Fox News celebrates its 25 years of spreading division and anger in America. President Joe Biden has declined a request by his predecessor Donald Trump to prevent White House records of the deadly January 6 insurrection at the United States Capitol from being turned over to congressional investigators. Former President Donald Trump is instructing four top former aides to defy subpoenas to turn over records and testify to a select congressional committee investigating the Jan. 6 insurrection at the U.S. Capitol.
JOY REID, MSNBC HOST: Black conservatives who have to becloud themselves for a seat at the Jim Crow table are tonight`s absolute worst. That`s tonight`s "REIDOUT." ALL IN WITH CHRIS HAYES starts now.
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CHRIS HAYES, MSNBC HOST (voice-over): Tonight on ALL IN. 25 years of division and anger.
DONALD TRUMP, FORMER PRESIDENT OF THE UNITED STATES: Why can`t he produce a birth certificate?
UNIDENTIFIED MALE: Deep-seated hatred for white people or the white culture.
TUCKER CARLSON, HOST, FOX NEWS CHANNEL: The strategy is to change the demographics of the country.
UNIDENTIFIED MALE: I`m more worried about it than you are.
HAYES: Tonight, the undeniable evidence that Fox News is the real source of America`s rising rage.
SEAN HANNITY, HOST, FOX NEWS CHANNEL: Do you think we`re bad for America? Do you think I`m bad for America?
TED KOPPEL, BRITISH-AMERICAN BROADCASTER: Yes.
HAYES: Then, what we know about what`s being turned over as the White House denies Donald Trump`s request to keep his record secret, and the January 6 committee promises action to compel people to talk.
Plus, as one Senator worries about the silence of the chickens.
SEN. TED CRUZ (R-TX): One or the other was going to turn or you were going to have a lot of dead chickens.
What to make of today`s rough job numbers with Jared Bernstein? And why on earth is the rental market getting out of control? When ALL IN starts right now.
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HAYES (on camera): Good evening from New York. I`m Chris Hayes. You`ve probably seen these viral videos have been going around, maybe not. But there`s been a lot of them of people losing their minds at school board meetings. You might have seen this particularly egregious video. It`s of a woman braiding a mother because the mom`s kid was wearing a mask.
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UNIDENTIFIED FEMALE: He`s going to be traumatized because you put that mask on him and you don`t let him breathe.
UNIDENTIFIED FEMALE: That`s my choice. That`s my choice. You better respect my choice.
UNIDENTIFIED FEMALE: No, no. You`re (INAUDIBLE)
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HAYES: Now, this is to put it mildly, incredibly anti-social behavior, just wildly outside the parameters of everything anything you would want or expect in civil society. You think to yourself, well, where would someone even get the idea to do something like that? Well, we have an answer.
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CARLSON: As we`re forcing children to wear masks outside, that should be illegal. Your response when you see children wearing masks as they play should be no different from your response to seeing someone beat a kid at a Walmart. Call the police immediately. Contact Child Protective Services. Keep calling until someone arrives. What you`re looking at is abuse. It`s child abuse. And you are morally obligated to attempt to prevent it.
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HAYES: There is a direct pipeline from what appears on Fox News to the absolute worst manifestations, worst behavior, worst elements of our politics and society, input to output, clear and strong connection. Just take a step back and survey the wreckage of the current moment, this unprecedented era in American politics. The first president in the country`s history without any meaningful political or military experience, the first president impeached twice, the first deadly insurrection which tried to interrupt the peaceful transfer of power and overthrew the duly elected government since basically, the cannons firing in Fort Sumter during the Civil War.
We have experienced all of that, these genuinely novel, unprecedented destructive events in just a few years. How did we get here? The answer is in large part Fox News. And so, it is fitting that on the network`s 25th anniversary, they`re patting themselves on the back amid all the pomp and circumstance, Donald Trump, the monster they created both an avid Fox News viewer and the network`s quintessential talking head, the real-life case study of what happens when you try to govern the country based on the network`s cynical and demagogic misinformation, that he was who they chose to have on to complete the circle, the logical conclusion of Fox`s quarter century-long project to rebuild the United States in its image.
It was exactly the kind of sycophantic propaganda you would expect from Fox, not even a pretense of asking Trump a tough question about say, a new report that implicated him in an attempted coup. Instead, we got the same disgusting vile racist attacks on immigrants that have become Fox News`s brand over the past few decades. And it was almost fitting because Donald Trump, the politician, and his racism, and nativism, authoritarian aspirations, almost entirely a creation of Fox News.
And the political project that its founding CEO Roger Ailes first set out to make half a century ago when he pitched then-President Richard Nixon on a news network that would beam pro-Republican coverage directly into Americans homes every night. Trump`s presidency was the apotheosis of Ailes vision for the country, the country we now have, which is being torn to shreds in the midst of a Democratic crisis and a deadly once in a century pandemic, which is so much deadlier than needs to be in large part because of what Fox is putting out every night.
