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The Last Word with Lawrence O'Donnell, Transcript 09/22/15

Guests: Sam Stein, Eliana Johnson, Ezra Klein, Bruce Western

RACHEL MADDOW, MSNBC HOST: And in some cases, historically -- be attended by 30,000 people. That`s all on top just for tomorrow, the rest of the weekend into the weekend will be similarly larger than and in some cases historically, unprecedented events by this papal visit. But we`ll bring it all to you starting tomorrow including live tomorrow night from Washington D.C. -- that does it for us tonight, we`ll see you again then. Now, it`s time for THE LAST WORD with Lawrence O`Donnell, good evening -- LAWRENCE O`DONNELL, MSNBC HOST: So Rachel, you -- MADDOW: Yes -- O`DONNELL: Go where the pope goes, right? You`ll be back here in New York when the pope is in New York? MADDOW: He insists that I follow him from a distance of about 400 yards. O`DONNELL: OK -- MADDOW: Yes -- (LAUGHTER) O`DONNELL: All right, I get it. MADDOW: It`s between me and him. O`DONNELL: OK -- MADDOW: Yes, thanks, Lawrence -- (LAUGHTER) O`DONNELL: Thanks Rachel. Well, Donald Trump obviously has no idea that - - reform is a major Republican issue. Republicans have long claimed that frivolous lawsuits are ruining this country. But the frontrunner for the Republican presidential nomination is the king of frivolous lawsuits. And tonight, he is threatening to sue Republican opponents for running attack ads against him. (BEGIN VIDEO CLIP) BILL O`REILLY, FOX NEWS: This tweeting thing, that`s like the worst thing you can give Donald Trump. UNIDENTIFIED FEMALE: Trump goes on a Twitter tirade against "Fox News". He said he had a hard time watching the cable network and took aim at Bill O`Reilly. O`REILLY: This is just theater right now and he gets a lot of attention from the theater -- UNIDENTIFIED MALE: Anybody that buys this malarkey is -- probably deserves what they get. UNIDENTIFIED FEMALE: Donald Trump still formidable, a drop slightly in the polls. UNIDENTIFIED MALE: It must have been something he said or did or is. (LAUGHTER) UNIDENTIFIED FEMALE: The frontrunner turning his attention to Fiorina. DONALD TRUMP (R), PRESIDENTIAL CANDIDATE: If you hear her for periods of time, you get a -- you get a big, fat, beautiful headache. CARLY FIORINA (R), PRESIDENTIAL CANDIDATE: Contrary to some caricatures, I`m quite soft spoken actually. (LAUGHTER) HERMAN CAIN, BUSINESSMAN: I like it, I like it, I like it. UNIDENTIFIED MALE: A historic day. (CHANTING) CROWD: Welcome to the USA! UNIDENTIFIED FEMALE: President Obama personally greeting Pope Francis -- CONAN O`BRIEN, COMEDIAN & TELEVISION HOST: Or as Donald Trump put it, Obama is letting yet another Hispanic guy in. (LAUGHTER) (END VIDEO CLIP) O`DONNELL: The Republican war on the Republican frontrunner for the party`s presidential nomination intensified today, the day after Governor Scott Walker dropped out of the presidential race and encouraged other low- polling Republican candidates to follow his lead and unite in opposition to Donald Trump. (BEGIN VIDEO CLIP) GOV. SCOTT WALKER (R), WISCONSIN: I will suspend my campaign immediately. I encourage other Republican presidential candidates to consider doing the same so that the voters can focus on a limited number of candidates who can offer a positive, conservative alternative to the current frontrunner. (END VIDEO CLIP) O`DONNELL: Today, Donald Trump`s lawyers did what they always do when Donald Trump is criticized. They threatened to sue. This time, Trump`s legal threat is aimed at the conservative anti-tax group Club for Growth who created this attack ad against Donald Trump. (BEGIN VIDEO CLIP) UNIDENTIFIED MALE: Which presidential candidate supports higher taxes, national healthcare and the Wall Street bailout? It`s Donald Trump. TRUMP: In many cases, I probably identify more as a Democrat. UNIDENTIFIED MALE: Trump wants us to think he`s Mr. tell-it-like-it-is, but he has a record, and it`s very liberal. He`s really just playing us for chumps. Trump, just another politician. TRUMP: In many cases, I probably identify more as a Democrat. (END VIDEO CLIP) O`DONNELL: Trump`s lawyers rushed to protect their candidate from the truth by sending a letter to Club for Growth saying that the ad contains libelous statements and is defamatory. The letter demanded that Club for Growth immediately stop running attack ads or face, "a costly litigation process". This afternoon, Club for Growth President David McIntosh responded. "Tough guy Donald Trump starts whining when his liberal record is revealed. Trump has advocated higher taxes numerous times over many years, just like he`s advocated for universal healthcare, the Wall Street bailout and expanded government powers to take private property. Trump`s own statements prove that our ads are accurate, they will continue to run. We suggest that Donald grow up, stop whining and try to defend his liberal record." Donald Trump whined on Twitter for 12 hours, starting last night when he began criticizing Bill O`Reilly`s Trump discussion on his "Fox News" show. Trump tweeted, ""O`Reilly Factor", why don`t you have some knowledgeable talking-heads on your show for a change instead of the same old Trump haters. Boring!" Donald Trump then continued tweeting about it well into this morning after Bill O`Reilly appeared on "The Today Show". (BEGIN VIDEO CLIP) O`REILLY: I`ve known Trump a long time. He wants people to like him. When people criticize him, he takes it personally. And then, you know, this machine, this tweeting thing, that`s like the worst thing you can give Donald Trump is this tweeting thing. So I just think this is just an extension of his reality show, "The Apprentice". This is -- this is just theater right now and he gets a lot of attention from the