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The Rachel Maddow Show, Transcript 8/10/17 Financial connections of Paul Manafort

Guests: Greg Farrell, Sue Mi Terry

Show: THE RACHEL MADDOW SHOW Date: August 10, 2017 Guest: Greg Farrell, Sue Mi Terry

RACHEL MADDOW, MSNBC HOST: And thanks to you at home for joining us this hour.

There`s lots going on tonight.

Before we get started with some of the news that has been breaking late into this evening, including new news about the Russia investigation, about the president`s former campaign chair, about the legal trouble he appears to be in, we`re going to be getting to that news in just one second, including with an investigative reporter who broke some of that news today.

But before that, I want to start off a little different tonight. I want to raise one quick point of order on the North Korea story that we`ve all been talking about, that everybody has been following all day and into tonight. I expect it will be the main story in the news tomorrow and tomorrow night as well.

We`ve got a really important guest here tonight on that subject. For years, she was the senior Korean analyst and a senior linguist at the CIA. She has a tremendous amount of practical experience in terms of dealing with North Korea and the development of their nuclear program and their missile program. So, we`re going to be joined by her here in studio later on in the show tonight for the interview. We`re going to be able to talk about this in more detail once she`s here.

But as I said, I just -- I just want to stick one pin in one point before we get there, and before we get to the other news of the day. Because we have now, with the president`s remarks at his golf club today, we`ve gone through a second day of the president further escalating basically his overt threats of war against North Korea. And this is obviously a scary thing. It`s an unusual thing.

But here`s the point of order that I want to raise. Why exactly is this happening right now? And I don`t mean like in an existential sense. Like what have we done to bring this upon us?

No. I mean specifically. What exactly happened to spark this huge change in policy, these unprecedented threats in the last few days, this huge change in America`s stance toward North Korea and its potential as a military threat? What started this?

In the immediate specific sense, why is the president now threatening war against North Korea? Where did this come from?

I mean, North Korea first tested a nuclear weapon 11 years ago, in 2006. In the ensuing decade, they have had another four nuclear tests after their first one. So there have been five nuclear tests in total over the last 11 years.

Last year, North Korea did 24 different missile tests. This year, they`ve done 18 or 19 different missile tests already. So, you know, whether or 

not any of that is particularly terrifying, none of it is new.

I mean, the missiles they`re testing are getting longer and longer range which does mean their ability to hit farther flung targets could potentially at least be advancing if these longer range missiles they`re testing could survive re-entry and hit the target and be loaded with a warhead and all of that stuff. Right.

But all of this stuff in terms of them testing missiles and stuff, this has been happening gradually over time. So, again, what is it about these last couple of days that suddenly has made the U.S. government, the U.S. president, start threatening war in the most bellicose terms possible against North Korea?

North Korea`s last missile test was two weeks ago. Why didn`t we start threatening nuclear war against them then? Why did it start this week?

The reason it appears to have started this week is because of this article from "The Washington Post" on Tuesday. That article described a confidential assessment by one U.S. intelligence agency which reportedly concluded that North Korea had miniaturized a nuclear device and could now fit one onto a missile.

That "Washington Post" story came out on Tuesday. Since then, the president has been making the over the top, bellicose, obliterative, overt threats against North Korea. But the basis of that "Washington Post" report, whatever the intel was that was the basis for "The Washington Post" story, it has not come to light.

We had some vague assurances today from the director of intelligence and from the CIA that there may be vague agreement within the intelligence community on this issue, but there`s been no publication of any findings. There`s been no formal assessment that we know has been made of these matters.

We certainly don`t know of anyone that`s been made public. We haven`t heard of one being provided in a classified setting. No other intelligence agencies other than the one, other than the Defense Intelligence Agency, the DIA, has apparently done a report on this issue.

And so, point of order, right? These last three days of literally nuclear brinksmanship, as far as we can tell, the proximate cause of this, what set it all off is one newspaper report of a single agency`s reported conclusion, which has not been bolstered by other sources, that doesn`t reflect any sort of formal stated view of the intelligence community.

And you know that one agency that supposedly produced this intel that started this whole thing this week? That particular intelligence agency has been wrong on this exact subject before. We talked about this on Tuesday night. More than four years ago, in the spring of 2013, the Defense Intelligence Agency came and said then in 2013 that they believe North Korea had successfully miniaturized a nuclear weapon so they could put one on top of the missile. 

Maybe this is the same report they issue every four and a half years assuming that we`ll forget they did it before and some day, it will be true. But they have been wrong about this before.

