updated 3/1/2006 11:01:16 AM ET 2006-03-01T16:01:16

Guest: Carl Levin, Charlie Cook, Kay Bailey Hutchison, John Holmes, Peter Peyton, Margaret Carlson, Richard Wolffe

CHRIS MATTHEWS, HOST:  Tonight, black day at the White House: 

President Bush earns his worst job approval number ever -- 34 percent—his worst number for handling the war on terror, and total rejection on the ports issue.  Worse yet, his vice-president‘s job approval is a brutal 18 percent.  Let‘s play HARDBALL.

(MUSIC)

Good evening.  I‘m Chris Matthews.  Welcome to HARDBALL.  Devastating new poll numbers for the president‘s performance, as he heads to India.  A “New York Times”/CBS News poll shows President Bush‘s job approval rating at an all-time low of 34 percent, with 70 percent opposed to the Dubai Port deal.  And when it comes down to who do you trust, another new poll finds three out of five Americans now say that Congress should take away control of the ports from the president. 

The big question tonight—deal or no deal?  Will an Arab-owned company ultimately take over operations at six U.S. ports?  And has President Bush lost the trust of the American people on the core issue of his presidency—National Security?  We‘ll talk to MSNBC‘s Pat Buchanan and Monica Crowley.

And later, another bloody day in Baghdad.  At least 66 people have been killed by suicide bombers today, mortar attacks and car bombs and other causes as the country teeters on the edge of an all-out civil war.  More on this later.

But first, HARDBALL‘s David Shuster has this report on the rough political landscape for President Bush.

(BEGIN VIDEOTAPE)

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  I, George Walker Bush, do solemnly swear—

(END VIDEO CLIP)

DAVID SHUSTER, HARDBALL CORRESPONDENT (voice-over):  It‘s the president‘s lowest approval number since he got the job.  And aside from Richard Nixon, it is the lowest number for any second term president in more than 50 years.  At this point in their presidencies, Eisenhower‘s approval rating was at 58 percent, Reagan 65 and Clinton 57.  George W.  Bush stands at 34 percent. 

Perhaps the biggest blow to President Bush, is that he now finds himself fighting with his own party over an issue that helped get him reelected:  post 9-11 national security. 

(BEGIN VIDEO CLIP)

BUSH:  I can hear you.  I can hear you—the rest of the world hears you.  And the people—and the people who knocked these buildings down will hear all of us soon. 

(END VIDEO CLIP)

SHUSTER:  In the wake of the terror attacks, the president‘s approval rating in handling the war on terror stood at 88 percent.  And even a year ago, nearly four years after 9/11, it was 61 percent.  But now the president‘s approval rating on the war on terror has dropped to 43.  Some of that loss may come from his support for the transaction that would let a state-owned company from Dubai control six U.S. ports. 

(BEGIN VIDEO CLIP)

BUSH:  If there was any doubt in my mind or people if my administration‘s mind that our ports would be less secure and the American people endangered, this deal wouldn‘t go forward. 

(END VIDEO CLIP)

SHUSTER:  But the public has doubts -- 70 percent of Americans oppose the deal, including 58 percent of Republicans.  After welcoming a 45-day review of the port transaction, the president is beginning to gain back some support from Republicans in Congress, including Congressman Peter King and Senate Republican leader Bill Frist. 

But while the president may be getting a short reprieve on the port deal from his party on Capitol Hill, the slow recovery on the Gulf Coast from Hurricane Katrina is weighing his numbers down.  Two weeks after the government‘s slow response to hurricane victims, Americans were asked about the president‘s approach to Katrina and its aftermath, and 44 percent approved.  Now, six months later, with neighborhoods still in ruins, and New Orleans‘ population roughly half of what it used to be, the president‘s approval rating on Hurricane Katrina has dropped down to 32 percent. 

On Iraq, the president today continued his call for optimism.

(BEGIN VIDEO CLIP)

BUSH:  And now the people of Iraq and their leaders must make a choice.  The choice is chaos or unity. 

(END VIDEO CLIP)

SHUSTER:  But with Iraq facing possible civil war, just 30 percent of Americans approve of how the president is handling Iraq—the lowest number since the war began three years ago.  And the number of Americans who think American efforts in Iraq are going badly is up to 62 percent—the highest level of frustration since the war began. 

(On camera):  The White House can take comfort in one number from the new CBS poll:  two-thirds of Americans say they heard enough about Vice President Cheney‘s shooting incident.  Nonetheless, the vice-president‘s approval rating has also dropped to a historic low, just 18 percent. 

I‘m David Shuster for HARDBALL, in Washington. 

MATTHEWS:  Thank you, David Shuster. 

Democratic Senator Carl Levin of Michigan is the ranking member of the Armed Services Committee, which held hearings today on national security threats.  He also sits on the Homeland Security Committee, and the Intelligence Committee.  Senator Levin, you represent a pretty regular state, if there is one—a lot of guys who own guns, who own boats, sort of rough and ready people out there.  Are they confident of this president‘s leadership? 

SEN. CARL LEVIN (D) MICHIGAN:  No.  They‘ve lost a lot of the confidence because of the failures of this administration to show leadership and to just be competent.  This most recent decision relative to transferring port operations to a foreign country is deeply disturbing, and what is also disturbing is that the administration ignored our law which requires a formal investigation, should there be national security concerns as a result of a proposed transfer, and requires that investigation before the transfer. 

Now what they‘re doing is, they‘re going to go ahead with the transfer and then have the investigation afterwards—a so-called investigation—but that‘s putting, really, the cart before the horse. 

MATTHEWS:  Is there any way you‘ll feel comfortable with the United (Arab) Emirates company, Dubai Ports World, controlling our ports on the East Coast? 

