Trump holds rally in Indiana. TRANSCRIPT: 08/30/2018. The Rachel Maddow Show

Guests: Abigail Spanberger, Jeff Horwitz

Show: THE RACHEL MADDOW SHOW Date: August 30, 2018 Guest: Abigail Spanberger, Jeff Horwitz

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

Pop quiz. Ready? American history pop quiz.

Who was the head of the Republican Party at the height of the Watergate crisis? Who was the head of the Republican Party when Nixon resigned?

Poppy Bush. George H.W. Bush was the chairman of the Republican national committee from early 1973 until just after Nixon resigned in the fall of 1974. And when he was head of the Republican Party, in the summer of `73, right after White House counsel John Dean started testifying about Nixon before the Senate Watergate committee, right after Dean had started basically spilling the beans on not only the crime but the cover-up and the Nixon enemies list and all the rest of it.

That summer, July 1973, Republican National Committee Chairman George Bush set out on a listening tour. He traveled to four states to assess the mood of the Republican Party when it came to Watergate. How were the party faithful feeling about Watergate? How was the party coping? How was this playing outside Washington?

We know that did he this and we know what the results of the listening tour were because George Bush wrote this memo about it. Date, July 2nd, 1973. Memorandum to General Alexander Haig, Haig was White House chief of staff, right? From George Bush. You see the initials there next to it, GB.

Dear Al, I prepared the attached mood of the party memo for the president. And then he gives the bottom line. Quote: We`re in fair shape. I expect when we get by those witnesses dragged in by Dean, we`ll be doing OK. All best.

And then indeed there`s this two-page memo that is attached. And the two- page memo is addressed to both General Haig, the chief of staff, and to President Nixon himself. It`s listed as confidential, but no action required.

Here`s what Poppy Bush says. Quote: I have just returned from a four-state visit. See attached schedule, to show types of events. With the exception of the students at the University of Washington, the other meetings were party and press meetings. The press questions he said were 85 percent about Watergate."

And it wasn`t just the press with that fixation. Quote, Poppy Bush says: The party people asked me almost exclusively about Watergate. But he then goes on to describe the overall findings and his listening tour.

Quote: I would summarize the mood as follows: A, the press. He describes them as skeptical. And here, keep in mind, he`s talking about the press that he has encountered on this four-state listening tour outside the beltway, and these four states to which he has traveled.

He says the press out there in the country is, quote, more civil than Washington, D.C. and New York press conferences. For the most part, willing to entertain the thesis that party is not the loser out of the scandal, meaning that the Republican Party as a whole is not being tarnished too much by the Watergate scandal.

B. George Bush then assesses the mood of the students with whom he met. Quote: Unwilling to accept at all my conviction that president is uninvolved in Watergate. Quote, reasonable acceptance of the thesis that party should not suffer because of Watergate. Civil in attitude. Good questions.

And then, finally, he gives his assessment of the mood of the party people. So this is the chairman of the Republican Party at the time, 1973, talking about the base. Talking about how the Republican Party faithful out there in the country, how they`re feeling about this Washington scandal. This Watergate scandal, as John Dean is testifying and as the scandal is really starting to consume official Washington.

According to George Bush, Republican Party chairman, summer of `73, in his assessment, the party people have a, quote, almost unanimous desire to believe that the president is telling the truth. Abhorrence of enemies list, the enemies list that John Dean had testified about, quote, immense frustration about CRP, that`s the committee to re-elect the president beater known as CREP.

All that money sitting there and its continued existence. Remember, this memo was written in the summer of 1973 after the `72 election. So, Nixon had already been reelected. He is saying the party faithful are frustrated that the committee to the re-elect the president still exists with all that money sitting in it, especially if it`s going to turn out to be a slush fund related to the Watergate scandal.

According to Poppy Bush, the party people, quote, also feels the press is playing up Watergate too much. He says the party people have, quote, unanimous distrust of John Dean but some uncertainty as to his testimony. The party people, quote, generally want the president to hold a press conference or speak out. They generally do not feel the president should appear before the Senate committee.

And then he gives his summary. Quote -- so this is George Bush, then head of the Republican Party, right, explaining he`s got this personal conviction that the president was uninvolved in Watergate even if people don`t believe him about that. Here was his conclusion for President Nixon and the White House chief of staff that summer in this confidential memo.

