Transcripts For MSNBCW NOW With Alex Wagner 20141009

There will have to be some patience here and this will be a long struggle. We will degrade and destroy them. We better do it. Good day. Im ari in for alex wagner. An incursion that may demonstrate the limits of the u. S. Airstrikes against the terror group, after weeks of warnings the isis victory could result in death for thousands of kurds. U. S. Military forces have launched 23 air strikes in and around the syrian town of kobani. It it has not stopped isis yet. There are estimates that isis militants control about a third of the city and u. S. Officials openly acknowledge that air strikes will not be enough to save it. Today, secretary of state john kerry saying that setbacks in kobani do not define the strategy to destroy isis. Let me make very, very clear, kobani is a tragedy as it represents the evil of isis, but it is not the definition either of the strategy or of the full measure of what is happening with respect to isil. It is one town and there will be others where there will be conflicts with isil over the course of these next months. As smoke from the fighting drifted over the border literally into turkey there, the government is not proactively intervening. Turkish officials do not want to empower kurdish separatists in syria. They said it was not realistic for the west to launch a ground war against isis on its own. It is continuing a fullcourt president , general john allen is in turkey today holding highlevel meetings on all of this and syria is not the only place where isis may be building influ fluence. According to intelligence officials who spoke with nbc news today, canadian detectives have clues against potential targets in canada. These are clues of potential plans, to be clear, not current operations. Officials say any plots that they have been looking at are at the aspirational stage. Even if actual isis operations are a long ways from the u. S. , the threat and the idea of isis continues to surface on the campaign trail here heading into the midterms including republican candidates invoking the group to present a supposed contrast with democrats. Evil forces around the world want to harm americans every day. Their entry into our country through arizonas backyard, yet Ann Kirkpatrick consistently votes against her party to protect arizona. How dangerous is rick nolan . America under threat, and with Americas National security threatened warnings of islamic extremists and isil plotting imminent attacks and what does mark udall say . I said last week that isil does not present an imminent threat to the nation and it doesnt. Really . Can we take that chance . Joining me now is Washington Post columnist and seniorseniorw at the brook igs institution and the author of the new middle east, fawaz. Lets start with kobani before we get to the political attack ads. What is, in your view, the significance here as the town continues to falter . You know, ari, i understand what john kerry said that kobani is not very va teeningic to the americanled strategy. Yet, as you just said the the United States has carried more than 20 air strikes in the last few days to rescue kobani. Obviously, its a very significant place. What does the capture of kobani do . It basically would represent a major propaganda boost for the socalled Islamic State. This would go against the americanled strategy. What does the capture of kobani does . It gives the socalled Islamic State basically a control of a long strip of territories on the syrianturkish borders. This alsos any against the americanled strategy. Not only do you not want the socalled Islamic State to make dwantes. You want to roll it back and what does the capture of kobani does . It basically represents a major defeat for the courageous, selfdefense Kurdish Forces who have been fighting tooth and nail to defend their city despite great odds with weapons and hardly anyone has come to the rescue except the american air strike. So all in all, the capture of kobani which represents a major defeat, a major defeat for the americanled strategy that has made it very clear that the key goal is to stop the advances, the surge of the Islamic State in particular in iraq and syria. Right. Upon wh when you take that point, e. J. , that is part of the problem for the u. S. Here and that will not be super strategic and we are bombing and we have set off a policy of degrading isis and setting isis back. Isis is not being set back on this instance and theyre not on their heels and taking more land as they go and speak to the reticence of other states in the region. Turkey is there on the border and israel is very close and israel is a country that does not want to engage in a ground war. Neither do we, so can we blame them . Part of the problem is u. S. Air power can do can a lot, but it cant win on the ground and the kurds both in iraq and here as mr. Gerges suggested have been very courageous fighters, but they do not seem to have the capacity on the ground that they would need to pully push the Islamic State back and so that is leading to these calls saying, well, if the turks dont do it and the turks dont want to do it because they dont want to strengthen the kurds. Theyve had conflict in their own country with the kurds. The government in turkey now has the modus operandi there and they dont want to exacerbate that situation. And so the pressure will be from some on say well, if ywe want t push them back we want to put american roops in, but america doesnt want to put those troops in. It strikes me you show the ads. The ads are trying to be about