updated 12/16/2005 10:23:01 AM ET 2005-12-16T15:23:01

Guests: Tom Tancredo, Frank Rich

TUCKER CARLSON, HOST:  Thanks to you at home for tuning in.  We always appreciate it.

Tonight President Bush hails today‘s vote in Iraq as a success and a major step forward.  Will the huge reported turnout reverse the president‘s disastrous slide in the polls? 

Also, why is this generation looking to aging icons like John Lennon and Bob Dylan for inspiration?  Why not raising up their own icons?  We‘ve got an alarming new look at trends for 2006, indicating that the country may be moving backward.  We‘ll bring you the details in just a minute. 

Plus the entire Eastern Seaboard and parts of the Midwest are preparing for wicked ice storms tonight, certain to create treacherous driving conditions. 

New Yorkers are already getting ready for a transit strike one hour from right now which, combined with the weather, could lead to massive travel problems for millions. 

Sleet and the freezing rain have already knocked out power to more than 350,000 homes from Atlanta, Georgia, to Charlotte, North Carolina. 

For more on this potential winter weather disaster we go live to Jeff Ranieri, who‘s standing by at NBC Weather Plus Center—Jeff.

(WEATHER REPORT)

CARLSON:  Thanks, Jeff. 

Now to Washington, where House members are moving forward on a bill that, for the first time in memory, literally the first time in decades, might slow the flood of illegal immigration into this country. 

The debate is still ongoing and will be into tomorrow, but the bill could wind up making a federal crime to enter and live in this country illegally. 

The legislation could also pave the way for construction of a fence along parts of the U.S. border with Mexico and also deny citizenship to children born in the U.S. to illegal aliens. 

(BEGIN VIDEOTAPE)

CARLSON:  Here now to discus the ongoing debate over illegal immigration, one of the most principled members of the entire Republican Party, Congressman Tom Tancredo of Colorado, joining us from Washington. 

Congressman, thanks for coming on. 

REP. TOM TANCREDO ®, COLORADO:  Thank you.  And with an intro like that I‘ll come on any time. 

CARLSON:  Good.  Well, that‘s the hope. 

I want to get your quick reaction to something that Vicente Fox, the president of Mexico, said today.  This was at an event right across the Texas border in Mexico.  The president, Fox, was speaking to a group of Mexican immigrants who had just come back into Mexico. 

He said, quote, “The disgraceful and shameful construction of walls, the increasing enforcement of security systems and increasing violation of human rights and labor rights will not protect the economy of the United States.”

And we went on to attack the United States by implication people like you for suggesting that we ought to tighten border security.  What‘s your reaction to that?

TANCREDO:  Certainly not surprising.  He is—he sounds like the chamber of commerce.  They sent out—the U.S. Chamber of Commerce, that is, sent out an almost identical sort of warning to all of us Republicans, anyway, saying that if we voted for this bill, this border security bill that we are presently debating, that that would be scored against us, that they—you know, watch out, you‘re not going to get support from business and labor. 

I mean, it is a money issue for both.  For big business in the United States, they make millions off of cheap labor and off of providing services for people who are here illegally. 

CARLSON:  Yes.

TANCREDO:  On the other side of the border, it‘s a money issue.  The $18 billion to $20 billion that Mexican nationals working in the United States, most of them illegally, are sending home to Mexico now comprises more money from—it is the largest source of foreign capital into the country of Mexico. 

CARLSON:  Larger than foreign investment?

TANCREDO:  Larger than foreign investment and last month anyway larger than Pemex. 

CARLSON:  That‘s the Mexican oil company. 

TANCREDO:  That‘s the Mexican oil company.  And so you can understand why all of a sudden Mexico turns from a country that 10 years ago used to look down on people who were coming into this country and there was a derogatory term that they would use.  It‘s like traitor.  People leaving Mexico.

To now pushing their human resources, pushing their people into the United States, and I mean it almost literally.  Tucker, they hire buses, the Mexican government, a ministry called the Ministry for Mexicans living in the United States.  And it hires buses and brings people up and will actually dump them off at the border and they walk right into the desert. 

It‘s the same organization, by the way, that produces those little booklets.

CARLSON:  Yes.

TANCREDO:  You know, that tells them how to avoid being caught and what to wear and all that sort of thing.  This is—the Mexican government aids and abets the people who are breaking laws coming into the United States. 

CARLSON:  Well, if that‘s true and I take you at face value, I believe everything you‘re saying is accurate, how can we consider Mexico an ally if the government of Mexico, as you said, is encouraging its citizens to break American law?

TANCREDO:  I had a great argument one time with a gentleman by the name of Juan Hernandez who was at that time the minister of that ministry that I just mentioned, the Ministry for Mexicans Living in the United States.

And I asked him that very question.  What he told me the purpose of his ministry was to push people into the United States, it was to—by the way, it was also AFC work with them so that they did—he was with the community, he said.  He was three days a week in the United States, four in Mexico. 

By the way, he himself is a dual citizen born in Texas, university—teaching at the University of Texas and on the Vicente Fox cabinet.  And he said, “I work with the community in the United States, the Mexican community because I don‘t want them essentially going native on us.  We want them continually tied emotionally, linguistically, politically to Mexico, because then they‘ll continue to send money home.” 

And I said to him, that does not sound like—you know, you‘re doing something that‘s actually the act of an unfriendly government. 

CARLSON:  Well, of course, it doesn‘t in any way serve American interests.  It undermines our country in a pretty direct and direct and obvious way. 

TANCREDO:  Tucker, his response.  Let me tell you his response. 

CARLSON:  Yes.

TANCREDO:  At the end he goes, “Congressman,” in an incredibly condescending way.  He goes, “Congressman, it‘s not two countries; it‘s just a region.” 

CARLSON:  That is not my view, to put it mildly. 

TANCREDO:  Not mine either. 

CARLSON:  Now Congressman, tell me about the battle going on on Capitol Hill right now over this immigration and security bill.  You‘re taking a position contrary to that of the White House I think and not for the first time. 

You‘d like to see people who violate federal immigration law be in violation of federal law.  Right?  You make them criminals under federal law.  The White House is opposed to this.  What‘s going to happen?

TANCREDO:  Yes.  Well, I don‘t know.  The answer is I don‘t know what‘s going to happen, but that‘s only one of many, many things that we‘ve got in a bill that‘s before us now. 

