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New Dem House Majority votes. TRANSCRIPT: 1/3/2019, The Last Word w. Lawrence O'Donnell.

Guests: Ron Klain, David Jolly

Show: THE LAST WORD WITH LAWRENCE O`DONNELL Date: January 3, 2019 Guest: Ron Klain, David Jolly


And the fascinating detail within those votes that I`m looking at now is that seven Republicans in the House of Representatives voted for the package of funding bills that Nancy Pelosi put together that had nothing to do with the border wall. And five Republicans voted for the other bill that would temporarily extend funding for the Department of Homeland Security without a border wall. So there`s five Republicans in the house of representatives tonight who were perfectly happy to not only go without the wall but vote in effect against the wall very specifically tonight.

RACHEL MADDOW, MSNBC HOST, "TRMS": Yes, and as Hakeem Jeffries just said live on-air just moments ago, as these bills now head to the Senate, what the House has sent to the Senate are two bills that the Senate has been very, very happy to not only support but act on and vote for in the past with absolutely no controversy on either side of the aisle. So this is calling the question in terms of whether or not the border wall is the thing that Republicans in the Senate want to be known for in terms of keeping the government shutdown. This absolutely eliminates all other variables and puts them on them.

O`DONNELL: Rachel, for this and other reasons this next hour is going to proceed with a theme, and it`s something I have stolen from a headline in "The New York Times" today which is that 2019 will be the worst year of Donald Trump`s life. And we are going to carry that through the hour on several different fronts.

MADDOW: You know, didn`t everybody have a terrible 7th grade, though? Do we really know -- I mean --

O`DONNELL: We have a feeling he didn`t. We just have a feeling he didn`t.

MADDOW: Fair enough.

O`DONNELL: There`s something that feels a little spoiled in this background. I don`t know. I may be a little overreaching there.

MADDOW: We say adult life.

O`DONNELL: Yes, adult life. It`s going to be like the year of the unindicted conspirator and individual one and Stormy Daniels. That`s going to be like the good old times for him by Valentine`s Day, I think. That`s the theory for the next hour.

MADDOW: I`m staying here for it. Thank you, my friend.

O`DONNELL: Thank you, Rachel.

MADDOW: Good night.

O`DONNELL: Well, as I said, 2019 will be the worst year of Donald Trump`s life. That is the headline that greeted the third year of the presidency in "The Los Angeles Times" today. An op-ed piece compares Donald Trump`s 2019 to Richard Nixon`s 1974, the year the special prosecutor`s investigation of the president forced Richard Nixon to resign the presidency.

And that article compares Donald Trump`s 2019 to Bill Clinton`s 1999 after being impeached by the House of Representatives, Bill Clinton survived an impeachment trial in the United States Senate.

2019 will probably be the year when we discover whether the president can be indicted by special prosecutor Robert Mueller. And if Donald Trump is removed from office, the Vice President becomes president and the next person in the line of succession to the presidency is now Speaker of the House Nancy Pelosi who began this historic day on which she resumed the speakership answering this question from NBC`s Savannah Guthrie.


SAVANNAH GUTHRIE, NBC NEWS ANCHOR: Do you believe the special counsel should honor and observe the Department of Justice guidance that states a sitting president cannot be indicted?

REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: I do not think that is conclusive. No, I do not.

GUTHRIE: Can Robert Mueller come back and say I`m seeking indictment?

PELOSI: I think that is an open discussion. I think that is an open discussion in terms of the wall.


O`DONNELL: Donald Trump has gone from a speaker of the house who did everything he could to help Devin Nunes, the chair of the House Intelligence Committee, obstruct a legitimate investigation of Donald Trump to a speaker of the House who is encouraging the new Democratic chairs of House committees to do their duty to investigate the president and who believes it is possible that the president can be indicted.

Nancy Pelosi has gone from discouraging talk of impeachment during the congressional campaigns to allowing one of the senior Democrats in her own California congressional delegation to introduce articles of impeachment in the House of Representatives against President Trump today.

We will be joined later in this hour by California Congressman Eric Swalwell who`s a member of the House Judiciary Committee which has jurisdiction over the impeachment process. We will get his view of what now seems truly to be the worst year of Donald Trump`s life. This worst year of Donald Trump`s life has begun with one of the most difficult problems a president can possibly face, a government shutdown and Donald Trump is the very first president in history to publicly blame himself for the shutdown.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I will be the one to shut it down. I`m not going to blame you for it.