theater. (END VIDEO CLIP) O`DONNELL: Joining us now Eliana Johnson, Washington editor of the "National Review"; one of our oldest conservative journals, Sam Stein, senior politics editor and White House correspondent at "Huffington Post"; one of our newest journals. He`s also Msnbc political analyst and Joy Reid, Msnbc national correspondent. Joy, Donald Trump`s lawyers, who I hope he`s not paying them by the hour. I hope -- SAM STEIN, SENIOR POLITICS EDITOR & WHITE HOUSE CORRESPONDENT, THE HUFFINGTON POST: Yes -- O`DONNELL: He just has them on an annual retainer for -- JOY REID, MSNBC NATIONAL CORRESPONDENT: Yes -- O`DONNELL: All the frivolous lawsuits because this one might be the funniest Trump threatened lawsuit of all time, which, of course, he will not do. Absolutely no conceivable legal grounds for suing over that ad. REID: Well, my plan though is Lawrence, you and I should form the law offices of O`Donnell and Reid, we should just really take that contract because we`re going to make a lot of money. He just let people -- I think we`re finding out what happens when it stops being fun for Donald Trump. He doesn`t like the idea that he`s being questioned. But I have to say, the most ironic word in that ad by the Club for Growth is us. Because who is us? The Club for Growth represents the very donor class that the Trumpistas are rebelling against. And the problem with that ad is that the Club for Growth has stood for nothing other than the proposition that very rich people should continue in perpetuity to get deeper and deeper tax cuts while the social safety net is unnecessary as our most government services. Well, you know what? Trump`s core base of white working class voters use those government services, want to continue social security and Medicare, which the Club for Growth would like to get rid of. And they don`t care if Donald Trump used to identify as a Democrat. They honestly do not care what the donor class of the Republican Party thinks, says or puts in its ads, and they`re not us. O`DONNELL: Let`s look at another ad from the Club for Growth which they will continue to run since Donald Trump`s lawyers, of course, don`t know what they`re talking about. Let`s watch this one. (BEGIN VIDEO CLIP) UNIDENTIFIED MALE: The Supreme Court`s Kelo decision gave government massive new power to take private property and give it to corporations. Conservatives have fought this disaster. What Donald Trump say about the decision? TRUMP: I happen to agree with it a 100 percent. UNIDENTIFIED MALE: Trump supports eminent domain abuse because he can make millions, while we lose our property rights. Trump, the worst kind of politician. (END VIDEO CLIP) O`DONNELL: Eliana Johnson, apparently no one told Trump or the Trump lawyers that frivolous lawsuits are something that the Republican Party has been complaining about for a long time. ELIANA JOHNSON, WASHINGTON EDITOR, NATIONAL REVIEW: Well, I think what`s most problematic for Trump is that the two lawsuits that have come up in the course of the election involve people who are using Trump`s own words against him. The first was when a reporter wanted to take an excerpt from one of Trump`s old books involving claim of spousal rape. And as I`m sure many of your viewers will remember, his lawyers came back at the reporter and said defended spousal rape, said that -- said that it doesn`t exist, and then said threatened to ruin the reporter`s reputation. And now the Club for Growth is using Trump`s own words against him, and again, he`s being threatened by Trump`s lawyers, so he might want to perhaps -- I`m not sure if he`s getting the most effective legal representation. O`DONNELL: Yes, just to clarify how that went. The book in question included information about Trump`s first wife, claiming of some form of violence between them at a certain point. And Trump threatened to sue over that, and then, of course, didn`t. But Sam Stein -- STEIN: Yes -- O`DONNELL: The idea that the frontrunner for the Republican nomination thinks you get to sue over attack ads is yet another revelation of just how ignorant Donald Trump is about how this works. STEIN: You don`t get to sue? (LAUGHTER) Is that what you were saying? Good, this is -- it`s funny. I was thinking about this today because for a while, Donald Trump was in many respects a bizarre hero for the campaign finance reform movement. Which said that he was calling out all these other Republicans for being on the line with special interest donors, for having to take lobbyist money. And he was going to sell fund, he was exposing the system because he had been part of that donor class and he was telling all the secrets. And there`s one person I talked to who said, actually, you know what? We shouldn`t go and reward him hero status yet because he`s going to start throwing around his money in ways that any other average person would be unable to do. And what we`re seeing right now is the case where if they`re entitled, very rich person running for president thinks that his money entitles him to do things that are just totally illogical and without legal merit. And so the whole idea of Donald Trump as the hero of campaign finance reform advocate is kind of silly in retrospect, now that he is threatening multi-million dollar lawsuits against public -- against public interest groups. O`DONNELL: Yes, but he`s not actually going to do this lawsuit -- STEIN: Of course -- O`DONNELL: Because you know -- STEIN: But he at least (INAUDIBLE) of threatening today -- (CROSSTALK) O`DONNELL: Threatening, and this war he`s getting himself in with "Fox News" continues tonight, I`ve just been handed a tweet he did about Megyn Kelly, some probably within the last hour during her show. He said, "do you ever notice that lightweight Megyn Kelly constantly goes after