The Rachel Maddow Show, Transcript 12/07/11

RACHEL MADDOW, HOST: Good evening. And thanks for joining us tonight from Washington, Gingrich, where everybody thinks the center of the action, center of gravity in this town is the big building you see behind me, the United States Capitol. And if the center of gravity in this town isn`t there, most the people think it`s the White House, right? But on most days, what is at least in competition for the center of gravity in Washington, Gingrich, for the center of the Washington, D.C. universe, is this place -- K Street where the lobbyists here in Washington have their offices. If the press is the fourth estate, K Street is kind of the fifth estate. Today, this is what K Street looked like -- hundreds, perhaps a thousand protesters swarming K Street and essentially managing to shut it down. These are 99 percenter protesters, some aligned with the Occupy D.C. movement, some aligned with the labor movement. They descended on K Street today as part of this week`s "Take Back the Capitol" protest. They marched on some of the biggest K Street lobbying firms. And all about a dozen people were arrested at that action. That was the scene on K Street earlier today. As day turned to night, however, the scene was a little bit different. Tonight, the man of the hour in Republican politics was toasted at a $1,000-a-plate K Street fund-raiser hosted by and expected to be populated almost entirely by D.C. lobbyists. With all the most recent polls showing Newt Gingrich either far out ahead or in the state where Romney is holding on, Gingrich rising fast. With the most recent alternative to Mr. Romney, Herman Cain now completely out of the race, with less than a month to go before voting in the Iowa caucuses. On a night like this in Washington, the Republican field is starting to appear settled. The front-runner position may yet change. Mr. Romney may yet come back. Somebody else may yet have a late surge. Mr. Gingrich may yet fall apart. But with this little time left before the voting starts, we know effectively what role each of the Republican candidates has had in the primary process. Not just what they offer as a presidential choice for Republican voters but what purpose they serve for us as a whole country watching the Republican Party trying to make this internal decision about who that party wants to nominate for president. Among these primary candidates, we now know what everybody`s role is, what everybody is here for. And in most cases, it`s sort of surprising. It`s not what you have thought when the campaign first started. Mitt Romney is the only real non-surprise in the group. Mitt Romney is and has always been the establishment candidate, the obvious next choice, the guy who came in second last time. And he`s been the establishment guy to the nth degree. Mr. Romney now literally has locked up support from 10 percent of the billionaires in this country. But against Mr. Romney, who would have thought that Jon Huntsman`s role in this campaign would have been not really to attract any support from basically any voters anywhere, but rather to be the guy in the race who runs the most effective ads against Mitt Romney? (BEGIN VIDEO CLIP) UNIDENTIFIED MALE: He is very conflicted. He is drawn in two different directions. Very powerfully, if he`s with an audience, he wants to identify with and satisfy that audience and will say what he thinks they want to hear. MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: Look, I was an independent during the time of Reagan/Bush. I`m not going to return to Reagan/Bush. The right course is the one championed by Ronald Reagan 30 years ago and by John McCain and Sarah Palin today. (END VIDEO CLIP) MADDOW: That has turned out to be Jon Huntsman`s role in this race. Not to win it, or really even contest it, but to devastate Mitt Romney in ads like this. That has been the Huntsman surprise this year. Similarly, there`s Ron Paul. His role in the campaign this year has not been to galvanize the youth vote, at least so far, or to popularize the gold standard or any of his other Ron Paul stuff. Instead, Ron Paul has turned out to be the guy this year who runs really effective ads against Newt Gingrich. (BEGIN VIDEO CLIP) UNIDENTIFIED MALE: Everything that Gingrich railed against when he was in the House, he went the other way when he got paid to go the other way. UNIDENTIFIED MALE: He`s demonstrating himself to be the very essence of the Washington insiders. UNIDENTIFIED MALE: It`s about serial hypocrisy. (END VIDEO CLIP) MADDOW: Ron Paul`s turning out to be the institutional memory guy. He`s here to remind everybody what Newt Gingrich has been like all these decades in Washington as a politician. Rick Perry has turned out to be the guy who`s here to humble the common wisdom, here`s to humble the common wisdom of the Beltway media. On paper, Rick Perry was supposed to be winning this race now. He was the game changer the media predicted would turn this race upside-down. Honestly, I also thought that he would turn the race upside-down. In reality, Rick Perry is now polling at 7 percent nationally and 9 percent in Iowa, where he`s trying really hard. Rick Perry has disappeared. Michele Bachmann has also turned out to be a bit of a surprise. Ms. Bachmann is not in the race this year it turns out to represent the kooky fringe of the conservative movement like a lot of people thought she would. Michele Bachmann is here instead to give the rest of the country useful, practical information about crazy stuff the Republican base believes. Things they believe because they`ve heard it from the conservative media, which it turns out Michele Bachmann channels as if she were a tuning fork. (BEGIN VIDEO CLIP) REP. MICHELE BACHMANN (R-MN), PRESIDENTIAL CANDIDATE: There`s reports that have come out that Cuba has been working with another terrorist