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The Last Word w/ Lawrence O'Donnell, Transcript 7/21/17 Trump family paranoia

Guests: John McLaughlin, Max Boot, David Corn, Matt Miller, David Cay Johnston, Joyce Vance, Evelyn Farkas

Show: THE LAST WORD WITH LAWRENCE O`DONNELL Date: July 21, 2017 Guest: John McLaughlin, Max Boot, David Corn, Matt Miller, David Cay Johnston, Joyce Vance, Evelyn Farkas

RACHEL MADDOW, MSNBC HOST: That does it for us tonight. We will see you again on Monday. Now it`s time for "THE LAST WORD." Ari Melber sitting in for Lawrence tonight.

Good evening, Ari.

ARI MELBER, MSNBC HOST: Good evening, Rachel. You know, sometimes the news breaks late and people ask why, and there`s no reason. And then sometimes it feels like maybe there`s a reason.

MADDOW: That`s right. And, you know, some of these things, I just feel like it`s because we`re all cursed and we don`t get -- we don`t get real weekends.

MELBER: Right.

MADDOW: And so Fridays just end up being a busy day. But there are some things on the news tonight that feel like legit, deliberate Friday night news dumps that are supposed to be burying these things.

MELBER: Right. And your reporting on what outgoing former director -- former Director Shaub said adds context to that. I wish you a very good weekend.

MADDOW: Thank you, All right. You too, my friend.

MELBER: Thank you.

I am Ari Melber in for Lawrence O`Donnell this evening.

It seems Attorney General Jeff Sessions` week did go from bad to worse. We have this breaking news tonight among several stories, first from "The Washington Post," that current and former U.S. officials are saying U.S. spy agencies intercepted these conversations of Russia`s former ambassador to Washington, Sergey Kislyak.

And the source saying, Kislyak told his superiors in Moscow that he did discuss campaign-related matters, including specifically policy issues that are important to Moscow with, yes, Jeff Sessions, smack dab in the middle of the ongoing 2016 campaign. Now the "Post" cites a U.S. official who says this means Jeff Sessions was misleading the public.


JEFF SESSIONS, ATTORNEY GENERAL: I never had meetings with Russian operatives or Russian intermediaries about the Trump campaign. And the idea that I was part of a, quote, "continuing exchange of information" during the campaign between Trump surrogates and intermediaries for the Russian government is totally false.


MELBER: And, quote, "A former official said the intelligence indicates Sessions and Kislyak had substantive discussions on matters including Trump`s positions on Russia-related issues and prospects for U.S.-Russia relations in a Trump administration."

Now "The Post" makes an important point that we all obviously have to keep in mind here. The officials acknowledge that the Russian ambassador could have mischaracterized, exaggerated, even made up some of the nature of these interactions. The Russians obviously may have their own motivations in how they discuss these meetings, even on their private lines.

As for these anonymous U.S. officials, we just don`t know at this hour and "The Post" doesn`t say whether their sources there were trying to, say, blow the whistle on potential misconduct by Jeff Sessions or others, or if the sources are pro-Trump, trying to hurt Jeff Sessions in the very same week President Trump criticized him with the kind of language that really, in any other administration, would be a prelude to dismissal.

We do know the president says he`s unhappy with Jeff Sessions. And according to the president, think about it. The reason is not immigration enforcement, which was the biggest DOJ focus in Trump`s campaign. The reason that Trump is unhappy with Sessions has nothing to do with cracking down on gangs or drugs or mortgage fraud or really anything related to the attorney general`s vast powers and influence over the lives of everyday Americans.

No, according to the president`s own words, the big reason he is losing confidence in Jeff Sessions is all about the attorney general`s impact on Donald Trump himself.

Let`s get right to this big story tonight. I`m joined by John McLaughlin, former acting director of the CIA and MSNBC analyst, Max Boot, a senior fellow for National Security Studies at the Council on Foreign Relations, and an adviser to Mitt Romney back in 2012, and also reporter David Corn, Washington bureau chief for "Mother Jones" and analyst as well.

Mr. McLaughlin, the intercepts that are described in "The Washington Post" story, what do they mean to you and how much more would you like to know about them?

JOHN MCLAUGHLIN, FORMER CIA ACTING DIRECT: Well, Ari, to be frank, I mean if this came to me in my old job, if someone walked into my office and told me this story, the first question I`d have would be I want to see the intercept. In other words, I would like to know all of the details in it and make some judgment about the way it`s characterized and so forth.

And obviously if there`s truth to it, it`s appropriate to think about -- smart to think about whose agenda is being served here, and I think you`ve already talked a little bit about the possibilities there. But yes, the final thought I would give you on what it means to me is if this is true, it`s obviously very sensitive intelligence. So someone throwing it out has to have an agenda that`s pretty important to them.

