Show: THE LAST WORD WITH LAWRENCE O`DONNELL Date: October 3, 2016 Guest: David Cay Johnston, Daniel Shaviro, Rick Wilson, David Corn, Mike Murphy, Kurt Eichenwald, Peter Wehner
RACHEL MADDOW, MSNBC HOST: That does it for us tonight, we will see you again then, now it`s time for THE LAST WORD with Lawrence O`Donnell, good evening Lawrence.
LAWRENCE O`DONNELL, MSNBC HOST: A gentleman`s debate, are you ready for that, Rachel?
MADDOW: The fact that they both are 57 or 58, 5`10 or 5`11 and they both weigh exactly 208 pounds --
O`DONNELL: Yes --
MADDOW: I feel like I want to see them box more than I want to see them talk.
O`DONNELL: They -- I don`t think those are the kinds of guys that do that.
MADDOW: Well, maybe we`ll be surprised.
O`DONNELL: We`ll see --
(LAUGHTER)
Thank you, Rachel --
MADDOW: Thanks, Lawrence --
O`DONNELL: Kurt Eichenwald will join us tonight with his latest expose in "Newsweek" about Donald Trump using Chinese steel in his construction projects.
Something that Donald Trump promises no one will be able to do if he becomes president. And Mike Murphy is here to take a look at the new polls showing Hillary Clinton moving up, national polls and battleground state polls. But first, the billionaire`s tax return that doesn`t look like a billionaire`s tax return.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Welcome to another week of, yes, this is really happening.
(LAUGHTER)
UNIDENTIFIED FEMALE: He`s either not that rich.
ALEC BALDWIN, ACTOR: Wrong.
UNIDENTIFIED FEMALE: Not that charitable.
BALDWIN: Wrong.
UNIDENTIFIIED FEMALE: Or he`s never paid taxes in his life.
BALDWIN: Warmer.
(LAUGHTER)
HILLARY CLINTON (D), PRESIDENTIAL NOMINEE: Doesn`t look like he paid a dime of federal income tax for almost two decades.
DONALD TRUMP (R), PRESIDENTIAL NOMINEE: Oh, they were amazing times. But I`m working for you now, I`m not working for Trump.
CLINTON: That is like letting the fox guard the hen house, right?
TRUMP: Believe me.
CLINTON: In the debate, he said it was smart to avoid paying taxes.
TRUMP: What does that make the rest of Americans? What?
RUDY GIULIANI, FORMER NEW YORK CITY MAYOR: The reality is, he`s a genius.
GOV. CHRIS CHRISTIE (R), NEW JERSEY: There`s no one who`s shown more genius.
GIULIANI: Genius? Absolute genius.
TRUMP: I`m a star, thank you, you are too.
CLINTON: Here`s my question. What kind of genius loses a billion dollars in a single year?
(APPLAUSE)
(END VIDEO CLIP)
O`DONNELL: I cannot believe my luck tonight. There`s actually still stuff to talk about in the Donald Trump tax return that nobody`s really concentrated on yet.
Yesterday, when I read Donald Trump`s tax return, the one that was reproduced in the "New York Times" in print, I circled one number, and only one number.
The most important number in the return to me and to Donald Trump, the number that exposes Donald Trump`s darkest secret, and I can`t believe that that number is still just sitting there in the tax return and no one is really talking about it yet.
The "New York Times" article didn`t even really mention that number. It is the number that humiliates Donald Trump, and so I`m not the only one who`s happy that it`s still sitting there waiting to be talked about.
Donald Trump has to be very happy tonight with the media coverage so far because no one has paid any attention to that number on his New York State tax return.
The one that is most important to him. It`s not the $915 million in losses that the return shows. That`s the thing he insists makes him smart because that`s the thing that allows him to pay no federal income taxes, possibly for 18 years.
Losses like that apparently still allow Donald Trump to pay zero income taxes, because in the debate last week he had a very easy opportunity to deny that he pays no income taxes, and he didn`t do that.
(BEGIN VIDEO CLIP)
CLINTON: Or maybe he doesn`t want the American people, all of you watching tonight to know that he`s paid nothing in federal taxes because the only years that anybody`s ever seen were a couple of years when he had to turn them over to state authorities when he was trying to get a casino license.
And they showed he didn`t pay any federal income tax. So, if he`s --
TRUMP: That makes me smart --
CLINTON: Paid --
(END VIDEO CLIP)
O`DONNELL: You know, if Donald Trump was paying federal income taxes now, he would have said that makes me smart and I pay a lot of federal income taxes now or I`ve paid a lot of federal income taxes since then.
We had gotten to the point Sunday when the "New York Times" revealed these documents that it wasn`t really surprising news that Donald Trump paid no federal income tax.
But what we got on Sunday was very important. It was proof that he paid no federal income tax for the tax year 1995. And it was proof of something else, something that is Donald Trump`s darkest secret.