And so, the whole world is on edge about this. It`s been very scary and very distracting to see the way this new president and this new administration has behaved this week toward North Korea since that "Washington Post" report came out. There is something absolutely new in terms of the way the president, our new president is talking about this issue and the kinds of threats that he`s making.

But it is not at all clear that something new has happened in North Korea that might reasonably justify this major change in the behavior of our country. I don`t doubt "The Washington Post`s" reporting. As far as I`m concerned, "The Washington Post" is one of the great wonders of the world. It`s a national treasure at a minimum.

But I think it`s worth noting that these overt, scary threats of war that we`re now getting from our own government are based on unconfirmed, uncorroborated, reported conclusions from a single intelligence agency that notably and very publicly has been wrong on this exact issue before. And when the Defense Intelligence Agency was wrong about this issue in 2013, it didn`t end up being that big of a hairy deal because the Obama administration didn`t take it and run with it and say, oh, this one intelligence agency says something. That`s a reason to suggest that we`re going to start World War III.

No, they reacted to it by saying that`s just one agency, not the view of the intelligence community. And if you ask us for a unified view from our government, no, we do not believe that is true. This time, though, it`s the exact same agency putting out the exact same conclusion again basically on their own, and we`re having a completely different response.

This time, the ratio between the size of that catalyst and the size of the administration`s response is a very, very, very, very, very large ratio. This existential dread and worry that we have been experiencing, that the world has been experiencing about this stuff between our president and the North Korean leadership, the threatened potential start of war, it`s all based on intel we have never seen that apparently doesn`t have any backup from any other U.S. intelligence agencies or any other countries.

So, again, we`ll be talking in detail with somebody who has real earned expertise on the North Korea issue later on in the show tonight. But as we continue to watch the threats and the bluster and the chaotic kinetic activity from this administration on North Korea, I just think it`s worth noting that we have no idea whether the radical change in behavior by our own government is actually based on anything real.

So, I just wanted to put that at the top of the show. Stick a pin in that. We`re coming back to that a little later in the show tonight.

But, as we were getting ready to start the show tonight, there was a flurry of news about the Russia investigation. We`re going to have a special report on tomorrow`s show about why President Trump at a personal level, why he might be particularly nervous about the turn the Robert Mueller special counsel information seems to be making toward investigating banking 

and business practices and financial transactions. We`re going to have a special report on the president`s particular concerns about the investigation taking that turn. If you were not planning on watching tomorrow night`s show because you had like a hot Friday night date or something, here`s your fair warning that maybe you`re going to be washing your hair instead.

You just make it a Saturday night date or something. I will write you a note. We`re going to have the special report tomorrow basically on why there is a big uh-oh for the president himself with things turning towards finances.

Today, of course, "Bloomberg" reported that the special counsel headed by Robert Mueller, that investigation is absolutely going down the financial and banking path when it comes specifically to Trump`s campaign chairman Paul Manafort. Quoting from the "Bloomberg" report, Mueller`s team of investigators has sent subpoenas in recent weeks from a Washington grand jury to global banks for account information and records of transactions involving Manafort and some of his companies.

We`re going to be talking with Greg Farrell, one of the investigative reporters from "Bloomberg" who broke that story today about what those subpoenas mean and what Paul Manafort`s options may be in terms of responding to those or not.

The pressure on Paul Manafort right now we know must be intense. Last night, reported that the Mueller investigation was squeezing one of Paul Manafort`s family members, his son-in-law, with an eye toward getting his son-in-law to become a cooperating witness against his father- in-law, Paul Manafort. Today, CNN follows up that reporting with news that Paul Manafort`s son-in-law has in fact met with federal prosecutors on these issues and that, of course, comes on the heels of news first broken by "The Washington Post" that the FBI launched a predawn raid at Paul Manafort`s home in northern Virginia.

Now, the president himself was asked about that FBI raid today, and he gave a response that -- not even within hours, within minutes started to factually fall apart.


REPORTER: Mr. President, was it appropriate for the FBI to raid the home of Paul Manafort predawn?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I thought it was a very, very strong signal or whatever. I know Mr. Manafort -- I haven`t spoken to him in a long time, but I know him. He was with the campaign for a very short period of time, relatively short period of time.

But I`ve always known him to be a good man. I thought it was a very, you know, they do that very seldom. So I was surprised to see it. I was very, very surprised to see it. 

REPORTER: Have you spoken with the FBI, sir?

TRUMP: We haven`t really been involved.


MADDOW: We haven`t really been involved.

So, the president kind of minimizing the role of his campaign chairman in the campaign saying, yes, you know, for a short period of time he was running my campaign. And then saying about this raid, oh, you know, we haven`t really been involved.