[22:05:09] MELBER: Max, do you see the same potential agendas?

MAX BOOT, COUNCIL ON FOREIGN RELATIONS: Absolutely. I mean to me, this is a little bit like choosing between Iran and Iraq during the Iran-Iraq war because you have Donald Trump versus his own attorney general and neither one inspires a lot of confidence. And certainly it`s huge news if this "Washington Post" story is accurate that Jeff Sessions had discussions with the Russians about the campaign and then lied about it, including possibly perjuring himself before the Senate.

But then you have to wonder, as John McLaughlin just said, why is this coming out? And there`s a lot of speculation that is being leaked by the White House because just a couple of days ago Donald Trump unloaded on his own attorney general, and there`s a lot of speculation that he`s trying to force Jeff Sessions out so he can appoint somebody else who will fire Bob Mueller for him.

And so bad as Sessions` conduct may be, it may actually be in the interest of the republic for him to stay where he is so that Trump can`t put a yes man in that position.

MELBER: Well, and David, you know, sometimes we ask big, complicated questions. I have a very simple question for you building on the comments here of our colleagues. How could it be that there is no Russia collusion or Russia problem according to Donald Trump, but the one reason he would fire or be unhappy with Jeff Sessions is a meeting with a Russian ambassador that the president himself still maintains is of no significance?

DAVID CORN, MOTHER JONES: You know, I cannot answer any question about what Donald Trump thinks. You know, he is highly situational. What he says, I think, is only meant to stand for the nanosecond he says it. It doesn`t matter whether it`s logical, consistent with anything else he`s ever said.

To me, you know, a big way of looking at what`s coming out tonight, assuming "The Washington Post" report is accurate, is that why does this matter so much? Well, what matters is if you have really one of the top surrogates for Donald Trump, you know, you know, in the spring of 2016 talking to the Russians kind of as they`re beginning to figure out how to do information warfare against the U.S. election to help Trump and to hurt Hillary Clinton, but if he`s telling the Russians, you know, if we get elected, you`ll get a better deal with us.

We want to revisit sanctions. You know, Donald Trump likes Putin, wants to sit down and talk to him about doing things differently. If that message is being conveyed by Jeff Sessions to the ambassador from Russia, he is giving Putin incentive and motivation for going ahead with this far-ranging information campaign, warfare campaign, that included the hacks and the release of e-mails but went much further than that.

He is helping the Russians by letting them know that if they do this, there may be a big payoff for them in the end.

MELBER: And David, the president complains about leaks a lot. He doesn`t seem to be complaining yet tonight about this leak.

CORN: Well, we`ll see what tweet comes out at 5:00 in the morning, 6:00 in the morning. I mean he complains about anonymous sources yet he goes off the record, you know, with "The New York Times" himself and of course White House people go off the record all the time.

So, you know, the way this White House leaks, we may know by the time this show is over who is behind the leak. But it`s even amazing that we`re thinking for a moment that a president might be leaking information that hurts his attorney general and makes his own campaign look bad just to get rid of the guy because he didn`t recuse himself.

MELBER: Max Boot, the flip side of all this would be absent a Russia problem and absent what may be misleading testimony, the underlying meeting itself, even if they did discuss policy in the potential Trump administration, is that problematic, too?

BOOT: Well, I think taken in isolation, if this had been, you know, a number of Romney campaign meeting with the Russian ambassador and assuming he didn`t lie about it afterwards, it could be perfectly proper. But you have to take it in a larger context. And remember that this is not even necessarily the biggest news story of the week. Remember, the week began with news that Donald Trump had a, quote-unquote, "secret meeting" at the Hamburg G-20 summit with Vladimir Putin where they talked about, quote- unquote, "adoptions," which is code words for sanctions.

And then shortly thereafter, Trump ended U.S. aid to the moderate Syrian rebels, which is a key demand that the Russians have been making for a long time. And of course we`re also every single day learning more about this meeting that occurred in 2016 between Donald Trump Jr. and the rest of the Trump campaign hierarchy and these Russian representatives, including the fact that we`ve learned today that the lawyer who was involved there on the Russian side represents the FSB, the Russian intelligence service.

So if you put all this into the context and you see all of these Russian connections, there`s a new one every single day, and increasingly benign explanations for what the Trump -- for what they`re up to, benign explanations are just not incredible.

[22:10:11] MELBER: Right. I mean, you mentioned the disclosures on the meeting alone and how outnumbered the Trump folks were with these Russian officials.

BOOT: Right. Yes. Right.

MELBER: John McLaughlin, here was Jeff Sessions -- I would say the crescendo of his testimony when he clearly decided to try to lay down a gauntlet and appeal to his former colleagues in the Senate with the idea that he couldn`t possibly have done something wrong on Russia.


