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The Last Word with Lawrence O'Donnell, Transcript 1/28/2016

Guests: Chuck Todd, Steve Schmidt, Tom Davis, Jonathan Allen, Michael Barr, Robert Hockett, Trip Garbiel, Jon Soltz

Show: THE LAST WORD WITH LAWRENCE O`DONNELL Date: January 28, 2016 Guest: Chuck Todd, Steve Schmidt, Tom Davis, Jonathan Allen, Michael Barr, Robert Hockett, Trip Garbiel, Jon Soltz

RACHEL MADDOW, MSNBC HOST: Conspiracy when you`ve lived through what they have -- told everything is fine when it was not.

In some cases being told that by people who knew it was not fine. It is easy to see why they are so suspicious.

It doesn`t count as paranoia, it doesn`t count as conspiracy when you`ve lived through what they have lived through.

That does it for us tonight, we will see you again tomorrow, now it`s time for THE LAST WORD with Lawrence O`Donnell, good evening Lawrence.

LAWRENCE O`DONNELL, MSNBC HOST: Rachel, that was an award-worthy hour of television you did last night from Flint.

Absolutely gripping, every minute of it.

MADDOW: You`re very kind, thank you for saying so --

O`DONNELL: Rachel, did you see any of this Trump event, the counter event to the debate? Because --

MADDOW: Way too much.

O`DONNELL: OK, because I --

MADDOW: Yes --

O`DONNELL: Was watching the debate, would you mind running over here and filling me in on whatever you saw of the crazy Trump event.


MADDOW: I`ll reenact it for you, O`Donnell --

O`DONNELL: I got a chair for you --

MADDOW: All right, I`ll be there in just --


MADDOW: A second --

O`DONNELL: Great, all right. Well, tonight, there were two events filled with empty political rhetoric, but only one of them had Donald Trump.


CHUCK TODD, MODERATOR, MEET THE PRESS: As you might have heard, it`s the debate that`s missing the party`s frontrunner.

UNIDENTIFIED FEMALE: Part of a long-standing fight with Fox News and moderator Megyn Kelly.

SEN. TED CRUZ (R), TEXAS: She might ask a mean question and who knows what could happen. I mean, his hair could stand on end.

UNIDENTIFIED MALE: And that`s a sight no one wants to see.



DONALD TRUMP, CHAIRMAN & PRESIDENT, TRUMP ORGANIZATIONS & FOUNDER, TRUMP ENTERTAINMENT RESORTS: When you`re treated badly, you have to stick up for your rights.

UNIDENTIFIED MALE: He`s holding his own competing event.

UNIDENTIFIED MALE: It`s not a competition.

UNIDENTIFIED MALE: His own protest event tonight at Drake University --

UNIDENTIFIED MALE: It`s just like the Academy Awards --

UNIDENTIFIED MALE: You have Donald Trump in one place and everybody else potentially overshadowed by whatever he does, but fighting among themselves to emerge.

UNIDENTIFIED MALE: There certainly is a lot of intrigue and a lot of drama.

SEN. MARCO RUBIO (R), FLORIDA: Who`s going to show up, who`s not going to show up, who`s challenged due to what? --

JIMMY KIMMEL, COMEDIAN & TELEVISION HOST: I have to believe Jeb Bush is excited about it.

It`s like when the bully stays home sick from school, you get one day of not getting beat up.



O`DONNELL: Donald Trump knows two things. He is ahead in the polls and he is a terrible debater.

He knew there was nothing he could possibly gain on the debate stage tonight if he faced solid questions by the moderators and attacks by Ted Cruz and the other candidates.

And so Donald Trump made the strategic choice that a terrible debater with a lead in the polls should make -- refuse to debate.

If Donald Trump becomes the Republican nominee, you can expect him to refuse to debate Hillary Clinton or Bernie Sanders.

Donald Trump has repeatedly demonstrated himself to be an utter ignoramus in all matters involving governing.

He has appeared on debate stages with people who agree with him on most of the issues. His only memorable moment as a debater was defending so called New York values on 9/11.

That was an easy moment that was handed to him by the guy who is supposed to be the best debater among the Republicans.

It was an idiotic, hateful thing said by Ted Cruz who proved himself to be a terrible debater too.

In a one-on-one debate with the Democratic nominee, Donald Trump would never be handed an idiotic, hateful statement about New York.

Donald Trump would be challenged on every one of his vague policy ideas by another candidate who is opposed to every one of those ideas.

Donald Trump could not survive ten minutes of that. And the last two and a half-hour debate, Donald Trump only had to speak for 17 minutes.

In a one-on-one general election debate, the candidates have to speak for at least 40 minutes and they faced real challenges about policy from the moderators and the opposing candidate.

If you watch Megyn Kelly on a regular basis, you know that she leans Republican on every issue of the day.

She is very clearly anti-Obama on virtually every issue of the day. Donald Trump is right to say that she`s not objective, but she`s not objective in a way that favors Donald Trump.