The president made those remarks today in the 4:00 hour Eastern Time. At 5:03 p.m. Eastern Time he was proved very dramatically wrong in that assertion. At 5:03 p.m., "The Wall Street Journal" published this story, see the headline there, "Trump attorney calls FBI`s raid on Manafort`s home a gross abuse."

While the president was declaring that we have no involvement whatsoever in whatever is going on with Paul Manafort and this FBI raid. While the president was declaring that, "The Wall Street Journal" was busy uploading this story, letting the cat out of the bag that despite what the president was saying about we have no involvement in this, in fact, the president`s lawyer, a man who is apparently serving as his lead attorney on Russia matters, John Dowd, he`s absolutely involved in Paul Manafort and specifically on that question of the FBI raid that was carried out in conjunction with Bob Mueller`s investigation.

Apparently at 3:48 in the morning this morning, the president`s lawyer John Dowd was up and sending misspelled e-mails to "The Wall Street Journal", ripping that FBI raid, ripping Bob Mueller and making all sorts of legal allegations and legal threats about the Mueller investigation and the FBI`s treatment of Paul Manafort.

Quote: This extraordinary invasive tool was employed for its shock value to try to intimidate Mr. Manafort and bring him to his needs. According to "The Wall Street Journal," the president`s attorney then said that the raid on Manafort`s home was extraordinarily invasive and a gross abuse. He alleged that the FBI, quote, seized privileged and confidential materials prepared for Mr. Manafort by his counsel to aid him in his cooperation with the congressional committees.

The president`s lawyer said, quote, these failures by special counsel to exhaust less intrusive methods is a fatal flaw in the warrant process and would call for a motion to suppress the fruits of the search.

So, this is not Paul Manafort`s lawyer sending these complaints. This is the president`s lawyer. This is president Trump`s personal lawyer threatening his motion to suppress the fruits of the raid on Paul Manafort`s house, sending that e-mail just before 4:00 in the morning today warning about Paul Manafort being right to his needs.

I mean, you know, it`s whatever you make about the truthfulness of statements here, this is bad strategy by the president and his legal team.

You shouldn`t have the president making a manifestly different representation of this relationship than the president`s lawyer, right? Paul Manafort is somebody who the president is now calling Mr. Manafort, saying, yes, I think I remember him, trying to claim he was only involved in the campaign for a very short period of time.

The president very clearly trying to distance himself from Manafort, saying explicitly, we have no involvement whatsoever in these Paul Manafort legal troubles with the special counsel and this FBI raid. Well, we know that is not true because the president`s lawyer proves it not to be true.

So, the president`s lawyer and the president being on completely different pages on this very basic issue is a bad sign in terms of what kind of representation the president is getting in terms of his legal representation on this very serious issue. Why is the president`s lawyer weighing in on Paul Manafort`s behalf like this in this angry e-mail to "The Wall Street Journal"? Paul Manafort is not his client. That, too, is a question about the quality of the president`s legal representation.

It`s also an interesting question about Paul Manafort`s legal representation which frankly has always had something a little hinky about it. I don`t want to make too big of a deal out this, but I got to tell you, we saw this coming and now it has fallen apart. In the middle of last month, you might remember a story that we did about this law firm, Wilmer Hale, right?

Wilmer Hale is a big, famous, prestigious American law firm. One of its highest profile partners is -- was Robert Mueller. Robert Mueller left Wilmer Hale, cashed in his partnership there in order to take his job as special counsel.

And Wilmer Hale has gotten itself into a little bit of a quandary around the Russia investigation because there`s Bob Mueller having just left as a named partner of the firm to be the special counsel on Russia while one of Wilmer Hale`s other very high-profile partners, another high ranking government official, is a lawyer named Jamie Gorelick.

For a long time, Jamie Gorelick has been the lead counsel for Jared Kushner in all sorts of different matters, including the Russia investigation. Now, Bob Mueller technically quit his role at that firm in order to become special counsel but that`s still becomes sort of a dicey issue for Wilmer Hale, right? Is it OK if you`re a big law firm to have your highest profile partner and your highest profile former partner working on opposite sides of a major case like this, right? That`s a dicey issue, right? That`s an arguable issue in terms of the legal ethics of that and the practicalities of that.

So, we did a story about this last month. In the middle of last month, in fact, Jamie Gorelick, Jared Kushner`s lawyer, had to step aside as Jared Kushner`s lead counsel on matters related to the Russia investigation. I mean, she continues to represent him on other things. But when it comes to Russia, that conflict because of Bob Mueller`s association with Wilmer Hale, with her law firm, she had to step aside. Let somebody else take other Russia issues for Jared Kushner.

