updated 1/4/2006 2:44:15 PM ET 2006-01-04T19:44:15

Guest: Craig Crawford, Roberta Baskin, Charlie Cook, Howard Fineman, Jimmy Faircloth

CHRIS MATTHEWS, HOST:  Tea Pot Dome, Watergate, Abscam, Abramoff. 

Today, January 3, 2006, that new name was added to the pantheon of sleaze. 

Jack Abramoff pled guilty to fraud, tax evasion and the big one, bribery. 

Now comes the exciting part.  The wheeler or dealer who paid congressmen to sing the praises of his clients, the biggest briber of them all, will now be singing the names of those he bribed. 

Let‘s play HARDBALL. 

Good evening.  I‘m Chris Matthews.  A live grenade has just rolled into the heart of Washington.  Tonight, after months of negotiation, super lobbyist Jack Abramoff struck a deal with federal prosecutors and pleaded guilty to corruption charges, chief among them, bribing politicians.  It‘s a thunder bolt that reaches up to the highest levels of power and could implicate—get this—up to 20 members of Congress. 

HARDBALL correspondent David Shuster is with us now on the latest— David. 

DAVID SHUSTER, MSNBC CORRESPONDENT:  Chris, today Jack Abramoff pleaded guilty to conspiracy, mail fraud and tax evasion, and tomorrow he‘s scheduled to plead guilty to conspiracy and wire fraud in a separate case in Miami. 

Jack Abramoff was at the heart of a huge corruption probe that has led federal investigators to reportedly question more 50 members of Congress.  And Abramoff is believed to have information that could implicate anywhere between a dozen and 20. 

So who is Jack Abramoff and how did he become so well connected? 

Here‘s a closer look. 

(BEGIN VIDEOTAPE)

SHUSTER (voice-over):  Jack Abramoff is just 47 years old and today, he certainly looked like a character out of one of his favorite movies.  During Abramoff‘s rise to power, associates say the lobbyist often mimicked lines from “The Godfather,” including when Michael Corleone is asked by a crooked politician for a cut of the action.

AL PACINO, ACTOR:  Senator, you could have my answer now, if you‘d like.  My offer is this.  Nothing. 

SHUSTER:  The favorite scene is a reminder that Abramoff saw himself as a brash behind-the-scenes deal maker with influence, money and power. 

During the 1980 presidential election, Abramoff worked with Harvard‘s Grover Norquist, the future anti-tax crusader, and together the college Republicans helped Reagan carry the state.

RONALD REAGAN, FORMER PRESIDENT OF THE UNITED STATES:  Thank you very much.

SHUSTER:  Abramoff and Norquist then came to Washington taking over the National College Republicans where they were joined by Georgia‘s Ralph Reed, future leader of the Christian Coalition and current candidate for Georgia‘s lieutenant governor. 

But in the early 1980‘s, the three infuriated national party leaders with a fundraising flop, prompting then RNC chairman Rich Bond to banish them from GOP headquarters saying, quote, “You can‘t be trusted.” 

Abramoff then began running Citizens for America, a conservative grassroots organization.  He made frequent contact with Oliver North, mastermind behind the Iran-Contra scandal, and helped North lobby Congress on behalf of the rebels in Nicaragua. 

But this was only the beginning of Abramoff‘s career representing some of the world‘s most reviled groups and foreign political leaders.  Abramoff lobbied for Jonas Savimbi, a murderous Angolan dictator.  And Abramoff defended South Africa‘s Apartheid government, which paid him a million and a half dollars. 

All the while, Abramoff dabbled as a Hollywood producer, making two forgettable action films, “Red Scorpion” and its sequel. 

But in 1994, Abramoff turned his focus back to Washington when Republicans led by Newt Gingrich swept into power in the House of Representatives.  Abramoff met and began working with Representative Tom DeLay, and in the late ‘90s, after having figuring out how to use lobbying money to take lawmakers and their staff on lavish trips, Abramoff began bringing DeLay to the exclusive St. Andrew‘s Golf Club in Scotland. 

In 2000, Abramoff worked on the transition team of George W. Bush.  And after the president‘s inauguration, Abramoff befriended top officials in the Department of the Interior, which oversaw policies on Indian tribes. 

Abramoff then convinced several tribes he had the power to keep the administration and Congress from taxing their casino moneys.  The tribes then paid Abramoff‘s firm, over the course of three years, more than $80 million. 

But according to today‘s court documents, Abramoff was running a fraudulent and criminal scheme.  He is charged with pocketing tens of millions of dollars and using other fees to bribe members of Congress and their staff. 

The activities and gifts included luxury sky boxes at Washington sporting events, lavish travel and more golfing trips to St. Andrew‘s.  Abramoff also put money into a variety of personal projects, including a sham think tank set up by his partner Michael Scanlon, a former staffer to Tom DeLay.  The group was in Rehoboth Beach, Delaware, and was staffed by friends Scanlon made from a summer as a lifeguard. 

In the midst of all of this, Abramoff privately showed contempt for the Indian tribes he and Scanlon were bilking, describing the Indian tribes in e-mails as morons and troglodytes. 

(END VIDEOTAPE)

SHUSTER:  Abramoff‘s deal today should reduce his prison sentence between nine and a half and 11 years.  And it comes in the wake of plea deals reached by his business partner Michael Scanlon and by others. 

And it all means that, instead of resembling “The Godfather‘s” suave Michael Corleone, Jack Abramoff now resembles Frankie Five Angels.  That was a guy who agreed to testify as a government witness—Chris.

MATTHEWS:  Well, the question, of course, David, right now is who is he going to testify against?

