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News White House chaotic Day. TRANSCRIPT: 12/20/2018, The Last Word w. Lawrence O'Donnell.

Guests: Eli Stokols, Tim Ryan; Ken Dilanian; Matt Miller; Michael Moore

Show: THE LAST WORD WITH LAWRENCE O`DONNELL Date: December 20, 2018 Guest: Eli Stokols, Tim Ryan; Ken Dilanian; Matt Miller; Michael Moore

ALI VELSHI, MSNBC HOST: I need a belly laugh. Thank you.


VELSHI: The point of the conversation with Michael about the defense secretary being an adult in the room, though, is very worrisome, isn`t it?

MADDOW: Indeed and apparently, that characterization bugged the president a lot, but him being gone is even more worrying.

VELSHI: Rachel, have a good evening. We`ll see you tomorrow.

MADDOW: Thanks, Ali.

VELSHI: Good night, everyone.

Tonight is a very big night here. Former CIA director John Brennan will join me shortly to discuss the growing national security crisis that is facing this administration. Later in the hour, Michael Moore will react to this historic day of turmoil.

But we begin with an administration and a president in chaos, total chaos. And just because we say that a lot doesn`t make it any less true. Defense Secretary James Mattis went out with a bang today announcing he is leaving his post at the end of February. NBC News is reporting that Mattis went to the White House this afternoon and presented Trump with a resignation letter which Trump then read in front of him and then they had that was phrased to our reporters as a quote, difference of opinion.

There`s no surprise why if you read the letter. In it, Mattis writes you have a right to a secretary of defense whose viewers are better aligned with yours, citing differences between their approach, to quote, countries whose strategic interests are increasingly in tension with ours. Mattis goes onto stress, quote, my views on treating allies with respect and being clear-eyed about both maligned actors and strategic competitors are strongly held and informed by over four decades of immersion in these issues, end quote.

One senior national security official described the loss of Mattis like this, the wheels are coming off.

Here`s House Minority Leader Nancy Pelosi tonight.


REP. NANCY PELOSI (D-CA), HOUSE MINORITY LEADER: I`m shaken by the news because of the patriot that General -- Secretary Mattis is. I think everybody in the country should read his letter of resignation. It`s a letter of great patriotism, with respect for the president but also a statement of his values.


VELSHI: Secretary Mattis is leaving at a critical moment for this administration. Just yesterday, the president announced a troop withdrawal from Syria, and there are new reports that the president is considering withdrawing troops from Afghanistan.

Retired General Barry McCaffrey put the situation like this to Chuck Todd.


RET. GEN. BARRY MCCAFFREY: There`s only two people in national security that are vital to the safety of the American people. One`s the secretary of defense. And the other is the homeland security secretary. The latter probably is about to go also, and so losing Secretary Mattis --


MCCAFFREY: -- ought to be a concern not just to combat troops but also the American people.


VELSHI: The president`s profound political limitations have been on full display this week as the country careens toward a government shutdown. One source close to the president has described him as, quote, 100 percent in a tailspin.

Trump torpedoed a spending bill over his demand for $5 billion in border wall funding, refusing to sign a stopgap measure to keep funds flowing past Friday at midnight. It seems the president is letting a handful of hard right politicians and media personalities govern the country for him.

Once Trump appeared to waver on that border wall promise, Fox News commentators, personalities like Anne Coulter and members of the House Freedom Caucus warned if he didn`t veto the Senate passed measure that failed to fund the wall, he would lose his core supporters. If it wasn`t obvious that Trump was controlled by these right wing factions, Rush Limbaugh made it clear with this announcement.


RUSH LIMBAUGH, RADIO TALK SHOW HOST: I`ve just received clearance, the president has gotten word to me that he is either getting funding for the border or he`s shutting the whole thing down.


VELSHI: All right, let`s put this all together and figure out where we are now. House Republicans had the votes tonight to add the $5 billion in border wall funding to the resolution that would fund the government beyond tomorrow night. So now that goes back to the Senate, which will reconvene tomorrow at noon. Mitch McConnell has told senators, many of whom thought their work was done when they passed a resolution to keep the government open last night, but they need the come back to vote.

But let me be clear, this is nonstarter in the Senate. There`s no way that wall funding is going to pass in the Senate. It doesn`t have the 60 votes need -- 60. And Republicans know that.

Sources earlier today told NBC News there`s no long-term game plan for Republicans. The desire among the GOP was to be seen to be fighting for that wall. There was literally no plan beyond that, even if it led to shutdown.

So, there`s in flux at the moment as to where exactly we will end up. There`s only one thing for certain, the drama will drag on for another day. All of this chaos sent stocks plummeting. The Dow Jones dropped almost 470 points today, bringing its five day losses to more than 1,700 points that`s your 401k.

And the bad news doesn`t end for Trump. NBC News is reporting tonight that special counsel Robert Mueller is, quote, nearing the end of his historic investigation and is expected to submit his controversial report to the attorney general as early as mid-February.

All right. Leading off our conversation tonight, former CIA Director John Brennan. He`s a senior national security and intelligence analyst for MSNBC and NBC News.

John, good to see you. Thank you for being with us.