SESSIONS: The suggestion that I participated in any collusion that I was aware of any collusion with the Russian government to hurt this country, which I have served with honor for 35 years, or to undermine the integrity of our democratic process is an appalling and detestable lie.


MELBER: John McLaughlin, as someone who has sifted evidence your whole life, at this hour, is it still operative that kind of blanket denial from him or do you see anything in public here that casts doubt on that?

MCLAUGHLIN: Well, if there`s truth to this report we`ve just been talking about, everything that Jeff Sessions said doesn`t stand. And he says it in such an affirmative way that it`s been a long time since I`ve seen such a stark contrast between the statements of a public official and what in this case may be true in this "Washington Post" article. I`m certain in any event that there`s a core of truth to it.

So I think it casts considerable doubt on Jeff Sessions` staying power in this position. I think that`s probably the next shoe that we`ll see drop here will be some discussion of whether he should stay or leave. So once again we see intelligence -- this is a common theme in this administration throughout its six months so far, is that intelligence is used by various factions in the administration as a political weapon.

Whether we`re talking about leaks from the Hill or leaks from within the White House, just another example, I think, of what is evidently a chaotic situation in which they do not yet have across the board the kind of team work established that`s required to really move our government and our interests forward.

MELBER: And Mr. McLaughlin --

MCLAUGHLIN: Kind of appalling from all of those points of view.

MELBER: How would you -- if you were back in your role running the CIA, how would you deal with something like this? Is there any effort to get the intercept if not out to the public, to the gang of eight or to some respectable process body that can look at it, or does that just make a bad problem worse?

MCLAUGHLIN: Well, the first thing, of course, is you would probably know who had this intercept if it`s an intercept as described. You would know who had received it, and you would be running down your list of potential sources for the leak. If someone in the Congress had not seen it -- and this may have been a restricted document -- this may have been an extremely sensitive document that not many people will have seen.

So you would almost certainly be getting calls from your two oversight committees for the document and any background information on it. You`d be briefing it. You`d be answering questions about it. You would be talking -- you would be -- as I said right at the outset, the first thing I would do is say, let me see that document if it appeared in the press like this, if I hadn`t seen it up to that point.

And I would want to look at it from the standpoint of what are the motives of Kislyak here. I met him quite often when he was head of Americas Department in the Russian Foreign Ministry. And he was capable of embellishing to Americans but I don`t think he does that with his superiors. He`s actually a rather professional guy speaking just from a -- you know, an espionage point of view.

And also I would say a really outside possibility here, just to put every conceivable idea on the table, is that the Russians could send something like this through with the -- in a form that they expect it to be intercepted.

MELBER: Right.

MCLAUGHLIN: Just as part of their covert action operation to throw more chaos into our system, which they`ve succeeded in doing.


MCLAUGHLIN: I wouldn`t rule that out completely.

MELBER: I appreciate your point. I think that`s very much on the table of possibilities given the recent conduct and how much work they`ve done to sow chaos. We know that parts of the misinformation campaign were just to create some kind of confusion, which is different than other parts that were designed to explicitly reach strategic objectives like blunt any momentum of Hillary Clinton. We`ve seen both patterns in the intel community and your former colleagues have spoken to that.

David Corn, I want to read the denial here from Sessions` spokesperson, which also seems to have a problem in it.

[22:15:02] But here it is. Quote, "I obviously cannot comment on the reliability of what anonymous sources describe in a wholly uncorroborated intelligence intercept that `The Washington Post` has not seen and has not been provided to me. But the attorney general stands by his testimony from just last month before the Senate Intel Committee when he specifically addressed this and said that he never met with or had any conversation with any Russians or any foreign officials concerning any type of interference with any campaign or election."

David --

CORN: I -- can we play can you spot the problem?

MELBER: Well, I was going to say, number one, in fairness, it is true we don`t have the intercept so there`s a fair point I think they make.

CORN: Yes.

MELBER: Then the problem, as I see it, and tell me what you think, is she`s zeroing in here on a quote regarding only meddling.

CORN: Yes. Yes.

MELBER: Which is not actually a denial to the rest of the piece. Go ahead.

CORN: Well, this is a quite common device used in Washington and elsewhere, which is you deny the charge that isn`t really made. You know, he never talked to the Russians about collusion or meddling. That`s not what this intercept, you know, says according to "The Washington Post" report.

It says that he talked to Kislyak about the Trump campaign and policy positions that Trump would presumably adopt should he become president. And he had specifically denied that any of his contacts with Kislyak, which first he denied totally happened, but then when he conceded there were contacts, he said it had nothing to do with the campaign. It was just maybe in his senatorial role and he exchanged pleasantries, but nothing about the campaign.

