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Flynn under investigation Transcript 11/22/17 The Rachel Maddow Show

Guests: Andrea Bernstein

Show: THE RACHEL MADDOW SHOW Date: November 22, 2017 Guest: Andrea Bernstein

CHRIS HAYES, MSNBC HOST, ALL IN: All right. That is "ALL IN" for this evening.

THE RACHEL MADDOW SHOW starts right now.

Good evening, Rachel.

RACHEL MADDOW, MSNBC HOST: Happy Thanksgiving, my friend.

HAYES: Happy Thanksgiving. I`m thankful for you, Rachel Maddow.

MADDOW: I`m thankful for you, too. Are you going to be with your family? Are you doing the full --

HAYES: The full thing. My mom and dad host every year. They usually have about 25 people. So, there`s a whole bunch of folks. We`ll be going up there with kiddos. And very excited.

MADDOW: I wish you mashed potatoes, happiness and quietude.

HAYES: Same to you.

MADDOW: Thanks, my friend.

And thanks to you at home for joining us this hour. Thanks for being with us on a Thanksgiving Eve.

It`s not a Friday, so that means technically there`s no Friday night news dump going on. But it is the eve of a national and very widely observed federal holiday, and so, yes, there is stuff being dumped tonight. We`ve got, actually a much bigger show for you tonight than I thought we would have.

We`re going to start with a couple of dates you need to put on your calendar in the not too distant future.

December 14th, we think that`s the date that the FCC is going to have the vote on net neutrality, which sounds very boring, but that will literally determine whether you get to look at what you want on the Internet anymore. That December 14th vote is going to come right on the heels of the December 12th Senate election in Alabama. If you have plans that night, you should cancel them. You will be staying home and watching election returns. That will be the Alabama Senate election between Roy Moore and Doug Jones, which is now being held only the other conceivable circumstances in which the modern Democratic Party might win a Senate seat in the state of Alabama.

And then, actually again, on that same day, on December 12th, there is an important deadline that you should know about. December 12th is the deadline by which all federal agencies in the U.S. government have to certify that they have cleansed themselves. They have rid themselves of software made by a company called Kaspersky. Kaspersky software is suspected of being a sort of being a hamburger helper for Russian intelligence agencies trying to hack into U.S. computers and steal important U.S. data.

So, that deadline again for all federal agencies to certify that they are Kaspersky software free, that is December 12th.

It`s interesting though, the biggest federal agency of them all, the largest organization in the United States, the largest organization within the U.S. government already doesn`t use Kaspersky. That`s the Department of Defense. And recently, the House Science Committee wrote to the Department of Defense and asked, why is that? How come you don`t use Kaspersky and all these other parts of government do?

The answer turns out to be really revealing. It`s interesting on its own terms and it is probably really worrying for a senior member of the Trump campaign who became a very high ranking official in the Trump White House, because what the Defense Department said, what they told Congress about why they don`t have Kaspersky software to worry about, that communication was obtained by reporter Paul Sonne at "The Wall Street Journal." And we know based on his reporting, all this new stuff about Kaspersky software, and the worries that it`s linked to Russia and what the Pentagon knew about that.

According to this new information, the Defense Department says that for more than a decade, since 2004, U.S. military intelligence flagged Kaspersky software as potentially dangerous, as a potential tool of the Russian government. Pentagon, of course, has its own intelligence agency that handles matters like this and lots else. It`s called the Defense Intelligence Agency, the DIA.

Apparently, they were warning about Kaspersky as early as 2004. Then, sometime after 2009, the threat analysis center at the DIA started circulating within the Pentagon, the DIA assessment that Kaspersky was a tool of the Russian government. Then, as early as 2012, DIA started sharing that analysis, that warning about Kaspersky software, they started sharing that not just within various acquisition programs in the Pentagon, they started sharing that warning with other agencies in the U.S. government, as well.

And then, this ends up being important, in 2013, the DIA, the Defense Intelligence Agency, they did a full-blown report on the software being linked to Russia intel. According to Paul Sonne`s report in "The Wall Street Journal", in 2013, the DIA issued a Pentagon-wide threat assessment about products made by Kaspersky Lab.

Now, that report itself from 2013 hasn`t been revealed by the Pentagon, it`s still secret. But we do know what the basic point of it was. It was a warning about Kaspersky and Russia.

And that`s why even though every other agency now has until Roy Moore day, December 12th, to get rid of all their Kaspersky software, the Pentagon has already done so, because their intelligence agency, DIA, was Johnny on the spot about that. Do not use this software. If you are using Kaspersky software, you are opening yourself up to Russian intel. They`ve been on that since 2004. They put out a big formal Pentagon-wide warning about it in 2013.