alleged democratic weakness and in a lot of cases theyre just trying to smuggle the immigration issue in behind the Islamic State, fears of penetration, but americans dont want troops there either. So right. Theyll have to take some time before theres real success. Theyre shoehorning that and theyre speaking to a midterm electorate and a Republican Base that has gotten excited about isis. We looked at these numbers from gallup. When you look at the top five issues part republicans, its the economy, to wifollowed by i followed by good jobs. Good jobs, equal pay and the equal, and its just pumping up their base to feel that this is another area where the president doesnt have a clear policy. I think its definitely a base strategy because republicans havent had a lot of clear issues. Obamacare isnt working for them the way they had hoped or theyve gotten everything theyll get out of that now, but i think their hope is that however many voters there are in the middle are feeling just a little bit more uneasy today with both the rise of the Islamic State and now ebola. The republicans did a very good job of using fear and unease in the 2002 elections after the attacks on 9 11, and i think what youre seeing out wethere w is to attempt to create some of the feeling that helped them in that election. So, yeah, it will help with the base, and ive been last week in New Hampshire and in North Carolina and in those senate races, you can see republicans trying to use this issue both to heighten the the immigration issue. The fears at the border, but also to sort of convey toughness and its worth mentioning those two states have women, democraticincumbent senators. How do you think the allies and the coalition in the region, look at this because we are headed into our own election here and then the period where the president may have more problems with congress as we try to figure out what is the longterm strategy. You know, i want you to know there is a great deal of skepticism about the americanled strategy even a part of the coalition. Everywhere i go in every Arab Television station, and everyone i talk to say are the americans serious about basically defeating the socalled Islamic State . People are not convinced that american strategy is com p comprehensive and longterm and decisive, but let me come back to the central question of the strategy. The reason why kobani would most likely fall, not because basically cob an e the defenders do not have the capacity and the means, ari. This had is a besieged town. A city you have a few thousand defenders. The fact that its besieged, the fact is that turkey and neighboring countries are not providing the am fig, tmission e help. No one is asking turkey to intervene militarily. No one is asking the americans to send basically ground troops. Were talking about providing the defenders, the citizens who are defending their city with the means to defend themselves and here is another piece of the american strategy. Americanled strategy is based on the idea you need local forces. What better local force you have here . The kurdish citizens defending their areas against this particular organization. This is the problem. The problem is the coalition itself and the nature of the coalition and the lack of really basically a one particular strategic vision. Visavis, the socalled Islamic State. Half in and half out. Thank you both very much. I want to tell our viewers here. After the break, well look at those new protests in st. Louis happening today after an offduty cop fatally shot an offduty teenager last night. Its two months after the killing of Michael Brown and some important issues still to be resolved and we also have new details about the texas man hospitalized yesterday for possible signs of ebola. Well have an update on that and later, something im pretty excited about. Do you remember when the government stepped in to save aig from bankruptcy with your money during the financial crisis . They spent billions to keep them a float. If you havent heard about it, that same company is suing the government saying they deserve even more money, 40 billion more. Ill speak with former congressman coauthor of the financial reform bill and thats all ahead on now, as well. I have the worst cold with this runny nose. I better take something. Dayquill cold and flu doesnt treat your runny nose. Seriously . Alkaseltzer plus cold and cough fights your worst cold symptoms plus your runny nose. Oh, what a relief it is. Having a perfectly nice day, when out of nowhere a pickup truck slams into your brand new car. One second it wasnt there and the next second. Boom youve had your first accident. Now you have to make your first claim. So you talk to your Insurance Company and. Boom youre blindsided for a second time. They wont give you enough money to replace your brand new car. Dont those people know youre already shaken up . Liberty mutuals new car replacement will pay for the entire value of your car plus depreciation. Call and for drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. Switch to Liberty Mutual insurance and you could save up to 423 dollars. Call Liberty Mutual for a free quote today at see Car Insurance in a whole new light. Liberty mutual insurance. Football fans like meat clearly, i am a football fan. Up your game with the new ultimate meats pizza. A large for 12 dollars. 