me, but when I hit back, it is totally sexist? STEIN: Can I make the point -- O`DONNELL: She is -- STEIN: That he -- O`DONNELL: Highly overrated" -- STEIN: Watches -- can I make the point he watches so much TV - O`DONNELL: He does -- STEIN: Why is -- doesn`t he -- O`DONNELL: He does -- REID: Yes -- STEIN: Have other things to do? O`DONNELL: He`s -- REID: No -- O`DONNELL: No, he`s home in a pajamas eating ice cream, watching Megyn Kelly -- STEIN: That`s a lot of TV -- REID: Yes -- O`DONNELL: That`s -- and Joy, the -- this -- the "Fox" dynamic here is fascinating. Greta Van Susteren came out today telling him to cut it out. You know, he had just had a really soft interview on her show -- REID: Right -- O`DONNELL: Last night before he then went on to complain about "Fox News". REID: Yes, I mean, it is bizarre. In a lot of ways, Donald Trump seems like the commenter on every YouTube video that is running for president because he has a lot of money. And he is obsessed. And you know, I hate to agree with Bill O`Reilly, but he does seem to be obsessed with anything he sees as an infraction or somebody is being mean to him or just not being nice enough to him. He reminds me of that "Star Trek" character who could turn people mute, remember if you weren`t nice enough to the little boy? He really, literally is almost threatening "Fox News" that they better give him positive, glowing media coverage or else he`s going to tweet nasty things at them, I guess. It doesn`t make any sense, but it does give you a window into his character. O`DONNELL: Well -- REID: His character -- O`DONNELL: Yes, I mean -- REID: Six years old. O`DONNELL: He`s a guy who desperately wants to be liked and or loved. And Eliana, when he doesn`t feel that, he is outraged. JOHNSON: You know, I actually think the most interesting line in that Club for Growth ad, and the one that you have to imagine really gets under his skin is that he`s just another politician. O`DONNELL: Yes -- JOHNSON: Because that undermines his entire campaign. And as Sam pointed out, he`s now throwing his money around to combat the ad. And that`s exactly what he`s accused other politicians of doing, and what he`s waging his campaign against. He`s acting very much like the sort of establishment candidates that he has been invading against on the campaign trail. O`DONNELL: His latest whack on Megyn Kelly came at 10:07 p.m. on Twitter. "I think Megyn Kelly should take another 11-day unscheduled vacation." (LAUGHTER) Sam Stein, no one predicted this that the frontrunner for the Republican nomination would be in a recurring Twitter war with "Fox News". STEIN: It is a little bit -- it`s very bizarre. You would not have predicted this one. But this whole election season has been quite bizarre. We`ve had two very prominent Republican governors be the first two people to drop out. And keep in mind, the Republican Party reveres its governors. You would never have predicted that heading into this election despite all the problems that Rick Perry had in the last go. So, you know, there`s no way to really qualify or quantify this. I will say, you know, Trump is defying gravity a lot and we`ll see if he can continue attacking the megaphone of the Republican Party and still do it. O`DONNELL: Well, we have seen his first turndown in the polls on that "Cnn" poll. STEIN: Yes -- O`DONNELL: Eliana Johnson, thank you very much for joining us tonight on this. Coming up in tonight`s rewrite, Ted Cruz matches with Stephen Colbert. How do you think that turned out? And Republican Senator Kelly Ayotte says she`s tired of the political games that her party is playing in the Senate. And we have video of President Obama`s visit to a prison -- something no president before him ever chose to do. (COMMERCIAL BREAK) O`DONNELL: Republican Senator Kelly Ayotte sees another disaster coming for Republicans in the Senate if they try to shut down the government over funding for Planned Parenthood. (BEGIN VIDEO CLIP) SEN. KELLY AYOTTE (R), NEW HAMPSHIRE: I`m tired of the people on my side of the aisle who are pushing this strategy even though they know they don`t have the votes to have it passed in the United States Senate. And they certainly don`t have the votes to override a presidential veto. We saw the movie in 2013 and I don`t think we should relive that movie. Let`s remember what happened. When you shut the government down and you reopen it, it actually costs you more money. So, if you care about the fiscal state of the country, let`s not waste money. Shutting the government down with no results. (END VIDEO CLIP) O`DONNELL: Congress has until Thursday of next week to avoid a government shutdown. And there is no plan in sight. Up next, what happens when the price of a pill goes from $13 per pill to $750 per pill. (COMMERCIAL BREAK) (BEGIN VIDEO CLIP) HILLARY CLINTON (D), PRESIDENTIAL CANDIDATE: A drug that has been around for decades, it wasn`t just invented with new research and new dollars backing that up. It`s been around for decades that went from costing $13.50 a pill to $750 a pill, literally overnight. That`s price gouging, pure and simple! (END VIDEO CLIP) O`DONNELL: The person who raised the price of that pill to $750 for a life-saving drug used to treat parasite infections is the 32-year-old CEO of Turing Pharmaceuticals who yesterday said he would not lower the price in the face of protest. (BEGIN VIDEO CLIP) MARTIN SHKRELI, CO-FOUNDER, MSMB CAPITAL MANAGEMENT OF RETROPHIN, INC & FOUNDER, TURING PHARMACEUTICALS: At this price, Daraprim is still actually on the low end of what often drugs cost. And we`re certainly not the first company to raise drug prices. UNIDENTIFIED FEMALE: In response to all of this attention and doctors and patient groups saying they can`t access this drug, are you going to change the