LEVIN:  I start with a real nervousness about a foreign government owning operations—port operations—because they are so critical to our national security.  Our vulnerability is in our ports, perhaps more than any other place, including our airports.  We have so many of our containers are not looked at.  And so I start with a very serious feeling of presumption against foreign government ownership of any port facility. 

That doesn‘t mean if there‘s a thorough investigation, I can‘t be persuaded, but the problem with this investigation is that it‘s a charade if it comes after the transfer.  And as of right now, while they say there‘s going to be a formal investigation, the transfer is going to go ahead apparently before this investigation has begun, much less before it‘s completed. 

MATTHEWS:  Oftentimes, Senator, when you argue in Washington here about an issue, there‘s a middle ground.  One side says spend 10 billion (dollars), the other side says spend 8 (billion dollars), you spend 9 (billion dollars).  Is there a middle of the road position here, or is it up or down on this company—this state-owned company—running our ports? 

LEVIN:  I think it ends up with the administration making a decision up or down.  Hopefully the Congress will insist on a role in that decision.  But there‘s a bipartisan—very serious bipartisan doubt, not only about the transfer to a foreign government, but also by the failure of the administration to follow our law.  You know this administration, I‘m afraid, has a track record of not wanting checks and balances and trying to find ways to get around our laws.

And there‘s a deep feeling in the Congress, a growing bipartisan feeling, that it‘s important that there be checks and balances, and that the administration abide by our law, which is very clear in this case, that if there‘s a national security concern—and there obviously is and was, just talk to the Coast Guard, just talk to a number of other people inside the administration—they obviously raised concerns.  That‘s why the letter of assurances came, in order to address national security concerns.  So once those concerns are there—and they were there, here—that must trigger the investigation which this administration tried to bypass. 

MATTHEWS:  Were you confident of the British company, the P&O company that was running these ports all these months now? 

LEVIN:  I didn‘t have any reason to have questions about it.  No questions were raised.  But when it came to the transfer to Dubai, the 9/11 Commission, for instance, raised some very serious issues as to what Dubai‘s failures were in the war on terrorism, prior to 9/11.  They raised a number of points in the 9/11 Commission report.  They said, for instance, that Dubai or the Emirates was one of three countries that recognized the Taliban, they said that President Clinton tried to persuade the Emirates to strike any relationship, cancel any relationship with the Taliban—that ran into a dead end. 

There was also a front company for the major proliferator of nuclear material, a man named A.Q. Kahn from Pakistan—that front company was in Dubai.  The 9/11 Commission raised a number of other concerns.  They ought to be looked at, and they weren‘t looked at here, because I specifically asked this committee that gave approval of this whether they‘d even talked to the 9/11 Commission, and they had not. 

MATTHEWS:  When you hear the word through the grapevine is that the people in charge of this interagency panel that decided to okay this direct investment by this Dubai company, they all had tin ears or deaf ears.  They raised no concerns.  Does that bother you that people in this administration don‘t seem to have political antennae? 

LEVIN:  Sure it does.  This is the security of the United States, and it‘s got to be first and foremost, before investment—by the way, I heard the secretary of the Treasury the other day talk about the importance of foreign investment.  Security has got to come ahead of investment.  It shouldn‘t even be discussed in the same breath and the idea that they would not talk to the 9/11 Commission—they being the committee that approved this thing for the administration—did not talk to the 9/11 Commission that had raised serious concerns about this government‘s failures relative in the war—taking action in the war on terrorism.  That failure, it seems to me, speaks volumes about just the lack of competence of this administration.

MATTHEWS:  OK, let me ask you about a bigger head‘s up.  Back in the

previous administration—and you were in the Senate at the time, Senator

you may have actually been—had more power because the Democrats were in charge. 

But I‘m thinking back to the last Gulf War and the statements that came out of the White House by the smartest people in foreign affairs.  That‘s Brent Scowcroft, General Brent Scowcroft at National Security; James A. Baker, who was secretary of state; and the president himself, George Bush, the first President George Bush.  All warned us if we went into Iraq, there would be a division between the Shia and the Sunni, that the country would come apart and we‘d be sucked into the middle of that civil war. 

That warning by Republicans, by expert Republicans, looks like it‘s coming true or close enough to be true to be scary as hell.  Why don‘t people in the Senate—why don‘t you call those people as witnesses now and have them come up and say I told you so? 

LEVIN:  This is—well, first of all, I voted against going to war in Iraq for those very reasons and others.  But what we need to do now is to find a way out of Iraq, trying to leave it in better condition than we found it.  And the critical thing which is missing now, Chris, is the need for this administration to tell the Iraqi leadership that we cannot do this for them.  They‘re the only ones that can avoid civil war and that they must—and this is the key issue—they must put together a national government of unity in the next few week, or else we have got to reconsider our presence in Iraq. 

The president on your program just a few minutes ago said something like the Iraqis must make a choice, he said.  Well, the problem is we‘re not putting any oomph behind saying to them they must make a choice.  And if you want to put some real pressure on them to make a choice, tell them, folks, if you don‘t do your thing and get unified, we‘re going to have to pull our troops out. 

MATTHEWS:  You know history, Senator, and the only people that have ever been able to pull together these kinds of situations, which are not really happy people, together, is Tito  in Yugoslavia can pull together all those Balkan countries into one country.  Saddam Hussein in the worst possibly way, you could argue, pulled together those different points of view. 

Do you really believe a democracy, a liberal style, Westminster American style democracy, in its basic liberalism, can hold together people who don‘t want to be together? 