And the whole reason we brought it up last month, I remember saying on the 

air, I`m going to figure this out. This makes no sense. The whole reason that has stuck in my craw and the reason we brought that up on the show is because that problem being settled around Jared Kushner`s legal representation raised a really big question for Paul Manafort. Because Jared Kushner lost his main Russia lawyer last month because of that conflict because she worked at Bob Mueller`s old law firm. That was seen as a conflict.

But you know who else worked at Bob Mueller`s old law firm? Paul Manafort`s lawyer. So, why did Jared have to lose his Russia lawyer because that lawyer worked at Wilmer Hale but Paul Manafort got to keep his Russia lawyer who also worked at Wilmer Hale?

It didn`t make any sense there could be a conflict there for Jared but not for Paul Manafort. It never made any sense. I`m going to figure this out.

Today, we figured it out. Today, those pieces all either fell into place or fell apart, depending on how you look at it. We started to get reports earlier this evening that Paul Manafort`s legal representation was getting a big shakeup.

We actually called Paul Manafort`s attorney at Wilmer Hale, we called Reg Brown, to ask if those reports we were true. He hung up on us.

And then within about an hour, it was official. Paul Manafort has now dropped his lawyer on the Russia investigation. Reg Brown at Wilmer Hale will no longer be representing Paul Manafort on Russia. Instead Paul Manafort has a new legal team representing him on Russia.

One of his lead lawyers has a resume and a list of areas of expertise that gives you a very, very clear indication of what Manafort thinks his representation needs are right now. Manafort`s legal team will now be led by an attorney who spent years as a -- first, his name is Kevin Downing. He spent years as a prosecutor in the tax division at the Justice Department.

Look at the list of his areas of practices. His areas of practice include the Foreign Corrupt Practices Act, tax fraud, violation of the Bank Secrecy Act, mortgage fraud, tax shelter litigation, illegal cross border banking and congressional investigations. It`s like if you created a doll out of spare parts specifically to answer all of Manafort`s potential legal concerns. And I should mention, he`s a certified CPA, which seems smart.

Paul Manafort`s new legal team will include one other prominent lawyer. Do you know the name Clair George? That`s not the lawyer but that`s an important part in understanding who the lawyer is. Clair is very rarely a man`s first name but in this case it is.

Clair George is famous for a decades-long, swash-buckling James bond career at the CIA. But what Clair George is most famous for is the way his career ended. Clair George, in 1992, became the first ever senior CIA official to be convicted of felony offenses for crimes he committed while serving in his position at CIA.

Clair George was the third ranking official at the CIA. He was deputy director of operations when he was charged with multiple felony counts in conjunction with the Iran/Contra affair. Ultimately, Clair George was convicted of perjury and lying to Congress in December 1992.

Here`s the kind of ah-ha moment about that history and Clair George and what`s going on right now. Clair George was convicted in federal court in 1992 on December 9th. His tenure as a convicted felon however lasted only 15 days. Because on December 24th, that same year, 15 days after he was convicted, on Christmas Eve, then President George H.W. Bush pardoned him.

And the lawyer who represented Clair George through that, who saw him through being the highest ranking senior CIA official ever convicted of federal crimes for his actions as a CIA officer but then immediately got him pardoned by the president, that lawyer that saw him through the process is named Richard Hibey and he will be the other tent pole holding up Paul Manafort`s new legal team. Pardons.

The investigative reporter who broke this new news about the kind of legal trouble Paul Manafort and the Trump campaign chair is facing, that investigative reporter is going to join us live in studio here next.



SEN. MARCO RUBIO (R-FL), INTELLIGENCE COMMITTEE: In page six of your testimony you say, the first thing you say is he asked what we could do to, quote/unquote, lift the cloud, the general Russia investigation and you responded that, we were investigating the matter as quickly as we could and there would be great benefit if we didn`t find anything to having done the work well and he agreed.

JIM COMEY, FORMER FBI DIRECTOR: Yes, sir, he actually went further than that. He said, if some of my satellites did something wrong, it would be good to find that out.


MADDOW: If some of my satellites did something wrong, it would be good to find that out. I did nothing wrong, but if my satellites did, you guys should get on them. I wonder who counts as a satellite.


TRUMP: I have always found Paul Manafort to be a very decent man. And he`s like a lot of other people, probably makes consultant fees from all over the place. Who knows? I don`t know. But I thought that was a very - - that was pretty tough stuff to wake him up. Perhaps his family was there. I think that`s pretty tough stuff.


