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The Last Word with Lawrence O'Donnell 8/1/17 Bipartisan effort for healthcare

Guests: David Ignatius, Evelyn Farkas, Chris Murphy, Charlie Sykes

Show: THE LAST WORD WITH LAWRENCE O`DONNELL Date: August 1, 2017 Guest: David Ignatius, Evelyn Farkas, Chris Murphy, Charlie Sykes


JOY REID, MSNBC: Oh, good evening, Lawrence --

O`DONNELL: Good evening --

REID: I`m sure you think the White House is beautiful.

O`DONNELL: I have not been in a fancier place than the White House including any Manhattan apartment.

Although Donald Trump seems to think otherwise. And Joy, the what ifs -- the what if Anthony Scaramucci, what if someone like that was working in the Obama White House?

And what if that person was not white and those words became public? That person had said all of that. How long -- how long would it take for that person to be fired?

How long would it take for the impeachment screams to be heard?

REID: Yes, I remember conservatives got mad at President Obama for wearing a tan jacket and for not wearing a tie and said he was completely disrespecting the Oval Office by not wearing a tie.

But their current guy, the current occupant calls the White House a dump. A beautiful historic museum that belongs to the American people, a dump.

O`DONNELL: Joy, something you might have missed last night --

REID: Yes --

O`DONNELL: Because it was on another news work -- Eric Trump was on another news network. I leave it to you to guess which one.

He was on the highest-rated show on that other news network "Sean Hannity Show". And one of the things he said was, America loves Donald Trump. America -- people love Donald Trump.

And he is right, come on, people do love -- there are people who love him - -


A lot of people love him. But I actually looked at the cable news ratings last night and more people love Joy Reid because Joy Reid had, I don`t know, maybe double the audience that Eric Trump had talking to the people who love Donald Trump.

Joy Reid, highest-rated hour on cable news last night because people love Joy Reid.

REID: Oh, thank you so much --

O`DONNELL: It`s as simple as that --

REID: Thank you, Lawrence -- sorry, Sean, thank you, Lawrence.

O`DONNELL: Thank you, Joy.

REID: Have a great show.

O`DONNELL: Thank you.

REID: Bye.

O`DONNELL: Well, the debt ceiling is back, they had to come back. And so the Republicans will once again bring the economy of the United States and the world to the edge of collapse and maybe this time over the edge.

In a situation like that, it would be so nice to have a coherent president who understands the worldwide stakes involved in the U.S. debt ceiling.

But we don`t. We have someone who needs the kids at his side to try desperately to keep him coherent. But Jared Kushner and Ivanka Trump, even though they`re in the White House every day, cannot make him a coherent president.


JAY SEKULOW, LAWYER: The president was not involved in the drafting of the statement and did not issue the statement.

It came from Donald Trump Jr.

SARAH HUCKABEE SANDERS, DEPUTY WHITE HOUSE PRESS SECRETARY: The president weighed in as any father would based on the limited information that he had.

STEVE SCHMIDT, REPUBLICAN STRATEGIST: America is the oldest constitutional republic in the world. It`s not a family business.

UNIDENTIFIED FEMALE: They say that President Trump personally drafted that initial statement from his eldest son.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: When you get caught in a lie, not about one thing, it makes it hard to just say, let the other stuff go.

UNIDENTIFIED MALE: Every time there is one of these episodes, it creates additional people for Mueller and his team to interview.

UNIDENTIFIED FEMALE: I see what`s happening in the rest of the world and I have deep concern about our inability to focus on real problems and real problem-solving.

MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES: Very soon President Trump will sign legislation to strengthen and codify the United States sanctions against Russia.

REX TILLERSON, SECRETARY OF STATE, UNITED STATES: The action by the Congress to put the sanctions in place and the way they did, and neither the president nor I are very happy about that.


O`DONNELL: Jared Kushner and Ivanka Trump had absolutely no interest in politics, no interest in ever working in government and then Ivanka`s father ran for president.

And suddenly, Jared Kushner who knew absolutely nothing about any kind of political campaign, never mind the most complex of all of the presidential campaign was right there in the thick of the presidential campaign.

Why was he there? If he wanted to help his father to run his campaign, why didn`t he -- why didn`t he help him find someone to hire who actually knew something about presidential campaigns.

Why do it yourself when you can afford to hire an expert who can do it better than you can? Donald Trump never had anyone in his family piloting his airplanes and helicopters, he hired professionals for that.