organization called Hezbollah. And Hezbollah is potentially looking at wanting to be a part of missile sites in Iran and, of course, when you`re 90 miles offshore from Florida, you don`t want to entertain the prospect of hosting bases or sites where Hezbollah can have training camps or perhaps have missile sites or weapon sites in Cuba. This would be foolish. (END VIDEO CLIP) MADDOW: When Michele Bachmann says she`s worried about Hezbollah in Cuba, turns out it`s not just comic relief. She is playing a useful role here. She`s giving the country fair warning that the Republican base is actually worried about something they have made up about Hezbollah in Cuba. Thank you for letting me know. Rick Santorum also has a role in this year`s race. His role is -- oh, I`m sorry, that was actually my own typo. Rick Santorum does not have a role. He`s just Rick Santorum. Finally there`s Newt Gingrich. Newt Gingrich started off as the grumpy profiteering also ran Gingrich scam artist guy with all the offices on K Street. But as a late surging front-runner now, Mr. Gingrich has turned to play a really useful role in the race. Not just for Republican voters trying to make a decision about who to vote for for president, but for the whole country trying to understand Republican politics right now by watching this Republican presidential race. Newt Gingrich I think is the Jonathan Swift character in the race. He`s the "eat the poor" candidate. It was 1729 when Irish satirist Jonathan Swift wrote a satirical essay called "A Modest Proposal" -- about how the wealthy should deal with the way too many poor people among them. Jonathan Swift wrote, quote, "I think it`s agreed by all parties, that this prodigious number of children in the arms, or on the backs or at the heels of their mothers and frequently of their fathers, is in the present deplorable state of kingdom, a very great additional grievance. And therefore, whoever could find out a fair, cheap and easy method of making the children sound and useful members of the commonwealth, would deserve so well of the public to have his statue set up for a preserver of the nation." In other words, it would be good for the country to find a use for all the poor kids underfoot and in the way. What is the best use of the poor? Jonathan Swift went on to offer his own solution. He said, quote, "I have been assured that a young, healthy child well nursed is at a year old a most delicious, nourishing and wholesome food, whether stewed, roasted, baked or boiled; and I make no doubt it will equally serve in a Fricasle or Raguost." We got to find some useful purpose for the poor. But Jonathan Swift in 1279 suggested eating poor children. He suggested it in order to shock people into thinking about the poor in some way other than their utility or disutility to the rest of society. Newt Gingrich is not suggesting eating poor children. He`s suggesting that we get rid of child labor laws. Take kids out of the classroom and put them to work as janitors, because that would be useful. The difference is that Jonathan Swift was a satirist. Jonathan Swift was kidding. Mr. Gingrich is not kidding. And he has been not kidding about this stuff for a long time. In Congress in the 1990s, he argued that the federal government should take children away from mothers on welfare. The federal government should take kids away from the moms and ship the kids to orphanages. Poor women should lose their children for the crime of being poor. Reporter Tim Murphy reminding us about Newt Gingrich`s scammy education enterprise in the 1990s called Earning by Learning. It was supposedly a summer reading program offering kids 2 bucks for every book they read. "The point of the story," Mr. Murphy wrote, "is that private initiatives often succeed where government programs fail. Earning by Learning was a lean, mean private machine." Quote, "The overhead is entirely voluntary," Mr. Gingrich said of the program in 1995. The only money goes to the kids. So, if you have $1,000 at 2 bucks a book, you can pay for 500 books. Whereas in the welfare state model if you have $1,000, you pay $850 of that for the bureaucracy." The only problem is that when "The Wall Street Journal" looked into Mr. Gingrich`s program that year in 1995, they found that 90 percent of the money raised, 90 percent of the $20,000 raised in the past year, had gone to a man named Mel Steely and two other professors. Mel Steely was a former Gingrich staffer who was at the time working on the authorized biography of the House speaker. So at least that guy was earning. Tim Murphy also notes today another instance where Mr. Gingrich was caught transferring money for a scholarship program he had set up for inner city students, a scholarship known as the Abraham Lincoln Opportunity Fund. Mr. Gingrich was caught transferring money from that fund to his own political action committee. Newt Gingrich is getting people to donate money under that guise of it going to poor people and then essentially taking that money for his political action committee and for his official biographer. Now that he`s running for president, going after poor people, specifically going after poor kids has become a centerpiece of his campaign. (BEGIN VIDEO CLIP) NEWT GINGRICH (R), PRESIDENTIAL CANDIDATE: In very poor neighborhoods, you have to literally reestablish the dignity of work. I will tell you, personally, I believe the kids could mop the floor and clean out the bathroom and get paid for it and it would be OK. They`d be dramatically less expensive than unionized janitors. And you`d begin to reestablish the dignity of work. (END VIDEO CLIP) MADDOW: And they`re delicious Make poor kids work as janitors. Mr. Gingrich now trying to appear more compassionate about this by making clear while it would be OK for poor kids to be put to work cleaning toilets, he does not want