MADDOW: His consulting fees, they`re probably from all over the place. I mean, who knows? I don`t know. Did I mention I barely remember the guy?

Yesterday, we learned that at the direction of special counsel Bob Mueller, the FBI raided Paul Manafort`s home two weeks ago. They seized tax records and banking records. We still don`t know exactly what the FBI was looking for at Paul Manafort`s house or why they felt like they had to go after anything with a search warrant and armed agents instead of just sending a subpoena.

But today at "Bloomberg News", Christian Bertelsen and Greg Farrell reported that Bob Mueller, the special counsel, is apparently going after Manafort`s financial information through multiple means. They report today at "Bloomberg" that Mueller has also subpoenaed multiple global banks to hand over their bank records on Paul Manafort and his businesses and at least one of his business partners.

In addition to those subpoenas, "Bloomberg" also reports that the special counsel has also, quote, reached out to other people, including Manafort`s own son-in-law and a former business partner who happens to be a Putin- inked Ukrainian oligarch, quote, in an apparent attempt to gain information that could be used to squeeze Manafort to force him to be more helpful to prosecutors. Prosecutors have reached out to those other people. Reached out.

You know, an FBI raid, I get. A subpoena, I get. What does it look like when a special counsel reaches out to you? I imagine that is like the hands reaching out from under the bed to grab your ankles if you let your feet dangle too far off the mattress. That`s probably just me.

Joining us now is Greg Farrell, investigative reporter for "Bloomberg News" who broke this story today.

Mr. Farrell, thank you for joining us.


MADDOW: Reaching out. That -- you report on the subpoenas to global banks. I want to ask you about that in detail in just a moment. What does that phrasing mean?

FARRELL: They are squeezing Manafort. They want the get any information on him. The raid two weeks ago was also, if you will, a show of force. They mean business and they suspect there`s something that is actionable there.

And they are basically leaving no stone unturned in order to get the message to Paul Manafort that, you know, they`re serious, and if there`s 

any skeletons in the closet, even not necessarily related to the campaign and Russia last year, they will have them. And therefore, it will presumably pressure him to tell whatever he knows.

MADDOW: So that means they`re asking for informal -- they`re asking for interviews with these people? They`re asking for people to voluntarily hand things over? Do we know if they`re pursuing Paul Manafort`s business partners and for example his son-in-law by subpoenaing them, by putting them under legal pressure?

FARRELL: I think at first, it`s just a request. Do you want to play ball? So, we`ll see where it leads.

MADDOW: OK. Let me ask you about the global banks subpoenas that you asked for. You reported that these subpoenas are demanding account information and financial transaction records that involve Manafort and his businesses.

Do banks have to respond to those subpoenas? There are bank secrecy laws that might shield them in some cases, right?

FARRELL: Yes. But the bank secrecy laws only go so far. If in this case, the Justice Department or a branch of the Justice Department issues a subpoena, then the bank can disclose information that is normally kept secret.

So, the fact that they asked for this information and the information of one of his partners, Rick Gates, was significant because he and Gates did a lot of business overseas. Gates spent a lot of time overseas. There were lots of transactions back and forth and they suspect that -- obviously, they suspect there`s something worth finding there.

MADDOW: And the rules that govern the American laws, the potential American criminal liability around overseas banking has a lot to do with disclosure, right? Americans are legally obligated to disclose the holding of foreign bank accounts?


MADDOW: And so that any evidence they can find from foreign banks that Paul Manafort hypothetically held foreign bank accounts and didn`t disclose them to American tax authorities, to American banking regulators, that could be potentially criminal leverage?

FARRELL: Well, yes. If not criminal, least leverage. They`re supposed to disclose that, absolutely.

MADDOW: OK. From your reporting on this, and correct me if I`m completely off base with this question, are you able to discern anything about the kind of legal defense and legal representation that Paul Manafort has been getting here? We saw these dramatic changes today in his legal representation.

There`s also these interesting questions as to why the FBI went in and raided his house and whether that followed subpoenas for documents they had trouble getting, why it rose to that level. Are you able to discern anything about the -- how well-matched the two sides are of this legal fight between Mueller`s office and Manafort?

FARRELL: No. Right now Mueller`s operation has been a black box. So, a lot of us, including "The Washington Post", which broke the news of this raid, are getting this from other areas. And so, we don`t know exactly what they`ve got, but we`re trying to piece it together by some of the actions they`re taking and especially something overt like that. So, we`re trying to figure this out as well.