How do you read this? And I want to put this n context of the fact that in an administration where so many office holders and cabinet secretaries are doubted by the American public, in an administration that leads us to question its capacity for leadership and governance, Mattis was an exception.

JOHN BRENNAN, NBC NEWS SENIOR NATIONAL SECURITY AND INTELLIGENCE ANALYST: That`s right, Ali. Jim Mattis is a consummate the military defense professional. He is a soldier`s soldier, widely respected within the Pentagon, within the U.S. Armed Forces and a great voice of reason, sanity, common sense and experience within this administration.

And so, his decision to leave, whether he was forced to or decided he could no longer abide by what is happening in this administration, is a great loss for our country. And it should be seen as a very worrisome development that Mr. Trump continues to take these rather irresponsible, repulsive and reckless actions to the detriment of national security.

Jim Mattis is somebody who we all in previous administrations have greatly admired and respected. And we`re very glad he was at the helm of the U.S. military as secretary of defense. So his departure is something I think we all should be concerned about.

VELSHI: I want to read you a statement that was put out by Mitch McConnell who as you know, and Kasie Hunt points out, very rarely breaks with the president in public. And he said I was particularly distressed that, he meaning Mattis, is resigning due to sharp differences with the president on these and other key aspects of America`s global leadership.

John, that`s really the issue. It`s not that Mattis is resigning. People resign. It`s that he has stated very clearly in his letter to the president which Nancy Pelosi says Americans should read, they should read, he`s stating that Donald Trump seems to have policy interests that align with our adversaries and don`t align specifically with our allies.

Can I read you this excerpt from the letter in which he says we must use all tools of American power to provide for the common defense, including providing effective leadership to our alliances. NATO`s 29 democracies demonstrated that strength in their commitment to fight alongside us following the 9/11 attack on America. The defeat of ISIS coalitions of 74 nations is further proof.


BRENNAN: Yes, and that`s why I think Mr. Trump`s withdrawing precipitously are really damaging to U.S. national security interests. And so, Jim, I think was just quite frankly fed up, but also I think he was very concerned about the security related to a very, very quick withdrawal of U.S. military forces. One thing Jim Mattis was known for was making sure operational security was going to be paramount even during a retrograde or withdrawal of U.S. military forces.

And for Mr. Trump to so capriciously and arbitrarily decide that they`re going to be out in a very quick period of time, it`s also going to be seen and is seen as an abandonment of our partners and allies who we`ve worked with closely for the past years. And so, I`m sure that there`s great frustration and anxiety within the U.S. military right now about what is happening and what we`re going to be leaving behind.

VELSHI: And Mattis seems to be making a reference to something that goes beyond just these alliances of the last few years that you`re talking about. He seems to be making particularly in his NATO comments a reference to almost really 80 years of American leadership of liberal democracy in which he says -- this is in his resignation letter. We must do everything possible to advance an international order that is most conducive to our security, prosperity and values, and we are strengthened in this effort by the solidarity of our alliances.

John Brennan, that sentence could have been written 50 years ago, 60 years ago, 70 years ago at the end of World War II. He is saying this is something we have been committed to as a nation for decades that he seems to be implying we`re slipping away from.

BRENNAN: Yes. And Jim Mattis recognizes that America`s military and political might is not just capability of our tremendous capability and resources, but because we`ve had this leadership role certainly over the last 75 years where we`ve been able to bring together alliances and partnerships and coalitions so that we can fight these forces that are determined to undermine global security.

I also find it noteworthy that not a single word of praise to Jim Mattis included in that letter for Mr. Trump. Rather unprecedented there`s not a single word of appreciation or praise of this administration and Mr. Trump.

VELSHI: John, if you`ll standby. I`m going to need your continued analysis to get through this complicated evening. But joining us now are Eli Stokols, White House correspondent for "The Los Angeles Times", and Evelyn Farkas, senior fellow at the German Marshall Fund, a former deputy assistant secretary of defense and MSNBC national security analyst. She`s a colleague of Jim Mattis who has worked with him for the past 20 years.

I want to play for you, Evelyn, something that Senator Bob Corker, who`s, you know, a bit of a leading thinker on foreign policy in the United States, the outgoing senator, said on October -- in October of 2017 about people including Mattis. Let`s listen.


SEN. BOB CORKER (R-TN), CHAIRMAN, FOREIGN RELATIONS COMMITTEE: I think Secretary Tillerson, Secretary Mattis and Chief of Staff Kelly are those people that help separate our country from chaos.


VELSHI: It`s a serious statement. Separate our country from chaos.

As Rachel Maddow says Donald Trump does not like to hear references to adults in the room or people who keep him away from danger. But the truth is lots of people thought that was what Mattis was doing and with the departure of Tillerson, they sort of thought this might be the last man standing.

EVELYN FARKAS, MSNBC NATIONAL SECURITY ANALYST: Yes, Ali, I spoke to Secretary Mattis before he took office, so before he became secretary of defense. He called me to ask about Russia related things. And at the time I said something to him like please keep us safe or some sort of veiled thing because I knew there were probably other people listening on the phone, and he said that`s exactly my intent. And there was something about the way he said it, I knew exactly that we were communicating to one another.