Donald Trump`s darkest secret has nothing to do with how his hair is attached to his head or his marital infidelities or his many business bankruptcies. There`s plenty of public information on all of that already.
Donald Trump`s darkest secret is the truth behind the piece of his image that is most important to him. And we know that it is important to Donald Trump, very important, that you think that his fingers are not short.
Even though his every hand gesture proves the opposite. It is very important to Donald Trump that you think that these cylindrical protuberance that you cannot see, that you would never want to see is not short.
(BEGIN VIDEO CLIP)
TRUMP: Look at those hands, are they small hands?
(LAUGHTER)
And he referred to my hands, if they`re small, something else must be small. I guarantee you, there`s no problem. I guarantee.
(LAUGHTER)
(END VIDEO CLIP)
O`DONNELL: Donald Trump is obviously oblivious to the general societal agreement among virtually everyone who can spell the word psychiatrist.
That verbal guarantees of that sort are usually contra-indicators. That sort of guarantee he felt compelled to offer from the presidential debate stage is almost a guarantee of the opposite.
And so, so it is with male bragging generally. If you tell me what a guy brags about, I can tell you what he`s lying about.
And what does Donald Trump brag about the most? What does he brag about more than even than body parts? What does he brag about even more than his ability to romance women who have a strong attraction to moneyed men?
What does Donald Trump think is the single most important thing about Donald Trump?
(BEGIN VIDEO CLIP)
TRUMP: I`m really rich -- oh, I am one of the very rich. In all fairness, I`m rich. Hey, I`m rich. I`m rich.
(END VIDEO CLIP)
O`DONNELL: Have you ever heard this guy say that? I`m very rich? How about this guy? Do you ever hear him say that? There are a lot of richer people than Donald Trump.
Bill Gates is 20 times richer than Donald Trump according to the "Forbes" estimate of Donald Trump`s wealth. "Forbes" estimates that Donald Trump is worth only half of what Donald Trump says he`s worth.
"Forbes" says he`s worth only about $4 billion. Each Koch brother is worth ten times more than Donald Trump, according to "Forbes". Each one of them.
But what if Donald Trump isn`t even worth what "Forbes" says he`s worth. "Forbes" has never had a chance to look at Donald Trump`s 1995 tax return or any tax returns until now.
And there in line 6 of the return is the most important number in that tax return for Donald Trump and for me. The number Donald Trump never wanted anyone to see.
Donald Trump`s earned -- actually earned income for 1995 was only $3.5 million, $3,427,092. That is less than local New York TV news anchors earn in a year, $3,427.92 -- $3 million, sorry, $3,427,092.
It`s a huge income, just a huge, gigantic life-changing income for anyone who doesn`t call himself a billionaire. Billionaires have incomes of hundreds of millions of dollars a year.
Some of them, a billion or more a year in income. There are corporate executives with incomes of $40 million a year, employees, $40 million a year, and they`re not billionaires. It`s hard to be a billionaire.
It takes a lot of money to be a billionaire. Most ultra rich people who have more money than they know what to do with are not billionaires. Short-stops and actors make $15 million a year and they`re not billionaires.
Three-point-four million dollars in earned income in 1995? Eight years before that, Donald Trump was claiming billionaire status.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: You are the antithesis of the billionaire recluse, the Howard Hughes, aren`t you?
TRUMP: I don`t know about that. I know that I work very hard, I love what I`m doing.
(END VIDEO CLIP)
O`DONNELL: He also knows that Howard Hughes was a real billionaire, and he isn`t. Of course, if Donald Trump was only lying about being a billionaire right up to the 1990s, and then he actually became a billionaire, he could prove that by releasing his tax returns.
But as of now, all of the tax information that has ever been seen on Donald Trump shows him to be a billionaire only in his own mind. Joining us now, David Cay Johnston, a Pulitzer Prize-winning journalist and columnist for the "Daily Beast".
He is the author of "The Making of Donald Trump". Also with us Daniel Shaviro, Wayne Perry professor of taxation at the New York School of Law.
David, the other thing I noticed on there was he`s got $7 million in interest income, which is an indicator of maybe $100 million in interest- producing assets.
DAVID CAY JOHNSTON, COLUMNIST, DAILY BEAST: Hundred to hundred and fifty - -
O`DONNELL: Yes --
JOHNSTON: Right --
O`DONNELL: And we`re still -- there`s no indicator of billionaire in these tax returns.
JOHNSTON: There is no evidence whatsoever that Donald Trump is a billionaire. He`s a wealthy man. Anybody --
O`DONNELL: Yes!
JOHNSTON: Who makes $3.4 million --
O`DONNELL: Right --
JOHNSTON: Is a wealthy man.
O`DONNELL: Right --
JOHNSTON: But there`s no indication at all that he`s a billionaire, and there never has been any indication.
O`DONNELL: So, how did -- how did he pile up the $915 million in losses? You have mapped it out, and I read it, and I believe I understand it, but I can`t explain it.