SHUSTER:  Well, Christ, there‘s every indication that Tom DeLay.  There‘s information related to Tom DeLay in this indictment.  There‘s information related to Bob Ney.  There are others that have been under investigation, widely reported.  It‘s not clear whether this is going to lead to them.

But clearly, if you believe all the accounts of people who have been covering this for the last couple of years, and if you believe the buzz in the Washington legal community, there are at least 15 to 20 members of Congress who are clearly in the gun sights of this federal Justice Department task force, which has been looking at Jack Abramoff and they‘ve got the top guy. 

Now that they have the guy who is doling out the money, now it‘s a question of going to these lawmakers and figuring out, OK, which lawmakers are going to plead guilty to taking bribes?  Which lawmakers are going to fight this and possibly be indicted?

MATTHEWS:  I guess once you get the head, you get the tentacles of this octopus.  Big crime here.  Thank you very much, David Shuster.  Great report.

SHUSTER:  Thanks, Chris.

MATTHEWS:  Let‘s bring in NBC News justice correspondent Pete Williams, along with NBC News Capitol Hill producer Mike Viqueira and Craig Crawford of “Congressional Quarterly.” 

Pete Williams, let me ask you about this octopus.  How much of a threat is it to the Republican leadership of Congress and to the White House and how far can it reach?

PETE WILLIAMS, NBC NEWS CORRESPONDENT: I don‘t know much about the White House.  Certainly the Republican leadership, some Democrats in Congress and unusually, I think here, Chris—I know you‘ve talked about this earlier today—congressional staffers. 

One of the things that the indictment says here is that Jack Abramoff would get people who were working for members of Congress, bring them into his lobbying firm and then send them right back up to the Hill, to Capitol Hill. to lobby their former bosses, which they‘re prohibited by law from doing for a year after they leave government.  And it says that he did that on purpose, knowing that that was against the law.  So some former staffers have a problem here, as well.  So it‘s not just limited to members. 

There was—you mentioned that he worked on the transition team at the Interior Department.  And there‘s a suggestion, possibly, of at least one, possibly two people there. 

So—but so there are some people in the executive department, but the focus is certainly on Capitol Hill. 

MATTHEWS:  He‘s pleading—he‘s pleading guilty here to a whole number of counts which could add up to, you know, decades of imprisonment.  How do we explain somebody pleading and accepting so much—so much punishment?

WILLIAMS:  Because they hope to escape more than half of it. 

You‘re right.  If you add up the prison terms that he could conceivably get, it‘s a 30-year maximum.  Now under the sentencing guidelines, he would never get that much. 

But what he‘s agreed with the government is that they like his testimony, it could be shorter. David mentioned, that of the sentencing guidelines, nine and a half to 11 years.  It could be considerably shorter than that...

MATTHEWS:  Right.

WILLIAMS:  ... if he cooperates and names names the way that they hope he will. 

And by the way, David also mentioned that little problem he has down in Miami, where he faces a federal indictment for defrauding the banks who loaned him money to buy some casino boats.  What the judges are saying today is that, if this all works out, he could serve the two sentences concurrently. 

MATTHEWS:  He‘s sort of—the judge here seems to be putting up a guillotine over his head and saying, “I‘ll pass judgment on this case, I‘ll pass on sentencing after you‘ve cooperated.” 

WILLIAMS:  Exactly.  And that‘s the usual deal.  That is the big sword that the government has. 

We have to understand here that the government didn‘t agree to its side of this plea deal until it had sat down with Jack Abramoff and gotten what they call a proffer: what would you be willing to say?  What could you give us?  The government has a very good idea of what he‘s willing to say or they would never have agreed to this.  They—his own lawyer said they‘ve been meeting together on this for months. 

MATTHEWS:  You know the justice system.  You know what prosecution deals are like, what plea bargains are all about.  How big an enchilada does he have to deliver to get a reduced sentence, down to, say, three or four years?

WILLIAMS:  Very big.  But I think the expectation is that he will. 

And I think his own statements in court today, Chris, suggest that he will. 

He said today that—he says, “I only hope I can merit the forgiveness from the Almighty and from those I have wronged or caused to suffer.”  And that he wants to—to atone for his past mistakes and seek forgiveness.  He really wants to try very hard, apparently, to do what he has to do to please the government. 

MATTHEWS:  He certainly wasn‘t wearing sackcloth and ashes today, however.  I don‘t know about you, Pete.  You work in Washington.  It‘s not a flashy town in terms of dress code.  But catch this.  We‘re watching this on the screen here. 

Look at this Chesterfield collar, this expensive hat he‘s got on.  I have never seen, I should say, an ashamed defendant behave so grandly.  He does look like a Godfather figure in that picture. 

WILLIAMS:  Well, perhaps if he‘d been my client, I would have advised him not to wear a black hat. 

MATTHEWS:  OK.  Thank you very much, Pete.  Stick with us, Pete.  I want to have Mike Viqueira join us, Capitol Hill.  I was struck by the fact that Denny Hastert, speaker of the house, is clean as a whistle so far on everything else involved, quickly gave back $69,000 in campaign contributions from guess who, today, Abramoff.

MIKE VIQUEIRA, NBC NEWS         CORRESPONDENT:  Well, it wasn‘t that quickly, Chris.  Because remember, this thing has been brewing for quite some time.  There were several members of Congress who were the recipients of donations from Abramoff and people associated with Abramoff that have been giving money back in spades over the last several weeks, even months. 

Conrad Burns, a Republican from Montana, who‘s been mentioned very often in connection with Abramoff and the Indian tribe aspect of this scandal, held out for several weeks and is finally giving back the money that Abramoff had given him. 