And thanks to that great reporting from "The Wall Street journal," there`s something about that timeline that ought to be jumping out at you right now and waving itself as a big red flag.

You remember Michael Flynn? Michael Flynn set the world record for shortest tenure ever for a national security adviser to president of the United States. He served in the White House for 24 days. Mike Flynn had been a high ranking, well regarded general who spent a career in military intelligence before he got involved with the Trump campaign. At the end of the first term of the Obama administration, President Barack Obama in the summer of 2012 appointed Mike Flynn to run DIA, to run the Defense Intelligence Agency.

And now we know that by the time Mike Flynn took over at that agency, that agency had been warning for at least eight years about Kaspersky software being a front for Russian intelligence. That agency that was Flynn was running, for years, they had been warning other elements of the Pentagon to stay away from Kaspersky software. The year that Flynn started, the year that he was first at DIA, DIA started warning agencies outside the Pentagon about Kaspersky being a front for Russian intelligence. And then under his leadership, he took over the Defense Intelligence Agency in July of 2012, under his leadership, while he was running that agency in 2013, DIA produced their big report, their Pentagon-wide threat assessment about products made by Kaspersky.

And the year after the DIA published that warning report, about Kaspersky, under Flynn`s leadership, the year after that, Flynn got fired from DIA.

And then where is the first place he turned to personally make money after he was fired by DIA? Kaspersky software.

This past March, the Democrats on the House Oversight Committee obtained and published information about payments that Mike Flynn took from overseas sources after he was fired from DIA. Remember, one was that cargo plane company, with the weird name, Volga-Dnepr, I don`t know how you say that. It`s this cargo plane company -- it wasn`t just linked to the Russia government. That cargo plane government was at the center of a bribery scandal at the U.N. involving Russian government officials. One thing it`s famous for.

Flynn also, of course, took money from RT, the Russian state media company. But the other one he took money from was Kaspersky. That in fact, calendar-wise, that`s the first one we know of.

So, we have -- we`ve known about those payments from Russian entities to Mike Flynn for awhile now. But putting it together with this other information we`ve got about what had just been going on at DIA under his leadership before he took that money, that gives us a very, very clear window into his mindset, into what he knew when he started taking all those rubles. I mean -- theoretically, he might have argued that he had no idea that RT was Russian-state sponsored media, right?

Maybe he thought it was arty, right? He heard RT like artsy, arty. Not Russia Today.

Maybe that cargo plane company, it`s got such a weird name, Volga-Dnepr. I don`t know, maybe he thought it was a misspelling of some other way less Russian cargo airline. Who knows?

But Kaspersky? We know for sure he was in a position to know about Kaspersky. He had just left an agency that he ran where we now know he oversaw a Pentagon-wide formal threat assessment warning everybody about Kaspersky being a front for the Russian government and Russian intelligence services. And that immediately after he left that job, where he gave that warning, he got onto Kaspersky`s payroll.

And then within a matter of months of taking that money, he went to Moscow. He led the standing ovation for Vladimir Putin at the RT anniversary gala. And then he very shortly came back to the United States and very quickly started working for the Trump campaign.

You know, Mike Flynn is a registered Democrat. He`s been a Democrat all his life, as far as we can tell. There`s a lot of things about Mike Flynn that make it weird on paper that he ended up working on the Trump campaign.

But we also know that what immediately preceded him working for the Trump campaign was him taking a lot of Russian money and visiting Moscow.

There`s a reporter at "BuzzFeed News" named Jason Leopold who is kind of a FOIA warrior. FOIA is Freedom of Information Act, and all reporters, all news organizations use FOIA request to try to get information out of the government. Jason Leopold has turned it into kind of a high art.

This is the pinned tweet at the top of his Twitter feed. Giant stack of paper. You see, the caption there is, acknowledgement letters to all the FOIA requests I filed in 2016.

All the way back in 2014, right after "The Washington Post" published this piece about Mike Flynn being forced out at DIA, this is the story that really broke the news that Mike Flynn hadn`t resigned from DIA, Obama had fired him. The day after "The Washington Post" published that provocative piece, Jason Leopold filed a request with DIA about Mike Flynn and his time at that agency including how and why he was fired.

Jason Leopold from "BuzzFeed" filed that request about Flynn, filed it with the DIA in 2014, three years ago. Jason Leopold just got a response to that FOIA request.

I`m going to read you how he characterized his response. I will warn you, there is no swearing in what I`m about to say, but there is an allusion to a swear word. So, if you are offended by the idea of swearing kind of by proxy, you should prepare yourself that this is about to happen, because this is the start of Leopold`s tweet explaining the response to this FOIA request that he got three years down the road.