So that -- you know, it`s not hard to come up with the essence of the charge here and deny it straight on. They chose not to do that.

MELBER: Absolutely. John McLaughlin, thank you. Other folks, stay with me.

And coming up, President Trump has said to be especially irritated if Special Counsel Mueller should investigate the president`s business dealings. How far is President Trump willing to go to potentially interfere? That`s ahead.

And some White House aides say they`re stunned Attorney General Sessions hasn`t already resigned. We`ll explain next.


SESSIONS: We in this Department of Justice will continue every single day to work hard to serve the national interest and we wholeheartedly join in the priorities of President Trump. He gave us several directives. One is to dismantle Internet transnational criminal organizations. That`s what we`re announcing today. A dismantling of the largest dark Web site in the world by far. I congratulate our people for that.

I have the honor of serving as attorney general. It`s something that goes beyond any thought I would have ever had for myself. We love this job. We love this department, and I plan to continue to do so as long as that is appropriate."



[22:20:32] MELBER: Welcome back. We have more on this Friday night breaking news. "The Washington Post" reporting that according to a U.S. intelligence intercept, then Russian Ambassador Kislyak reported to Moscow that he and Jeff Sessions did indeed discuss the Trump campaign and Trump`s position on policy matters that were important to Russia in two conversations.

This is a reference to that conversation at the Mayflower Hotel on April 2016 and the other at the RNC convention after the Russian effort to influence the U.S. election for Donald Trump was indeed under way.

And all of this comes, of course, with some context. Donald Trump lashing out at the man at the center of this article, Jeff Sessions, over what? Well, over the recusal from the Russia inquiry and that very odd "New York Times" interview, Donald Trump did not apparently clear it with his legal team.

And then there was Thursday`s remarkable report in "The Washington Post" that Donald Trump has been asking about his presidential power to pardon his staff, family, and even himself. "The Post" reporting, Trump has been fuming about the probe in recent weeks as he has been informed about the legal questions that he and his family could face. He`s told aides he was especially disturbed after learning Mueller would be able to access several years of his tax returns.

The focus on the president`s family comes in the wake of Donald Trump Jr.`s confirmation that he had that meeting in 2016 with Jared Kushner, Paul Manafort, a Kremlin linked lawyer who promised dirt on Hillary Clinton.

Kushner has now agreed as well to be interviewed by the staff of the Senate Intelligence Committee. This is going to happen on Monday and then right over to the House Intelligence Committee the next day, Tuesday.

Donald Trump Jr. and Paul Manafort are also working with the Judiciary Committee to be interviewed, at least behind closed doors.

All of this is in the front. This is the important stuff. Then you have the other stuff, this shake-up in the West Wing on who is going to speak for the White House. Sean Spicer resigning and Anthony Scaramucci, a Wall Street financier who`s close to the Trump children, taking over today as communications director.


ANTHONY SCARAMUCCI, TRUMP WHITE HOUSE COMMUNICATIONS DIRECTOR: I`m close personal friends with Jay Sekulow. I have a relationship with John Dowd. And I`m going to work with Don McGahn and other people just to make sure that we`re on message and we`re handling ourselves in the most appropriate way possible.

I haven`t been briefed yet by the White House counsel about what is appropriate to talk about from this podium. So therefore I don`t want to take any questions related to Russia.


MELBER: That shakeup comes just a week after Politico reported that a source close to Kushner said that while he doesn`t have an exact plan for an overall Russia response, he`s been angry there wasn`t a more robust effort from the communications team. An outside adviser said Spicer has publicly griped about the demands from Kushner.

Joining us now is Matt Miller, a former spokesman for Attorney General Eric Holder and an MSNBC contributor, and David Corn is back with us.

And Matt Miller, as a spokesperson, I mean, you know professional disrespect when I say that pay no attention to the man in front of the curtain because the big substantive story here does not seems to be who is giving out the talking points but rather whether this is a White House that is moving towards the compliance that some of President Trump`s criminal defense lawyers say they`re offering the special counsel, or as the president himself seems to be saying in that "New York Times" interview, and in potentially other actions, moving to undermine the investigation. Your view?

MATT MILLER, FORMER SPOKESPERSON FOR ERIC HOLDER: Well, I think you`re absolutely right. I think one of the things we`ve learned about this White House now six months into this administration is that you can`t trust what the spokespeople come out and say from the podium. You have to look at what Donald Trump does and sometimes what Donald Trump says. And he made very clear this week that the most important thing to him is stopping this investigation.

He`s angry at his attorney general because his attorney general recused himself and the only reason you would be angry about that is if you somehow expected him, if he wasn`t recused, to quash the investigation. He`s threatening Bob Mueller, you know, if he moves into his finances, which of course he`s going to have to do to conduct a real, thorough investigation.