Quote: The party people need shoring up. They want to believe in the president. They are hurt and embarrassed by Watergate. They feel betrayed by Watergate. But when told we will overcome based on the president`s record and party`s principles, they react enthusiastically.

The party people need shoring up.

Tonight, after another difficult day in his own summer of escalating scandal, the current president of the United States definitely set out to shore up the party people. Tonight, the president is in Indiana holding what the White House described as a make America great again rally, promoting support for a Republican candidate who is trying to unseat Democratic Senator Joe Donnelly in Indiana.

Much like President Nixon in the summer of 1973, the whole country knows and the Republican Party itself knows that a crucial factor in how this is all going to work out for the president and for the party is the level of support and enthusiasm and trust that the president continues to inspire from the Republican base, from the party people, right, who George Bush set out to survey in the summer 45 years ago. And both with Nixon 45 years ago and with President Trump tonight, everybody looking at this presidential scandal in a clear-eyed way knows that there`s a connection between the amount of support the president can continue to count on from the party faithful, there`s a connection between that and the extent of his own legal jeopardy.

Yes, the president appears sort of proverbially bullet proof in terms of whether or not this scandal will dent his standing with the members of the Republican base who love him the most. But everybody knows, from American history, even from the history of this president, that you can only take so much before even the party faithful start to wither a little bit in their support of and confidence and trust in the president. And that end up being absolutely crucial as to his ultimate fate and to what happens to the fate of the president and his party together, right?

And the president`s legal jeopardy, the extent of the president`s legal troubles, the extent to which he was drawn into the scandal personally, 1973, that was not yet clear for Nixon either, right? John Dean was just starting his testimony. The Republican Party chairman was still telling everybody he was absolutely convinced that Nixon had no personal involvement in the crime or the cover-up, which he absolutely did.

There`s that level of uncertainty today, as well about how much the president is going to be personally implicated in the scandals that continue to surround him. Today, "The New York Times" broke out another story about this president`s apparent personal involvement in the scandal that has started ensnaring his campaign aides and his business associates, including those who are now flipping against him, a la John Dean.

The president`s personal lawyer, Michael Cohen, pled guilty last week to eight felony federal charges and in so doing in court under oath, the president`s personal lawyer implicated the president himself in two of the felonies to which Mr. Cohen pled guilty both of which were campaign finance charges. Both of those felonies involved a tabloid company American Media and its flagship publication, "National Enquirer."

Well, today, "The New York Times" reports that the president and Michael Cohen, beyond the two hush money payments already implicated in Cohen`s felony pleadings, "The Times" reports that Cohen and Trump also made an effort to buy up all of the dirt and information that the "National Enquirer" and its parent company had stockpiled on Donald Trump as a public figure dating all the way back to the 1980s.

You might remember last week "The Associated Press" reported the American media kept a physical safe, a vault in which everybody knew they safeguarded all their sensitive information about celebrities and public figures that they had obtained but not yet published including information about Donald Trump.

Well, today`s revelation from "The New York Times" is essentially that the president at least tried during the campaign to buy the contents of that safe. Again, two hush money payments related to that company and paid out during the campaign have already resulted in felony charges for the president`s personal lawyer, felony charges in which the president himself has been named as a co-conspirator, right? The president`s lawyer has said under oath that the person who directed the commission of those felonies was the president.

The president`s business is also apparently implicated in the commission of those felonies according to the information filed in court alongside Michael Cohen`s guilty plea.

If that part of this alleged criminal enterprise involving the president now also turns out to involve a greatly expanded universe of derogatory information about the president, that the campaign may have been trafficking or trying to buy for purpose of influencing the election, well, who knows where that`s going to go?

But when things came to an end in the Watergate scandal, it was because of a Supreme Court ruling. A unanimous ruing from the United States Supreme Court which ordered the president to comply with a court ordered subpoena to turn over the White House tapes. That`s what resulted in the public release of those White House tapes. It was the public release of those tapes which really broke the dam in terms of Republican support for Nixon, realizing that he would likely be impeached and removed from office including by many votes from members of his own party in Congress, President Nixon then resigned.

That case at the Supreme Court that led to that outcome is legendary because it had such profound consequences. But as a matter of law, that Supreme Court ruling is not seen as controversial, right? It was a unanimous ruling for one, including for judges who`ve been appointed by President Nixon. Since Watergate, that ruling has been seen as a bedrock of modern jurisprudence that problems in America, even U.S. presidents can`t break the law or defy the law with impunity.