JOHNSTON: Well --
O`DONNELL: And all those things that I only have it here now, I haven`t got it to the point where I can say it.
JOHNSTON: Start with a billion dollars of highly-leveraged assets that your banks put up all the money for and mismanaged them is --
O`DONNELL: Yes --
JOHNSTON: The short version --
O`DONNELL: Right --
JOHNSTON: Of that. But what`s astonishing is what he did with this $900 million, it`s only good for 18 years. That means he would have to be making way above $3.4 million or even with the interest, $10 million a year for it to be useful to him.
He can`t take it all. He will run negative income all the way until it`s run out. He wasn`t even smart enough as a businessman to figure out how to reorganize his finances so that other people could in fact buy those tax losses and reduce their own tax bills.
O`DONNELL: Right --
JOHNSTON: Something by the way -- I advised him to do over lunch in 1990.
O`DONNELL: But professor, let me -- this thing about the $900 million, if he really was a billionaire, and he had a year where he made, say, $300 million --
DANIEL SHAVIRO, WAYNE PERRY PROFESSOR OF TAXATION: Yes --
O`DONNELL: If he did that three years in a row, that loss would --
SHAVIRO: Oh, yes --
O`DONNELL: Disappear in three years. The fact that he could use that loss for 18 years is an indicator that he`s making less than -- on average --
SHAVIRO: Yes, right --
O`DONNELL: Fifty million a year.
SHAVIRO: You know, it`s a funny number in that thing that he only paid himself $6,000 of salary, but I think he might have been overpaid given that $900 million --
O`DONNELL: Yes --
SHAVIRO: So, that was sort of the tax lawyer in me says that`s kind of an attempt to scam the Social Security, Medicare systems by having very low --
O`DONNELL: Right --
SHAVIRO: Especially Medicare never runs out, you have to pay tax on that, so, he pays himself a low-ball salary. But then again maybe --
O`DONNELL: Because you --
(CROSSTALK)
Because you only pay payroll taxes on that salary income, so he can get us to --
SHAVIRO: Yes, that`s right --
O`DONNELL: So, he gets to keep it low. But you`ve also raised the possibility that even in the debt, it`s other people`s money --
SHAVIRO: Yes --
O`DONNELL: Meaning --
SHAVIRO: Oh, yes --
O`DONNELL: It`s other people`s debt that he`s exploiting for his tax return.
SHAVIRO: Yes, I know, the money that he put up was mainly debt money, and so was the bank`s. So, I think net operating losses, some tax people will say, well, if you lose the money you shouldn`t have income until you earn it back and more.
But if he was losing other people`s money, that`s kind of a different kettle of fish.
O`DONNELL: David, what else would you divine from what we`ve got here so far?
JOHNSTON: Well, I think the most fascinating thing is something a little bit different, and that`s how he used the tax code to get out of an immediate tax bill.
When the bankers wrote down almost a billion dollars of his debt, when your debt`s canceled, that`s income to you. If you --
O`DONNELL: Yes --
JOHNSTON: Didn`t pay the bank back --
O`DONNELL: Right --
JOHNSTON: You have to pay taxes. And there`s a provision in the real estate lobby got into the law that says, well, if you have other buildings, you can reduce their value for tax purposes and defer paying the tax.
So, that`s what Donald does, he shifts it, and then he creates this company that`s a publicly-traded stock-held company and puts these now reduced value buildings into it, people buy this stock, they lose their shirts.
The stock price goes from $35 down to 17 cents, but Donald gets $82 million in salaries --
O`DONNELL: That --
JOHNSTON: But he loses a billion --
O`DONNELL: That stock collapse was the Atlantic City Casino`s thing --
JOHNSTON: That`s right --
O`DONNELL: Where the -- where you could buy stock, and it`s starting at about 35 bucks, when it`s -- and then --
JOHNSTON: Right --
O`DONNELL: By the time you woke up, basically it was --
JOHNSTON: It was gone --
(CROSSTALK)
And yes, Donald got $82 million out of the company as it lost under his chairmanship $1.1 billion. I mean, this is -- Donald`s history here is lose money and take a lot for yourself and leave your workers, your vendors and now your investors in the lurch, because that`s smart.
O`DONNELL: He is saying on the campaign trail that he`s going to fix everything that`s wrong with the tax code. In fact, I think we might have some sound of him saying that today, is that ready?
(BEGIN VIDEO CLIP)
TRUMP: I understand the tax laws better than almost anyone. Which is why I am one who can truly fix them. I understand it, I get it. And that is what I commit to do.
We want fairness, we want money brought in, and we want money to be spent when it goes out, because they spend our tax dollars so unfairly and unwisely, remember that.