Hastert, you‘re right, this evening has decided that he will give back the $69,000 to charity. 

MATTHEWS:  To charity.  What does that mean? 

VIQUEIRA:  He hasn‘t named the charities yet.

MATTHEWS:  Why doesn‘t he give it back to Abramoff?

VIQUEIRA:  That‘s a good question.  Typically when these sorts of...

MATTHEWS:  He admits he got it from him. 

VIQUEIRA:  This is sort of an indication of how big this is being viewed on Capitol Hill.  Because typically, when someone is implicated, someone who‘s given money, a member will say, “Well, I‘m not going to give back this money, because that‘s an admission by me that I took the money for a nefarious or dishonest purposes.” 

MATTHEWS:  So what does giving it to a third party tell anybody? 

What‘s the message there?

VIQUEIRA:  I don‘t know.  I think that a lot of these people are feeling the heat.  Republicans are nervous. 

Remember, this comes on the heels of Duke Cunningham.  Straight up admitted to bribery.  Delay admonishments from a year and a half ago and on down the line.  I think the Republicans heading into this election year are very nervous about what‘s going on here. 

And by the way, the irony has not been lost on many of them.  John McCain, who started all this with his hearings, and the Republican Justice Department may be the instruments of their destruction next fall. 

MATTHEWS:  Right.  Well, that wouldn‘t be the first time that John McCain caused trouble for his own party. 

Craig Crawford, let me ask you.  I can just imagine the old days of the editorial cartoonist.  Now they‘re still out there in the newspapers.  You can just imagine the pictures tomorrow morning in the paper, these cartoons.  There will be rats leaving the ship with names like Hastert on it. 

CRAIG CRAWFORD, “CONGRESSIONAL QUARTERLY”:  You could go all the way back to the Gilded Age when cartoons began and look at this.  I mean, this is the biggest Washington corruption scandal in a generation probably, and if it unfolds as it seems it‘s going to. 

And I don‘t think it‘s going to be isolated to this man.  You know, it‘s fun to look at his hat and trying to say it‘s about him, but there‘s a wide group of people. 

MATTHEWS:  Well, he‘s sort an important echo of Washington in the sense that he‘s going out there saying greed is good.  You read the e-mails, you read the conversations—we picked up bits of it—telling these young guys who are off to Capitol Hill, we can take more from these morons, referring to the Indian clients they‘re getting millions from, troglodytes, making fun of the people they‘re bilking, laughing about their ability to play Capitol Hill like a juke box. 

CRAWFORD:  Yes.  And there will be an effort to isolate this and say this is just one guy and a handful of politicians.  But I think it‘s an indictment of the city as a whole. 

MATTHEWS:  Tell me what you mean.

CRAWFORD:  I think this town has become so run by money.  Money is the dominant political party in Washington.  Sometimes I think the Democrats or Republicans...

MATTHEWS:  OK, let me ask you. 

CRAWFORD:  I know you don‘t like that theory. 

MATTHEWS:  No, because I have friends in Congress who are my sources as well as my friends and they won‘t take dinner from me. 

CRAWFORD:  Yes.  I understand that there are honest people on Capitol Hill.  And there are two standards of proof here, one in the court of law and one in the public arena.  And I think the public arena standard proves a little bit thinner, what‘s required.

And when you look at the money, Chris, I mean, a million dollars it takes—the average House incumbent spent $1 million to keep a seat.  The average—the average senator incumbent spent $7 million to keep a seat.  That kind of money flowing into the coffers of campaigns, it leads to corruption. 

MATTHEWS:  OK.  Let me—I think we‘ve reformed ourselves to death. 

Mike, let me ask you this.

I‘ve noticed that in all the charges that have been sort of aired today, Abramoff giving money to congressmen in terms of trips—I don‘t know why these guys are all such golf nuts but they‘ve got to go to St.  Andrews or whatever else, no cash.  The old days before Watergate, they‘d fill the envelopes, they‘d fill—remember the famous Herman Helmut of Georgia said, “They just put it in my raincoat.”  You know?  The old days when cash would flow. 

For some reason, the new laws prevent actual, “I‘m going to buy you, Congressman.  Here‘s your $10,000 to spend as you will.”

So instead they say, “You can come with me in some stupid junket to St. Andrews for two or three days.”  Is that what we‘ve done with all this reform, forced the money into a new form?

VIQUEIRA:  Perhaps.  Post-Watergate, of course, there was Abscam, where they had members of Congress getting bribed by FBI agents.  Cash.  Cash.

Now that is the question here, whether or not these favors that were received by Congressman Bob Ney and others in terms of the golf trips, in terms of having Ney place statements in the congressional record in support of Abramoff‘s clients, was—can they prove—can the Justice Department prove, do they have evidence, will Abramoff be able to provide them with that evidence that shows that there was a quid pro quo? 

People give money to Congressmen every day of the week in the United States of America in this Congress.  Members who have specific purview over specific pieces of legislation get money from industries that are specifically affected about by that. 

(CROSSTALK)

MATTHEWS:  OK.  You‘re saying—regular people.  You say I gave this guy his money and he put this in the record for me, they‘re going to believe it. 

We‘ll be right back with Pete Williams, Mike Viqueira, Craig Crawford.  And when we return, we‘ll sort out the players in the Abramoff case and talk about the role of Congressman Tom DeLay.  We‘ll talk about that one when we come back.

You‘re watching HARDBALL on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Coming up, lobbyist Jack Abramoff cuts a deal with the prosecution.  How damaging will this be to certain members of Congress?  And what about Tom DeLay?  HARDBALL returns after this.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to Washington. 

