Show: THE RACHEL MADDOW SHOW Date: August 11, 2017 Guest: David Cay Johnston, Joe Cirincione
RACHEL MADDOW, MSNBC HOST: And thanks to you at home for joining us this hour. Happy Friday. I`m happy that you are here.
Cornelius Vanderbilt was one of the richest Americans ever. So much so that his name is kind of sin anonymous with what it means to be a rich person now, right? Vanderbilt.
Cornelius Vanderbilt was a self-made man. He was a New Yorker. He started off as a kid running ferry services between Staten Island and Manhattan.
He worked his way up to running and owning multiple ferry services, and then steamboat lines. Started off with regional steamboat lines, and then ultimately he got to ocean going steamboats.
He hit the real pay dirt when he started to close the loop on transportation. He got into the business of shipping by sea and also by land. By the Civil War era, Cornelius Vanderbilt was one of America`s great railroad tycoons.
Before there was ever a grand central station in New York City, there was a Grand Central Depot that Cornelius Vanderbilt created as a terminal for his train lines in New York City. To this day there`s a street that runs right up one side of Grand Central Station that`s called Vanderbilt Avenue. That`s named after him.
And for years, for decades, on the other side of Grand Central Station, on the other side of it from Vanderbilt Avenue, there was another monument to Vanderbilt that didn`t use his last name. It used his nickname. The nickname that everybody used for Cornelius Vanderbilt was the Commodore.
Commodore is a high rank in the navy. Cornelius Vanderbilt never served in the Navy, but apparently he got the nickname of the Commodore in his days as a kid running those ferry services in New York harbor. The other guys who worked the harbor alongside him called him Commodore basically as a way of teasing him, and it stuck.
And then that kid who they mocked as the commodore grew up to amass one of the largest fortunes in American history, the kind of fortune that leaves a mark.
In 1917, right next to the then brand new Grand Central Station opposite Vanderbilt Avenue, a huge new hotel went up. Thousands of rooms. It was called the Commodore Hotel. It was named after Cornelius "The Commodore" Vanderbilt. Had a statue of Vanderbilt right out front.
And that Commodore Hotel was one of New York`s big successful, shmancy, centrally located famous hotels starting in the early part of the 20th century and going on for decades. It was right next to Grand Central. It used to be Cornelius Vanderbilt`s old Grand Central Depot. It became Grand Central Station.
The hotel was right next to grand central station. The hotel was huge. It did great for decades. It did great until it didn`t.
By the 1970s, about 100 years after Cornelius Vanderbilt`s death, New York City was in what we have come to think of as its drop dead phase. The big old Commodore Hotel right next to Grand Central Station, it was on its last legs. Commodore Hotel went bankrupt in the 1970s, around the time that New York as a city thought that it was going bankrupt too.
When a young New York developer decided that he wanted to buy the Commodore out of bankruptcy and redo it, that became one of the biggest and highest profile deals of that developer`s life. It was a big deal because the Commodore Hotel was a big landmark piece of New York real estate right next to Grand Central Station. It also had this poetic storied connection to the great Vanderbilt fortune, you know, as New York City crumbled around it.
But it was also a big high profile deal because that young real estate developer put the city over a barrel in order to do the deal.
(BEGIN VIDEO CLIP)
REPORTER: You want tax abatements, you want special treatment, and by and large, you have gotten special treatment and tax abatements.
DONALD TRUMP, REAL ESTATE MOGUL: That`s correct.
REPORTER: He got very special treatment ten years ago when New York City was thought to be going bankrupt. Trump, who was then a brash 28-year-old, bought the dilapidated Commodore Hotel on 42nd Street just as it was about to be boarded up. He gutted it, renovated it, and opened the Grand Hyatt Hotel in its place. He convinced the city to give him an unprecedented $40 million tax break.
TRUMP: It now from a real estate standpoint is probably become the hottest city in the world. People are flocking here by droves, and I guess a lot of things had to do with it. Mostly, I feel it was the psychology of making New York a winner as opposed to a loser.
REPORTER: It`s a nice line, but straight public relations. The tax holiday that the Trump organization was given to build this hotel in 42nd Street is worth $45 million. But Donald Trump wouldn`t dream of blushing.
TRUMP: Probably, it`s the greatest thing that the city ever did, and I think the city is the first to acknowledge it. They went overboard. They gave a tremendous break for the first time actually in the history of New York. We got this commercial tax abatement. I would have never built the development if I didn`t get the tax abatement.
