updated 5/1/2006 6:57:25 PM ET 2006-05-01T22:57:25

Guests: Edward Kennedy, Nicolle Wallace, Gabriela Lemus, Tom Tancredo, Mike Allen

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  Major combat operations in Iraq have ended.  In the battle of Iraq, the United States and our allies have prevailed. 

(END VIDEO CLIP)

CHRIS MATTHEWS, HOST, "HARDBALL":  Let’s play HARDBALL.

Good evening.  I’m Chris Matthews.  Welcome to HARDBALL.  Three years ago today President Bush top gunned a jet and landed on an aircraft carrier decked out with the banner “Mission Accomplished.”

Since that day 2,258 U.S. soldiers have been killed in Iraq and over 17,000 have been wounded in a war that seems increasingly like a mission impossible. 

In a British interview this weekend, General Colin Powell said in planing for war with Iraq he made the case for more troops to Defense Secretary Rumsfeld, General Tommy Franks and President Bush himself.  On Sunday Secretary of State Condi Rice said that she did not remember specifically when Powell pushed for more troop strength. 

And today hundreds of thousands are protesting across the country against politicians who are looking to crackdown on illegal immigration.  Polls show most Americans are sympathetic to illegal immigrants.  Could the boycott backfire?  More on this later. 

What to do about George Clooney?  Ace from “American Idol” and George Bush.  They all have one thing in common.  They all showed up for a meal at this weekend’s White House correspondents’ dinner.  We’ll have some highlights of that event.  First, Senator Ted Kennedy, he’s running for his eighth full term in 2006.  He is the author of a new book called, “America, Back on Track.”    Congratulations with your new book you’ll probably get reelected again. 

SEN. EDWARD KENNEDY (D), MASSACHUSETTS:  Hopefully.  Greatest public honor of my life.  We’re working hard. 

MATTHEWS:  Do you think you might end up being the senator with the longest ever. 

KENNEDY:  That isn’t a statistic I’m enormously interested in.  I’m young and looking forward to the future.  I’m a future candidate.  That’s what I am thinking about. 

MATTHEWS:  Are you going to have opposition? 

KENNEDY:  Yes, there are two Republicans that are running.  The final closing date is next week and you never know what is going to happen at the end.  So we take it seriously.  We’ve been the target of Republicans in domestic and foreign policy issues and always run for the office, not against the candidate.  We’ve worked over these last six years and we’re working hard at the present time.  We’ve got a full good campaign in place and every hope of being successful. 

MATTHEWS:  Let’s talk about the big issue of our time, Iraq.  Let’s take a look what General Powell had to say over the weekend. 

(BEGIN VIDEO CLIP)

COLIN POWELL, FMR. SECRETARY OF STATE:  I made the case to General Franks and to Secretary Rumsfeld before the president that I was not sure that we had enough troops.  So the case was made it was listened to, it considered.  And those responsible for the troop levels, Mr. Rumsfeld and General Franks and the joint chiefs of staff, including the chairman of the joint chiefs of staff, believed that they had the troop level.  It was not anything that was ignored.  It was considered and a judgment was made by those responsible for making military judgments that the troop strength was adequate. 

UNIDENTIFIED MALE:  With the benefit of hindsight that is a pretty big strategic failure.

POWELL:  Hindsight is a wonderful sight to have. 

UNIDENTIFIED MALE:  From your perspective—

POWELL:  I would have preferred more troops.  This conflict is not over. 

(END VIDEO CLIP)

MATTHEWS:  What do you make of that, Senator? 

KENNEDY:  We never should have gotten into a war.  The best vote I cast in the United States Senate was for not going to the war.  This was the wrong war at the wrong time.  America was uniquely divided after 9/11.  All Americans were for the invasion in Afghanistan.  We had Osama bin Laden on the run and suddenly this administration deflected that and went to war in Iraq. 

Now we will have been battling in Iraq longer than we have been battling for the Korean war.  At the end of this year, our servicemen and women will have been fighting a war that was longer than World War II.  They have performed superbly.  If they can’t find a military solution in that time, it’s time to by those American servicemen home. 

It is political understanding, there has to be the will and decision to make political decisions.  That hasn’t been apparent until now. 

MATTHEWS:  The name of your book is “America:  Back on Track.”  How did your party get off track.  Only 23 of you in the Senate opposed the war when it came up for a vote in October of 2002.  Why did so many Democrats abandon your ship?

KENNEDY:  First of all, there is no question in my mind that we had misinformation, the wrong intelligence.  We were misled in terms of the facts going in to the war.  I had the benefit of being in the Armed Services Committee, virtually every one of the combat commanders that appeared before the Armed Services Committee expressed the kind of reservations for the reasons that we see today, that this was for the reasons that they didn’t go to Baghdad in Gulf One, were the reasons they knew we shouldn’t have had war in Iraq. 

