Full Episode: Pressure on Shinseki, Cyber Spying Tensions, Primary Review

May. 23, 2014 AT 5:46 p.m. EDT

Chinese Army officialsover cyber spying, analysis Tuesday’s primary elections and President Lyndon Johnson's call to make America a 'Great Society' fifty years later. Joining Gwen: Jeff Zeleny, ABC News; Pete Williams, NBC News; Susan Davis, USA Today; Karen Tumulty, Washington Post.

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Notice: Transcripts are machine and human generated and lightly edited for accuracy. They may contain errors.

GWEN IFILL: The escalating scandal at the VA, tackling Chinese cyberhacking, Tuesday’s winners and losers, and the Great Society 50 years later – tonight on “Washington Week.”

PRESIDENT BARACK OBAMA: (From clip.) If these allegations prove to be true, it is dishonorable, it is disgraceful, and I will not tolerate it, period.

MS. IFILL: New allegations of cooked books, long wait times and widespread mismanagement at the Department of Veterans Affairs angers lawmakers on both sides of the aisle.

REPRESENTATIVE MIKE POMPEO (R-KS): (From clip.) What is taking place in Americans’ – America’s Veterans Administration may be the most egregious case of friendly fire in the history of the United States of America.

REPRESENTATIVE DAVID SCOTT (D-GA): (From clip.) There was no urgency. Mr. President, we need urgency. We need you to roll up our sleeves and get into those hospitals.

MS. IFILL: Let the investigations begins.

At the Justice Department, indictments aimed at getting the Chinese government to stop hacking American companies.

ATTORNEY GENERAL ERIC HOLDER: (From clip.) These criminal charges represent a groundbreaking step forward in addressing that threat.

MS. IFILL: But what effect will they have?

Election day victory strengthened Republican prospects for the fall and clarified their strategies.

SENATOR MITCH MCCONNELL (R-KY): (From clip.) Kentuckians are not going to be deceived. Alison Lundergan Grimes is Barack Obama’s candidate.

MS. IFILL: And half a century after Lyndon Johnson engineering a sweeping expansion of government –

PRESIDENT LYNDON BAINES JOHNSON: (From clip.) For in your time, we have the opportunity to move not only toward the rich society and the powerful society, but upward to the Great Society.

MS. IFILL: How does it resonate today?

Covering the week, Jeff Zeleny of ABC News, Pete Williams of NBC News, Susan Davis of USA Today, and Karen Tumulty of The Washington Post.

ANNOUNCER: Award-winning reporting and analysis, covering history as it happens, from our nation’s capital, this is “Washington Week with Gwen Ifill.” One again, live from Washington, moderator Gwen Ifill.

MS. IFILL: Good evening. It’s a perfect storm: allegations of government malfeasance, cover-up, the possibility of lives lost, and betrayal of our nation’s heroes – all culminating in multiple demands that heads roll. The growing scandal engulfing the Department of Veterans Affairs’ health programs is now the subject of several investigations.

PRESIDENT OBAMA: (From clip.) Veterans deserve to know the facts. Their families deserve to know the facts. Once we know the facts, I assure you, if there is misconduct, it will be punished.

MS. IFILL: At the center of it all, mild-mannered VA secretary Eric Shinseki, who for now at least still has his job, but demands for accountability are coming from both sides of the aisle.

SPEAKER JOHN BOEHNER (R-OH): (From clip.) This is awful stuff, and somebody ought to be held accountable for it.

I’ve not called for General Shinseki to resign, although I have to admit I’m getting a little closer.

MS. IFILL: These allegations are not new, so why is all of this exploding now, Jeff?

JEFF ZELENY: Well, Gwen, one of the reasons it’s exploding now, there are so many examples. It’s not an isolated incident at the Phoenix VA. Investigations are underway across the country in at least 26 of these centers. And that means, you know, that about half the Senate is involved because if they’re in 26 locations, everyone is now suddenly investigating this. But the reality is anyone who’s gone to a congressional town meeting or listened to or talked to someone who opens the mail in a congressional office, they hear VA complaints all the time for years.