This is going to be perhaps the most—well, no—there‘s no perhaps to it.  It is going to be the most important immigration battle we have had in the Congress since I‘ve been here.  And it will be certainly the biggest battle of this year because we‘ll be heading out of here after it‘s over with. 

And I only hope that we can be able to come home and tell the American people we‘ve done something significant.  We have actually imposed a penalty on employers who are hiring people who are here illegally.  We have told them that they‘re going to have to use the verification system, the Social Security verification system that is now voluntary.  We‘re going to make that mandatory.

We‘re going to stop catch and release.  We‘re going to—we‘re going to abolish the visa lottery system that allows all these guys to come in from countries of interest like, say, Saudi Arabia and Pakistan. 

CARLSON:  Right. 

TANCREDO:  There‘s a whole bunch of things in this bill that I hope we can hang onto, but it‘s a flip of the coin right now as to what‘s going to happen. 

CARLSON:  You wonder how it can happen, considering, as you said a couple of minutes ago, the Chamber of Commerce is adamantly opposed to this.  And let‘s be honest, you know, business funds Republican campaigns.  Republicans can‘t run for office without the support of business. 

It‘s not a slur, it‘s just a fact.  How can Republicans stand up in the face of opposition from business and vote for this?

TANCREDO:  Believe me, Tucker, you have hit it on the head.  This is going to be one of the most interesting votes I have taken since I‘ve been in Congress, because it does pit what is usually not our base necessarily but certainly an economic part of the Republican Party‘s influence, against the folks who want to do something and are afraid to go home to their districts without doing something. 

I mean, this is the ultimate fear, are you going to—are you going to try to cater to the business interests of this country or are you going to go home and answer your constituents when they say to you, “What the hell were you doing up there?  We have to have those borders secure, and you‘re just playing around and you‘re caving in to big business and big money.” 

Well, that‘s going to be a tough sell.  And so you know what?  I think they‘re going to pretty much come our way and...

CARLSON:  I hope—I hope you‘re right.  I hope you‘re right.  It‘s going to take a lot of courage to do that.  I know you‘ll do it.  Tom Tancredo from Colorado.  Thanks a lot for joining us. 

TANCREDO:  Thanks, Tucker.  It‘s a pressure. 

CARLSON:  Thanks.

(END VIDEOTAPE)

CARLSON:  Still to come, results of the highly anticipated Iraq election not expected for weeks but have they already helped the politically ailing George W. Bush?

Plus, the story you haven‘t heard about the president and how he responded to the terrorist threat right after 9/11.  It involves tapped phones and monitored e-mails.  We‘ll give you all the details next.

(COMMERCIAL BREAK)

CARLSON:  Coming up, did President Bush secretly lift limits on spying within this country after September 11? 

And when is Canada going to stop saying nasty things about us?  Isn‘t it time we invaded that Molson soaked tundra to the north?  Those debates and more when we come back. 

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  This is a major step forward in achieving our objective, which is an ally having a democratic Iraq, a country able to sustain itself and defend itself, a country that will be an ally in the war on terror and a country which will set such a powerful example to others in the region. 

(END VIDEO CLIP)

CARLSON:  That was President Bush speaking earlier today from the Oval Office.  He was flanked by Iraqi citizens who cast their votes in the country‘s first official parliamentary election. 

Here to talk about whether that election is as much a turning point for President Bush as it is for Iraq, Air America radio host the great Rachel Maddow—Rachel. 

RACHEL MADDOW, AIR AMERICA RADIO HOST:  Hi, Tucker.

CARLSON:  Welcome.

MADDOW:  Nice to see you. 

CARLSON:  Nice to see you. 

We don‘t know who won, whether lunatics were installed in office or not.  What we know so far is that turnout was really high, according to “The New York Times.”  Apparently, the turn out was about 70 percent of the country, 11 million people.  That‘s what they think at this point. 

It raises the question, and I say this as a profound opponent of the war, someone who thinks the war was unwise and has been prosecuted ineptly, to put it mildly—it raises the question, maybe Bush is right in all this democracy talk. 

We should at least entertain the possibility that when Bush says all people yearn for representative government and freedom, I‘ll admit I scoff at him.  I don‘t think all people yearn for freedom, actually.  I think they yearn for stability, but maybe he‘s right.  Maybe he is.  I don‘t know.  Shouldn‘t we keep an open mind?

MADDOW:  Well, you‘ve always said that—everybody in the world would say a democratic Iraq is a good thing, that a free country in Iraq is a good thing, that not having a dictator is better than having a dictator as long as the Iraqi people are deciding their own fate. 

The question is, is building democracy in Iraq worth a half a trillion U.S. dollars and 2,200 U.S. lives?

CARLSON:  Right.

MADDOW:  And if that was the project from the beginning, as Bush is now trying to claim—he‘s now saying, “I would have gone without the weapons argument.  I would have gone—we always meant to do more than just topple Saddam.”

CARLSON:  Right. 

MADDOW:  Well, he should have made that case.

CARLSON:  I think—to be fair, he did concede yesterday that the weapons argument was central to the rationale for war and that it was wrong. 

MADDOW:  But he said—he said even with—on FOX yesterday, he said, “Even without the weapons question I still would have gone.”  On the night that we invaded Iraq he sat there in the Oval Office and said we are invading because of weapons. 

CARLSON:  I remember very well. 

MADDOW:  Making it up.

CARLSON:  I remember where I was sitting at the time. 

MADDOW:  Yes.

CARLSON:  But here‘s the question going forward. 

MADDOW:  Yes.

CARLSON:  How important is it to the United States that Iraq not become a cesspool of chaos and violence?  Very, very important. 

MADDOW:  Yes.

CARLSON:  I was having an e-mail exchange today with one of the smartest people I know, Matt Labash, who‘s a reporter at “The Weekly Standard,” conservative, violently opposed to the war since the time he spent in Iraq. 

And he wrote this.  I said, “What if Bush is right?”  He wrote this. 

He said, “If Bush ends up being right about Iraq it will be through luck and accident and God‘s grace, not through any skillful calculation of his own.  Success there will make him a great president the way Powerball makes crack heads rich.  They have the money to show for it but they‘re not fooling anyone.” 

I thought you know what?  Matt Labash is probably right.  I don‘t care.  All I want is success.  Because disaster in Iraq means disaster here.