I had that benefit.  There’s no question why we got into this conflict.  We are less secure today than we were at the time that we had Osama bin Laden on the run.  It is a catastrophic mistake and we are going to continue to pay for it, 47 brave young men and women have lost their lives and it continues to go on. 

MATTHEWS: Are you happy with your party leadership?  Hilly Clinton, who everybody sees as the party leader now, still supports the war.  Chuck Schumer, who is chairman of your campaign committee, he supports the car.  Daschle, who was the leader during the vote, was for the war.  Gephardt was for the war.  Your leaders all went with the president and Hillary Clinton to this day is with the president on this war. 

KENNEDY:  First of all, I’ve given what I think is the answer by there was so much around the flag particular time.  And today.  I think there is a general agreement where there are some differences, the general agreement within our party that this is the transition year. 

There’s a general agreement within our party that if the Iraqi government is not going to shape up, there’s going to be a faster withdrawal of American troops.  That is the general sense.  There are individuals who have expressed other views.  That is the general understanding. 

And there is a general agreement that we ought to be having a regional kind of a meeting, similar to the kind of meeting that president Clinton had at Dayton, in order to try to bring the countries together in the region so that they have the full understanding of the security implications of whatever is going to be the future of Iraq.  And there is a general agreement that we have to have realignment of our forces in that area and region. 

I keep talking about a withdrawal from the region, but there is going to have to be a realignment.  There is also a general agreement that it has been this administration who’s failed policy in Iraq has emboldened the Iranians and emboldened the North Koreans. 

There is a general agreement within the Democrats that because we have the requests for additional nuclear weapons, which this defense department has asked for in the last two years, there is some additional recognition that we are ambiguous when he tell the Iranians you can’t go nuclear and we are building additional nuclear weapons.  There is lot of areas where the Democrats are united.  They are united on national security and also they are united on a range of other issues. 

MATTHEWS:  On the nuclear issue, do you think because, talk to the press today, not just Iran getting nuclear weapons but if they get them there will be a chain reaction.  The Saudis will want them.  They have the money to pay for them.  Perhaps the Egyptians, should we have a regional ban on nuclear weapons which would include Israel?  How else do you stop Iran from doing it? 

KENNEDY:  First of all the rattling of the nuclear saber was not helpful and useful.  The United States never takes a military option off the table but rattling—

MATTHEWS:  You mean by us? 

KENNEDY:  By the United States.  The fact is, we have emboldened Iran. 

We have refused to talk to Iran on issues of, on selective issues we’re willing to do this.  Look, Iran contributes to terrorist organizations.  They present a real danger as a nuclear power.  We have to understand that. 

We don’t take the military options off the table. 

What we do do is to try and work what would be effective sanctions against Iran if they with going to act in an irresponsible way.  We are emboldening the hard-liners in Iraq, in Iran every time that this Defense Department rattles the nuclear saber.  It is unwise.  It is wrong, and it only inflames the situation. 

MATTHEWS:  Do you support Joe Lieberman for renomination in Connecticut?  He is very much for the war, very hawkish.

(CROSSTALK)

KENNEDY:  I’m not in Connecticut.  I’m in Massachusetts.  Let me tell you this.  Joe is an able and gifted and talented person.  And we work very closely with him on the immigration.  I’ve worked with him on a range of civil rights issues and economic issues.  I have a lot of respect for him.  I differ with him on the issues of the war I and understand people having a difference.

MATTHEWS:  Can a good Democrat support the war? 

KENNEDY:  I would rather have them against the war than support. 

That’s my own position.  But I’ve been a member of the Democratic Party long enough to know that we have enormous diversity in the Democratic party.  The great comments Mark Twain said that I don’t belong to any organization I belong to the Democratic party.  We’re made up of a lot of different kind of groups.

But we are Committed and concerned.  If you look at the great march of progress that this nation has made on civil rights, disabilities rights, women’s rights, on education and health, it’s been the Democratic Party.  And they are also the ones that are leading for a more sensible, responsible national security and economic policy.

MATTHEWS:  But this isn’t like 1968 when your brother helped topple a very hawkish administration and now you’ve got some hawks in the Democratic Party.  Do you think you could support Hillary Clinton if she ran as a hawk because she’s been very hawkish on this war?

KENNEDY:  I understand and I have differences with her on that issue.

MATTHEWS:  Could you back her when it came down to it?

KENNEDY:  That is a very important—I intend—look, I’m looking forward to one, my own reelection and the Democrats capturing control of the Senate and the House of Representatives. 

I think we will.  And I think we’ll win in 2008 and I intend to support the Democratic candidate.  I would expect and hopefully by the year 2008, we will not be following what President Bush has stated and that is we will settle the war and what’s going to happen in Iraq after my term of office.  I believe by that time we are well beyond the path towards ending that conflict.