Quote: This is F`ed up. OK, that`s all the swearing. This is F`ed up. Three years ago, exclamation point, exclamation point, I filled a FOIA request for the Defense Intelligence Agency for documents on Michael Flynn`s job performance, his resignation, et cetera, DIA responded for the first time yesterday. DIA says these records on Flynn can`t be released because it would interfere with law enforcement proceedings.

Oh! And then he linked to the response he got from DIA, which in fact says, Upon review of your request, we have determined that the release of potentially responsive records concerning Lieutenant General Flynn could reasonably be expected to interfere with ongoing law enforcement investigative activities, which leads Jason Leopold to reply to himself underscoring this point, and this is exactly right. So, Michael Flynn`s tenure at the Defense Intelligence Agency is now part of an active law enforcement investigation.

It has previously been credibly reported that Mike Flynn was under three different kinds of serious and potentially criminal investigation right now. He`s reportedly been the subject of intense focus by the special counsel inquiry led by Robert Mueller. We`ve seen concrete evidence of that, including what appeared to be grand jury proceedings and subpoenas that had been served to Flynn associates.

We also know that Flynn is the subject of intense interest from congressional investigators, which led Flynn`s attorney to demand immunity very early on from the congressional investigators, immunity, in exchange for Flynn`s testimony. Nobody took him up on that and offered him immunity.

So, he`s being investigated by the Justice Department. He`s being investigated by congressional committees. He is also being investigated, we know, by the U.S. military, where he`s the subject of the military investigation into whether or not he broke the rules around his foreign travel to places like Russia and his acceptance of foreign payments from places like Kaspersky.

Well, now, the Defense Intelligence Agency would appear to be confirming that in addition to tall that, Mike Flynn`s time at DIA, Mike Flynn`s tenure at DIA was 2012 to 2014, that is also apparently part of ongoing law enforcement investigative activities concerning Lieutenant General Mike Flynn.

And now, tonight, NBC news breaks even more bad news for Mike Flynn. The Flynn Intel Group, which is Flynn`s consultant company, which would itself up after Trump was elected, that was not just Mike Flynn alone, or Mike Flynn and son. He also had a business partner in that firm.

This man, his name is Bijan Kian, I think it`s the way you say his last name, K-I-A-N. He was a partner in Flynn Intel. He appears to have been intensely involved in the day-to-day work of the Flynn Intel Group, including some of the controversial work that Flynn did secretly on behalf of the government of Turkey while he was also working on the Trump campaign without registering as a foreign agent.

Both Flynn and his partner, Bijan Kian, retroactively registered as foreign agents in March, after Flynn got fired from the White House. Well, now tonight, NBC news reports that, quote, federal investigators are zeroing in on Bijan Kian.

Quote: A former business associate of Michael Flynn has become a subject of special counsel Robert Mueller`s investigation. Federal investigators have questioned multiple witnesses in recent weeks about his lobbying work on behalf of Turkey.

So, former national security adviser, Mike Flynn, appears to be in the legal crosshairs right now, nine ways to Sunday. His son also appears to be in the legal crosshairs, at least four or five ways to Sunday. And now, his business partner, who appears to have been intimately involved in all of his business transactions, including for the ones they had to register as foreign agents. He also, according to NBC News tonight, and three sources familiar with the investigation, he also appears to be a subject of the Robert Mueller special counsel investigation.

And in practical terms, that would appear to mean that Mike Flynn is not just being squeezed personally. He`s being squeezed in a vice now.

Mike Flynn does not appear to be a wealthy man. He spent decades in the military. He only retired after Obama fired him in 2014. So, he`s not been out for all that long.

He`s not from a wealthy family. He`s facing intense and complex legal jeopardy from at least three different types of investigations, in the Pentagon, in Congress and in the Department of Justice. I mean, if you look in the dictionary under the headline worrying about legal bills, there is a picture of Mike Flynn right now. He has set up a public facing legal defense fund where anybody can give him money to help defray the costs of what are reported to be his seven criminal defense lawyers.

We do not have any idea how much that legal defense fund has raised or from whom. We have contacted the people who are running that fund to inquire, they have not responded to our requests for information. And up until now, with this little bit of news that I`m about to break here tonight, there has been some real profound ambiguity as to whether a certain billionaire might conceivably be able to help Mike Flynn out.