(END VIDEO CLIP)
MADDOW: Taking over that old landmark hotel when the city was in such dire straits, that whole deal wasn`t just a private real estate deal. It involved a whole lot of skin in the game from taxpayers. The arrangement over that Commodore Hotel deal was that Trump would be absolved of paying millions of dollars, over $150 million in property taxes that the city otherwise would have collected from him.
In exchange, the city of New York was basically -- they became kind of a stakeholder. They were guaranteed a financial stake in the hotel`s success. The city would receive annual payments from the hotel based on how well the hotel did each year.
So, that was the deal. He doesn`t have to pay property taxes, but the city gets a piece of the hotel`s revenue. And you know what? The hotel did pay the city. The whole deal worked for a few years until it didn`t.
I mean, Trump got his side of the deal OK. He didn`t have to pay $150 million in property tacks. But by around 1986 the hotel was doing really well. It was doing better than it had ever done before revenue-wise, so the city was expecting the several million dollars they had been getting from the deal each year thus far.
But starting in 1986, the payments stopped coming. The hotel just randomly that year sent over a few hundred thousand dollars instead of the millions of dollars the city was expecting. And that`s where the story gets really good. I mean, it was bad. It was terrible for New York. It was bad overall in terms of, you know, the balance of good and evil in the world.
But the story is good for us as Americans now in terms of trying to understand what is happening to our government and to the American presidency now and why.
This is why. This is Andrew Weissmann, a career prosecutor who made his name helping to dismantle organized crime networks, including organized crime rackets that were running schemes on Wall Street. One of those Wall Street cases got him involved in the prosecution of the one-time member of the Trump Organization, a man who played a key role in the development of and the money behind the Trump Soho Project.
Weissmann also led the Enron task force, which unraveled that multibillion dollar complex corporate con job. Andrew Weissmann now works for Robert Mueller.
Then, there`s Lisa Page. Lisa Page is a former prosecutor with deep experience in organized crime and money laundering, including working with an FBI task force that has pursued money laundering cases related to Putin connected and Paul Manafort connected oligarchs in the former Soviet Union. Lisa Page now also works for Robert Mueller.
This is Greg Andres. He is the latest hire that we know of on the Robert Mueller special counsel investigation. Until recently, Andres ran the fraud unit in the criminal division of the U.S. Justice Department. He specializes in money laundering, tax fraud, market manipulation, corruption. Greg Andres is a big fish. He also now works for Robert Mueller.
Three weeks ago, "Bloomberg" was first to report that the Mueller investigation was turning to Trump`s business past. Trump`s business transactions.
That night we called John Dowd, the president`s lawyer on Russia matters to get his response to that news. He responded to us bizarrely. Mr. Dowd told us on the phone that he did not believe that business transactions were under investigation by the Mueller investigation. He told us he just didn`t think that was true.
Then he told our producer who was on the phone with him, quote, this is the last call we will ever have. And then he hung up. It was really weird.
But whether or not the president`s lawyer chooses to believe it or not, by the end of last week, CNN was flashing it out. Quote: The FBI is reviewing financial records related to the Trump organization as well as Trump himself, his family members, his campaign associates. They have combed through the list of shell companies and buyers of Trump branded real estate properties and scrutinized the roster of tenants at Trump tower reaching back more than a half dozen years.
That recent reporting about the special counsel investigation turning the president`s finances to his business dealings, that comes on the heels of months of reporting that the Mueller investigation includes the financial and business relationships of Trump national security advisor Mike Flynn and Trump campaign chair Paul Manafort. That storyline about Manafort, of course, culminating this week with news that the FBI raided Manafort`s Virginia home two weeks ago, reportedly targeting banking records and tax information.
The president`s lawyer, John Dowd, may, in fact, now have heard enough to believe that this is all real now, real enough that he wrote an angry 3:48 a.m. e-mail to a "Wall Street Journal reporter this week demanding that any evidence that might have been seized from Paul Manafort`s home during that FBI raid, any evidence seized in that raid must be suppressed.
That was free legal advice, by the way. Paul Manafort is not John Dowd`s client. John Dowd`s client in this is the president, which you would think wouldn`t give him enough time to be working for other people as well apparently pro bono at 4:00 in the morning on a week night.