price? SHKRELI: No. (END VIDEO CLIP) O`DONNELL: After spending 24 hours as the poster boy of outrageous pharmaceutical prices, Martin Shkreli announced this evening that he would lower the price. (BEGIN VIDEO CLIP) SHKRELI: We have agreed to lower the price of Daraprim to a point that is more affordable and is able to allow the company and make a profit, but a very small profit, and we think these changes will be welcomed. (END VIDEO CLIP) O`DONNELL: We don`t yet know what that new price will be tonight, Senator Bernie Sanders said this. (BEGIN VIDEO CLIP) SEN. BERNIE SANDERS (I-VT), DEMOCRATIC PRESIDENTIAL CANDIDATE: Obviously, what these guys do is so outrageous that when it gets into the public eye and people perceive these huge increases in medicine that people desperately need, these guys have got to back down. (END VIDEO CLIP) O`DONNELL: Joining us now, "Vox`s" Ezra Klein. Ezra, this story illustrates a big hole in the last round of healthcare reform which is no real controls on pharmaceutical prices. EZRA KLEIN, VOX.COM: Yes, almost none at all. I think people really don`t realize how unique America is in how we treat pharmaceuticals. We are the only developed nation, the only one anywhere that allows drug companies to set their own prices this way. Other countries like Canada or England or Japan believe that because these drugs are life-saving, because the patient doesn`t really have the ability to say no often, it say yes or literally die. There needs to be some level of government regulation. The government needs to be the sort of prime negotiator. And so, you have other countries where these drugs are on offer. You can get them there and they are much cheaper. To use a different example, Celebrex which is a painkiller, you can get in America, on average in America, it costs around $250 for a round of it. In Canada, exact same drug made by the same people, it costs $50. It`s this huge disparity and we are the only country who pays it. O`DONNELL: Let`s take a look at the polling on this, 76 percent say they want to make sure -- in polling, 76 percent say they want to make sure the high cost of drugs are affordable. Also in polling, a 60 percent, total of 60 percent saying that government action to lower prescription drug costs, they support that. Sixty eight percent of Democrats do, 51 percent of Republicans support government action to lower prescription drug costs. Sam Stein, I don`t think we`re going to hear anything from a Republican candidate about lowering prescription drug costs. KLEIN: No -- STEIN: Well, you`re right -- KLEIN: Just something about it -- sorry. STEIN: No, it`s all right, Ezra. I don`t think you`ll hear anything about it in part because they`re very comfortable letting the free market work its way out. But keep in mind in some respects, it`s the Obama administration who is to blame for a little bit of this. The big deal that they cut -- in large part to pass healthcare reform back in 2009-2010 was with the pharmaceutical lobby. And what they did was in exchange for promising not to let Medicare negotiate its own prescription drug prices, they said pharma would support healthcare reform. And so now we`re living with that consequence. Now, you can argue that it was a necessary deal to be held, otherwise we wouldn`t have had healthcare reform in the first place. But we are living with those consequences, and so now you see the Democratic primary field, Hillary Clinton, Bernie Sanders and Martin O`Malley, say OK, we want to keep Obamacare in place but we need to build off in fundamental ways. And the most fundamental way of it all is to find ways to keep prescription drug costs relatively modest. O`DONNELL: And Joy Reid, Hillary Clinton`s proposal -- well, let`s listen to her say about a $250 a month cap that she wants to put. Let`s listen to this. (BEGIN VIDEO CLIP) CLINTON: Also under my plan, I will cap out of pocket drug costs for working families. You won`t have to pay more than $250 a month for covered medications. (END VIDEO CLIP) O`DONNELL: But that won`t actually control the prices. That will simply be built into your health insurance -- REID: Yes -- O`DONNELL: And -- REID: Yes -- O`DONNELL: That provision conceivably could end up raising premiums. REID: It could raise premiums because you`re talking about subsidizing the cost rather than as Sam said using the power of the federal government to regulate drug prices essentially by making the federal government the biggest buyer -- the sort of over buyer that can force the prices down. And I think that it is true that the two times that we`ve had major healthcare overhauls -- remember, when George W. Bush passed their prescription drug plan, they had this huge doughnut hole in it that caused your prices to spike when you reached a certain threshold. And then you didn`t get catch back up with the system and get your subsidies again until like $5,001. So, this is always been a really difficult problem and it is because big pharma is so powerful that kudos to the new way of passing healthcare reform. But I can tell you that Republicans who didn`t -- who fought healthcare reform tooth and nail fought it in part on the basis that ultimately if it remained in place, it would be expanded and that things like this would come back. And I think that if Hillary Clinton can wrap her arms around and sort of popularize a fix to the Affordable Care Act that actually gets at the problem unlike what she`s saying now. I think that, she and Bernie Sanders might actually have something there that Republicans, independent and Democratic voters would before. O`DONNELL: Ezra Klein, it seems this story of raising the price of one pill to $750 is the perfect political launching pad for the candidate who wants to come out with a really effective plan on