We‘re talking about today‘s news that lobbyist Jack Abramoff has reached a guilty plea agreement with prosecutors to federal charges of conspiracy, tax evasion and fraud and, by the way, bribery. 

Back with me NBC‘s chief correspondent of justice, Pete Williams, NBC News Capitol Hill producer, Mike Viqueira.  Also with us, Craig Crawford of “Congressional Quarterly.” 

Let me go back to Pete Williams, because you‘re the expert on the judicial process in this country, which seems to be so much related, unfortunately, these days, to the political process. 

This squeezing process, it reminds me of the thing that might be going on right now with regard to the CIA leak case, whereby the federal prosecutors get someone like Michael Scanlon, an underling of Jack Abramoff, squeeze him and then what do you know, within a couple of weeks, the big guy is squeezed. 

WILLIAMS:  Yes.  And indeed, also had gotten the guilty plea from Jack Abramoff‘s business partner in Florida on the casino boats.  So they‘ve been circling all around him, moving in on him.

But remember, he is just the lynchpin here.  He is—he is what they now hope will lead them down the corridors into Congress. 

And I think, Chris, you know, we‘ve been talking about his—his potential bribery of members of Congress.  One other thing to remember here that I think is quite illuminating out of this charge today, about what kind of a person Jack Abramoff was, it said that he bilked—he billed four Indian tribes, saying he could help them get casinos in Washington, something like $53 million, then urged them to hire a firm by a friend of his, Michael Scanlon, without telling them that Jack Abramoff was going to get half the profits of whatever they paid to Scanlon. 

And what‘s more, these charges say, he agreed to help a Texas Indian tribe get gambling casinos in Texas.  All the while he was representing a Louisiana tribe to block any casinos from being issued in Texas.  So that tells you a little about Jack Abramoff.

MATTHEWS:  He was laughing at the system, wasn‘t he?

WILLIAMS:  Exactly. 

MATTHEWS:  And I also thought it was fascinating that he found a way around the regulation of the reporting requirements by having his client, the Indian tribe, give money to what was purportedly a public relations campaign...

WILLIAMS:  Right.

MATTHEWS:  ... not a lobbying campaign.  So as long as their money was earmarked for Michael Scanlon for a P.R. campaign, it wouldn‘t have to be reported. 

WILLIAMS:  Right.  Exactly.  So he‘s got a lot of problems here, which he has solved here by pleading guilty.  In terms of his shortening his potential exposure to jail time, which of course, is a huge come-down for him.  He was a high-flying guy who had the city in the palm of his hand.  Now he‘ll be helping the government possibly bring others down. 

MATTHEWS:  What did you make of his—of his contrite words today?

WILLIAMS:  Well, I thought they were very interesting.  Obviously, it‘s something he had worked out, wrote out himself, probably ran it past his lawyer, Abbe Lowell, who was there with him in court today. 

We forget the fact that Jack Abramoff is a—from all accounts, a religious person, an observant Jew, who in some of his early meetings with members of Congress, they found him to be somewhat—the Southern members of Congress found him to be sort of a puzzling figure, because he had a beard and he would wear a yarmulkes. 

MATTHEWS:  Yes.

WILLIAMS:  So as a reminder of his faith, that he said, you know, he hopes that he can merit forgiveness from the Almighty.  We don‘t hear that often in federal court. 

MATTHEWS:  Well, he wasn‘t that observant of the Ten Commandments, apparently. 

WILLIAMS:  Fair point.

MATTHEWS:  OK.  Thank you, Pete.

Let me get back to this implications right now to Congress.  The first shoe to drop was Denny Hastert tonight, saying he‘s giving back $69,000.  Tom DeLay, his exposure here?

VIQUEIRA:  Tom DeLay, first of all, his future as a majority leader is now thrown very much into doubt.  He‘s not going to run a five, 10 percent chance of becoming majority leader.

MATTHEWS:  Of ever coming back?

VIQUEIRA:  In my estimation.  First of all, there‘s the Texas case, which is not going as quickly as Mr. Delay certainly would have hoped.  And now this article in the “Post” over the weekend about his connections to Abramoff that were deeper than originally had been represented. 

It was interesting.  Today we heard Dick DeGuerin, an attorney for Tom DeLay, say that Tom DeLay was a friend of his.  Tom DeLay is still a friend of Jack Abramoff‘s but he‘s very disappointed in what Abramoff has done.  He didn‘t really step that far back from Abramoff, which I thought was kind of interesting on DeGuerin‘s part. 

People who know Tom DeLay, people who have worked for him, fellow members of Congress, say that Tom DeLay is not so stupid as to take a bribe and get caught doing it.  Or he‘s more ethical than to take a bribe.  He walks right up to the line. 

MATTHEWS:  You‘re laughing because you‘ve heard this before. 

VIQUEIRA:  He walks right up to the line and people say he flies close to the edge. 

MATTHEWS:  Chris laughing throughout the whole story.  Thank you, Mike Viqueira; thank you, Pete Williams, again; and thank you, Craig Crawford. 

Up next, more than 200 lawmakers received money from Jack Abramoff, were his clients since ‘99.  What will Abramoff‘s guilty plea mean for them?  Well, they‘re giving some of it back. 

You‘re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.

As an investigative journalist, Roberta Baskin broke some big stories:

the Nike sweatshop scandal, the NFL drug testing scam.  But she says they‘re all dwarfed by the scandal that‘s unfolding in Washington with lobbyist Jack Abramoff at its center. 

Now she‘s executive director of the Center for Public Integrity, a nonprofit, nonpartisan group for investigative journalism here in the public interest. 