And then, after coming in second in the vote count, but first in the electoral college, the Trump family suddenly found themselves in transition.

And Jared Kushner and Ivanka Trump decided to give up their comfortable lives in Manhattan, uproot their children and move to Washington to work in the White House.

Prior to election night when they were no doubt, as surprised as the rest of us at the outcome of the electoral college, neither one of them had ever given any thought of ever going to work in a government building of any kind.

Why would Jared Kushner do that? Why would Ivanka Trump move the kids to Washington? Take an office in the White House?

My first guess about why they were doing that might be true, but it`s not the whole story. The whole story includes something I did not suspect.

I did not suspect that Jared Kushner craved power in the White House and was going to seize control of an impossibly large portfolio of interests, but he did.

My first guess was simpler. It was simply that the kids were worried about the old man. The kids have been watching especially over recent years a decline in Donald Trump`s executive function.

Neurologists will tell you that it happens to most people his age, usually in ways that are barely perceptible. Forgetting the keys. Forgetting names.

Sometimes in ways that are glaring. What neurologists call executive function includes basic mental processes like attention control, cognitive inhibition, working memory, cognitive flexibility.

A decline in executive function is the beginning of the process that eventually leads you to take the car keys away from dad.

Having personally watched Donald Trump become increasingly incoherent over the last several years, my first assumption was the kids were going to Washington because they knew dad is utterly incoherent much of the time and forgetful and inattentive.

And so in the White House, someone he trusts would have to be able to whisper in his ear to remind him of what he said yesterday and what he should say now or remind him why he is having this meeting and to always be available to translate a president`s incoherence to people in the White House and the cabinet.

In effect, the president`s translator. That`s the job I thought Jared Kushner was going to have.

That`s an intimate job. A trusted family member makes sense for that job. It had to be Jared instead of Donald Jr. or Eric Trump because as some close observers of the president have reported, Donald Trump thinks his son-in-law is smarter than his sons.

Given what we know about Jared Kushner, that may be one of Donald Trump`s many misjudgments. As far as we know, Donald Trump Jr. and Eric Trump never suggested setting up a communication channel direct to Moscow that the Trump transition team could use at the Russian Embassy in Washington.

That was Jared`s idea. In the recorded history of presidential transitions, no one has ever made a stupider suggestion than that.

And that was Jared`s idea. It was Donald Trump Junior`s idea to invite Jared Kushner and Paul Manafort to a very important meeting that he had scheduled during the campaign which the e-mail traffic about the meeting identified as "Russia, Clinton, Private and Confidential".

The "New York Times" first reported that meeting three weeks ago on July 8th. Last night, the "Washington Post" reported that President Donald Trump personally dictated the words of Donald Trump Junior`s first public statement about the meeting that he gave to the "New York Times" when the "Times" asked him about it.

When the news of that meeting was first reported, the president`s lawyer said that the president had nothing to do with Donald Trump Junior`s statement even though the "New York Times" then reported that the president was consulted in the drafting of Donald Trump Junior`s statement.

Today, the White House Press Secretary said the president weighed in.


SANDERS: He certainly didn`t dictate, but you know, he -- like I said, he weighed in, offered suggestion like any father would do.


O`DONNELL: OK, let`s for the moment put aside whether the president weighed in or dictated every word of the statement and considered this demonstration of the president`s failure of neurological executive function when he was speaking in an interview with the "Wall Street Journal" last week.

This is last week. The president said to the "Wall Street Journal", "there`s nobody on the campaign that saw anybody from Russia.

We had nothing to do with Russia. Twelve days before that, the president told -- before the president told the "Wall Street Journal", there is nobody on the campaign that saw anybody from Russia.

Twelve days before that the president said this about his son`s meeting during the campaign in Trump Tower with Russians.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I think from a practical standpoint, most people would have taken that meeting.


O`DONNELL: The same mind that was out there publicly defending Donald Trump Junior`s meeting with Russians, 12 days later says, there`s nobody on the campaign that saw anybody from Russia.

Does the president have any memory at all of what he said 12 days earlier about the same thing. The country and the news media have gone so accustomed to the president`s constant incoherence that it mostly passes now without comment.

Prior to the Trump White House, any president being repeatedly, publicly, incoherent would be considered a crisis, a profoundly serious crisis right in the strike zone of the 25th Amendment which was enacted to remove presidents who were unable to discharge the powers and duties of the office.

That amendment was written in anticipation of mental illness, of mental disability as well as other health disabilities.