There is no way that Donald Trump will accept the objectivity of general election debate moderators from news organizations that don`t lean Republican.

He will complain that the moderators are biased against him and he will refuse to debate in the general election if he is the nominee.

Because he knows that he could not survive a general election debate against a candidate who is a policy expert and opposes all of his policies.

The Trump campaign set the precedent tonight for refusing to debate. A precedent that Donald Trump will surely follow if he is the Republican nominee.

We may have already seen Donald Trump`s final presidential debate. At his rally tonight in Iowa, Donald Trump got one of his biggest reactions when he said this.


TRUMP: When you`re treated badly --


TRUMP: You have to stick up for your rights. And I have to go a little step further and say that "Fox" has been extremely nice in the last number of hours actually.


And they`ve wanted me there, and they said how about now? They called a few minutes ago, how about now?

Can you come over? I said hasn`t it already started? And we actually thought what we`d do is we`d let them start, and you know, we wanted to be about 15 minutes into that hour so that by now they`re all tuned in.

Look at all the cameras like the Academy Awards, it`s just like the Academy Awards.


This is the Academy Awards.


O`DONNELL: You made it. Rachel Maddow got across the hall, thank you very much.

MADDOW: I put myself on a hand-truck to wheel myself down here.

O`DONNELL: Thank you very much for joining us. As we also have Steve Schmidt; Republican strategist and an Msnbc political analyst.

And Chuck Todd; political director for Nbc News and the moderator of Nbc`s "MEET THE PRESS" is here.

Rachel, I floated this idea last night when you were in Flint, that this is the first debate that Donald Trump will refuse to participate in.

And this is setting the precedence, so he can refuse to debate one-on-one against a candidate who actually opposes his views.

I mean, you know, to say he`s a good debater is based on these unbelievably small-minded, sloganeering, nothing debates --

MADDOW: Yes --

O`DONNELL: That he`s been in. There`s no debating skills he`s exhibited - - compare what he would bring to a one-on-one debate to what Bernie Sanders or Hillary Clinton would bring, and he will stay home.

MADDOW: Well, there`s -- it`s interesting because he`s been such a prohibitive frontrunner and his lead has been so solid.

But that`s just upside for him. The downside for that -- of that for him is that he`s never gotten like a bump out of the debate.

You know what I mean? He`s never had a sustained upward trajectory adjustment because of doing well in a debate.

He`s doing well because of other things. He`s sort of doing well despite the debates.

And there`s a lot of precedent in vaguely modern American history of people not wanting to debate for the presidency.

You know, LBJ didn`t want to debate.

O`DONNELL: Right --

MADDOW: Goldwater -- wasn`t until --

O`DONNELL: We went years without debates --


MADDOW: Particularly had debates --


MADDOW: And a lot of it, you know, candidates (INAUDIBLE), it didn`t kill him to not debate.

But it`s now an expectation that he`ll at least try, and maybe he is trying to undo that expectation.

O`DONNELL: He`s doing a good job of it. Chuck Todd, have you been watching the debate or the Trump event or both? And you can review either one for us.

TODD: Well, I am two-thirds, one-third split screen out on a computer, I`ve been watching that --


O`DONNELL: I knew you could do it Chuck --

TODD: My favorite --

O`DONNELL: I knew you could do it --

TODD: My favorite part was Rick Santorum trying desperately not to look like he was behind the podium directly.

Like, no, I don`t want the Trump name in front of me.


Right? You know, it was sort of like fun. But I`ll get up on stage -- look, I also went there before and it is interesting and it had a rock concert atmosphere, all right?

There are -- there is this -- and I`ve been to a lot of Trump events now and there`s always this same feeling, but particularly when it`s on a college campus here.

People that want to just see the show, some don`t like Trump, some love Trump.

But it is sort of like this rock concert-feel that has dedicated group like I think Fish concert or dead head, so things like that, and we get Trump ahead(ph).

But what was amazing was just how much energy and excitement was at Drake, right on the outside everybody is freezing.

And then you came here to the debate and it was just so proper. I don`t know how to put it.

I mean --


TODD: It was fine --


TODD: But there was just -- you know, to borrow a phrase, it was low energy.

MADDOW: One of the things that I saw happen there at Drake, which I thought was interesting, Chuck, was that, Drake had to put out a statement telling people basically, you`re going to be disappointed if you turn out for this event.

Apparently, the venue he`s in seats about 700 people, and the Trump campaign between now, I know -- is there wonks? They have --

O`DONNELL: Sure --

MADDOW: They drastically oversold it, so that they knew they`d get a big line of people outside and then not everybody would get in.

O`DONNELL: Let me have a little private moment --

TODD: Well, they did put a -- yes, they put a big -- they had a big video screen outside for people, but frankly --

O`DONNELL: Well --

TODD: I mean, you know, I consider myself hardy, I know Iowans are hardy. I thought it was too cold to stand out there and watch their --

O`DONNELL: I just want to have a private, technical word with Rachel for a minute. Don`t listen to this.