Roberta, put this in perspective.  Jack Abramoff, he‘s facing years in prison.  He‘s going to name names.  He took millions of dollars from the Indian tribes, bought members of Congress through trips and everything else.  Put it in perspective.  Is this Washington?

ROBERTA BASKIN, EXECUTIVE DIRECTOR, CENTER FOR PUBLIC INTEGRITY: 

Well, this is like the fourth branch of government.  It‘s a part of government...

MATTHEWS:  Lobbying.

BASKIN:  Yes.  Lobbying doesn‘t get that much scrutiny.  People don‘t think about it.  If you looked at campaign finance stories, you‘d find that there‘s 10 times more than there are about lobbying but twice as much money is spent on lobbying.  So it‘s a big business in Washington that has kind of been under the radar screen for taxpayers, for the public. 

MATTHEWS:  Abramoff apparently wasn‘t shameless—or wasn‘t ashamed to go around to staffers on Capitol Hill and say, “I want you to work for me some day.  I‘ll give you the nice suit, the tan, everything else that comes with it, the golf trips and everything.”

How is that different than any other lobbyist?

BASKIN:  Well, there are some 2,200 former federal employees that are lobbyists.  There‘s 250 former congressmen or heads of agencies that are lobbyists that have registered as lobbyists. 

And so it‘s—it‘s face time, if you can hire a former senator or a former congressman to work for you.  There actually are some companies that have more congressmen working for them than some states have. 

MATTHEWS:  Really?

BASKIN:  Really. 

MATTHEWS:  And do these guys get paid a lot?

BASKIN:  They get paid a lot when they become lobbyists.  It‘s kind of like having your pension plan.  You know, you work for not that much money when you‘re a congressman or senator, but you have the possibility, and many take advantage of it, of making a lot of money as a lobbyist. 

MATTHEWS:  Let‘s tell people out there—I‘ve learned this.  Every once in awhile I‘ve got to relearn it.  I know that congressmen can‘t take, if you offer them to go to dinner with you, use them as a source, they can‘t take more than, what, $50 a year?

BASKIN:  Forty-nine dollars and 99 cents, yes. 

MATTHEWS:  A year.

BASKIN:  Yes.

MATTHEWS:  So if you take somebody to an expensive restaurant in Washington...

BASKIN:  It‘s a couple of—I think it‘s within a two-month period. 

MATTHEWS:  A two-month period.  So there‘s limits on that.  What other limits are there that are effective on buying members‘ influence?

BASKIN:  Well—well, you know, the revolving door is really a spinning door at this point.  There‘s a rule that you cannot work as a lobbyist for a year after you‘ve been a congressman or senator...

MATTHEWS:  Or a staffer. 

BASKIN:  Right.

MATTHEWS:  But this law has been broken in the case of Abramoff.  He was working with—he‘d hired and used former staffers within the year of their service. 

BASKIN:  Right. 

MATTHEWS:  What do you make of this buying a congressman, Congressman

A, or whatever he‘s called—I think we know who it is, somebody from Ohio

to put things in the congressional record under their name so that it helps him in a business deal down in Florida?

BASKIN:  It‘s unethical.  And, you know, representatives of Congress are supposed to be representing the people, not big business. 

And what‘s happened is that, because lobbying is really happening underneath the radar screen of the public, they‘re getting away with a lot. 

I mean we found that 49 of the top 50 lobbying firms don‘t even file their forms necessarily on time.  There is 14,000 records that are missing.  What happened is when Congress passed the Lobbying Disclosure Act back in 1995, there was this big debate about whether or not the enforcement was going to be put under the Federal Elections Commission or under Congress. 

Congress decided, let‘s not put it under the FEC, which has nearly 400 employees, really regulating it.  They kept it under Congress.  In the Senate you have 11 people -- 11 people responsible for all of these of hundreds of thousands of records.  It‘s a system run amuck.  It doesn‘t work.

MATTHEWS:  Let‘s talk about the rats leaving the ship here.  Abramoff pleads guilty today, he may go to prison for five or 10 years, he‘s going to name names.  Now look at this.  This afternoon following his plea bargain, Representative Bob Ney of Ohio, I think we mentioned him a minute ago.  Bob Ney said this, “At the time I dealt with Jack Abramoff, I obviously did not know, and had no way of knowing the self-serving and fraudulent nature of Abramoff‘s activities.”

What do you make of that statement?

BASKIN:  It sounds very innocent and naive.

MATTHEWS:  Is it an honest statement?  He was tricked into a corrupt deal with—is he saying he was tricked into a corrupt deal with a corrupt guy?  He didn‘t know it.

BASKIN:  Well, that‘s for a court to decide.

MATTHEWS:  All right, let me ask you this.  And you covered this thing in your organization, the way money is spent in this town.  Lawmakers returning donations from Abramoff to his clients: Conrad Burns of Montana, a republican senator gave back some money after Abramoff got into trouble, money from Abramoff.

Max Baucus of Montana, same deal, gave back Abramoff money.  Byron Dorgan of South Dakota, Democrat, gave back Abramoff money.  And Denny Rayberg from Montana.

And now tonight, out of nowhere, the press secretary for the speaker of the House, Dennis Hastert‘s press secretary told NBC News, “Oh by the way, the speaker will now return $69,000 in money from Abramoff and his clients to charity.”  He is calling it a return because he wants to get the money off his hands.  What do you make about all these conversions on the road to Damascus after Abramoff has pled?  Why didn‘t they give the money back a week ago, or 10 years ago?