There`s a body count there. Fox`s corrosion of over discourse maybe reaching a crescendo now but there`s a great piece in Mother Jones that makes a compelling case the network`s debut 25 years ago in 1996 was the point that started to push this country on its current trajectory of heightened polarization and distrust of major institutions.
From the insane spectacle the Clinton impeachment in the late 1990s, the 2000 presidential election between George W. Bush and Al Gore which Gore won the popular vote of, its chaotic aftermath to the racist destructive culture war madness of the post 911 era and the lead up to the Iraq war. When the country band then known as the Dixie Chicks were essentially removed from polite society for daring to criticize then-President George W. Bush and the House of Representatives cafeterias started serving "freedom fries" to protest France`s opposition to the Iraq war, and of course, the word self, which was touted as a huge success on the network, while its critics who were of course ultimately vindicated by history, were lambasted for their lack of patriotism. To the racialized backlash to Barack Obama`s presidency, including birtherism, the racist conspiracy theory that says Obama was not born in this country, which was Donald Trump`s first major foray into the political discourse. And that`s the groundwork for the entire MAGA movement.
All this was fueled by Fox News in the perpetual conservative outrage machine. And it`s not just speculation, there`s been studies done of this. There`s studies that have determined that Fox News is real motivating factor in American politics. One study found that Fox`s impact increased Republicans vote share and presidential elections by three to four points. In a country as polarized as ours, that is enough to be massively consequential.
I mean, for reference, Republicans have won the popular vote exactly once since the 1980s. In 2004, George W. Bush did win an outright majority of voters. But according to this study, if it was not for the boost from Fox News, that outcome would have been reversed. And it`s not just voters, Republican politicians basically live in fear of Fox, the backlash it could inspire.
In his memoir, former Republican Speaker of the House John Boehner, writes about that destructive influence that it had on his party. He recounts going to confront then-chairman of the network, Roger Ailes about Fox News coverage. "I once met him in New York during the Obama years to plead with him to put a leash on some of the crazies he was putting on the air. It was making my job trying to accomplish anything conservative that much harder.
Boehner goes on to say that Ailes was not receptive to his request. Ailes was a true believer through and through. He was not just cynically manipulating right-wing outrage or conspiracy theories about Obama and the Clintons. Roger Ailes believed it all too, or at least he did by that point. And he weaponized an entire conservative media empire to broadcast that pathological paranoia at least until he was forced out of the network he built when more than 20 women including high-profile Fox anchors accused him of sexual harassment. He died shortly thereafter.
And so, it is true that to a certain extent, Fox operates as state-run TV for elected Republicans. Just listen to former Trump press secretary Stephanie Grisham describe the relationship.
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UNIDENTIFIED FEMALE: What was the role of fox news in the White House?
STEPHANIE GRISHAM, FORMER WHITE HOUSE PRESS SECRETARY: That`s just where we went to get what we wanted out. They, you know, by and large, didn`t get tough with us. They just took what we were saying and disseminated it.
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HAYES: Elected Republicans obviously use Fox to disseminate pro-party propaganda. But we also cannot ignore the reverse wag the dog reality where increasingly Republican politicians are themselves having Fox viewers. That`s where they get their information. They follow the network`s leave. Kevin Drum highlights one example of Fox leaving the party in that great Mother Jones piece "Starting in March, Fox mentioned critical race theory 1300 times in the space of just three months. By the end of June, 26 states that introduced legislation that restricted or banned teaching CRT and related topics."
All this, of course, brings us back to our present moment where every day, as we continue to chronicle on this show, Fox News is pushing out a constant stream of public health misinformation that is getting people sick, getting them into the hospital, getting them killed and prolonging this pandemic.
It`s unconscionably dark. It`s the darkest, most extreme logical conclusion you can imagine for where this entire enterprise would end up. Where you`ve got these phenomenally rich cosseted elite Fox hosts sitting in their little studios on the lights with hair and makeup and expensive clothes, working for a company that mandates either vaccines or daily testing regime, precisely the policy they`re railing against. But they won`t say that they won`t say anything about their bosses because they`re too cowardly.
Instead, what they`re doing is pushing poison into people`s brains that gets them sick. This is where both the modern enterprise of Fox News and the conservative movement more broadly have ended up, the most acute threat to American democracy we have seen in 150 years. So happy 25th anniversary, guys. You did it.
I want to bring in two people have been studying the detrimental effect of Fox News for years. Joan Walsh, national affairs correspondent for The Nation, where she`s written about the damaging impact Fox has on our nation`s health. And Eric Boehlert, a former senior fellow at Media Matters and founder and editor of PressRun.media where he monitors right-wing propaganda in the post-Trump world.