So one question is, why is this just coming to a head right now? It’s because it’s an election year, for one. You know, there’s a lot of political outrage. But there is real outrage here. But we are just ending 12 years of war, more than 12 years of war, all these new people coming into the system. You know, several older veterans are still in the system. So all this coming together, as you said, a perfect storm.

MS. IFILL: And a lot of people who are actually surviving who would have died with previous kinds of medical care.

MR. ZELENY: No question.

MS. IFILL: But I’m also really curious about what the White House thinks it can do. They – he sent a deputy chief of staff this week to meet, I guess, with the people in Phoenix. And so does the White House feel like it has to do something just to do something?

MR. ZELENY: I think the White House is obviously taking this very seriously. He sent Rob Nabors, who’s a top adviser, deputy chief of staff, but not a household name, certainly. I asked Senator John McCain, obviously a veteran, of what he thought about that. And he said, who? I mean, he did not think that Rob Nabors was a credible person to send, someone who had experience in veterans’ issues.

So there is no question the White House is engaged and involved in this, but I think they’re – it’s so – it’s worth asking why did it take the president so long to speak about this. He finally did this week at the podium.

One thing is, I mean, there aren’t any easy answers to this. And he is famous for not rushing to fire people. And I think that’s the case here. So the head of the VA, a decorated veteran himself, Eric Shinseki, is, you know, certainly under siege here, but probably not entirely his fault, but now it’s his to clean up.

PETE WILLIAMS: So what’s the endgame on this scandal? Is it just to find out who was cooking the books in terms of how fast they process? Or could it lead to some fundamental changes in the VA?

MR. ZELENY: Well, I think that’s a fundamental question. I mean, it depends if the same problems were happening in all of these 26 locations. If this was a systemic thing to actually, you know, change these wait times and other things, that’s a real problem. But I think there has to lead to some type of a – of a solution here. But what that is, I don’t think we know yet.

KAREN TUMULTY: But have you –

MS. IFILL: Oh, sorry –

MS. TUMULTY: Well, the controversies, though, that have hit this administration – Benghazi, the IRS – have generally sort of just stirred up the partisans. Is this one likely to resonate differently with Democrats and with swing voters?

MR. ZELENY: I think it is, no question. We’re already seeing that. I mean, veterans are from both parties. They’re Republicans. They’re Democrats. The outrage is coming from both sides – not exactly equally; you see some people who are running for office who are saying that the secretary should be fired, some people who are in office saying (he shouldn’t ?) be fired. But the reality is I think that this is a scandal that people can understand. This isn’t sort of some partisan witch hunt. This – these are actual victims, people who have died with real voices and families. So I think this is absolutely a real scandal.

SUSAN DAVIS: You mentioned that it was an election year. Who is calling for Shinseki to go? And at what point do you think the president is going to have to make a call over stay or go?

MR. ZELENY: You know, it’s a small number of people. So far, we heard Speaker Boehner early saying he’s not yet. Leader McConnell in the Senate, both Republicans, he is not either. But not surprisingly, perhaps, Mitch McConnell’s Democratic opponent, Alison Lundergan Grimes in Kentucky, she issued a statement calling for the firing of General Shinseki, so perhaps that’s one way for her to distance herself from the president. But right now it’s pretty mixed. A couple Democrats, a few more Republicans.

But look, we have not seen this administration, this president fire people, shove people out the door. That wouldn’t solve anything. Someone else would have to be confirmed here. So I think he stays for as long as the president wants him to.

MS. IFILL: It also seems that General Shinseki and Barack Obama are alike in that their temperament is so mild. And so when General Shinseki last week said, I’m really mad as hell, it didn’t really –

MR. ZELENY: They both came from Hawaii, someone told me. And that is exactly why, you know, just a mild-mannered sort of – you know, I think there is anger there, no question about it, but it is that kind of gentle manner that both of them have in common.

MS. IFILL: Well, we’re going to see whether politics overtakes the facts, and we’ll see what happens after that.