controlling drug prices. What do you think the best approach to controlling affordability of pharmaceuticals is? KLEIN: So, there are two things here that are a little bit different, I think are worth keeping in mind simultaneously. Because one is a question of how much does the government pay for a pill that is already out there. And that`s where you have Hillary, you have Bernie Sanders arguing that Medicare should be able to use its tremendous size and market power to negotiate lower prices. Medicare should in effect become a huge buyer and use its market weight to bring down drug costs. But any of this other issue which is in some ways, I think actually more important about how do the drugs get developed? Because a really important piece of this, right, is we do want new drugs being developed and we do want there to be a real incentives to do it. And once they`re developed, how are profits made off of them. And here`s somewhere where Bernie Sanders for years now, long before his presidential campaign has had really one of the most innovative ideas I think in American politics. Where he`s been arguing to create alongside the current patent system where a drug company creates a drug, gets an exclusive monopoly over it. He wants to create a price system where the government would have prices for drugs created on certain diseases and they would not be under patent when they came out, so they`d be much more affordable. O`DONNELL: Ezra Klein gets the last word on it tonight. Thanks for joining us tonight, Ezra. Coming up -- KLEIN: Thank you -- O`DONNELL: President Obama`s visit to a prison. In that visit, you will see the first video of it tonight, President Obama is able to connect with the prisoners who he`s talking to in a way that no president before him ever could. (COMMERCIAL BREAK) (BEGIN VIDEO CLIP) BARACK OBAMA, PRESIDENT OF THE UNITED STATES: How you all doing? (CROSSTALK) UNIDENTIFIED MALE: How`re you doing, sir? OBAMA: What`s going on? What`s your name, man? UNIDENTIFIED MALE: (INAUDIBLE) -- OBAMA: Good to see you. UNIDENTIFIED MALE: Good to see you -- OBAMA: Nice to meet you, good to see you sir -- TIMOTHY JORDAN, PRISONER: Timothy Jordan. OBAMA: Timothy, it`s a pleasure to see you -- UNIDENTIFIED MALE: Tyrone Red(ph) -- OBAMA: Tyrone(ph), good to see you, man. UNIDENTIFIED MALE: Thank you, sir -- UNIDENTIFIED MALE: O`Neil Stewart(ph). OBAMA: O`Neil, so nice to see you -- UNIDENTIFIED MALE: Jesus Chavez -- OBAMA: Jesus, good to see you -- UNIDENTIFIED MALE: David Mashaw(ph). OBAMA: David, very nice to meet you. Everybody have a seat. Well, gentlemen, thank you for taking the time to meet with me. I know this is the first time this has ever happened. (END VIDEO CLIP) O`DONNELL: Thanks to Vice on HBO, we have a full video record of the first visit to a prison by a president of the United States. 43 presidents before President Barack Obama have ignored our prison population and paid no political price for that. We now have the highest prison population per capita of any country in the world and we have a president who would like to see that change. (BEGIN VIDEO CLIP) OBAMA: I did not know my dad and too many of our young people do not know their dads. And, I would say for them to be able to see you in a strong, positive way, you know, that is going to have an impact. I met my dad for one month when I was 10 years old. That is the only time I met him my whole life. He and I had only one month ended up having an impact on me. So, kids, you know, are paying attention even when they act like they are not. UNIDENTIFIED MALE INMATE: I have a teenage boy that is out there. I have a 15-year-old, 17-year-old, and I got a 10-year-old and an 8-year-old that is coming up. My main thing is that they need to be busy. You know, because when I was growing up I did not have nothing to do at all. (END VIDEO CLIP) O`DONNELL: The president wants to break the cycle of imitation and expectation that can lead some kids down a road that ends in prison. (BEGIN VIDEO CLIP) OBAMA: You cannot raise kids in an environment where this is all they know and they are surrounded by it. And, then think that somehow they are going to be immune from the influences that they are seeing every day. UNIDENTIFIED MALE INMATE: Right. OBAMA: Part of the concern that I have had is that, as a society we seem to be OK with certain communities just being locked in this cycle, where kids are being raised around drug crime. They naturally gravitate towards drug crime. They then get involved in the criminal justice system, and it just churns and everybody thinks that is normal. That is what you were saying about your brother. "My big bro, he is going to prison." Then he starts thinking I will probably end up at some point going to prison and I will be OK. Your dad was in prison? UNIDENTIFIED MALE INMATE: He died in prison. OBAMA: He died in prison. Now, your kids start looking that you are in prison. And, then they start thinking that is normal. And, we cannot have our kids thinking that way. And, part of it is everybody here has got to take responsibility to try to break that cycle. UNIDENTIFIED MALE INMATES: That is right. (END VIDEO CLIP) O`DONNELL: You can watch that Vice Special Report, "Fixing The System" this Sunday at 9:00 P.M. on HBO. Joining us now, Bruce Western, a professor of criminal justice and the director of the Malcolm Weiner Center for Social Policy at the Harvard Kennedy School of Government. Professor Western, the president was talking about environmental factors, neighborhood factors, the old fashioned idea and real idea about kids falling under some bad influences. What are the larger dynamics out there that government has created that have led to this dramatic increase in our prison population? BRUCE WESTERN, PROFESSOR AT THE HARVARD KENNEDY