them working in coal mines. That would be cruel. So, there`s that. Mr. Gingrich also said this week that he would make the main theme of his campaign in a general election against Barack Obama an attack on food stamps. Mr. Gingrich today calling President Obama, quote, "the finest food stamp president in American history." That`s a charge that Mr. Gingrich has decided to level in knowledge of the fact that this president was, in fact, raised by a mom who at one point was on food stamps while she was racing him. In case it wasn`t clear yet that the whole compassionate conservatism thing was dead, Newt Gingrich is here to remind us all that the whole compassionate conservatism thing is dead. It is useful to have Mr. Gingrich playing this role, articulating this viewpoint in this race. It`s a return to Reagan era attacks on welfare queens, right? It`s "eat the poor" time. Everybody`s got a role to play in this Republican campaign, except for Rick Santorum, of course. Everybody`s got a role to play. And Newt Gingrich`s role as front-runner is that he`s a bit of a clarifying tonic, for the whole country trying to understand the difference between the two parties on the most important issue of the election and the most important issue in the country which is, of course, pain -- economic pain. The worst income inequality we have seen in generations. Joining us now is Karen Finney. She`s a former DNC communications director, columnist for "The Hill" and an MSNBC political analyst. Karen, it`s good to see you. KAREN FINNEY, MSNBC POLITICAL ANALYST: Good to see you. MADDOW: You haven`t been on the show before, so you don`t now how long I talk for. I should have warned you. FINNEY: But I`ve watched. So, I knew. I settled in. MADDOW: You knew to settle in. Oh, I can take off my seat belt. It`s going to be a while. Newt Gingrich appears to have fully embraced this idea of going after poor kids, specifically not just poor people but poor kids. That seems to me to be a sort of dangerous general election platform to run on. Do you think it might work in the Republican primary? FINNEY: I sure hope it doesn`t work. Did you notice how, though, the way he was sort of trying to back up a little bit from that was the proposal he came up with none other than Donald Trump? That`s who you go to do make up for saying -- MADDOW: Well, poor kids could work for Donald Trump, too. FINNEY: Indeed. Scrubbing the toilets, why not? Hey, why not? Yes, I can`t imagine that works because I do think that people like to think of themselves as more kindhearted than to think that children should be scrubbing toilets. The problem, though, Newt`s whole -- the problem of this candidacy, this is the new Newt, right? This isn`t the old Newt, the guy who was the only speaker in the United States to have been admonished for, oh, what, using college courses for political purposes. You know, he`s the guy -- he`s this outsider and been doing all these good works and he`s calm and reformed and he`s found God, right? That`s the whole premise. The thing about the comments he made is that`s the old Newt. That`s the true, vindictive person who`s in there. I think it`s just a matter of time before we see more of that come to the surface. MADDOW: I think we think of old Newt, the so-called bad Newt as a person who`s vindictive against his political enemies, as a person who was sharp tongued in a way that sometimes didn`t serve him well against people who were his political equals. But this is actually picking as a scapegoat -- kids. And he -- after doing it -- he hasn`t backed off of it so much as he keeps explaining it. And he does get applause for it at Republican events. So, I guess the broader question is whether or not -- not so much what this says about him but what this says about the tenor of the country. Is -- are we at a point that people are ready for a scapegoat? FINNEY: Well, sure. I mean, we`ve seen in polls for some time now -- I mean, there`s a sense -- initially when the economic downturn started, right, people were taking some responsibility, maybe it was a mortgage I couldn`t afford. Now, people are sick of that. It`s, OK, whose fault is it? MADDOW: Yes. FINNEY: Is it Congress is broken? Is it your fault because you`re irresponsible? And you`re right in that it goes back to the idea of the welfare queen in that it goes to this idea that people are irresponsible. And he was even trying to say, well, it`s not the kids` fault that they`re irresponsible. MADDOW: Poor people don`t know the value of work. FINNEY: They have nobody to teach them. My goodness. The one thing I say, though, about this new/old Newt, he`s a vindictive guy but he`s a guy who lets his ego get out of control. He`s an ideas guy who lets his ideas kind of get away from him. That was part of the problem when he was speaker. And remember, his own people took him out because of that, because they were so concerned he had become such a liability and he was so volatile, because he would say crazy things like I remember that whole boys town episode. And all of his caucus was like, oh my God, you know, what are we doing with this guy? MADDOW: Limited government that takes children away from people because they`re poor. FINNEY: It does remind people that, you know, he`s still got that stuff in there and still could implode in a general election. MADDOW: As a former communications director for the Democratic Party, if you were sitting at DNC headquarters tonight, would Newt Gingrich -- would you be enthusiastic about the prospect of running against Newt Gingrich this year? Would you be happier with a Gingrich candidacy than Mitt Romney candidacy? FINNEY: I think I would. Although I will tell you, I`m wondering if Newt`s other role in this primary, is if Newt is to Mitt as Hillary was to Obama. In that, I mean, if Mitt Romney is going to take on Newt Gingrich and emerge