Meaning, he was the type of person who took the responsibility that he had very seriously, the responsibility to look out, first of all, for the American national security interest and second, for the men and women in the armed forces. And I think what happened here more recently with the various things that occurred and the things that didn`t occur that he had been fighting, I think he just reached a point where he realized he was now potentially going to be part of jeopardizing those two objectives, keeping men and women in arms safe and looking out for our national security interests.

VELSHI: And there`s a list of things that a lesser person probably would have quit over a long time ago, not the least of which as John Brennan said was a strange and this somewhat uninformed decision the president made to go publicly and say he`s pulling U.S. troops out of Syria.

But let`s talk about some other things, the decision to pull out of the Iran deal, pausing U.S. military exercises with South Korea, something he said was too much money even though our activities on the southern border cost many times more than those, directing the Pentagon to develop the space force. It almost seems like Mattis sort of stood by and let Trump do and say things that undermined his role as defense secretary and finally there was something that broke the camel`s back, probably Syria.

ELI STOKOLS, WHITE HOUSE REPORTER, LOS ANGELES TIMES: I think for a long time, General Mattis believed that he was one of the adults around Trump, and that even though he didn`t win every battle, it was important for him to be there. He wasn`t sure what would happen if he were to leave.

But over the last couple of months, starting with the president sending troops down to the border with our reporting, General Mattis was not happy about that. He didn`t betray a lot of that publicly. But behind the scenes, you could understand and read between the lines of what he said, that he was keeping a close eye on that mission and did not like the troops being politicized at the end of the election along the border.

Trump went over him in replacing the joint chairman of the chiefs of staff. And then this week culminating with Trump`s rash decision announced on Twitter to pull the troops out of Syria and going into the Rose Garden, recording that video yesterday saying inexplicably that ISIS has been defeated when not even the president`s closest allies, Republican allies on Capitol Hill will grant him that because it`s just not true.

When the general sees all those things together, I`m sure he had to ask himself what good am I doing being here especially with John Bolton installed as national security advisor. It just seemed Mattis` ability to reign in the president just sort of withered away. And from what we understand, they had a very candid conversation this afternoon in the Oval Office, the president was bought into this decision and that was pretty much it.

VELSHI: Evelyn, if we get a letter of resignation like this from the commerce secretary, or the HUD secretary, none would be that worried about it. There are people who are worried, who have used the expression it`s a national security concern or even a crisis. Tell me as somebody who has spent time in the Department of Defense what you think about this.

FARKAS: I think it`s shocking because the letter clearly was first of all a letter of protest. It was a protest resignation and then Secretary Mattis felt the need to spell out for the president exactly what he stands for, why our alliances are important, to remind him there are 28 countries in NATO standing with us in Afghanistan and elsewhere, that they`re part of the 74-nation coalition fighting ISIS in the middle east, right, which is not just in Syria but also in Iraq.

And so, he actually gave the president a tutorial, which as we know from reporting from Bob Woodward and others he`s already done in other situations. That is unprecedented. I can`t imagine, and I`m sure Director Brennan has never seen a resignation letter to a president where the person writing the letter actually gives the president a lesson on the value of alliances. That`s -- you never would have found that for George H.W. Bush, for George W. Bush, for Bill Clinton, for Barack Obama. I mean --

VELSHI: Right, and you`re right because a lot of stuff in that letter is a treatise on liberal democracy and the values that we hold dear. Now, President Trump doesn`t like the deep state, doesn`t like institutionalists, he doesn`t like people that are you`ve been on the other side of that, so you know it well, it did seem to like generals for a while. And that hasn`t worked out for him all that well.

But one of the things that was important was the ability to take advice from people who have been out there, who have seen the enemy, who understood the dangers not only America faces but our men and women in uniform face.

Sarah Huckabee Sanders said tonight on Fox News the president takes advice from generals but he makes the decision in the end. How do you handle this when the president makes decisions that are at odds of the experts who he chooses to be closest to him?

BRENNAN: Well, as just said, he`s looking for yes people to surround him, and Jim Mattis was the person I think would raise issues and questions and also challenge some of the points Mr. Trump might raise in these meetings. Who now is left to challenge Mr. Trump when he decides to move down some road, whether it be in Syria, Iran, North Korea, and some of these other areas, China and Russia. People have to be able to speak up and bring to Mr. Trump and to that discussion the voice of reason and experience. And Jim Mattis was that person. John Kelly I think also was that person.

And so, now, we`re left with people who are yes men, whether it be a Mike Pompeo or John Bolton or others. These are individuals who have not demonstrated any backbone or spine in terms of standing up. Jim Mattis I think he`s been true to who has been throughout the course of his life, which a patriot and dedicated and loyal to this country.

VELSHI: All right. So, we need backbone, we need spine, we need some degree with sophistication. John Brennan just mentioned Syria, Iran, North Korea and Russia all pressing national security issues for the United States, and there are others we haven`t mentioned. What`s your reporting tell you what happens next?

STOKOLS: Well, I think people inside the White House who really don`t know what happens next. There was a lot of -- you could see this coming just looking at the relationship between these two men, but this happening today amidst all these other things that are happening, the government shutdown being right on the edge, the market dropping, there are a lot of other confirmation hearings that Congress is going to have to take up come 2019.