MS. IFILL: OK. It seems straightforward enough. If Chinese hackers are infiltrating your computer systems, why not do everything you can to stop them? But what if they accuse you of doing the same thing? And what if the accused hackers are not private-sector tech geeks but agents of the Chinese government? For the U.S. Justice Department, that spells indictment. But to what end, Pete?

MR. WILLIAMS: Well, the – in the past, the government says, any time they confront the Chinese and say, you know, you’re spying on American companies, they say, where is the proof. So the Justice Department this week said, OK, here is the proof, in public, the first time the U.S. has ever charged officials of a foreign nation with using cybertools to hack onto American companies.

And think how extraordinary this is. You showed those pictures at the beginning, actual wanted posters of individuals in China that the U.S. says, this guy did that, this guy did this to –

MS. IFILL: In military uniforms.

MR. WILLIAMS: Yes, to raid American companies, to go into some of the biggest names – U.S. Steel, Alcoa, Westinghouse – all part of a military intelligence unit.

And the charges say they went after executives of these companies, sent them emails that when opened up basically gave them complete access to the computers, and they could steal these trade secrets. In the case of Westinghouse, for example, the government says they got data equal to 700,000 emails.

And the charges were possible because of the evolution in the ability of the U.S. to investigate these hack attacks. What I’m told by one official is that it got so good at one point that the investigators could sit at their cubicles here in the U.S. and watch the individual hackers actually entering keystrokes on their computers in China, and that’s why the indictment is so specific with, you know, dates and graphs and circles and arrows and times and dates on when people did specific things to these companies.

MS. IFILL: Well, what does Justice Department say about whether we do the same sort of thing?

MR. WILLIAMS: Well, the U.S. says there’s a big difference. Of course, the United States spies on foreign governments – we all do that, they say. And of course, it spies on things like trade missions. But what the United States says that it doesn’t do is, say, for example, on behalf of Boeing, spy on the French aerospace company Airbus in order to steal trade secrets to help Boeing. We don’t take orders from companies.

Now, of course, in China, there is a difference because these are state-owned companies. The Chinese say it’s no different, we’re just spying on each other. The United States says it’s a big difference.

MS. TUMULTY: So what are the chances that this ever actually ends up in court?

MR. WILLIAMS: Somewhere around zero, I would say – (laughter) –


MR. WILLIAMS: – that any of these five Chinese military people will be standing in a courtroom in western Pennsylvania, which is where the charges were filed because U.S. Steel is there, so many of these companies are there.

But the government says, look, we have tried making nice. We have tried doing this diplomatically, quietly – you know, the little demarche letters back and forth. And so this is an effort every time that they get nowhere with that, they try to raise the temperature. And this is a way to say to the Chinese, we’re watching very closely, and we’re going to keep doing this.

MR. ZELENY: And what’s the reaction? What was the reaction in China by the Chinese officials?

MR. WILLIAMS: Two things. First of all, utter denial in the strongest possible words, calling the charges completely false, asking the U.S. to withdraw them, saying they’re completely fabricated, outlandish. And then more directly, the Chinese have withdrawn their participation in a upcoming summit in July on cybersecurity. So it’s probably a temporary setback there, although the people who do these things say they expect the Chinese will come back and talk about it some more.

MS. DAVIS: What about the companies you mentioned? How have they responded to this, particularly, as you said, they have so many business interests in China?

MR. WILLIAMS: Yeah. And of course, many of these companies were attacked by the Chinese at the time they were doing deals with the Chinese to do business in China. Westinghouse, for example, was building nuclear power plants in China, and the Chinese are getting the plants for the plants.

So on the one hand, the companies realize that they want to continue doing business with the Chinese. They don’t want to offend them. Secondly, I think some of the companies in general – not perhaps these, but companies in general are always a little embarrassed to have it disclosed that they were hacked into by something as simple as a phishing – you know, p h – phishing email where you send an email that looks innocuous, someone opens it, and it launches malware that basically creates a back door.