BASKIN:  Because of all the scrutiny that it‘s getting now.  It‘s about transparency that is being created about how it works in Washington.  And so there is a scramble now because of the appearance of a conflict of interest or a problem.  You know, this is not what—you know, these guys don‘t want to be named on the front pages of “The New York Times or “The Washington Post,” and so they‘re trying to be preemptive, but it‘s a little bit late.

MATTHEWS:  Would they have given this money back if he hadn‘t gotten caught and forced a plea?

BASKIN:  I can‘t speak for them, but I don‘t think so.  I mean, this has been—you know, lobbying has been going on since the first Congress.  The first Congress, there were New York merchants who were handing out candy.

MATTHEWS:  OK, lobbying is legal.  It‘s called the right to petition Congress.  You can‘t keep including this guy Abramoff with the right to go complain to your congressman about something that‘s not done, right?

BASKIN:  That‘s correct, it‘s perfectly legal, there‘s nothing wrong with it.  But it deserves to be transparent and that‘s what the lobbying disclosure rules that were passed were designed to do.  And they don‘t work when you have 11 people looking at it.  Oh, this was in the public record, if you go and you look at the documents. 

But Congress doesn‘t allow itself to be under the Freedom of Information Act.  So you would have to go down to the Senate Office of Public Records to do that until the Center for Public Integrity put together this lobby watch database so you can look up your legislator, you can look up a state, you can look up a foreign government and issue the amount of money the lobbyist—it‘s a very interesting way to follow the money. 

MATTHEWS:  OK, thank you very much for helping us do it.  Roberta Baskin.  Up next, we‘ll look at Jack Abramoff‘s rise to power, what a sordid tale that is.  And his ultimate fall, which is yet to come.  He started to fall today when he pled guilty to all those charges of—well, let‘s call a lot of them bribery.  And what it means here in Washington.  You‘re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

(NEWS BREAK)

MATTHEWS:  Welcome back to HARDBALL.  And how did Jack Abramoff become so powerful?  Joining me right now, experts Howard Fineman of “Newsweek” and the “National Journal‘s” Charlie Cook, who writes the “Cook Political Report.” 

Howard, we got a little hot note in here tonight that Denny Hastert, the speaker of the House, has now said he‘s going to give back $69,000 he got from Jack Abramoff.  He‘s going to give it to charity, he‘s going to try to clean up his relationship.  We are hearing a lot of this now.  All these guys on the road to Damascus are being converted now as people who don‘t like their relationship with Jack Abramoff.

HOWARD FINEMAN, “NEWSWEEK”:  Yes, well they were defending this—everybody was defending this as business as usual until today.  And I think, having talked to an attorney like Bob Bennett, who knows a lot about criminal defense work here.  He said there‘s more than a handful of members of Congress who are not sleeping well these days because they want to disassociate themselves, as Hastert is now trying to do, from Jack Abramoff, who by my calculations in this indictment, had at least $20 million to spread around.  That‘s a lot of money.

MATTHEWS:  Money he could use—he got from clients.

FINEMAN:  Campaign donations, you could direct from—this isn‘t even stuff he could direct from clients.  This is just his own money that he was siphoning off, according to what he pleaded guilty to here today.  That‘s powerful big bucks around here.

MATTHEWS:  OK, I‘m going to be a skeptic here about this being partisan until we learn a little more about how many guy‘s fish is going to be fried here.  But let‘s go with this first one.  He seems to be tied into the religious right.  He has got Ralph Reed working with him.  He has obviously been giving money to Hastert.  He‘s given money to DeLay.  Is this a Republican problem here, or is this a congressional problem? 

CHARLIE COOK, THE COOK POLITICAL REPORT:  Well, I think he is—Jack Abramoff is a Republican, and obviously, you work your side of the fence.  And while there is a little dabbling on the other side, you work your side. 

But first of all, who wants to buy the minority?  You want to buy the majority, the people who are in power.  We Democrats don‘t have any power, why the hell would you want to go after them?  But this is also was working his side of the fence. 

But when you‘re in power for a long time, this kinds of stuff happens, and it happened with Democrats in previous cycles, it‘s happened with Republicans now.  But I‘ve been in Washington 33 years, Chris.  Both of you guys have been here a long time. 

MATTHEWS:  Longer than you, bro.

COOK:  I‘ll tell you what, I never—I‘ve known a lot of lobbyists, I‘ve never heard of a lobbyist one one hundredth this sleazy. 

MATTHEWS:  Are you saying that power tends to corrupt and absolute power corrupts absolutely? 

COOK:  No question.  That‘s it.  That‘s it.  That‘s it.

MATTHEWS:  Howard, is that the message here? 

FINEMAN:  You know, I‘ve been covering this drift of history for years now.  I first interviewed Jack Abramoff 20 years ago when he was the head of The College Republicans.  He was a fresh faced kid in town, full of ideological fervor, wanted to enlist in new right causes.  Saluting at Ronald Reagan at every turn.  Helping...

MATTHEWS:  Look at him now, what do you make of this...

FINEMAN:  He‘s gone from the fresh-faced kid to the suntanned lobbyist to the mobster-looking guy, who looks like he‘s ready to take down a lot of people.  If I were any of those members of Congress, who were having sleepless nights, I would sleep even less having seen that picture of Jack Abramoff. 

He looks like if he would open that raincoat, he has got a half a dozen machine guns inside.   

MATTHEWS:  He looks like the guy in “Godfather II” going after Hyman Roth. 

(CROSSTALK)

MATTHEWS:  Let me ask you about...

FINEMAN:  The message of that is he‘s going to take no prisoners. 

That‘s the message I take from that picture.

MATTHEWS:  That he‘s going to squeal. 