MATTHEWS:  We’ll be right back with Senator Edward Kennedy.  You’re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  We’re back with Senator Ted Kennedy.  His new book is called “America Back on Track.”  What took America off track?

KENNEDY:  I think the appeal to negativism, darkness, the appeal to the dangers of the United States losing its way on national security all after 9/11. 

That was really the policy of Karl Rove and it was the policy of the Republicans.  And what Americans care about national security.  They care about security generally.  And when the effort was made about constantly threatening the security of the American people in each of these elections. 

And if you look back historically, if you look back to George Washington, whether we were going to win the American revolution or look to Abraham Lincoln in the height of the Civil War or look at John Kennedy at the height of the Cuban missile crisis.  They all talk about the politics of hope.

They all talked about the sense of optimism that was part of the American people.  The way of coming together.  That is—we’ve had the politics of division of darkness and divide during the period the last years and we have effectively lost our way. 

Americans do best when they’re individual and challenged and we always did well when we call came together and try and deal with common issues. 

MATTHEWS:  You served in the military, you’re an enlisted guy in the army back in the early ‘50s.  Do you think we need a draft to bring back that sense of—I mean, your brother Robert used to talk about common shared sacrifice.  The rich kids, the pre-meds, they should kick in too.  Do you think that’s something that should be looked at?

KENNEDY:  It certainly ought to be looked at.  Right now, I think it’s

it wouldn’t be—for what we’re facing right at this very—on the Iraqi situation, I don’t think it’s the answer.

But you’re going to have to overlook at it.  We’re going to become engaged, where we’re going to be involved and engaged along...

MATTHEWS:  ... Do we have a credible Iranian threat if we don’t have enough soldiers?  Are we a credible threat to them?

KENNEDY:  Of course we are.  We have pressures on the military, but we have an enormous capabilities.  We have enormous capabilities in our American military here today.   But we’re going to have to—we have to also understand the pressure that has been put on the military, particularly the National Guard, particularly on the Reserve, on equipment in the Iraqi war.  This has been a matter which has been enormous pressure on terms of the service.

MATTHEWS:  There’s two sides to this fight over immigration, it seems.  There’s the tough guys like Tancredo who’s going to be on this show, who want to really close the door and get the illegals out of the country.  There’s guys like you on the liberal side who want to give them a break and a chance to become citizens.  Why don’t you put it all together?  Slam the door in illegal immigration.  Allow people to come in as guest workers, but also legalize the people here and get tough on business that hires cheap labor.  Why can’t you do it all?

KENNEDY:  I’m for it.  You just described the McCain-Kennedy bill as modified...

MATTHEWS:  ... Including tough on illegal hiring?

KENNEDY:  Absolutely, absolutely.  We are a strong support.  We recognize that there are three issues.  One is a national security.  We have over 400,000 coming in here, we don’t know who they are.  So you have to do something there. 

Secondly, you need to be tough on employers who are going to hire undocumented because they are driving wages down and exploiting and creating an underclass.  And you’re also going to have to recognize that the people that are here, the 10 or 12 million, by and large, are the people that care about the kinds of thing that you and I care about, that most Americans care about.

Working hard, devoted to their religion, devoted to their new country, 70,000 of them in the armed forces of this country. 

And we’re saying, “Look, you pay a tax, you pay a penalty, you go to the end of the line.  You obey the law, you learn English.  And if you can demonstrate all of that over an 11-year period, then you have the opportunity to earn citizenship.”

MATTHEWS:  So you’re for requiring to learn English to become a citizen?

KENNEDY:  That’s part of our McCain-Kennedy bill.

MATTHEWS:  Let’s talk about the Star Spangled Banner, the new Spanish version.  The lyrics are a bit different.  In English, I looked at the translation, they’re not quite the same, the spirit’s there.  Do you think the president was right when he said the other day we ought to have an English language Star Spangled Banner and we’ll take that?

KENNEDY:  The Star Spangled Banner ought to be sung in English, period.  I think this is very basically a side show.  I mean, I’ve gone to different events where they’ve sung it in different languages.  But, your specific question, there’s a specific answer.  Should it be sung as the representation of this country in English?  The answer is yes.

MATTHEWS:  You’ve made news.  Senator, the name of the book deserves our mention.  The book—it’s a good book, lots of stuff.  It’s the Democrats answer to everything that is going on right now.  The Ted Kennedy answer, “America Back on Track.” 

When we return outed CIA officer Valerie Wilson made her first public appearance since her undercover status was revealed and her career ruined,   Saturday night at the White House Correspondents Dinner.  Up next, we’ll hear from her husband, former ambassador Joe Wilson.  You’re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Well, ever since the White House CIA leak scandal erupted the nation has seen photographs here and there of Valerie Wilson, the CIA operative whose identity was blown.  Now thanks to the White House Correspondence Dinner this Saturday night, we have some video.