MADDOW:  Yes.

CARLSON:  And I so fervently want this to work, because I so fervently don‘t want Iraq to cause New York lose its place in the world to become a, you know, second world country, become Canada, right, but with more people.  I just don‘t want that to happen. 

MADDOW:  The question—the question, though, is what does “this working” mean?  Everybody wants a positive outcome in Iraq, everyone wants a positive outcome in this election. 

I‘m such a sap for democracy and politics that I get weepy when I see anybody voting.  You know, it‘s true. 

But when you get out of soft focus here, when you‘re kind of off the Good Ship Happy Talk from the White House about this being this major milestone, you run up against this very hard truth that, even if the Iraqis today elect themselves 500 Thomas Jeffersons, even if they elect themselves into the most ideal possible situation, U.S. troops are still not coming home. 

CARLSON:  Yes.

MADDOW:  This is a politically important election for Bush to help with this week‘s, you know, “I‘ve got a plan: happy talk talking point, but the plan is not to bring U.S. troops home. 

CARLSON:  All you need is a trajectory politically. 

MADDOW:  Yes.

CARLSON:  This war, even if it‘s a success, and I talked to somebody who got back from Iraq today, who said, actually, we are winning in the same way that 1972 there was a lot of evidence we were winning the war in Vietnam militarily, but it didn‘t matter, because we lost it politically so we had to come home. 

I think this war is winnable politically if there is a positive trajectory, if it looks obvious that things are getting better.  That‘s all.

MADDOW:  It‘s all about what it looks like, though.

CARLSON:  Yes.

MADDOW:  And what we‘re seeing now is we‘re seeing, “We‘re halfway there.  We‘re making progress.  This is a benchmark.  This is a milestone.”

You know what?  If there really are benchmarks and milestones there‘s a very, very easy test about whether they have a plan about whether we‘re getting out of Iraq.  Tell us in advance what those milestones are, how many brigades we need, how much electricity there has been, how much oil has to be pumped...

CARLSON:  They don‘t know, come on.  That‘s an impossible task. 

MADDOW:  It‘s an impossible task because they‘re not coming home. 

They don‘t want them to come home. 

CARLSON:  That may be true, but they‘re there.  So if things do get better in Iraq, I‘m saying as someone who thinks the war was a mistake.  I‘m saying that is cause for us all to have a huge party.  It‘s a big deal if things get better.  Because if they don‘t get better, our country is going to be hurt for generations. 

MADDOW:  The secret, though, is that if things get better or if get worse, no matter what, the Bush administration has no plan to bring U.S.  troops home in our lifetime, I believe. 

CARLSON:  Well, they‘re not going to be around for a lifetime.  So that‘s not—OK.

MADDOW:  I‘d sign up your great grandkids for infantry uniforms right now. 

CARLSON:  I almost hesitate to bring this story up, because it gives so many openings.  OK?  However, you have to, because this actually is breaking news.  It‘s from “The New York Times,” and it‘s out in tomorrow‘s edition.  Just pulled it...

MADDOW:  Incredible story. 

CARLSON:  ... off the Web.  That‘s right.  This is a story that—it‘s very, very, long but the essence of it is this.  The National Security Agency, the NSA, which for a long time has been prohibited, since I think at least Vietnam, or from its inception, actually, from spying in the United States, from tapping phone calls in the U.S. ...

MADDOW:  Abroad only. 

CARLSON:  Has since 9/11 been tapping the phone calls of some suspected terrorists who are calling internationally from the United States out of the country.  They are claiming, the NSA and the Bush administration, and the “Times” appears to think it‘s right, too, they that they have intercepted plots, at least two noted in this story, to cause acts of terror in this country. 

MADDOW:  Well, hundreds if not thousands of Americans calling abroad, they‘re eavesdropping.  E-mailing abroad.

CARLSON:  That‘s right.  That‘s exactly right.  They say they‘ve uncovered terrorist plots. 

This is one of those things that, if executed in a very precise way, would bring me joy.  The idea that they‘re uncovering terrorist plots.  I‘m just not sure I trust the federal government not to trample on civil liberties.  That‘s the problem. 

MADDOW:  The reason that this is a huge story and reason that “The New York Times” had to sit on this, they say, for a year and there are parts of this they still can‘t leak—I mean, this sounds like there‘s been a lot of back and forth between the “Times” and the White House on this. 

The reason that this is controversial is because after Vietnam there‘s all of this controversy over the Pentagon spying on anti-war protestors. 

CARLSON:  Right.

MADDOW:  That‘s why you‘re not supposed to be able to do that. 

There‘s all these rules about inside...

CARLSON:  Antiwar protestors actually sabotaged and caused a huge amount of damage to military installations and military property during the war.  I‘m related to someone who caused some of that damage.  I mean, it was real.  I mean, there was a reason.  I‘m not defending it, but I‘m saying it was not because they didn‘t like the politics of the protesters.  The protesters were violent in a lot of cases. 

MADDOW:  Well, but there‘s also—there are rules about what happens with domestic spying.  Right?

CARLSON:  Right.

MADDOW:  You‘re a libertarian guy.  You‘re not a big government guy. 

CARLSON:  No, I‘m not. 

MADDOW:  And so there‘s this ideas that you have to get permission from a special court, from the FISA court, the special court set up, if you want to have these agencies spying on Americans.  The Bush administration did away with that and never told us. 

CARLSON:  Not spying on Americans, spying on people in the United States.  Domestically, it doesn‘t matter their nationality. 

MADDOW:  Well, yes.  But in some cases they are American citizens. 

CARLSON:  Right.

MADDOW:  The fact that you‘re making an international phone call or an international e-mail, you‘re e-mailing somebody internationally, opens you up to being spied on by the U.S. agencies that used to be only operate overseas.  That‘s a big change in how big our government is. 

CARLSON:  Well, operate overseas without a warrant.  I will just say I think it‘s going to take awhile to figure out what this all means and doubtless this story will be followed up by other stories that tell us more. 

Two very quick things.

One, “The New York Times” showed some restraint in this.

MADDOW:  Sure.

CARLSON:  So that all the people who say, you know, “All the media hates America.”  A lot of the media does hate America but this is a case of, actually, the press doing its best, I think, to do the right by national security.  So good for them.

And second, this is going to cause a huge spike in the number of conspiracy nuts out there, which is bad. 