O`DONNELL: Tonight is the first time in Donald Trump`s life as president that he has watched the House of Representatives do something that he did not want them to do. As Rachel reported at the beginning of this hour, Nancy Pelosi pushed legislation through the house tonight to reopen the government. In normal times, Republicans would vote for the Pelosi legislation because they voted for it already. She passed six spending bills tonight that have already been agreed to by Senate Democrats and Senate Republicans, bills that have nothing to do with the border wall that President Trump wants.

Speaker Pelosi suddenly pushed through the House a bill to extend funding for homeland security at its current levels temporarily for a month that would allow the president and Congress to continue to struggle over the Trump border wall without the government being shutdown. Nancy Pelosi has no doubt about her position on the border wall.


GUTHRIE: Are you willing to come up and give him some of this money for the wall?


GUTHRIE: Because apparently that`s the sticking point.

PELOSI: No. Nothing for the -- we`re talking about border security.

GUTHRIE: Nothing for the wall, but that means it`s a nonstarter.

PELOSI: We can go through this back and forth. No. How many more times can we say no? Nothing for the wall.


O`DONNELL: Speaker Pelosi`s negotiating hand has only been strengthened by the blue wave that has shift Democrats into the majority in the Congress, and includes among the freshman members of the Democratic House, some of the strongest opponents of the border wall, including the already most famous member of the freshman class, Congresswoman Alexandria Ocasio- Cortez, who cast her first vote in the House today in favor of Nancy Pelosi for speaker of the House.






O`DONNELL: She was the only one who voted for Nancy Pelosi who got any kind of reaction from Republicans. She is in complete control of those Republicans and commanding their attention and in swatting away their insults.

Moments later, at her swearing in, Speaker Pelosi in her acceptance speech of the speakership announced her legislative strategy for the shutdown.


PELOSI: We will debate in advance good ideas no matter where they come from, and in that spirit, Democrats will be offering the Senate Republican appropriations legislation to reopen government later today.



O`DONNELL: Joining our discussion now, Joy Reid, MSNBC national correspondent and the host of "A.M. JOY" weekends on MSNBC. Joy will have a special town hall event at this very hour tomorrow night with Nancy Pelosi right here on MSNBC at 10:00 p.m. And we are also joined tonight by Michelle Goldberg, "New York Times" columnist and MSNBC contributor.

And, Joy Reid, a very impressive day one for Nancy Pelosi. And what may be -- what may very well be basically a day one of the worst year of Donald Trump`s life.

JOY REID, MSNBC NATIONAL CORRESPONDENT: You know, it`s interesting, Lawrence, and you know this better than most that I think a lot of people sometimes forget because we`ve had an era of speakers who deferred, to put it the most kind way, to the president of the United States. You had Paul Ryan who did that, and you also had speakers who were very challenged by members of their own caucus who made it very difficult for them to do their job -- John Boehner.

But I think people forget how powerful the speaker of the House is. As you say, this is the person who is next in line to the presidency after the president and vice president. And Nancy Pelosi in taking the speakership a second time, really harkening back to powerful speakers, people like Tip O`Neill, this is an incredibly powerful position. It`s an incredibly powerful position particularly when it`s an adversarial position to the president, think Newt Gingrich.

Nancy Pelosi came in and reminded the people listening to her give her acceptance speech and in Article I of the Constitution. And in Article I Section 7 Clause 1 of the Constitution, it says all bills for raising revenue shall originate in the House of Representatives, but the Senate may propose or concur with amendments.

This is where spending comes from. If Donald Trump wants money for a wall, it has to go through Nancy Pelosi. There`s no other way around it. So, he is now negotiating with a woman who has a masterful counter, who done this job before, and who knows government as well as he has ignored the rudiments of government, the workings of government.

So, this is going to be a really tough sled for Donald Trump.

O`DONNELL: Michelle Goldberg, you know, as a kid growing up in Boston, I grew up through two Boston speakers of the House, John McCormick, and then Tip O`Neill, and one Boston president, John Kennedy. And most politicians in Boston when they needed something, they always went to John McCormick or they went to Tip O`Neill, that`s where the power is.

We could do an hour on how powerful that position is. It`s one of the reasons why during the president`s campaign, when I thought Donald Trump was not going to be president, I would occasionally say, you know, when he attacks Paul Ryan, he attacks the speaker of the House, if he ever became president, he would discover how much power the speaker has over him, and I was so wrong about that because of the collapse of so many things, including apparently the collapse of male ego, which might be a good thing in Washington.

But Paul Ryan as speaker used none of his power in relation to this president. So this president two years in has no idea what the powers of the speakership are.

MICHELLE GOLDBERG, MSNBC CONTRIBUTOR: And think how frustrated Donald Trump has been just by the very rudimentary constraints that he`s already faced, right? That he can`t go by fiat, that he basically has to at least, you know, pretend to abide by the laws of the land, right. That he`s in some respects checked by the Supreme Court.