LEVIN:  Not that broadly, but I think there is some national sentiment in Iraq—some.  The only hope that we have that it will produce a nation is if they get the message we‘re not there for an unlimited period of time, we‘re not there unconditionally.  The condition for our continued presence is that you put together that unity government, which they‘re apparently trying to put together. 

But we‘ve got to put some pressure behind our statement.  It‘s not enough to say they have a choice, civil war or coming together.  We‘ve got to say what we will do if they don‘t make that choice towards national unity.  And the only pressure we‘ve got is folks, we‘re going to have to reassess our presence in Iraq if you‘re not willing to unify your country and come together with a national government. 

MATTHEWS:  OK, thank you very much.  Senator Carl Levin of Michigan.  Coming up, the president‘s job approval hits a new bottom.  How much of it is because of this ports deal, this Arab control of our ports, and how much is because of the worsening situation in Iraq, which gets worse every hour?  We‘ll ask Pat Buchanan and Monica Crowley.

And later in the program, a former U.S. Coast Guard officer, a captain whose last assignment was captain of the Port of Los Angeles at Long Beach, what does he think of this port deal and what are the real dangers out there?  There‘s an expert coming on.  You‘re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  For more on the politics of the port deal, we turn to MSNBC political analyst Monica Crowley—I love that name, Crowley.  And Pat Buchanan.  Thank you both.

Monica, do you think the president did the right thing here in sticking to his guns in saying we need to let this company from Dubai run our East Coast ports? 

MONICA CROWLEY, MSNBC POLITICAL ANALYST:  No, I do not, Chris.  And I‘m opposed to this deal.  I have been since the first moment I heard this.  And I think that the president‘s statements on this fail to make any sense, which is why you see his job approval ratings slipping right out from under him. 

This is a disaster of his own making and I understand the administration‘s arguments on this.  They talk about the need for commerce and the free market.  No American companies made bids on this deal, and it went to the highest bidder.  I also understand the need for diplomacy in fighting this war on terror. 

But the paramount issue for the federal government and certainly for the commander-in-chief is the national security of this—of this country.  And you cannot have liberty and happiness without life first.  That‘s what the American people understand.  That‘s why they reelected him last year in 2004.  And I think he is doing damage to his legacy, since it hangs on this one issue of fighting terrorism effectively if he continues to pursue this. 

MATTHEWS:  David Brooks, Pat, the other day in “The New York Times,” said we‘re kicking the Arabs in the teeth if we drop this deal.  What do you think?

PAT BUCHANAN, MSNBC POLITICAL ANALYST:  Well, it‘s the same thing Friedman said, it‘s—you know, this is the work of pitchfork-wielding xenophobes. 

MATTHEWS:  But you are a pitchforker.

BUCHANAN:  That‘s exactly right.  There‘s no doubt about it, we‘re going to be hurt if this deal goes down.  You‘re going to humiliate the people in Dubai, you‘re going say to the Arabs, look, we don‘t trust you guys. 

MATTHEWS:  We don‘t trust the best of you. 

BUCHANAN:  We don‘t trust the best of you as well as we trust the Brits.  That‘s all there is to it.  I agree with Monica, I think President Bush should have gotten out of it.  I think now he‘s going to go down this road, he‘s going to pay a hellish price.  He‘s going to be beaten.  I think at the end, we‘re going to have some kind of deal where it‘s sort—they‘re passive owners of these things...

MATTHEWS:  Do you think that will get past the Congress? 

BUCHANAN:  I think a lot of—I think the president will make it so that he can get to the Republicans to support it. 

MATTHEWS:  OK, here‘s the problem.  Monica, I don‘t want to rub this in, I want to take the other side and challenge you both.  But there is an issue here of gut.  It‘s not intellectual. 

You live in South Philly.  You‘re some, you know, Italian American guy in South Philly, lived there your whole life.  Used to the Navy.  My father and my grandfather, they all worked down there.  You look at the ports, it‘s always been American.  The Navy Yard, the Philadelphia ports.  Now you look up and you imagine a flag flying there from the Emirates. 

BUCHANAN:  Chris, you‘re...

MATTHEWS:  How can—I don‘t care what you say, as long as they own that place, you got a problem politically, don‘t you?

BUCHANAN:  Houston‘s got a problem.  You‘re exactly right.  Bubba gets up in the morning, and he‘s told the sheikhs are going to be running our East Coast ports and he says, has George Bush lost his marbles?  You can‘t get beyond that.  As an emotional thing, it is a complete loser. 

MATTHEWS:  We‘re rebuilding New Orleans at the costs of zillions of dollars, Monica.  The port‘s going to be under the control of the United Arab Emirates.  It doesn‘t make sense that our biggest bailout that we have to do as humanitarian fellow Americans is going to benefit a company over there, isn‘t it?

CROWLEY:  Yes, let‘s just be really clear, Chris.  We‘re not talking about ownership of the ports, we‘re talking about operation of those ports.  So I want to be really clear about that. 

MATTHEWS:  What‘s the difference?  What‘s the difference? 

CROWLEY:  Listen, I oppose this deal—no, they‘re not going to own American soil.  They‘re going to be operating the ports that are there.

MATTHEWS:  OK, well there are distinctions without a difference, because if you own—if I own—if I rent a car, or lease a car for five years, I‘m driving that car.

CROWLEY:  No, but I‘m agreeing with your argument, Chris, that the average guy on the street takes a look at this and says if we‘re fighting this war on terror and every major terrorist attack against the United States since the late 1960s has been committed by a Muslim and/or Arab, OK, then they‘re going to take a look at this and say how in the world are we supposed to be fighting this effectively if the government we‘re entrusting with our national security is going to allow a deal like this to go through? 