(END VIDEO CLIP)
O`DONNELL: Professor, if he`s going to make it fair for everyone, he has to change basically all of the laws he`s using --
SHAVIRO: Well, I don`t think he`s read his own tax plan, because it does nothing but cut taxes for people like himself and uses -- gets rid of none of the scams that he appears to have used.
So, it`s kind of funny that he will say that -- by the way, even if he appeared more capable of like reading lengthy statutes and regulations than we`ve seen as the case, no man in his position is going to be doing his own tax planning, that`s why --
O`DONNELL: Right --
SHAVIRO: You hire lawyers for --
O`DONNELL: Right --
SHAVIRO: Accountants.
O`DONNELL: We`re going to have to leave it there for tonight, David Cay Johnston and Daniel Shaviro, thank you both for joining us tonight, really appreciate it.
Up next, the Clinton campaign intends to use the Donald Trump tax returns to their advantage, they already are. In the campaign war room tonight, Hillary Clinton getting good news in all of the polls; national polls and battleground states.
Mike Murphy will take a look at those polls, and Kurt Eichenwald coming up with his new expose in "Newsweek" about Donald Trump using Chinese steel in his construction projects.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
CLINTON: In the debate, he said not paying taxes made him smart.
(BOOING)
But think about what that means. It means that all the rest of us who pay our taxes, right? What`s he saying about us? But more than that, zero taxes means zero for our vets, zero for our military, zero for Pell Grants to send young people to college, zero for health. Zero for education.
(END VIDEO CLIP)
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
CLINTON: He is the poster boy, the poster boy for the same rigged system that he would make even worse. Just think about it. He paid zero at least for about 20 years we believe, now based on what we know.
And he`s advocating for huge tax cuts that would help him and his family even more. What do you want us to do? Pay him to lose money?
AUDIENCE: No --
CLINTON: Really?
(END VIDEO CLIP)
O`DONNELL: A new "Cnn" national poll of likely voters out today shows 86 percent say it is every American`s civic duty to pay their fair share of taxes. The same poll shows 73 percent of voters want Donald Trump to release his tax returns.
Fifty six percent think Donald Trump hasn`t released his tax returns because he`s trying to hide something from the public, they figured it out.
Thirty five percent believe it is because Donald Trump is being audited by the IRS. Joining us now, Rick Wilson; Republican strategist and contributor to the website "Heat Street".
And David Corn, Washington Bureau chief for "Mother Jones" and an Msnbc political analyst. And Rick, the -- I just want to go to Chris Christie`s defense this weekend of Donald Trump on this.
Because apparently, Donald Trump himself writes the talking points. Let`s listen to this.
(BEGIN VIDEO CLIP)
CHRISTIE: There`s no one who has shown more genius in their way to maneuver around the tax code as he rightfully used the laws to do that. This is actually a very good story for Donald Trump.
(END VIDEO CLIP)
O`DONNELL: And we`ll save the Giuliani saying genius. You know Donald Trump wrote that particular talking point --
RICK WILSON, REPUBLICAN STRATEGIST: Absolutely. And look, Lawrence, as you said earlier, this speaks to what he`s most nervous about, what he`s most sensitive about is that Donald Trump -- as a hedge fund client of mine said to me once, he is not a billionaire.
I`m a billionaire.
O`DONNELL: Right --
WILSON: He`s a clown living on credit. And this is a guy who`s desperately trying for people to not discover this. And this is a big blow to him, I think. This is a huge mental blow to him.
O`DONNELL: Well, David, it`s definitely a blow to him personally for these numbers to be out there, and for me to be able to sit here and literally laugh as I did, at his $3.4 million earned income in 1995, which shows you why he so desperately needed the apprentice to come along when it did.
But -- because the guy claims, you know, to be a billionaire, and you know, everything we`ve seen says he isn`t.
DAVID CORN, WASHINGTON BUREAU CHIEF, MOTHER JONES: Well, I`m waiting for his supporters to call his lack of tax payments an act of courageous civil disobedience. They will spin this any way imaginable.
And I think their heads must be spinning because just in the last day, they have to deal with the Trump Foundation being cited for taking contributions illegally in New York State.
They have to deal with him mocking Hillary and making accusations that she`s cheating on Bill with no evidence. They have to pay attention to stories saying that he made sexist and rude remarks when he was running "The Apprentice" TV show.
I mean, this guy is sort of like -- I don`t know, you -- every -- you know, if you throw one plate of spaghetti on the wall, you notice it, right? But when you throw 50, 75, 100 plates of spaghetti on the wall, eventually they all blend together.
You know, we haven`t talked about his birtherism in weeks, Trump University, when was the last time we mentioned that? You know, Khizr Khan, Judge Curiel.
I mean, his ties to the mob. I mean, it`s -- this guy is a walking encyclopedia of opposition research and yet he`s still hanging in there.
O`DONNELL: Let`s take a look at the way the Clinton campaign is using the latest revelations in an ad.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: You work hard, you pay your taxes. So, why didn`t Donald Trump pay his? He claims he`s worth $10 billion. But a new report shows he may not have paid any federal taxes for almost 20 years.