Eric, let me start with you. And there`s an important point here about the landscape of American politics, which is people that are watching this show right now most likely consume a lot of different media from a lot of different places. They maybe listen to NPR, they read a bunch of newspapers, and we`ve got Pew data to back this up, right?
So, if you`re talking about Democrats, like here are things that are used by at least 1/3 of Democrats, ABC News, CBS News, CNN, MSNBC, NBC News. Republicans is just Fox. Like, basically 40 percent of the country, there is a monopoly of information on those folks.
ERIC BOEHLERT, FOUNDER AND EDITOR, PRESSRUN.MEDIA: Yes, I mean, they`re -- it`s one-stop shopping. Yes, there`s OAN, yes there`s Newsmax, yes, they`ve splintered off even farther, farther right. But when you talk about propaganda, it`s so much more effective if there`s only one place to go, and Fox News has created that.
Look, the history you gave was dead on. You hit all the key points, the recount, the 911, the war in Iraq. And when Stephanie Grisham talks about, well, we go on -- we go on Fox News, and they don`t ask us tough questions, they`re the propaganda for the GOP. To me, that`s kind of Fox News circa 2014.
What you describe what this country is now facing with the pandemic, which has revealed and both broken these people is beyond description. Fox News has killed -- we`ll never know how many people Fox News killed. Off the top of my head, 100,000 I think is a reasonable estimate.
And we -- you know, we`ve all talked about it being a cult, it being brainwashing, and people used to shake their heads, oh, you can`t talk about the media when you talk about brainwashing. It`s just a conservative outlet. It`s brainwashing and it`s a cult because lives are now at stake.
This is not about immigration. It`s not about tax reform. It`s not about Obama is a socialist. These are about their viewers literally taking their own lives at the behest of vaccinated hosts. And everyone in Fox News is not giving a damn. And cheering the 25th anniversary, there was a -- there was an interview with the CEO this week. She says she sleeps great at night. She doesn`t have a concern in the world.
She`s spending those Murdoch paychecks and everyone is overseeing a death cult berating. It`s mind-boggling. But that is where this brainwashing movement has ended real quick when you add a GOP party embracing authoritarianism, Fox News brainwashing, and a QAnon cult. That is a formula for a crumbling democracy, which we are seeing right now.
HAYES: You know, the cynicism is key here that Eric mentions, Joan. And this is something I`ve been really struck by. I mean, but the combination of the cynicism and cowardice, right? So, all of these hosts, Laura Ingraham, and Tucker Carlson, and Sean Hannity, they go on and they peddle this vaccine misinformation and they rail against vaccine mandates. Their own company has one. They won`t say a word. None of them would say a word.
JOAN WALSH, NATIONAL AFFAIRS CORRESPONDENT, THE NATION: We know that they are -- we know that they are vaccinated.
WALSH: We know that they are vaccinated.
HAYES: And very -- almost certainly vaccined. But that cynicism is carrying on Roger Ailes` tradition. I want to read this quote because it jives is something you said you wrote about your one meeting with him. So, this is him from his memo to Nixon saying people are lazy. With television, you just sit, watch, listen. The thinking is done for you.
He had tremendous contempt for his audience, he kept it his whole life in the same way Donald Trump does, and he evinced it in the one meeting that you ever had with him.
WALSH: He did. You know, he was like, our viewers don`t even want to know somebody like you exists. But he took a meeting with me and my, you know, my bosses at Salon, because he was kind of curious. I mean, I think he wanted to know that we existed and who we were. But it was just so amazingly cynical.
And it was shocking how, how just on top of the world he was and just convinced that we would never get through to his audience. And he would never put us through to his audience. And I still feel to this day. Like, I have no idea that we could have broken through, but it was just a warning. And I don`t think I took it seriously enough at the time, Chris. I really don`t. It was an -- it was achy when I think back on it, but it was really, really a warning.
HAYES: Yes, and I mean, the control here is the only other thing that I`ll say here is that they`re also -- they live in fear of losing their audience that`s the other thing. Like there`s control and there`s monopoly. But because they don`t have real competition the way that everyone else in the other areas of media does, Eric, we saw a little bit with OAN and Newsmax and all these sort of election trutherism where they started to get beat a little bit and they will never let that happen.
It doesn`t matter how vile, how horrible, how wrong or flatly factually wrong it is. They will chase whatever it is that keeps them in possession of that audience.
BOEHLERT: Yes. Hannity`s ratings right after the election were a disaster. Hannity`s ratings December and January, that audience was depressed pre insurrection. And it looked like he was -- you know, they were going to lose a big chunk of their audience. And as you said, I knew, I knew there was going to be a disaster. 2021 was going to be a disaster for Fox in terms of the vile programming because it`s exactly what you said.