You know, Chris, the other night on cable television, they showed the old Tom Clancy movie, “Sum Of All Fears,” and in that movie, toward the end of that film, a terrorist is able to smuggle in a nuclear weapon through the Port of Baltimore and they detonate it in a football stadium.

And I think, you know, Americans see this and say this could happen and there‘s so much that could go wrong in this war on terror.  You can‘t monitor every inch of the border and so on, why give away control on the one area we can control? 

MATTHEWS:  OK, Monica, is it possible the president knows something we don‘t know?  Does he know something about our relationship with the company in Dubai, with that country, that‘s been servicing our military aircraft and our military fleet?  Could it be that he‘s worried about unsettling that deal—Pat. 

BUCHANAN:  You‘re exactly right, Chris.  The reason he‘s sticking with this is because we have got a tremendous investment in Dubai, but Bush didn‘t know a thing about this deal before it went through. 

This is the problem.  No one with any political sense saw this deal.  You could have just looked at it and said, hey fellows, I mean, Arabs running American ports, aren‘t we going to have a problem? 

MATTHEWS:  Well, where did he get these robots working for him? 

BUCHANAN:  Well, you mean Chertoff and Snow? 

MATTHEWS:  No, not Chertoff, it would be Robert Kimmitt, the guy who‘s head of this inter-agency task force. 

BUCHANAN:  He‘s a bright guy.  I‘ve worked with him in the White House. 

MATTHEWS:  Well, he‘s not that bright or he would have told the president you‘ve got a problem here. 

BUCHANAN:  Somebody politically astute in that whole sub-cabinet group should have woken up and said, look, this is going to look horrible.  

MATTHEWS:  OK, is this the second term problems?  Is this second rate people, second rate minds, making non-political decisions? 

BUCHANAN:  I‘ll tell you what it is.  People are relaxed after they won the playoff game. 

MATTHEWS:  It‘s the second place.  This is the slump and it could get worse, as you know.  More with Monica Crowley and Pat Buchanan after the break.  You‘re watching HARDBALL on MSNBC.  I‘ll never stop mentioning it.  Hark, Watergate.

(COMMERCIAL BREAK)

MATTHEWS:  We‘re back with MSNBC political analyst Monica Crowley and Pat Buchanan.  By the way, that last reference was to my friend Pat here about Watergate, and it is one of the things, Monica, that seems to happen in second terms. 

Can you imagine working at the White House and seeing a piece of paper that came by, an Arab-owned company out of Dubai is going to take over Philadelphia, Boston, Baltimore, New Orleans, Miami.  It‘s going to take over all those ports in the middle of what the president still calls—whether metaphorically or really—a war on terror. 

CROWLEY:  Right, no.  Inconceivable that something like this would be able to go through, even if it did make it through this process, as apparently it did—and I‘m all for the cooling off period, this period of review.

But you would think that some of the political hands in this administration would take a look at it this and say, you know, this president, his sole legacy now is fighting this war on terror effectively and politically, this is going to go over like a lead balloon.  You would think that somebody would have a keen eye on this and raise those questions before it became public. 

MATTHEWS:  Who is tone deaf here, starting at the top?  The president picked Harriet Miers.

(CROSSTALK)

MATTHEWS:  That was so bad a call, that he‘s almost been forgiven for it.  It‘s almost like a mulligan in golf, like it‘s so bad we‘re going to give you that one.  Fair enough. 

The vice-president disappears for a couple of days, he‘s just shot somebody by accident, doesn‘t even call in.  Does that create a sense that the president doesn‘t need to be checked with, that the president is sort of a figurehead at this point? 

BUCHANAN:  No, no, I understand ...

MATTHEWS:  Why don‘t they act like he‘s the boss?

BUCHANAN:  The Cheney thing is Cheney‘s fault 100 percent.  He was told—I mean, he was going to handle it, he‘s vice-president, a Constitutional office, and so he waits two or three days and allows this firestorm to continue.  That‘s not Bush‘s fault. 

MATTHEWS:  He‘s 18 percent, by the way, approval right now, the vice president ...

BUCHANAN:  I know he is. 

MATTHEWS:  Out of 100. 

BUCHANAN:  This is not Bush‘s fault either.  This is a process fault and a fact of a lack of political judgment in this process which has run through all kinds of things.  It is calamitous, but Bush is getting blamed for it.  Personally, I think Bush went along with the thing, but it is not his fault it was done. 

MATTHEWS:  Why is Andy Card apparently going to Treasury at some point here?  Everybody who was first rate in the White House in the first term, Monica, has all gotten their privileged positions.  They‘re all moving up to cabinet agencies.  You know, you‘ve got—what‘s his name—over at—attorney general ...

BUCHANAN:  Right.  You‘ve got Spelling at Education, you‘ve got Condi at State. 

MATTHEWS:  You‘ve got Gonzales, everybody is moving to their position of joy, leaving the vice president—or the president behind with a second rate team.  Why doesn‘t President Bush say to Andy Card or the rest of them, I need you here, I need the first team, instead of letting them all buzz off to where they want to go, their happy hunting grounds? 

CROWLEY:  Well, you know, this is a phenomenon that often happens in second terms, Chris.  This is not unique to this presidency.  The second terms come, the folks who are in there are the first string, they get tired, they get burnt out, they want to move on, they want to try something new. 

You know, it is up to the president to determine who is best for any of these positions at any given amount of time but you can‘t hold a gun to somebody‘s head, so to speak ... 

(CROSSTALK)

MATTHEWS:  OK, is the president suffering from his isolation here, Monica?  It‘s a tough question.  Is this president suffering from the fact he‘s out on the ranch in Crawford?  He‘s in bed at 9:30 at night. 