A real human factor at the center of this massive national security scandal that the Trump administration has brought upon itself, a real human factor is the financial factor for anybody who is caught up in these investigations. And you don`t have to have sympathy for them about it, you don`t even have to -- you know, like or dislike any of the people involved at a human level, to understand that this is potentially really important. It`s potentially a really important dynamic that might be driving people`s decisions, because for a lot of people who are swept up in this scandal, a lot of people who may have things to say to investigators, who may be deciding right now how much they want to say to investigators, how much they want to give up, how loyal they want to be to this president, for anybody who is not a billionaire or the child of a billionaire, the legal advice and the legal defense you need for when you`re involved in something like this can very quickly not just become expensive, it can become crippling, life changing, even multigenerational life changing debt for you and your family.

Before this week, the only information we had about anybody was covering their legal fees was that Mike Flynn is rattling a tin cup on the Internet and President Trump and his eldest son, billionaire and son of billionaire, were having their legal fees covered by the Republican Party and the Trump re-election campaign.

This past week, Shannon Pettypiece of "Bloomberg News" was first to report that the president will now stop charging the Republican Party for his legal fees, and that goes for his re-election campaign, as well. He`s going to start paying his own lawyer bills. We don`t think that means he`s going to reimburse the Republican Party and his re-election campaign for the hundreds of thousands oaf dollars, maybe over a million dollars already spent, but hey, you got to start somewhere.

When it comes to Don Jr., Shannon Pettypiece at also reported this week that Donald Jr. will stop getting his legal fees paid by the Trump re-election campaign. That leaves open the possibility that the RNC is still contributing to his legal fund. Now, as to whether or not anybody else is going to get any sort of help in paying for their lawyers, the White House started to make vague noises this week that some mechanism may be created, sometime, to help other people outside the Trump family pay their legal fees in the Russia investigation.

But the ambiguity on this point, which has persisted for weeks now, even for months now, since we first learned that the RNC and the Trump campaign were paying for Trump family expenses, but nobody else`s, the ambiguity on this isn`t just a frustrating thing in trying to report on this scandal. It ends up being ethically and strategically important, right? The RNC won`t say how it made that decision to start paying the president`s legal fees and the fees of his son. The Trump campaign won`t say how they arrived at that decision to start paying the president`s legal fees and those of his son.

Neither the Republican Party nor the Trump campaign will explain any process they went through or might two through in the future, by which they will decide whether or not they`re going to pay for anybody else. They haven`t closed off that possibility that other people might get their legal fees paid for, nor have they made any promises, though.

Think about that. I mean, I`ll tell you from the news perspective, it`s frustrating to report on that, just because there`s no clarity, it`s hard to say what`s going to happen. It gets frustrating that it`s consistently not resolved over weeks and months.

But imagine being one of the people who is subject to this decision and has lawyers on your payroll right now, right? Imagine being Hope Hicks, 29 years old. Imagine being Sam Clovis, previously an Iowa radio talk show host. Imagine being Mike Flynn, facing debt that will bankrupt you and your family, and potentially your children.

Imagine being one of those folks and wondering, maybe, if somebody in the Republican Party or Trump world, more broadly, might be able to start pickling up your legal fees. But you don`t know how that decision`s going to be made or when or who really gets to decide it. And meanwhile, that ambiguity creates this uncertainty for you over your future and your family`s future.

You`ve been asked to speak to Mueller`s investigators about the president, and about matters that could potentially determine the continuing existence of this presidency. Maybe you`ve been asked to testify to the grand jury. A grand jury that may bring further indictments affecting the president`s campaign or the president`s administration, potentially the president`s family.

You`re already doing interviews and giving testimony under oath. You`re making decisions about what to say. While the White House and the Republican Party have dangled the possibility that your legal fees could be picked up, but maybe not.

Earlier this week, word from the White House that President Trump was finalizing a plan to use personal funds to help current and former White House staff with their legal costs. Quote, Trump is only considering using personal funds to pay for the legal bills of current and former White House aides, not people who served exclusively during the campaign. This would rule out some of the highest profile figures in the investigations, including Paul Manafort and Rick Gates, both of whom have already been indicted. Also not eligible, George Papadopoulos, campaign foreign policy adviser who has already pled guilty.

So, that was the word from the White House earlier this week. Does that mean that Trump might pay for Mike Flynn`s legal defense? I mean, as of earlier this past week from the White House, that was specifically unclear. Quote, it is unclear whether Trump`s offer extends to Michael Flynn, who was fired from his role at Trump`s national security adviser early in the administration.

I mean, Flynn didn`t just work on the campaign. He did make it 24 days into being national security adviser. So, that makes him technically a former White House official, so maybe Trump will pay his bills? Maybe? Should it matter based on what Mike Flynn`s going to say?

The ambiguity isn`t just frustrating here, the ambiguity here from the White House and from the president, it has a purpose and effect. As people keep testifying, right? This has been this miasma of threat and the promise, in which all of these White House and campaign staffers have been proceeding through these investigations inquiries, right? Giving testimony under oath and potentially speaking to grand juries.