MELBER: Right.

MILLER: I think, you know, it`s the president we have to watch here, what he says and what he does behind closed doors.

MELBER: And Matt --

MILLER: That`s when you judge what`s happening.

MELBER: When you were at DOJ, I`m sure there were times where you have the president and the attorney general have words, communication, signals about the policies they want and how things are going.

Do you ever recall in your tenure of time where the president publicly voiced displeasure not on that score but simply on how the attorney general`s conduct personally affected the president?

MILLER: Absolutely not. There are times they had policy disagreements and sometimes those policy disagreements even became public, but what Donald Trump did was a full frontal attack not just on Jeff Sessions. There are people -- you know, people in Washington get so caught up in personalities. It was an attack on the independence of the Justice Department.

And I think one of the most disappointing things Jeff Sessions has done is when he came out and held that press conference yesterday on an unrelated topic, he didn`t stand up for the department. He didn`t stand up for the department`s independence, he didn`t stand up for the special counsel. He just kind of took a pass and laid down and took it from the president. And if you`re the men and women working at the department, that is an incredibly demoralizing thing to see the supposed leader of the department do when the very -- when the entire agency is under attack from the head of the executive branch.

MELBER: David, put that in the context of the discussions of pardon because a pardon has one prerequisite and that is that a crime occurred.

CORN: Exactly. And so the fact that he`s talking about pardons to his aides, for himself, for his family members, I mean it certainly indicates to me that he believes that Bob Mueller poses a threat. And not that Bob Mueller is going to write an op-ed column or that he`s going to rally the Republican base against Republicans and against Trump.

No. He poses a threat because he`s looking at issues that might become criminal. I mean, a lot of us on the outside have been reporting on this without knowing whether or not crimes have been broken. You know, we see, and you`ve talked about this, the theoretical possibility depending on the facts that come out. But Donald Trump is behaving as if he knows there`s a real criminal risk here.

MELBER: Right.

CORN: And one thing we do know, when it comes to people like Bob Mueller, we saw this with Patrick Fitzgerald in the Scooter Libby case. These folks tend to err on the side of not making things political and not indicting government officials close to the president unless they really feel they have a strong case.

MELBER: Right. No, they`re pretty careful. I mean, look, David --

CORN: You know, Fitzgerald did not indict Karl Rove even though some of his FBI agents wanted him to.

MELBER: Yes. They`re pretty careful. And you mentioned the op-ed. And I have to tell you, a strongly worded op-ed can shake Washington to its core. So you and I may disagree about the power of the pen there.

But, Matt Miller, before I let you go, I got to read to you Senator Mark Warner basically says, "Pardoning individuals who may have been involved in this would be crossing a fundamental line." He`s obviously trying to draw a line, and it is possible to abuse the pardon power, but does that to you strike you as potentially an overstatement when this is a power the president has to use?

MILLER: You know, it`s a power he has to use but he can`t use it inappropriately. And I think what he was doing with that interview, you know, when he attacked Mueller and what he was doing, what these leaks of the pardon of him, contemplating the pardon power are doing is testing the boundaries of what he can get away with. You know, firing Jim Comey should have been a red line. That`s the kind of thing that typically firing an FBI director investigating you is a red line and he go the away with it.

I think what he was doing -- what he`s doing through these leaks is testing when are Republicans in Congress -- when are they going to stand up and say no, and say this is an impeachable offense? And we`ve heard a lot of silence since that pardon leak floated yesterday. And if you`re the president, you`re watching that silence and wondering, maybe I can get away with this, too.

I think, you know, if he`s going to be stopped, people are going to have to speak out before he does it, not afterwards.

MELBER: Right. And to your point, it is bizarre for someone to say, let me explore self-pardoning because that`s like publicly ruminating on whether you might have committed a crime.

MILLER: Right.

MELBER: Now it could be a lack of understanding. That`s always the other possibility. But either way, it`s bizarre.

Matt Miller and David Corn, thank you so much.

CORN: Thank you.

MILLER: Thank you.

MELBER: Coming up next, Jared Kushner revising yet another government disclosure form, this time about finances. And the president does not want Robert Mueller looking, as were just discussing, into the business dealings, but the president doesn`t actually have a choice on it. That`s next.


[22:32:23] MELBER: Welcome back. President Trump`s son-in-law, Jared Kushner, has revealed he inadvertently omitted 77 assets from his personal financial discloser form filed into Office of Government Ethics. The previously undisclosed assets were revealed in this revised financial disclosure. This came out tonight, Rachel was mentioning at the end of her show. And it was first reported publicly by "The Wall Street Journal."