But here`s the tell. Here`s where history starts to help and where something that otherwise doesn`t make sense kind of starts to make sense. Look at the difference between how Paul Manafort and Donald Trump are reacting here to what`s going on in the Mueller investigation. Paul Manafort, the Trump campaign chairman, he has dropped his previous legal representation as of last night. He has now set up a new legal team to represent him. One that specializes in taxes, banking, foreign corrupt practices act, illegal cross-border banking, all that sort of stuff.
His new lead lawyer is literally a certified public accountant in addition to being a lawyer. That makes sense given the turn to the investigation toward following the money.
In contrast, the president is not doing that. The president is not putting together that kind of team. He`s got, like, the New York guy who handled his divorce records and who threatens the "New York Times." He`s got the Christian right`s attorney who goes on FOX News a lot and who could definitely defend the president very well if it turns out the president`s major legal liabilities that he has put up a Ten Commandments tablet in the Oval Office.
The president also has this new lead attorney, whose highest profile financial experience in the past was having a hedge fund client not just convicted, but given the longest sentence ever for insider trading and whose more recent financial experience now appears to be those late night misspelled emails about the wrong client that he is sending to the "Wall Street Journal." Although, hey, at least it`s Wall Street.
I mean, as this investigation into the president has turned into a follow the money kind of thing, as it has turned towards financial matters, the president has not tuned up his defense, his representation to meet that kind of a challenge. He doesn`t have legal financial specialists on board. He doesn`t have tax attorneys on board. I mean, like, even previous presidents in other smaller scandals have had.
I mean, other presidents in smaller scandals have had people on board by this stage going through the president and his family`s finances with a fine-tooth comb, red-teaming any discrepancies or potential problems that investigators might find there. Whether or not there is anything in President Trump`s finances that will ultimately draw attention from special counsel, it`s interesting, and notable that the president doesn`t appear to be preparing any sort of financial defense against a special counsel team that is absolutely chockfull of top notch financial specialists.
Why is that? Go back to the Commodore Hotel. When that deal between Trump and the city of New York went bad in the 1980s because the city figured out that he had stopped paying his part of the deal. When that went bad in the 1980s, something very unusual happened as a consequence of that fight. Remember, Trump had made this deal to not pay property taxes in exchange for giving the city a cut of the profits from the hotel.
When the city realized he wasn`t giving them their cut of the profits, they didn`t just sue him to try to get their money. They got access to his books. There was a city auditor`s office at the time, and, yes, Trump ran a privately held company, just like he does now.
But he had this deal not just as a private deal. He had this deal with the city, and so the city was able to get the books. The city was able to audit the hotel. To this day, that Commodore Hotel scandal remains one of the only times we, the public, have ever been allowed to see how the president conducts himself financially in business.
(BEGIN VIDEO CLIP)
REPORTER: In the 1980s New York City officials say an audit found that Trump and his partners in the Grand Hyatt Hotel had short-changed the city out of $2.8 million.
UNIDENTIFIED FEMALE: It was an example of extraordinary flimflammery.
REPORTER: Auditors found Trump in this letter he signed, formally authorized accounting changes that hugely understated the hotel`s profits to lower what was owed the city in rental fees.
UNIDENTIFIED FEMALE: Sneaky? Oh, it was very sneaky. He cheated the city of a substantial sum of money.
(END VIDEO CLIP)
MADDOW: That woman speaking there is Karen Bernstein. She was the New York City auditor general at the time this all happened in 1986. And it took a couple of years, tons of stonewalling on the part of Trump, but Karen Bernstein and her team did audit and report on how Trump was running that business.
And Bernstein`s public report concluded that basically Trump was running two sets of books, one that was the real estimate of profits at the hotel, and another set of books that they used basically just for this deal with the city to try to maintain a front that showed that the hotel was broke and didn`t have to pay the city anything. The city`s audit said Trump used, quote, an accounting methodology that is both abhorrent and distortive to make it look like the hotel owed the city less than it actually did.
Now, ABC News and CBS News both went back last year and looked again at this old dispute, when it became clear this might be the one window we would get into how Trump does business. CBS got forensic auditors to look at the findings. They described, quote, failures in basic bookkeeping, the seemingly sudden adoption of irregular accounting methods, and efforts to stymie officials.
In the course of trying to do this audit at the hotel back in the day, the auditors in fact at one point were physically blocked from even being allowed into the Trump Hotel to start the audit, and that went on for more than a year. But quoting CBS`s report, quote, It was what the city`s auditors discovered once they got inside the hotel that most surprised the forensic accountants. What most surprised them of the amount of financial information that was simply missing. The amount of missing information was staggering.