victorious in this primary, he`s going to have to up his game in a way that he really hasn`t thus far. MADDOW: He has been campaigning harder since Gingrich has been ahead. FINNEY: And he`s going to have to be smarter and better and, you know, more in control of his emotions. He can`t, you know, pop off at FOX News, for example, who`s your ultimate ally. So I wonder if that`s part of Newt`s role. The prospect of running against Newt would be wonderful. I mean, there`s so much we haven`t even -- you don`t even have to talk about the three marriages before there`s so much other good stuff on him and how he`s abused his power, his influence. You know, pay for -- money for access. There`s plenty of good stuff there that he can use and fill -- 365 days of just fun times. MADDOW: Maybe we can have the election season extended. FINNEY: How about that? MADDOW: Karen Finney, former DNC communications director, columnist for "The Hill," MSNBC political analyst and first-time guest here. It`s really nice to see you here. FINNEY: Good to see you. Good to be on. MADDOW: Appreciate it. All right. According to former House Speaker Newt Gingrich, former House Speaker Newt Gingrich is awesome. On the basis of that alone, we would desperately like to have Mr. Gingrich on the show and have extended the invitation. While we`re still waiting for him to get back to us, we are extremely excited tonight on this show to welcome his sister. Candace Gingrich is the interview tonight. That`s coming up. (COMMERCIAL BREAK) MADDOW: The director of the president`s National Economic Council joins us next. (COMMERCIAL BREAK) (BEGIN VIDEO CLIPS) SEN. HARRY REID (D-NV), MAJORITY LEADER: McConnell, Boehner, Romney, Gingrich all say they favor extension of the payroll tax cut. They have a funny way of showing it. SEN. CHARLES SCHUMER (D), NEW YORK: We`re going to stay here as long as it takes to get this p done. We prefer to negotiate and come up with a bipartisan agreement that includes the tax break for the middle class. But if they won`t agree to that, we will stay here until Christmas and even to New Year`s to get it done. There`s some talk that Speaker Boehner next Wednesday will throw us some kind of proposal and go home. Don`t go home, Speaker Boehner, because we`re going to be here and you`ll be embarrassed before the American people. (END VIDEO CLIPS) MADDOW: When it gets to be Christmastime in Washington, sooner or later, we get down to the part where everybody threatens that they`re going to work through Christmas. Today, we got that threat from Senate Democrats. And according to them, we got that threat from the president as well. Majority Leader Harry Reid saying President Obama will not join his family in Hawaii as long as his tax cut extension remains unresolved over the holidays. On the one hand, this is an old story. Does the president get to take Christmas off? Or does the president and does Congress have to stay here in Washington because of a fight about taxes? On the one hand, that`s an old story. On the other hand, though, this year this is not a very old story. This year, it`s sort of a weird story, because what Democrats are fighting to do this year is cut taxes. And what Republicans are fighting to do this year is effectively raise taxes. Leading congressional Republicans like Arizona Senator Jon Kyl say they are frankly not all that psyched to extend a tax cut for working people. It`s the payroll tax cut that comes out of your paycheck. If you`re one of the poor saps who is not a monopoly zillionaire and who therefore has no other source of income beside your paycheck. The Republicans here in Washington are off-message on this issue by their own account. They want to be seen as the party that is for lowering taxes, not for raising them. So in a series of rather rollicking campaign- style appearances recently, President Obama has tried to turn up the heat on Republicans for that, turning up the heat on Republicans for only wanting to lower taxes when it`s rich people`s taxes. The president painting the Republicans as prioritizing the interests of the rich over the interests of everybody else. (BEGIN VIDEO CLIP) BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I know many Republicans have sworn an oath never to raise taxes as long as they live. How could it be that the only time there`s a catch is when it comes to raising taxes on middle class families? How can you fight tooth and nail to protect high- end tax breaks for the wealthiest Americans and yet barely lift a finger to prevent taxes going up for 160 million Americans who really need the help? The market will take care of everything, they tell us. If we just cut more regulations and cut more taxes, especially for the wealthy, our economy will grow stronger. Sure, they say, there will be winners and losers, but if the winners do really well, then jobs and prosperity will eventually trickle down to everybody else. It`s a simple theory. And we have to admit, it`s one that speaks to our rugged individualism and our healthy skepticism of too much government. That`s in America`s DNA. And that theory fits well on a bumper sticker. But here`s the problem: it doesn`t work. It has never worked. (APPLAUSE) (END VIDEO CLIP) MADDOW: The president going after the core of how Republicans think about the economy and talk about the economy -- the president doing it in the very, very deep red state of Kansas this week. That`s the politics of the matter. And politics of the matter goes hand in hand right now with an accompanying policy. (BEGIN VIDEO CLIP) OBAMA: For the first time in history, the reforms that we passed put in place a consumer watchdog who is charged with protecting everyday Americans from being taken advantage of by mortgage lenders or payday lenders or debt collectors. And the man we nominated for the post, Richard Cordray, is a former attorney