HARDBALL correspondent David Shuster brings it to us and has the latest serious stuff on the CIA leak case—David. 

(BEGIN VIDEOTAPE)        

DAVID SHUSTER, MSNBC CORRESPONDENT (voice over):  For the first time since Bush administration officials revealed her undercover identity and ruined her career, former CIA operative Valerie Wilson, accompanied by her husband, Joe Wilson, stepped in front of the television cameras, and the red carpet appearance Saturday night at the White House Correspondence Dinner could not have come at a more dramatic moment in the CIA leak investigation itself. 

Prosecutor Patrick Fitzgerald is weighing whether to indict top presidential adviser Karl Rove, otherwise known as Bush’s brain.  And White House supporters are stepping up their argument that unveiling Wilson’s identity was not a crime.  Joe Wilson’s response... 

JOE WILSON, FORMER U.S. AMBASSADOR:  Well, the CIA, I think, has responded, first, by asking the Justice Department to open an investigation.  In and in my judgment, the leak of national security information is a betrayal, at a minimum of one security clearance, certainly of the public trust.  And, I for one, can’t understand how Mr.  Rove remains the payroll of the U.S. government. 

SHUSTER:  Early in the case, Rove admitted to investigators that he outed Valerie Wilson’s identity to columnist Robert Novak.  Novak was the first journalist to publish Wilson’s identity and the first to talk about it to investigators.

And last week Karl Rove testified again he may have spoken about the Wilsons with “Time Magazine’s” Matt Cooper.  Rove said he denied that under oath for the first year of the investigation because of memory problems.  A case of bad memory is Scooter Libby’s defense. 

But in regards to Karl Rove, lawyers in the case say prosecutor Fitzgerald is still troubled by the timing of Rove’s rolling disclosures.  It seems that Rove’s memory perks up with every new indication someone else will expose him. 

When Rove finally began to update his testimony in October 2004, it was just days after Cooper was first held in contempt for refusing to disclose confidential sources.  And Rove did not give Cooper a clear waiver to testify until after Cooper’s appeals had been exhausted nine months later.

In any case, as prosecutor Fitzgerald considers whether to charge Karl Rove with perjury, obstruction of justice or worse, MSNBC has learned new information about the damage caused by the White House leaks.  Intelligence sources says Valerie Wilson was part of an operation three years ago tracking the proliferation of nuclear weapons material into Iran.  And the sources allege that when Mrs. Wilson’s cover was blown, the administration’s ability to track Iran’s nuclear ambitions was damaged as well. 

The White House considers Iran to be one of America’s biggest threats. 

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  Iranians should not have a nuclear weapon, the capacity to make a nuclear weapon or the knowledge as to how to make a nuclear weapon.  And now,that we’ve got the goal in mind, we’re working on the tactics. 

SHUSTER:  But the tactics are not as clear in the midst of record-low approval ratings and the diplomatic and military playing field limited by the U.S. war in Iraq. 

MADELEINE ALBRIGHT, FORMER SECRETARY OF STATE: The world is in total turmoil right now.  Worst I’ve ever seen it.

SHUSTER (on-camera):  And how do we get out of it?  What is the No. 1 issue as far as that, that is related to that turmoil? 

ALBRIGHT:  Iraq. 

SHUSTER:  And what do we do about it? 

(voice over):  The Iraq war is the backdrop to the CIA leak case.  Joe Wilson had criticized the administration’s case for war, and the White House tried to undercut him by leaking, among other things, information about his CIA wife. 

(END VIDEOTAPE)            

SHUSTER:  The Wilsons say they’ve spoken with prosecutor Patrick Fitzgerald twice since the investigation began.  And the last time was several months so, so the Wilsons, like everybody else, they are waiting to see what Fitzgerald decides to do regarding Karl Rove. 

Karl Rove’s attorneys say that they’ve been told by prosecutor Patrick Fitzgerald that no decision will be made, Chris, for at least a week. 

MATTHEWS:  Great.  Thank you David Shuster.

Up next, mission accomplished or mission impossible?  White House Communications Director Nicolle Wallace joins us when we return.  You are watching HARDBALL on MSNBC. 

(COMMERCIAL BREAK)

(MARKET REPORT)

MATTHEWS:  Welcome back to HARDBALL.

Three years ago today, the president declared the end of major combat operations in Iraq.  Today we still have 133,000 troops serving in the war.  The mission is not accomplished.

Here to answer some questions is White House Communications Director Nicolle Wallace.

Nicolle, thanks for coming over here.  It is very nice of you to come over.  Let me ask you about General Powell’s comments this weekend.  Let’s take a look at right now what he said in a British television interview just recently. 