Monthly ledgers that were supposed to show income and expenses. The ledgers for seven months out of the 12-month year were simply gone. The hotel said the ledgers had been sent to New Jersey and then maybe they were lost in a flood?
The computerized version of those records, the hotel said those were sent to Chicago, but after those records got sent to Chicago, somehow they just disappeared. Sad.
The audit did get done. It was very, very ugly. All sorts of shenanigans went on for years with this thing. At one point in the process, Trump offered a job to the auditor`s brother so he can come work at the Trump Organization. Oh.
The Trump side sued the city over releasing the report to the public. A city clerk then conveniently mislabeled the case so it effectively got lost in the files for years until after Trump had sold off his shares at the hotel at which point another clerk came across the mislabeled case in the files and resurrected it so the two sides could ultimately reach an undisclosed settlement years later, once Trump was out of the picture. It was just a disaster.
But if you are wondering why, now as an American citizen, if you are wondering why, as president, Donald Trump is behaving strangely when it coming to the special counsel investigation, consider that the potential legal exposure of his financial dealings as a businessman, if that`s where the special counsel`s investigation is going. That would be something almost unprecedented in his entire 71 years of life.
I mean, obviously, he has not released his tax returns. A couple of pages of some old state returns from decades ago. Two pages of one federal return from 2005. That`s all anybody has seen of his taxes ever.
His business, the Trump Organization, it`s privately held, and it`s beyond that infinitesimally divided into subsidiaries and shells to avoid anybody seeing in to the numbers and the flow of cash. There`s also a Trump Foundation, which as a nonprofit, they did have to make public disclosures because they`re nonprofit. Those filings were such a line by line disaster area that they became a full-time beat for reporters like "The Washington Post`s" Stephen Fahrenthold, last year, ultimately earning David Fahrenthold a Pulitzer Prize and showing the country how Trump illegally used his nonprofit to settle lawsuits related to his businesses, how he illegally used his nonprofit to make political donations that appear to be tied to things he wanted for his business.
How he apparently used it is nonprofit as a way to use other people`s money to pay for things like his son`s boy scouts membership fee, which was $7. He also used his nonprofit a way to use other people`s money to buy portraits of himself to hang up at his golf courses. I mean, that`s what the financial disclosures from his nonprofit foundation showed.
That created such a mess for him that he actually tried to close the nonprofit and New York state now won`t let him because they say if that thing got shut down, it would interfere with an ongoing investigation.
So, that didn`t go well. I mean, and that foundation stuff, which was a catastrophe, that`s just what happened when people got a peek at what is supposed to be the do-gooder nonprofit part of his finances. The part that he knew would have to one day be open to the public.
If it is true that the special counsel investigation is now prying open the real business part of his finances, stuff he never thought would ever be made public. It is worth knowing that we have had precisely one peek over the years into what those look like.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: It was an example of extraordinary flimflammery.
(END VIDEO CLIP)
MADDOW: Extraordinary flimflammery.
It`s also worth noticing that the president seems to be making no preparation whatsoever to defend anything in his finances, to back them up, to bring on legal representation that could help him even try to do that if that`s what he wanted to do. I mean, the tiny window we have had into what his -- what is in his finances, makes that seem like an insane strategy if, in fact, the special counsel is really going there.
What gives with that? Why does he think he doesn`t need to play defense on this stuff?
America has always had rich guys. New York has always had rich guys. Some rich guys have had fortunes big enough that for more than a century they left a mark. In this case, modern history gives us reason to believe that this New York fortune might leave marks of a different kind. Might leave marks on the presidency.
Hold that thought.
MADDOW: David Cay Johnston is the Pulitzer Prize winning investigative journalist who earlier this year got his hands on the only bits of Donald Trump`s federal taxes that have ever been released. David Cay Johnston is the reporter who obtained two pages of Trump`s 2005 tax returns which the White House later confirmed were authentic. David is a specialist on tax issues and financial reporting. He is also the founder of DCreport.org.
Mr. Johnston, it`s great to have you back. Thank you very much for being with us tonight.
DAVID CAY JOHNSTON, FOUNDER, DCREPORT.ORG: Thank you, Rachel.
MADDOW: So, you saw my opening remarks there about the window that we have had in the past into the president`s finances. Special counsel Robert Mueller is reportedly looking into the president`s business transactions, his financial transactions. You know -- you know more about Donald Trump`s financial past than almost anybody else on earth who is not named Trump.