My sound is going in and out every once in a while, so --

MADDOW: I got that --




To you --

MADDOW: Yes --

O`DONNELL: You just start talking, OK? --


O`DONNELL: But Steve Schmidt --


Steve, the debate without Donald Trump, which is what I spent the last hour with, is a decidedly boring event, I guess to no one`s surprise.


MADDOW: Steve, the debate without Donald Trump, obviously "Fox" is freaked out because it`s not going to rate compared to a debate that would have Donald Trump in it.

As a Republican who cares about policy substance and who is sort of lamented the Trumpism within the party this year.

Is the Republican debate without Trump showing a better side of the Republican Party? Is it there are people comporting themselves in a way that you`re happier with as a Republican?

SCHMIDT: Look, I think when you look at the debate, you know, Donald Trump sort of pulled off a remarkable political feat here.

He raised $6 million for veterans. He had two of his competitors, the last two winners of the Iowa caucuses show up at his event.

And he turned the entire "Fox" Republican debate into an undercard event. It doesn`t have a particular amount of relevance without his presence there.

In fact, he set up a scenario where the establishment candidates going after Ted Cruz -- we think Cruz`s position in Iowa and of course the establishment candidates are in a competition for who comes in third in Iowa and who is going to emerge out of New Hampshire.

And I would just say, you know, to Lawrence, at the beginning of this, I mean, the notion that Donald Trump won`t acquit himself well should he be the nominee in a Fall debate against Hillary Clinton or Bernie Sanders.

You know, I just profoundly disagree with it. First, I don`t think either one of them are particularly charismatic or effective debaters.

And secondly, I think that Donald Trump has shown throughout the entirety of the campaign a phenomenal talent to be able to communicate.

And he`s won all of these Republican debates from the first one to the last one. He has in fact strengthened his polling numbers coming out of all of them.

And so, as we come in now to the final weekend before Iowa, Donald Trump is in complete command of this race as he has been literally from the second he got into it.

And it`s amazing to watch it at a political level.

O`DONNELL: Steve, can you name me one policy challenge he actually faced and handled in any one of the debates?

SCHMIDT: You know, Lawrence, I think that he`s gotten a range of questions on policy issues.

But I think that he`s effectively communicated a departure from Republican orthodoxy on a couple of key issues that have really broken through.

The first is on trade. It`s not a reflection of free trade or -- and I think that connects with a blue collar base in the Republican Party, non- college educated, deeply impacted by the great recession, ravaged by globalization.

And there`s a lot of Democrats that fall into that category as well, that I think he has the potential in a general election to connect with.

O`DONNELL: So, in a --

SCHMIDT: The second issue --

O`DONNELL: In a general election debate with Bernie Sanders, you would hear Bernie make the case on a factual basis point by point against TPP and then Donald Trump would say I agree with Bernie?

SCHMIDT: Well, look, I think at the end of the day that may not be an ineffective way to campaign or communicate in a debate.

You know, this is a game of emotion. You`ve seen that play out on both parties sides over the course of the campaign.

You know, Bernie Sanders campaign is fueled by passion, by conviction, by an authenticity.

There`s a connective tissue between Sanders and Trump, in that they`re the two candidates talking about the corrupting influence of money and politics.

You know, Donald Trump departing from orthodoxy, for example with the carried interest loophole.

You know, should he run against Hillary Clinton? It would be very interesting in the debate when that discussion turns to national security policy.

Hillary Clinton`s support of the Iraq war, Donald Trump was always opposed to it.

So, I think he has conveyed two elements of the Republican Party who are fed up, sick and tired of a failed Republican establishment that he`s different.

And I think you can judge the debate at a college debating level, scoring points for fluidity with, you know, with policy details or you know, the big points that are made.

The big thematic points. So, I think he`s been very effective at that in these debates.

O`DONNELL: Rachel, will incoherence work in general election debates?

MADDOW: That`s interesting, because I mean, there is a certain word solid --


MADDOW: Phenomenon to the way that he speaks at his stump speeches and also the way that he answers things in debates.

I actually think that he is more directive that his sentences tend to be more shorter and more direct in the debates than he does when he`s doing one of these long stump-lining speeches like he did tonight.

Honestly, I think the insight that you had that he will refuse presidential debates, I think that`s a 50/50 shot. I think --


MADDOW: That`s absolutely within the realm of possibility. It`s going to be so weird for the Republican Party when he gets the nomination that I think that the idea that the previous Republican Party norms are going to predict what happens next.

It`s going to be pretty much dead at that point, and if he decides he doesn`t want to debate, he`s just not going to debate.

I think that it will be interesting to see what his ratings are tonight collectively on the various networks that showed him at Drake University tonight, compared to the -- compared to the six candidates debate that they did without him.

I`m not sure "Fox" -- I understand why "Fox" was desperate to get him. It would be really interesting to see how many people watch without him.

O`DONNELL: Rachel Maddow and Steve Schmidt, thank you both --

MADDOW: Thank you --

O`DONNELL: For joining us tonight, I really appreciate it, thank you Rachel, very much.