There`s a lot of rulings very well-known because they`re the source of controversy. U.S. v. Nixon is very well-known but not because it`s the source of a controversy. It`s not a controversial ruling.

That said, President Trump`s Supreme Court nominee Brett Kavanaugh has very unusually suggested publicly that, quote, maybe U.S. v. Nixon was wrongly decided.

And now, today, Democrats in the Senate have announced one of the witnesses they will call to testify next week at the confirmation hearings for Brett Kavanaugh will be Richard Nixon`s old White House counsel John Dean, who came clean with the Senate Watergate committee and told them all about the crime and all about the cover up and that ultimately resulted in the dominos starting to fall that resulted in the end of the presidency.

John Dean is going to testify against Brett Kavanaugh. Specifically, we expect on the issue of executive power and Kavanaugh deriding the result of U.S. versus Nixon. I mean, if this White House right now is at all trying to swim its way out of the comparisons of this president`s scandals and Watergate, and indeed, the unfavorable comparison of this White House to the Nixon White House in the Watergate era, it turns out they`re swimming against very, very strong, very fast historical currents here.

So, we`re going -- we`re going to have more coverage on that tonight including, we`ll have an interview tonight with the reporter who first broke the news about the "National Enquirer" and its safe full of compromising information, including on the president.

But I also want to give you an update on a story that was strange when we talked about it on last night`s show for the first time. It is a story that has since gotten a good deal stranger today.

As you know, one of the main determinants of what`s going to happen next in American political history and with this presidency is the fate of the U.S. Congress, and what`s going to happen with the midterm elections that are now just a couple months away, 68 days away, to be exact. It will be a seriously uphill battle for them to do so. But the Democratic Party is putting absolutely everything it`s got into an effort to take back control of the House of Representatives.

In order to do that, they`re going to need to take a couple of dozen seats that are currently held by Republicans and they`ll need to flip those seats Democratic. And every competitive district is different all around the country, right? Every state, every locality has its own issues, its own personalities, its own dynamics to contend with. So, there`s all sorts of different approaches, as many different approaches as there are different congressional districts at stake this fall in terms of how Democrats are approaching, trying to win individual seats and thereby contribute to flipping the House.

But there is a theme that you can see, even from a distance in the Democratic effort. And whether it`s a deliberate effort on the Democratic Party`s part or not, it so happens that there are a ton of Democrats running this year trying to flip competitive seats who are Democrats with military backgrounds, intelligence backgrounds, law enforcement background. There`s just a ton of Democratic candidates this year in lots of crucial districts where the Democratic candidate has national security qualifications on his or her resume.

We know that in part because the Democratic Party is keeping a list of those types of candidates. Scrolling by, this is the list of Democratic congressional candidates this year by name and by the state and congressional district in which they`re running. That formed the distribution list to which the Democratic Party sent a letter this week warning all these Democratic candidates that because of their national security background, because they may have qualified for security clearances, either currently or in the past, they should be on the lookout for potentially being doxed by the Republican Party or by the Trump administration. This is that letter from the Democratic Party to these candidates which I referenced the existence of last night. We`ve now obtained the letter.

Quote: Dear friends and future colleague, it has come to our attention that the congressional leadership fund, a super PAC with connections to House Speaker Paul Ryan, has somehow obtained and is distributing an unredacted questionnaire for national security positions. An SF-86 form from one of our candidates, Abigail Spanberger, a former CIA officer and law enforcement agent.

Quote: We are unaware of any way that this unredacted form could have been obtained legally. As an individual who has served our federal government either in the military or in a national security capacity, you likely know that an SF86 is the most comprehensive document anyone seeking a security clearance with the federal government must complete. In this case, the document the Paul Ryan super PAC circulated was not redacted and contained sensitive, private information including the candidate`s Social Security number and full medical history.

I write you today in the likelihood that you also filled out an SF86 in your service to our country and to warn you of this super PAC`s disturbing behavior in this case. The letter goes on for a while. It concludes with a warning to these Democratic candidates who have national security backgrounds that they need to be particularly vigilant about their security, reminds these candidates that they can avail themselves of a senior team specifically dedicated to cyber security from the Democratic Party if these candidates feel like they have need of it.

So, here`s the Democratic Party. A couple months out from the election, saying to all its candidates who have national security background, hey, watch out. New threat that applies specifically to you. It`s a remarkable story.