MADDOW:  Well, seriously, that‘s people worried who are about big government, a very secretive government.  There‘s lots of big—big increase in domestic surveillance.  They‘re looking at our library records.  They‘re looking at our book store records.  They‘re monitoring our protests.  I‘m turning into a conspiracy theorist.  Bush‘s America will do that to you. 

CARLSON:  Bush‘s America.  I wish we had more time.  I didn‘t even vote for him the second time, and I feel like I got to defend him.  But I‘m with you, Rachel.  Rachel Maddow.

MADDOW:  That‘s my job.  That‘s my job...

CARLSON:  I appreciate it.

MADDOW:  ... making you defend this clown. 

CARLSON:  Thank you.

MADDOW:  Thanks, Tucker.

CARLSON:  Still to come, how will Hurricane Katrina affect made in the USA products, and will television as we know it be a thing of the past?  Looking at trends for 2006, a really interesting segment.  Stick around. 

We‘ll be right back. 

(COMMERCIAL BREAK)

CARLSON:  Welcome back. 

Are Americans on the verge of a frenzy to downsize, and will moldy oldies make yet another comeback in 2006?  Here to answer those questions and more, Gerald Celente, director of the Trends Research Institute.  His group has been forecasting trends for the past 15 years.  He joins us tonight in studio. 

Joe, thanks a lot for coming on. 

JOE CELENTE, DIRECTOR, TRENDS RESEARCH INSTITUTE:  Thanks. 

CARLSON:  So, what is this—you have in your report a prediction, but sounds like more than a prediction, that television and the way we watch is going to change dramatically in the next year. 

CELENTE:  Well, each year we come out with the top trends of the next year, “The Trends Journal.”

CARLSON:  Yes.

CELENTE:  And what we‘re saying, this is a big year in 2006.  We call it online TV.  There‘s a lot of talk now about how, you know, the multimedia is going to go beyond iPods and cell phones. 

CARLSON:  Right. 

CELENTE:  Well, take at this time other way.  You‘re taking everything off the World Wide Web and now you‘re putting it onto the wide screen of your house.  That‘s where the big convergence trend is going to change everything.  And there‘s the technology already, TiVo has it. 

CARLSON:  Right.  But how will that change—I mean, what will that mean for the average person coming home after work?  How will his TV viewing habits change?

CELENTE:  I can watch anything in the world from anybody.  Because the cost of production goes way down.  Content becomes king. 

Right now you have the major broadcast corporations that are in control of distribution. 

CARLSON:  Right.  Right.

CELENTE:  Now distribution becomes—it‘s free.  You got your—you‘re on the Web.  You have a production facility.  You‘re putting out content.  There is no FCC.  It‘s worldwide. 

And I want to listen to a Danish station, bam, it‘s there.  I want to hear music from around the world I tune in whatever.  I have a World Wide Web of viewer broadcast quality.  You see that‘s what we were talking about back in the dot com era.

CARLSON:  Right.

CELENTE:  The convergence, the technology wasn‘t ready yet.  Now it‘s ready.  So 2006 is going to be the beginning of that. 

CARLSON:  And it‘s all on demand. 

CELENTE:  Yes.  It‘s what you want. 

CARLSON:  I‘m for that.  I‘m totally for that. 

CELENTE:  So you have your remote and you‘re sitting there.  You don‘t have 500 channels; you have 500,000 channels. 

CARLSON:  Yes.  That kind of blows my mind.  A trend that you address a lot, cultural, pretty broad cultural trends.  This confused me.  You say that younger people will continue to look backwards for their cultural idols. 

CELENTE:  Actually, I‘m been forecasting trends at Trends Research Institute 25 years.  In modern history there‘s never been a generation that‘s looking to the past to find its future.  For example, I‘m a Baby Boom generation. 

CARLSON:  Right. 

CELENTE:  We weren‘t looking back to Glen Miller and Benny Goodman and Louis Armstrong.  It was The Beatles.  It was The Doors.  It was Elvis Presley, Fats Domino. 

The next generation, Generation X, they weren‘t looking back to Fats Domino, Elvis Presley for their music.  They weren‘t looking back to that generation for their politicians.  They weren‘t looking back for that generation for their culture.  They were inventing their own. 

This generation, the millennium generation, born between 1980 and 1995, they‘re looking back.  From Dylan to Lennon, from Kennedy to King, they‘re looking back to the past to find their future. 

They don‘t have it.  They don‘t have the musicians with the chops. 

They don‘t have the cultural idols that are alive today. 

CARLSON:  They see America as...

CELENTE:  Better then than now. 

CARLSON:  Right.  Exactly.

CELENTE:  The future—the past is better than the future.  And there was a soul then.  There was a feeling of a soul.  Right now there‘s a trend that we call Deadmerica.  America has lost its soul.  And you look around the country.  I‘m old enough to remember.

CARLSON:  Lost its soul?

CELENTE:  Well, I‘ll tell you how.  New York has turned corporate. 

Again, I‘m a New Yorker, a Bronx New Yorker.  I know what it looked like. 

New Orleans is nevermore.  Hollywood‘s lost its tinsel.  And Miami‘s hot but doesn‘t have the heat.  Look at the movie business.  They have to bring back the monkey for the third time. 

CARLSON:  You know why?  Do you know why?

CELENTE:  There‘s nothing else. 

CARLSON:  Because America is moving to Orlando and Phoenix and Tempe and Corpus Christi.  It‘s just, you know, the population centers are changing. 

Let me ask you about downsizing.  You say that Americans, they moved into these McMansions.  This have these enormous vehicles, and all of a sudden, people are going to decide they want to go micro, everything‘s smaller. 

CELENTE:  They have no choice; that‘s the part of it.  Americans don‘t understand, really, what‘s happening. 

You know, globalization has changed everything.  Americans like to think we‘re No. 1.  We‘re not No. 1 anymore.  People better grow up about this.  We‘re 300 million people in a sea of 6.3 billion.  We‘re not No. 1 in health care.  We‘re not No. 1 in education any longer.  We‘re not...

CARLSON:  That‘s a total crock.  Come on.  We‘re not No. 1 in health care?  Are people flying to India for life-saving operations?

CELENTE:  Let‘s talk numbers.  I talk numbers. 

CARLSON:  We‘re almost out of time.