He`s had these very minor constraints on what he imagined was a kind of legal authority, and it`s driven him bonkers. And so, now, he`s going to have both nonstop investigations and an inability to really get anything substantive done, unless he is able to negotiate with Nancy Pelosi, who despite his ridiculous reputation as a master negotiator, he has nothing on her. He has no experience commensurate with hers.

O`DONNELL: Joy, tomorrow, when you get to Speaker Pelosi about this, what do you intend to begin with her?

REID: Well, I think obviously, we have to start with the situation we have now, the shutdown, because the impasse is complete. Donald Trump says he wants $5.5 billion for a wall that he previously said Mexico would supply all of the funding for. Nancy Pelosi said to our own colleague, Savannah Guthrie, no money, zero, you get nothing for the wall.

So, that is the ultimate impasse, and now you have the Senate majority leader who has said he will only put on the floor a bill that Donald Trump has already affirmed that he supports, which is an incredible diminution of his own power, because this can easily be solved if these Senate majority leaders said, fine, Speaker Pelosi has now passed six bills and we will simply repass the same bills that we passed before, these were our bill, right, from the previous Senate, and be done with it and let Trump veto it or not.

But, you know, it`s incredible to me, I don`t know if it`s you too, Lawrence, we`ve entered an era of no vetoes, where Congress doesn`t even low the president to exercise the constitutional power of the veto. They won`t even let him do it. They say if he`s already for it, Mitch McConnell who`s already supposed to be a powerful man, has said, I won`t do anything unless Donald Trump says I can.

That`s extraordinary because the Constitution was designed to have each of these bodies jealousy guard their power. And I just think Americans are not accustomed to that jealous guarding of power. We`re going to get accustomed to it now, because the new speaker of the House is going to guard the use of power. I think what we`re going to start is to talk about the way she intends to use her power.

O`DONNELL: And, Michelle, I do want to pause and reflect over this historic moment. Here we are as Nancy Pelosi herself pointed out today, 100 years away from women getting the right to vote in this country. And we have a woman speaker for the second time, the same woman. And we have many more women members of Congress and women members of the Senate we`ve ever had before but we`re still not at 50/50. We`re not close to 50/50.

And one of the measures we`re looking at in those 100 years is how long it takes a denied population to catch up once you open the door.

GOLDBERG: I mean, it was so striking the side by side visuals. Like you said, it`s not a parody, but it`s still a freshman class on the Democratic side unlike anything we`ve ever had before. So you had this panorama of America, all of these incredibly inspiring stories. These first -- you know, it was the sort of America that a lot of us had thought that we lost when Donald Trump became president.

And then you have, you know, not just this overwhelmingly white male older Republican caucus but Donald Trump trying to steal some of Nancy Pelosi`s power by giving this sort of ridiculous address to the press, backed by four identical bald clones in the White House briefing room, right? It`s hard to imagine a starker representation of two different Americas.

And I also have to say, you know, that this is the first time that I actually felt like maybe something good has come out of the calamity of Donald Trump`s presidency, right? Because he didn`t, you know, build his wall, and he`s not going to accomplish most of what he set out to accomplish. But he did build that. I don`t think a lot of those people in the Democratic side would have run, would have given up the lives they had lived before they entered into politics had not this kind of national emergency with his election.

O`DONNELL: Joy, I want to get your reaction to what you saw on the House floor today.

REID: You know, it`s extraordinary. Nancy Pelosi prioritized children. There was an amazing moment where she brought not only her grandchildren but all the children in the gallery up to stand with her as she took the oath of office, as she raised her right hand.

And I think she was at that moment giving you sort of the both sides of the spectrum of what women bring to power. She`s obviously somebody not embarrassed about seeking and pursuing power. She`s not embarrassed to wield power, but she also is still a grandmother. She`s also still a woman who cares about children, has a nurturing side and isn`t embarrassed to show it.

And I think for a lot of women in trying to figure out how do you balance, how do you field authority, whether political authority, authority in the business world, that is the balance. How much of each of those two sides of yourself do you bring to the table? Because Donald Trump as Michelle said is not accustomed to deal with a powerful equal, particularly a woman who`s a powerful equal.

This is going to be an extraordinary education for him. I think he`s going to learn a huge civics lesson. He`s never had a board of directors. But now he`s got a woman who`s as much a CEO as he is. And it`s going to be interesting to see how he navigates a world in which Nancy Pelosi is a boss.

O`DONNELL: Speaker Nancy Pelosi with Joy Reid is going to be the show tomorrow. You can watch Joy Reid moderated town hall right here on MSNBC with Speaker Nancy Pelosi at 10:00 p.m., right here tomorrow night.