We first learned that this candidate Abigail Spanberger`s security application had been obtained by a Republican opposition research group and then by Paul Ryan`s PAC, thanks to this is "New York Times" article which broke late on Tuesday night. Abigail Spanberger was a CIA case officer for years working primarily on counterterrorism issues. Before her CIA career, she also worked as a federal agent on the law enforcement side of the U.S. postal service.

What has been clear from the beginning of this scandal since it first broke is that Abigail Spanberger`s security application really has been circulated by this Paul Ryan super PAC, and they really have been using it against her in her congressional campaign despite the fact that it`s not legal for them to have it. What has not been clear until today is how they got it in the first place.

Candidate Abigail Spanberger wrote to the group a couple of days ago and put it in blunt terms. Quote: It has come to my leadership that the Congressional Leadership Fund, this PAC, has somehow retained a full unredacted copy of at least one of my SF86 documents and has disseminated this document for political purposes. In fact, I have clear evidence that your group has provided this to at least one news outlet. I`m not aware of any legal way that your group could have this document.

Well, that concern was echoed today in a new letter signed by over 200 national security personnel. People with experience at the CIA and military and National Security Council and elsewhere. They released this letter to the director of Office of Personnel Management and director of national intelligence. It says, quote: Neither we nor national security law experts we`ve consulted are familiar with any previous case of an SF86 being released in full to include Social Security number and medical history. We have yet to hear an adequate explanation as to why Ms. Spanberger`s sensitive personal information was released and subsequently made public by Paul Ryan`s political action committee.

Quote: Each year, thousands of aspiring public servants file the same document hoping to serve to their country just as we did. They must be confident that their information will be handled securely and never released pursuant to a political agenda.

Well, her security application is being used now for a political agenda against her. We still don`t know why this incredibly sensitive document was released to a Republican oppo research firm. As noted as far as we can tell, it is a totally unprecedented breach.

As of today, though, we do know how that oppo research firm and Paul Ryan`s PAC did obtain it. The U.S. Postal Service put out a statement today admitting they did it. They said it was an accident. They`re apologizing for it.

Quote: The Postal Service deeply regrets our mistake in inappropriately releasing Ms. Spanberger`s official personnel file to a third party which occurred because of human error. We take full responsibility for this unfortunate error and we have taken immediate steps to ensure this will not happen again. The Postal Service intends to change our process for handling requests for personnel file information to provide further protection against its inadvertent release and to ensure that such requests are properly handled in the future.

Quote: We are continuing our review -- get this -- but we believe the issue began in June 2018 and that only a small number of additional requests for information from personnel files were improperly processed. Oh, there is more?

So, security clearance applications are among the most sensitive personal documents that the government safeguards about federal officials. They are not subject to Freedom of Information Act requests particularly against firm who`s want to use them against people running for office. But in this case, the U.S. Postal Service for some reason handed over this candidate`s full unredacted file in response to a FOIA request from this Republican oppo research group.

The Postal Service now says they`re very sorry. But oh, by the way, it wasn`t just her. A small number of additional requests for information from personnel files were improperly processed. Beyond this one, others were improperly processed.

Paul Ryan`s super PAC is not just active in the field against this one congressional candidate, Abigail Spanberger, who is running to try to replace Dave Brat in Virginia. Paul Ryan`s PAC is operating all over the country trying to pick up Democrats who pose a threat to Republican-held seats.

Well, how many more requests like this did they make against how much other candidates with national security backgrounds? The agency that did this thus far is not saying how many other people they did this to. So, it definitely happened to Spanberger but who else did it happen to as well?

From "The Daily Beast" today, quote: The agency is not answering questions about how many federal officials had their personnel files processed and whether those files were released and to whom. So, we don`t know who else this happened to.

But even in just this one instance that we know about, we`re also confronted with the fact that the Republicans here, the super PAC controlled by the House Speaker Paul Ryan, they obtained this had document they never should have obtained, let alone circulated. They circulated it. They`re apparently completely unrepentant about that. Their justification for using this document to try to hurt Spanberger`s candidacy is that it was maybe sent to them mistakenly, but it was sent to them so too bad.

This is like if you went to the ATM, you popped in your ATM card, you withdrew 20 bucks from your account and after you got your 20 bucks out of your account, the ATM started beeping crazily and just spit you out 20,000 bucks all from somebody else`s account. Right?