Now, in isolation, updating a form like this is not that big a deal. But this is not an isolation, and with Jared Kushner, it is fitting a larger pattern. The "Journal" reporting back in May that he did not disclose his business relationships with Goldman Sachs or billionaires George Soros, a major Democratic donor, or billionaire Peter Thiel, a major Trump associate and donor. That was all in the first round financial disclosure.

Then in June "The Post" reported Kushner did not disclose a $285 million loan from Deutsche Bank that he received when, oh, just before Election Day. And then a report in "The New York Times" that Kushner supplemented the list of foreign contacts on his security clearance form three times, adding a total of 100 more names.

I`m not done. This week, NBC News learned that Robert Mueller is gathering the financial records which we don`t know but could include all of these kinds of records, and the business dealings of people close to the Trump campaign.

Bloomberg reports Mueller`s looking into the business dealings of Trump himself, something that Trump basically says this week he believes would cross a red line.


UNIDENTIFIED REPORTER: If Mueller was looking at your finances and your family`s finances unrelated to Russia, is that a red line?

UNIDENTIFIED REPORTER: Would that be a breach of what his actual charge is?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I would say yes. I would say yes.


MELBER: Joining me now is David Cay Johnston, Pulitzer Prize winning journalist, who founded which is a nonprofit news organization focused on the Trump administration. He also wrote the book, "The Making of Donald Trump."

I`m also joined by Joyce Vance, a former U.S. attorney for the northern district of Alabama. As a prosecutor, she has dealt with many evidentiary requests.

Staring with you, David Cay Johnston, on Kushner and then wherever else you want to go. Your view of whether this is a significant or in any way concerning update?

DAVID CAY JOHNSTON, FOUNDER, DCREPORT.ORG: Well, pattern is exactly the right word. You know, if you have very large, complicated finances, and you forgot that next door to an apartment building you own, you bought a house so you wouldn`t get complaints from the owner there anymore, it`s OK, fine. We understand that. Or a brokerage account you forgot you had somewhere.

This is way, way too much. And it is again and again it`s meetings. It`s money. This is clearly indicative of bad behavior.

MELBER: Joyce, how do prosecutors look over these kind of records? And why is it important to an investigation?

[22:35:08] JOYCE VANCE, FORMER ATTORNEY, ALABAMA: Well, these patterns that we`re seeing and this cumulative failure to disclose piece after piece of information will start to give prosecutors some sense of whether witnesses and other people that they`re looking at in this investigation are being truthful with them. And so when you see one small mistake or even a few small mistakes in the middle of a large portfolio, that`s not as troubling as this ongoing pattern that I think will be very illustrative of the type of information Mueller is looking to extract from financial records.

MELBER: When you do an investigation, you have sometimes what`s considered contraband, something that`s automatically bad if somebody`s got it. And then you have other evidence that could be good or bad depending on what happens. Consider what Don Trump Jr. said publicly way back in 2008, a different context or maybe he wished he wouldn`t have said it. Quote, "Russians make up a pretty disproportionate cross section of a lot of our assets. We see a lot of money pouring in from Russia."

But, Joyce, the special counsel is not going to treat just those assets as automatically bad or potentially criminal, right? It has to be finding those records plus what else?

VANCE: So I think that that`s an important point. People shouldn`t be quick to rush to judgment and condemn the behavior that they see here. Your tax records will give a picture of who you deal with and what kind of dealings you have, and many of those business dealings may be legitimate.

There`s also the possibility that some of these business dealings, even those that occurred decades ago, may begin to put together a story and lay a backdrop for events that occurred more recently. So prosecutors will look through that entire network of transactions.

I`m not very impressed by these complaints that special counsel is beyond the scope of his mandate. He really needs to get this full picture and put into context more recent events.

MELBER: David, the other line here in that "Washington Post" report that hits your expertise, Trump has told aides he was especially disturbed after learning Mueller would be able to access several years of his tax returns.

You know, David, there`s talk on some college campuses about trigger warnings and something really disturbing, you have to be warned about before you hear about it. Why does it seem, at least according to "The Washington Post" report, quoting Trump`s own aides, that his tax returns require some kind of trigger warning?

JOHNSTON: Well, this is because Donald`s real vulnerability has always been his financial transactions, whether there`s money laundering involved, whether he`s been compromised, whether he was overpaid for properties when he was in trouble as part of an effort by the Russians to make sure he would be their friend. And this has been his deep concern from day one about his finances.

And remember, the tax return is the beginning point of an inquiry. It`s the books and records behind the tax return that will be really valuable. And by the way, back in May when Mueller was appointed, one of the things I predicted was that we would see Trump complain that Mueller was stepping outside his authority, and I felt the charter should have been more broadly drawn by Rosenstein at the time so we wouldn`t face this issue.

MELBER: David Cay Johnston and Joyce Vance, appreciate it, both of you.