FINEMAN:  He‘s going to squeal big time. 

MATTHEWS:  So when you deal with a guy who is a sleaze, he has no principles, no loyalties, you must expect the fact he‘s going to turn on you at some point if he gets caught.  So Michael Scanlon, his associate, apparently turned on him. 

Is he now going to turn on everybody?  If you‘re a prosecutor right now, you say to him, who have you ever given money to, who have you ever taken on a trip?  Let‘s go through the list of congressman.  We‘ll go down the list.  Who have you ever done anything for? 

COOK:  The thing is they‘ve got him on three counts.  Total maximum 30 years, plus all the counts that they didn‘t indict him on or weren‘t going after him on.  To get it down to nine to 11 years, they‘ve got to expect for him to do some real serious singing. 

Clearly, he has given them plenty of reason to believe that he‘s going to do some singing, otherwise they would never have done this deal.  They would never have knocked it down from 30 years. 

MATTHEWS:  And he can seriously pass—you mean he might be out of prison with good time in five years, if he sings loud enough, right?  Is that what you‘re saying?

FINEMAN:  Yes, possibly, that‘s what they‘re holding out to him.  Now, the prosecutors did something interesting here.  They only gave—they only talked about, indirectly, one member of Congress.  But everybody assumes that there are a lot more possibilities out there, because this is the first Blackberry, poisoned Blackberry prosecution, OK? 

Everything is on the Blackberry.  Everything is on e-mail.  This guy and his associates e-mailed everybody around town constantly.  It was one consciousness, a matrix.  See, the guy looks like a figure out of “The Matrix.”  This is one matrix of influence, OK?  In the—and all of that never disappears.  E-mails, once they‘re created...

MATTHEWS:  Is this bigger than ABSCAM? 

FINEMAN:  Potentially, yes.  What they don‘t have here that they had in ABSCAM was videotapes of guys actually taking bags of cash. 

MATTHEWS:  The phony (INAUDIBLE) guy, yes.

FINEMAN:  They don‘t have that here, but what they‘re alleging here is an actual bribe, where they‘re saying there‘s a specific quid pro quo.  That‘s tough stuff.  It‘s tough to prove. 

What Bob Bennett was explaining to me, it‘s hard to prove this, but the prosecutors are going for the very toughest thing to prove with a member of Congress.  That means they think, I think, that they can do it with others. 

COOK:  It comes down to two things.  Number one, does Abramoff implicate Tom DeLay or not, and that‘s key, because does it—if it‘s without DeLay, this is a congressional scandal.  With DeLay, it becomes a Republican scandal.

And the second thing is, what kind of numbers are we talking about?  Are we talking about two, three, four, five members, or are we talking about six, eight, nine, 10?  And that‘s where it starts taking on (INAUDIBLE). 

MATTHEWS:  Well, it‘s binary.  Are you finished or not?  You are saying DeLay might be finished after this?  Denny Hastert is still trying to clean up his act giving back the money.  I‘m suspicious of guys who give back the money after the bagman gets caught. 

We‘ll be right back with Howard Fineman and Charlie Cook in a moment.  And a reminder, for the best political debate online, just go to hardblogger, our political blog Web site.  And now you can download podcasts of HARDBALL.  Just go to our Web site, hardball.msnbc.com. 

(COMMERCIAL BREAK)

MATTHEWS:  We‘re back with “Newsweek‘s” Howard Fineman and political analyst Charlie Cook.  The things you say when the camera is not running. 

Let me ask you about this Abramoff thing again.  In terms of the way Congress runs, people say, what else is new?  And I just want to put this - ask both of you, as Washington people, Capitol Hill has 435 members of the House, 100 members of the Senate, thousands of staff people who get salaries.  They vary from low to higher than they deserve.

Corruption.  What‘s the percentage on the Hill of corruption?  Taking money for stuff they shouldn‘t be doing?

COOK:  Tiny.  I think it‘s just absolutely tiny—it‘s there.  I mean, Congress reflects society, and in society people are corrupt.  But it is infinitesimal and no more than any other line of work, and probably less than most.

MATTHEWS:  So you‘re taking a dinner, you might not write down for once in awhile from somebody.

COOK:  But who—what corporate executive doesn‘t take a lunch from someone trying to sell his company something?  I mean, there‘s that kind of thing taking place everywhere.

FINEMAN:  Here‘s the...

MATTHEWS:  Here‘s the sense of how corrupt the Hill is.

FINEMAN:  Well, I think it‘s like the summer weather in Washington, where the thunder clouds and the humidity build up, and it takes a week, and then there‘s a tremendous thunderstorm, then it clears out again.  These things tend to build up here over the years and we‘ve got another thunder cloud. 

MATTHEWS:  So Abramoff was the guy who kept testing the limits.

FINEMAN:  He kept testing the limits.  First of all, it is true that the money culture on the Hill keeps getting more pervasive.  They have to spend more and more time to raise money, to buy the TV ads.

MATTHEWS:  And the money from the lobbyists gets bigger and bigger because even though the number of Congress people stays the same, the amount of federal interest now from big corporations because of taxes and trade and regulation, there‘s more interest and more money in buying Congress.

FINEMAN:  Therefore every member is dealing in millions and millions of dollars all the time, so I think that to some extent can periodically dulls their senses and then you have a crowd that totally controls Washington.  The Democrats totally control Washington for a time, now the Republicans totally control it and the temptation is not to do the legal quid pro quos of campaign contributions because that‘s the legal part of it.  It‘s to take it the extra step and short circuit even that to take it directly to the kind of bribe that is spelled out in this indictment.