I said I had a little bit of news to break on this. Ty Cobb, the president`s lawyer on the Russia investigation does give us some news on this tonight. That fund they`re trying to set up to defray legal expenses for people other than the Trump family -- first of all, we`ve got clarity tonight, that that fund is not yet set up.

But Ty Cobb tells us this. As of tonight, special thanks to Kristen Welker from NBC News who spoke with Mr. Cobb on this matter for us tonight. He tells us this, quote: Once that fund is fully approved and operational, it will be for the benefit of witnesses, staffers and campaign workers forced to incur extraordinary legal expenses, merely because they were witnesses. That fund will not include any indictees or current targets.

So, in one sense, this contradicts the earlier guidance from the White House about this supposed fund where people are going to get their legal fees paid. It`s not just for people who only worked in the White House, according to this latest news from the White House, Ty Cobb, the statement to us tonight. That fund would also be for people who worked on the campaign, for campaign staffers, as long as they were witnesses. Nobody will be allowed to tap that fund if it ever comes to exist if they are an indictee. So, I guess that means Gates, Manafort and Papadopoulos are out.

Nor will anybody be allowed to tap that fund if they are a current target of the investigations. Well, who that applies to, I don`t know. We also do not have word from the White House whether or not our billionaire president himself will be contributing to such a fund for the legal defense of his campaign staffers and White House aides.

As far as we understand it, it`s not legally clear that the president can do that if he wanted to do that. But here`s a real piece of news that we got tonight, definitively from Ty Cobb at the White House. There is one former White House staffer and campaign official who appears to be in very deep and complex legal jeopardy, one who has already set up his own legal defense fund, this is Mike Flynn, and according to Ty Cobb at the White House tonight, if Mike Flynn has been holding out any hope that President Trump might personally help him defray his legal expenses, the White House is foreclosing that possibility tonight.

Quote, the president is not planning to contribute to Mike Flynn`s legal defense fund. So, the first definitive statement after all this time. General Flynn, you`re on your own. Happy Thanksgiving.

This turns out to be a really important decision, not just for the Flynn family, at this Thanksgiving, but also for what happens next here. More on that ahead. Stay with us.


MADDOW: On March 21st, 1973, President Nixon met with his White House counsel, John Dean, in the Oval Office. A tape was running.


RICHARD NIXON, FORMER PRESIDENT: How much money do you need?

JOHN DEAN, FORMER WHITE HOUSE COUNSEL: I would say these people are going to cost a million dollars over the next two years.

NIXON: We could get that.

DEAN: Uh-huh.

NIXON: You, on the money, if you need the money, I mean, you could get the money, let`s say --

DEAN: Well, I think that we`re going --

NIXON: What I mean is, you could, you could get a million dollars. And you could get it in cash. I know where it could be gotten.

DEAN: Uh, huh.

NIXON: I mean it`s not easy, but it could be done.


MADDOW: President Nixon and his White House counsel in the Oval Office. I know it where it could be gotten. You could get the cash.

The reason, Nixon was asking about how to get a million dollars, telling his White House counsel he knew where to find a million dollars in cash, is because his White House counsel just informed him that guys who broke into Watergate for him were demanding quite a lot of hush money. And President Nixon`s response to that was, he knew where he could find that kind of money and in cash, too. There`s ways to do it.

The other way the president`s access to money came up in Watergate was when the president promised two of his top aides, as he fired them, quote, you`ll need money. I have some. Bebe Rebozo, Nixon`s closest friend, personal banker, Bebe has it. And you can have it.

This next conversation was recorded immediately after Nixon announced the departure of those two top aides, second heads up of the night here, Nixon does get a little salty in his language here.


NIXON: But let me say, you`re a strong man, goddamnit, and I love you. And I love John, and all the rest. And by God, keep the faith, keep the faith. You`re going to win this son of a bitch.

H.R. HALDEMAN: Absolutely.

NIXON: God bless you, boy. God bless you. I love you, as you know.


NIXON: Like my brother.


NIXON: All right, boy.

HALDEMAN: Go on and up from here.

NIXON: Keep the faith.



MADDOW: Keep the faith. Keep the faith. Did I mention you should keep the faith? Nixon telling his departing chief of staff, you can hear him that, as historians have, keep the faith, meaning, don`t you flip on me.

When it comes to people who get caught up in presidential scandals, figuring out who pays the legal bills isn`t just an interesting footnote in history. It is also potentially scandalous and determinative in its own right.

And NBC News historian Michael Beschloss joins us on that next. Stay with us.