Coming up, this NBC exclusive interview. If you haven`t seen this, when we first got it in our newsroom this morning, this is amazing. Russian ambassador Sergey Lavrov proving why it is so hard to get a straight answer about anything involving the Putin-Trump relationship. You`ve got to see it. This is next.


[22:42:19] MELBER: Tonight we are learning what Russian ambassador Sergey Kislyak allegedly told senior Russian officials about his conversations with Attorney General Jeff Sessions. This morning meanwhile we were learning about another Russian official`s take on American politics.

This was an exclusive interview with NBC`s Keir Simmons. Russian Foreign Minister Sergey Lavrov talking about how many times President Trump and Vladimir Putin really met during the G-20.


KEIR SIMMONS, NBC NEWS CORRESPONDENT: We know about President Putin and President Trump meeting three times at the G-20. They met obviously for the bilateral. They met at the dinner. And they met --

SERGEY LAVROV, RUSSIAN FOREIGN MINISTER: Well, maybe they went to the toilet together. That was a fourth time.


MELBER: Maybe they went to the toilet together. That is how the Kremlin lets you know they do not respect the question you`re asking or, more importantly, these issues. And in this exchange, Lavrov continues his combative tone by suggesting the undisclosed meetings were really no different than children waiting in a hallway.


LAVROV: When you are brought by your parents to a kindergarten, do you mix with the people who are waiting in the same room to start going to a classroom?

SIMMONS: It`s the G-20, though, not a kindergarten.

LAVROV: Well, but there is also a room where they get together before an event starts. They cannot arrive all at the same time on the bus. They arrive with their own motorcades and then they are ushered in the room, which is a waiting room. So they might have met even much more than just three times.


MELBER: Much more than three times. You can see the theme here. If Lavrov seems smug about this whole line of inquiry, maybe that`s because Russia got what it wanted. As for the U.S., the AP is reporting that this whole dinner conversation raised red flags with advisers already concerned by the president`s tendency to shun protocol and press ahead of outreach towards Russia.

The same report going on to say that National Security Adviser General H.R. McMaster was warned that Putin`s not to be trusted. Sergey Lavrov gave his version of what he says happened when President Trump brought up Russian election hacking during the official meeting.


LAVROV: President Trump raised the issue. President Putin confirmed that we never did anything to interfere in the American elections and that he, President Putin, got an impression that President Trump accepted this explanation. He never -- Putin never said that Trump was happy about something he said on this.


MELBER: The issue, of course, is not whether the people in this meeting were happy or even sad. The issue of course that continues to hang over the Trump administration regardless of the ultimate outcome of these domestic investigations, regardless of any culpability that may or may not exist inside America, is the larger national security question of whether Russia will get away with what U.S. intelligence agencies say was meddling and what some observers have likened to cyber war.

[22:45:19] Are we at the end or the beginning of dealing with that interference?

Evelyn Farkas and Max Boot tackle the problem with me next.



LAVROV: Why nobody got suspicious of the fact that actually the entire unit Putin spent with Madame Trump, with the first lady, because the German hosts arranged the table that way. And then after the dinner was over -- I was not there. President Trump apparently went up to pick up his wife, and spent some minutes with President Putin. So what?


MELBER: So what? I`m now joined by Evelyn Farkas, a senior fellow at the Atlantic Council and a former deputy assistant secretary of Defense responsible for Russia policy. She`s also an MSNBC national security analyst. And foreign policy expert Max Boot back with us.

Evelyn, tell us about the Russian officials you`ve worked with and what prism that gives you on what we`re seeing in this interview.

EVELYN FARKAS, SENIOR FELLOW, ATLANTIC COUNCIL: Yes. Yes, Ari, well, I did work a little bit with a -- I met Foreign Minister Lavrov in my three years that I worked in the Pentagon for three different secretaries of State. Of course I met the minister of Defense and the deputy ministers of Defense.

[22:50:06] This was a quintessential opportunity that Lavrov did not waste to basically mess with America. And he did it on three counts. I mean, first of all, he started to muddy the waters. How many times did they actually meet? How many meetings did they have? Did they stand at the urinal and, you know, talk for 20 minutes about substantive issues? We don`t know.

Number two, you know, he said, oh, President Trump accepted President Putin`s denial of the meddling in our elections. Again we don`t have a definitive authoritative read-out of that meeting so we don`t know. It`s one man`s word against another, I guess, or one government`s word against another.

And then the third thing is I don`t know if you guys caught this but throughout the interview he was disparaging the news media and the intelligence community, using themes actually that we hear a lot here in U.S. So it was really disturbing on many levels but it wasn`t surprising.