They had never really had anyone kind of snipping at the heels. And there is no way they were ever going to be outflanked on the far-right in a meaningful way by anybody. You go back and you look at the Fox coverage five, 10 days after Trump loss. There was kind of this hey, let`s move on, hey, what`s going on by late December, January, all in stolen election, what is going on? Democrats are stealing. They will never be outflanked and they don`t care what it takes.
And Tucker Carlson is proving that he doesn`t care how many of his viewers die as he pumps out, you know, anti-vaccine anti-science during a public health crisis. This public health crisis should have ended in July. I mean, thousands, thousands of Republicans have just killed themselves since the vaccine to own the libs as they call it at Fox News. I mean, it`s just astonishing.
HAYES: Joan, the other -- the other aspect of this, and this has been a through line is they delight in punching down. They will pick some random freshmen at some college who did something like burned a flag or they`ll -- or Bill O`Reilly will bully the son of someone who lost their life in 911, or you know, Tucker Carlson will pick out some reporter, one of my colleagues, for instance.
And the audience, when they put something on their sites, like it is -- it creates a security problem for that person. It`s a -- it is a cascade of abuse that sort of unlike anything else in media.
WALSH: It absolutely is. And, you know, I mean, I went through it when Bill O`Reilly took off after me. And I think it was, oh my god, it`s like 10, 11 years ago, but it was terrifying. And their people are just really sad people who just want to go after the people that they think are doing them wrong.
And I don`t know that that`s still happening, but I assume it is. And I do know that Tucker Carlson is sending his flying monkeys after a lot of people, whether it`s you know about the great replacement theory or it`s about not getting your vaccine, which he got, we all know he got it. But it is -- it is still scary. I would just -- I would like them to kind of shut it down.
HAYES: That`s -- I think it would be really wonderful for the country and the world if that happened though I doubt it will. John Walsh and Eric Boehlert, thank you.
WALSH: I`m a dreamer. I`m a dreamer.
HAYES: The deadline for the January 6 subpoenas has passed and Steve Bannon is trying to dodge the committee by hiding behind Trump`s executive privilege claim, a claim that was roundly and officially rejected by the White House today. So what happens now? What are the consequences for defying congressional subpoena? Congressman Joe Neguse joins me on that next.
HAYES: Donald Trump has been trying to use executive privilege to withhold documents from the January 6 Select Committee. Well, today the Biden administration formally rejected that appeal sending a letter to the National Archives saying, "The Constitutional protections of executive privilege should not be used to shield from Congress to the public information that reflects a clear and apparent effort to subvert the Constitution itself.
This comes after Trump encouraged four of his top aides to ignore the subpoenas recently issued by the committee. Now, according to the committee, two of those aides, former chief of staff Mark Meadows and former Pentagon aide Kash Patel are "engaging with the Select Committee. Politico reports that his -- that Deputy Chief of Staff for Communications Dan Scavino was served with his subpoena today. We told you that they hadn`t gotten to do that yet, while Trump`s former chief strategist Steve Bannon has "indicated he will try to hide behind vague references to privileges of the former president according to the committee.
Today, the committee made clear there will be consequences for ignoring subpoenas. They write "We will not allow any witness to defy a lawful subpoena or attempt to run off the clock, and we will swiftly consider advancing a criminal contempt of Congress referral. Meanwhile, other Democratic members of Congress are proposing legislation to find witnesses up to $100,000 for defying congressional subpoenas.
One of the members sponsoring this legislation is Congressman Joe Neguse, a Democrat from Colorado. He served as an impeachment matter in the second impeachment trial of Donald Trump and he joins me now.
There`s a lot to digest here because there`s a bunch of moving pieces. So, let`s start first with the White House`s stepping in to say to the National Archives there`s nothing here, go ahead. What does that mean? What`s the legal impact and significance of that?
REP. JOE NEGUSE (D-CO): Well, good evening, Chris. It`s good to be with you. It`s a big development. I think the White House made the right call and a prudent step forward to ultimately direct the National Archives to disregard any spurious claim of intellect -- excuse me, of executive privilege, which you know, I think would have been intellectually dishonest under these circumstances given as the White House said, what these documents purportedly may very well show which is the subversion of the peaceful transfer of power, and ultimately conduct that is clearly relevant to the events of January 6.
So, I think it`s an import And step forward and obviously a sea change from, you know, the spurious claims of executive privilege that we were so become so accustomed to under the Trump administration from the White House.
HAYES: Does this mean -- this may be an operational question that you don`t have the answer to, but I`ll ask it anyway. It`s like -- it seems to me like they should just furnish it. And if they want to litigate post facto, fine, but there should be no delay here. I certainly agree with you. With respect to the documents, I don`t think that there`s any question that that would be the logical step forward, and I suspect that the select committees imploring the National Archives to do precisely that. We`ll of course see whether or not litigation gets in the way.