general of Ohio who has the support of most attorney generals, both Democrat and Republican, throughout the country. Nobody claims he`s not qualified. But the Republicans in the Senate refuse to confirm him for the job. They refuse to let him do his job. Why? Does anybody here think that the problem that led to our financial crisis was too much oversight of mortgage lenders or debt collectors? Of course not. (END VIDEO CLIP) MADDOW: That vote on Richard Cordray, on the man who would be the head of the new Consumer Financial Protection Agency, that vote is scheduled for tomorrow here in Washington. Republicans are expected to filibuster it. The president`s top economic adviser joins us next. (COMMERCIAL BREAK) (BEGIN VIDEO CLIP) OBAMA: Consumers deserve to have someone whose job it is to look out for them. And I intend to make sure they do. (END VIDEO CLIP) MADDOW: Joining us now is Gene Sperling, director of the National Economic Council and assistant to President Obama for economic policy. Director Sperling, thank you for being here. GENE SPERLING, DIRECTOR OF NATIONAL ECONOMIC COUNCIL: Thanks for having us. MADDOW: This most recent fight over the Cordray nomination has been covered to suggest -- in such a way that suggests that Republicans in the Senate are not so much opposed to him as the nominee. They`re opposed to anybody running this agency at all. Would anybody have a chance? Or is the problem with agency, itself, politically speaking? SPERLING: Well, I think people have had a hard time marshalling any criticisms against him. As you know, even Republican attorney generals have supported him. He has a tremendous record as attorney general of Ohio. So, I think this is really a philosophical debate the Republicans are having. And it`s so wrongheaded in terms of the lessons we`ve just learned. If there`s one thing we should have learned from this financial crisis is you do not want to have financial supervision where a whole host of institutions that are dealing with average people have a hole where they don`t have supervision. That`s exactly what they`re doing. The way the law was created is that our new consumer watchdog cannot regulate so-called nonbank institutions -- meaning payday lenders, credit institutions, debt collectors. They cannot regulate or supervise any of them until there is a director. So every day they hold this up, even while small community banks are playing by the rules, you`ve got a so-called installment lenders preying on the families of veterans, charging them, seriously, 300 percent interest rates over a year. And we cannot do anything about it simply because they refuse to put any director in the place. MADDOW: The agency has been doing some work even in the absence of a director. New credit card agreements are being piloted to make things easier for people to understand, so you understand the interest rates and late fees you`re signing up for when you sign up for a credit card. What else can they do if they don`t get a director anytime soon? SPERLING: Well, they can regulate certain institutions and can regulate banks and they are doing excellent things. For example, making it more transparent and clear what`s on your credit card, what the fees are. Those are positive things they`re doing. But remember, part of the reason we had the entire financial crisis was that there turned out to be a whole group of, quote, "nonbank institutions" that were out there manipulating consumers on all sorts -- in all sorts of ways. And they were completely not subject to supervision or regulation. So to now, in this environment, recreate that, so that you can have a payday lender, somebody who`s not a bank, taking advantage of veterans` families, of typical Americans in an assortment of ways and there`s nothing we can do about it is literally recreating exactly what was one of the fundamental holes in our system that led to our financial crisis and to a lot of pain for millions of families. MADDOW: One of the reasons that Americans know about this Consumer Financial Protection Agency is not just because the administration spent a long time talking about it, but because it was championed by Elizabeth Warren, a very high profile progressive now running for Senate in Massachusetts. One of the things Republicans have proposed is rather than having a director of the agency, there`d be a council of five people that would be running it. What`s behind that idea and what you think of it? SPERLING: That seems like a way simply to stall, block, delay. This is the law. You know, today, a Republican attorney general from Utah came to the White House and had a very crisp message to his own party, which is if you don`t line the law, change it. But we have a law. It just passed. It went through our democratic process. It is designed to prevent the types of financial manipulation and abuse of ordinary Americans and it is being held up by not having a director. This director is subject to a lot of supervision and review by -- as much as any agency had. We decided -- Congress decided to pass a law, to have a director and they refused to put them in. And every day that happens, every day that happens, there are thousands of Americans who are going to be taken advantage of simply because they will not implement this law that was just passed last year. MADDOW: You described the fight over this consumer agency, as being - - at its root, a philosophical difference between the parties about whether or not this sort of protection exists. SPERLING: That`s the kind interpretation. There`s no question what else is going on. There`s an intense lobbying effort going on. That was one of the things the president spoke very powerfully to in Kansas, which is that -- you know, that there`s a trust deficit with our financial institutions. We believe very strongly they should be going the extra mile to embrace