MATTHEWS:  And all these reforms that McCain passed, everybody has been passing reforms for 30 years in this town to clean up and limit the amount of influence of lobbyists.  Why hasn‘t it stopped these guys?

FINEMAN:  Well, periodically it does for a while.  It does for a while.  The air gets cleared for a while and then people find new routes and the amount of money keeps getting more through the roof and it happens all over again.  It‘s clearly happened again. 

Don‘t forget, this is the Republican Justice Department, this is the Republican integrity section of the Bush Justice Department, the lifers with some political people.  Let‘s give them credit too under Mike Chertoff and others.  He put those people in.  They‘re pursuing this.  They‘re pursuing it.

MATTHEWS:  That‘s good to hear.  Thank you, Howard.  Well-developed there.  Thank you Howard Fineman of “Newsweek,” thank you Charlie Cook of the “Cook Report.”  One of the next legal steps in the Abramoff case, we‘ll have an exclusive interview with the attorney for one of those Indian tribes that gave money to Abramoff and got nothing in return.  This is HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back.  What does Jack Abramoff‘s guilty plea today mean for the tribes who were swindled out of millions of dollars by him?  Well, Jimmy Faircloth represents the Coushatta tribe in Louisiana.  His clients paid Abramoff and Michael Scanlon, his partner, approximately $31 million in lobbying fees. 

Mr. Faircloth, thank you.  What does your tribe think of the fact that it bilked out of these millions of dollars by a guy who gave them nothing?

JIMMY FAIRCLOTH, LOUISIANA COUSHATTA TRIBE ATTORNEY:  Well, they are outraged.  Whether he gave them nothing, I‘m not certain of that.  I think that was probably overstated.

MATTHEWS:  Well, that‘s what the indictment says.  The indictment says that Mr. Abramoff never delivered services for all that money he got.

FAIRCLOTH:  But there are two aspects to what was delivered.  In one respect, Abramoff‘s firm was hired.  And then the Scanlon connection was through capital campaign strategy.  Which in—and that‘s the focus of the indictment.  The indictment doesn‘t mention the $125,000 a month that was paid to Greenberg Traurig for the lobbying services.  So it‘s actually two components to what was purchased.

MATTHEWS:  Well, what does your tribe think about the indictment today, the fact that he pled today to something like nine or 10 years in prison, perhaps a lot more?

FAIRCLOTH:  Well, they‘re very satisfied with the fact that he will go to the prison, but the indictment does not cover the full aspect of the fraud with regard to the money.  There is still a great deal of money that was not accounted for in the indictment, or in Scanlon‘s indictment, for that matter.  Because both indictments focus on...

MATTHEWS:  $25 million, are they going to get $25 million back from this guy?  What are they going to get back, your tribe, if this works out your way?

FAIRCLOTH:  Well, it‘s our position that all of the funds that were paid to Capital Campaign Strategy, that is Michael Scanlon‘s organization, were fruits of a fraud.  And so, it‘s our position that all of those funds, which is approximately $31 million, should be returned to the tribe.

MATTHEWS:  And how is that going to happen?  He is exposed now to litigation by your tribe.  Is he required by this plea bargain to pay any amounts of money?

FAIRCLOTH:  No, not the plea bargain.  There will be a restitution order, I assume, when the sentencing hearing is conducted.  I have not seen the parameters of that, as there was in the Michael Scanlon plea agreement.  But I assume there will be a restitution order.

MATTHEWS:  What did they tell your client that they were doing with all this money that they euchred from them, from the tribe?

FAIRCLOTH:  It‘s really an amazing series of e-mails and reports where they would overstate and embellish economic gaming threats and they would overstate and embellish—it was name-dropping to the highest level.  And they would gin these reports out almost weekly, announcing their successes, most of which were fabricated, and they would fabricate and embellish and exaggerate competitive threats.  So it was just an enormous scam.

(CROSSTALK)

MATTHEWS:  So they scared your clients they were going to hit hard by the government if they didn‘t play ball, didn‘t pay the money.  Did they say that—did Abramoff or Scanlon say they could deliver Tom DeLay?

FAIRCLOTH:  No, I don‘t recall there being a mention of Mr. DeLay being delivered.  They did direct that the tribe, along with many other tribes, make direct donations to a number of leaders, federal officials, but I don‘t think that they actually used the words, they could deliver anybody. 

MATTHEWS:  Well why did they make—what was the case they made for paying DeLay money?

FAIRCLOTH:  Along with everyone else, to establish a presence.  I think there is a term in one of the e-mails where they say to create a giving presence or a presence—a supporting presence in Washington.  And the tribe believed that Abramoff knew the secret handshake, he knew the way to get influence in Washington.  And the tribe followed him down that path.

MATTHEWS:  Mr. Faircloth, do you know anything more about this case that‘s going to embarrass public officials?

FAIRCLOTH:  What a broad question.  Yeah, I probably do.  How much more I‘d be willing to disclose I‘m not sure, but to answer your question honestly, probably so.

MATTHEWS:  Do you think it‘s going to hurt Tom DeLay?

FAIRCLOTH:  Not really from what I‘ve seen.  It‘s hard to say.  I mean, his name, along with many other names, were included in the giving list that was sent to the tribe for them to make contributions—for the tribe to make contributions.  But I am not aware of any paper that directly links Mr. DeLay to any specific conduct. 

MATTHEWS:  OK, thank you very much, Mr. Faircloth.  Jimmy Faircloth.

FAIRCLOTH:  You‘re welcome.

Join us again tomorrow night at 5:00 and 7:00 Eastern for more HARDBALL.  “COUNTDOWN” with Keith Olbermann starts right now.

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