He doesn‘t meet anybody new the whole time he‘s been in the White House, he‘s stuck with the team he came with so all he can do is give all the jobs to the deputies.  Is that what‘s happened here, Monica? 

CROWLEY:  Well, I think he‘s got a circle of people around him, Chris, who he really trusts, who he really relies on, and he‘s not afraid to confront them.  He‘s not afraid to ask them questions,rMD+IN_rMDNM_ and I think that that group is getting smaller and smaller and ...

MATTHEWS:  Right.

CROWLEY:  ... is not unique to this administration. 

BUCHANAN:  He doesn‘t pick big people from outside, and bring them in. 

MATTHEWS:  Is he afraid of them?

BUCHANAN:  He promotes—no, he promotes from within.  Frankly, he‘s one of those people like the Texan John Connally who didn‘t have a strong staff.  Nixon, for example, brought in Connally, Monaghan, Kissinger, all these people from outside.

MATTHEWS:  Why not the best?  Why not the best?  Anyway, thank you Monica Crowley.  Thank you Patrick J. Buchanan. 

Up next, we‘ll dig deeper into the president‘s plunging poll numbers. 

By the way, the vice president is down to teens in public job approval. 

Plus, key Bush ally Senator Kay Bailey Hutchison of Texas—now she‘s a heavyweight—will be here.  She sits on the Commerce and Transportation Committee.  This is HARDBALL only on MSNBC.

(COMMERCIAL BREAK) 

(MARKET REPORT)

MATTHEWS:  Welcome back to HARDBALL.  New polls show that the American people do not support the president on the deal to let U.S. ports fall under the control of a Middle East country. 

Charlie Cooks‘s on, NBC political analyst and the publisher of the Cook Report, which has its own new poll on this fight.  And what your numbers show you?  We‘ve got it up ready to show right now.  This is the Cook number on port control.  Congress should block the deal, 61 percent. 

CHARLIE COOK, COOK POLITICAL REPORT:  Sixty-one percent with—oop, they put up approval instead.  Sixty-one percent, a block; 27 percent.  Republicans, held then on with the president.  They were about a third supported the president on this, and—but most of the opposition was Democrats and Independents, which surprised me, because most of the noise seems to be coming from conservatives.  But the opposition really is more Independent and Democratic. 

MATTHEWS:  Why do you think the Republicans who are facing reelection in many cases—all the House of Representatives is by law—but why do you think they‘re so determined to get separated from the president on this? 

COOK:  I think that, you know, from a policy standpoint, I don‘t think I‘d necessarily disagree with the president.  But the thing is, this is such a hard thing to defend.   It‘s kind of like the...

MATTHEWS:  You‘re from New Orleans, aren‘t you? 

COOK:  From Shreveport, Louisiana. 

MATTHEWS:  Well, what do you think about the New Orleans port being under the control of the UAE? 

COOK:  The thing is, I think whether the profits go to London or whether they go to Dubai I don‘t think makes a whole lot of difference...

MATTHEWS:  The management...

COOK:  ... who operates it.  Who‘s actually doing the work matters.  But the thing is, it‘s kind of like the Panama Canal.  You remember back in 1978, where handing over the Panama Canal to the Communists, it was a great issue to demagogue, great—very easy and very hard to defend the policy, even though it turned out to be the right thing to do.  I think it‘s probably the right thing here.

MATTHEWS:  Let‘s take a look at your job approval numbers for the president.  We have the president getting it down to 40 percent in your poll.  How does that square with the CBS poll that‘s coming down at 34 percent? 

COOK:  Yes, CBS had 34.  We had it 40, but CBS was an eight point drop from their previous poll.  It was a seven point here.  So the direction is still the same.  You know, my guess is that somewhere between 34 and 40, but the arrow is dropping. 

MATTHEWS:  What‘s causing the president to lose credibility with the country? 

COOK:  Well, I think a lot of it‘s Iraq.  More than anything else, it‘s Iraq.

MATTHEWS:  Because people do read the papers.  Even if it‘s not on the nightly news, they still catch—it catches their eye.  Every day there‘s more casualties, more disputes between the two sides over there. 

COOK:  And don‘t see progress.  They‘re just not seeing progress.  So between port security and Iraq—but I think more Iraq, to be honest.  It‘s just way...

MATTHEWS:  I do, too.

COOK:  It‘s about 100-pound weight on the president‘s shoulder. 

MATTHEWS:  I think Iraq is like that dream you have.  You‘re worried about something.  You don‘t know whether you didn‘t go to church enough or your finances are out of order.  That thing you always worry about, I think the country worries about Iraq.  It‘s in the back of our souls, I think.

Anyway, joining us right now is Senator Kay Bailey Hutchison, a Republican of Texas.  She sits on the Senate Commerce and Transportation Committee, which met this afternoon to hear testimony on a Dubai Port deal.  The senator is also the author of “American Heroines,” a bestseller which has just been released in paperback.  There‘s a great book.  We‘re showing it right now, Senator, your great book.

SEN. KAY BAILEY HUTCHISON ®, TEXAS:  Oh, thank you.

MATTHEWS:  For some reason, by the way, that sits on our table near our door when I come into the house—in and out of the house every day.  I guess my wife‘s reminding me of your book.

HUTCHISON:  Oh, that‘s very nice.  I‘m very excited that it‘s going out in paperback today.

MATTHEWS:  OK, let me ask you about this deal.  Are you with the president on this or are you distancing yourself from him on this?

HUTCHISON:  Well, I do want to know more.  I listened to much of the testimony and I do want to say that I think UAE has been a strong ally, and they run a very good port system.  However, I do think it is time for us to pass legislation that would apply to every country that is going to import into American ports and have a standard.  And that‘s—that‘s what I‘m proposing.  A standard that we would require everyone to met if they want to ship in to the United States. 