CELENTE:  All right.  We‘re No. 37, according to the World Health Organization. 

CARLSON:  But they hate us.  Come on.  Please. 

CELENTE:  Don‘t be silly. 

CARLSON:  I‘m not silly.  It‘s true. 

CELENTE:  To say they hate us. 

CARLSON:  They do hate us.

CELENTE:  That‘s a value judgment. 

CARLSON:  I‘m in the business of value judgments and that‘s an absolutely correct value judgment. 

CELENTE:  I‘m in the business of facts, so that‘s where we‘ll end it. 

So let‘s move ahead.

CARLSON:  Ok, you win. 

CELENTE:  All right.  So now what‘s going on in America is that when you look at a real number again, according to the Census Bureau, hardly a left-wing organization...

CARLSON:  Right.

CELENTE:   Median income is at 1999 levels. 

CARLSON:  Right.

CELENTE:  Yes.  Ok, so people can no longer afford what they want. 

It‘s what they need. 

CARLSON:  They‘re massed out on credit.

CELENTE:  Exactly.  You know all the numbers. 

CARLSON:  So right, when the foreclosure comes, they...

CELENTE:  Again, less is more.  It‘s not bad.  You don‘t need big. 

You need nice. 

CARLSON:  I agree. 

CELENTE:  Good quality.  You need things that you can fix when they‘re broken, not dispose of them. 

CARLSON:  I‘ll believe that part when I see it, but it doesn‘t sound bad to me.  Joe Celente, the director of Trends Research Institute.  Thanks a lot for coming on. 

CELENTE:  Thank you.

CARLSON:  I appreciate.  Still to come hidden cameras in the boys‘ bathroom and it was the principal, not a creep who put them there.  Details when THE SITUATION returns.

(COMMERCIAL BREAK)

CARLSON:  Welcome back. 

That great philosopher anonymous once said, never argue with a fool.  People might not know the difference.  Well, there‘s no danger of that here, here being any place we‘re joined by the great Max Kellerman, our “Outsider,” of ESPN Radio and HBO boxing, joining us tonight from Las Vegas -- Max.

MAX KELLERMAN, ESPN RADIO TALK SHOW HOST:  You know, it‘s funny.  That philosopher, anonymous, has more great quotes I think than all other philosophers combined. 

CARLSON:  Plus, his appear on bathroom walls and subway stops.  I mean, that guy is prolific.

KELLERMAN:  He‘s everywhere.  He‘s everywhere. 

(CROSSTALK)

CARLSON:  ... Amazing. 

All right, first up, a war of words gets heated, and it sounds like our neighbors to the north are mad.  That, of course, would be Canada, for those of you following along at home.  The prime minister of that country, Paul Martin, says he will—quote—“not be dictated to” by the U.S.  over, of all things, lumber tariffs, which are a big deal in Canada. 

It‘s the latest salvo in an increasingly pitched battle that had David Wilkins, our ambassador to that country, strategy—quote—“It may be smart election-year politics to thump your chest and criticize your friend and your number-one trading partner constantly, but it‘s a slippery slope.  And all of us should hope it doesn‘t have a long-term impact on the relationship.”

Here‘s the problem, Max.  Here‘s the problem with telling Canada to stop criticizing the United States.  It only eggs them on.  Canada is essentially a stalker, stalking the United States, right? 

(LAUGHTER)

CARLSON:  Canada has little pictures of us in its bedroom, right?  Canada spends all of its time thinking about the United States, obsessing over the United States.  It‘s unrequited love between Canada and the United States. 

We, meanwhile, don‘t even know Canada‘s name.  We pay no attention at all. 

KELLERMAN:  Well...

CARLSON:  Canada thinks we‘re married; we don‘t know it exists.  Every time we tell Canada to knock it off, it just feeds the fire. 

KELLERMAN:  Well, yes.  I very much like your “Canada, the adults are talking” stance.  I—I like that. 

(LAUGHTER)

KELLERMAN:  However, we really do have to engage them on this.

And this is—this is the devil‘s-advocate position, but I may actually believe this. 

CARLSON:  All right. 

KELLERMAN:  They make us look bad internationally.  And it‘s really not fair. 

We have the—the longest, friendliest border, you know, for the—for the longest time in the history—in recorded history, really, with Canada.  And they get to sit on their moral perch, you know, take the moral high ground, say, oh, United States, shame on you about Iraq. 

They—they had—they must take no—virtually no responsibility, certainly in terms of their military, around the world.  We have to do all the heavy lifting.  And then to have them, our—one of our really strongest allies, when you think about it, internationally...

CARLSON:  Oh.

KELLERMAN:  ... to the north, constantly criticizing us and making us look bad internationally, it needs to be addressed. 

CARLSON:  First of all, anybody with any ambition at all, or intelligence, has left Canada and is now living in New York. 

Second, anybody who sides with Canada internationally in a debate between the U.S. and Canada, say, Belgium, is somebody whose opinion we shouldn‘t care about in the first place.

Third, Canada is a sweet country.  It is like your retarded cousin you see at Thanksgiving and sort of pat him on the head.  You know, he‘s nice, but you don‘t take him seriously.  That is Canada.

KELLERMAN:  No, you don‘t.  You don‘t.  But what if the rest of the family does?  In other words, yes, the United States can rely on...

CARLSON:  That‘s their problem. 

KELLERMAN:  ... England, Australia, Israel, a few staunch, important allies internationally.  But we have lost a lot of international support.

And Canada, by others in the global family, is, for some reason, taken seriously.  They have about 30 million people.  They have some natural resources. 

CARLSON:  Oh.  They have dogsleds and trees, and that‘s it.

KELLERMAN:  And comedians.

CARLSON:  Look, I like Canada.

KELLERMAN:  Tucker, they have comedians.

CARLSON:  Every single comedian in Canada is now living in the United States. 

KELLERMAN:  Well, that‘s true.

CARLSON:  Every one of them.  They sneak over the border and live among us unseen.  It‘s actually kind of scary. 

All right. 

A Kansas student could be kicked out of high school for removing a hidden camera he found in the boys bathroom.  Charles Roger discovered the camera in the foyer of the boys bathroom.  And he said it looked like a spy camera.  He didn‘t think it belonged there, so he took it.  Well, it turns out that camera was there to catch graffiti artists. 

The school now admits it was a mistake, but Rogers could be expelled for taking the camera. 