(BEGIN VIDEO CLIP)         

COLIN POWELL, FORMER SECRETARY OF STATE:  I made the case to General Franks and to Secretary Rumsfeld before the president that I was not sure we had enough troops.  And so the case was made.  It was listened to.  It was considered, and those responsible for the troop levels, Mr. Rumsfeld and General Franks and the Joint Chiefs of Staff and include the chairman of the Joint Chiefs of Staff, believed that they had the appropriate troop level. 

And so it was not anything that was ignored.  It was considered, and a judgment was made by those responsible for making military judgments that the troop strength was adequate. 

UNIDENTIFIED MALE:  And with the benefit of hindsight, that’s a pretty strategic big failure. 

POWELL:  Hindsight is a wonderful sight to have. 

UNIDENTIFIED MALE:  Understood, but from your perspective...

POWELL:  In my perspective, I would have preferred more troops.  But, you know, this conflict is not over. 

(END VIDEO CLIP)             

MATTHEWS:  That’s becoming kind of a Greek chorus out there.  Retired generals, retired secretaries of state now saying after the war has been joined and fought all these years that it was fought wrong with not enough troops, all of the other complaints being made.  How does the president feel about that? 

NICOLLE WALLACE, WHITE HOUSE COMMUNICATIONS DIRECTOR:  Well, I think he describes the process that did work was as it was designed to work that all opinions were heard.  He describes a process where he made his views known, but where in the end military judgments were made by our military leaders. 

And the president continues to get his advice about things like troop levels and military decisions from his commanders in the field and from the Defense Department. 

MATTHEWS:  But what does he feel?  To get back to my question about troops that are leaders, not troops—military experts, generals in the field who were an active involvement in the war, not giving him their candid advice then but now giving it now to the press. 

WALLACE:  Well, I think the president enjoys a very close relationship with Pete Pace.  I think you know enough about Pete Pace to know that this is a man of incredible distinction and honor who speaks his mind and doesn’t pull his punches.  And I think the president gets the straight story from his commanders in the field. 

General Casey that someone we’ve all had the benefit of hearing from, he speaks of clarity.  And I think he has a real vision for how the war should be fought and is being fought.  And we also hear from General Abizaid.  So we have all, as an American public, have the benefit of hearing from the generals from whom the president gets his advice on the decisions and the military strategy in Iraq.

I think you asked how the president feels.  The president, you know, certainly feels confident based on the inputs and the feedback that he gets from these generals about our strategy for victory in Iraq.  He’s also heartened by the fact that we have an open process, where adjustments need to be made, they are made.

He gave four speeches in December, each one was focused on a different area, where we had to make serious adjustments.  And I think that all Americans can be heartened that this president who is listening in a very dynamic fashion to his military advisers and whenever and wherever adjustments and improvements need to be made, they are made.

MATTHEWS:  So he has no complaint about these generals speaking out? 

WALLACE:  I think that we can all celebrate that we live in the kind of country where even that as a nation at war everyone is allowed to speak out and speak their mind.  And I think that’s a right and a privilege that we should all celebrate.  It’s a right that we’re trying to spread to places like Afghanistan and Iraq.  It is the essence of our democracy. 

MATTHEWS:  Speaking of countries like that.  Let’s talk about gas, oil. 

WALLACE:  Sure.

MATTHEWS:  Before the war—well, let’s take a look at something that Dan Bartlett, the senior adviser to the president, had to say on HARDBALL a couple of weeks ago. 

WALLACE:  Sure. 

(BEGIN VIDEO CLIP)         

DAN BARTLETT, COUNSELOR TO PRESIDENT BUSH:  The president or no one never said that this war was going to result to cheaper gas prices. 

(END VIDEO CLIP)             

MATTHEWS:  Well, we did check in to that.  And Lawrence Lindsey, the chief economic adviser to the president, did in fact say—and let’s look at the quote now.  At the time he said that—just the opposite.  He said the key issue is oil, and a regime change in Iraq would facilitate an increase in wolf oil, which would tend to oil prices.”  That is Lawrence Lindsey.

And then of course later on, as we went to war, Paul Wolfowitz said, not only would it bring cheaper oil, but that oil of Iran would largely pay for the reconstruction of Iran.  He was quite clear on this—of Iraq.  And now the president’s top guy practically, Dan Bartlett, is denying all that.  What is true? 

WALLACE:  Well, I don’t know the context of Larry Lindsey’s comment.  Certainly the reasons for going to war in Iraq are reasons that you have examined in great detail here and I am happy to go into them.  I mean, having a democracy...

MATTHEWS:  No, no.  I’m sorry.  I will interrupt you for the first time.  I have not done it so far.

WALLACE:  That’s OK.