CLINTON: He didn`t pay any federal income tax.
TRUMP: That makes me smart.
CLINTON: If he`s paid --
UNIDENTIFIED FEMALE: If he thinks that makes him smart, what does he think of you?
TRUMP: How stupid are the people of the country?
(END VIDEO CLIP)
O`DONNELL: And Rick, 79 percent -- and this poll came out there, 79 percent of Trump supporters think it`s their -- it`s your civic duty to pay taxes. Now, they have to be not very surprised about this. Because we`ve been kind of hinting at this for a long time.
But it`s one of those things, the difference between the suggestion of the possibility and then the proof. Here`s a tax return, it shows zero.
WILSON: Look, this is -- this is why he`s hidden this for so long. This is why the audit thing has always been a lie. The IRS --
O`DONNELL: Yes --
WILSON: From the beginning, it was a lie.
O`DONNELL: Right --
WILSON: And his people have insisted it`s absolutely the truth, it`s carved in stone. But this is a guy who`s desperate for us not to know that he is not as wealthy as he is.
That his charitable contributions are nonexistent. And frankly, that he`s using, you know, a series of tax loopholes to advantage himself.
And look, that may be perfectly legal, but his whole self-image is built around, I am the wealthy guy, I am beyond all the small machinations of politics because I am worth $10 billion.
And, you know, he`s not. And he`s much smaller figure and a much weaker figure and a much more delicate figure mentally, I think after this -- after this revelation.
O`DONNELL: David Corn, if we`re all lucky here, maybe this can actually get the campaign on to the subject of taxation, something that didn`t really come up in the first presidential debate.
These people have -- these two candidates have wildly different views of taxation and different taxation programs that they`re advocating, and neither one of them have really been heard.
CORN: Well, I think mainly, this has been a campaign of character and personality traits, and I don`t expect that to change too much. I mean, Donald Trump shows no interest in any policy other than the wall.
What he really cares about when you look -- read any of his speeches is talking about himself. Now, a story that we put up on "Mother Jones" yesterday did point out that many times in the past couple of years, he has denigrated half of America for not paying taxes.
He says if these are people who feel they`re entitled to get a free ride, very much like what Mitt Romney said with the 47 percent remark. He said that over and over again.
I like to have someone ask him as a bait or if he ever talks to a reporter again, how he squares that with the fact that he seems to be in the half of Americans who aren`t paying taxes.
When most of those actually are working poor, senior citizen students who don`t generate enough income to qualify for federal income taxes.
O`DONNELL: David Corn and Rick Wilson, thank you both for joining us tonight, really appreciate it --
WILSON: Thanks, Lawrence --
CORN: Thank you, Lawrence.
O`DONNELL: Kurt Eichenwald will join us, he has his latest "Newsweek" expose about Donald Trump using Chinese steel in his construction projects, something that Donald Trump says he would prevent if he is elected president.
And also coming up, the physical comedy of Donald Trump, the man who has said he`s willing to go to war with Iran over a hand gesture has the strangest hand gestures in the history of presidential candidates.
(COMMERCIAL BREAK)
O`DONNELL: Donald Trump can`t sleep. And he can`t stand still. And maybe he can`t sleep, because he can`t stop making hand gestures in the middle of the night. He`s the only presidential candidate in history who`s decided he`s willing to go to war -- nuclear war if necessary over a hand gesture, an undescribed hand gesture that someone on a small boat in the Iranian navy might someday make within sight of someone on an American naval vessel.
What`s extra troubling about that insane Trump national defense policy is that Donald Trump`s own hand gestures make absolutely no sense. They have no recognizable connection to the words he`s speaking. Watch this.
Tell me, if you can -- no sound here. Tell me what he`s talking about.
That one looks -- any guesses? The only hint I can give you is that the hand gestures have absolutely nothing to do with a single word he said. Let`s see. Any guesses? Let me check twitter here for guesses. You give up? Okay.
Now you`re going to hear the words, and I defy you to find any link between any of the words and anything either one of his hands is doing.
(BEGIN VIDEO CLIP)
DONALD TRUMP (R), PRESIDENTIAL CANDIDATE 2016: And the only thing I can tell you, the only thing I can tell you is they`re getting older, and they`re working harder, and they`re making less. It`s not supposed to be that way. But, you know what? I`m getting older, and I`m working harder now than I`ve ever worked in my life. So we`re all in the same ballpark.
(END VIDEO CLIP)
O`DONNELL: The one physical shtick of Donald Trump`s that is clear is when he tries to do mean impressions of other people. After he did this horribly ugly impression of a disabled reporter who wrote something that Donald Trump didn`t like, Donald Trump of course denied that he was doing his imitation of that disabled man. But the Trump campaign`s breathtakingly incompetent staff seems to have forgotten to tell Donald Trump to stop doing physical imitations of people.