these reforms, to help close that trust deficit. Not spending money on lobbyists here, trying to stall or undo the reforms. So I can`t tell you exactly why the Republicans are doing what they`re doing in stalling and delaying somebody who has such a high and strong reputation, Richard Cordray. I can tell you what the impact is. And the impact is terrible. And, again, you know, we`ve seen this with veterans` families as well as ordinary families. People have set up these so-called installment loans. People are vulnerable situations. They`re come to a new town, a new base, and what happens? They get a loan. And I`m -- this is serious. These loans are often at a rate over a year that would average about 300 percent to 400 percent. That`s what we let continue to happen every day that we don`t confirm Cordray and put him in as a director of our new consumer watchdog. MADDOW: One of the things the president raised in that speech in Kansas was the behavior of banks toward homeowners right now, even this far into the crisis, and even after they were bailed out -- even after TARP. The president is saying that the administration wants to continue to pressure banks to essentially give homeowners a break, to give them more time, to give them more flexibility, to try to stay in their houses instead of being foreclosed on. Do you regret, or is there regret within the administration that that sort of pressure wasn`t made a condition of the bailout? That banks weren`t forced into essentially making more favorable arrangements with the real American families that were hurt by their behavior, as a condition of being bailed out by the government? SPERLING: Well, I think, we were dealing with the situation in a time of enormous crisis. You know, in the first quarter when President Obama came in, our country had been losing growth at 8 percent. Stock market was under 6,400. We had a crisis situation to stabilize the banks. But I think through the financial reform we`ve put in place, we can make a big difference. And we are doing things every day to try to get banks to do a better job in helping ordinary families. You know, I`ll give you an example. Earlier this year, we put forward successfully a measure to say if you`ve been unemployed up to 12 months, you can have forbearance. It doesn`t mean you get a gift. It just means for 12 months you don`t have to pay your mortgage while you`re unemployed looking for a job. And then that amount just gets shifted on to your future mortgage. Now, for a family who finds their job, unemployed family where they find their job in the eighth month as opposed to the four months, that can mean the difference in whether they lose their house or not. Now, that`s an example of something we were able to do. But we only through our administrative action can effect 10 percent, 15 percent of the loans in those situations. Why not have other banks just step up and say, we want to be part of that? We put forward a new foreclosure -- we put forward a new refinancing proposal that calls for swifter refinancing that could save $3,000 a year for many families. Could make a big difference between whether people can stay in their house or stay out of their house. We`re putting forward servicing golden rule standards of what`s the best way to deal with people. We should have an ethic throughout the country that anyone who can stay in their home has a chance to. And finally, there`s no question there have been enormous amounts of terrible abuses in the servicing, on the foreclosure. And, again, we think what the banks should do is embrace remedying those issues, not fight, not resist. That`s what the president was trying to push in Kansas. MADDOW: When I see people out occupying foreclosed homes and trying to stop evictions and stop foreclosures right now, I think about you and I think about your job and how important the leverage and the bully pulpit of the White House is right now at a real moment of moral crisis over this stuff. So, thank you for doing the hard job you do and thanks for talking to us. Appreciate it. SPERLING: Thanks for having us. MADDOW: Thanks. Nice to see you, Mr. Sperling. All right. Gene Sperling is the director of the National Economic Council and he`s, of course, assistant to the president for economic policy. All right. Candace Gingrich will be here to talk about her brother, Newt Gingrich. We got a lot more just ahead. Stay with us. (COMMERCIAL BREAK) MADDOW: We learned something fascinating this week about Republican presidential front-runner Newt Gingrich. It turns out that`s not his name. Newt Gingrich not actually his name. Let us set the way back machine to 1995 when the country was just getting to know him. (BEGIN VIDEO CLIP) MARION ALEXANDER, GINGRICH FAMILY FRIEND: The house behind me is where Newt Gingrich lived during his early years. REPORTER: I have to ask you, because in Washington we always pronounce the last name Gingrich and you`ve been saying Gingrich. What`s the difference? ALEXANDER: Well, it seems like, when he was growing up here, his father`s name was Gingrich. Of course his name was Gingrich. It seems like when he went to the South, it became Gingrich. (END VIDEO CLIP) MADDOW: Thanks to Dylan Buyers (ph) of Politico.com for unearthing the C-Span nugget from 1995. We reached out to the Gingrich campaign to verify whether the family friend was right about his last name and we`ve been saying it wrong. We got the following reply, quote, "Sorry can`t be helpful." It`s nice they replied even if they couldn`t help. We did, however, thereafter, get some help on the Gingrich/"Gingrick" thing, from somebody who knows. It`s his sister, Candace, who joins us for the interview, next. (COMMERCIAL BREAK) MADDOW: Last night on CNBC, Newt Gingrich said that he is the reason Mitt Romney is a rich guy. Mitt Romney ought to say thank you to Newt Gingrich for