SCHOOL OF GOVERNMENT: Yes. That is a pretty fundamental question, Lawrence. If we go back to the early 1970s, our prisons held about 100,000 people on any given day that were locked up. That was 0.1 of 1 percent of the population were locked up back in the 1970s. These days, if we look at the prison population, it is about 500 per 100,000. So, we are five times larger than we were 40 years ago or so. And,this has largely been driven by tougher sentencing policy, longer sentences. People are going to prison for -- particularly for drug crimes that they never used to do prison time for. And, for violent offenses, people are serving much longer than they used to. It is all driven by changes in criminal justice policy. O`DONNELL: Let us listen to the way the president put that in his visit to the prison. (BEGIN VIDEO CLIP) OBAMA: A primary driver of this mass incarceration phenomenon is our drug laws are mandatory minimum sentencing around drug laws. And, we have to consider whether this is the smartest way for us to both control crime and rehabilitate individuals. This is costing taxpayers across America $80 billion a year. (END VIDEO CLIP) O`DONNELL: We have also seen a privatization in the prison business, we can now call it, since it is no longer completely government run. Over these decades, when the populations have increased, are there profit incentives in this system now? Are there profiteers in this system that are in effect, lobbies for increased prison populations? WESTERN: Yes. I mean, you know, anytime you are spending -- the government is spending $80 billion, they are going to be private interests who are going to have a real interesting capturing a share of that money. But, there have been a lot of voices that have been driving up the prison population, turning policy in a much more punitive direction. And, so as well as the private vendors, perhaps even more important than the private vendors, groups historically on the conservative side of politics, ultimately by the 1990s, I think there was bipartisan consensus around tough on crime policy and special constituencies like law enforcement, prosecutors and so on. They were also very strong advocates for tough on crime policy. O`DONNELL: Excuse me. I know in California, it is well known in California politics that the most influential special interest group is the prison guards union in California that always seems to get its way. And, they have at various times taken positions on policy, on increasing sentences, on ballot measures that would increase sentences and so forth. WESTERN: Yes. Very much so. And, in California in particular, the correctional officers union were very, very strong political voice for very tough sentencing, and they had a direct stake in that. O`DONNELL: Professor Bruce Western, thank you very much for joining us tonight. I really appreciate it. Coming up in the "Rewrite" tonight, Ted Cruz attacks the Supreme Court on Stephen Colbert`s show. But, he forgot to mention that he used to work at the Supreme Court. A place that he thinks is now so illegitimate. (MUSIC PLAYING) (COMMERCIAL BREAK) O`DONNELL: That was the crowd celebrating outside the Pope`s residence in Washington today. The Pope begins his day in Washington tomorrow with a visit to the White House. Joining us now from outside the Pope`s residence tonight, Luke Russert, NBC News Capital Correspondent. Luke, with all the streets closed down in Washington tomorrow, how difficult is it going to be to get around for people? LUKE RUSSERT, NBC NEWS CAPITOL CORRESPONDENT: It certainly is going to be difficult, Lawrence. There has been advisories throughout the city to use public transportation if possible. Tomorrow, the Pope is going to be at three locations. He is going to be at the White House in the morning, and he is going to be at St. Matthews. That is, of course, the famous church where John F. Kennedy`s funeral took place. And, then he is going to be in the Basilica, which is right here -- it is the largest catholic church in the country near Catholic University. So, those are three very different sites in three different areas of the city, which will take a lot of manpower to move the Pope between all of them. Hence, you are going to see some real road closures that will affect how people get to and from work. Also, report tonight that there has been a severe power outage at one of the metro stations that is actually servicing the Basilica event. There is also a transformer blowout on a separate line. So Metro, which has long had a shabby track record in terms of working and being efficient seems to be not working at a very inopportune time. It remains to be seen whether they will get that up and running tomorrow. But, I got to tell you, Lawrence, this has been something as a life-long resident, it has been quite incredible to see. People were so panicked about the street closures. There is a run on the grocery store last night. I made the mistake of going last night and the lines, where what I would like to say, hurricane-esque, or snow blizzard-esque. It was really quite an event. O`DONNELL: Luke Russert, thank you very much for joining us tonight. I appreciate it. Up next in "The Rewrite" Ted Cruz tells Stephen Colbert that the Supreme Court is an illegitimate institution when he does not like their decisions. (MUSIC PLAYING) (COMMERCIAL BREAK) O`DONNELL: Tonight, Harvard law school graduate, former Supreme Court clerk and current presidential candidate Ted Cruz matched wits with the wittiest political analyst on T.V. (BEGIN VIDEO CLIP) TED CRUZ, (R) PRESIDENTIAL CANDIDATE: What I am fighting for are simple principles. Live within our means. Stop bankrupting our kids and grand kids, follow the constitution -- STEPHEN COLBERT, LATE NIGHT TALK SHOW HOST: And, no gay