Here he is on Saturday in Pennsylvania.
(BEGIN VIDEO CLIP)
TRUMP: She`s supposed to fight all of these different things. And she can`t make it 15 feet to her car. Give me a break. Give me a break. Give me a break.
(END VIDEO CLIP)
O`DONNELL: We`re only 35 days away from possibly having to suffer four years of Donald Trump`s bad imitations delivered at podiums bearing the seal of the president of the United States. But, new polling tonight indicates that we have a better chance now of avoiding that nightmare. Mike Murphy will join us next in the Campaign War Room.
(COMMERCIAL BREAK)
O`DONNELL: Time for tonight`s Campaign War Room. New polls show that if the election were held today, Donald Trump would be looking for another job in reality TV tomorrow. All post debate polls, both national polls and state polls show Hillary Clinton moving up and in the battleground states as well. Let`s see. The Politico morning consult poll has Hillary Clinton at 42 percent nationally, Donald Trump at 36 percent.
With 35 days left for the campaign war room joining us tonight in the Last Word War Room is Mike Murphy, a veteran of John McCain`s 2000 presidential campaign war room and the former head of Jeb Bush`s right to rise Super Pac. He`s also host of the podcast Radio Free, GOP.
Mike, the round of polling we have now, is this the verdict on that first debate?
MIKE MURPHY, REPUBLICAN POLITICAL CONSULTANT: Oh, I think so. Yes. Polling runs about four to five days behind. But after the (INAUDIBLE) debate, we`re now seeing the first wave of credible polling, and it`s pretty obvious. You know, I think there`s been a trend for a long time that sometimes the reporting misses, but Trump always oscillates between about 41 and 44 percent. He`s kind of stuck there, because he has limited demographic appeal. He can`t get any minority voters and has a problem with Caucasians who are college educated which is a key -- normally a key vote for the Republicans.
On the other hand, when things are not going so well for Hillary, she goes down to the mid-40s, creating in some ways the appearance of a tighter race than might actually be, because when she does better, the conventions or now this debate, she gets back up into the high 40s and the race settles into a four to five point lead for her. That`s where we`re back now with this new polling, and that`s kind of normalcy unless can get a new formula to quit offending everybody particularly college educated white women and Latinos and get back in the race.
O`DONNELL: Well Donald Trump seems to think it`s exactly where he wants it of course as usual, saying that he`s always best when the pressure`s on. Let`s listen to what he said about this.
(BEGIN VIDEO CLIP)
TRUMP: When the chips are down is when I perform the very best. That is always when I perform the best. That`s when I make my best decisions, judgments, remember Bernie saying Hillary Clinton has bad judgment? And honestly, my single greatest asset probably is temperament. Because if you didn`t have the right temperament, you could have never escaped that financial jungle, that`s for sure.
The single greatest asset is my temperament, and I have a temperament for winning. You have to win.
(END VIDEO CLIP)
O`DONNELL: Mike, there`s so much in that one, including by the way just using the phrase "when the chips are down", when you`re behind in the polls. I have never heard a politician in a campaign use the phrase "when the chips are down", even when the chips are down.
MURPHY: Yes. No, look. The truth is if we objectively look at Trump`s behavior, when the pressure`s on, he makes he`s at his worst, he makes his worst decisions.
O`DONNELL: Yes. Yes.
MURPHY: I mean he losses a debate. He goes in to his unreality bubble about phony internet polls and then he decides in the middle of the night let`s relight the story by picking a huge feud with the former Ms. Universe managing in quite a hat trick, I got to give him a kind of an award for it to offend both Latinos and women. Then he doubles down, I think some staff guide that Times had the, you know, have the story about his taxes and was going to publish.
And they basically unscrewed his head and went crazy in public, in real time in Pennsylvania with that speech a few days ago. So, it`s the opposite. The more pressure this guy is under the more he doubles down on the crazy, which of course politically makes the situation worse.
O`DONNELL: Mike, quickly, tomorrow night, the vice presidential debate, what do you expect to see?
MURPHY: Well, I`m planning some dental surgery, because I think it`s going to be a pretty sleepy debate. It`s going to be kind of kitten boxing, I think. They`re both competent governors, they`re both fairly likeable guys. Pence has the tougher job because he`s got to defend Trump somehow.
Well I think Tim Kaine just has to not lose. I doubt this debate will make a huge difference but it maybe entertaining and again, you never know somebody could make a bad mistake and affect the race.
O`DONNELL: Mike Murphy, rest comfortably tomorrow. Thank you very much for joining us.
MURPHY: I`ll be on watching the whole thing. Thank you.
O`DONNELL: Thank you. Up next, Kurt Eichenwald`s report in Donald Trump`s China connection.
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O`DONNELL: Kurt Eichenwald published his latest expose of Donald Trump this afternoon, it was being cited on the campaign trail as soon as Hillary Clinton got to her next microphone.