Given what you know and gin what we now understand about the Mueller investigation, it doesn`t strike you as strange that the president doesn`t appear to be like red teaming his finances, having a legal team and forensic accountants go through his stuff to try to build up his records against whatever Mueller might find.
JOHNSTON: Well, any normal person, you would expect -- let me begin by making a very important point. Most people who are in business are fundamentally honest. They may do some things here and there and cut edges, but overall, they conduct themselves with honor.
Donald Trump has no honor. He doesn`t see anything wrong with the things that he does. One of the reasons he may not be worried at all about what`s going to happen is he now has the power of the pardon, which is pretty close to unlimited. He can`t undo what has happened, and he has in the past relied heavily on, well, the records are missing.
There are some missing documents. That`s a lot of what Ellen Bernstein`s work was about. By the way, they found many of those supposedly lost records eventually because they were diligent.
But, no, it`s not particularly surprising, but the important thing to keep in mind here is to Trump, not paying you for work that you did, not honoring a contract, cutting off the health care of your own grand nephew and putting his life in jeopardy, what else could I do, would be his attitude? You see this in everything he says and does.
MADDOW: David, in terms of what`s about to happen here with the Mueller investigation, obviously we`ve seen, you know, this news that FBI agents raided Paul Manafort`s home. They were reportedly after financial information. We`ve had these reports about the grand jury subpoenas that have gone out. Not just from Congress, but also from federal prosecutors offices for Flynn and Manafort and their business transactions.
I mean, these are people around Trump who would conceivably be in a position to be able to be witnesses if they were flipped on anything untoward that might have happened with Russia during the campaign. The kind of pressure that`s coming down from this team that Mueller has put together with all these financial experts will be looking specifically -- not for matters of honor and not for matters of whether or not somebody is savory businessman, but they`ll be looking for crimes.
JOHNSTON: That`s right.
MADDOW: Short of a pardon, is there a way that the president should be preparing for that, that anybody should be preparing for that kind of scrutiny?
JOHNSTON: Well, as you pointed out, he hasn`t picture exactly the folks you would expect as lawyers to represent these things, and Mueller`s team, you notice, is not heavy on counter intelligence. It`s very heavy on financial fraud, on money laundering. And those are the areas where I`m sure Donald is highly vulnerable. He has had several transactions with Russians that make absolutely no business sense whatsoever. They only make sense if they are part of fraudulent transactions.
There`d been numerous examples of people that got mortgages with no underwriting because Trump told various bankers to do so. The story of the clerk who misfiled in Manhattan. We had the mystery of the missing Manhattan sewage that was crucial to his efforts that failed later to develop the west side yards.
And I`m sure that Mueller`s people are going to discover lots of problems with records being nonexistent or nonsensical. And so, of course, they`re going to want to turn people, but those won`t just be people like Paul Manafort. They may be clerks. They may be lawyers. They may be accountants who Donald has persuaded one way or another to act improperly.
The system of corrupting people in business is not greatly different, though less sophisticated, than what the Russians do when they try to compromise someone over a period of time as it was clear they were trying to do when they met with Donald Trump Jr. in June of last year.
MADDOW: David, in terms of the president`s legal representation, I am very struck by as you were just describing, I am very struck by the expertise of his team and the type of folks he`s brought on and the kind of work they`ve done in the past, especially the contrast with the type of financial and tax experts who Mueller has on his side of the ledger. If you were advising the president in terms of how to put together effective legal representation given what you know about his finances, what kind of legal representation should he have? Who should he be lining up to defend him?
JOHNSTON: Well, he needs to be lining up criminal defense lawyers whose background is in successfully representing people who`ve been gone after by the SEC, by Preet Bharara and others. And, frankly, the best advice he can probably get is if you haven`t lost records, lose them because those records will come back to haunt you.
But records leave fingerprints elsewhere. If you`re involved in money laundering, FinCEN, the financial enforcement group we have, which is essentially IRS people, they are good at all the trillions of dollars slushing around the world, finding a particular transaction, connecting up the dots on things, and Mueller has the team and the resources to go and pursue these things, and if they can just turn a handful of people, especially if those people are smart enough to have kept something to protect themselves if it went badly, they will not have a hard time doing what Mueller`s job is to do and that`s to make a case or cases.