That amendment was written for presidents who sound like Donald Trump. Now, listen to every word that the president said when the "Wall Street Journal" asked him last week whether he will try to fire special prosecutor Robert Mueller -- "Wall Street Journal".

Sessions has recused himself, but is Bob Mueller`s job safe? There is speculation -- President Trump, no. We`re going to see, I mean, I have no comment yet because it`s too early, but we`ll see, we`re going to see.

So when asked if Bob Mueller`s job is safe, the president`s first word is no. Meaning, no, his job is not safe and might try to fire him.

And then the president says, we`re going to see, what that means is maybe. He then goes on to say it`s too early but we`ll see, we`re going to see.

We`ll see means I don`t know right now, it`s possible. That is a stunning answer about the future of a special prosecutor.

It`s possible he will be fired. But what if Donald Trump doesn`t even understand the words he`s using and what they mean whenever everyone else uses them?

What does we`ll see, we`re going to see, mean to Donald Trump? The most remarkable thing about that incoherent answer is that right in the middle of it, the president says, I have no comment.

And then he says, we`ll see, we`re going to see. Not realizing that that is a comment. The incoherent president gives a very important comment while saying he has no comment and it is largely ignorable by the news media because they have grown accustomed to having an incoherent president.

A president for whom words mean nothing. A White House where words mean nothing. And so when the White House today claims that the president weighed in on Donald Trump Junior`s first public statement about his meeting with Russians during the campaign, the only thing the White House spokesperson will say is that he weighed in.

A phrase that has no specificity, no meaning. Did he weigh in on every word? Did weighing in mean he dictated some of the sentences and not all of the sentences?

This morning, Matt Lauer asked Republican Senator Lindsey Graham about the possibility that the president dictated the words of Donald Trump Junior`s first statement about that meeting with Russians.


MATT LAUER, JOURNALIST: It sounds like the president himself was trying to cover up the truth about that meeting.

GRAHAM: If that`s true, then that was a bad decision by the president, which will make us ask more questions.

When you get caught in a lie about one thing, it makes it hard to just say, let the other stuff go.


O`DONNELL: Joining us now, Peter Baker; chief White House correspondent for the "New York Times" and an Msnbc political analyst.

He`s formerly the Moscow Bureau Chief for "The Washington Post". Also with us, Eli Stokols; White House correspondent for the "Wall Street Journal" and an Msnbc political contributor.

And Paul Butler; law professor at Georgetown University, a former federal prosecutor and an Msnbc contributor.

And Peter, I want to go to you, first, you`ve been in these interviews, these rambling incoherent interviews that the "New York Times" has conducted similar to the "Wall Street Journal`s" with the president.

What is it like in that room when he begins a sentence, cuts himself off, changes the subject, adds a new subject that isn`t clear at all.

Wanders off and then maybe never answers where the whole question began?

PETER BAKER, NEW YORK TIMES CHIEF WHITE HOUSE CORRESPONDENT: Well, he does -- he does free floats in these interviews.

He does tend to sort of wander from subject to subject a little bit. It`s very much to have consciousness. It`s very different than other presidents, no question about it.

Other presidents tend to stick to talking points, tend to stick to previously scripted answers they`ve given again and again and again and the struggle for an interviewer is to try to get them off that kind of game with President Trump at the other way around.

He`ll tend to sort of go where his mind takes him and where his -- you know, where he`s thinking about. And what you want to do is an interview to try to sort of really kind of force him to focus on one topic for a little bit and try to get a precise answer, get a sustained answer.

But the trick is, often these other thoughts, he expresses the new directions he goes with these answers are pretty interesting in their own right and you kind of want to explore them too.

So it`s a much more interesting and engaging kind of interview than some of the ones we have.

O`DONNELL: And Peter, your reaction to the White House position today, which is that, you know, the president just weighed in, whatever that means, on Donald Trump Junior`s first statement in response to your newspaper`s investigation of that meeting.

And then Donald Trump Junior had to issue two more statements each day the "New York Times" advanced the story.

BAKER: Yes, there are no question that the first statement was not a complete description of this event.

It said that the meeting was primarily about adoption policy and what it did not say is that it had been advertised as an opportunity to get incriminating information about Hillary Clinton provided by the Russian government.

That`s a very different understanding of that meeting. So the first statement was certainly not complete, certainly misleading.

We reported very shortly afterwards that the president himself had signed off on this statement. And then Jay Sekulow, who is one of his lawyers, went on television, went on this network and other networks to say, no, that`s not true.