Rogers said later to a reporter, he thought the camera was placed by -

quote—“a perverted janitor,” which sounds about right. 

The school has no place kicking this kid out.  You put a spy cam in the john?  You‘re the creep, buddy.  You‘re the weirdo.  You‘re the one who ought to be embarrassed, not the guy who does the good deed by taking it down. 

KELLERMAN:  Well, I don‘t know where exactly it was positioned in the boys bathroom. 

I mean, and—and you‘re right.  Calling it—he‘s called it—he thought it was a spy camera.  You called it a spy camera.  It is a spy camera.  The school is spying on their students.  And, as despicable as you may think that is, the fact is, when you‘re a kid and you‘re at school, you‘re not at home.  You‘re at your job. 

CARLSON:  That‘s right. 

KELLERMAN:  That‘s your—that‘s—that‘s your job.  That‘s your workplace.  And your employer, it‘s been shown time and again, has the right to spy on you in the workplace. 

CARLSON:  Yes, I—I agree with that.  I don‘t think kids have any rights at all.  And I am always arguing against those who claim otherwise. 

However, this kid thought he was doing a good deed.  Everybody knows that only creeps put cameras in the bathroom.  That is what we know.  And, frankly, I would like to hear a real explanation for why this camera was in the bathroom.  Stopping graffiti artists?  Please.  I think someone was really enjoying looking at the tape from this camera.

(CROSSTALK)

CARLSON:  But the bottom line is, this kid thought he was helping. 

KELLERMAN:  I mean, first of all, who cares about graffiti in the boys bathroom?

CARLSON:  Exactly. 

KELLERMAN:  And, secondly, it‘s a school—I mean, this is no longer the devil‘s-advocate position.

But to support you—and you‘re clearly right about this—it‘s a school.  These are underage boys.  What are they doing spying on them in the bathroom? 

CARLSON:  I know.

KELLERMAN:  Tucker, it‘s craziness. 

CARLSON:  I completely—I completely agree.  I think we need an investigation into this, Max. 

KELLERMAN:  I agree.

CARLSON:  I don‘t even want to know the results.  Just—oh, it gives me the willies just thinking about it. 

Max Kellerman in Las Vegas for us tonight—thank you, Max.

KELLERMAN:  Thank you. 

CARLSON:  Well, there is still plenty more ahead on THE SITUATION. 

(BEGIN VIDEOTAPE)

(MUSIC)

CARLSON (voice-over):  A fowl of nature, a wild tale of one wayward bird who refused to fly straight and just say no. 

UNIDENTIFIED MALE:  And the owl was stoned. 

CARLSON:  Then, watch what happens when hot-tempered soccer fans refuse to let their home team get kicked around. 

Plus, age-old proof that beauty is only skin deep, especially if that skin is very, very wrinkled. 

UNIDENTIFIED FEMALE:  You take off your clothes, you get acquainted more. 

CARLSON:  Then, one elephant‘s brush with fame.  But wait until you see why some of this artwork really blows. 

It‘s all ahead on THE SITUATION. 

(END VIDEOTAPE)

(COMMERCIAL BREAK)

VANESSA MCDONALD, PRODUCER, THE SITUATION WITH TUCKER CARLSON:  Coming

up, are you looking for a last-minute gift for that special drunk in your life?  How about a subscription to “Modern Drunkard” magazine?

CARLSON:  I will saddle up to the bar with the editor of that monthly that celebrates alcohol and the people who abuse it.

We are back in 60 seconds.

(COMMERCIAL BREAK)

CARLSON:  Welcome back. 

My next guest‘s life philosophy is pretty simple.  Alcohol makes us better human beings.  For nearly 10 years now, he‘s been speaking to people, mostly drunk people, who share his view of the world in the pages of “Modern Drunkard” magazine. 

Frank Rich is the founder and editor of that magazine.  He‘s also the author of the book “The Modern Drunkard: A Handbook for Drinking in the 21st Century.”  He joins us live tonight from Denver.

Frank Kelly Rich, thanks for coming on. 

FRANK RICH, FOUNDER & EDITOR, “MODERN DRUNKARD”:  My pleasure.  

CARLSON:  You look very sober.  Are you? 

RICH:  I had a few earlier.  But, as far as you know, I‘m...

(CROSSTALK)

(LAUGHTER)

CARLSON:  I‘m impressed. 

(LAUGHTER)

CARLSON:  Let me say, I think your magazine is one of the most amusing things I have ever read.  The August issue, just for instance—this is—this is the masthead of—on—on the outside.  “Perpetrating the Weekend Getaway.”  “Plastered Propaganda.”  “The Six Circles of Hangover Hell.”  “What‘s Your Intoxication Quotient?”  And “Ladies Thirst,” a salute to the great heroines of hooch. 

Who reads—who reads this and who reads your book?  Drunk people? 

RICH:  It‘s—it‘s the voice of the recreational drinker. 

It‘s—there are actually a lot of drunks out there.  And, up until now, they didn‘t really have a magazine dedicated just—you know, just to them. 

CARLSON:  Isn‘t that what, like, pornography is for, drunk people? 

(LAUGHTER)

RICH:  No.

I mean, they actually—they like to read about, you know, actually, drinking, and the etiquette of drinking, and how to behave properly, and the history, and the great heroes of drinking. 

CARLSON:  Well, what is—there are a lot of heroes of drinking. 

RICH:  Absolutely. 

CARLSON:  Most of them had kind of depressing lives at the end. 

But what—well, tell me about the etiquette of drinking.  Let‘s say you‘re a drunk.  What—give me some rules you ought to observe. 

RICH:  Well, we teach you how to tip properly, and how to behave around women, and how to treat the bartender, and how to behave in general when you‘re actually drunk.  We even have sections on how vomit properly and how to treat, you know, your fellow man while you‘re inebriated. 

CARLSON:  What—what about your spouse?  Most—most drinkers I know are men.  I mean, does your spouse have to be on board?  A lot of women resent it.  What does your wife think? 

RICH:  It really helps to have her on board.  My wife, she drinks as often as I do, but possibly not as much. 

CARLSON:  Huh.

RICH:  But she‘s—she‘s—she‘s completely on board.

CARLSON:  Do you think women make as appealing drunks as men? 

RICH:  Well, when I was single, I certainly thought so. 