Joy Reid, Michelle Goldberg, thank you both for starting us off tonight. I really appreciate it.

Congressman Eric Swalwell is going to join us coming up. And also, Senator Chuck Schumer says the pressure in the shutdown is now on Republican senators who are up for re-election next year. And two of those Republican senators have already defected from the Republican position on the shutdown.

And another part of the worst year of Donald Trump`s life looks like it`s going to be the stock market and possibly the economy. That`s coming up.


O`DONNELL: Breaking news on the night is that Nancy Pelosi-led House of Representatives has quickly passed a package of legislation to reopen the federal government. One of the bills is temporary funding bill for the department of homeland security that would allow the president and Congress to negotiate how the full funding for homeland security this year will include the border wall that Donald Trump promised Mexico would happily pay for.

In addition to that, Speaker Pelosi pushed through six spending bills that would fully fund the rest of the fiscal year, the parts of the government that have been shutdown by President Trump after he reversed his position and withdrew his support for those very same spending bills. Last month, Senate Democrats and Senate Republicans unanimously voted for essentially the same package of legislation.

The House passed bills, now go to the Senate where Majority Leader Mitch McConnell has said he does not intend to bring any bill Tuesday a vote that President Trump has not agreed already to sign. But President Trump`s promise to sign legislation has no meaning and Mitch McConnell knows that since the president already promised to sign this legislation last month, and then withdrew that promise after Mitch McConnell and the Senate unanimously passed that legislation.

The Senate`s Democratic Leader Chuck Schumer now thinks the pressure is on Trump and McConnell in the Senate.


SEN. CHUCK SCHUMER (D-NY), SENATE MINORITY LEADER: It puts a lot of pressure not only Trump but on Leader McConnell. And remember, it`s not like last session when we had all these vulnerable Democrats who were up for re-election. Now, they have a bunch of vulnerable Republicans up for re-election. Republicans in the Senate will realize that it`s hurting them, hurting them, hurting them, and they will say we want this. They will go to McConnell and McConnell will say, look, we`ve got to make some kind of agreement.


O`DONNELL: The Pelosi Schumer strategy already seems to be working. Two Republicans, Cory Gardner of Colorado and Susan Collins of Maine, have both said they support the funding bills. Both of them are up for re-election next year in states that Hillary Clinton won in 2016. And so, the worst year of President Trump`s life legislatively has begun with at least two defections from the Republican ranks in the United States Senate.

Joining our discussion now, Ron Klain, former senior adviser to Joe Biden and President Obama, the former chief counsel for the Senate Judiciary Committee. Also with us, former Republican Congressman David Jolly from Florida.

And, David Jolly, I want to start with you because in the House tonight, we had a total of seven Republican defections, seven Republicans voted for that package of spending bills, the six spending bills that had nothing to do with border security. Five of them voted for that temporary funding of the Department of Homeland Security while the border security issue gets argued about.

What do you make of that total of seven defections from Republicans in the House tonight?

DAVID JOLLY, FORMER REPUBLICAN FLORIDA CONGRESSMAN: Look, it`s interesting on day one because Nancy Pelosi and House Democrats did the right thing. And so, there are fewer Republican moderates in the House as a result of many of the losses on November 6th. But what we saw there are still Republicans who know opening the government and reaching consensus on something that`s already been agreed to is the right way forward.

But, Lawrence, I will tell you, Chuck Schumer, spot on, they are triangulating Mitch McConnell. And the story this week and the next two years is going to be a Mitch McConnell dynamic, because, often, particularly in shutdowns, is the person that seems least reasonable that often loses shutdowns politically.

In this case, there`s no reason Mitch McConnell should not allow a vote on something the Senate has already agreed to. He is protecting the president with whom he really doesn`t have a pure alliance. It`s more an alliance of convenience.

And so, if Mitch McConnell`s going to spend the next two years being the wall that protects Donald Trump, he needs to be very careful because we know what happens when Donald Trump decides to turn on you.

O`DONNELL: Ron Klain, I want to read you the statements of Senator Collins and Senator Gardner, because as a Senate expert, I think you`re going to know exactly what they`re saying here, as well anyone out there in the audience.

Susan Collins, very much as Chuck Schumer predicted, has put out a written statement saying, my goal is to get government reopened as fast as possible and six of those bills we`ve got agreements on. And so, I`d like those bills signed into law. That`s Susan Collins defecting from Donald Trump and Mitch McConnell.

Here`s Cory Gardner, a Republican senator, saying, I do not think shutting down the government is ever the right answer. We should pass bipartisan appropriations bills that includes money for border security, while we continue to fight for more border security money.

Ron Klain, where does this go in the Senate?