MADDOW: -- that President Trump now says he will not contribute any of his own considerable personal funds to the legal defense of his former national security adviser, Mike Flynn. The White House telling us that in no uncertain terms tonight. The White House also telling us tonight that the fund the White House is setting up for legal defense in the Russia investigation, that fund will be limited to staffers and campaign workers who are brought into the investigation purely as witnesses.

White House telling us tonight that the White House fund will not be used for anybody indicted or targeted by the Russia investigation.

With visions of Watergate dancing in your heads at this news, joining us now is Michael Beschloss, NBC News presidential historian.

Mr. Beschloss, happy Thanksgiving. Thank you for being here.


MADDOW: You were the one who first told us to sort of watch out for the issue of legal funds, legal fees, potential --


MADDOW: -- payments between principals and outlying figures. As something that was important in Watergate and might end up being important here. Why is that? How did that function in Watergate?

BESCHLOSS: Well, it sure was. You know, you and I have talked about the fact that maybe it`s not a bad idea for a president, once in awhile, to know a little bit of history, and maybe in this case, Watergate history. You know, take a look at Richard Nixon`s impeachment. Article One was something called obstruction of justice. And in that count, it say that Nixon was guilty of paying substantial sums of money to potential witnesses, to influence their testimony.

Is this sounding a little bit familiar? And another thing that`s also came up in the grand jury deliberations in which Richard Nixon was named an unindicted co-conspirator. So, if Donald Trump thinks that paying money to people who work for him to get them to be silent, hush money, or to influence what they`re going to tell a grand jury, or other people in the judicial process, this could be the very dangerous.

MADDOW: And given that historical precedent -- it seems to me like there`s two sorts of kind of forms of ambiguity that may be relevant. One is the question whether or not this -- this financial assistance might be made available to certain people as people are being interviewed by the special counsel, as people are being interviewed by Congress, as people are even potentially testifying to the grand jury. The lack of clarity around that itself seems like an operational thing, that seems to be something that may have an effect on whether or not people testify in a way that`s favorable to the president.

In Nixon`s case, was it clear in that obstruction of justice case that he had demanded a specific kind of testimony in exchange for the financial assistance he offered or was it just implicit because he was giving people money?

BESCHLOSS: It was conveyed. For instance, Howard Hunt, who was in charge of the Watergate burglars, he basically blackmailed Nixon and said to Nixon`s people, I`m going to sing to the Feds unless you give me money, and a lot of money.

And this -- you know, that conversation that you played between Richard Nixon and John Dean, when they talk about giving money, Howard Hunt got $75,000 plus very quickly after that conversation. So, there was an obvious link.

MADDOW: A demand for hush money and then an overt and deliberate decision to pay it, yes. When that ends up on tape, that ends up following you around.

BESCHLOSS: Yes, and even if a president, like President Trump, does not have tapes, which we assume that he probably doesn`t, you know, when there`s an investigation like this and people are in danger of going to jail, it`s very hard to keep a secret if a president is trying to essentially buy perjured (ph) testimony.

MADDOW: Michael Beschloss, NBC News presidential historian, really nice of you to be here on Thanksgiving Eve, my friend. Thank you very much.

BESCHLOSS: Thank you. Good to see you, my friend.

MADDOW: Right. You, too.

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


MADDOW: The day before Thanksgiving is a really awesome time for dumping bad news. If you are the Trump organization, the Trump real estate business, that bad news dump tonight came in the form of this press release. Trump Hotels and Condominium Association announced management and license contract buyout for the Trump SoHo Hotel. Huh?

You want to less shiny press release version of it, here`s the headline at "The New York Times" tonight. Trump Organization will exit from its struggling SoHo Hotel in New York. The Trump SoHo is a hotel that has not done very well, paired with condos that have been a nightmare for the Trump family business.

One lawsuit settled out of court claimed that Trump SoHo was developed with the undisclosed involvement of convicted felons and financing from questionable sources in Russia and Kazakhstan.

In another lawsuit, buyers claim that the Trump family, specifically the Trump children, had inflated claims about how many units in the building had actually been sold. They eventually settled that lawsuit by agreeing to return over 90 percent of the millions of dollars that buyers had paid the Trumps in deposits for those condos. Those fraud allegations eventually led to a criminal investigation by the district attorney in Manhattan.

Last month, a joint investigation by "ProPublica", "The New Yorker" and WNYC revealed just how close Ivanka Trump and Donald Trump Jr. had come to being indicted in that criminal probe over fraud at the Trump SoHo. They came very close to being indicted before. The Manhattan D.A. ended up dropping that case.