HAYES: OK, that brings us now to these four people who are -- who are defying the subpoenas as of now, two of them engaged with the select committee, two of them Bannon and Scavino, basically just thumbing their nose at it. Bannon, I think, wrote a letter -- you know, Bannon is a particularly ridiculous case. He`s not part of the executive. He was an unpaid advisor. He had received a pardon for a very serious charge of fraud that he was facing by the President.
And the President is no longer the president, the guy that he was advising. There`s like zero good faith executive privilege claim here. And the question, I guess, is, do you let him try to run out the clock in court?
NEGUSE: The answer is no. I mean, look, I agree with you, Chris. Obviously, it`s absurd and ridiculous the letter that the Mr. Bannon`s lawyer, submitted to the Select Committee. It is consistent with the wholesale obstruction that we experienced and witnessed firsthand during the Trump administration, as you`ll remember, and I was a member and still am a member of the House Judiciary Committee, and we saw the Trump administration play this exact same playbook time and time again as they stonewalled congressional investigations.
But what has changed, of course, and what is different now is that the Department of Justice is, you know, obviously, you have an attorney general at the Head of Department of Justice who I think cares a great deal about co equal branches of government and separation of powers and ensuring the constitutional prerogatives of the Congress are respected.
I mean, at the end of the day, if witnesses can defy subpoenas without consequence, then congressional oversight really no longer exists. And it`s hard to make the case that Congress is a co-equal branch of government under -- in that circumstance. So, you know, I take very seriously the Select Committee`s language that was in the press release today with respect to potentially pursuing criminal contempt of Congress, a referral to the Department of Justice, which, you know, we`ll have to -- time will tell as to whether or not the Department of Justice under Attorney General Garland will ultimately implement that referral and pursue it.
But my -- many of my colleagues also believe that we shouldn`t wait for the Department of Justice and that we should pursue the inherent contempt powers of the Congress in the interim, which is something that the Congress can and should do.
HAYES What does that look like?
NEGUSE: So, inherent contempt powers of the Congress, Chris, have always existed under our Constitution. The powers have been largely dormant for the better part of the last 90 years. And myself, Ted Lieu, Val Demings, a group of us on the House Judiciary Committee, who again experienced the stonewalling of the Trump administration firsthand, a year and a half ago proposed changing our rules to essentially codify and authorize the use of inherent contempt.
And inherent contempt would function very similar to the way in which criminal contempt of Congress functions if that referral is implemented. So, a long-winded way of saying that essentially, it would include fines, monetary penalties, and I should mention that in the past, inherent contempt has been used by the Congress in both the Senate and the House with penalties of imprisonment as well. The last time was during the Teapot Dome scandal of the 1930s.
So, Congress is not powerless. It would not require the passage of the resolution in the Senate, and it would only require a majority vote in the House of Representatives. So, we think our resolution is a prudent step forward. And we`ll certainly be encouraging our colleagues to take it up.
HAYES: Wait, that`s key. You don`t -- you wouldn`t need the Senate? Because when I saw this earlier today, I thought like, obviously, there`s not going to be 10 Republican votes for this in the Senate. Your theory of the case here is that this would be a simple majority vote of a resolution adopting rules codified in the branch of the house itself which derives the power from the U.S. Constitution.
NEGUSE: That`s precisely right. The implied powers under the constitution that give the House and the Senate the ability to use its inherent contempt power to enforce duly authorized Congressional subpoena. So, really, the resolution is simply a codifying a set of procedures, right, that are required, and that ultimately would survive Constitutional scrutiny as the Supreme Court has, you know, opined on this in the past.
Look, the evisceration of Congressional oversight really is nearing crisis levels. And it has for quite some time. And so, you know, implementing this resolution would put Congress back on the path I think of repairing the damage that has been done over the last several years under the Trump administration. I think it`s a prudent step forward. And I`m hopeful that my colleagues will agree.
HAYES: Well, if it comes to that, and you have to send the Capitol Police out to find Steve Bannon, I would recommend you first search the nearest Chinese billionaires yacht you can get your hands on. Congressman Joe Neguse, thank you very much.
NEGUSE: Good to see you, Chris.
HAYES: Up next, another edition of the worst drama on Capitol Hill in which the junior senator from Texas once again doesn`t even know what he`s even talking about.
SEN. TED CRUZ (R-TX): In the game of chicken Chuck Schumer won this game of chicken as two trucks drove towards each other on a country road one or the other was going to turn.
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CRUZ: I believe the end result of this game of chicken was clear. I believe Democratic Leader Schumer was on the verge of surrendering. And then, unfortunately, yesterday, Republicans blinked. I think that was a mistake. I think that was the wrong decision. In the game of chicken, Chuck Schumer won this game of chicken.