I mean, if you‘re in a bar and you‘re—and you‘re getting drunk, absolutely.  But, yes, I—they—they tend to get drunker faster because of metabolism and body differences.  But, yes, there‘s—it‘s a lot of fun to have the girls around when...

(CROSSTALK)

CARLSON:  Well, you say that drinking enhances creativity.  I found I could never write—or at least write very well—when I was drinking. 

RICH:  No.  You—you can‘t write with structure when you‘re drinking. 

I usually caffeine for that effect.  But that‘s when you get all your great ideas.  When—when the subconscious fully opens up is when you‘re drinking.  That‘s why you write down on bar—you know, on—on bar napkins and then, later on, and, the next day, you try and interpret the gibberish.  And that‘s why I carry around a tape recorder now. 

CARLSON:  But that‘s the problem, though.  You can‘t write when you‘re hung over, either.  So, it becomes this kind of vicious cycle of inactivity and drunkenness. 

RICH:  No.  I—I write—I write fine when I‘m hung over.  It‘s—it‘s a very cynical time.  So, you—you get rid of all those little darlings in your—in your writing.  That‘s—that‘s when you get—you get your hard edge. 

CARLSON:  Now, I‘m sure...

RICH:  Good—good time to edit. 

CARLSON:  We are going to get a lot of hate mail about this segment...

(LAUGHTER)

CARLSON:  ... from people whose lives have been destroyed by drinking or people who have seen what alcoholism does. 

What—I mean, alcoholism is a problem.  I have known people who have wrecked their lives and the lives of their families.  Are you bothered by that? 

RICH:  It‘s not for everybody.  That‘s for sure. 

And that‘s why I‘m—I‘m—I‘m personally glad there are organizations like AA, sort of a safety net to catch those people, because some people are just not cut out for drinking.  But—and, also, I would rather have those guys in the AA meeting than at the bar, you know—you know, dragging everybody else‘s good time down. 

And those people that—that don‘t want to drink, and it‘s not cut out for them, if they want to go, you know, be sober the rest of their lives.  But I think there is—there is a hard core of us that actually—guys that drink every day.  And they‘re functional alcoholics, and they get their jobs done, and they have a great time. 

I mean, there should be good times interrupt the long gray lockstep toward the prison of death. 

(LAUGHTER)

RICH:  Don‘t you think?

CARLSON:  Nicely put. 

(LAUGHTER)

CARLSON:  So—so, you edit what I think, as I said, is a terrific magazine.  You wrote an excellent book.  How much do you drink? 

RICH:  It varies, you know?

I‘m not lying, like, falling off a bar stool at noon every day.  I usually save that for later in the evening.  But, some days, I will have like, you know, four drinks.  Some days, I will have, you know, 30.  It—it depends on the—the circumstance.

(CROSSTALK)

CARLSON:  Do—do you ever have a day without alcohol? 

RICH:  It—I remember it was about three weeks ago, that happened. 

It was—it was frightening. 

(LAUGHTER)

CARLSON:  OK.

RICH:  I‘m just kidding.  No.  No.  Occasionally, like, once a week or so, I will—I will forget to drink.  I will have too much to do. 

CARLSON:  Boy, I hate when that happens. 

RICH:  Oh, it‘s...

(CROSSTALK)

RICH:  ... terrible.

CARLSON:  Frank Kelly Rich, author of “The Modern Drunkard: A Handbook for Drinking in the 21st Century,” a very amusing book, thanks a lot for coming on. 

RICH:  My pleasure. 

CARLSON:  Coming up on THE SITUATION, what is that white bundle being thrown from a burning New York City building?  We will show you one of the most dramatic rescues you will ever see when THE SITUATION rolls on.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE:  Hello?

(END VIDEO CLIP)

CARLSON:  Hello?  That‘s my voice, by the way. 

Time for our voice mail segment, where we play the many messages you leave while we sleep. 

First up:

(BEGIN AUDIO CLIP)

JEFF:  Jeff Enuego (ph).  And I‘m calling in response to watching the seat belts.  And I totally agree with you guys.  Seat belt laws are just another reason for the police to pull you over to check for drunk drivers, drugs, and perform other illegal searches of your vehicles. 

(END AUDIO CLIP)

CARLSON:  Couldn‘t agree more, Jeff.  I notice you didn‘t leave where you live, probably a little paranoid—but also a revenue enhancer, like a lot of traffic stops.  It‘s a way for municipalities to raise money.  Now, let‘s just be honest about it.  They‘re taking your money in the name of keeping you safe.  It‘s a lie. 

Next up:

(BEGIN AUDIO CLIP)

HARRISON:  This is Harrison in Dallas, Texas. 

I just wanted to comment on the lady the other night that called you a racist.  Maybe it‘s the fact that you had a sheltered upbringing, but you have to admit, you are consistently callous to your African-American, Latino and Middle Eastern guests. 

I had more respect because you refuse to compromise your beliefs.  But, yesterday, you weakly refused to comment.  Stand up for what you believe in.  Since when did you start to care what others thought of you?

(END AUDIO CLIP)

CARLSON:  Well, I‘m kind of confused. 

I‘m—I‘m—I‘m harsh on everybody, I think.  I—I don‘t single anybody out.  And I think I always stand up for what I believe in.  Call back and explain what you mean. 

Next up:

(BEGIN AUDIO CLIP)

ROY:  Roy Sebastian (ph) from Hartsburg, Illinois. 

I do believe in the death penalty.  And I believe the reason it‘s not a deterrent is because people are not put to death within the first year of their being found guilty of the crime. 

(END AUDIO CLIP)

CARLSON:  Yes.  The problem, Roy, though, is that we don‘t want to execute anyone who didn‘t do it.  So, you got to have the appeals process.  And, by definition, it takes a long time.  I agree with you.  The whole thing is a mockery. 

But there is a deeper question.  And, again, for the fifth night in a row, the question is this:  Do you want the government methodically executing its own citizens?  Do you want it killing its own citizens, except in self-defense?  No, you don‘t.  You don‘t want to give the government that much power at all.  Think about it for a second. 

Let me know what you are thinking.  You can call 1-877-TCARLSON.  That‘s 877-822-7576.  You can also send your hostile comments to our e-mail box.  That‘s Tucker@MSNBC.com

And, if you want to read our blog—and you should—it‘s at Tucker.MSNBC.com, a new one on there every day. 