MS. IFILL: You know, I’m very curious about – I don’t know if this is – ever gets discussed, but whether on a week when there are tensions in the South China Sea, when Vladimir Putin is in Shanghai cutting a deal on gas purchases, whether there is any concern that the timing of something like this is tied to all of that, U.S.-Beijing relations.

MR. WILLIAMS: I suspect that probably wasn’t thought through in that level of detail. I know they were thinking about other cybercases that they were doing the same day. There were three big things at the Justice Department all in the same day: this day, another computer thing and then going after Credit Suisse. I think those were what they were thinking of.

MS. IFILL: Yeah. OK. Well, thanks so much, Pete.

This election is not turning out at all as Democrats were hoping. Senate Minority Leader Mitch McConnell, once thought to be the top Republican most likely to fall to tea party challenge, did not. In fact, from Kentucky to Georgia, anti-establishment Republicans have been sidelined again and again. What did Tuesday tell us about the state of the race this year, especially for the fall?

MS. DAVIS: I think Tuesday reinforced a couple lessons that we see forming in 2014. One is that incumbents are way more prepared for these threats. They’ve been warned by the campaign operations. Recent history, 2010 and 2012, put them on notice that they can’t take anything for granted. Mitch McConnell started preparing for this primary campaign two years ago. So nothing that happened on Tuesday was a surprise to him and part of the reason why he won by 25 points.

The second thing some of the tea party candidates just weren’t very good. And if you want to oust an incumbent, which is still very difficult, you really need a top-notch candidate, especially when they’re not taking things for granted. And the third most important thing for the general election is this year, unlike 2012 and 2010, Democrats really can’t count on Republicans winning their races for them by nominating candidates that are going to suffer in a general election.

MS. IFILL: Because there is no Christine O’Donnell, there is no Richard Mourdock, there is no Todd Akin. Instead, you have Matt Bevin, who was never – not only did he get beat by Mitch McConnell, but he got beat by a lot.

MS. DAVIS: By a lot. And in Georgia, there is a – there was a seven-way primary. We still have a runoff to get to in that. But the two that escaped the pack are two what you would – the most closely you’d associate with the establishment. I think the party would be happy to have either one of them. In Oregon, in a primary out there, the establishment favorite, Monica Wehby, she was endorsed by Mitt Romney, she polled over a tea party favorite. In Idaho, in Pennsylvania, House Republicans who face the only tea party challenges, they came through. So incumbents are in a good position. And particularly in the Senate, Republicans are seeing the lineups move to their favor and that the general election is proving to be very competitive.

MS. TUMULTY: Is Mitch McConnell really in trouble?

MS. DAVIS: Yes, he absolutely is. I think that, you know, he did such a masterful job getting ahead in the primary, but the data is very clear that he’s in trouble in the general. Alison Lundergan Grimes is his opponent. She – they have been neck-in-neck in almost every general election polled to date. In the most recent one that came out the Friday before the race, he was ahead.

And more importantly, Kentucky doesn’t really like Mitch McConnell. His disapproval rating in that state has been within 50 and 60 percent this entire time. So he is not only – needs to overcome a strong Democratic challenger who’s going to have significant national resources, but he’s got to get over his own unpopularity in his home state.

MR. WILLIAMS: So where does the – speaking of the Senate, how does it look for Republican control of the Senate?

MS. DAVIS: It’s a jump ball. It is entirely possible that Republicans can perform a takeover, particularly if the health care law continues to be as unpopular, if President Obama’s ratings continue to be so low, particularly in these red states where they’re defending races in Arkansas, Louisiana, North Carolina, and the fact that Republicans seem to be – they’ve wised up, they have better candidates, and it’s going to be a very expensive race because I think people, particularly the outside money we see coming in, know what’s at stake.

MR. ZELENY: So from here forward, then, what surprises do we possible have left in store? A lot of the primaries are done, but there are still a couple out there. One interesting one is Mississippi.