MATTHEWS:  The context is September 2002, as the argument was made to Congress why we should go to war.  And Lawrence Lindsey, the chief economic adviser to the president, said it’s hard to say whether the economic effects would be positive or negative of war.  There are enormous uncertainties about what might happen.  It depends on the prosecution of the war.  But under every plausible scenario the negative effect is quite small relative to the economic benefits that would come from a successful prosecution of the war. 

Here is the chief economic adviser of the president advising on the benefits which will come from—no one will say we went to war because of oil by itself.  He says the key issue was oil, to repeat him, and a regime change in Iraq would facilitate an increase in world oil and that means cheaper oil for us. 

Isn’t that in fact the word of the president, his chief economic adviser, that Wolfowitz coming out in making the case for war.  We know that Paul was quite a hawk, making the case for war by saying don’t worry about all of the costs after this war because their own oil over there in Iraq is going to pay for it.  These don’t add up today, do they?  Are they still true or are they inoperative? 

WALLACE:  We all certainly enjoy the benefits of 20/20 hindsight. 

MATTHEWS  But this was pre-sight.  This was predictions made to get us to go to war.  And I am just asking you, were they wrong? 

WALLACE:  Well, Chris, even what you read was caveated in a great deal of uncertainty. 

MATTHEWS:  Where?  Where?

WALLACE:  He says there are a great number of uncertainties.  And I think that...

MATTHEWS:  But under every plausible scenario the negative effect is quite small relative to the economic benefits.  Under every plausible scenario, the president’s chief economic adviser is saying we are going to benefit from cheaper oil if we go to war. 

WALLACE:  Well, I think he was speaking...

MATTHEWS:  Is that inoperative?

WALLACE:  He was speaking about the realities of the global energy market and certainly the challenges we see and the pain we feel at a pump is the result of a global energy market that is stretched to its limits.  The demands that countries like India and China put on the global energy market are realities that we are all experiencing.  When we go to the pump it is not just because supplies are tight.  It is because of the impact of the global market. 

MATTHEWS:  I agree with you completely.  I don’t have a tremendous amount of respect for generals coming out of the woodwork and saying things they didn’t say when it mattered.  I think they should have resigned.  I think Powell should have resigned.  If he disagreed on a major point of national interest, he should walk like Cy Vance did it, one of predecessors over desert one, walk out there door, say I disagree with the president, I am honorable man.

To do it now, they are all doing it because it is easy now because the war is going badly.  Let me ask you this, these gentleman, Wolfowitz, who is now at the world bank, Lindsey, who was cashier three months later, did they speak for the president at the time they made these promises that cheap oil was coming our way and the war would be paid for by oil coming from Iraq?

WALLACE:  No, because I don’t know.  And I can’t get into, you know, what they knew at the time.  All I can say is that hindsight is 20/20.  And we can’t ignore the fact that it is this global energy market that is resulting in the pain at the pump that all Americans are experiencing. 

MATTHEWS:  Let’s leave on a really happy note. 

WALLACE:  OK.

MATTHEWS:  My friend Tony Snow, have I hurt him by saying that?

WALLACE:  I don’t think so.  I don’t think so.

MATTHEWS:  He is a great guy. 

WALLACE:  He is.

MATTHEWS:  How did you land him?  What was the selling point for Tony Snow as the new presidential press secretary? 

WALLACE:  Well, you’d have to ask Tony.  And I am sure that all signs indicate that he is going to be ready and willing and able to be out there and be a real strong advocate for this president.  Yes, it don’t think it takes much to convince someone to come in and speak for someone who is truly one of the most enjoyable bosses I’ve ever had to work for. 

And to speak for George W. Bush is a privilege.  We can all really just muck it up.  He speaks with such clarity and he has such conviction.   And he’s really someone who cares much more about doing the right thing than about opinion polls.  And it is a pleasure to speak for someone like that.

MATTHEWS:  The funniest line of the night last Saturday night at the press dinner, which was the president was excellent  We’re going to show a piece of the president and his body double, which is really funny, and quite nice of the president to do it because he is kind of humble.

WALLACE:  Self deprecating.

MATTHEWS:  Self deprecation, yes, to say the least.  He said something about how the Vice President Cheney said he is a good man with a big heart.  And then he paused and he goes, well he is a good man. 

WALLACE:  Yes.  My favorite line was that he survived the shakeup.

MATTHEWS:  Oh, that he did.  Bush did.  You’re great Nicolle.  You’re a great person.  Thank you for coming over here to HARDBALL to our own quarters.  It is very courageous for a White House person.

WALLACE:  Thank you for having me.  It was very nice.

MATTHEWS:  Are you going to bring Dick Cheney along with you next time?

WALLACE:  Sure.

MATTHEWS:  I am going to quote you.