That`s an incorrect statement, the president had no involvement in it. That obviously is not true according to White House itself today.

The White House itself today said he was involved with the use of words weigh in or dictate or whatever else.

The White House in effect confirmed what was reported way back in July that he was involved in the statement contrary to his own lawyer.

O`DONNELL: And Paul Butler, "The Washington Post" says multiple sources for its story about the president dictating every word of the statement.

And so when investigators see something like that, do they then try to find those sources who are unnamed in "The Washington Post" and try to get their accounts of this?

PAUL BUTLER, LAW PROFESSOR, GEORGETOWN UNIVERSITY: Lawrence, they don`t just try to find them, they subpoena them to come to --

O`DONNELL: So how do they do that when there are unnamed sources in "The Washington Post"?

BUTLER: And so they have -- Mueller has a team of some of the country`s best investigators and prosecutors. With all due respect to "The Washington Post", if "The Post" can find these guys, certainly investigators with subpoena power can find them and they will want to.

Because now if the post is correct, we have direct evidence that Trump not only participated in a cover-up, he did so trying to throw off the investigators.

We have evidence of a corrupt intent to impede an investigation, Lawrence, that`s obstruction of justice.

O`DONNELL: Eli, there`s another behavioral indicator in this story, and that is -- this is the way the Trump tells story.

The president saying, you know, taking a few different positions on weighed in or had nothing to do with it, but when you`re under oath, and testifying under oath, you can get tripped up by perjury wires on things that don`t seem particularly central to what the investigation is about.

It is not -- Donald Trump Junior`s first statement to the "New York Times" is not central to this investigation.

But if someone does not tell the truth under oath, in questioning about that, someone can end up with a perjury charge on this peripheral matter.

ELI STOKOLS, WALL STREET JOURNAL WHITE HOUSE CORRESPONDENT: Right, and this so far has just been a constant story about hubris, arrogance.

You can kind of understand why maybe they were over confident inside Trump Tower during the transition and continue to be inside the White House.

They won the election. Donald Trump`s pension for contradicting himself almost constantly, for adhering to the life-long policy as described in the "Art of the Deal" of truthful hyperbole.

All these things were visible to the whole country and he won anyway. And so, you can kind of understand where some of this hubris comes from after November 8th.

But the reality is, they continue to sort of -- as Lindsey Graham said, they want to get out of one box and they put themselves in an even tighter box because they are so eager, they`re so short-sided and sort of trying to win every point, not letting anything go.

Not thinking they need to consult with their lawyers, just sort of immediately, rationally reacting on Twitter.

That is a tendency that continues to exacerbate the legal trouble it seems for this president and perhaps for some campaign folks as well.

O`DONNELL: And Peter Baker, working for one of the two newspapers, you with the "New York Times" and "The Washington Post" that keep delivering these blockbuster revelations about the Trump White House, almost entirely from unnamed sources within the Trump White House or the Trump world.

I just would like to get a general sense from you of what your guess is about the special prosecutors ability to find those sources that have been speaking, without their names in "The Washington Post", in the "New York Times" -- and I`m not talking about you going anywhere near those sources.

But just the extent to which you sensed they are available to talk and willing and/or eager to talk.

BAKER: Well, that`s a good question. Look, you know, as was just said there are -- you know, prosecutors or the subpoena power have an awful lot of leavers to work to get people to testify.

And what they tend to do is they tend to work on the outside in. They tend to get people who are, you know, providing information about other people who then are brought under oath and then challenged with the information they`ve already been gotten and so forth.

I don`t think it`s that hard for prosecutors to find people to testify about things like this. I think the harder thing for this prosecutor is to figure out, you know, what was going on with the Russians.

Remember, this isn`t a typical political scandal, this isn`t a particular - - you know, thing we`ve seen in the past. This involves intelligence, you know, another culture, another language, another government.

What their intent was, what their modus was, and I think that`s where -- it`s a more complicated thing than putting people who are Americans and who have been involved in campaign under, that`s a pretty basic thing that they do, you know, quite often.

O`DONNELL: Which brings us to a "Reuters" report tonight of a new attorney joining Robert Mueller`s team, Greg Andres; he was the deputy assistant attorney general in the Criminal Division where he oversaw the fraud unit and managed the program that targeted illegal foreign bribery.

Paul Butler, your reaction to that addition to the team?