The prosecutor says he made up his own mind. It had absolutely nothing to do with the visit and large donation he received from Donald Trump`s long- time personal lawyer while he was considering that case.

A big part of the Trump business model has been Trump and the Trump Organization getting paid to have the Trump name associated with a building they don`t build. Tonight, however, comes this news that the company that owns this building in SoHo, arguably in SoHo, they`re now paying the Trump Organization to get out of the deal early. They`re now paying the Trump Organization to take the Trump name off that troubled building and sever all ties to it.

Joining us now is Andrea Bernstein. She`s senior editor at WNYC.

Andrea, it`s great to see you. Thank you for being here.


MADDOW: Night before Thanksgiving. I know it`s a lot for me to ask you being here. So, I really appreciate.

First of all, just a New York point here -- I know where the Trump SoHo is, I do not think of that as SoHo.

BERNSTEIN: It`s not a SoHo. It`s west of SoHo. It`s the near the mouth of the Holland Tunnel.

MADDOW: Yes, but the aspirational name, Trump SoHo.

BERNSTEIN: The aspirational name like the number of floors of Trump Tower is always higher than they actually are.

MADDOW: You just round up to the nearest thing that sounds good.

OK. So, the reason that Trump SoHo has been of so much interest to people who have been investigating the Trump Organization, potential ties, potential money laundering worries, potential ties to the former Soviet Union, is because the Trump SoHo project was developed with Bay Rock, their partnership in the development there. And that was what gave rise to a lot of concerns over sort of the financing and the origins of that project, right?

BERNSTEIN: That is correct.

MADDOW: OK. In terms of whether or not this was ever a good deal for the Trump Organization, they didn`t build the organization, they developed it. They sold units in it and then they put their name on it.

BERNSTEIN: It was a financial disaster from the get-go.


BERNSTEIN: They announced this building in the fall of 2007, you remember the fall of 2007, the real estate market, particularly the luxury real estate market was already beginning to collapse and they could not sell these units, which is what gave rise to the criminal investigation, the idea that the Trump family might have been lying to lure buyers about the number sold.

MADDOW: And the idea, the way that works is that they`re trying to get people to buy a condo -- not just rent a hotel room, but buy a condo in the building and if you tell them, hey, 90 percent of his place is already sold out, you better get in here. That sounds better than, do you want to come in and be the first buyer, inflating percentage --

BERNSTEIN: Exactly. And they had a strange construct, because they wanted to build a high rise tower in what is -- Trump himself described as a chic arty neighborhood in Lower Manhattan, SoHo. This is a low rise neighborhood. It is zoned for warehouses and low buildings. This is 43 stories high.

So, to build it, they had to create this kind of new kind of hybrid. People can only live there four months a year, then they had to rent it out. People didn`t want to buy that. Even if there wasn`t a financial crisis, it was a very tough product to sell.

MADDOW: And in terms of that proud investigation this is very interesting reporting, it was you guys at WNYC, "The New Yorker" and "ProPublica", and the idea there was that in representing the financial health of the building, that Ivanka Trump herself and Donald Jr., himself, personally corresponded, communicated over e-mail, documents that were obtained by prosecutors, in ways that made clear that they were trying to misrepresent the financial health of the building to buyers. It really seemed like, because they put that stuff in writing, that there was a very strong case.

BERNSTEIN: Right. And there were prosecutors in the D.A.`s office who wanted to proceed with the criminal case. But Cy Vance, though he`s said that the e-mails were damning to a degree, decided that he felt the case was too difficult, by the time he got to it, he said, the victims didn`t want to cooperate and he had been a defense lawyer himself and, so, he saw problems with the case.

But there were -- he basically overruled his team, who had wanted to go forward with the criminal prosecution, who felt that the e-mail evidence was so strong that they could mount a prosecution despite the obstacles.

But it was part and parcel of the problem that the Trump SoHo is still having, which is that it`s this very difficult, strange hybrid to sell. It is a Trump building in a part of Lower Manhattan that sort of -- is attracting a cool kind of a crowd and, you know, we, our office is a block and a half away. So, we used to see NBA stars, limos, rope lines, paparazzi, it was crowded.

And soon after Trump announced his campaign with his racially charged remarks, people stopped coming, until it`s dead. The bar shut down in May. They sort of let all the ingredients run out.

MADDOW: The bar at the hotel shut down?

BERNSTEIN: The bar at the hotel shut down.

MADDOW: You personally investigated this?

BERNSTEIN: We went for research purposes. We ordered drinks. They said, we don`t have these ingredients because we`re letting everything run out because nobody comes here.

MADDOW: What did they let run out first? Do you remember what they didn`t have?