Just so much on this White House`s plate, and inside you talk to people and they really don`t know who`s going to be inside the building come January just given the revolving door. A lot of people not wanting to be part of this administration. You saw the difficulty the president had in recent days just getting someone to sign-on to be chief of staff.

So, it is -- you know, we talked about this being a chaotic administration, a chaos president for a long time, but that`s sort of reaching a new level at the end of the year here especially with the president looking ahead, seeing a Democratic Congress in the House and the ability to subpoena a lot of information, make his life more difficult in 2019. It`s just a very uncertain time there and I think, you know, the consequences just in terms of what you`re talking about and the challenges that we confront around the world that the next secretary of defense will have to face -- you know, these are very serious challenges in addition to what`s facing the president politically, and we don`t really know at this point who`s going to come in to sort of confront them on his behalf.

VELSHI: Well said, thank you. Eli Stokols, John Brennan, Evelyn Farkas, thanks for your analysis.

Coming up, the stock market dropped, the government is going to shutdown, and still House Republicans stayed loyal to the president today. Democratic Congressman Tim Ryan joins me next.

We also have breaking news from the Department of Justice. NBC News has just obtained the memo explaining why Acting Attorney General Matt Whitaker will not recuse himself from the special counsel investigation.

And Michael Moore is here to respond to the utter chaos that is happening in Washington, D.C. today and what it means for the new Democratic House majority.



REP. TIM RYAN (D), OHIO: You guys are living in the past. And this government is in chaos. It`s in a free fall. The market`s in a free fall, the staffing at the White House is in a free fall.

The secretary of defense is gone. We`re pulling out of Syria. What is going on? You are in charge of the House, Senate and White House. Get a grip and learn how to govern the country.


VELSHI: OK. That was a lot, so joining me now is the man you just saw there, Congressman Tim Ryan, Democrat of Ohio.

Congressman, good to see you.

Let me just put that to you, you got up there and said learn how to govern this country and in theory that`s what members of the House of Representatives and Senate should be doing, but the thing that looks like happened over the last 24 hours was something else. It looked like the president was governed and instructed by other people.

Let`s just listen together to some of these people who had comments on what happened yesterday.


LAURA INGRAHAM: I think that not funding the wall is going to go down as one of the worst things to have happened to this administration. Forget Mueller, the wall, the wall has to be built.

MATT SCHLAPP: The president should veto this bill. This breaks the promise with his supporters.

RUSH LIMBAUGH: It looks like a lot of peoples` worst fears may be realized and that the president is getting ready to cave on getting any money on a wall in a current budget. Trump gets nothing and the Democrats get everything, including control of the House.

ANN COULTER: Trump will -- it`ll just have been a joke presidency who scammed the American people, enraged, you know, amused the populists for a while. But he`ll have no legacy whatsoever.


VELSHI: Laura Ingraham, Matt Schlapp, Rush Limbaugh, Anne Coulter -- Congressman, what do you have to say about that?

RYAN: Well, it sounds like a lot of bad karma washing up on the president`s shore, because, you know, he told the American people he was going to get this wall built. He told his base that that was going to happen, that it was going to solve all of the immigration problems, all of the challenges with security was going to be solved by the wall. And then he told them that Mexico was going to pay for it.

So he`s dealing with the promises that he made, and he`s not keeping now and that`s the reaction that I would expect from those people that have made a career off of making sure that our country gets ground to a halt through the legislative process.

VELSHI: Is it not strange, though, that conservatives who probably would find it hard to find $5 billion in the budget for something, given that part of the promise was Mexico would pay for the wall and that part of the promise is not coming true, would need to reevaluate the idea that we could have border security, you as Democrats should want border security but you don`t have to do it the way the president wants with $5 billion for a wall that nobody has evidence would work better than something that would cost a billion dollars or a billion six.

RYAN: Right. I mean, we all want secure borders but it`s 2018, Ali. We don`t -- you know, we don`t need a wall. We have technology, we have censors, we have electric fences, we have aerostats that could float above. There`s a million different ways with new technology that we could secure the border, not to mention the fact that shouldn`t go unnoticed, 90 percent of the drugs coming into the country come into the port of entry, which means we may need more border patrol there, more dogs, more security in the port of entry.

A wall is silly. When you have Republican senators from border states saying it`s a dumb idea, there`s a good chance that it`s a pretty dumb idea.

VELSHI: I`m not sure how this all went south, because the Senate passed this bill, it was supposed to work and the president said he`s not going to vote for it. I don`t understand. We saw Tim Ryan and Kevin McCarthy go to the White House, supposedly leaders of their party. I don`t know what the president said in there but they caved. They come out and said it`s not going to happen and they walked out.

So, now, what happens over the course of the next 24 hours? Is there something that looks like success, possibly? We know the Senate is not going to pass the bill that the House passed, so what happens?

RYAN: You`re asking the wrong guy. I have no idea what`s happening, and it depends on which TV show the president watched that morning and which analyst or columnist is giving some opinion that will spook him as to losing his base. I mean, I think this whole thing started from Laura Ingraham, and these other people saying that the president was backpedaling.