RON KLAIN, FORMER CHIEF COUNSEL, SENATE JUDICIARY COMMITTEE: Well, I mean, I think David Jolly was exactly right here, that the wagons are circling around Mitch McConnell and not in a good way. He`s got 53 senators, he`s lost two. That means he can only lose two more. And we`re really at day zero of this controversy.

They just passed the bill in the last hour. I think the pressure is going to build. A bipartisan solution. Democrats and the handful of Republicans in the House said, let`s reopen the government this way. This bill has passed the Senate unanimously, Democrats, Republicans, together in the Senate, and now really just two men stand in the way of reopening the government, Mitch McConnell and Donald Trump.

And let me tell you something, Lawrence, the wall they should be worried about is not a the wall at the south border, but Wall Street where we had another gigantic drop today in where the last thing that`s underpinning Trump`s survival here, which is strong economic results is starting to move towards recession. If that turns, it`s a collapse for Trump, a collapse for Republicans on Capitol Hill.

O`DONNELL: Now, David Jolly, consider Mitt Romney who has a former governor -- I know governors when they`re out there in the country and 50 states watching government shutdowns in Washington, they shake their heads, they cannot believe that it ever happens because it basically can`t really happen in a state government.

So, here`s Mitt Romney facing his first government shutdown, and what does he do about it? And one of the first things he`s going to read about it is his colleague western Senator Cory Gardner, Republican senator like Mitt Romney from Utah, saying I don`t think shutting down the government is ever the right answer.

If Mitt Romney just takes that one sentence to heart, I don`t think it`s ever the right answer, he will with ease move into the Susan Collins-Cory Gardner column here.

JOLLY: That`s right. And this is where the Senate may break. It`s a very different dynamic, as you and Ron know in the House. Look, the House has been the lapdog for Donald Trump for the past two years, House Republicans. But it`s to be expected politically.

The Senate, though, always tries to posture itself as really an independent body that`s above some of these issues. They each think of themselves as presidents themselves. And so, to be playing a foil and fee be a lapdog to Donald Trump is not going to play well with very individual senators like Mitt Romney.

Frankly, Rick Scott from the state of Florida, is he really going to be a lapdog of Donald Trump or not, considering the fact that Donald Trump keeps moving the goal posts? I mean they`re going into battle with a general, if you will, who keeps moving the goal posts in the middle of the battle and he`s going to leave all these senators out on the field and politically vulnerable, which is why you`re seeing Gardner and Collins. I think you`re going to see others begin to say, we can`t stick with you, Mr. President.

O`DONNELL: And, Ron, we know strategically as we all do in this discussion that the one thing that the leaders in the House, leaders in the Senate need to do in this kind of situation is hold onto every one of their members in any vote. Nancy Pelosi did that tonight. Kevin McCarthy did not. He lost seven Republicans on the first test vote of the shutdown.

That means on the next one, he is more likely to lose more of them because those seven defections gives strength to any others who are considering defecting.

KLAIN: Lawrence, it`s an amazing thing to see. You and I both worked in the Senate. We`re used to the fact that the Democrats are the party of defections, that Democratic leaders have to desperately hang onto their members. Nancy Pelosi got every single Democrat to vote with her tonight. Kevin McCarthy lost Republican votes.

And that`s a new order on Capitol Hill. It shows how strong Speaker Pelosi is in her party. It shows how united Democrats are facing down Donald Trump. And the problems of Republicans in the House and in the Senate are going to face.

And I think, you know, Speaker Pelosi has to call the president tomorrow and say, hey, you want funding for the wall, call the speaker of the Mexican parliament because you promised they would pay for the damn thing, and let them pay for the wall, let`s get the government open.

O`DONNELL: Mexico will pay for the wall will be my negotiating position in any discussion with Donald Trump about that wall.

Ron Klain, David Jolly, thank you both for joining us tonight. Really appreciate it.

And coming up, we have a new member of the new Democratic majority in the House. Congressman Eric Swalwell will join us to discuss impeachment and what promises to be Donald Trump`s worst year ever.


LAWRENCE O`DONNELL, HOST, THE LAST WORD WITH LAWRENCE O`DONNELL: The worst part of what will surely be the worst year of Donald Trump`s life will probably occur in the House Judiciary Committee which has jurisdiction over the impeachment process.

During the congressional campaigns, Nancy Pelosi discouraged talk of impeachment, but she did not do that today when NBC`s Savannah Guthrie asked her about impeachment.


SAVANNAH GUTHRIE, ANCHOR, NBC NEWS: You`ve said it would be sad and divisive for the country to pursue impeachment. Are you willing to rule it out?