making him rich. (BEGIN VIDEO CLIP) GINGRICH: You can make an argument that I helped Mitt Romney get to be rich because I helped pass the legislation. (CROSSTALK) UNIDENTIFIED MALE: -- from Bain Capital. GINGRICH: He should be thanking me because I did the macroeconomic things necessary to make his career possible. (END VIDEO CLIP) MADDOW: I made you, Mitt Romney. You should thank me. Newt Gingrich talks like this. This is way he describes himself and describes himself a lot. In January of 1994, "The Atlanta Journal Constitution" published an interview with the eight-term congressman titled, quote, "Gingrich to Save America." Mr. Gingrich told the paper, "People like me are what stand between us and Auschwitz." Mr. Gingrich went on, quote, "I see evil around me every day." Quote, "We are at the edge of losing this civilization." Quoting from somewhat agog "Atlanta Journal Constitution" at the time, quote, "Like many of the larger-than-life figures this former history professor has studied and admired, Mr. Gingrich says his destiny is to save modern American." After proclaiming to "The Atlanta Journal Constitution" his important role in keeping America free of Nazi concentration camps and holding together civilization and whatnot, he went on to lead his party in a huge lopsided victory in that year`s midterm elections and to become speaker of the House in 1995. When he was eventually reprimanded as speaker by the House Ethics Committee, one of the things the committee released in their report on him, was a note in Mr. Gingrich`s handwriting that read in part, "Gingrich -- primary mission. Advocate of civilization. Definer of civilization. Teacher of the rules of civilization." And, "leader, possibly, of the civilizing forces." Possibly. Don`t sell yourself short. When Mr. Gingrich decided to get into the 2012 presidential race, he told the "Associated Press" in May, quote, "It`s going to take a while for the news media to realize you`re covering something that happens once or twice in a century." More recently, he said of his campaign comeback, quote, "This is like watching Sam Walton or Ray Kroc develop Wal-Mart and McDonald`s." This is how he talks about himself, all the time. It`s how he explains when things are going well. It`s how he explains when things are not going well. (BEGIN VIDEO CLIP) GINGRICH: Because I am much like Reagan and Margaret Thatcher, I`m such an unconventional political figure that you really need to design a very unique campaign that fits the way I operate and what I`m trying to do. I helped Ronald Reagan and Jack Kemp developed supply side economics. I helped lead the effort to defeat communism in the Congress. (END VIDEO CLIP) MADDOW: Duh! And that is why we don`t have a communist Congress anymore. That`s why Mitt Romney is rich. Newt Gingrich as a congressman, as speaker of the House and now as a candidate for president has nothing but wonderful things to say about Newt Gingrich. Just running for president, itself, just thinking you have what it takes to be in charge of the country means you probably think a lot about yourself and your capabilities. They all do. But Mr. Gingrich seems to really think a lot of himself. So, tonight, we are joined for the interview by a specific type of Newt Gingrich expert -- his half sister Candace Gingrich-Jones who`s a gay rights advocate. And she has publicly clashed with her brother politically over the years. She`s the associate director of youth and campus outreach for the Human Rights Campaign foundation which works to advance gay rights. Candace, thanks for being here. CANDACE GINGRICH-JONES, HUMAN RIGHTS CAMPAIGN: Happy to be here. Thank you, Rachel. MADDOW: Nice to have you here. I wonder listening to those quotes from your brother talking about himself, I`m obviously making the point that he thinks of himself in grand sweeping historic terms and that`s important to understanding him. Do you -- when you hear that, do you feel affectionate about that? Is there a side of him as a family member that makes sense about that than what makes sense to us knows him as a politician? GINGRICH-JONES: Well, yes and no. You know, we did not grow up together. So, as far as, like, you know, what makes him tick or what molded him, I don`t know. But he is running for president, takes some amount of ego to do such a thing and he`s never put himself out there as anything but someone who wanted to, quote-unquote, "save the country." His reasons for thinking the country needs saving, most people disagree about, but that is who he is. MADDOW: Did you -- did you foresee this? Did you think at any point that he`d be the front-runner for the Republican nomination? Did you think it would be happening at this point in his life? GINGRICH-JONES: Well, he`s definitely kind of person who when he puts his mind to something will do everything in his power to make it happen. I can`t say that if you would ask even a month ago if I thought he would be a frontrunner, that I would think so. You know, slow and steady wins the race and he didn`t let some of the things that crushed other people`s campaigns early on get to him. MADDOW: Yes. When he was, I think, the best-known politician in the countries who name wasn`t Bill Clinton, when he was speaker of the House and such a high- profile speaker of the House, you did not hesitate to take public stands against him when he did things that you disagreed with, particularly on gay rights issues. I always wondered if that hurt your relationship if that -- how that affected you moving forward just in terms of your personal relationship? GINGRICH-JONES: No, not at all. I mean, I think we`ve always been mutually respectful of each other and our abilities and, you know, desires to change the world. You know, I think what it does harm is just that when there are family times together, you know, to really focus on the