Do you just expect to be able to put that in your pocket and walk off? Score. I asked for it fair and square. I didn`t -- well, it`s mine now.

I mean, in this case, we`re not talking about money. We`re talking about sensitive national security information. But it does seem astonishing is that apparently the plan is that they`re just going to keep using it. Keep using it. Why not? Who`s going to stop them?

Joining us now is Abigail Spanberger, Democratic nominee for Virginia`s 7th congressional district running to try to unseat Republican Congressman Dave Brat.

Ms. Spanberger, thank you very much for being here tonight. I appreciate your time.

ABIGAIL SPANBERGER, FORMER CIA OFFICER: Thank you for having me on, Rachel.

MADDOW: So we`ve seen this story unfold over just a quick few days. What do you think of the current explanation we`ve got now that the release of this very sensitive document from your time applying as a federal law enforcement officer and a CIA officer, it was always released just as an accident?

SPANBERGER: Well, that is -- that is the explanation that they`ve given. And, frankly, it doesn`t remove or change the fact that my document was released in violation of the Privacy Act and that it was given to this research firm and that it was later then circulated and provided to journalists. So, I`m incredibly disappointed that this human error, which was resulted in a violation of law so profoundly impacted me but I am really glad it came to light because I want to ensure this doesn`t happen to other people in the future.

MADDOW: As far as you know in terms of the response from the administration thus far, have they notified any of the other people who may have been subject to the same kind of breach? They made reference today in their formal statement about this matter that there may be others whose personnel files with who knows what`s in them, may have also been breached. Do we know if they`ve made further contact with other people who might have suffered what you did?

SPANBERGER: I do not know that, no.

MADDOW: OK. I just want to ask you about a matter of timing here. So, the conservative PAC, the Republican groups that obtain the information, they apparently got this paperwork by accident through a Freedom of Information Act request that should not have been responded to the way it was.

As far as I understand it from the "New York Times" reporting, a firm hired by you to help essentially prepare for your own campaign also filed a Freedom of Information Act request for your own records months and months ago at the end of last year, and as far as I`m told, the firm working for you that filed that same request for your information still hasn`t gotten anything but this Republican group appears to have had a zip, zip, very quick, less than a month turnaround in terms of how quickly they got their information.

SPANBERGER: That`s correct. It is typical for campaigns to file research requests for themselves. So, we hire a firm to research me. And they did submit Freedom of Information Act requests back in September of 2017 and as of right now, we have not received any information either from CIA or from the U.S. postal service related to my time as a federal agent or a case officer with the CIA.

MADDOW: So, you asked for this information on yourself. You`re waiting nine months now and you still haven`t gotten anything. We know from the timing as explained by this Republican group that they got a response including your unredacted security clearance application, they got it -- they had it in hand within three weeks of them first making a request.

That timing seems nuts. I don`t know if you have any explanation or any suspicions about that.

SPANBERGER: I don`t have an explanation for it. I would echo your sentiments. You know, as you noted in the opening, a FOIA request wouldn`t typically or wouldn`t result in receiving an SF86 which is the national security questionnaire and certainly not an unredacted one, which as you mentioned included my full medical history, my Social Security number, every place I`ve lived, every roommate I`ve ever had, basically, all the information you entrust to the federal government when you ask in exchange they provide with you a security clearance and trust with you state secrets.

MADDOW: Last question for you here, you are part of a -- what appears to be a real wave of Democratic candidates running this year, particularly first time candidates who do have a national security background, people of law enforcement, military, intelligence, diplomatic, foreign service background. I wonder if you think that`s a coincidence or if there is something about our politics in this moment this year at this time with Democrats opportunities that effort to take back the House which would really change Washington fundamentally I think right now, is it a coincidence? There are so many with the background you have that are all running right now. Or you think it`s sort of -- do you think it`s a moment for the Democratic Party right now we should see as a national trend?

SPANBERGER: I think it is a national trend. When you look at the fact that we did have a super PAC that was pushing out my personal information, my Social Security number, my medical information, you know, in attempts to have a personal gain, it speaks to how broken our system is, it speaks to what is wrong with our political system and I think there are so many of us who have served in various ways in the military and intelligence community, in law enforcement, who are driven to serve the mission of protecting this country and upholding the Constitution and this situation is just emblematic of how bad things are in politics.