Up next, a day without immigrants.  Will Congress feel the heat from today’s demonstrations across the country?  This is HARDBALL only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Hundreds of thousands of illegal immigrants and their supporters took to the streets today for a national day of action and boycotts calling for the reform of immigration policy in this country.  This was the third such day of protest in the last six weeks. 

Are these efforts helping or just creating a political backlash.  To answer those questions, Dr. Gabriela Lemus is the Director of Policy and Legislation for the League of United Latin American Citizens, known as LULAC.  And U.S. Congressman Tom Tancredo is a Republican from Colorado.  Good evening to you both.  Let’s not have a protest here, let’s have a discussion.  Do the protests help, Dr. Lemus? 

DR. GABRIELA LEMUS, LEAGUE OF UNITED LATIN AMERICAN CITIZENS:  I think the protests are demonstration of the anxiety that is being felt in the immigrant and the Latino community. 

MATTHEWS:  Do they get votes in Congress.

LEMUS:  Only if we go out on vote afterwards.

MATTHEWS:  The people who care about that issue from your side. 

LEMUS:  The people who are citizens, yes.

MATTHEWS:  Congressman Tancredo, do these protests, which we are all going to watch for days in the reruns, do they count?

REP. TOM TANCREDO ®, COLORADO:  They help. 

MATTHEWS:  Help your side? 

TANCREDO:  You bet your life.  I wish they were doing it in every city in America.  When people look out and see thousands, hundreds of thousands of people carrying various flags—

MATTHEWS:  I’m looking at the U.S. flag.  Does that help or hurt? 

TANCREDO:  Today there were many other flags that were flown, singing the national anthem in Spanish.  All these things make people very uneasy.  We really do have a problem here.  This isn’t in some other city, some other town.  This is a big problem in the United States.  I think frankly it does not accrue to the advantage of the folks on the other side of this. 

MATTHEWS:  Doctor?

LEMUS:  I think, yes, we do agree on one thing.  There is a problem and it needs to be resolved, and that is the fact that the system is very broken. 

MATTHEWS:  We just had Ted Kennedy here, a Democrat, a liberal.  He has a very pro-immigration position.  Maybe pro-illegal immigration.  But he says he’s willing to sign on to a true compromise, a bill which would have teeth in it in terms of the border and in terms of illegal hiring and sanctions for people who hire people illegally and a chance to legalize people who have been her for many years and guest workers. 

He says his package, McCain-Kennedy, answers all the questions.  Your response. 

TANCREDO:  Two different things.  He is saying that he is signing on to something new and talking about his own package which answers none of those questions.  His package is an amnesty plan pure and simple. 

MATTHEWS:  You’re saying he was dishonest when he said he was backing a tougher border and tougher sanctions on employers who hire illegally. 

TANCREDO:  They’re not the same thing.  He said, the way you presented it, you said he’s backing that and that McCain-Kennedy is that.  That’s not the truth. 

MATTHEWS:  Which bill does answer the questions.  By the way are you for all the answers or do you want the softer stuff?  Are you willing to take a tougher border?

LEMUS:  Of course.  I think there is ways of defining what a tougher border is.  If we keep reinventing the broken drug control laws that were the stupid wall that they put up there in the first place and didn’t function, it’s not going to get us anywhere. 

If we’re going to look at a tougher border look at issues of satellites and advanced technology, where the human rights problems we have on the border, the 4,000 dead that we’ve seen on the border as result of those walls.  At least the border patrol knows where to pick up these people up and save their lives.

TANCREDO:  Four thousand dead as result of the walls? 

LEMUS:  In large part, yes.

TANCREDO:  Oh my heavens.  First of all where we have walls, the 14 miles of walls, of fence, that exist in the San Diego area, it is hard to find anybody on either side of that fence that would like it taken down because it has improved the quality of life on both sides of the fence. 

LEMUS:  I disagree. 

TANCREDO:  You can go down there and ask them.

LEMUS:  I was down there.  I met with the state legislatures in Chula Vista and they were very clear, this was damaging their communities.  They would like to see greater economic growth and commerce. 

MATTHEWS:  Can we step back to the reality here.  Let me ask you.  I know you speak for LULAC.  You have to speak for the organization and being on television. 

I’ve heard it said if you didn’t have a border, if it was an open field down there on the Rio Grande, basically over time you could go all the way down to Tierra Del Fuego, the end of Latin America, and people would be coming to get to America because the opportunities here are so much greater to have a healthy life, a more economically productive life.  More opportunities for education. 

Everybody—not everybody but hundreds and hundreds of millions of people would move north.  Is that true?  There is so many people want to come to this country that you have to have actual restraint to keep them from coming in dramatically bigger numbers.  Do you agree with that?

LEMUS:  No I don’t. 

MATTHEWS:  If we didn’t have a border, you are saying people wouldn’t be coming up here any faster. 