Still ahead on THE SITUATION, either this owl is very tired, or there‘s been some funny business going on back at the nest.  We will tell you why this little guy has got the munchies when we visit the “Cutting Room Floor.”

(COMMERCIAL BREAK)

CARLSON:  Welcome back. 

Back by popular demand—and when I say demand, I mean with firearms

Willie Geist, the “Cutting Room Floor.” 

WILLIE GEIST, PRODUCER, THE SITUATION WITH TUCKER CARLSON:  Tucker, it turns out Canadians don‘t like being called retarded cousins. 

(LAUGHTER)

CARLSON:  Oh, they don‘t.

GEIST:  You segment with Max has the viewers riled up.  Lots of e-mails from former Canadian viewers of this show. 

CARLSON:  You know, I totally disagree.  I think Canadians, they may be offended that I pointed out that they‘re stalking us.  But at least we‘re paying attention. 

My attacks remind them that, yes, we know you exist.  We can‘t remember the name of your prime minister, but we know you‘re there. 

GEIST:  But, as you say, you‘re only egging them on. 

CARLSON:  Yes.  You‘re right.

GEIST:  And the stalking is going to get worse.

CARLSON:  I—I can‘t help it.  Actually, honestly, I really like Canadians.  They‘re very sweet. 

GEIST:  It sounds like it. 

CARLSON:  They‘re kind of sweet.

(LAUGHTER)

GEIST:  We saw with some amazing video from New York City tonight.  You‘re watching a mother‘s desperate attempt to save her one-month-old son from a fire by throwing him from her third-story apartment. 

Tracinda Foxe was cornered by flames and smoke, as fire swept through her building.  So, she tossed her body down to rescuers below.  Felix Vazquez was the hero who caught the child.  He also then gave the child mouth-to-mouth resuscitation.  The baby and the mother are both doing OK. 

GEIST:  That‘s an amazing story.

And the capper on this, Felix—this is not a joke—Felix plays catcher on the Housing Authority baseball team.  He‘s actually a baseball player.  And they threw it in his hands.  What are the odds of that?  The one time you—you toss your kid out the window...

CARLSON:  That‘s incredible.

GEIST:  ... there‘s a baseball player who knows CPR waiting on the other end. 

(CROSSTALK)

CARLSON:  That‘s incredible. 

GEIST:  It‘s an amazing story. 

CARLSON:  Well, we now make the smooth transition from a daring baby rescue to an elephant who paints. 

(LAUGHTER)

CARLSON:  This is Rama.  He lives at the Oregon Zoo in Portland.  And he scratches his creative itch by filling his trunk full of paint and spewing it all over a canvas. 

An exhibit of Rama‘s work opens tomorrow at the zoo.  His paintings start at $150 and go up to $2,000. 

GEIST:  OK.  Tucker, this, in a nutshell, is my complaint about modern art.  An elephant sneezes on a piece of paper, and it goes for $2,000.  I hate that. 

CARLSON:  You know what?  I remember when William Burroughs, who wrote “Naked Lunch,” would fire a shotgun at a full can of paint.  And he—he got more than $2,000 for them.  I think this is actually a pretty good deal.

GEIST:  Well, this elephant is an up-and-comer.  His price will—his price will rise. 

(LAUGHTER)

CARLSON:  It will go to his head.

You may have noticed, Europeans take their soccer pretty seriously.  So, when this Turkish TV host had the nerve to criticize the local team, the fans decided to do something about it, something like storm the TV studio during a live show. 

The group of rabid fans surrounded the stunned host and began chanting cheers for their beloved team. 

(LAUGHTER)

CARLSON:  The men eventually left the set, and the show went on. 

GEIST:  Tucker, I bet that host would like a word with security over at the station. 

(LAUGHTER)

GEIST:  Look at those guys. 

I will say, though...

GEIST:  That‘s like a hostage video.  That‘s unbelievable.

GEIST:  They did leave eventually.  It took them a while. 

It‘s kind of like when we had the chimp on the set.  You just don‘t know what to do, you know?  Although we are lucky MSNBC has such good security, because we have people outside with torches and pitchforks looking for you every night. 

CARLSON:  Canadians. 

(LAUGHTER)

CARLSON:  If you think “Playboy” and “Penthouse” have hot pinup girls, wait until you feast your eyes on the lovely ladies of the Brady, Nebraska, Red Hat Society.

The women, who average 80 years old, posed in various states of undress for the 2006 calender in order to raise money for the local library.  The exotic spread goes for about $30. 

GEIST:  Tucker, this is an untapped pornography market, greatest generation porn. 

(LAUGHTER)

GEIST:  It‘s a—it‘s niche.  But all porn is, really.  Don‘t you think? 

CARLSON:  I don‘t...

(CROSSTALK)

CARLSON:  This is one of the few things I don‘t think about, Willie, and don‘t plan to, actually. 

GEIST:  Then let‘s move right along. 

(LAUGHTER)

CARLSON:  Let‘s do that.

I know what you are thinking when you look at this owl.  And you are correct.  He is stoned.  A Florida family found the screech owl in their Christmas tree when they started to decorate it.  The bird had been in the tree when it was cut down. 

But here‘s the good part.  When animal control officers came to get the owl, they noticed it smelled like marijuana.  The suspicious officers ran some tests.  And, lo and behold, the owl was indeed baked. 

GEIST:  All right, Tucker, how mad was that owl when animal control showed up? 

We‘re going to take you back into the wild. 

No, no, no, no, it‘s cool.  We‘re doing good here. 

(LAUGHTER)

GEIST:  No, no, no. 

He was there for five days getting baked, and these people come and ruined his party. 

No, I‘m good here.  I‘m good here.  I don‘t want to go back in the wild. 

CARLSON:  In Oregon, even the owls are high. 

GEIST:  That‘s right. 

(LAUGHTER)

CARLSON:  It‘s impressive. 

GEIST:  He was hiding in the tree for five days, and...

(CROSSTALK)

GEIST:  ... noticed him.

CARLSON:  Willie Geist, as always...

GEIST:  All right. 

CARLSON:  ... thank you.

That‘s THE SITUATION for tonight.  Thank you for watching.

Up next, “COUNTDOWN” with Keith. 

Have a great night.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

Watch The Situation with Tucker Carlson each weeknight at 11 p.m. ET

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