MADDOW: David Cay Johnston, Pulitzer Prize-winning investigative journalist, founder of DCReport.org -- David, really appreciate you being here on a Friday night. Thanks for your time.
JOHNSTON: Thank you, Rachel.
MADDOW: All right. Lots more to come tonight. Stay with us.
MADDOW: So, here`s the headline. North Korea attacks on U.S. military bases in Pacific over bombers deployment. North Korea threatens attacks on U.S. military bases in Pacific over bombers deployment. Quote: If the U.S. is reckless misjudging the trend of the times and the strategic position of the DPRK, all the U.S. military bases in the operational theater in the Pacific, including Guam, will face ruin, in the face of all-out and substantial attack to be mounted by the army of DPRK.
That was the threat, the weirdly-worded always over-the-top threat from North Korea. That was the threatening headline about North Korea saying they`re going to hit Guam. But that headline was not from today. It was not from this week. It was from this time last year, this time last year North Korea was threatening to shoot missiles at Guam.
It`s a very bad thing that North Korea is threatening to shoot missiles at Guam. But if you have been hearing this week that the reason our president is issuing these threats now to start a nuclear war with North Korea, the reason the threats are so scary and the brinksmanship is so insane this week, right, if you`ve been hearing that that reason is because of the North Koreans crossing a new red line and threat to think shoot missiles at Guam, it`s undoubtedly a bad thing that they`re making these threats, but it`s not new. They threaten to shoot missiles at Guam all the time.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Today`s warnings from North Korea are the latest in a series of provocative threats which have forced the U.S. and South Korea to plan for possible military retaliation. The North Koreans claim they put their long range missiles on high alert aimed at American targets in Guam, Hawaii, and the U.S. mainland.
(END VIDEO CLIP)
MADDOW: That was not from this week. That was not from this year. That was not from last year. That was March 2013, another time when North Korea was threatening Guam and in that case they were not just threatening Guam but Hawaii and South Korea and the U.S. mainland as well.
It`s really bad that North Korea`s threatening Guam. Guam is U.S. soil. It`s really bad that they`re mounting those threats, but they do it a lot.
What`s different this week in terms of it feeling like we`re on the brink of war like never before, what`s different is not that North Korea is doing something they`ve never done before. It`s now how threatening their behavior is. I mean, their threats obviously have to be taken seriously, they always have been in the past, but we haven`t had weeks like this in the past.
What is actually unprecedented, what is truly new is the behavior of the American government, not North Korean government. President Trump threaten war against North Korea again today, for the fourth straight day, and then he announced that he will be speaking with the Chinese president tonight and then I kid you not, he said, quote, hopefully, it will all work out with North Korea. And then he proceeded to threaten North Korea again.
What he happened this week, this strange netherworld of threats and over- the-top alliterative comments from the president about nuclear war, what has happened this week is not because of something definitively new in terms of the North Korean threat. All of what we`ve been experiencing this week appears to have been sparked within our own government by a newspaper article, by a "Washington Post" article that described one confidential Defense Intelligence Agency report, a report that`s not been publicly released. It`s a report that supposedly concluded that North Korea has miniaturized a nuclear weapon and can fit one on a missile.
Now, the Defense Intelligence Agency might be right about, but they have been exactly wrong about this exact thing before, and no other intelligence agencies still now, all these days into this crazy period we`re in right now, no other U.S. intelligence agencies have come out and made their own case publicly that supports those same conclusions.
What does explain the president spending the last four days threatening a war against North Korea? What explains such a change toward North Korea when North Korea hasn`t changed really at all? What explains potentially starting a war over this and threatening it every day?
Joining us now is Joe Cirincione, president of a global security foundation called the Ploughshares Fund.
Mr. Cirincione, I know from an inside source that I am screwing up your vacation which makes me particularly grateful that you are here tonight and I`m sorry to your family.
JOE CIRINCIONE, PRESIDENT, PLOUGHSHARES FUND: Well, thank you very much, Rachel. I`m in your state of Massachusetts, on Cape Cod. But it`s always a pleasure to join you.
MADDOW: Well, I hereby wish you a tan and a blue fish tomorrow to make up for all of this.
MADDOW: Joe, I feel a little bit alone in the wilderness on this, which is why I`m particular grateful you`re here.
MADDOW: Is it true that there is nothing substantively new from North Korea? Obviously, North Korea is a military and nuclear threat. They have been marginally advancing both in their missile technology and their nuclear technology over the years. They had another missile test a couple weeks ago.