He got spooked because just yesterday he promised the Senate he would support what`s called a clean continuing resolution, a clean bill to continue to fund the government. He promised the Senate that he was going to support that. He watched a couple of TV shows on Fox this morning, he got spooked, he backpedaled and then he called the Freedom Caucus over, the extreme conservatives and the Republican caucus, got them onboard.

And now, here we are back to fighting for the border wall again. So, to predict what`s possibly going to happen tomorrow, what`s possibly going to be in the president`s head tomorrow is impossible for any logical human being to be able to figure out.

VELSHI: But Chuck Schumer and Nancy Pelosi have said there`s no way Democrats are going along with this proposal to spend $5 billion on a wall. So, what happens? So, if the government shuts down, guys like you are not going to say fine, fine, here`s $5 billion let`s move on.

RYAN: I don`t know. We may have a government shutdown until the Democrats get back in January and then we`re able to get things back up and running and then maybe do back pay to the federal employees who are going to miss out on getting paid. We can make that up once we get in.

That may be what it comes to. I don`t think there`s any deal to be had right now with DACA or with a comprehensive immigration reform. I think that ship has sailed. So we may end up with a government shutdown.

But this is the key point that I made when I talked on the House floor earlier, Republicans control the House, the Senate, and the White House. Their party, Ali, has proven themselves incapable of governing the United States of America. They are too driven by ideologues on the right. They`re too spooked by columnist and people and talking heads like Rush Limbaugh that can get them off course.

The president has no core values, no core vision for the United States of America. He`s on a reality TV show and he`s great at it. He`s great at winning the 24-hour news cycle but he`s terrible at the long-term strategy of the country, which is why you saw Secretary Mattis pick up and leave in February because there`s no long-term strategy for our country. And China has a 50 and 100-year strategy and we`re trying to compete with them and we`re losing.

VELSHI: Congressman Tim Ryan, good to talk to you. Thank you for being with us.

RYAN: Thanks, Ali.

VELSHI: All right. Coming up, even more breaking news tonight. Believe it or not, we now have the letter that tries to explain why Matt Whitaker, this man, is not recusing himself from the Mueller investigation. That`s next.


VELSHI: Tonight, Donald Trump`s Justice Department is in turmoil as NBC News reports that Special Counsel Robert Mueller could submit his report on the Russia investigation to the attorney general as early as mid-February. Now, that could leave Mueller`s report in the hands of Trump`s acting attorney general, Matthew Whitaker, who has repeatedly criticized the Russia investigation.

"The Washington Post" reports that Whitaker declared he would not recuse himself despite a recommendation from a senior Justice Department Ethics official that he should. According to "The Post", Whitaker convened a group of advisers who "disagreed with the ethics determination and recommended to Whitaker the next day not to recuse". That`s interesting.

And tonight, NBC News obtained a copy of the letter sent to Congress explaining Whitaker`s reasons for not recusing himself from the Mueller investigation. Joining me now on the phone, NBC News Intelligence and National Security Reporter Ken Dilanian who obtained that memo. Ken, what`s in it?

KEN DILANIAN, INTELLIGENCE AND NATIONAL SECURITY REPORTER, NBC NEWS: Well, Ali, it essentially articulates the same explanation we`ve been hearing all day from Justice Department officials about what happened here, which is that acting Attorney General Whitaker was advised that he didn`t have a legal obligation to recuse himself.

And, in fact, his statements to the media criticizing the Mueller probe were not sufficient to trigger a formal ethics review. But what he did is he ask for informal advice. And the senior ethics official at the Justice Department told him that it`s a close call but it`s his recommendation he would advise that the acting attorney general should recuse himself because a reasonable person could question his impartiality based on the many statements that he`s made denouncing and prejudging the Mueller probe.

But he declined to take that advice. He`s said he`s going to continue in his role as supervising the Mueller investigation. And as you said, that could mean that when the Mueller report -- if, in fact, the Mueller report does get sent to the attorney general in mid-February when we expect Whitaker will still be in place, he could be the person to decide the fate of that report, whether it becomes public, how it goes to Congress and all those important things.

VELSHI: So I think you said something there that I think is crucial. He could be the person to decide whether or not it goes public. I think this is really important because if that report comes out or gets given to the Justice Department in mid-February, goes to Rod Rosenstein, what are you saying? That Whitaker can put it inside a desk and lock it?

DILANIAN: Well, in theory, he could, Ali. But I know that -- we have reporting that he has told associates that he believes there is a need to make at least some of this public. There will be issues with classified information and grand jury secrecy and it`s not going to be an easy process and it may take a long time. But I think everyone in Washington understands that you can`t just put the Mueller report in a drawer. There`s a public demand to get some answers on this investigation.

VELSHI: Ken, thanks for your great reporting as always. Ken Dilanian.

DILANIAN: Thanks, Ali.

VELSHI: Joining us now is Matt Miller, former spokesman for the Attorney General Eric Holder and an MSNBC contributor. Matt, Ken was speaking about something that I think most of our viewers know but I think it`s worth reminding them of stuff that Matt Whitaker has said. Here`s just one example from July 26, 2017. It`s what he had said about the Mueller report.


MATT WHITAKER: I could see a scenario where Jeff Sessions is replaced with a recess appointment and that attorney general doesn`t fire Bob Mueller but he just reduces the budget so low that his investigation grinds to almost a halt.