BUTLER: You know, it really doesn`t matter who president`s lawyer is, if he doesn`t listen to them. So we had his current lawyer Jay Sekulow, going on Msnbc and other news sources saying that the president had nothing to do with Don Junior`s memo or his recollections of the meeting.

We now know that that was false which means either that President Trump was lying to his lawyer or his lawyer was lying to the American people, which would be a violation of the code of ethics among other things.

O`DONNELL: Eli Stokols, as Robert Mueller continues to staff up, he is been defended by both parties in the Congress, Democrats and Republicans.

Some saying that if the president makes a move on the Justice Department, that could be the turning point that could point to a shorter term than four years for this presidency.

STOKOLS: Yes, Lindsay Graham said last week, you know, explicitly, that if the president decides to go after Mueller, that could be the beginning of the end of his presidency.

And you`ve seen really over the past week more Republicans taking more strident positions, criticizing this president more directly.

It`s not just Lindsey Graham and Ben Sasse anymore. There are other people coming out, Jeff Flake being one of them.

But there are a number of people really sort of standing up and saying this bothers me too and sort of breaking six months of silence.

And I think, you know, going back to the Mueller hiring a white-collar crime attorney to add to the legal team, it`s obviously a sign that this investigation is only just getting started.

We`ll probably go into 2018 and maybe past 2018. But that is going to drive President Trump up the wall. What did he say about a week or two ago?

You can focus on Russia, but that`s it. When he hears there is somebody who is an expert in white-collar crimes has been added to this legal team, I mean, I would just say I`m going to set my alarm for about pretty early tomorrow morning and check Twitter for what the president has to say because this is something that seems like almost inevitably is going to set him off.

O`DONNELL: Well, that`s going to be a big test for the new White House chief of staff if something happens on Twitter tomorrow morning. Eli Stokols, Peter Baker and Professor Paul Butler, thank you all for joining us tonight, really appreciate it.

Coming up, what is President Trump doing with the new Russia sanctions bill? It has been passed and he is sitting there not signing it.

Meanwhile, Vladimir Putin is expelling United States staffers from the American Embassy in Moscow.

And later, what Republicans have learned about President Trump on legislating, his failure on the health care bill. What does that mean on the debt ceiling which absolutely must pass and what does it mean on the Republican dream of tax cuts?


O`DONNELL: Tonight, the president has still not signed the sanctions bill punishing Russia for election hacking.

Congress passed that bill last week and the president said in a statement that he intended to sign it. Here is what White House Press Secretary Sarah Huckabee Sanders said today.


SANDERS: There`s nothing holding him back. There is a review process, a legal process, they`re going through that and he`ll sign the bill and we`ll let you guys know.


O`DONNELL: While, the White House is going through its review process. the president still has not said one word, not one word, about Russia expelling 755 staffers from the American Embassy in Moscow.

And now Russia has begun preparations to move some 100,000 troops to its border with NATO countries and one of the biggest steps taken so far in Vladimir Putin`s recent military build-up, the Russian military exercise has been planned for months and is not seen as a response to the U.S. sanctions bill necessarily.

Today, at the State Department, Secretary of State Rex Tillerson said this about the United States and Russia.


TILLERSON: The relationship as you know in Russia continues to be under considerable stress by the action by the Congress to put the sanctions in place and the way they did, neither the president nor I are very happy about that.

We were clear that we didn`t think it was going to be helpful to our efforts. But that`s the decision they made, they made it in a very overwhelming way, I think the president accepts that.


O`DONNELL: Also today, "The Washington Post" reports that under the re- work organization of the State Department, Secretary Tillerson is considering eliminating from the State Department`s mission, promoting and supporting democracy around the world.

Joining us now, David Ignatius; foreign affairs columnist and associate editor for "The Washington Post", he`s also an Msnbc and Nbc News political analyst.

Also with us, Evelyn Farkus; senior fellow at the Atlantic Council and a former deputy assistant Secretary of Defense responsible for policy on Russia, she is an Msnbc national security analyst.

David Ignatius, your reaction to the delay in the signing of the sanctions bill, not one word from the president about the expulsion of 755 Americans from the Moscow Embassy.

And what Rex Tillerson meant today about how disappointed he and the president were with the Russia sanctions bill.

DAVID IGNATIUS, FOREIGN AFFAIRS COLUMNIST & ASSOCIATE EDITOR, WASHINGTON POST: It`s odd, Lawrence, like everything about the Trump administration and Russia, this is peculiar to have this enormous expulsion order and no White House response.