MATTHEWS:  If we set—if the United States Congress were to set a standard by law that said you could not have a state-owned company, would that be the line you‘d want to draw or would it be a company?  Can that be under the control of a company that‘s based in a country which has a certain level of terrorist risk? 

HUTCHISON:  No, I wouldn‘t draw the line at a country.  I do think we should be able to choose which countries are our allies and which ones we have done business with and we trust.  And if we don‘t, I think we ought to be able to put more inspectors in. 

But my legislation would require that any country that is going to ship in would allow our inspectors on the ground there to be able to inspect anything that‘s going to go on a ship.  We need to put cargo seals on that are tamper-proof, so that when they come in to our ports, they can be checked to see if they have been tampered with.  And I think we need a system to track every piece of cargo that comes into America until it reaches its destination. 

MATTHEWS:  Would the people of Texas be happy with a system that allowed the UAE-controlled company to do the port management, even if it had all these oversight responsibilities or oversight restrictions? 

HUTCHISON:  It won‘t be port management.  Port management is local.  But owning a terminal and operating a terminal, yes, I think that they would accept that, as long as we have complete access to that terminal and we have a system in place at the point of embarkation and at the point of entering our country.  I do think we must control, and we must put resources into it.  Today we do not have enough resources into port security, and many of us have been worried about that for a long time, and this is bringing it to a head. 

MATTHEWS:  What do you think is troubling the people in your state?  You have a huge state, Texas—I think it‘s the third largest state.  It‘s got a lot of different kinds of people, as you know.  Are they more worried about the war in Iraq or this brouhaha over the ports? 

HUTCHISON:  Well, we do have a major port that is next to the second largest chemical complex in the world, and so we are very aware of this.  And I have talked to the port officials.  So they seem to think that we have the safeguards if place, and I think we need to beef that up all over the country and even do better.  But I think people of course are concerned about Iraq.  We all are. 

But in Texas, I‘ll tell you, Chris, they want to see this through.  They understand that we are fighting for freedom, and if we lose the stability in Iraq and the ability to show that self-governance can work in Iraq and Afghanistan, the people of Texas know that that would be a tragedy for the future of our country. 

MATTHEWS:  Why don‘t you run for president?

HUTCHISON:  Chris, that is—you know, it‘s just not the right time in my life to do it.  I think I‘m qualified.  If I had the fire in my belly right now, I feel that I could do it.  It‘s not that I don‘t think there are not qualified women.  This isn‘t the time for me.  I think that people may, you know, not want another Texan after we‘ve had a great Texan for eight years, but I think that there are a lot of other circumstances, but thank you for asking. 

MATTHEWS:  Well, here‘s my prediction.  I think whoever wins the Republican nomination, since you‘re not seeking it, is going to ask you to be on the ticket.  Anyway, thank you very much, Kay Bailey Hutchison of Texas.  I want to thank Charlie Cook for joining us.

Up next, we‘ll ask a former U.S. Coast Guard captain about his take on the ports deal.  What should we be worried about?  This is HARDBALL only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  While the president is firm in his belief that the Dubai Ports World company poses no threat to security if it is allowed to manage those six U.S. ports, we want to take a look at overall port security right now, firsthand. 

Peter Peyton is co-chairman of the Port Security Committee for the International Longshoreman and Warehouse Union. 

Also with us from California is John Holmes, a retired captain of the U.S. Coast Guard.  Good evening, gentlemen.

Captain, I want you to start.  What should we be worried about in terms of our ports and terrorism? 

CAPT. JOHN HOLMES, U.S. COAST GUARD (RET.):  Well, I think there‘s a number of things that would be higher on my list than the current business transaction that‘s going on with the Dubai Port Authority. 

I think first of all, we‘d have to take a look at the fact that the ports in this country have no credentialing system for the workers that work in the ports.  So what we basically have is people that work on the docks, that they don‘t have any background investigation, they—and the ports are largely open. 

Now this is not to say that the people that work on the ports, on a day-to-day basis, are a threat to the security of the ports, but you need an access control system so if you know who‘s on the ports, then you have a better idea or understanding of who shouldn‘t be there. 

So that‘s one of the things that I would certainly advocate and put as a higher priority above this transaction. 

MATTHEWS:  OK, let me go to Peter ...

HOLMES:  A second ...

MATTHEWS:  I have to go to Peter Peyton on that very point to get a background here.  You represent the longshoremen.  I was told early on in this dispute that the longshoremen basically provide the work force, you know, the guys who unload these containers. 

He just said—the captain just said there‘s a problem with checking out the people that do work but labor union guys are all carded, you have years to even get the job, right? 

PETER PEYTON, INTL. LONGSHORE & WAREHOUSE UNION:  Right.  It takes many years to get it.

MATTHEWS:  I mean, somebody shows up who is suspicious, would you catch them? 

PEYTON:  Oh, absolutely.  I mean, most of the cases—and I think the captain is aware of this—most of the cases of incidents where something was found was found by a longshoreman who had experience on the docks that recognized something is wrong in this situation. 

The containers that were filled with Chinese people that were smuggled in was discovered by longshoremen.  The cases of a ship coming from somewhere it wasn‘t supposed to be with crew members it wasn‘t supposed to have was found by longshoremen. 

MATTHEWS:  Who caught the stowaway from New York to Dallas, that was my favorite, the guy who was alive inside there having dinner or whatever when they opened up the container. 

PEYTON:  Well, there‘s—longshoremen in many cases have done most of the uncovering of ... 