VELSHI: Now, what we weren`t clear at the time was that was a -- seemed to be a job interview tape because he`s the guy who replaced Jeff Sessions who could just do the things that he said that Jeff Sessions could do. A reasonable person could surmise that this guy has not only a prejudice against the Mueller investigation but has actually thought out how to stymie it.

MATT MILLER, FORMER SPOKESMAN FOR ATTORNEY GENERAL ERIC HOLDER: Yes, that`s right. And that`s exactly why the Department of Ethics officials I think recommended that he recuse. Look, they tried to dance around what happened in this letter but I think what the Department of Ethics officials recommended is something that`s pretty normal and pretty standard of people that work at the department like I did are used to.

Oftentimes, you will come to Ethics officials with situations and say, "Here are the facts, am I required to recuse here?" And they might come back to say, "Well, no, you don`t have a financial interest. You didn`t represent someone in this matter in a case previously. You weren`t at a law firm, for example, that`s representing them now. So you`re not required to recuse. However, because of the appearance that you`re involved in this matter would present, the doubt it would raise in the public`s mind about the integrity of the Department and your integrity and your ability to carry out this job, we recommend that you recuse."

And I will tell you, in every situation which I was involved and every situation I saw other people involved, they always, a hundred percent of the time, carried out that advice. And I think the fact that Whitaker has not only refused to take that advice but also as you just quoted, you cited from "The Post" story kind of set up this little odd committee which presumably are political to give him different advice, you know, shows that he`s there for a reason.

VELSHI: Let`s think about that. OK. You and I go, there`s some ethics advisor on. This person tells us this is how you would do it. And then you set up this, as you call it, an odd committee. We don`t know who`s on the odd committee, and somehow the odd committee says don`t worry about it, just go on, ignore the ethics advice you were given. This is the acting attorney general of the United States.

MILLER: Yes. And look, the ethics officials are there for a reason because they`re the ones familiar with these rules. They`re the one whose integrity is supposed to be without question. And it is their job to make these recommendations. It`s not the job of people you handpick, political appointees you put in place to make the recommendation.

And you made an important point about how we don`t know their identity. Reporters asked today who are these people that are on this committee. DOJ refused to answer the question. This entire thing is really -- I mean it`s hard to overstate what a kind of open, brazen act of corruption it is for the department of -- for the acting attorney general to get ethics advice to recuse himself from this case and decline to follow it.

And the reason it`s so problematic is we all know why he`s there. We all know his only qualification for this job was his open and publicly stated hostility to the Mueller probe. That`s the reason the president bypassed the entire DOJ line of succession and put him there in the first place.

VELSHI: Let`s talk about that point, the Mueller investigation. We have reporting tonight that Mueller may submit a report to the attorney general as early as mid-February. Now, that`s tricky timing because we don`t know in mid-February who the attorney general is going to be. Is it still going to be the acting Attorney General Matt Whitaker? Is it going to be Bill Barr, the attorney general nominee? Will that be held up and what happens to the report? Give me some thinking on that.

MILLER: That was important reporting from Pete Williams and from Ken. I noted that what they reported is that he is going to submit a report to the attorney general. Now, that`s required under the special counsel regulations. At the end of this process, he`s required to submit some sort of report to the attorney general. That`s not the same as making a report public. It`s not the same as making a report available to Congress.

I think those are still open questions as well as a question that Mueller may find some other way to make information publicly available by say, you know, bringing further indictments and some meetings, making a bunch of information available through the grand jury process. So I think the question now is who`s the acting A.G. going to be or who`s going to be the Senate-confirmed A.G.?

We saw Bill Barr make news today for some -- expressing some views hostile to the investigation as well. And are they going to treat Mueller`s recommendations fairly? If he wants it made public, are they going to listen to it? Are they going to try to put this thing under a rug?

VELSHI: So Matt, what -- both of them, Matt Whitaker and Bill Barr have expressed opinions on the Mueller investigation or at least varying views on whether the president can be subject to prosecution or indictment. For people who think that the Mueller investigation report should be made public and/or the president should face some penalty for anything he may have been found to have done, when is it better that the report come out?

MILLER: You know it would be better that the report come out when Rod Rosenstein who`s been overseeing this probe for some time is allowed to continue it. I don`t think it`s a coincidence that both the acting Attorney General Matt Whitaker and the Attorney General nominee Bill Barr both have expressed hostility to the Mueller investigation. Barr, we just found today did it in a secret memo that he gave to the White House. That`s why those people are in their job and I think it`s why the Senate needs to demand that Barr be recused if he`s confirmed and it will be given back to Rosenstein.

VELSHI: Matt, good to see you as always. Thank you for joining me. Matt Miller.

Coming up, Michael Moore is going to react to today`s news and tell us what he thinks the Democrat`s top priority should be when they take the majority in the U.S. House next month.


VELSHI: What a difference a year makes. One year ago today, Donald Trump was celebrating the passage of a giant tax cut. Remember this photograph? That he claimed against almost every expert opinion would be a huge boost to the economy and to middle-class workers. His treasury secretary claimed that as a result, "the stock market will go up higher". A year later, all major stock indices were down today and for the year by a lot.