NANCY PELOSI, SPEAKER OF THE HOUSE OF REPRESENTATIVES: Well, we have to wait and see what happens with the Mueller report. We shouldn`t be impeaching for a political reason, and we shouldn`t avoid impeachment for a political reason. So we just have to see how it comes.


O`DONNELL: And today, on the first day of the 116th Congress, a senior Democrat in Nancy Pelosi`s own California delegation, Brad Sherman introduced Articles of Impeachment against Donald Trump for obstruction of justice in the firing of James Comey, which Congressman Sherman says was done to impede and interfere with the FBI investigation of the President, his administration and his campaign.

Republicans are gearing up apparently for possible impeachment proceedings in the House Judiciary Committee. Axios reports that Republicans on the committee are seeking an investigative counsel, an attorney with several years of investigative or litigation experience.

Joining our discussion now, Democratic Congressman Eric Swalwell of California. He`s a member of the House Judiciary Committee and the House Intelligence Committee. Congressman Swalwell, thank you very much for joining us tonight.

I think we all saw you, by the way, on the House floor today with your new baby. There we are. What`s the baby`s name?

ERIC SWALWELL, U.S. CONGRESSMAN, CALIFORNIA, DEMOCRAT: Cricket, and I wanted her to see Nancy Pelosi sworn in as a woman, so the first woman Speaker sworn in again. So for my daughter to see that, it was very, very special.

O`DONNELL: Let`s hope she sees many more. I want to get your reaction today to the Speaker`s comments about impeachment, which sounds like a change of tone from what she was saying during the campaign.

SWALWELL: Well, Donald Trump is either going to be impeached by the Congress or impeached at the ballot box. It`s really a race as to which one will happen first. I think for the sake of democracy, just as Speaker Pelosi said, I`d rather see it done at the ballot box, but we`re not going to shirk our responsibility and give him the Presidential immunity he has enjoyed.

Lawrence, also if this was Donald Trump justice, Donald Trump would already be impeached by now because he makes wild accusations, rushes to judgment, doesn`t rely on any evidence.

That`s not what`s going to happen. We`re going to look at the Mueller report. We are going to look at the emoluments clause. We are going to look at these other abuses of power. And if there is evidence, we`re going to follow it. We are going to, you know, run it down, but together an airtight case and seek bipartisan buy in.

O`DONNELL: And Congressman, what do you believe are the central - should be the central focuses of investigations of the President and his administration that you in the House are now empowered to carry out?

SWALWELL: I would say first how they impact every day Americans. So, you know, what he`s done at the Department of Justice to not enforce the requirement that, you know, you can`t be charged more for a pre-existing condition by an insurance company - that affects every day Americans, but also the rule of law.

We all have to follow the law. No one is above it, and that certainly applies to the President. So making sure that he, too, is not above it in the way that he has fired his investigator, or the way he`s tried to pick his judges, the way that he`s tried to get rid of his Attorney General or put in place an Attorney General that would try and end the Mueller investigation.

So I think it`s really explaining to the American people that investigations matter whether it`s upholding the Constitution, the rule of law or issues that affect them at their kitchen table.

O`DONNELL: Congressman Neal who is going to be the Chairman of the House Ways and Means Committee apparently intends to introduce a bill that will require presidential candidates to release ten years of tax returns and Ron Wideman in the Senate wants to introduce a companion bill requiring presidential candidates to release ten years of tax returns.

You might be a presidential candidate. You`ve talked about exploring that. Is that something you would support, releasing ten years of tax returns?

SWALWELL: It is something I would support, Lawrence. And for me it would mean just going back to my turbo tax releases for most of the time I have been in Congress until I got married and my wife said, I think it`s time that we get an accountant.

But I do think that the American people should see any candidate`s taxes. I think you need to know if a candidate for President has conflicts of interests and if those interests are contradictory to American values. So transparency, I think should win out here.

O`DONNELL: Now, obviously that`s a bill that would affect all Democratic candidates. It`s interesting to note, by the way that Chairman Neal is from Massachusetts and his senior senator Elizabeth Warren who is running for President has already released ten years of tax returns.

But when I think when people hear that, they think about it as being aimed at Donald Trump who has not released any tax returns and do you think there could be Republican support for that bill? Or will they try to protect the President from having to release tax returns?

SWALWELL: Lawrence, I`m afraid that most of them overwhelmingly will seek to protect the President, and that`s disappointing, but they have gone out of their way to take out the shovels, bury all of the evidence that we`ve seen in many of these investigations to protect the President; and I expect that even if it was in the interest of the country and even if it meant that multiple billionaire Democratic candidates for President would have to disclose their taxes, I think Republicans will do anything right now to shield Donald Trump from lawful investigation.