MATTHEWS:  So you‘re confident that your workforce, from here or international, is capable of policing the people that they put on the docks? 

PEYTON:  Oh absolutely.  Absolutely.

MATTHEWS:  Do you agree with that, Captain, or not? 

HOLMES:  Well, I wouldn‘t disagree with what Peter says, but I would say that, as Peter knows, there‘s more people that work and have access to the docks than just the longshoremen.  There‘s a large cadre of people who drive trucks into the port and then there are people who work for the individual companies and operators.

So I wouldn‘t take exception to the fact that I do not think that the longshoremen are the issue, but I think that in order to know who shouldn‘t be on the ports, you have to have an idea holistically of who is allowed to come on the ports, and I think Peter would agree that there‘s a lot of truckers and other people that have access to the ports that even the longshoremen worry about who they are. 

MATTHEWS:  OK.  Imagine I‘m a—the people like the 9/11 people, I‘m a terrorist who wants to do harm to the United States big time.  So I put some kind of, perhaps, nerve gas aboard a ship, although I can‘t imagine doing it this way.  They‘d probably come in over the Canadian border or something in a private plane or a wheelbarrow rather than this way. 

They put it on the—they load it on a container out in one of these ports like in Dubai or in Cairo, and they put some real dangerous stuff in there.  Who opens it at our end, if it‘s opened in New York, or who goes to that container and opens it up somewhere in private and gets the stuff out of there?  The bad guys?

PEYTON:  Basically, you‘re dealing with one percent of the containers are inspected of all containers that go through the ports, so that means that your chances are you‘re going to miss 99 percent of what comes in, which is what happened with the people who are stowaways. 

So it‘s a very difficult situation when you say well, now you‘re not inspecting containers the way you used to do.  Because there were a lot of inspections we used to do pre-9/11, where it was checking seals, if the seals didn‘t match up, there was something wrong with that ...

MATTHEWS:  Who killed these inspections? 

PEYTON:  It was after 9/11, the companies decided that they didn‘t want to do those inspections anymore.  A lot of the companies on their own said no, we‘re not going to be doing that anymore and that was one of the problems we had with the companies in terms of the security. 

MATTHEWS:  Captain, go to your second point.  Your first point we want to have people checked out on the ports.  What is the other one? 

HOLMES:  Well, I think it‘s a point that‘s being—that you‘re addressing yourself and that is inspecting a greater number of containers, but I would use the—I would put forth the idea that we need to do that outside the United States more than we need to do it inside the United States, because you know, it might be the good news here that when somebody finds something if a container in Los Angeles, but it‘s also the bad news. 

If it were me, I would rather have more inspections overseas so that we find the bad things in a foreign port and we don‘t allow it to get on the ship in the first place, because once it‘s on the ship and once it‘s in the port, you know, you‘ve put the port in jeopardy. So from my ...

MATTHEWS:  Can we put U.S. Customs officials in foreign countries on foreign ports, and have them check the stuff before it gets on American-bound shipping?

HOLMES:  We do have U.S. Customs officials in foreign countries, in foreign ports.  It‘s just that, you know, what we really need is we need to apply more technology, and we need to work with foreign countries to do more inspections instead of a small percentage of inspections.  I‘d like to see a regime where we inspect a greater percentage of containers overseas, as opposed to waiting until they come to the U.S. and then picking out a small percentage and looking at them in the U.S. 

MATTHEWS:  Peter, do you have any problem with this deal with the Dubai company?  The captain says no.  Do you have a problem?

PEYTON:  Well, I think the main thing with this deal is that it‘s shown where we are in our regulatory rules and how little port security we have. 

MATTHEWS:  But bottom line, though, do you think it‘s OK to have an Arab country, an Arab country that owns a company, to control all six of our major ports? 

PEYTON:  I think that if the proper reviews are done and everything works out, that yes, that should be fine. 

MATTHEWS:  We‘ll see what the American people think.  Anyway, thank you, Captain John Holmes and Peter Peyton. 

When we return, why is President Bush‘s job approval hit a new low? 

This is HARDBALL, only on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Here to rip into the many roiling rumbles here in Washington are “Newsweek‘s” Richard Wolffe and BLOOMBERG‘S columnist Margaret Carlson. 

Let‘s do a damage report on the president.  New CBS News-“New York

Times” poll shows the president‘s job approval at 34 percent.  That‘s way

down from last month, which was 42 percent.  His sweet spot is suffering of

suffering half of all Americans disapprove of George Bush‘s handling of terrorism.  That‘s the problem, terrorism.  It‘s always been his strength; now he is down.  Only 43 percent, down from 52 percent last month, where most people trusted him. 

The port deal may have taken a toll on the president, obviously.  When asked should the UAE, this United Arab Emirates company, operate our ports, a whopping 70 percent said no.  Are these dark days for George Bush?  Well, there is an open-ended question. 

Richard, thank you for joining us. 

RICHARD WOLFFE, NEWSWEEK:  My pleasure. 

MATTHEWS:  What is it that‘s moving in the American mind?  You write these big violent pieces for “Newsweek.”  When you have got to put it all together, describe the American worry right now. 

WOLFFE:  Well, the numbers were never very good anyway, but he managed to get through the election with bad numbers, because he had a bad candidate against him.  But you look at the curve of these numbers.  He tanked after Katrina.  He hit another low after Harriet Miers.  What we are seeing now is just that reminder, of the lack of confidence.  Twenty-nine percent of Americans have—give him a positive, favorable rating.  That‘s actually lower than his job approval, way lower than Bill Clinton.  People don‘t think he is a nice guy anymore. 

MATTHEWS:  Wait a minute, you just jumped there.  Are you sure of that last part? 