MS. DAVIS: Yes. Mississippi is probably the last great test of the tea party establishment test this cycle. Thad Cochran is the incumbent there. He’s being challenged by a guy named Chris McDaniel. I think that Chris McDaniel had the edge, although he seems to be faltering a little bit in the closing weeks of the race, helped in part by some activist bloggers who took some really devious steps and took some very nasty film of Cochran’s wife, who’s been disabled in a home for about 15 years. And they’re not associated with the McDaniel campaign, but there is a lot of ugly innuendo –

MS. IFILL: As far as we know.

MS. DAVIS: As far as we know, and there is no reason to believe they’re associated, but there is a lot of ugly innuendo. And I think it’s offended the sensibilities of a lot of Mississippians, and I think that plays in Thad Cochran’s favor.

MR. ZELENY: That’s in two weeks, right?

MS. DAVIS: And that’s in two weeks.

MS. IFILL: Is there bad news – I mean, let’s cycle back. We’ve talked about the bad news for Democrats, but I’m curious about whether Democrats are just sitting back here and watching this happen, or whether they, like the Republicans who sat there and said, here’s a problem, let’s see how we fix it, let’s get better candidates, let’s really take the tea party seriously this time – are Democrats figuring out how to set themselves up for the fall so they don’t get run over by the same new discipline on the part of Republicans?

MS. DAVIS: I think they do. I think part of what just hurts Democrats is the math. The field just is tilted far against their favor. There is only two races where Democrats even really have a chance to pick up, one being Kentucky and Mitch – with Mitch – or with Alison Lundergan Grimes, and in Georgia. And I think it goes to show you how –

MS. IFILL: Michelle Nunn.

MS. DAVIS: With Michelle Nunn. But I think it also shows you how vulnerable the Democrats are when their best chances are in the south, which has been traditionally not a very, you know, warm territory for them.

MS. IFILL: OK. Well, thank you very much.

Now, we’ve been marking so many anniversaries in the past year – you’ve been following them with us, from the March on Washington, the assassination of John F. Kennedy to the passage of the Civil Rights Act – that it’s tempting to lose sight of the big picture. The Great Society was the big picture.

From President Johnson’s seminal speech in May of 1964 to the signing of anti-poverty and civil rights legislation later that year to the creation of Medicare and the Voting Rights Act in the year that followed, a lot got done that changed our lives and our politics forever.

Karen Tumulty and her colleagues at The Washington Post have been focusing exclusively on that big picture this week in a series of stories on the Great Society at 50. And there has been nothing like it since, has there, Karen?

MS. TUMULTY: And I think you can argue nothing like it before. LBJ launched the Great Society with a commencement speech at the University of Michigan six months to the day after John F. Kennedy was assassinated. And what he launched I think you can argue was the single biggest experiment ever in what government is capable of doing. You (could/couldn’t ?) compare it to the New Deal, but the fact is, the breadth of what he tried to achieve was greater because it did take on civil rights and a number of areas of American life that really the New Deal didn’t touch.

And I think more importantly, the New Deal was about sort of putting out the crisis, putting out the fire of the Great Depression. What Johnson tried to do was figure out how to invest our prosperity. And twice during that speech, he sketched out what he thought America could and should look like in 50 years.

MS. IFILL: You know, one of the little detail that you – in your first story that caught my eye was just that 200 bills were passed, major bills were passed in the 89th Congress. Think about that for just a moment. What were they?

MS. TUMULTY: It was extraordinary. There was Medicare and Medicaid. There was the Voting Rights Act. There was, a lot of people forget, the enormous immigration bill that effectively – it ended what had effectively been a whites-only immigration policy that had existed in this country for 50 years. There were consumer protections. You have padded dashboards and seat belts in your car today because of the Great Society. But they were actually talking about ending poverty by 1976.

But at the same time it opened up I think just about every political debate that we have today somehow has roots in the Great Society.

MR. WILLIAMS: And why did it work so well legislatively? What was the – what – was it him? Was it the mood? Why?

MS. TUMULTY: There were a number of things that combined. Number one, he had a huge – the biggest landslide in American history in 1964 –

MS. IFILL: Nothing like landslide to get you – let you get bills get passed. (Laughter.)