CRUZ: As two trucks drove towards each other on a country road one or the other was going to turn or you`re going to have a lot of dead chickens. I wish Republicans hadn`t blinked. We shouldn`t have done that.
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HAYES: Wait a second. Wait a second. First of all, how many metaphors are mixing in there? But second of all, more importantly, does Ted Cruz think the game of chicken is two trucks full of actual chickens driving towards each other? What movies has he`d been watching? Now he does happen to be right about one thing. Minority Leader Mitch McConnell absolutely blinked, swerved, got out of the way, flinched in negotiations about whether or not to raise the debt ceiling and enabled the U.S. to pay for things it had already purchased.
Last night, 11 Republican senators, including McConnell join with Democrats to enable the passage of a bill to temporarily prevent the U.S. from defaulting on its payments at least until December. Speaking today, President Joe Biden pointed to that agreement is a sign that things are getting done.
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JOE BIDEN, PRESIDENT OF THE UNITED STATES: Turn on the news and every conversation is a confrontation. Every disagreement is a crisis. But when you take a step back and look at what`s happening, we`re actually making real progress. And thanks to bipartisan agreements, we`re making progress on funding the government and raising the debt limit. So people continue to get their social security checks, the military continues to get paid and so much more.
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HAYES: But also spoke with Mitch McConnell. Today, of course, shortly after that. McConnell released a letter to Biden saying Republicans would not support raising the debt limit when it comes up again in December. He`s going to plow that truck full of chickens into the other chicken truck. And we`ll see if Ted Cruz learns how a game of chicken works by then. But here`s the thing, the Biden agenda is a lot more than just keeping the government open and funded.
Of course, there`s a long way to go. They`re getting his signature bills passed from one of the status of president`s Build Back Better bill and the rest of the Biden agenda. I`m joined by Jared Bernstein, a member of Biden`s White House Council of Economic Advisers. It`s good to have you on, Jared. Let`s start with today`s jobs numbers which came in far below what I think consensus estimates were.
Unemployment sub-five percent which is encouraging but 200,000 jobs. There`s -- I think there`s -- there was this idea that people need to get vaccinated and everything`s going to come roaring back and it looked like that for a bit, and then we got Delta. Now where are we in the recovery`s trajectory?
JARED BERNSTEIN, MEMBER, PRESIDENT BIDEN`S WHITE HOUSE COUNCIL OF ECONOMIC ADVISERS: Yes. That`s a great question. We are making progress. We`re making solid progress. You started out with the unemployment rate, oh, came down from 5.2 to 4.8 percent. That`s a big drop in one month. And that`s the lowest it`s been first time below five percent since the pandemic hit.
You know, a couple of years ago, the Congressional Budget Office looked at the pandemic-induced recession, and thought that we wouldn`t get to unemployment this low until 2023. That was before this president passed the American Rescue Plan. And this links right up to your question, Chris, because what did the rescue plan do? It got shots in arms also checks in pockets. And that meant people could go back to work, they could reengage with commerce.
And that`s why we`ve seen not only that drop in the unemployment rate, but 4.8 million jobs and historical record since this president took office. So solid progress in the labor market, it`s going to come in bits and bobs and ups and downs a month, a month, and you`re right, Delta is still upon the land. But that`s why the vaccination agenda is so important.
HAYES: One to 10, 10 being very concerned, one being not concerned at all. How concerned are you about inflation?
BERNSTEIN: Well, I`m always concerned about anything that`s above average, when it`s -- when we`re talking about inflation. And so, before the pandemic kicked in, we started having some of these supply chain transitory disruptions inflation was running at around two percent. And of course, it`s been well north of that. The main thing -- the way I think about this in terms of concern, though, is what do we expect to happen once these supply constraints, once these bottlenecks unwind?
And we begin to see a smoother flow of goods, of chips, of the kinds of goods that are flowing through our ports but have seen again, bottleneck conditions. We haven`t forgotten how to make cars, we haven`t forgotten how to produce and to import chips. In fact, one of the investments that so important to the Biden administration is building a domestic capacity to beat some of these supply problems.
That`s going to take a while, but that`s a longer-term solution. And the consensus among economists is in fact that these disruptions are transitory. So every forecast is for inflation to start coming down in coming quarters. And that`s the way I think about that scenario at this point.
HAYES: There is a big announcement today that piqued my curiosity. The OECD has been working on essentially a global minimum corporate tax. So the idea is there`s a race to the bottom, there are all kinds of countries that have essentially kind of used very, very low tax rates to attract not just business, but a lot of very shady, shady money hiding and monitoring frankly. There`s a -- there`s a deal now struck of the 15 percent global minimum. Is this a -- is this real? Is my question like, is any -- this is going to be enforced, is this a real thing we`re looking at?