family aspect of it and, you know, remember that at the end of the day, we are a family and that`s important. The -- you know, the catch is that, you know, when we leave the dinner table or leave the Christmas gathering, you know, he and Callista still have way more rights than my wife, Rebecca, and I do. MADDOW: Well, he did make a political point of saying on "Meet the Press" at one point that if you ever got married, that he would not go to the marriage, he would not go to the ceremony. I understand that that`s the case that he didn`t go. You invited him? GINGRICH-JONES: He was invited. Yes. Yes, absolutely we invited he and Callista. They happen to be on some other continent on the day of the actual ceremony. So -- MADDOW: Yes, is that hurtful or -- GINGRICH-JONES: Well, we still got a gift. MADDOW: Was it from Tiffany`s? GINGRICH-JONES: I`m not at liberty to say. MADDOW: Very discreet. Well done. Rick Perry today started trying to salvage his desperately flailing campaign, particularly in Iowa, by running very explicitly anti-gay ads saying the reason he should be elected president is because it`s wrong that the country repealed "don`t ask, don`t tell" and because the recent moves by the Obama administration on tying gay rights and foreign aid, those are wrong and they are insults to religious people in this country. I think that`s -- I`m less interested in Rick Perry`s opinion on those matters than I am in the fact that he thinks that is a way to get ahead. If push came to shove, do you think that we should expect from Mr. Gingrich, as a front-runner, that he would really push the gay issue if he had to do it? GINGRICH-JONES: I wouldn`t put it past any of the GOP presidential candidates. It has historically been one of the things that -- a tactic that`s used. You know, LGBT Americans and their lives and kind of how we should be treated or how we should be accepted or -- MADDOW: But having a gay sister doesn`t affect a politician`s willingness to do that? GINGRICH-JONES: You know, I -- I don`t know the answer to that. Like I think that if he is a politician and saying these things because he`s politician, but he doesn`t believe them, or if he does believe them, I don`t know if I like either of those answers very much, you know? I know at the end of the day, he is wrong. He is on definitely the wrong side of history when it comes to those issues and it is those positions that, you know, the Human Rights Campaign and myself are going to work really, really hard to make sure that President Obama is re-elected next year, no matter who the Republican candidate is. MADDOW: So, if your brother wins the Republican nomination, you will not be supporting his candidacy? GINGRICH-JONES: No, and I don`t think he has any misconception that I might be. MADDOW: If he calls you and tries to lobby you for your vote, please, can I be in the room? (LAUGHTER) GINGRICH-JONES: I`ll see what I can do. MADDOW: All right. Also, Gingrich or Gingrich? GINGRICH-JONES: Gingrich. MADDOW: All right. That will be what it is from here on out. Candace Gingrich-Jones, associate director of youth and campus outreach for Human Rights Campaign foundation and the sister of Newt Gingrich -- thank you very much for joining us tonight. Nice of you to come talk us. I know you don`t have to do it. GINGRICH-JONES: No, thank you for having me. It was an honor. MADDOW: Nice to meet you. GINGRICH-JONES: You, too. MADDOW: All right. We will be right back. (COMMERCIAL BREAK) MADDOW: Meanwhile, elsewhere in politics, Rod Blagojevich, Democratic former governor of Illinois, was sentenced today to 14 years in federal prison being found guilty on 17 felony corruption charges. Blagojevich was impeached and removed from office in 2009, but in criminal court, among other bleeping outrages, the governor was convicted of trying to sell an appointment to the United States Senate seat that was vacated when then- Senator Barack Obama became President Obama. Mr. Blagojevich is the fourth Illinois governor, the fourth one, to get sent to prison in the last 40 years. And also, meanwhile, the Food and Drug Administration`s decision to make Plan B available over the counter without a prescription has been blocked by the secretary of health and human service, by Kathleen Sebelius. Plan B is an emergency contraception you take after sex to reduce the chance of pregnancy. Plan B is available now over the counter to women over the age of 17, but if you are younger than that you need a prescription. Since you really ought to take this within a day or two, having to get a prescription for this effectively means you can`t really use it effectively at all. The FDA wanted to change that. They say all reputable studies and experts agree that it is safe for plan b to be available over-the-counter to anyone, but the Obama administration has blocked that recommendation today. And meanwhile, meanwhile, you remember yesterday, we reported that the State Department had opened a new fake or rather online embassy in Iran? We do not have an actual physical embassy in Tehran because -- well, for obvious reasons. But yesterday, as we reported on this show, the State Department launched a new English and Farsi language Web site so Iranians could get information about U.S. policies and about traveling to the United States, all the sorts of things that an embassy normally does when it exists in bricks and mortar. We were just going to do it online. So finding out about the online embassy, that was yesterday. Launched yesterday. Today, that new virtual U.S. embassy Web site was blocked inside Iran. Shocker. Still though at least we are trying to. That does it for us tonight. We will see you again tomorrow from back home in New York City. Now, it is time for "THE LAST WORD" with Lawrence O`Donnell. Have a great night. THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED. END