Mike Pence; the vice president said today in Georgia that the president will sign the bill. So I`m sure the signing is coming.

I know the White House is trying to put together a signing statement that sometimes accompanies signing of bills.

Presidents in general don`t like to have their authority challenged on foreign policy matters. That was true with President Obama, it`s been true for years.

So they`re working on the signing statement with the idea that the Russians would do this and there`d be no Trump reaction, I think just reinforces kind of ambivalence, that`s pretty (INAUDIBLE) that he yields toward Putin.

It was going to be the bromance. Even a month ago I mean in - in Hamburg it seems like the two of them were going to move down the road together.

That period is clearly over.

LAWRENCE O`DONNELL, MSNBC ANCHOR: And Evelyn Farkas, here is a president who has insulted leaders around the world who have never - never considered expelling any American from any American embassy you know from Australia to Germany. And here he is absolutely silent on this. But I want to get as a - as a former state department staffer.

I want to get your reaction to --


O`DONNELL: Sorry, defense. The notion that - that the state department would drop from its mission. The promotion and support of democracy around the world.

FARKAS: Yes. So as former defense department and actually senate staffer I view that with a lot of concern. Because you know, we`ve never dropped democracy from our mission even when the United States was as most isolationist. We said, well we`re going to stand as the city on the hill, the example for the world. So we`re not going to intervene, we`re not going to try to tell people how to run their lives.

But we want to still be an example for them of how you can be democratic and prosperous. And I think taking the democratic part out of that equation is a mistake. The administration could have said, we`re not going to be interventionist, we`re not going to force democracy on people. That`s one thing. But to say, to actually eliminate democratic, I mean that`s what makes us different as Americans.

We`re not just about prosperity. We`re about values, democracy. How do we get to prosperity, we do it through democracy. Every man and woman, one vote, et cetera.

O`DONNELL: And David, what I find so striking about this is that a mission statement of the state department is kind of like a platform like a party platform at a convention. No one ever reads it, no one ever thinks about it. It`s never crossed my mind before until someone in the Trump state department has come along and said, oh, I have an idea. Let`s take out the idea that we want to support and promote democracy around the world.

IGNATIUS: You know I worry that this administration really is trying to dismantle the liberal international order it was called. The structure of this has been under challenge from the administration since inauguration day. The G20 summit was an example. The positions taken by the United States on climate change, on so many issues left the U.S. Isolated and separate. And separet from the values it`s represented through its modern history.

This is a -- we live in a world that was built by the United States values, the institutions we shaped after 1945. It`s a world that I think has thrived in that era of the liberal international order. Trump and Steve Bannon and others regarded it as essentially the enemy and want to take it apart. And I think the state department`s action on democracy promotion on devaluing human rights is an issue. They`re all part of this campaign.

You know I just think it`s making us - the United States weaker by the month. You look at polls, the -- the standing United States in the world`s eyes has plummeted since January. The numbers are striking. And in the end that means that our strength, our security as a country is diminished by the lack of support from our traditional friends and allies.

O`DONNELL: David Ignatius and Evelyn Farkas. Thank you both for joining us tonight. I really appreciate it.

FARKAS: Thank you Lawrence.

IGNATIUS: Thank you.

O`DONNELL: Coming up the debt ceiling and other potential disasters are looming.



REPORTER: Are you afraid of President Trump?

SUSAN COLLINS, UNITED STATES SENATOR: No. I`m a senator who was duly elected by the people of Maine. I`m very honored to have that position. And I`m going to do what I think is right and sometimes that means I`m going to be agreeing with the president and sometimes it means that I`m not.


O`DONNELL: Senator Collins was the strongest republican opponent to the Trump-McConnell health care bill in the senate. And today republicans and democrats announced a plan to try to work together on the next step in health care legislation. The next step in health education and labor committee will begin holding hearings in September, "on the actions congress should take to stabilize and strengthen the individual health insurance market." Joining us now, Senator Chris Murphy from Connecticut.

He is a member of that committee. Senator Murphy thank you very much for joining us tonight, this -- this is a routine announcement in the past in the senate that this committee that has jurisdiction over this subject is going to have hearings on this subject. But in the senate you`ve been working in this is a break through.

CHRIS MURPHY, UNITED STATES SENATOR: Yes it is a break through. And I guess it`s better late than never but the problem is we`re up against the clock. Insurers are making decisions this fall about the rates that they will offer on the exchanges. Whether or not they will continue to participate and what we`re talking about in this bipartisan negotiations is essentially taking the keys to the American health care system away from the president of the United States because we`re pretty convinced that he is going to use it to drive the health care system into the ground.