BERNSTEIN: Yes, great question. It is real, it is a big deal. One reason I think you can attest to its reality is 136 countries just joined hands, representing 90 percent of global GDP to take the global minimum tax from zero to 15 percent. Now, why would all those different countries, some of which, by the way, have been pretty low tax havens themselves? Why would they join hands and do this precisely for the reason you gave?
They`re tired. They`re middle class, just like our middle class. They`re leaders, just like Joe Biden are tired of seeing countries book their profits in low tax havens, book their deductible expenses and higher tax countries and come away with a level of profitability that rubs their treasuries just like ours of a 150 billion per year in revenue. So very real, very important. A big deal. You know, this is what Joe Biden calls foreign policy for the middle class because it dampens the incentive to offshore jobs in production and it brings revenue that should be back in America back to our coffers.
HAYES: All right. Jared Bernstein, come by anytime for updates. It`s good to -- good to talk to you.
BERNSTEIN: Thank you, Chris.
HAYES: All right. Still ahead. From Seattle to Scottsdale, from Boston of Boise, rent is going through the roof. Why prices are skyrocketing in American cities coming up.
HAYES: If you ever seen the musical Hamilton or listen the soundtrack, you know one of the people you cannot help but completely fall for is the Marquis de Lafayette. He raps at an insanely fast pace with a French accent. In fact, he holds the record for fastest Broadway rap which I guess makes sense. Clocked at 6.3 words per second at some points.
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UNIDENTIFIED MALE: Everybody give it up for America`s partying fighting Frenchman.
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HAYES: The Marquis de Lafayette was originally played by the wildly talented Daveed Diggs. I`m sure it`s his image that pops into the heads of a lot of people right now if they hear the name Lafayette. But the real Marquis de Lafayette was a towering figure in both American history and French history. As is represented by the fact there`s almost certainly something named after him where you live.
There are dozens of American cities and towns named after Lafayette. Countless parks and streets and plazas. Back the park just across the street from the White House is Lafayette Park named after him. If you want to understand why that is the case, you can listen to this week`s Why Is This Happening podcast interview with historian Mike Duncan. Mike has a great new book out about the Marquis de Lafayette called Hero of Two Worlds.
And Duncan is also the host of one of my favorite podcasts in the world, The Revolutions podcast. So, it`s really, really a pleasure to talk to him about learning history, discussing history, and America`s favorite fighting Frenchman. Check it out on this week`s episode with pod wherever you get your podcasts.
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HAYES: Over the last year and a half throughout the pandemic, it`s been hard to get a lot of things. Remember back at the beginning of the pandemic, it was things like hand sanitizer, masks, toilet paper. Remember the images, rows and rows of empty store shelves? Well, every online retailer was sold out too. And then earlier this year the big problem was computer chips. In fact, Jared Bernstein just referenced that.
And that shortage slowed production to new cars, causing prices of used cars to skyrocket. Now the shortage everyone is talking about is in housing. This one has been a long time coming. According to the National Association of Realtors, of course not exactly disinterested party but still, the U.S. has under built its housing needs by at least 5.5 million units over the past 20 years. Meaning we are 5.5 million houses short right now.
This chart tracks the number of new homes being built since the year 2000. And you see that sharp downturn bottoming out after the previous housing bubble in 2008. And the slow increase in the year since but never making it back up to where it was before. So we`ve been left with a big housing supply problem. And now in cities big and small around the country, the housing market has gone completely and utterly bonkers.
In New York City, the return of many people to cities since the pandemic has sent rate -- rents into the stratosphere up by about 70 percent compared to a couple months ago. According to real estate broker. That is leading to some really, really nutty situations like a line of 80 people to view a nearly $3,000 a month two-bedroom unit in Chelsea.
In the suburbs of San Francisco, up to 80 percent of homes are selling above lift -- list price, often after while bidding wars like a recent sale that received 21 offers. In Boise, Idaho area home prices are up nearly 40 percent leaving out people like John Evans, who was born and raised there but can now afford the larger home his growing family is looking for. "I`m not in a position to make an all cash no contingency offer nor am I willing to go $100,000 over asking, which is what we`re up against."
Newbies are literally throwing money at everything leaving guys like me in the dust. Diana Olick is CNBC`s Real Estate Correspondent. She has been covering this insane housing market and she joins me now. It`s great to have you, Diana. Let`s -- they`re sort of I think some slightly different dynamics happening in the for sale and rental market. And I want to focus first on the rental market. What is going on broad -- broadly in the rental market in the United States, in cities, particularly right now?
DIANA OLICK, CNBC REAL ESTATE CORRESPONDENT: Well, thanks for having me from one. But what`s going on is something we`ve never seen in the rental market before and that`s bidding wars. That`s usually relegated to the home buying market but you`re actually hearing from rental agents that you`re seeing lines of people out the door that they`re coming in, offering over asking price of rent which is -- this is not normal.