The Dow fell almost 500 points today, hitting the lowest levels since October of 2017. In other words, more than a year ago. And as for those huge benefits to workers that Donald Trump promised, well instead companies spent their tax savings this year on record stock buybacks while employee bonuses hardly moved at all.

The economic uncertainty extends far beyond Wall Street. This week, the president announced another $4.9 billion in bailouts to farmers who are still suffering as a result of the Trump trade war. Despite Donald Trump`s claim that he had reached an incredible deal with China as it related to trade. And all of that uncertainty doesn`t even consider the daily White House chaos like the resignation of the defense secretary, abrupt changes in military strategy and a possible third government shutdown this year.

Joining me now Michael Moore, an award-winning -- academy award-winning documentary filmmaker whose latest film, "Fahrenheit 11/9" is now available on DVD, on demand and is the number one documentary film on iTunes. Michael, welcome. You and I share a deep interest in the economic well- being of Americans. They were sold a bill of goods in that tax plan.


VELSHI: And we have not seen any evidence of gain from the president and we careen from one thing to the next and then in 24 hours, we may see a government shutdown.

MOORE: Right. The gain has been for that top 0.1 percent. They have done very well. But I wonder how they`ve been feeling the last 5 to 11 days. When will they decide he`s got to go? That will be the interesting moment I think.

VELSHI: That group has done well for a long time. I`m not sure --

MOORE: And they`re doing even better now, historically better.


MOORE: All the Republicans in that photo that you showed standing there on the steps with him a year ago today all looking so slap happy and all, remember, it`s not just Trump. All of the Republicans, all of them, nobody has had the courage to stand up and say this is wrong, this is un-American. This hurts this country.

This is -- this tax cut in a sense an act of terror because it`s going to be -- the people who are already struggling to get by that much harder to get by. And what are they going to do? What are they going to do? And to alleviate their pain, how many more of those opioid drugs are they going to need? What will happen to their children in their inadequate schools, the air that they`re breathing, the climate change that they say they don`t believe in, all of that?

VELSHI: Because you know very clearly that the opioid epidemic is a by- product. It was bad stuff from pharmaceuticals. It was bad stuff from pain practitioners but it`s an economic outcome.

MOORE: Yes. And it also kills people. The health care system should not be in the hands of people whose goal is to make a profit. That`s their job. In fact, fiduciary responsibility, their shareholders to make as big a profit as possible. So that`s why our health insurance isn`t what it actually should be. It`s why the pharmaceutical companies control all of this.

But I was just watching the stuff with Mattis. I was in the green room back there. And I really -- I think maybe this is the first time I`ve actually been frightened for the country --

VELSHI: Frightened, really?

MOORE: -- in these almost two years. Well --

VELSHI: Because you thought Mattis maybe was the adult in the room. Maybe it was --

MOORE: Well, yes. I don`t like that term because, first of all, yes, OK, all the adults --

VELSHI: The little children?

MOORE: Well, I`ve often said that our only -- the only question we have to resolve about Trump is do we try him as an adult. His behavior, the way he acts and behaves. But, no, what -- basically, everyone on the cabinet who would have voted to remove him under the 25th Amendment eventually, they`re gone. They`re out.

But, no, I think what`s scary about Mattis is that he`s a guy -- this is a guy that isn`t afraid of war. He, Colin Powell, they all went to war for Bush, for Bush One. They all supported Bush Two up to a point. What you have now with Mattis leaving, it means that Trump is going to put in the person that agrees with him and is going to be his dog. He`s going to do what he tells him to do.

We have an autocrat in the White House. Any time you have an autocrat, what do they want, running the military, the person that`s going to do what they tell them to do. We are now with Mattis leaving closer to Trump starting a war because he will have -- just as he`s proven with the two attorney generals that he`s announced since Jeff Sessions, he will find the person who is going to be on his page and does what he tells them to do.

And when that means he just wakes up some morning and decides to go to war with somebody because he`s so random about his behavior, that`s how he does things, we`re going to have a defense secretary that`s going to go, "Yes, boss". And that makes it dangerous for all of us and for the world.

VELSHI: So what would you have done differently? One of the things I thought very interesting tonight was Jim Mattis`s letter of resignation which had not a word of compliment. I mean nobody, virtually nobody resigns without saying something nice.

MOORE: Right.

VELSHI: He didn`t say that. But he had -- he sort of gave a lesson in what America`s leadership in the world needed to look like.

MOORE: It was beautiful. He said all the right things. It`s not what I would have said.

VELSHI: What would you have said?

MOORE: If I were him, I would have looked straight into the camera and said, "I`m not leaving. I can`t leave. I serve the American people. The purpose of my job is actually not to create war, but peace. The purpose of my job is to make sure that our young men and women who are volunteered to be in the military, which means all the rest of us don`t have to go."

They volunteered to go in place of us. They`ve offered to die, if necessary so that you and I don`t have to die. What greater gift could anybody give? So this volunteer army, this volunteer army is now going to have to be told to do what he wants them to do. And if I were Mattis, I would have said, "As the Secretary of Defense, I can`t leave these good soldiers and servicemen. I can`t leave them and I can`t leave the American people."