O`DONNELL: Let me just get a quick word from you about the seven Republicans who defected from the Republican position on the House floor tonight in voting to reopen the government, is that the beginning of what could be more defections in the House?

SWALWELL: It was the right thing to do, Lawrence. It was a bipartisan vote, and it was actually a vote that had already passed 100-0 with Republican and Democratic support in the Senate and I expect there`s going to be more votes like that. And most Americans at home ask me all the time in my district, why isn`t there a vote in Congress on the DREAM Act, on background checks, on infrastructure when there`s consensus among the American people?

And that`s because for the last eight years, Republicans have just prevented those votes from coming forward. And so now, Republican members will get an opportunity to vote on issues like this. And I think you`ll see more bipartisanship in this new 116th Congress.

O`DONNELL: Congressman Eric Swalwell, thank you for joining us on this important night. Really appreciate it.

SWALWELL: My pleasure. Thanks, Lawrence.

O`DONNELL: Anytime, thank you. And when we come back, the stock market got worse today for investors and for President Trump, and so the worst year of Donald Trump`s life could include Wall Street turning against him, as the national debt and deficit continue to grow and the Trump tariffs continue to hurt American consumers.


O`DONNELL: Here is what President Trump did not say today about the stock market. You`ve got that? This is what President Trump did not say today about the stock market.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Every day for the last long period of days, the stock market, meaning companies, have been hitting new highs.

We`re very proud of our stock market, what`s happened since I became President.

The stock market reached yet another all-time in history, all-time high today.

Have you all been helped? I think so.


O`DONNELL: Well, you weren`t helped today. Today, the stock market closed lower again. The Dow Jones average was down 660 points. If you are a schoolteacher or a nurse with a retirement fund that`s invested in a broad base of stocks as most retirement funds are, you lost money today and you lost some real money in 2018 in what was the worst performance by the stock market in ten years.

Toward the end of the first year of the Trump presidency, Donald Trump actually said the reason our stock market is so successful is because of me. He has not said that about the stock market going down for the last year.

But today, the President tweeted some economical eyes to try to make his voters feel better. He said, "The United States Treasury has taken in many billions of dollars from the tariffs we are charging China and other countries that have not treated us fairly." We are not charging China anything in tariffs. China and no other foreign country ever pays an American tariff.

American tariffs are sales taxes imposed in America and paid by Americans. American companies that buy imported goods and American consumers that buy imported goods. That is why when Donald Trump imposed tariffs on washing machines made in China, the price of washing machines in America went up. And you didn`t see the word tariff on your bill.

When you purchased your new washing machine, but the American company that imported that washing machine and then sold it to you already paid the Trump tariff to the United States Treasury for your washing machine. And then increased the price of your washing machine to you so that you then paid the importing company for the Trump tariff that they already paid to the Treasury.

The Trump tariffs are collecting American money from Americans. Not one penny of Trump tariff money that has gone into the United States` Treasury was paid by China and never will be.

One of wall street`s favorite stocks of all-time, Apple shocked investors this week and created more downward momentum for the stock market by announcing that for the first time in 16 years, the company is reducing its estimate of how much money it will make this quarter because of the Trump tariffs.

And Kevin Hassett, the Chairman of the President`s Council of Economic Advisers said today, quote, "It`s not going to be just Apple, I think that there are a heck of a lot of U.S. companies that have a lot of sales in China that are basically going to be watching their earnings be downgraded next year."

And so after the huge increase in the deficit and the national debt created by the Trump tax cuts and after the increased costs imposed on Americans by the Trump tariffs and the business losses imposed on American farmers by the Trump tariffs and the worst year in the stock market in ten years after the very worst December in the stock market since the Great Depression of the 1930s, will the economic news for Donald Trump be even worse this year in 2019? Will the Trump economic policies make the worst year of Donald Trump`s life even worse?

Jared Bernstein will join us with that, next.


O`DONNELL: So, will Donald Trump lose his bragging points about the economy in what will surely be the worst year of Donald Trump`s life? Nobel Prize winning economist and "The New York Times" columnist Paul Krugman issued a series of tweets tonight saying "Everyone is focused on the political news as they should be, but there is some important economic news, too, and not just the market having another fainting spell. It`s becoming clear that the Trump boom, such as it was, is over."

"Nowcasts of fourth quarter growth suggests that it was around 2.5%, not much above trend."

"Very recent data and leading indicators suggest a significant slowdown currently underway, not a recession, but growth probably under 2%."

"All this suggests that the growth spurt in the second and third quarters was no more durable and less impressive than the growth spurt in mid-2014, which I don`t remember anyone hailing as an Obama boom.:

Joining our discussion now, Jared Bernstein, senior fellow at the Center on Budget and Policy Priorities and a former chief economist to Vice-President Biden, and back with us is Ron Klain.