You know, you expect to be hit with a couple of attack ads here or there I suppose, but this is just beyond the pale and what it does and what it signals to anyone who might currently be in federal service who has filled out an SF86, a national security questionnaire, you know, I think there`s probably people around the country taking pause of what might happen with the information they thought was safe. And so, so many of us who are running were running because we want to stand up what`s right and we want to get this country back on track and be part of change, of changing not just the tone of the conversation in Washington, but really standing up for the principles of just right and wrong, and the fact that this information was put out in violation of law either by human error or otherwise, you know, that was the first mistake.

But then the second mistake is that an organization would know that they received this in error in violation of the law and would continue to push it out. And so, you know, for those of us who are running, we`re running because we want to stand up for what`s right and bring our voices to Congress, and I`m excited to be part of this wave because I think this is just one more example of the fact that people want to focus on service to country and mission of upholding the Constitution, that`s exactly what we need in Washington at this time.

MADDOW: Abigail Spanberger, former CIA officer, Democrat running for Congress in Virginia, 7th district -- thanks very much for joining us tonight. I`m sorry this happened to you, but thank you for allowing it to come to light so we can put out the radar at the possibility it may happen to others, as well. Thank you.

SPANBERGER: Absolutely. Thank you.

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

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MADDOW: One more thing about that congressional candidate we just hosted here on the show, Abigail Spanberger. She`s that ex-CIA officer, whose security clearance information was mysteriously sent out by the Trump administration to a Republican opposition research firm and since then it has been circulated by Paul Ryan`s PAC. As I mentioned in that interview, she is running in Virginia in a race where she is trying to unseat Tea party Republican Dave Brat.

You might remember Dave Brat as a national figure because Dave Brat unseated Eric Cantor. House Majority Leader Eric Cantor used to be the congressman there. Dave Brat beat him in a primary there.

Now, that seat, Virginia 7th district, it has been seen as a safe Republican seat for a long time. That district has been held by a Republican since 1971. But times are changing.

"The Cook Political Report" for this year lists that race as a toss-up, in part because Abigail Spanberger is a strong candidate for the Dems but also because Dave Brat isn`t that popular as an incumbent Republican member of Congress. And Virginia Republicans in general are not having the easiest time of it in the Trump era of the Republican Party.

Elections last year in Virginia, the state elected a Democratic governor, a Democratic lieutenant governor, Democratic attorney general, and there was a huge swing toward the Democrats in the state legislature, as well. Well, now, today, more help for the Democrats` hopes of flipping red congressional seats in Virginia. More help for Democrats today, courtesy of the president of the United States.

Much to everybody`s surprise today, the president announced without warning that he is canceling an otherwise automatic, across the board pay increase for almost 2 million federal workers. Where do a lot of federal workers live? It`s a cost of living allowance. A 2.1 percent raise that was due to go into effect for civilian federal employees in January, including lots and lots of them all over the country but lots of them in particular in places like Virginia.

The president just stabbed the pocket book of something close to 150,000 voters in Virginia who also happen to be federal employees. Virginia Republican Congresswoman Barbara Comstock is probably the most endangered incumbent Republican member of Congress in the whole country. She`s fighting for her life trying to hang on to her seat against a strong challenger, Democratic State Senator Jennifer Wexton is her challenger.

That race is currently listed by "The Cook Political Report" as lean Democratic despite the fact it has an incumbent Republican serving there now. In reaction to the president`s announcement about this pay rise, Congresswoman Comstock put out this statement saying she strongly opposes eliminating the pay raise for civilian federal employees and will work with my colleagues to have the pay raise included in our appropriations.

The same sound really coming from Congressman Scott Taylor. He`s another Virginia Republican who`s got some scandals of his own and he is facing a tough re-election fight against a Democratic business woman, former Navy vet named Elaine Luria. He came out immediately against the president`s proposal today.

Quote: The administration`s announcement to freeze cost of living adjustment for federal and locality pay areas is completely unnecessary and a disappointment for the 30,000 federal employees in the area, meaning in my district, who are way overdue for a pay increase. Taylor says, quote: I oppose this decision and will lead an effort to reverse its effect.

This president`s fate probably depends on who holds Congress after the November elections. This president has said he intends to do everything he can to help get Republicans elected to the House all over the country. Well, now, he`s got at least these House Republicans in Virginia, having to started running against him on this thing he inexplicably did today.

As for Abigail Spanberger, her opponent, Republican Congressman Dave Brat, so far he hasn`t said anything about this at all. Crickets so far. We`ll see how long that lasts.