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The dallas hospital said the patient originally presented at the hospital after 10 00 p. M. On thursday, september 25th at that time the patient presented with lowgrade fever and his condition did not warrant admission. Texas officials also clarified that duncan did not receive the same serum or drug rans fusion of ashoka mukpo because his blood wasnt compatible and nor did he receive zmapp. We have to prepare for the long haul here. Weve had one case, and i think there may be other cases and i think we have to recognize that as a nation. I dont think were making a claim that anything is 100 secure, but whats most important is we know, we know how to contain and that is detect, contact tracing, isolation and treatment. And while travel hubs across the u. S. Are working on that detection and preparing to screen passengers for ebola, fears continue to rise overseas. Today Spanish Health authorities the condition of the nurse infected with ebola is deteriorating spain is now monitoring other people to see if they develop symptoms of the virus. After a british man who passed through the uk died from macedonia from what could also be an ebola case. The Ebola Outbreak remains in africa for the most part and more u. S. Troops at texas fort hood are preparing to go to liberia. The three countries hit hardest by ebola have been making desperate pleas for help on the global conference on the outbreak back in washington. At that meeting, Thomas Frieden warned of the dire global cost of inaction. I will say that in the 30 years ive been working in public health, the only thing like this has been aids, and we have to work now so that this is not the worlds next aids. Strong words there as the World Bank Estimates that the largest toll on this, the largest Ebola Outbreak in history could now reach close to 33 billion and not to mention, of course, the human cost of the virus which has already taken 4,000 lives around the world. The actual figures when totaled up are likely to be much higher. Coming up, we will go live to missouri which is preparing for days of demonstrations to mark the twomonth anniversary of Michael Browns killing. That is next. [ starter ] ready [ starting gun goes off ] [ male announcer ] its less of a race. Yeah [ male announcer ] and more of a journey. Keep going strong. And as you look for a Medicare Supplement insurance plan. Expect the same kind of commitment you demand of yourself. Aarp Medicare Supplement insurance plans insured by unitedhealthcare Insurance Company. Go long. I wish. Please, please, please, please, please. [ male announcer ] the wish we wish above all. Is health. So we quit selling cigarettes in our cvs pharmacies. Expanded minuteclinic, for walkin medical care. And created programs that encourage people to take their medications regularly. Introducing cvs health. A new purpose. A new promise. To help all those wishes come true. Cvs health. Because health is everything. Cvs health. receptionist Gunderman Group is growing. Getting in a groove. Growth is gratifying. Goal is to grow. Gotta get greater growth. I just talked to ups. They got expert advise, special discounts, new technologies. Like smart pick ups. Theyll only show up when you print a label and its automatic. We save time and money. Time . Money . Time and money. Awesome. Awesome awesome awesome awesome all awesome i love logistics. Crowds continue to gather in st. Louis today after an offduty white Police Officer shot and killed a black teenager in the seacitys shaw district. We do not have all of the details of the incident, the officer was working a secondary shift for a private Security Company when he witnessed three black males acting suspiciously and eventually one pulled out a weapon. The suspect pointed the gun at the officer and fired at least three rounds at the Police Officer. At that point the officer returned fire. As the officer moved toward the suspect the suspect continued on pull the trigger on his gun. That suspect, a teenager in the altercation is now dead. Authorities have not released any names yet. There was an Immediate Reaction in the community, just 11 miles south of ferguson where an unarmed black man was shot two months ago now. About 300 people came to the scene of the shooting and this is last night and that gathering turned violent when about a dozen people punched and kicked two police cars and this was while officers were inside them and kicked in one cars back window smashing it. In the ferguson case, of course, a grand jury is expected to decide whether to press charges against the officer who killed Michael Brown and the Justice Department is continuing a separate investigation both into the guys and the Police Departments conduct there. To that end, attorney general eric holder opened a forum on Race Relations and Community Policing just yesterday. A gathering where ferguson loomed large. When i traveled to ferguson in the days after that incident my pledge to the people of that community was that our Nations Department of justice would remain focused on the challenges that they faced and the deep seeded issues and the issues the shooting brought to the surface long after the National Headlines had faded. Were taking robust and sweeping action to make good on the pledge that i made. And there was another speaker at that gathering who brought up the tension in ferguson. A former president who was tough on crime and committed to advancing Race Relations in america. The thing that struck me reading all of these heartbreaking stories day after day after day about ferguson, right down to the day that a lot of the white residences of the city were interviewed and saying they were just stunned by all of this. They had no idea there was this much hate. You know, we cannot afford not to know our neighbors. Joining