Jared, your reaction to Paul Krugman`s points with where we might be headed with the economy and what the Trump tariffs might be doing to nudge us there.

JARED BERNSTEIN, SENIOR FELLOW, CENTER ON BUDGET AND POLICY PRIORITIES: I`m in full agreement with Paul`s assessment there. And in fact, one of the things I`ve been writing a lot about lately is as the fiscal stimulus from the tax cuts and some of the deficit spending that the last Congress did begin to fade later this year.

Growth is going to settle back down to its earlier trend rate just as Paul said there. Eventually, that`s going to lead to slower job growth and higher unemployment. For now, just to be clear, the economy and the job market in particular is still in a solid place.

But, you know, the stock market is forward looking, and it is recording the fact that Trump`s tariffs are definitely hurting sales of some of our key companies. Apple was off 10% its stock price today. That`s a remarkable drop. And it`s not every day that we can point to a reason why the stock market contracted as much as it did, over 600 points on the Dow.

This is clearly a function of the tariffs. And you explained - you did a great public service there. You explained it perfectly. Those tariffs are paid by American companies. They either take it in their profit margins or they pass it along to consumers in higher prices.

O`DONNELL: And tariffs do inhibit imports from those countries, which means, Ron Klain, when countries retaliate as China has done to, in say, the soybean market, it means that American soybean farmers cannot, in effect, sell soybeans in China because that government is in control of those purchases, and simply says, we won`t buy any. We just won`t buy any of your soybeans. We`ll go to another supplier.

RON KLAIN, SENATE JUDICIARY COMMITTEE FORMER CHIEF COUNSEL: Yes, Lawrence, I mean, you`re looking ahead to 2019 tonight. But with 2018 over, we can now look at what is the stupidest thing Donald Trump said in 2018. It`s a long list. But one candid as March 2, 2018 where Trump said, "Trade wars are good and easy to win," okay. And so, you know, that statement is now - we`re living with that right now.

In November of 2018, zero American soybeans were sold in China, none. We`ll see the final total for December, it might also be none. And for American farmers in the heartland and key parts of this country, they spent years building up the soybean markets, but right now, my home state of Indiana, the price for soybeans is lower than the cost of farmers planting them.

So they`re losing money on every soybean they planted. And that is going to really hurt. It`s pinching farmers out there. It`s pinching farmers in the heartland and the consequence of the trade war Donald Trump started, and he promised it would be easy to win.

O`DONNELL: Jared Bernstein, I think it may be - you might have the same experience I do, which is that I`ve never seen a Federal elected official at any level come into office with an understanding, a full and working understanding of international trade when I was working in the Senate Finance Committee with jurisdiction over international trade, I watched that learning curve in a lot of senators. You watch it in new presidents because new presidents, frequently the one I working with, governor of Arkansas had no experience in this.

And for most people, it`s actually a pretty quick learning curve because people like you sit them down and take them through it.

We have not seen Donald Trump learn anything about this subject in two years of the presidency.

BERNSTEIN: Donald Trump is not going to learn anything about anything from anyone. I think that`s pretty much baked in the cake. And unfortunately, he has some advisors who don`t understand this either.

And I think the Apple case is really interesting in this regard, Lawrence. The problem is that globalization - and what I would have tried to explain to someone in that position is that globalization at this point is an omelet that can`t be unscrambled when it comes to these trade flows.

That doesn`t mean that it`s all good. It has downsides and we have to do a lot to help the workers who have been hurt by it. Trump doesn`t do that. What you can`t do is punish the trade flows themselves, because at the end of the day, you`re going to end up hurting American companies, American stock markets, investors, and workers themselves.

O`DONNELL: And you end up trying to pick winners and losers within your own economy, which is something that all Republicans have always believed government is really terrible at and government has proven it`s terrible at.

We`ve got to end it there. Jared Bernstein, Ron Klain, thank you both for joining us tonight. Really appreciate it.

Tonight`s "Last Word" is next.


O`DONNELL: Their people have been here for thousands and thousands of years, thousands of years before the European settlers arrived in what is now called America. But it took 230 years of this government, for the House of Representatives, to have its first women members who are Native American.

The C-SPAN cameras today captured New Mexico Congresswoman Deb Haaland of the Laguna Pueblo, and Kansas Congresswoman Sharice Davids of the Ho-Chunk Nation sharing an emotional moment after being sworn in.

Congresswoman Haaland took her oath in traditional dress and was joined at the Capitol by her family. That is tonight`s "Last Word." The "The 11th Hour with Brian Williams" starts now.