Much more ahead tonight. Stay with us.

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MADDOW: "The New York Times" reports today that shortly before the 2016 election, Donald Trump and his personal lawyer, Michael Cohen, had a plan to not just have the "National Enquirer" buy the silence of a woman who claimed to have had an affair with Mr. Trump. A transaction for which Michael Cohen has now pleaded guilty to campaign finance violations, but according to "The Times", they also had a plan to buy all the damaging stories that publication had buried on Donald Trump`s behalf, going back several decades.

"The Enquirer`s" Trump files were described at the times as, quote, mostly older "National Enquirer" stories about Mr. Trump`s marital woes and lawsuits, related story notes, and lists of sensitive sources, some tips about alleged affairs and also minutiae like allegations of unscrupulous golfing.

What is scrupulous golfing though really when you think about it? I kid, I kid. Don`t be mad.

We learned last week that the "Enquirer`s" parent company AMI had kept all those materials on Trump and other people in a safe. But according to the "A.P.", an executive from the company removed the essential I have the items in the weeks between the election and the inauguration. The current whereabouts of those documents and materials are unknown.

Well, that executive supposedly moved the stuff, he`s now been given immunity by federal prosecutors, as has AMI chairman and Trump friend David Pecker.

When the reporter who broke that story about the safe, Jeff Horwitz of "The Associated Press" came on our show last week, he kind of intimated that there might be another important component to the story that hadn`t yet been told. Well, now that hint of more to come has paid off in reporting and that`s next.

Stay with us.

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MADDOW: So, this is new from "The Associated Press".

Quote: "The National Enquirer" has long explained its support for Donald Trump as a business decision, based on the president`s popularity among its readers. But private financial documents and circulation figures obtained by "The A.P." show that the tabloid`s business was declining even as it published stories attacking Trump`s political foes and prosecutors claimed helping suppress stories about his alleged sexual affairs.

According to "The A.P." today, the "Enquirer`s" parent company AMI lost $72 million last year and the "Enquirer`s" average weekly circulation fell by 18 percent. And yes, times are tough in the publishing business but that drop is bigger than anything else that American Media owns. And as further explained by "The A.P.", before the "National Enquirer" lost 18 percent circulation this year, it lost 15 percent circulation the year before that which was during the election.

So, their finances aren`t what they seem and the supposed business decisions they were making about their coverage of Donald Trump appeared to have not made much sense as business decisions. And now, two of their top executives have been granted immunity by prosecutors. What`s going on?

Joining us now is Jeff Horwitz, reporter at "The Associated Press" who first broke the news about the AMI safe containing its buried and salacious information that it had not published and now has broken this news about AMI`s finances.

Mr. Horwitz, thanks very much for being here.

JEFF HORWITZ, REPORTER, THE ASSOCIATED PRESS: Glad to be back.

MADDOW: So, when we spoke a if you days ago about your last scoop about the safe, you suggested that it might be interesting or it might help us sort of fill in our understanding of what`s going on here to have a better understanding about AMI`s financial situation, basically how it`s running as a business. Now that you`ve obtained this information saying that things appear to be sort of dire there, how does that help you understand what`s going on with that company and how it relates to the president?

HORWITZ: Well, unfortunately, it leaves me with a pretty big mystery still, which is why AMI would be spending its fairly tight money, $150,000 on Karen McDougal, allegedly, to basically do something that won`t boost the circulation and didn`t even sell all that well to readers. Now, I will have to say that coverage attacking Hillary Clinton may have added some value to the "National Enquirer", but it doesn`t look like going sort of whole hog on Donald Trump in support really did much for the publication at all.

And so, at that point, you have to ask a question about one, why David Pecker and Dylan Howard, who were sort of the top figures at AMI, why they did that, but two, why their owner, which is a hedge fund in New Jersey, would have allowed them to do it.

MADDOW: In terms of David Pecker and Dylan Howard, those executives that you mentioned, it has been reported that they are cooperating, at least to some extent with prosecutors. Obviously, AMI was implicated in the criminal information that was described by prosecutors when Michael Cohen pled guilty to two felonies related to some of these hush money payments and AMI seems to have been involved as an entity in those payments.

Do we have any clearer sense of why these executives might have been offered immunity, the extent of their cooperation, or whether or not the company itself might potentially have some legal jeopardy here beyond just these executives themselves?