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HILLARY CLINTON (D), PRESIDENTIAL CANDIDATE 2016: What did we find out today? Well, a story just came out saying that Donald Trump used Chinese steel and aluminum for two out of the last three construction projects. He sent that money overseas. How can he make America great again when he won`t even buy American products in our country?
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O`DONNELL: Kurt Eichenwald`s new report documents Donald Trump`s use of Chinese steel. The latest story for Newsweek has that reporting. Here is what Donald Trump said about steel on Saturday.
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TRUMP: We are going to protect our steelworkers. We can`t let china take advantage of us anymore. Pennsylvania Steel will build this country like it built the Empire State Building many years ago. And Pennsylvania Steel and the incredible steelworkers will send new skyscrapers into the clouds.
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O`DONNELL: Kurt Eichenwald, Senior Writer for Newsweek joins us now. Kurt, Pennsylvania Steel is not going to build Trump buildings if he keeps up his current pattern.
KURT EICHENWALD, SENIOR WRITER, NEWSWEEK: No, it`s not. They`re not. And you know, this again, this is going to this theme of Donald Trump, where it`s, you know, this is what`s good for America. But hey, it`s not good for me.
I`m in business. I need to do other things. And, you know, these purchases, you know, when I say two out of three, the reason it`s two out of three was I didn`t finish the third one. But I figured I had enough I had to print. You know at this point, I`m sure I would find the same thing in the third. He buys foreign steel because it saves him money.
O`DONNELL: And Kurt any one who reads your report is going to discover how hard it was for to you track this steel down since they moved it through a bunch of different corporations with different corporate names some of them located in the British Virgin Islands and other Caribbean tax havens like that. So it`s very hard and would obviously pains taking research on your part to get the China receipt on this stuff.
EICHENWALD: Well yes, I mean Trump isn`t going off and buying from Chinese Steel Incorporated. And we`re talking about holding companies within holding companies within British Island Subsidiaries. And ultimately, you find -- actually even in one instance something that looks like an American company.
But then you find out it`s actually a front for a Chinese company that is dumping, using predatory pricing, dumping aluminum into the United States. And, you know, there`s something that has to be pointed out here. Every time Trump gets caught on one of these things, he just says, well, it shows I`m a good businessman. That`s not what this shows.
You know Donald Trump doesn`t run a public company. He doesn`t have an obligation to shareholders to get the best price. We have a man who says I am so rich, I`m richer than anyone. I can afford anything.
He could have taken a smaller profit. Maybe -- let`s assume he does have $10 billion, which he doesn`t. He could have said, well, maybe I only need $100 million in profit rather than $300 million. He didn`t do that.
He shipped that $200 million overseas. It could have gone to Pennsylvania. It could have gone to Ohio. It could have gone to Wisconsin. Instead, it went to Shanghai.
O`DONNELL: And there`s also a reputation that Chinese steel has within the steel industry as being unbalanced, inferior, certainly to U.S. steel and other steel manufactured from other sources. And so, it`s cheaper for a reason. But the cheapness is the reason that Donald Trump got it.
EICHENWALD: Well, sure. I mean, you know, the less money you spend on a project, the more profit you`ll make. It`s very simple. And, you know, Trump, one of these things this reflects, it`s the same thing as with taxes. It`s the same thing as with violating the Cuban embargo on the hopes of making some money.
All of these things go down to Donald Trump makes decisions based on what`s best for Donald Trump. And what I`m -- I`m so sorry that his supporters don`t understand is that this man has been conning and tricking people in business and people in finance for decades. And, you know, this is just another example of it. And they -- when he sits there saying oh, I want to rebuild the steel industry. But excuse me while I go buy my steel in China. You know there are just the latest marks on his biggest con ever.
O`DONNELL: And Kurt, we could take a look at the Trump policy book and say ah, he wants to fix this. He knows the way Chinese steel is being used. And here`s his proposal to keep that from happening.
But he has made absolutely no proposal at all that would stop his sons and his daughter from using Chinese steel in any of their building projects while daddy`s in the white house.
EICHENWALD: No, and there`s also something very important. We`re not talking about the Head of the Chamber of Commerce. We`re talking about President of the United States. And a person who is running for that position has to be someone who is demonstrating a level of character that they are serving as the example.
That they are saying, you know, I am dedicated to rebuilding America, whether I`m the President or not. And so, I`m going to act in ways that are designed to help America.
You can`t suddenly say, "Hey, if you put me in the big white mansion and give me the big, nice plane, I`ll start working on your behalf, even though throughout my career, I`ve basically just been, you know, putting a gun to your head and pulling the trigger because it`s made me more money." It doesn`t work that way.
O`DONNELL: Kurt Eichenwald, digging into the Trump Empire once again. Thank you very much, Kurt. Really appreciate it.
EICHENWALD: Thanks for having me.