But is it true there`s really nothing new that led to this week of this incredible brinksmanship we`re seeing?
CIRINCIONE: Not this week. You`re right. They have achieved the capability to launch a ballistic missile at the United States. They may have the ability to actually a nuclear warhead on there. They don`t know if it`s reliable yet.
But this -- the last successful test happened two weeks ago. You didn`t see this kind of reaction after they actually crossed the threshold. What we have is a DIA intelligence assessment leaked to the "Washington Post." I don`t hear the Trump administration complaining about this leak.
It may be correct. I personally think that it`s more or less correct. But we don`t know, the DIA should show their work. What we need is to have unclassified version of this, and the other intelligence assessments that are slowly leaking out. Let`s see why they`re holding these judgments. Let`s have hearings in Congress, closed for classified information, open so the rest of us can do this.
Remember, when we were in the buildup to the war with Iraq, there were also these intelligence statements. It`s when they made an unclassified version public that some of us doubted the intelligence, criticized this, show the exaggerations. It didn`t work to stop the war, maybe we learned our lesson. It`s certainly time for us to take a closer look at this particular assessment.
MADDOW: Joe, the sort of common windows about the structure of how these decisions are being made within this administration in this White House is that while the president might be unpredictable and might be sort of freelancing on these and issues saying things that come to mind for whatever reason, there are adults on national security matters, H.R. McMaster as the national security adviser, Secretary Mattis at the Department of Defense. There are adults there, experienced national security professionals and they are the sort of people who would make sure the right processes were followed if the United States were going to come to a war footing with an adversary like North Korea, or that we were going to make a major change in our stance toward that country.
Is there any indication that those adults in the administration are doing anything like that? Are you seeing any signs that there`s going to be an effort to make a case to the public for what is -- what is driving this radical change and this brinkmanship from the president?
CIRINCIONE: I was very disturbed by the press conference today, to see the president trot out his secretary of secretary of state, his national security adviser, his U.N. ambassador, basically as props to sort of validate his statement. And he made even more wild statements today, that there was a military option with Venezuela. What is he talking about?
I don`t see any evidence that the real experts, the people who actually know what they`re doing, what they`re talking about, have control over this situation. They are being dragged behind by the president who seems to make it up on the fly. When he says, you know, I`m not going to talk about that, we don`t talk about that, what he means really is I don`t know what I`m talking about. I just thought this up a minute ago. These words are coming out of my mouth and I`ll leave it to my staff to adjust or explain what I`m saying.
This is troubling enough when it comes to things like Venezuela, when it comes to what could be the largest war we`ve seen on this planet since World War II and possibly a nuclear exchange, this is downright dangerous. This is not normal. This is bizarre.
We are witnessing the destruction of American grand strategy before our eyes. We`re witnessing the collapse of American credibility. No, I don`t think the adults have control over this situation.
MADDOW: Joe Cirincione, president of the Ploughshares Fund, thank you. Giving us all a reason to need another vacation, even though some of us just came back to one. I appreciate you being here tonight, Joe. Back to your vacation with you right now.
CIRINCIONE: Thank you, Rachel.
MADDOW: All right. We`ve got much more to come here tonight. Stay with us.
MADDOW: Let me explain a little bit about what just happened on our air here. Moments ago, our nuclear expert friend Joe Cirincione, national security pro, lifetime of experience in these matters, you might have seen just a moment ago on this program, Joe Cirincione in the most polite and professorial kind of way, he did lose his mind a tiny little bit about the president of the United States, our president threatening a war with Venezuela today.
Joe was not kidding about that. Here`s what he was referencing.
(BEGIN VIDEO CLIP)
REPORTER: Can you tell us what you`re considering for Venezuela? What options are on the table right now to deal with this mess?
TRUMP: We have many options for Venezuela. By the way, I`m not going to rule out a military option. We have many options for Venezuela.
This is our neighbor. This is -- you know, we`re all over the world, and we have troops all over the world in places that are very, very far away. Venezuela is not very far away, and the people are suffering, and they`re dying. We have many options for Venezuela, including a possible military option if necessary.
REPORTER: That would be a U.S.-led, Mr. President?
REPORTER: That would be a U.S.-led military operation?
TRUMP: We don`t talk about it, but a military operation and military option is certainly something that we could pursue.