So we have a really short window here to try to rescue these exchanges, to rescue the health care system from Donald Trump he`s trying to sabotage this system in order to make sure that millions of people who get health care today through these ACA exchanges continue to get them. So we don`t have a lot of time here. Would have been a lot better had we started talking to each (INAUDIBLE) included us in these discussions a couple months ago.

O`DONNELL: The president took to twitter to complain bitterly about filibuster rules in the senate after the defeat of the health care bill. Apparently not comprehending that that had absolutely nothing to do with the way the health care bill went down. So let`s listen to Mitch McConnell correcting the president on that.


MITCH MCCONNELL, UNITED STATES SENATOR: Well, I mean, it is pretty obvious that our problem on health care was not the democrats. We didn`t have 50 republicans. They are not the votes in the senate as I`ve said repeatedly to the president and to all of you to change the rules of the senate. It would require 50 or 51 republicans to agree to do the votes are simply not there.


O`DONNELL: That sounds like majority leader who is ready to move on, senator.

MURPHY: Yes he is not going to get 50 votes on health care reform. Why? Because the bill that they continue to put forward is widely unpopular amongst the American public and frankly it`s a miracle that they got 49 votes on a bill that enjoys 15 percent approval out there in America that uninsures 20 million people and drives up rates by 20 percent. Now again, if they`re willing to work with us on a bill that maybe gives republicans a little bit on flexibility and gives us and the American public something on long-term security and stability on these marketplaces, we could get 70 votes for it.

But yes, he is right to correct Donald Trump. But the problem is not the filibuster. The problem is that you spent six to seven years driving the affordable care act, calling for replacement and republicans didn`t bother to spend any of that time actually coming up with any good ideas on how to replace it.

O`DONNELL: Senator, I want to get your reaction as member of the foreign relations committee where the sanctions bill originates. The president`s delay in signing the Russia sanctions bill and not a word from the president about 755 Americans being expelled from the Moscow embassy.

MURPHY: Yes it is par for the course. This president has you know taken a really odd series of positions on U.S.-Russia relations. And I -- I guess this stands in that pattern of behavior. I take him at his word that he`s eventually going to sign this piece of legislation. He is right that it is complicated. But we are in the position today that we are in because Donald Trump has sent a myriad of signals to the Russians that they have free reign around the world to grow their influence to interfere in other people`s elections, to try to spread their influence into places that we had checked them before.

So I think his silence on the expulsion of hundreds of American diplomats is yet another signal to Putin that he can continue to spread his wings in his periphery without any push back. Of course the irony is that you know Putin is expelling a bunch of people who help Russians visit the United States. And so the detriment of these expulsions are mainly going to be to the Russian people, not the U.S. government.

O`DONNELL: Connecticut senator Chris Murphy thank you very much for joining us tonight, really appreciate it.

MURPHY: Thanks.

O`DONNELL: Coming up, President Trump proves he doesn`t know the difference between tax reforms and tax cuts and there is a big difference. But Mitch McConnell is worried that his dream of tax cuts will sink into Donald Trump`s incoherence. That`s next.


O`DONNELL: The new Whitehouse Chief of Staff, John Kelly, has reached out the Democrat leaders in Congress Nancy Pelosi and Chuck Schumer hoping to find some areas of bipartisan cooperation on Capitol Hill. But today Mitch McConnell said the big Republican crusade after the August recess is what he calls tax reform which is what he calls a big giant tax cut. Senator McConnell says he expects to do that tax cut with Republican votes only. 45 Democratic Senators sent a letter to Mitch McConnell today saying they would oppose any tax bill that would increase the deficit or cut taxes on the richest 1 percent of taxpayers.

The biggest political weakness and the republican tax plan is the incoherence of Donald Trump. Donald Trump, first of all, didn`t know what to call it. Last week in his interview with Wall Street Journal, President Trump said you know, it`s tax reform but a dig tax cut but simplification and its reform and its a big tax cut.

Tax reform is when you simplify the tax code by eliminating deductions when you eliminate those deductions taxes go up on the people and corporations who have been using those deductions. But then because of the elimination of those deductions and the new generated revenue to the treasury you can use that revenue to cut tax rate. So that most taxpayers are better off or paying the same.

I may lose my deduction but because my income tax rate goes down I may end paying less or the same in taxes in the end. And when the dust clears the treasury is supposed to be left with the same amount of revenue. That`s what tax reform is.