Coming up, another Democratic debate coming up right here. Hillary Clinton against Bernie Sanders without of course Hillary or Bernie.

We will have supporters of both campaigns.



TRUMP: I don`t like her. She doesn`t treat me fairly. I`m not a big fan of her at all. I don`t care, I mean, she was -- she probably was -- might be the best thing that ever happened to her.


UNIDENTIFIED MALE: That`s Donald Trump criticizing someone and then throwing in a compliment for himself, also known as a trumple(ph) brag.






TRUMP: That was amazing. Isn`t that better than this debate that`s going on? Whoever is sleeping, right?

They`re all sleeping. They`re all sleeping, everybody.


O`DONNELL: Well, I was able to watch the first hour of the Republican debate. Let`s see what our guests thought of it.

We have Chuck Todd with us tonight continuing over, we also have Jonathan Allen, columnist for "Roll Call", co-author of "HRC: State Secrets and the Rebirth of Hillary Clinton".

And joining us now, also Tom Davis; former Republican Congressman, he`s joining us from Manchester, New Hampshire.

Tom Davis, to you, what did you make of that first hour debate?

TOM DAVIS, FORMER REPUBLICAN CONGRESSMAN: Well, it was ginger ale without the (INAUDIBLE), basically --

O`DONNELL: It sure was.


DAVIS: So, I mean, you know, the candidates went out a little bit. It was pretty structured. I don`t know how long it held the audience outside of the junkies like myself.

O`DONNELL: Jonathan Allen, there`s more to go, but one thing I was surprised at, at least the first hour is, there was no big Marco Rubio versus Ted Cruz flare up.

We saw a bigger flare up with them in the last debate when Donald Trump was standing idly by during their fight.

But no ignition in the first hour anyway.

JONATHAN ALLEN, COLUMNIST, ROLL CALL: I think in part, the other candidates don`t want to give Donald Trump what he`s hoping for.

Which is that they all beat up Ted Cruz either on his behalf or he`s not there. So, you haven`t seen fireworks.

I didn`t see a whole lot of new ground Trump. We`ve seen a bunch of Republican debates, and I think this is the seventh one so far.

And they`re basically all saying the same things they were before without Donald Trump in the midst of it to keep everyone`s attention.

O`DONNELL: The "Fox News" tried desperately all day to get Donald Trump into the mix.

They released a statement tonight admitting as much, saying Roger Ailes had three brief conversations with Donald Trump today about possibly appearing at the debate.

He said then, in the course of those conversations, we acknowledged his concerns about a satirical observation we made in order to quell the attacks on Megyn Kelly.

And Chuck Todd, Donald Trump has said it was more than acknowledged, they apologized.

He`s -- he didn`t name names, but I think we can assume Roger Ailes since they`re admitting that Roger Ailes called him, calling up and apologizing, trying anything they could to get him into that debate tonight.

And now we see of course why they desperately needed him.

TODD: Well, there`s no doubt. It does feel -- it just feels dry. I mean, I thought -- but I can`t top the metaphor that my friend Tom Davis just used (INAUDIBLE).

But let me disagree a little bit on whether there was engagement here. There is a cold war between Cruz and Rubio.

You feel it throughout the whole debate. There was -- there are these subtle shots that they take at each other, particularly Rubio.

You know, one person goes -- I really -- you know, there`s a question in there having to do with the issue of the phone records and which side Cruz voted on.

Rubio has been attacking him on that, about the idea of who should collect the metadata.

And Rubio goes out of his way. You know, I really respect Rand Paul for his positions on this.

But let me tell you why there was that -- there was actually the most fascinating part actually took place while we were at the start of the show.

And I was doing my two-thirds listen there and "Fox" did an amazing thing, they played a long clip, a montage of Ted Cruz during the immigration debate.

And about whether, was it a poison pill? Wasn`t a poison pill. What made it fascinating was, you didn`t see big montages having to make other candidates clarify things.

Cruz feels as if he is on the defensive tonight, sometimes from the moderators and sometimes from those on stage.

O`DONNELL: And Chuck, Cruz is the one who more than anybody else -- has more than anybody else at stake on that Iowa stage.

This is the state he`s got to win.

TODD: He does, and he was making a plea. That was -- you probably saw that at the beginning, you know, talking about how much, and he`s not going to call it flyover country.

You know, he`ll be in Iowa in 2017. So, he is -- he is trying to root himself into this. But you can tell something changed.

And this goes back to something I wanted to talk about in the first segment there, which is this idea of Donald Trump`s effectiveness.

He is systematically anybody that has caught him, he`s systematically just emasculate in some way and makes them pay for a long period of time and then they struggle.

Jeb Bush, Rick Perry, let`s go to Ben Carson, remember him? There was a time he was a frontrunner.

And Ted Cruz went from -- literally, Cruz was on the move ahead in Iowa, he focuses in on him in ten days and Cruz, you can feel it at his campaign events.