MS. TUMULTY: The economy was booming. The country was still mourning this president who had awakened its idealism. And the civil rights movement had awakened its conscience. And LBJ recognized that you put all those things together with a president of unmatched legislative skills, and you have the opportunity to get a lot done very quickly. But by 1966, it had all turned.

MS. DAVIS: When we talk about – today – the contrast is so interesting to me, particularly as I cover Congress, just about the gridlock that we see. Do you think it’s possible in modern American politics to do similar grand legislative movements that – like we saw?

MS. TUMULTY: It is certainly not I think today. And again, LBJ had huge Democratic majorities. But I also thought – think that the Great Society – he was weakened by Vietnam, he was weakened by the backlash. And also, the Great Society laid the premise for I think the Republican philosophy of today. It was the 1966 election that elected a movie actor, the governor of California.

MR. ZELENY: So does that mean it was a success or a failure? I mean, like, did it – (inaudible) – objective sort of create a rise of what we’re seeing now today, is that responsible?

MS. TUMULTY: Well, obviously, it failed in a lot of areas, especially eradicating poverty. But interestingly enough, some of its greatest successes were the things that were most controversial in that day: civil rights. I think both the left and the right will acknowledge today that these barriers were impossible to knock over except by a government dictate. And this is something that only the federal government can do.

MS. IFILL: Seems to me that there are in – kind of enduring reverberations, not only in the things that you’ve mentioned, but also in the way that government functions. For instance, you pass something as huge as Medicare and Medicaid, you give people these kinds of entitlements, and they’re hard to let them go. So when 50 years later, we have a debate about health care, part of the pushback from Republicans was, we don’t want to pass this because once you give people something, it’s hard for them to give it up. Is it continuing to reverberate in other policy debates later?

MS. TUMULTY: It’s not – and it’s not just the benefits, it’s that around each of these programs, a big bureaucracy grows, and that that bureaucracy often outlasts the politicians.

MS. IFILL: I have another question about – but you guys can drop in because I’m so curious about this story, but also – but I find it interesting that part of the reason why LBJ was pushing this was he was saying this should – the government – the federal government should be the motivator, the operator. That is exactly the opposite of the conversation we’re having now where we’re saying, take it away from the federal government, send it to the states.

MS. TUMULTY: In part because he didn’t trust the states. In the middle of the civil rights movement, the states were the obstacles. But beyond that –

MS. IFILL: States’ rights being what it was in stopping civil rights.

MS. TUMULTY: But they also shifted power from the legislative branch to the executive, from corporations to regulators. And a really big one was shifting power around the big city machines and giving it to local community organizers, including one of whom now sits in the White House.

MR. WILLIAMS: Can I ask a quick question? In looking through all the Great Society contributions and successes, was there one little thing that you said, oh, I didn’t know that that was part of the Great Society?

MS. TUMULTY: You know, interestingly, the one big legislative fight that LBJ lost was over home rule for the District of Columbia. (Laughter.)

MS. IFILL: And we all live in Washington, D.C., now, and we think, oh, we still don’t have a voting member of Congress because that was the one thing that failed.

MS. TUMULTY: And he pulled out all the stops, and he couldn’t get it done.

MS. IFILL: So fascinating. Thank you, Karen, for doing that. It’s just one of those stories that we all kind of know perfunctorily, but we have no idea what the rhythm and the fallout has been all of this time later. That’s where you’ve been all these weeks. (Laughter.) Thank you, everybody.

The entire Washington Post Great Society series, you can find it on our website. That’s also where you’ll find our webcast extra, where we tackle all of the rest of the week’s stories that we didn’t get to hear – shocking, but there was more – including what the House did this week to rein in the NSA. You can watch the webcast all week long at pbs.org/washingtonweek. Also, keep up with daily developments with me and Judy Woodruff over at the PBS NewsHour. And we’ll see you right here next week on “Washington Week.” Have a lovely and observant Memorial Day. Good night.


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