marriage. (AUDIENCE CHEERING AND APPLAUDING) CRUZ: And, no gay marriage -- Well, no, actually, let us be precise. Under the constitution -- COLBERT: Yes? CRUZ: Marriage is a question for the states. If you want to change -- COLBERT: It does not mention marriage in the constitution. (AUDIENCE APPLAUDING) CRUZ: We have had a country for 200 years. COLBERT: So, you may be right. You may be right, but it does not mention marriage in the constitution. You believe that marriage -- CRUZ: And, that is exactly why it is a question for the states. Because the 10th amendment says, if it does not mentioned it, it is a question for the states. That is in the bill of rights. Everything that is not mentioned is left to the states. So, if you want to change the marriage laws -- COLBERT: I am asking what you want. CRUZ: I believe in democracy. I believe in democracy and I do not think we should -- COLBERT: Guys, guys. However you feel, he is my guest, so please do not boo him. CRUZ: I do not think we should entrust governing our society to five unelected lawyers in Washington. Why would you possibly hand over the rights of 320 million Americans to five lawyers in Washington to say, "We are going to decide the rules that govern you." If you want to win an issue, go to the ballot box and win at the ballot box. That is the way the constitution was designed. (AUDIENCE APPLAUDING) O`DONNELL: So, former Supreme Court Clerk Ted Cruz now regards the Supreme Court as just five unelected lawyers in Washington who have somehow seized the power to govern. It is a mystery to him, how did that happen? Of course, the Supreme Court is really nine unelected lawyers and they are not really lawyers anymore. They are judges. They are judges whose jobs were created by the founding fathers in the constitution of the United States, which requires that the judges not be elected, that they be chosen by the President and confirmed by the senate, which makes Ted Cruz one of the 101 democratically elected officials who have a say in who gets on the Supreme Court. And, still he plays the ignoramus on T.V. about how the Supreme Court ever became the Supreme Court. (BEGIN VIDEO CLIP) CRUZ: Why would you possibly hand over the rights of 320 million Americans to five lawyers in Washington to say we are going to decide the rules that govern you. (END VIDEO CLIP) O`DONNELL: Ted Cruz knows that the constitution gives the Supreme Court the judicial power to decide constitutional disputes, which means yes, the Supreme Court has the power to decide what the law of the land really is. Now, it is OK to disagree with the Supreme Court. But if you claim it is an illegitimate institution, as he just did, then all of its decisions are illegitimate, including the decisions Ted Cruz helped write when he was a clerk for Chief Justice William Rehnquist. In the hobby lobby case last year, four Supreme Court Justices disagreed with the Supreme Court`s decision. But Ted Cruz said this about that decision. "Today, the Supreme Court handed our nation a landmark victory for religious liberty." Many Americans disagreed with the court`s decision on campaign finance in the Citizens United case, including four members of the court. But Ted Cruz applauded that decision by those five unelected lawyers. And, of course, many Americans disagreed with the court is decision in Bush V. Gore in 2000. Four members of the Supreme Court disagreed with that decision. But, Ted Cruz loved that decision. Ted Cruz was working for the Bush campaign in 2000 when the Supreme Court in effect decided who would be the next president of the United States. Not a peep out of Ted Cruz then about that decision being issued by five unelected lawyers, including Ted Cruz`s former boss, who then, of course, had the honor of swearing in the new president. (BEGIN VIDEO CLIP) UNIDENTIFIED MALE SPEAKER: I, George Walker Bush, do solemnly swear. GEORGE W. BUSH, FMR. U.S. PRESIDENT: I, George Walker Bush, do solemn my swear. UNIDENTIFIED MALE SPEAKER: That I will faithfully execute the office of the President of the United States. BUSH: That I will faithfully execute the office of the President of the United States. (END VIDEO CLIP) (COMMERCIAL BREAK) O`DONNELL: Hillary Clinton has taken a position on the Keystone Pipeline and there is more news tonight from the FBI about her e-mails while she was secretary of state. That is next. (COMMERCIAL BREAK) (BEGIN VIDEO CLIP) HILLARY CLINTON, (D) PRESIDENTIAL CANDIDATE: I think it is imperative that we look at the keystone pipeline as what I believe it is, a distraction from the important work we have to do to combat climate change. And, unfortunately, from my perspective, one that interferes with our ability to move forward to deal with all the other issues. Therefore, I oppose it. (END VIDEO CLIP) O`DONNELL: Joy Reid, Bernie Sanders issued, I guess, a tweet tonight welcoming Hillary Clinton to his long-held position on the Keystone Pipeline. REID: Yes. Well, this is a candidate who understands the playing field that she is on. Right? There was an Elizabeth Warren effect for a long time that pulled Hillary Clinton to the left. And, now, you have Bernie Sanders who is pushing Hillary Clinton to the left. I mean she took a long time to come to this position, but this is the only place that she could be in the current composition of the Democratic Party. O`DONNELL: Sam Stein, she sure took a messy route to what just sounded like an extremely clear position. Her thinking on is very clear, "I should just express it." But in January, she said, "You will not get me to talk about Keystone because I have steadily made clear that I am not going to express an opinion." In July, she said, "If it is undecided when I become president, I will answer your question." Last week she said -- last week, "I