me now is a criminal defense attorney and former prosecutor sema ire and from st. Louis, criminal defense attorney and columnist for the st. Louis american, liz brown. Good day to both of you. I had. Hello. Liz, lets start with this new incident that people are responding to. Obviously, there is tension and there is understandable concern given the history and yet this particular incident looks rather different from the facts we have as compared to Michael Browns the shooting. Well, i dont know that it looks different to one particular side of the issue. What we have here is an issue of trust with the police. If there was trust with the police and if the police had built a relationship with the community there wouldnt be the question, the intense questioning or believeability to what the police are articulating as what happened in this particular case. So it may factually differ a little bit from the Michael Brown piece, but the the underlying issue is the issue of trust and the issue of trust is the same in Michael Brown as it is in this case. Sema, what is your view of that and the trust being important if the claims are that this person was armed and the fact all question is whats our source for that . People dont even believe the the initial Police Reports when they are coming out. If you and i are talking about cases and were talking about different sets of facts, but what liz is saying in being in that community, this underlying theme of Race Relations controlling the whole dialogue that the police and the community, they do not trust each other. Right now the community is concerned there will not be an indictment for Darren Wilson and therefore looking ahead, how are they going to handle it. There is no vehicle for justice in that town. You mention that, lets discuss that because that has not been resolved. This grand jury is hearing its evidence. They have heard from mr. Wilson, the officer here in that shooting which is unusual. Why is that . Usually, and i would like to hear lizs perspective. As a criminal defense attorney you do not want your client to testify in the grand jury because that statement could later be used against them in another proceeding, right . But in this case, because the officer, hes a Police Officer. He is authorized in appropriate situations to use deadly force, probably has never been arrested before and he is almost one of them, one of the prosecutor, an extension of them so you have this underlying vouching for the Police Officer. So he is that ideal 1 , i would let testify. Liz, what do you think of that and the decision to have him testify . I think that its an extraordinary decision and we also should understand that this came at the invitation of the prosecutor. Its not only that its a friendly environment, its possible that this is an environment where he has been that he has been in before with this exact same grand jury. We dont know that. It is possible that he could have testified in front of them, therefore they could have seen the credibility of him. So its a wonderful environment. Its a friendly environment and its an environment that doesnt hurt the client at all and in particular all of the evidence and all of the stories about what happened in had this particular case have all been told except for his. So he can conform his story to all of the evidence thats already been put out in the court of Public Opinion which is remarkable and its what the defense attorney would dream of. Sema, speak to that because there are two sides to that. The type of scrutiny that has occurred here has had measurable results. You have a federal investigation which creates some pressure. You have at the policy level the city of ferguson changing how it responds to some of these lowlevel infractions and the fines that theyre issuing and there have been some small steps here. Upon on the flip side to lizs point, this creates a potentially richer environment to this case if hes a defendant to fix the pafacts of whats be out there. Of course. Now theres scrutiny. Theyre looking at this case to find out what happened which is why the prosecutor is presenting all of the evidence which had is not always done. I have often presented witnesses to a prosecutor and the Prosecutor Says no, im not putting them through to the grand jury. Exactly. In this case theyre presenting everyone, and i think what liz speaks to which is why it is so important to have someone who is in ferguson to say, this officer he may have testified in the grand jury on another case. They know him. Let me play president clinton speaking about having reform and president ial campaigns in the same conference we had earlier. Take a listen. Okay. We basically took a shotgun to a problem that needed a. 22. A very significant percentage of the serious crimes in this country are committed by a very small percentage of people we refer to as criminals because they violated the criminal law. And you have people like rand paul and paul ryan even saying we need to look at rehab over punishment. Jim webb who has talked about, led on this issue in the senate. Could we be approaching a moment where we have a National Debate on this . Well, i think thats why attorney general holder talked about the report that was done by president johnson over 50 years ago, and it took two years to complete that and when you look at some of the findings in that report, the remarkable thing is they were asking for the things that people are asking for right now. The report concluded that we need more officers of color. We need more community engagement. We need those types of