MELBER: Yes, Evelyn, I mean, you nail it there that there are these striking overlaps. And, you know, we all know the term talking points in domestic politics. But it seems like Russia has the appearance of providing the talking the points to sort of thread a needle on meddling because Trump himself prior to the interview we just aired last week had basically said, oh, well, I don`t think Putin said -- I said I accepted it. There`s a difference. He said that he -- you know, he thought it. They`ve sort of seem to both be landing on that gray zone. Is that what you`re hearing?

FARKAS: Maybe, but I`m also hearing, Ari, that, you know, they`re hinting that they can control the narrative if they want to. Maybe they can blackmail our president. Maybe they can convince our public, you know, that they`re right. Unfortunately you know some Americans don`t understand the full threat and intent that this government in the Kremlin poses.


BOOT: Well, I think, Ari, the larger picture is that we have a president who acts when he meets the Russian president like a giddy school girl meeting, you know, Brad Pitt or Zach Efron. I mean, he says it`s an honor to meet you. Rex Tillerson talks about what a great chemistry they have. He spends an undisclosed amount of time one-on-one with Putin at this dinner with no other Americans present.

I mean, in and of itself this would make you kind of wonder what the heck is going on. But when we see this whole history of allegations of collusion between the Trump campaign and the Russians in the last election and we now have solid evidence of that collusion in that meeting that Trump Jr. had, and then you see the way that Trump is now kowtowing to Putin. Just think about what happened at this Hamburg summit where, you know, when Sergey Lavrov is not generally credible but I actually accept what he`s saying that Trump more or less accepted Putin`s denials of Russian involvement in the cyber attack because if Trump didn`t accept that he could come out and say so, but he hasn`t said so.

He hasn`t said I believe that Russia is solely responsible just as the intelligence community of the United States says. He hasn`t said that. So his silence basically suggests that Lavrov is right that basically he did not -- Trump did not press that hard on this Russian attack on America. And we know that after this meeting he cut off the Syrian rebels.

MELBER: Right.

BOOT: Which is a big ask that the Russians have wanted for a long time. He agreed to a ceasefire in a small part of Syria that Israeli objects to because it`s entrenching Iranian and Russian control in that area. And the most farcical of all is that Trump and Putin agreed on the so-called cyber hacking task force between Russia and the United States which is, you know, the fox guarding the henhouse. And Trump seemed to disown it but just a day ago you had a Russian official saying that that`s still very much a live issue so, you know --

MELBER: Right. And the half life for that tweet was three hours.

BOOT: Yes.

MELBER: I want to get Evelyn back in before we ran out of time.

BOOT: Right. Right.

MELBER: Evelyn, Max makes a domestic political point which is it would actually be easier for President Trump to talk tough on Russia but he won`t even do that with regard to the meddling.

FARKAS: Right, right. And I think, you know, tells us for some reason he is obviously enamored with President Putin but he`s also afraid to go -- to be too tough. And the Syrian concession I think is pretty serious. I mean, I spent the day here, you know, with MSNBC at the security conference, and we heard senior former officials, former CIA director, former DNI, talk about the fact that withholding that assistance to the Syrian rebels, those who are moderates, is actually going to create more terrorists.

So it`s not in America`s interests. And this seemed like -- if it was a secret deal it must be a secret because we haven`t heard the president in the White House come out and explain this to the American people.

MELBER: Wow. It`s -- it`s a lot to chew on. Love to talk to you all about it again.

Evelyn Farkas and Max Boot, I want to thank you.

I have a little announcement to make. It is part of tonight`s LAST WORD. And that`s next.



[22:58:36] LAWRENCE O`DONNELL, MSNBC HOST: Ari, listen. I am here to say thank you. You`ve done an incredible job over these nine weeks. That`s not just me talking. That`s everybody on my Twitter feed. That`s everybody who`s been watching the show. I could not be more grateful to you to let me do this, to take this time to get ready to come back.

You`ve been incredible.


MELBER: That was a surprise at the time. Lawrence O`Donnell popping up on the show. This was back when I was filling in for him while he was recovering from a car accident three years ago.

Lawrence said he was grateful to me at the time. Let me say I am grateful to him and the whole LAST WORD team because I obviously spent more time learning how to anchor here than on any other show. And with that in mind I`m excited to officially announce my new nightly show, "THE BEAT," which premieres this coming Monday night at 6:00 p.m. Eastern.

"THE BEAT WITH ARI MELBER." Now I will need plenty of help from viewers so I hope you will tune in and I`ll need plenty of advice.

I do still have to pick out my tie for that first show. I am thinking I got -- thinking of this one. Could we get a close-up of that? I recall that it`s an audience favorite. It`s a good one. We`ll see what happens.

You guys can let me know of course @AriMelber if you have any thoughts. I hope you all have a great weekend. Thanks again to Lawrence and THE LAST WORD. And "THE 11TH HOUR" with Brian Williams starts right now.