(END VIDEO CLIP)
MADDOW: Hear that, Southern Command? Hear that? Hey, Marine Corps, ready to invade Venezuela? Ready to dust off those plans because the president at his golf course tonight, apparently off the top of his head, announced that was -- what was the phrase? Certainly something we could pursue.
"Reuters" is reporting tonight that the Pentagon has not actually received any orders from President Trump on a possible military option in Venezuela. A Pentagon spokesman telling "Reuters", quote, the Pentagon has received no orders. They`re referring all questions on this matter to the White House.
That said, I think a lot of us would actually be grateful if people stopped asking the president questions that could conceivably be answered with the answer, yes, we can use military force there. Maybe just stop asking him questions where that could conceivably be the answer because every time somebody asks him a question like that, he thinks it sounds like a good idea. So maybe just only questions about, like, animals or his family or ties, only questions about ties from here on out.
We`ll be right back.
MADDOW: Happy Friday, everybody. I want to tell you that the great Joy Reid is here tonight live right here after me. She`s doing "THE LAST WORD" tonight. Also, the great Brian Williams is here live tonight with "THE 11TH HOUR" after Joy Reid, so there`s plenty of reason to pop more popcorn and stick around for this evening.
But I want to tell you in addition to that, in addition to those fine folks coming up, we have one more story that we`ve got for you tonight. It may affect your plans for next week maybe. But the real reason you want to hear it is that it`s a mystery, and who doesn`t love that at the end of the week? That`s our last story tonight, last story of the week.
That`s next. Stay with us.
MADDOW: President Trump is supposedly in the middle of a 17-day working vacation at one of his golf clubs in New Jersey, God bless him. But today he announced a change in plans, which is -- it`s a mystery.
Until today, this was the president`s official schedule. Sunday night he was supposed to travel from his New Jersey golf club back to Trump Tower in New York City, to spend the night at Trump Tower for the first time since he was inaugurated. Home sweet home.
The plan was for him to stay at Trump tower, Sunday night, Monday night, Tuesday night, until Wednesday. And then he was going to go back to New Jersey, back to the golf club in New Jersey for the rest of the week.
Well, today, law enforcement in New York, the folk who`s help protect the president while he`s at Trump Tower, they got word of a change in plans. Politico.com was first to report that the president has no longer, well -- we don`t know how this affects everything else, but he`s now scheduled to fly to D.C. on Monday, and that`s weird for more than just the reason that he`s supposed to be on vacation.
The White House is undergoing renovations right now. The Oval Office is empty. There`s no desk, no chairs. The walls of the office are all covered up in plastic. Presumably part of this long vacation plan was because the president had to get out so the workers could do their thing.
So why is he heading back now?
The president was asked about it today, and he said this: We have a very important meeting scheduled. We`re going to have a pretty big press conference on Monday.
We don`t know what it`s about. Here`s a really weird possibility. "Bloomberg" has new reporting tonight, citing four sources saying that, quote, some White House and Republican officials are exploring the idea of putting Democratic Senator Joe Manchin in charge of the Energy Department. Current secretary of energy is former Texas Governor Rick, oops, Perry. He`s apparently among the candidates to replace John Kelly at the Department of Homeland Security. They`re citing three people familiar with the deliberations.
Now, the homeland security job is open because John Kelly became the president`s new chief of staff. So maybe what`s happening on Monday is they`re announcing the start of musical chairs? Senator Manchin leaves the Senate to go take Rick Perry`s job. Rick Perry leaves his job to go take John Kelly`s old job. But then who would take Senator Manchin`s old job, the Senate seat from West Virginia?
Well, the person who would get to pick Joe Manchin`s replacement in the Senate is that state`s governor, Jim Justice who, remember, just switched parties and is now a Republican. And presumably newly minted Republican Jim Justice would put a Republican in that Senate seat that up until now has been held by Democrat Joe Manchin. That would matter because it would put the president and the Republicans one vote closer to getting key legislation through like, say, killing health care.
So, Manchin, of course, is a conservative Democrat. He`s facing a tough re-election battle in 2018. Tonight, his office is saying he has not had any recent conversations with the administration about the energy position.
So, it`s a mystery. We`ll see if this very important meeting and this pretty big press conference on Monday involves Joe Manchin and this very dramatic partisan musical chairs. We will find out on Monday. Meanwhile, watch this space.
That does it for us tonight. I will see you again on Monday.
Now, it`s time for "THE LAST WORD" with the great Joy Reid sitting in for Lawrence.
Good evening, Joy.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.