banned nearly all westerners from the island. But in the photo, it appears there are two Caucasians on the dock. A man standing on the left and what appears to be a woman with short hair wearing pants like Earhart sitting on the edge. Henry took the photo to facial recognition expert, Ken Gibson, who first overlay the photo of the man with file photos of Fred Noonan.

KEN GIBSON, FACIAL RECOGNITION EXPERT: The hairline is the most distinctive characteristic. It`s very sharp receding hairline. The nose is very prominent.

COSTELLO: The teeth, hairline, and nose all appear to match up.

GIBSON: It is my feeling that this is fairly convincing evidence. This is probably Noonan.

COSTELLO: Then, the person sitting with back to the camera with hair that appears too long for a man and too short for a native woman. Gibson compared the body measurements with previous photos of Earhart. Again, striking similarities.

GIBSON: I usually go from not likely to likely to very likely to extremely likely. I would say this is very likely.


TUR: Wow! We are going to have Tom Costello up with us next in just a moment to talk more about this stunning discovery.


TUR: Time for "The Lid." We are diving into a fascinating new development on the mystery of the Amelia Earhart disappearance. NBC`s Tom Costello has the story for us. Tom, I got to say I have watched your piece on "Today Show" once. I have seen a bunch of hits on it throughout the day on MSNBC. Every single time I see that video overlaying Noonan`s face from file footage on to that new photo, I am stunned. What more can you tell us about this and what else are we going to end up learning?

COSTELLO: Of course there are skeptics. There are people who say the photo is too grainy, that you can`t see anything for sure. However, you know, the photographic analysis is pretty compelling especially on Noonan as you saw and the body measurements of Amelia Earhart, from underarm to underarm, from her trunk, all are very compelling. And look at the hair and look at the fact that a woman in 1937 is wearing pants.

TUR: Yeah.

COSTELLO: All of that is very compelling. What`s even more compelling is that she is sitting on a dock, it would appear surrounded by natives, by locals, and she is staring at the ship. Evidence is that that is the Koshu, the Japanese merchant ship, Koshu, and it is trailing something on a barge. They have blown that evidence up, what is on the barge, and they believe that it is a 38-feet piece of something.

Her plane was 38-feet long. But here`s what makes this compelling. This is not coming out of the blue, this is coming after decades of people on the Marshall islands and in Saipan, saying that she crash-landed in the Marshall Islands, was picked up by the Japanese, specifically they have said for years by the Koshu, and that they took her eventually to Saipan where she and Noonan died in Japanese custody.

How they died? There`s one report that Noonan was beheaded, that she may have died of dysentery in a prison. But the history team, the history channel investigator team, unearthed a lot of evidence not only with interviews but also this document and this photograph.

TUR: Tom, why now, though? Why are we learning about this today and not 10 years ago, five years ago? Why today?

COSTELLO: Listen, some of the history channel`s timing is probably tied to the 80th anniversary of her disappearance. However, it is true that a former treasury investigator by the name of Les Kinney, who has been obsessed with the Earhart drama for years has spent 15 years in his retirement looking for clues. He went to the national archives, couldn`t find anything in a file marked Amelia Earhart.

By the way, there is however a catalog and one of the items in the catalog says a report on Amelia Earhart taken prisoner in the Marshall Islands, but that document is missing. But he did then start going through any photographic evidence of the Marshall Islands, because back then the United States was gathering photographs of all of these islands that they thought the Japanese were active in, because, of course, the Japanese were rolling across the Pacific at that time.

And so this photograph was in a file marked Marshall Islands. It didn`t say Amelia Earhart on it. Had it, it might not have been in that file. But Les Kinney started going through hundreds of photographs with a very tight microscope or magnifying glass I think you should say, and he discovered what he believes could be Earhart and Noonan.

TUR: Tom, hold on a second, I`ve got the panel with me. Beth Fouhy, Susan del Percio, Jonathan Alter. John got a question for you.