A tax cut is when you don`t eliminate any deductions and you just cut taxes. And the treasury just loses money. And that is what the Republicans have always done and that`s what they`re planning to do this time. And because Mitch McConnell knows that Democrats will refuse to cut taxes on the top 1 percent of income earnings, he knows he`s going to have to do this with only Republican votes because like all Republican tax cuts, Mitch McConnell will make sure that most of that money goes to the very, very rich.

And in his interview with the Wall Street Journal Donald Trump made life all the more difficult for Mitch McConnell once again. The President said, you know, I was with Bob Craft the other night. He came to have dinner with me. He`s a friend of mine.

And as he left, he said, Donald, don`t worry about the rich people. Tax the rich people. You got to take care of the people in the country. It was a very interesting statement. I feel the same way.

So there`s the Republican President agreeing with Democrat Chuck Schumer without realizing it and disagreeing with Republican Mitch McConnell without realizing it which is the kind of thing the President did on health care for a year. When the President would say he was going to take care of everyone`s health care, not realizing that`s the most liberal position possible and the President cheers on a bill that would take health care coverage way from 32 million people.

If the President keeps this up, he just might lead the Republicans to failure on something they`ve never failed to do before. Cut taxes. Including a really, really big tax cut for Bob Craft and all the rest of Donald Trump`s very rich friends.

Up next, why the debt ceiling is going to be the next very serious piece of business in Congress and why this time Donald Trump`s incoherence really could do unimaginable damage to the United States and the world.



MITCH MCCONNELL, UNITED STATES SENATOR: The secretary of the treasury, Senator Schumer and I had a good meeting in my office to discuss the raising of the debt ceiling.


O`DONNELL: That`s right the debt ceiling is back which means Washington is going crazy by the end of September. Joining us now is Charlie Sykes and MSNBC political analyst. And Charlie one of the most underreported important items last week the Treasury Secretary said on Friday you got to raise the debt ceiling by the 29th or the United States will go into default.

CHARLIE SYKES, MSNBC CONTRIBUTOR: Yes. This is a chaos presidency. We maybe about to see how chaotic it can be because you can make a long list of things that could go wrong here. And quite frankly, you know, Donald Trump`s ability to influence Congress I think is diminishing by the day. But in this particular case you do need the 60 votes to get that raised. And I`m not sure they have a formula to do that.

O`DONNELL: No. And you have so many Republicans in both bodies who have been opposed to raising the debt ceiling in the past. It had to be done with Democratic votes. What do the Democrats do this time?

Do they say it`s up to you? You guys do it on your own and force the Republicans to either fail to raise the debt ceiling or break in re vows about everything they`ve ever said about it?

SYKES: Yes, we`re in the weird situation the Republicans have very few option. Democrats have a lot of options including for example what will the Republican do? What would President Trump do if the democrats insisted the cost sharing payments in Obamacare be included to actually get legislative approval as part of the debt ceiling package. You know, is it a possibility that a Trump Whitehouse would veto this particular legislation?

You know, in a lot of ways Donald Trump, you know, needs to get his mojo back and maybe doing something like shutting down the Federal Government would get him back to his -- his safe space. So I don`t know what`s going to happen but this is the under covered story with all of the train wrecks we`ve seen with health care. This one could be the big one.

O`DONNELL: And we -- what we`ve seen in the past is some junior members of the Congress and sometimes more than junior members who simply don`t understand the debt ceiling they think the united states can default on debt and everything is okay. We have -- we have a President who doesn`t understand the debt ceiling.

That`s the first time that`s ever happened. And ge is the guy who has played games with debt his entire life. He believes debt is a game that could be the most dangerous element to this whole thing.

SYKES: Well and as you pointed out we`re about to see what the price tag were going to pay for the President`s incoherence and his ignorance on policy but also his recklessness. Look this debt ceiling issue is an easy issue for politician to demagogue. This will be a very, very tempting target for the president. So you know again you got shine the spotlight what`s coming down the track.

O`DONNELL: September 29th. We will work late that night. That`s when we hit the debt ceiling. Charlie Sykes thanks for joining us, really appreciate it.

SYKES: Thank you.

O`DONNELL: Tonight`s Last Word is next.



STEPHEN COLBERT, COMEDIAN: According to white house sources Kelly let the Mooch go because he wanted more structure, less of Game of Thrones. That`s not fair. That`s not a fair comparison with Game of Thrones.