You can feel it in Cruz`s -- you know, they know, they`re suddenly the underdog again. We can underestimate Donald Trump`s effectiveness as a -- basically a negative campaign.

O`DONNELL: Yes, as an attacker. And Tom Davis, it takes me back to the first two weeks of the Trump campaign where I was underestimating him along with most other people.

But the one thing I kept noticing after day two was how long can the Bush people let these attacks go on?

Because when he began, there was only one person he was attacking and it really wasn`t Barack Obama or Hillary Clinton.

It was Jeb Bush. And once we were two weeks into the attacks on Jeb Bush, I was stunned that there was still no response.

And now we`re seeing the focus from Trump almost entirely on Ted Cruz and Cruz is holding it -- is hanging in there a little bit stronger than Jeb Bush did, but it`s pretty relentless.

DAVIS: Well, Cruz has a -- Cruz has a stronger base within the party among religious conservatives.

He has courted these people assiduously over the last few years, and just has a stronger base to start with than Bush did.

Bush has the Bush fatigue. You know, he gives a fire side chat and the fire goes out.

And I think at one point when Trump said low energy, he kind of said it all, and that image kind of stuck, and it`s been hard for Bush to recover from that.

But I`ll say one thing on the debate tonight. Cruz is an excellent debater on debate points, but not particularly likable.

He got into it with Chris Wallace a couple of times --


DAVIS: And I think was more concerned about the debate points than he was in winning the audience.

And my own consultants used to tell me, do you want to like the speech or do you want to like the speaker?



DAVIS: And I think he`s forgotten that.

TODD: I`m with Tom, Lawrence, I`m with Tom there. I thought that, that was -- I thought earlier on, I didn`t think Cruz gave a great first impression in this debate.

And he`s been OK so far, but I`m with Tom, I think that, that could set the tone, and it set it -- it set off bad.

It was just --


TODD: The joke fell flat.

O`DONNELL: Jonathan Allen --

ALLEN: Lawrence --

O`DONNELL: Quickly, Ted Cruz challenged Donald Trump, let`s go one-on-one, you know, if you`re afraid of going against Megyn Kelly, go one-on-one with me.

And of course, Trump`s response was I`ll do that as soon as you can get a court to certify that you are a natural-born citizen.

ALLEN: You got to win a couple of fights before you get the heavyweights out there, Ted Cruz, I think that`s basically, what Donald Trump was saying.

Look, and also, Cruz by the way went after the moderator, went after Chris Wallace, which is a total Donald Trump move --


ALLEN: And he looked terrible doing it.

O`DONNELL: Yes, he did and it was an ugly little bickering start there. Chuck Todd, Tom Davis, Jonathan Allen, thank you all very much for joining us tonight.

I really appreciate it --


O`DONNELL: Thank you --

ALLEN: Thanks --


O`DONNELL: Coming up, a Democratic debate -- about time, between Bernie Sanders and Hillary Clinton, their supporters will be here.


O`DONNEL: Time for another Hillary versus Bernie debate without Hillary or Bernie. Tonight the subject is taxes.


HILLARY CLINTON, (D) PRESIDENTIAL CANDIDATE: I am the only candidate running on either side, who has made this pledge. I will raise your incomes, I will not raise middle class taxes. I do not think it is right to be going to people who suffered because of the republican recession and asking for you to help us make the investments for the future.



SEN. BERNIE SANDERS, (I-VT) DEMOCRATIC PRESIDENTIAL CANDIDATE: If you are paying now $10,000 a year to a private health insurance company, and I say to you hypothetically you are going to pay $5,000 more in taxes or actually less than that; but you are not going to pay any more private health insurance. Are you going to be complaining about the fact that I saved you $5,000 in your total bills?


O`DONNELL: Joining us now, Michael Barr, professor at the University of Michigan Law School and a former Treasury Department Assistant Secretary for Financial Institution. He supports Hillary Clinton. Also with us, Robert Hockett, Professor at Cornell Law School and a former advisor to the Federal Reserve Bank of New York in the International Monetary Fund. He supports Bernie Sanders.

Michael Barr, Hillary Clinton says she absolutely will not raise as she calls it middle class taxes. Does that include the gasoline tax, which was last raised over 20 years ago under President Clinton? We have seen the price of gasoline, which is now at a national average about $1.82. It has been double that during the Obama Administration.

So, obviously there is a tremendous amount of price elasticity available within the price of gasoline that we have seen in the last couple of years alone. Is not there room there to raise the gasoline tax both for revenue and for environmental impact and is that something that Hillary Clinton would be opposed to as a middle class tax increase?

MICHAEL BARR, PROFESSOR AT UNIVERSITY OF MICHIGAN LAW SCHOOL AND A HILLARY CLINTON SUPPORTER: Well, I think that you said it exactly right, that Hillary Clinton has made clear that she is not going to raise taxes on Middle Income families. She said very clearly she wants to raise the income of Middle Class families, not their taxes.