things. Thats what that report said over 50 years ago. So its not new. Its not hard. The information is there. The question is whether there is the will and the stomach to do what needs to be done. The political will and the willingness to Work Together on something this important. Liz brown and sema ire, thank you both for joining me. Appreciate. Thank you so much. Well look at politics next looking at state republicans who are worried about losing a state in the midterms and that would be kansas and incumbent senator pat roberts faced off with independent greg orman and this was last night and i did a favor for you guys. I watched the whole thing so you dont have to well show you the best parts and what democrats think about the potential democrat who says hes against obama and harry reid runs the senate like a dictatorship. Thats next. Ah come on lets hide in the attic. No. In the basement. Why cant we just get in the running car . Are you crazy . Lets hide behind the chainsaws. Smart. Yeah. Ok. If youre in a horror movie, you make poor decisions. Its what you do. This was a good idea. Shhhh. Be quiet. Im being quiet. Youre breathing on me if you want to save fifteen percent or more on Car Insurance, you switch to geico. Its what you do. Head for the cemetery sea captain theres a narratorstorm cominhe storm narrator that whipped through the turbine which poured. Surplus energy into the plant which generously lowered its price and tipped off the house which used all that energy to stay warm through the storm. Chipmunk theres a bad storm comin narrator the internet of everything is changing how energy works. Is your Network Ready . Yourbam ean. Charmin ultra strong cleans so much better it meets even the highest standards of clean. With a soft duraclean texture, charmin ultra strong is 4 times stronger. And you can use up to 4x less. Charmin ultra strong. So ally bank really has no hidden fethats right. Accounts . Its just that im worried about you know hidden things. Ok, whys that . No hidden fees, from the bank where no branches equals great rates. Kansas republican senator pat roberts is calling in his congressional comrades. His control of the Upper Chamber may hang in the balance. Ted cruz teaming up this afternoon and launching a fourday bus tour upon. Thats a race that the got tight in a hurry. Last night they had a big debate and it was the first since this became a twoman race and it shows how kansas has suddenly become one of the keys to control the senate. I believe obama is part of the problem. I think i think any senator who stands up here and tells you hes going to repeal the Affordable Care act is ignoring the reality that president obama will simply veto the bill. And orman there also criticized the aclu last night, but he did hit from the left. I have said from the beginning that im supporter of amnesty, but it all has to be practical. We are not going to find and send home 11. 5 Million People nor would it be advisable. I thought he said hes not for amnesty and the the last debate in hutchinson kansas he said he was for amnesty. Thats not shooting straight. Thats not coming clean. Pat robertson, theyre neck and neck. Fox has roberts up by five and at the very least all that polls show is that orman is doing pretty well with a Campaign Message that wont say as he stands. As an independent hes not just duck the issue of who he would caucus with. He even said hell switch sides again after a few months if the majority is too partisan. The four or five months goes by and its clear that theyre continuing the same old partisan bickering, the same old fingerpointing and not solving our countrys problems. Then well be able to caucus with the other party. That is the strategy and if orman wins it will be had historic in one way. This is the first time kansas would have elected a nonrepublican to the senate since all of the way back to 1932. Joining me now from kansas city is gary hay for 41 action news. How are you . Im doing well. How are you some. Im doing all right. Talk to me as for roberts hes had a lot of problems with his residency and people sanymore, and the Washington Post did a whole look at this how he moved away from focusing on issues in the Agriculture Committee and even passed up the chairmanship to basically focus on intelligence, certainly an Important National ecurity issue and one tmgo because a lot. Right, but he managed to have moderate republicans in the statehouse during the last round of elections here. And mitt romney with 6 of the vote and republicans have a vote and republicans have a 300,000 vote registration and for many, its a struggle to keep your a1c down. So imagine, what if there was a new class of medicine that works differently to lower blood sugar . Imagine, loving your numbers. Introducing oncedaily invokana®. You can win on those policies unless there is an abject failure and the jury is still out on that from brownback and well find out about that in four weeks when people say this had has gone too far or not. You made a good point there and an interesting payback itemses here is the people angry at brownback may ultimately end up punishing roberts here because he seems to be more vulnerable. I appreciate your take on the ground. Derek hague, thanks so much. Absolutely. Coming up, six years ago when aig was head for bankruptcy. They got 85 billion from the government and now they want 40 billion more. This is the case of the decade and its happening right now and well tell you why. Ab p t and weve got more news for you today on the constantly evolving state of samesex marriage here in america