MADDOW: OK. And last question. Am I right to surmise that some of the reason this might be moving fast and we can see all of the moving parts related to Manafort is that some of this investigation might have actually preceded when Bob Mueller came on and started his special counsel investigation?


MADDOW: We`ve seen reports that there was a preceding investigation of Manafort ahead of Mueller getting it.

FARRELL: Absolutely. Manafort has been looked at exactly here in Manhattan and there are lots out there which make allegations against him, and the Ukrainian oligarch and other individuals involving transferring of funds and whether or not something was actually a real estate investment or, you know, being used for some other purpose. So, there`s a lot of material out there in the legal system, allegations that have been raised in civil cases against Manafort.

And the U.S. attorney in Manhattan, up until Mueller came along, was pursuing one angle of that.

MADDOW: And then the lead prosecutor from that office pursuing that went to join Mueller`s team?

FARRELL: No -- well, yes, the lead public corruption guy, absolutely, joined Mueller`s team. Mueller has a lot of people from Brooklyn, a lot of people from D.C., and, yes, the lead prosecutor for public corruption from SDNY.

MADDOW: Greg Farrell, investigative reporter from "Bloomberg News", I can see dots connecting every time I talk to you. Thank you very much for helping us understand it.

FARRELL: Thank so much. Appreciate it.

MADDOW: I really appreciate it.

All right. Much more to come tonight. Stay with us.


MADDOW: Russia recently kicked out 755 people who were associated with American diplomatic facilities inside Russia, 755 people.

Today, President Trump responded with fury to that action by President Vladimir Putin.


REPORTER: Mr. President, do you have any response to the Russian president expelling 755 workers from our embassy?

TRUMP: No. I want to thank him because we`re trying to cut down on payroll, and as far as I`m concerned, I`m thankful that he let go of a large number of people because now we have a smaller payroll. There`s no real reason for them to go back. So, I greatly appreciate the fact that they`ve been able to cut our payroll for the United States. We`ll save a lot of money.


MADDOW: I`m sorry. I screwed that up. I said that the president responded with fury. I actually just misread that in my notes. What I was supposed to say is his response was furry. Not fury. Like less mad, more cute.

I want to thank him for helping us out. I mean, admittedly, it`s hard to know if maybe the president is kidding. It`s hard to know what`s a joke on foreign policy from the new administration. What should be taken seriously?

I mean, on foreign policy matters, theoretically, one of the ways you`re supposed to check to see what the administration really means is to ask the U.S. State Department. Like, for example, on this North Korea crisis, you might ask the U.S. State Department, you know, which of the statements made by the president and the administration on this issue is actually operative as U.S. policy? You might go to the State Department top officials on the subject and ask them. You might do that if there was anybody there to ask.

Senator Brian Schatz today tweeting this picture that`s just one of 11 pages of job openings at the State Department right now. Jobs that have been filled. No nomination, no nomination, no nomination.

That said, at least we do have a secretary of state in place. So, maybe from him at least we can get an explanation of what the administration really means on this incredibly tense situation.


REX TILLERSON, SECRETARY OF STATE: I think Americans should sleep well at night. I have no concerns about this particular rhetoric of the last few 



MADDOW: Nobody else works at the State Department, but at least we`ve got a secretary of state who undoubtedly can speak for the administration on a serious issue like this, right?


SEBASTIAN GORKA, WHITE HOUSE ADVISOR: You should listen to the president. The idea that Secretary Tillerson is going to discuss military matters is simply nonsensical.


MADDOW: A White House adviser who nobody really knows what his job is, still, though, works at the White House, saying don`t listen to the secretary of state on these issues. That left the State Department itself to try to clean it all up.


HEATHER NAUERT, STATE DEPARTMENT SPOKESPERSON: I think that everyone has clearly heard what Secretary Tillerson`s forceful comments have been and continue to be on the issue of DPRK and other countries as well.

REPORTER: And they should be paid attention to?

NAUERT: I would think so. Yes.

He`s a cabinet secretary. He`s fourth in line to the presidency. He carries a big stick.

REPORTER: And Dr. Gorka is where in that line of succession?

NAUERT: I don`t work with Sebastian Gorka. I have known him from a previous life and a previous career, but I have not spoken to him about the comments that he made. And let me just leave it at that. OK?


MADDOW: Please, let me leave it -- please, just -- I`m going to leave it at that. OK. OK. So that was reassuring.

And talk about reassuring, imagine how the people of Guam feel. Yesterday, Secretary of State Tillerson was on his way to Guam, scheduled to be on the ground there for a refuel when a reporter on board the plane asked him, hey, North Korea is threatening to shoot missiles at Guam. Did you think about maybe rerouting?