And, instead she would focus on raising taxes on the wealthiest Americans who have benefited so much in the last 15 years with a surcharge on those earning more than 5 million a year, closing the carried interest loophole imposing the buffet rule so that the wealthiest Americans do not get away with paying a lower rate than others. And, that has really been the focus of her plan, protecting middle class families, investing in the country, making sure the wealthiest pay their fair share.

O`DONNELL: Robert Hockett, the last time the gas tax was raised. It was 4.3 cents. That is the most they could actually get at that time. It was pushed by Vice President Gore as an environmental measure. It was also an important revenue measure at the time. Does Bernie Sanders believe that there is room to increase the gas tax and it should be increased, both for environmental reasons and revenue?

ROBERT HOCKETT, LAW PROFESSOR AT CORNELL UNIVERSITY AND A BERNIE SANDERS SUPPORTER: Well, thanks, Lawrence. It is certainly not his focus now, right? The focus of Senator Sanders at this point is actually raising the marginal rate of the top earners like Senator Clinton. It is currently about 39.6 marginal rate -- raised to about 52.

And, then of course the other plan is to fund Medicare for all program essentially by assessing a premium about $45 a month, which would save the average working American about $6,000 a year on health cost or health insurance costs. And, it should be at least $5,400 per employee.

BARR: Robert, the basic problem with that, though, is that he has made it clear he is going to raise taxes on middle class families to fund that attempt to redo our health care system.

HOCKETT: I do not think that is quite right, Michael.

BARR: It is quite risky.

HOCKETT: I have all the respect in the world for Michael, but I do not think that is quite right. I think it is better to look at that as a premium, right? Because if you are going to offer health insurance to all Americans now, universally as all of our pure nations do and you are going to charge $45 a month in premium and you are going to save them nearly $6,000 a year, plus save the employers $9,400 per year per employee, one ought to view that as a tax but as a premium that is going to save a lot of Americans.

BARR: The problem is we have a very strong tradition in this country of developing our health care system incrementally over time. And, there is many countries in the world that have done that with very good outcomes.

HOCKETT: I think that is true.

BARR: We have just gone through a wrenching debate where we expanded the basic access to health care in this country through Obama Care. And, I think it is a very risky proposition to say that we are going to throw that away and start over.

HOCKETT: Well, I do not think that, that is the problem. The problem Michael -- I do not think we are going to throw that away --

BARR: And, in the process impose this new middle class tax at a time when families really cannot afford that burden.

HOCKETT: So, I have to agree with you that it is good to raise and essentially to expand the coverage incrementally, and that is exactly what Senator Sanders wants to do. He applauds Obama Care. He helps to write it as he says often. But, it is time incrementally if you go even beyond that and there is no scrapping involved in what we have.

BARR: I think that you can go beyond that quite easily and Secretary Clinton has a very strong plan to do that including a new tax cut for low income household, middle income households to be able to afford better than the out of pocket expenses. I think that is the kind of incremental approach that can make a difference, but if you say that we are trying to scrap --


O`DONNELL: Michael. Michael, let us let Robert respond here. Go ahead, Robert.

HOCKETT: Yes. So, Michael, I applaud Secretary Clinton`s plans to expand health care coverage as well. I just do not think it goes far enough. If she tells us that she can save $6,000 per American per annum and can save $9,400 per employers per annum to employers thereby opening the door to employing more people, right? And, -- or raising salaries or wages, then I will be very impressed, but at this point it seems to be only Senator Sanders, who is promising anything of that sort. And, he has got it entirely covered --

BARR: I think those kinds of promises are really -- you know, they are empty. You do not want to promise things that are extremely difficult to deliver and in the process of doing that undo the gains that we fought so hard to get. And, I think Obama Care is a singular achievement -- I think Obama Care is a singular achievement that secretary Clinton has a clear plan to build on that.

O`DONNELL: We are just about out of time.

BARR: And, I think that we draw back --

O`DONNELL: Michael, let me just interject this before we go. It is arguable that everything, each of the candidates is proposing in taxation and in health care is theoretically impossible if -- especially if Paul Ryan is the speaker of the house, because this legislation would have to begin as the constitution requires in the house of representatives. It would not get a hearing. So, when we discuss, certainly, this area of it, the actual likelihood of legislating might be something that we do not spend a lot of time on because both of these --

BARR: I think we need to care. I think we need to care about what is --

O`DONNELL: Wait. We are out of time.

BARR: -- actually effective or can actually deliver health care.

O`DONNELL: Yes. And, the answer is nothing. If you are going to play that -- hold it. Michael, stop. Stop. Michael stop the filibuster, please. Please, stop. Will you stop? OK. Now another person can speak.


If you are going to play the game of realism, if that is what we are going to do then the realism is nothing, nothing that either one of them are talking about will even get a hearing in Paul Ryan`s house of representatives. Now, that is a separate game to play. Arguing the actual merits of the policy is something I would like to do here.

HOCKETT: Exactly.

O`DONNELL: We are out of time for tonight. We will come back and we will continue these debates on the policy levels.

BARR: It will be my pleasure.