this afternoon. West virginia dropped the opposition that makes it the latest straight to embrace equality. The South Carolina Supreme Court temporarily blocking the issues for licenses in gay couples. For those keeping score, as of right now pete william, samesex marriage is legal in 26 states and the district of columbia. Supreme court will let us know if thats going to expand further. Coming up, you cant make this up. A failing Financial Company rescued by taxpayer dollars, our money during the financial crisis. Now they want 40 billion more in basic bailout money. Former congressman barney frank will join us to break it all down, but first we also have breaking news back on regular old wall street. Hampton pearson has the cnbc market wrap. Ari, yeah. We had the markets really getting hammered today. The biggest oneday drop in the dow this year. More concerns about the economic slowdown in europe with help expected by the European Central bank. The dow mruplunging. 3535 poi 335 points and the the nasdaq closing down 90 points. Thats the latest from cnbc. Than im equipped for, because im raising two girls on my own. Ill worry about the economy more than a few times before theyre grown. But its for them, so ive found a way. Who matters most to you says the most about you. At massmutual were owned by our policyowners, and they matter most to us. Ready to plan for your future . Well help you get there. Sweet charmin softness. Take a closer look at charmin ultra soft and youll love what you see. Not only can you use less, but you can actually see the softness in our comfort cushions. We all go. Why not enjoy the go with charmin ultra soft . Athats enough plastic bottles boto stretch aroundery year. The earth 230 times. Each brita filter can replace 300 of those. Clean. Clear. Brita water. Nothing is better. Today, former Federal Reserve chief ben bernanke became the latest government figure hauled into court to defend the bushcombrera will bailout from the 2008 financial crisis. Its all part of what could be the biggest bailout case of the decade. An expensive clash between unrepentant wall street titans who want more bailout money and top treasury officials from the president obama administration, people like geithner and paulson. In other words, from taxpayers like you. They argue that the Bush Administration and the new york fed illegally strong armed aig, the Insurance Company that backed bad bets in the housing bubble into taking a bailout during the financial crisis on unfair terms. They complain they only got 85 billion bailout with extortion rate rules for their loan guarantees. That is the argument of the companys shareholders led by the former ceo, 89yearold hank greenberg. The government has essentially rebutted these charges as ridiculous sour grapes from wealthy ingrates who would be far worse off without their precious will bailout. It it does take incredible chutzpah for bailout beneficiaries to say they didnt get enough free money, but this weeks trial is also offering, i think, something of an inadvertent Public Service here. Its compelling former bush and obama officials to testify under oath about those big, rushed bailouts and its shining the light on some of the topics between wall street and washington that could be useful and so far, a lot of those top government witnesses are emphasizing they had every right to attach any strings they wanted to aigs handout. Quote, it was important that terms be harsh, paulson told on the court, for example. When companies fail, shareholders bear the losses, its just the way our system is supposed to work. Tim geithner stressed he had every right to use Emergency Powers because a full collapse would be an unprecedented emergency and the consequences of aigs failure was so great and i was confident we had met that test. Aig is trying to prove the the opposite that the government exceeded its power and forced them into a loan that was even worse than their other options like declaring bankruptcy. As their suit argues, quote, faced with the feds nonnegotiable demand, aig had no choice, but to accept the governments loan on the governments terms. Joining me now is the chairman of the House Financial Services committee and coauthor, of course, of the financial reform law following the crisis, former massachusetts congressman, barney frank. Hi. How are you some. Good. You have aig saying they were extorted. Thats news to a lot of taxpayers who say if anyone was extorted during those emergency deals it was all of the tax dollars, all of the people who paid them. Well, first, lets be fair to the people now running aig, but aig, the company itself is not suing. Mr. Greenberg is a disgruntled and hed been kicked out. So thats the first thing. Second, one small correction. They didnt get an 85 billion bailout. They got a 170 billion bailout. Its true, they came to the fed and asked for 85 billion on. A week later they said that wasnt enough. They needed more. This company, lets understand at the outset. They were so irresponsible. Not only did they incur enormous debt that they couldnt repay, basically they promised to insure other peoples Mortgage Securities for those Mortgage Securities turned out to be Housing Loans and couldnt pay off, aig had promised they would make it it good. Not only did they not have the money to make it good, these great financial wizard his no idea how much they owed. Thats the first point. Secondly, i was not we didnt vote on this. This was a unilateral decision by the Federal Reserve, though i will say this, one of the things from the standpoint whether this was so