TILLERSON: Well, look, the North Korean missile capability can point in many directions. So, Guam is not the only place that could be under threat. No, I never considered rerouting the trip back. I do not believe there is any eminent threat in my own view.


MADDOW: I do not believe there is any imminent threat in my own view, says the secretary of state, following a little more than 24 hours later by this from the president.


TRUMP: If he does something in Guam, it will be an event the likes of which nobody has seen before, what will happen in North Korea.

REPORTER: And when you say that, what do you mean?

TRUMP: You`ll see. You`ll see. And he`ll see.


MADDOW: You`ll see whenever he does whatever he`s going to do to Guam.

I mean, so, this is funny at one level, right? I mean, not funnily ha-ha. It`s at least funny surreal. But it does leave us with a real question.

Obviously, this is ridiculously chaotic from what`s supposed to be the world`s most powerful country, the leader of the free world, right? It`s ridiculously chaotic and incoherent.

How dangerous is it, though, specifically on this crisis?

Tonight, we have somebody to talk to who can give us some answers on that front. We`re lucky to be joined by somebody who spent years studying exactly this, career intelligence analyst at the CIA. We`re going to talk with her here live, next.

Stay with us.


MADDOW: Sue Mi Terry is now senior research scholar at the Columbia University Weatherhead East Asian Institute. She was a career intelligence officer. She served at the National Intelligence Council, and in the Office of the Director of National Intelligence.

She was the director for Korea, Japan and Oceanic Affairs at the National Security Council. For years, she was also a senior analyst on Korean issues at the CIA and a senior linguist at the CIA.

Dr. Terry joins us tonight for "The Interview" because she is exactly the 

person I want to talk to.

Thank you so much for being here tonight.

SUE MI TERRY, FORMER CIA ANALYST: Thanks for having me on again.

MADDOW: I really appreciate your time.

Let me ask about a concern that I raised at the top of the show tonight that I am totally willing and able to hear you tell me I`m completely off base about.


MADDOW: Just want to tell you my concern. I feel like we`ve seen a radical change in behavior from our own president in the last 72 hours that appears to be based on "The Washington Post" report that came out on Tuesday, which cited a Defense Intelligence Agency finding which we have not seen, but which was reported by "The Post", which said that (AUDIO GAP) nuclear weapon.

(AUDIO GAP) is the only intelligence agency who has been cited as having that finding. They also said that four years ago when apparently it wasn`t true. Other intelligence agencies aren`t coming out and saying, yes, we have also studied this and this is our finding, too. Other countries aren`t coming out and saying that`s our finding too.

I`m troubled this is a huge change in American policy based on something that seems very thin and might not be true.

TERRY: Well, I`m not sure if there`s a huge change in policy. But the fact that they can miniaturize nuclear weapon, it`s been out there as something they can do, North Koreans can do. And we have --

MADDOW: That they`re aiming at or that they have already done?

TERRY: Well, we don`t know. I mean, I have not seen the classified reporting. But they could. So if not now, they will get there very soon.

And they probably on a short range or medium range, I doubt right now that they can put it on intercontinental ballistic missile. So, that needs to be clear.

But the concern is correct in that they will get there, if not now, very soon.

MADDOW: And when you say they could put it on a short range or medium range missile, my -- I don`t know these things, but my understanding is there`s one thing to get the nuclear weapon down to a specific size but you have to make it incredibly durable to make it last all the way to impact on an intercontinental ballistic missile. That goes on to the upper atmosphere, has to survive reentry and all that stuff --

TERRY: Reentry vehicle, yes.

MADDOW: -- and so, that`s just -- that`s an order of magnitude different. But right now, is it widely believed that they could put it on a short or medium range -- is it seem conceivable given the intelligence?

TERRY: It`s conceivable on a short range or medium range missile.

MADDOW: And that means that South Korea and Japan --

TERRY: Are already under nuclear threat.

MADDOW: Under existing, as far as we guess, existing nuclear threat from North Korea?

TERRY: Yes, yes.

MADDOW: So maybe there`s a new intelligence finding in the United States that they have further miniaturized it or maybe somehow hardened the device that it could start linking up their ICBM capacity and their nuclear capacity, but that`s a marginal increase in their abilities.

TERRY: Right. That`s why I don`t understand all of the hysteria because the fact is they probably already have -- they have nuclear weapons that can target South Korea and Japan.

MADDOW: OK. When you see the president and the secretary of state and White House advisers and the secretary of defense, all of these different people saying very different things in terms of what they expect from North Korean behavior, it`s that actually -- it`s sort of comedic. Is it dangerous?