WOLFFE:  Absolutely.

MATTHEWS:  They don‘t like him anymore. 

WOLFFE:  They don‘t like him anymore.  His job...

MATTHEWS:  Where do you find that in the numbers?

WOLFFE:  It‘s right there in the poll.  His job approval is higher than his personal numbers.  Now, you might think that he‘d be in a situation his father was, where people thought he was a nice guy, but they didn‘t like the job.  In fact, it‘s closer to where Bill Clinton was where they thought, well, there is a problem with this guy, but his job is slightly better. 

MATTHEWS:  What do they think he is?  Just what we used to call smack dance (ph), a rich kid who got a job he shouldn‘t have had? 

WOLFFE:  I just think...

MATTHEWS:  Is that what they think of him? 

WOLFFE:  You know...

MATTHEWS:  Is it that bad? 

WOLFFE:  The thing that we have reported on him, from ‘99, when I first started covering him, was that he was basically a likable guy. 

MATTHEWS:  I thought that. 

WOLFFE:  As the country has got worse and worse in terms of Iraq, the likability factor is less and less relevant. 

MATTHEWS:  Margaret, do you see that?  I mean, I think everybody now knows what we‘re talking about.  It‘s not just job approval.  A lot of people we know can‘t do the job but we like them; a lot of people can do the job, we don‘t like them.  But Richard is saying that his personal repute, what people think of him as a guy, if you will, is down, lower than what we think of his job. 

MARGARET CARLSON, BLOOMBERG COLUMNIST:  Right.  And that‘s always bad, because that was Bush‘s stock in trade.  Even if he was the rich guy‘s son and maybe he wasn‘t experienced and up to the job, unless we wanted to go, you know, have a barbecue in the backyard with him.  Americans have always overrated that characteristic. 

Now that so many things have gone wrong, he can‘t fall back on that. 

He also seems kind of tone-deaf.  Remember from the bullhorn...

MATTHEWS:  Yes, 9/14. 

CARLSON:  In New York all the way to “Brownie, you did a heck of a job,” to being clueless on how people would feel about the Dubai port deal. 

MATTHEWS:  Yes. 

CARLSON:  He has lost his ear.  You know, his Joe Sixpack guy who knew what he would do what we would do because he was a regular guy... 

MATTHEWS:  Yes. 

Gone. 

CARLSON:  ... gone.

MATTHEWS:  So you buy the theory.  You have heard that phrase, smack dance (ph), haven‘t you?  It‘s a tough phrase.  You‘ve heard it before—save me, Margaret, here—it‘s not something I have made up.  It‘s a phrase I grew up with, which is what you would describe a rich kid who‘s had a job and he thinks he‘s a big shot, right? 

CARLSON:  Right. 

MATTHEWS:  He—thank you, Richard, for saving me here.  I have never had any problem with this president personally.  I‘m kind of amazed at this dislike that you believe has crept up here as well as the disapproval. 

WOLFFE:  Totally.  You look at the—you know, Cheney‘s 18 percent number is a personal favorability number.  It‘s not about job approval. 

MATTHEWS:  At a certain number, you don‘t call it favorability.  But it‘s 18? 

WOLFFE:  This is—this is (INAUDIBLE) number.

MATTHEWS:  OK, let me challenge you here.  There was a poll taken—both of you—there was a poll taken in the last election, if had you a break down in your car, a flat tire or something worse, your engine seized up, whatever, your radiator is blowing over and you need to have somebody come by.  You waive down people, who would stop?  And Bush won that.  More people thought he would stop than thought Kerry would stop.  Well, what happened to that?  That‘s about compassion.  He gives a darn about you.  Margaret, you are chuckling. 

CARLSON:  But Kerry would actually maybe know how to change the tire.  Maybe that‘s the difference.  Bush is a good guy.  He would stop.  He would want to help you, but maybe he couldn‘t. 

He wants to fix Iraq.  He doesn‘t seem to have a plan for doing it.  He wants the Dubai thing to work out, but you know, when he heard about it, late in the game, he didn‘t go to what he could have, which is oh, by the way, there is this other 45-day review, let me take a look at this. 

WOLFFE:  And those poll numbers on the ports is just—you listen to members of Congress talking about the ports issue, and they are not saying their constituents...

MATTHEWS:  Did you say issue?  Go ahead. 

CARLSON:  I wish I talked that way. 

(CROSSTALK)

MATTHEWS:  Go ahead. 

CARLSON:  Issue.

MATTHEWS:  This is the lowest thing I have ever done, make fun of a person‘s accident.  Go ahead.

WOLFFE:  Their constituents are calling them, they‘re not saying give us a 45-day review.  They are saying, block the deal.  You know, members of Congress have told me...

MATTHEWS:  Here‘s my question, Margaret.  We‘ve been trusting the president, the American people, to make very complicated decisions about foreign policy.  The decision to go into Iraq, a very complicated country.  Why did the American people trust the president on the most complicated, the most sophisticated decisions, and when it comes to who runs our ports, they don‘t trust him?      

CARLSON:  Well, here‘s the thing.  George Bush says he didn‘t even know about the decision.  He had the perfect opportunity to say...

MATTHEWS:  OK, Margaret?

CARLSON:  What?

MATTHEWS:  I‘ve got to go.

CARLSON:  Oh.

MATTHEWS:  I‘m sorry.  We‘ll come back.  You‘re always wonderful. 

Thank you, Richard Wolffe—and I like your accent. 

WOLFFE:  Thank you.

MATTHEWS:  Margaret Carlson, thank you, dear, for coming on.

Right now, it‘s time for “THE ABRAMS REPORT” with Dan.

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

END   

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