have been waiting for the administration to make a decision. I thought I owed them that. I cannot wait too much longer." Putting the White House on notice. And, so, that what she said last week came true today and finally took that position. STEIN: Yes, I do not think this is the most coherent way to come about making policy, but as Joy said, it was probably the inevitable way that she would get there. You know, she had a very interesting role in this whole process and that this went through the state department because this pipeline crossed an international border. And, she was there when this whole thing was initiated. So, she had ownership of this in some respects. And, I do understand why she was hesitant to come out and say something, but you know, it was a very circuitous route. And, it does seem -- the timing does seem a bit curious. I know, I can report that they were telling labor union officials as of a couple of weeks ago that this was coming because they know the labor unions are supportive of this project. And, there does seem to be timed to a general push within the Democratic Party to bring this back to the forefront. Some democrats did not choose the bill today, carbon reduction energy bill today. We have Pope Francis in D.C., who will likely reference climate change in his speech. So, perhaps that was what prompted her to jump onboard what was a very odd, seemingly incoherent way to get about a position on keystones. O`DONNELL: And, this illustrates nicely just how awkward it could turn out to be for Joe Biden to run for president. Because what is his position on keystone? REID: Right. Yes. O`DONNELL: You know, I mean his administration has not decided what the position is on keystone. But, he cannot -- How does he get out in front of the president on it? REID: Right. And, the only viable position for Joe Biden if he gets in is to the left of Hillary Clinton on basically everything. So, she is sort of, I think that might be another part of her thinking is that she is trying to close all doors. If they would -- them love to clear the field of Joe Biden to lock out and possibly even getting in. He cannot get to her left on this now. O`DONNELL: We have a report in Bloomberg today about Secretary Clinton`s e-mails when she was secretary of state. The reports saying that the FBI has recovered personal and work-related e-mails from the private computer server used by Hillary Clinton during her time as secretary of state, according to a person familiar with the investigation. And so, Sam Stein, the drip-drip continues on the e-mails. It turns out that the server does have recoverable material on it. STEIN: Yes, I mean, beyond -- I think there is a -- this story is not going away. That there will be developments however incremental or large they may be in the months ahead. As this FBI investigation goes on, it could go on for a couple of months, we should expect to see more stories like this. On the flip side, I am not sure on the substantive matters how much this changes things. As much as I would love to see these personal e-mails as a report, I think on legal grounds, there is no apparent obligation for Hillary Clinton to make the determination that she has to turn over personal e-mails. Now, someone might come in and say, you know, this is at public interest, it should not have been -- you made an overly sensitive determination that it was private. But, I do not think that changes that dynamic. I think it does go to show you, as you reference that this is a drip, drip, drip type of story. O`DONNELL: Well, Joy, just to clarify. The report indicates that the FBI also found work related e-mails in addition to the first one -- STEIN: That changes things. REID: Right. I mean the other complicating factor in addition to what Sam said is that the department of justice has already made a finding that Hillary Clinton was well within her legal rights to delete whatever e-mails she wanted, whether she deemed them to be private or otherwise. So, I think, because there is no other underlying story -- O`DONNELL: Or, she is only within her legal rights to delete personal e- mails. REID: Yes. STEIN: Correct. O`DONNELL: She is not within her legal writes to delete any work-related e-mails. REID: But she was also, according to the DOJ finding able to determine on her own what e-mails were personal and what were not. O`DONNELL: Yes, exactly. REID: So, I think it is an area where until you find that she did something that is demonstrably is specifically wrong, like she emails a then classified at the time document from her personal email, then I think there are some things. Unfortunately, now, it just feels that with the swirling sort of process story that is of more interest to the media and people who already dislike Hillary Clinton than there is an underlying scandal here. Just in my opinion. O`DONNELL: And, Sam, that is one of the challenges of the this -- for Hillary Clinton, is defending against that is extremely difficult because of basically of the complexity of description of what is involved here. STEIN: Yes. I totally agree with that. It is very arcane. It is tough to follow. I have difficulties following it sometimes, and I am the smartest person ever. (LAUGHING) O`DONNELL: Yes. Exactly. STEIN: But, also, you know, there is an element of self-inflicted wound here, too, right? She made some decisions that have come back to look relatively wrongheaded, I want to say in retrospect. And, she even admits it. And, so, she has kind of created her own bad narrative. O`DONNELL: Joy Reid, thanks for joining us. And, once again, Sam Stein, self-described, smartest person ever gets tonight`s last word. STEIN: It just meant to be. (LAUGHING) O`DONNELL: Yes. It is meant to be. Thank you very much. Chris Hayes is up next. END