TERRY: Very dangerous, because I think -- just speak to incoherence in policy -- this dysfunction that`s coming out of the president Trump administration, because, you know, crisis like this, you need to send a very clear, unified message. And all of these competing, conflicting and, frankly, confusing messages is only going to make the crisis worse.

MADDOW: Why? Why does it make it worse?

TERRY: Because it`s going to lead to miscalculation and misunderstanding by the North Korean leader. So, imagine if Kim Jong-un thinks there`s an attack coming his way and there isn`t. That`s going to lead him to maybe preemptively attack us. So, I just think this really heightens the risk for conflict, where we`re going to blunder into a conflict or war that nobody wants.

MADDOW: How well do they understand American politics and American personnel, political personnel --

TERRY: We can barely understand what`s going on. How can North Koreans understand what`s going on?

And by the way, you know, Senator Graham recently said something about, you know, how Mr. Trump told him that maybe if thousands are going to die, thousands are going to die over there and not over here. This is deeply troubling because what is it saying? Are South Koreans lives and Japanese lives expendable?

MADDOW: Right --

TERRY: By the way, we do have 300,000 Americans living in South Korea and Japan. Very troubling.

MADDOW: Dr. Terry, thank you so much for being here. I feel like I ask you to come in always on very, very bad days. But thank you for helping us understand. I really appreciate it.

TERRY: Thank you. Thank you for having me.

MADDOW: All right. We`ll be right back. Stay with us.


MADDOW: We have an update for a strange story we covered last night that has gotten weirder today. CBS News Radio broke this alarming story yesterday morning about U.S. diplomats in Cuba starting to experience strange, unspoken symptoms that were so bad they forced those diplomats to leave Cuba and come home. The State Department wouldn`t explain it, but then one unnamed source told "The A.P." that those Americans suffered a possible sonic attack. Sonic. Something that could have caused permanent hearing loss.

Well, more information has started to trickle in today. If you were hoping, though, to look to our own government to help us understand what`s happening to our diplomats, you would be looking for love in all the wrong places.


REPORTER: Do you have any update -- I know it`s just recent -- on the diplomats and the hearing loss issue?

NAUERT: I don`t have any information on that particular part for you. You mentioned particular medical ailments. That is nothing that I can confirm.

REPORTER: Is the U.S. working with any other country to investigate these incidents?

NAUERT: I won`t comment on anything related to another country.

Anything? Are we done with Cuba? OK. We`re done with this now.

I`m done with Cuba right now. I`ve answered all that I can for you. Hold on. I`ve answered all that I can for you on Cuba. I know you still have questions. I`m not able to provide you all of the answers, OK? Investigation ongoing, period.


MADDOW: My favorite part of that is when she says she won`t comment on anything related to another country. You`re the spokesperson for the State Department. We`re done with this now. Investigation ongoing, period. Next.

Luckily, Canada is turning up some information on this story now even if our own government won`t. Canadian media reported today that one of Canada`s diplomats in Cuba fell ill as well and has been treated for headaches and hearing loss, raising the possibility that if the American diplomats were targeted in this strange way, they weren`t the only targets.

And then there`s new reporting from the "A.P." now. The "A.P." is now reporting tonight that investigators looking into this aren`t convinced that it was the Cuban government who carried out the supposed sonic attack. Quote: Officials familiar with the probe said investigators are looking into the possibilities that the incidents were carried out by a third country such as Russia, possibly operating without knowledge of Cuba`s formal chain of command. Even though the attack apparently happened in Cuba.

Sonic weapons are indeed a thing. There are all sorts of terrifying gadgets and devices that can render a person deaf without making a sound that the human ear can pick up. Scary stuff if you want to keep yourself up all night after reading something.

If some other country is using weapons like that to target American diplomats, if Russia is targeting American citizens with some kind of sonic ray in Cuba, that`s very strange, something we`re going to need to know more about.

Even with these new details, though, we still don`t know exactly what happened in Cuba. We don`t know what caused it, who was behind it, or how serious it was. The only thing we know is that the State Department doesn`t want to talk about it.


NAUERT: Anything -- are we done with Cuba? OK. We`re done with this now. I`m -- I`m done with Cuba right now.



MADDOW: A quick reminder before we go. We`ve got a special report on tomorrow night`s show about why specifically the president might be anxious about the reported turn by the special counsel`s investigation toward financial matters, toward banking, business, and financial transactions. We`ve got a special report tomorrow night`s show on the reason that turn in the investigation may be of serious and special concern to the president himself. That`s tomorrow night right here.


Good evening, Lawrence.