JONATHAN ALTER, COLUMNIST FOR THE DAILY BEAST, MSNBC ANALYST: Tom, setting aside the photograph for a minute, I was fascinated when earlier today you said that the U.S. government after the war didn`t want to pursue this because it might upset U.S.-Japanese relation at a time when we were getting on good terms with them and trying to help them rebuild their society.

Might there not be some cable traffic or other documents in State Department files maybe that related to the MacArthur occupation of Japan or other relations with Japan in the 10 or 15 years after the war that might shed light on this?

COSTELLO: Yes. Let me be clear. I was asked why would the United States not have confronted the Japanese with that photograph after the war or presented it, and I said among the theories is that the United States would not want -- may not have wanted to embarrass Japan. But we don`t know. We have no idea what happened post World War II.

However, I will tell you that the two-hour documentary on the history channel includes intercepted coded communications with the Japanese. All of that will be laid out in their documentary on Sunday. And those coded communications seem to suggest that they knew where Amelia Earhart was back in 1937.

BETH FOUHY, NBC NEWS SENIOR POLITICS EDITOR: Hey, Tom, this is Beth Fouhy. Just to that point, is that perhaps why Amelia Earhart and Noonan were never heard from again? If indeed they did land and they were alive that there was never any effort to let them communicate with their families or anyone else? That somehow we`re thinking that there was some sort of government involvement or perhaps conspiracy that kept them silent all these many years?

COSTELLO: Right. So why would in theory, in theory, why would the Japanese have taken them into custody? Well, the theory goes because the Japanese were involved in a buildup, a military buildup in the Pacific at that time, and they may have been convinced that she in fact was a spy. And the locals have said all along, she is a spy, don`t talk about this, we`re taking her into custody.

That`s what the locals said that the Japanese told them at the time. So if they believed that she was a spy, then they -- or they were afraid that she saw something she shouldn`t have seen, they may have just decided it was in their interest just to take her back to Saipan and therefore not tell the world that she was in their custody.

TUR: Tom, if the ship was towing her plane, wouldn`t the plane still exist somewhere?

COSTELLO: No, because the plane was allegedly taken back to Saipan, a 2,000-mile voyage, back to the big military base in Saipan, and many witnesses have said that that plane was eventually scuttled and thrown into a big heap of wreckage after World War II. And in fact they claim that wreckage right now sits underneath the main airfield in Saipan.

TUR: And again what`s the deal with the stamps?

COSTELLO: So, in the 1980s, the Marshall Islands even issued those stamps, you see right there. They were so convince that this is fact, this has been what they talked about for decades, those stamps show the plane landing in the Marshall Islands, the natives seeing it, and the Japanese ship Koshu taking the plane away. So what`s fascinating now about this photograph is it seems to cement the timeline and the narrative that`s been going on for decades.

Marshall Islanders have said for years she crash-landed there. The Japanese ship Koshu picked her up. They took them over to (inaudible) Island and then on to Saipan. This photograph seems to show exactly that. Can I just quickly tell you, we have reached out to the Japanese for comment. The minister of defense, the foreign ministry of the national archives all say they have no documentation to suggest they ever had Amelia Earhart in custody.

TUR: You know, we can keep talking about this for the rest of the show, but I`m told we have to take a break. I`m sorry, Susan, I talked over your question. What an anchor monster I`ve turned out to be. Guys, thank you very much. Tom, thank you. Beth, Susan, and Jonathan. After the break, some news today about the FBI`s future and its past. Stay with us.


TUR: In case you missed it, there is still no director of the FBI. It`s been 57 days since James Comey was fired, 28 days since the White House named Christopher Wray as his replacement. And today, we finally have a timetable for when he will get a vote in the senate. Wray`s first hearing before the Senate Judiciary Committee will be July 12th, one week from today.

From the FBI`s future to its past, in case you missed it, it was one year ago today that then FBI Director Comey announced the findings of the investigation to Hillary Clinton`s use of a personal e-mail system while secretary of state. Comey`s statement Clinton erred in judgment but he would not recommend charges. And that, as they say, is history. That`s all for tonight. We`ll be back tomorrow with more "MTP Daily."