O`DONNELL: And, also Michael some night we will have that discussion too about the realistic possibilities with a republican congress or in the eventuality that we get a democratic congress. Michael Barr and Robert Hockett, thank you both very much for joining me tonight.

HOCKETT: Thanks Lawrence and thanks Michael.

BARR: My pleasure.

O`DONNELL: Up next, a new poll shows exactly how turnout will determine the winner in Iowa for democrats and republicans.



O`DONNELL: It is all about turnout. You hear that about elections all the time, but it matters in Iowa more than ever. Consider the Monmouth poll in Iowa that estimates 170,000 republicans participating in the caucuses on Monday. With that estimates, Donald Trump gets 30 percent of the support of caucus goers. Ted Cruz gets 23. But when Monmouth increased the turnout projection to 200,000, Trump`s lead goes up 32, Cruz is 21.

But when you decrease, you push it down 130,000, the gap between Cruz and Trump basically becomes a tie at 26. Monmouth projects 110,000 democrats. If you do that in the Iowa caucus, it shows Hillary Clinton would get 47 percent of that. Bernie Sanders getting 42 percent. If you increase that turnout to 150, then the Clinton`s lead narrows 46, 43. Then you are in the margin barrier. If you go way up to 200,000, the race is even tighter, 45, 44.

Joining us now, Trip Gabrial, Political Reporter for the New York Times. He had been covering this campaign in Iowa for the past year. Trip, the highest as I recall -- the highest Iowa turnout we have seen before is lower than the numbers they are using in that Monmouth poll even the lowest number they use there is higher than the records we have seen.

TRIP GARBIEL, POLITICAL REPORTER, THE NEW YORK TIMES: Monmouth does not have a lot of experience polling in Iowa and I really question those numbers. Talking to the people on the ground here, who have done this cycle after cycle. I do not think we are going to see those upward numbers reached by either party.

O`DONNELL: And, so, Bernie Sanders is very clearly making the argument to his people, it is all about turnout and they must have polls indicating exactly, what Monmouth is indicating, maybe in a different curve with a different set of thresholds. But for Bernie Sanders, it seems turnout is everything. -- Trip, I am not sure if you can hear me there in the gymnasium.

GABRIEL: I did not hear that question. I am sorry.

O`DONNELL: OK. For Bernie Sanders, it seems more -- that campaign seems much more dependent on turnout than the Clinton campaign.

GABRIEL: That is right. I mean the same as true for Donald Trump and Bernie Sanders, they both appeal to voters, who have not caucused traditionally, so they are new voters. And, the higher the turnout numbers the better each of them will do.

O`DONNELL: Which of those campaigns is doing a better job of basically instructing its supporters, who are not familiar with this about how to get involved?

GABRIEL: The Sanders campaign is doing a great job. They have over 100 paid staff here sort of pretty comparable to the Hillary Clinton campaign. The Trump campaign -- the republicans do it differently. They do not have anywhere near that amount of field staff. They are relying on the enthusiasm for Donald Trump, which you really do see at a Trump rally. They have a certain amount of organizing, but they are really relying more on people to self motivate.

O`DONNELL: Trip Gabriel, thank you very much for joining us from Iowa tonight. I really appreciate it, Trip.

GABRIEL: You bet. Thanks.

O`DONNELL: Coming up, the story of a real hero and how she saved lives.



O`DONNELL: And, now tonight`s her story. Susan Jordan, the principal of a public elementary school in Indiana. In the age of school shootings, probably most public school teachers have asked themselves what would I do if it happened here, but none of them could have imagined what happened at Susan Jordan`s school, Tuesday. In a freak accident, a school bus suddenly jumped the curb right in front of the school. Jacob Heffner was on the bus.


JACOB HEFFNER, STUDENT: We started going forward and we hit a tree. And, I was just really scared because I did not know what was going to happen.

O`DONNELL: What happened is 69-year-old Susan Jordan pushed kids out of the way of that bus just before the bus hit her and killed her. The head of the school`s parent and faculty organization said this yesterday.


AMY BILYEU, ASSISTANT PRESIDENT AND FACULTY ORGANIZATION: She was much more than the principal of my children`s school. She was my friend. She was an amazing leader. She made the staff understand how much she believed in them and the staff in turn felt so empowered to make sure that the children would thrive at that school. She was just amazing.


O`DONNELL: Every morning when parents send their kids off to school everywhere in the world, they are hoping they are sending them into the temporary care and custody of people like Susan Jordan. There are thousands and thousands of Susan Jordans working in our schools all over the country and every one working in those schools know exactly who they are.


UNIDENTIFIED MALE REPORTER: When you heard that in her final moments she was pushing kids out of the way to save them from that bus.

DENNA RENBARGER, DIRECTOR OF EARLY CHILDHOOD EDICATION FOR THE SCHOOL DISTRICT: I said that is our Susan. That is our Susan. She is a hero. She was a hero every day.


O`DONNELL: Susan Jordan was in one of those occupations like nurse and doctor where every day they do hugely important and heroic things that are never heard about outside of their workplace. The occupations where the heroes never get thanked enough.