HORWITZ: Yes. So, companies can`t be granted immunity and we are unaware of any reason to think that AMI would be out of the woods here. But with the executives themselves, I mean, these were the two guys that were directly interacting with both Trump and the campaign. I`m sorry, with both Michael Cohen and the campaign from everything from sort of clearing pictures and discussing stories that content they`d like to see run in the "National Enquirer" to obviously discussion of Stormy Daniels and Karen McDougal and how to handle those situations.

So, those guys would have known a great deal about both the "National Enquirer`s" historical relationship with the president, which as you and "The Times", those stories, it goes way back, and also the happenings in the 2016 campaign.

MADDOW: Jeff Horwitz, reporter at "The A.P." who has been a bit of a scoop machine on this story, which is obviously still continuing to evolve at very high stakes. Jeff, thank you for being here. Congratulations on your latest.

HORWITZ: Thanks.

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

(COMMERCIAL BREAK)

MADDOW: In the days immediately following Hurricane Katrina, hitting New Orleans, then President George W. Bush took one of many, many, many public missteps to come.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, FORMER PRESIENT: Right now, the immediate concern is to save lives and get food and medicine to people so we can stabilize the situation. Again, I want to thank you all -- and, Brownie, you are doing a heck of a job. The FEMA director working 24 hours --

(APPLAUSE)

They`re working 24 hours a day.

(END VIDEO CLIP)

MADDOW: Hurricane Katrina was a total disaster. And not just a natural one, but a manmade one, too, thanks in part to a sluggish, incompetent, inadequate poorly planned, poorly managed response by the George W. Bush administration and the federal government more broadly. The botched handling of Hurricane Katrina cost over 1,800 Americans their lives.

Heck of a job FEMA Director Michael Brown was soon out. And President George W. Bush was haunted until the end of the presidency by that line, Brownie, you`re doing a heck of a job. Really? Was he?

I mean, one lesson to be gained from this is don`t be so quick to pat yourself on the back, right? What about when you start patting yourself on the back way, way after the fact, after it`s crystal clear how badly you did.

This week, Puerto Rico announced that it has had to raise the death toll associated with Hurricane Maria from 64 deaths, which had been the previous death toll, to now 2,975 lives lost. Almost the exact same number of Americans who were killed in the 9/11 attacks. Over 1,000 more Americans killed in Puerto Rico and Hurricane Maria than were killed on the gulf in Katrina.

But for some reason, these facts about what went wrong and the response to Hurricane Maria and how wrong it went have not made their way to the oval office or maybe they just took a wrong turn on their way to the president`s head.

(BEGIN VIDEO CLIP)

REPORTER: Mr. President, on Puerto Rico, do you still believe that the federal government`s response to the hurricanes last year --

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Yes, I think Puerto Rico -- I think we did a fantastic job in Puerto Rico.

(END VIDEO CLIP)

MADDOW: Fantastic job. Fantastic job on the day after Puerto Rico had to up its death toll from the storm to 2,975 Americans killed. Fantastic job.

That has to go down in the annals in Michael Brown, heck of a job. Doesn`t it? Doesn`t it?

(COMMERCIAL BREAK)

MADDOW: Last year in early November, they said it would definitely be over by Thanksgiving. Then, on Thanksgiving, when it became clear that it wasn`t over, the president`s lawyers amended their deadline and said, oh, we were wrong about Thanksgiving. OK, it will be over by the end of the year.

Then at the end of the year, when it wasn`t over, they said, oh, missed it by that much. We were close. Actually, we now understand it will all be over at the end of January.

End of January arrives. It arrives and leaves. It is still not over.

Then by May of this year, six months after the Trump lawyers original deadline by which they said the whole thing would be done, turned out the special counsel`s investigation of the president and his campaign still was not over. So, Rudy Giuliani, the president`s new lawyer then apparently decided it was time to lay down the law, to end this thing once and for all. He proclaimed that September 1st would be the actual end. September 1st would be the end of the Robert Mueller investigation of the president.

As you may have noticed, September 1st is quickly approaching, day after tomorrow quickly. And while, sure, the Mueller investigation could end then, the president`s lawyers` track record on these things is quite literally a complete failure on every front.

Do these blown deadlines eventually annoy the president, though? Find out on Saturday. Watch this space.

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

Now, it`s time for "THE LAST WORD WITH LAWRENCE O`DONNELL".

Good evening, Lawrence.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED. END

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