So I`m not going to resign because I`m here to defend you, the American people. He has to resign. Now, this isn`t a coup. We need a commander in chief elected by the people. This man wasn`t elected by the people. Let`s just say it. He lost by three million votes. He`s got to go. The proud men and women who serve in this military that I am in charge of, we`re not leaving because we`re going to serve you, not ourselves, not him, you.


MOORE: So you, the American people, have to fix it. You have to do it through your representatives. And I won`t leave you to him and the person he`s going to put in here who may take this country to war.

VELSHI: Right. And it`s an interesting concept that last about three minutes until Donald --

MOORE: Well, hopefully then he`ll finish with these words. We saw yesterday with his decision to pull out of Syria doing what his handlers have told him to do.

VELSHI: And let me just point out --

MOORE: -- the Russians.

VELSHI: I just want to put up one of many tweets from Donald Trump where he says, "Does the USA want to be the police man of the Middle East getting nothing but spending precious lives and trillions of dollars protecting others who, in almost all cases, do not appreciate what we`re doing? Do we want to be there forever? Time for others to finally fight. Russia, Iran, Syria, and many others are not happy about the U.S. leaving despite what the fake news says, because now they will have to fight ISIS and others, whom they hate." It goes on. Vladimir Putin today in public on television talked about how happy he was that America was going --

MOORE: Correct.

VELSHI: Donald Trump lies and lies and lies. But somebody believes him.


VELSHI: Somebody believes these --

MOORE: Let me just say -- let me tell you when he does tell the truth. He actually put Russia in that tweet. He`s actually admitting it. He has learned and he started this here in New York for 30 or 40 years as a businessman. He learned that if he did all of his crimes out in the open in public, that that`s the way to get away with it. And so he just says it right there.

He said, "I could shoot somebody in the middle of Fifth Avenue and get away with it." That wasn`t a lie. I think that`s the truth. And I think there have been many truths he`s been trying to tell us and I think we all better wake up and have him legally, non-violently removed from office.

VELSHI: When we discuss all that has happened, I mean just the list, just today, Syria, the House possibly --the government shutting down possibly tomorrow night, the stock market, all of these different things. And we talk about how the wheels are coming off and people say the wheels are coming off. And guys like Mattis leaving sort of indicate some of that.

In the end, despite the fact that Donald Trump got fewer votes than Hillary Clinton did, our system in this country allowed him to win an election. Do enough people think this is chaos? Do enough people think this is dangerous and scary as you do?

MOORE: I think so. I think this -- I think people`s minds tonight after these last couple of days have -- are just -- I think people`s heads are spinning in a Linda Blair exorcist kind of way where we just cannot -- when it spins back around, you`ve got to come to the conclusion this can`t continue another day, another week. What are we going to do about it? You mentioned the electoral college, that`s why he`s there.

VELSHI: January -- correct.


VELSHI: Are we fixing the electoral college?

MOORE: Well, it has to be removed. And here who is really responsible for this is the Democrats. In 2000, when Al Gore won the presidency by a half a million votes, that`s when -- when he wasn`t allowed to enter the White House, the American people should have risen up and removed the electoral college. And we didn`t and we let it -- and it happened again 16 years later with Hillary Clinton winning by a large margin and, boom, she doesn`t get to take her seat in the White.

Do you think for a minute if Donald Trump had won the popular vote that he would just go, "Oh, well, it`s OK, I didn`t win the electoral college"? No, I don`t think so. You heard what he said before the election.

VELSHI: You and I have talked about health care a lot. You know I like the Canadian health care system.

MOORE: Yes. Why would that be, Ali?

VELSHI: It covers everybody and it doesn`t cost us.

MOORE: And you might have maybe grown up there?

VELSHI: I grew up there.

MOORE: And you got to see a doctor and your parents didn`t lose their house.

VELSHI: Correct.

MOORE: If you have had --

VELSHI: My father had a stent. It cost him the amount that had cost the park at the hospital to get a stent. So the bottom line is most American people think that`s the most important thing. It was actually the biggest concern --

MOORE: That`s right.

VELSHI: -- on the ballot.

MOORE: That`s right.

VELSHI: That remains the best possibility quite possibly for Democrats to campaign on and to ensure Americans that things like that need to get fixed.

MOORE: Yes. And the new class that`s coming into Congress, so many people came out. We had a record, you know, the young people, 18 to 29-year-olds. Twenty-one percent came out in 2014 during the midterms. Thirty-one percent came out in this midterm. I mean it is an amazing statistic.

They have to see these Democrats in this Congress in these next two years do something, stand up for something, get out there and do the job that needs to be done. Yes, the Senate won`t pass their vills but there are other ways, smarter ways than the way Republicans handled Obama to get out there and show that they`re fighting for the people. If they become just politicians and just say the same old things. Those people who came out in November, who hadn`t voted in a while, they`re going to stay home in 2020. Then, that will be Trump`s victory.

So we have to make sure that this Congress stands up for the things that they`re supposed to stand up for, what people sent them to Washington to do, to do what Alexandria Ocasio-Cortez or Rashida Talib and others, fight for these things. This is our hope and this cannot continue. You call this chaos and the wheels going off? The wheels have been off for some time. And we are heading toward the cliff.

VELSHI: Michael Moore gets tonight`s last word.