BERNSTEIN: They didn`t have something to make a spicy margarita, I think. I don`t remember exactly what the ingredients were.

MADDOW: It sounds like they ran out of tonic.

BERNSTEIN: It was something obvious.

They ran out of things and then abruptly, the bar closed. The idea is this is a luxury building, the rooms were going to sell for $800 a night, but today, you could find them on Priceline for less than $300. It was struggling.

And people, couples didn`t want to have their weddings there because they were worried, we`re going to bring our family together, some are going to like Trump, some are not going to like Trump, they`re going to fight. We`ll go somewhere else.

So, this building was really struggling. I mean, the problem is now, we don`t know how much money the Trumps were bought out for. The current owners of the building have separately leases with the federal government, they run regulated funds that are regulated by federal regulators. So, we`re in this historically unprecedented situation of a having company making a payoff to the president`s company --

MADDOW: To the president`s family.

BERNSTEIN: And we don`t know what it is. Well, the president is still --

MADDOW: He`s the owner.

BERNSTEIN: He has not die vested. So, we don`t know what that is, and we`re in this situation where we`re left wondering, while they`re having government leases and other regulatory matters decided about them.

MADDOW: Well, if anybody is going to figure that out, I have a feeling it`s going to be you.

Andrea Bernstein, it`s great to see you. Thank you.

BERNSTEIN: Thank you.

MADDOW: I really appreciate you being here.

All right, big night tonight. Stay with us.



ANNOUNCER: NBC Nightly News, Thursday, November 25th. With David Brinkley reporting from the NBC News Center in New York.

DAVID BRINKLEY, NBC NEWS ANCHOR: Good evening. On this day of Thanksgiving and serious eating and counting of blessings, the best we could do here was to count our blessings and have pizza set in cardboard boxes from four blocks away. Happy Thanksgiving.


MADDOW: Grumpy David Brinkley and his crew, apparently got pizza delivered on Thanksgiving in 1976.

We had dumplings tonight. And we`re not grumpy about it at all. And we`ve got one last story for you tonight that will definitely not start a fight at your Thanksgiving table. And that`s next.

Stay with us.


MADDOW: I want to produce you to Mary Moran. In 1973, Mary Moran was 17 years old. She was a high school senior. She`s living in Rhode Island.

And Mary Moran entered an essay contest that the state of Rhode Island held every year. Students were asked to write about what Thanksgiving meant to them.

That year, Mary won that easy contest, but there was something different about her essay. It was so different it made the national news.


UNIDENTIFIED MALE: Mary Moran is 17 years old and a senior at a Roman Catholic high school in Wakefield, Rhode Island. She finished first in the annual statewide Thanksgiving essay contest.

She wrote that Thanksgiving is absurd. Traditionally, the governor issues the winning essay as his Thanksgiving proclamation, but Governor Philip Noel (ph) refused to use Miss Moran`s essay because he didn`t agree with it.

Here she is, reading part of that essay in class.

MARY MORAN, 17-YEAR-OLD: Thanksgiving proclamation, 1973. Today, as many people sit down to a table laden with food, as they go through the motions of thanking God that many no longer believe in, I`m struck by the absurdity of this holiday. Thanksgiving seems to be pretended, a farce, little more than an outdated tradition known as yet found the time of discard. If men gave up this day, he would be forced to admit that he cannot be thankful, but he is not happy, and he is not happy because he is never satisfied.

UNIDENTIFIED MALE: She wrote a very thoughtful message. And one that I think deserves commendation, because of its content. However, I could not bring myself to sign that as my proclamation, because I have never been struck by the absurdity of Thanksgiving as a holiday.


MADDOW: That was her winning essay. Man cannot be thankful because he is not happy, and he is not happy because he is never satisfied. That was her Thanksgivings essay, about how absurd Thanksgiving is.

For the first time in a quarter of a century, that year in 1973, the governor did not issue the winning essay as his Thanksgiving Day proclamation. Instead, he wrote a different one that was not nearly so challenging.

Mary`s principal told "The Associated Press" at the time, quote, she just wrote from the heart.

What was in Mary`s heart was maybe not for everybody back then, but it`s -- you know what? Worth looking back on, even now, maybe especially now.


MORAN: Thankfulness and happiness cannot exist without each other. May man soon realize this and learn again to be thankful.

Mary Moran, class of 1974.



MADDOW: Her classmates got it. Governor didn`t. God bless you, Mary Moran, class of 1974, wherever you ended up.

And happy Thanksgiving to you at home and everybody who helps make this show possible. I`m incredibly thankful for you all, absurdity and the rest of it included.

That does it for us tonight. We will see you again tomorrow.


Good evening, Lawrence.



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