Everyone at Susan Jordan`s school thought of her as a hero long before yesterday. The school made a YouTube video last year that gave Susan Jordan the gift that matters most to teachers, the loving gratitude of her fellow teachers, and the kids to whom she devoted her life and Tuesday for whom she gave her life.



GROUP OF STUDENTS: Thank you, Mrs. Jordan. Thank you, Mrs. Jordan. Thank you, Mrs. Jordan. Thank you, Mrs. Jordan. We love you, Mrs. Jordan. We miss you, Mrs. Jordan. We love you. Thank you, Mrs. Jordan. We love you.

Thank you, Mrs. Jordan. J is for joyful to be around. O is for honor all you do. R is for radiant, because you Mrs. Jordan is radiant. D is for demand because you demand that we do our best every day. A is for awesome because you are an awesome principal. N is for nice because you are always nice to work with.


O`DONNELL: Susan Jordan, remember her story. Give your teachers and your principals a hug tomorrow.


O`DONNELL: Donald Trump`s says he is raising money for veterans groups tonight, but there is absolutely no evidence that, that money is on its way to veterans groups. We will be right back.


O`DONNELL: Donald Trump is out there tonight, saying he is all about the vets, right? He is there to support the veterans. Well, he has been very stingy about that in the last five years. In the last five years, 1.5 percent of his charitable giving has gone to veterans organizations, but that did not stop him tonight from pretending to be the big champion of veterans.


DONALD TRUMP, (R) PRESIDENTIAL CANDIDATE: Once this started, it is for our vets. There was nothing I could do. I do not know -- and you know what, I do not know. Is it for me personally, a good thing, a bad thing, will I get more votes, will I get less votes, nobody knows. Who the hell knows? But, it is for our vets. And, you are going to like it because we raise over $5 million in one day, over $5 million.


Donald Trump, another great builder in New York, now a politician. Donald Trump gave $1 million, OK?


O`DONNELL: Joining us now, Jon Soltz, the Chairman of the Jon, I do not know about you, but I will not believe any of it until there is a provable paper trail about where this money goes.

JON SOLTZ , CHAIRMAN, VOTEVETS.ORG: Yeah, obviously he does not know any veterans organizations. All day people have been pressed about where the money is going to go. And, I think one of the reasons that he does not know where it is going is because he has not been involved in this space.

I mean those of us who have been involved, whether it is the C3 side or the political side that both vets are involved with, Donald Trump has not been a player in helping veterans. What he is actually best known for is fighting the state of New York for the ability that they give people in New York to be vendors if they are disabled or just veterans.

And, so, up to this point, he is basically known for doing things that hinder veterans employment, not helping them. And, so, when I see this grandstanding tonight, it really hurts me. And, I think I speak on behalf of all of the veterans organization, the family members to tell Donald Trump do not hide behind veterans, because you are afraid to face Megyn Kelly in a political debate.

O`DONNELL: And, what we do know about the money tonight is that it is going to the Donald J. Trump Foundation. That is going to his personally foundation, which he personally controls. And, what we do not know about that foundation is how salaries are paid out of that foundation.

A lot of charitable foundations are allowed -- end up using money recklessly. We saw one group that is out there, Wounded Warriors supposed to be working on behalf of veterans, where according to the New York times about 50 percent, 50 percent of the revenue they get is spent on salaries, first class travel, things like that.

SOLTZ: Yes, obviously, I do not know how his foundations run, but I think the larger points there is how many veterans groups have come out and said, "Donald Trump, we want your money." I mean, again, he is not someone, who has any relationships in the space. He is not on the board of any veterans organizations.

It is just this term we use in sort of the space that is called, pet-a-vet. It is like when you want to look good for the cameras, you bring a bunch of veterans out and pet them. And, so, this is just a grand standing opportunity for him. You know, we will see if the money goes anywhere.

But if he was really close to our community and he really wanted to help veterans, he would know exactly what those organizations are, exactly what they do in the space, whether it is homeless veterans, whether it is PTSD, whether it is veteran suicide. He knows none of that. So, the only place he could put the money is in his own foundation. And, then we have no idea where it goes or who it is going to go to.

O`DONNELL: There are a lot of very prominent people and prominent New Yorkers who have been working very hard in the chartable arena for veterans over the years. John Stewart and others, and Donald Trump knows some of those people. He could have gone to some of those events if he wanted to.

SOLTZ: Yeah, look there is a lot of great organizations out there, the Fisher House. You know, there is all these organizations right now in sort of the social welfare space mission continues. They get veterans involved. There are things like Team Rubicon. They go out and veterans helping in emergency situations like hurricane Katrina. So, Donald Trump has not been a player in that space, whatsoever.

O`DONNELL: Jon Soltz, thank you very much for joining us, again, tonight.

SOLTZ: Thank you.

O`DONNELL: MSNBC special coverage of the Republican Debate begins now with analysis from Chris Matthews live with Chris Matthews.