unfair to them, our view at the time in the congress, certainly on the democratic side, was that they had been treated too generously and the power that the Federal Reserve used to advance the money to pay off the debts and who was keeping them in business as a company, theyre still at aig. We took that power away from the Federal Reserve and under todays law, if a Company Comparable to aig got itself in that trouble, yes, we would pay off the debts to prevent there from being a total collapse, but the company would go out of business and secondly, by the way, the money that was paid would be recovered from other financial companies. Here is the last point, this notion that they were forced to do it is simply nonsense. Nothing in the world could have stopped them from declaring bankruptcy. They had every legal right to do that. That would have meant the end of the company. I want to the funny part we want to zero in on here. Let me read from the aig shareholder suit here thats being litigated this week. They said the fed and the government took a number of actions and made a number of statements that disadvantaged aig compared to other Financial Institutions and contributed to aig having no choice other than taking the loan that argues for the reasons you state, congressman. We could go down this road again. Let me finish the question. Theyre saying here in court that they didnt have that other option because the way it was structured and that they had to pay a loan at 14 while people like citigroup got it at 3 . Two things. First of all, we wont go down that road again. I guarantee you, the specific section of the law, section 133 of the Federal Reserve act which allowed the Federal Reserve to advance in that money and allowed them to stay in business has been repealed or substantially amended so it cant be used for that purpose, and this is the deal when they say they had no choice they leave out one sentence, they had no choice if they were to remain a company. Nothing in the world constitutionally, they had every right to declare bankruptcy if they wanted to declare bankruptcy, but that would have meant the end of the company. So what they are implicitly saying the only way we had to have someone else step in and pay the debt that we couldnt pay ourselves and still be a company and continue existence is we went along with the fed. Secondly, we have now changed that law so that in the future if if a company like aig has to have its debts paid because it cant pay it themselves we will do that, but they will be they will be abolished. What you have here, and again, lets be clear, it was the absolute irresponsibility of aig that caused this. They knot himselves so heavily indebted they couldnt pay. While i have you, congressman, they took this money and it was mad because it went to other big wall street players. Does this weeks trial and getting these guys under oath from different areas, does it at all help explain once and for all why so many wall street players got paid back 100 cents on the dollar and other people took losses . No. There was never any question about that and heres why, under the law at the time and weve changed things with the financial reform law. In the future, if a big company heres why they knot paid off. They got paid off because Lehman Brothers was allowed to go bankrupt and no one would step in to save them. That had a very negative effect on the economy. People stopped lending each other money and the economy was grinding to a halt. Under the existing law there were two possibilities and either aig went bankrupt or the fed had to step in and pay those debts and under existing laws, the companies at aig had a legal right if they didnt ago bankrupt, thats something we changed. In the future if you deal with one of those big companies, the federal government if it has to step in will give you some repayment, but not all. They did not have that option. So they required that everyone would be paid in full. That was the result of the legal structure at the time which has now been amended. Its a detail at times and as for the law youre referencing, paul drugman did a victory lap saying it went a long way. I can make one other point . In ten seconds, go ahead. Aig in 2009 had paid bonuses to the very people who had caused the crisis. One of the worst outrages weve seen and this was why they were so unfairly treated. Congressman, barney frank, thank you for your time today. Stay with us. We have more now after this. 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A santa monica hub for startups and entrepreneurs. Right now there are more millennials than baby boomers in this country. More 22yearolds than any other age group. In other words, if you want to get serious about the future, you have to take millennials seriously and thats what the white house is aiming to do with that tour there. The president will also hold a town hall where he hopes to highlight policies on Student Loans and health care that have helped the socalled millennial generation. Well keep you posted on all of it. That is it for now today and well see you tomorrow at 4 00 p. M. Eastern. The ed show starts now. Good evening, americans. Welcome to the ed show live from minnesota. Lets get to work who would have thought south dakota the land of great faces and great places. One of the places to gain control of the u. S. Senate. A complicated race in south dakota. For control of the u. S. Senate. Thats been the the theme of your campaign. Taking it back from big money, special interests. If we dont win south dakota we wont win back. Good to have you