O`DONNELL: Up next, Republicans who support Donald Trump now are going to have to explain it for a long time to come if the democrats have their way.
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REP. PAUL RYAN (R-WI), SPEAKER OF THE HOUSE: I`m not going to sit up here and do the tit-for-tat on what Donald said last night or the night before.
UNIDENTIFIED MALE: Are you still comfortable voting for him to be Commander-in-Chief?
RYAN: I`ll leave it at that.
SEN. JOHN MCCAIN (R), ARIZONA: I have said that I`m running my own campaign. I have said I`d support the nominee of the party.
UNIDENTIFIED MALE: There a lot of months of prayer over (INAUDIBLE) that I`ve decided in November I intend to vote for Donald Trump.
UNIDENTIFIED MALE: Can you tell us you`re still supporting Republican nominee for President?
UNIDENTIFIED MALE: Guys I`m here to talk about -- nothing has changed and I promise you or did would you have heard I`m focused on my own race --
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O`DONNELL: Everything you just heard is going to a Democratic database That Democrats plan to use two years from now in the next Congressional Elections. Today politico reports, Democrats are plotting a post-election day campaign against individual Republicans for nominating and sticking by Donald Trump. Anyone who stood with Trump these Democrats intent to say enabled racism, irresponsibility and a departure from conservative principles.
Joining us now Peter Wehner, Senior Fellow at the Ethics and Public Policy Center. He worked in the last three Republicans administrations and was a senior aid to President George W. Bush in the Whitehouse.
Peter, you`ve been trying to convince your Republican friends for a year now that video lives forever. And what Donald Trump says and what they have said about Donald Trump will live forever. And they may have to pay that price at some point.
PETER WEHNER, SENIOR FELLOW, THE ETHICS AND PUBLIC POLICY CENTER: Yes, frankly, I think they should pay a price for it because I don`t think this is just any other election. This is not in my estimation just kind of credential judgment of two candidates.
I think to vote for Donald Trump is an intellectual and moral mistake of a massive proportions. And I am a conservative and I believe in accountability. And I think that probably will be some for it.
I can`t argue with that critique. I mean he is a racist. He is nativist. He is reckless. I do think he has a personality disorder, and my party, the Republican Party has lined up behind him, and that matters.
O`DONNELL: Have you had conversations with Republicans who have done this, have lined up behind him. And people in the Paul Ryan school of this, where you have found a zone of sympathy with the predicament you have found themselves?
WEHNER: I have. I have. But actually been in touch with a fair number of Pro-Trump, people, people friends of mine and in public office. And it`s - - there`s a spectrum frankly as somebody like Paul Ryan here I`m speaking of what Ryan has said on the public, not based on private conversations.
He`s obviously uncomfortable with him. And I think Paul`s argument is it would be better for the Republic if it were Trump rather than Hillary Clinton. But he`s not wild about that. Then there are other people who are quite enthusiastic about Trump.
I understand the former argument, you know, somewhat better. I disagree with it strongly. But I understand it`s the enthusiastic support for Trump that frankly I just don`t get, especially from people on the right who have spent their career on the opposite side of so many issues that Donald Trump is on. And now all of a sudden, it is as if whatever he says is right. And they jettison those convictions and those beliefs.
And of all -- there`s so many bad things about that. But one of the things it does is it makes people more cynical about politics. And there`s way in that cynicism in politics. We don`t need more to be added to it. But Trump is doing that and his supporters are adding to it.
O`DONNELL: Speaking of cynicism, aren`t all those Republicans that want to run again hoping that Hillary Clinton wins so they can run again in four years?
WEHNER: I would think so. I would even think they would hope that she wins because deep down they know she would be the less reckless choice. But, yes, I -- my guess is that they would assume that she would be a one- term president. That`s impossible to know at this point.
But if were you to speculate, that`s not an unreasonable judgment. And of course if Donald Trump is President of the Party -- is President, the damage that he does to the party is going to be even beyond what it is now. It`s bad enough to have him as a nominee.
Trust me, but if he were the President, he would redefine the party, so fundamentally and so durably that I`m not sure how the Republican Party would get out of that hole. I`m not quite sure how they`re going to get out of this hole.
O`DONNELL: We`re out of time. Peter Wehner, thank you very so much for joining us tonight. Really appreciate it.
WEHNER: Thank you.
O`DONNELL: We`ll be right back.
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UNIDENTIFIED MALE: And it all culminated in this amazing assertion.
TRUMP: I think my strongest asset maybe by far is my temperament. I have a winning temperament. I know how to win.
UNIDENTIFIED MALE: That is an incredible statement. If you had looked into the camera and said, I am a small Korean woman, it would have been more believable. And for the record you can`t incoherently rant about having the best temperament.
That is a claim that disproves itself. It`s like getting a forehead tattoo that says I have excellent judgment.
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O`DONNELL: MSNBC`s live coverage continues now. The 11th Hour with Brian Williams is live and it is next.
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