And we`re also seeing people coming in saying, well, I`ve got better credit scores or I cannot or you more up front plus a little bonus or something else.
OLICK: All things that we all used to see in the buying market we`re now seeing in the rental market because rents are soaring for apartments way up. And in fact, we actually saw the largest occupancy 250,000 people more getting apartments just from July to September. That is the largest single quarter of occupancy and apartments since the early 1990s. So that gives you an idea of just how crazy it is for rents.
HAYES: Well, I can`t even mention that about over asking thing because I have not heard hearing this from people. And my first thought was like is that a thing that happens? Did I -- did I not know that this was a thing that happens? Like -- and if people are asking, you know, giving over asking and a house, which is an investment, you can say, well, I think the value will ultimately exceed that even though it`s over asking, I`ll make it back.
But in rent, it`s just like -- that`s just more money for the landlord, like that and this seems to be happening in a lot of places.
OLICK: Yes. I mean, it`s really as you say, when you -- when you rent, you`re throwing the money out. You`re getting what you`re getting, and you get nothing back. But what we`re really seeing is in the single family rental market, when you go to rent an apartment and it`s listed in a major building by a company, that`s going to be the rent that the rent is, You can`t really offer over asking for that.
Single Family rentals though are huge right now, because people want to live in the suburbs, they want the school districts, they want to get out of the cities during COVID. And single family rentals are just booming. And those are owned by single landlords. Some of them are large companies but most of them are either mom and pop or small investors and they`re going to take whatever you`re offering.
HAYES: Right. So -- OK. So, here`s what I don`t quite get. So there is a structural problem here, which is that particularly in large and growing metro areas, there has been an under-supply of housing, there`s particularly in cities, I know, you know, affordable rental units, particularly. But generally supply has not expanded as much as it should. And that pushes up prices. That`s a structural issue.
But what has happened in the past few months to make this happen now because it seems so acute, so specific and so sharp?
OLICK: Well, it`s not really the past few months. We`ve been under building as you showed in your chart for many years. And that was because after the great housing crash and subprime mortgage crisis, when the builders just got slammed, they pulled back. They didn`t want to build anything over them what they thought they could sell. And they`ve been slowly, very slowly climbing back.
You ask the question, well, if there`s so much demand and builders are getting so much demand, why aren`t they just building as many houses as they possibly can? Go back to supply chain issues. Labor issues, land issues, material costs, they cannot cancel. That is they cannot build the types of houses that are in demand. That is that entry level, lower price, first-time homebuyer house, they can`t afford to build that, they`re not going to profit off of it.
They can only build the step-up level house or the luxury house. There`s not quite as much demand for that. But even when they want to build that, there`s -- coming up against so many issues for land labor materials and those higher costs that they`re actually -- believe it or not, I mean, they are pulling back on selling which sounds crazy in a market where you have so much demand.
They are pulling back on how much they will sell right now because they are afraid they just can`t deliver it.
HAYES: Right. So then, you`ve got the -- right. So, you`ve got the actual supply chain issues that are affecting all different parts of the economy or applying that, you know, pertain to the new -- the new housing market too. But it also seems like -- I guess I wonder how much -- I guess there`s not much slack in these rental markets anyway, when they`re normally operating. And so, fairly small changes around the margins.
I mean, that was the thing we saw the toilet paper, right? It was like -- it didn`t take a ton of change in consumer behavior at the margin to create like fairly catastrophic consequences. And I imagine it`s something similar with how the rental market usually functions and usually clears and what the normal band of essentially vacancy there is.
OLICK: Well, you have to remember A, in a house, it`s not as easy as a roll of toilet paper, right? But when you`re talking about apartments also remember we`ve had a -- an eviction more than moratorium going on for over a year now. That meant that people who could not pay the rent could not be evicted. It also meant that people for other reasons who couldn`t pay the rent, maybe it wasn`t COVID could not be evicted.
You have this regular cycle of apartments of people moving out cycling through and they just weren`t moving at all. Maybe it was the rent, maybe it was because they had nowhere else to go. Also they couldn`t move up to buy a house because housing got so expensive. They were just staying put. So that normal cycle that you`re talking about and people coming in and people going out is just not happening the way it would in a regular year.
HAYES: Yes, yes. So you`ve got the normal back view as sort of a backlog. I mean, I`ll personally editorialize and say I`m glad people weren`t evicted during a pandemic but you`ve got this backlog that that ends up, you know, creating this the situation now. It`s going be really interesting to see where this goes next. Diana Olick who has been covering this. Thank you so much.
OLICK: Thank you.
HAYES: That is all in for this week. "THE RACHEL MADDOW SHOW" starts right now. Good evening, Rachel.