LEMUS:  I don’t think so.  I think a large part of the challenge is that there are economic displacements down starting from Mexico all the way down to Tierra Del Fuego. 

I think there are a lot of individuals who would like to come to the United States.  I think there’s a demand for the labor.  There is a demand for immigrant workers and unemployment is going down, even wages are starting to level off.  So I don’t see that as being the issue.  Also demographics in Latin America are slowing down.  You are not seeing the population growth in Latin America we used to see. 

TANCREDO:  Pew poll, two weeks ago, 47 percent of the people in Mexico saying, I want out.  Believe me, without a border, they come, and along with them a lot of people from a lot of other countries.  It would be enormous.  The idea that if we just simply abandon the border, only a few folks would wander through, is really crazy. 

LEMUS:  Let’s talk politics now.  You’re the expert.  You’re the chief lobbyist for LULAC.  You ought to know this better than anybody.  The Chamber of Commerce knows a lot more than anybody sometimes.  Will we end up a bill in the lame duck session this year.  After the Congress is voted on, everybody is re-elected, will that be an opportunity for a bill? 

LEMUS:  I think it is an opportunity for a bill, whether or not it

actually moves depends a lot on the fact

(CROSSTALK)

MATTHEWS:  Between one and ten, what are the odds? 

LEMUS:  Fifty-fifty. 

TANCREDO:  After the election.  I’d agree.  Fifty-fifty. 

MATTHEWS:  You agree, thank you very much.  I hope it’s a comprehensive bill for my citizen interest here.  Thank you Congressman Tom Tancredo of Colorado, a Republican.  Gabriela Lemus who is chief policy and legislative director for LULAC.

Up next, can the new faces at the White House turn President Bush’s falling poll numbers around.  Plus, highlights from the White House correspondent’s dinner.  This is HARDBALL only on MSNBC.  Maybe you missed it, maybe you didn’t.  We’ll be back.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Iraq is drowning, polls are sinking, and immigrants are protesting.  Here to dig into this menu of messes is “Time” magazine’s Mike Allen.

Mike, first off, General Allen—I mean, General Allen—you’re Mike Allen.  General Powell.  He said that he pushed before the war started for more troops.  Does that have any power right now?

MIKE ALLEN, TIME MAGAZINE:  Well it does, of course.  And when White House Press Secretary Scott McClellan was asked about this today, he just said, “Well the president got a lot of advice from a lot of people and he appreciated it, didn’t necessarily follow it.”

You were saying earlier, if Secretary Powell felt this way, he should have been public about it at the time.  I think that there’s a lot of people who think this has an element of piling on.  But is it a history of how this unbelievably consequential decision, much more consequential than anybody could have known at the time, is made.  This is an essential data point and nobody’s disputed that.

MATTHEWS:  I’ll repeat what I said.  As a citizen, as a person in Washington, I wish General Powell had been strong in his beliefs and he quit, just quit, walk away.  You’re allowed to resign if you disagree with a major policy decision.

ALLEN:  Even if you disagree with Chris Matthews.

MATTHEWS:  No, you can—you’re doing it sometimes.

OK, let me ask you about the president.  He took to us Iraq upon the advice of a lot of people in the administration, different points of view philosophically.  Does he have that kind of push behind him now in Iran?  Is he going to war with Iran before he leaves office because of the same forces?

ALLEN:  Well I don’t know the answer to the first half of that, but no, of course it’s not because of the same forces.  But you can see...

MATTHEWS:  ... The forces of ideology, of this neoconservative, this idea we have to be forward leaning—it is not the Powell doctrine, it’s the Rumsfeld doctrine, it’s the Cheney doctrine, it’s the Wolfowitz doctrine.  Does he have that kind of push now behind him?

ALLEN:  Well as you know, acting strong despite the consequences are of the underpinning philosophies of this administration.  As you know, they did that even during the recount, before they’d won.  They’d acted like they won. 

And the forward-leaning phrase they use is something that they have always used about their approach to foreign affairs.  Republicans tell us that looking strong, talking strong, acting strong on Iran is important.  That if the president with his numbers where they are, it were to back off or act like he was ceding it to others, that that would be an opportunity for the Iranians to make mischief, as you’ll hear this administration say.

MATTHEWS:  Oh, please come back, Mike Allen, thank you, it’s a pretty short interview.

ALLEN:  Happy May Day.

MATTHEWS:  Thank you.  President Bush poked fun at himself at the White House Correspondents Dinner Friday night with the help of a Bush impersonator and this guy is good, take a look.

(BEGIN VIDEOTAPE)

BUSH:  Members of the White House Correspondents Association, distinguished guests, ladies and gentlemen.

STEVE BRIDGES, IMPERSONATOR:  Here I am.  Here I am at another one of these dang press dinners.  I could be home asleep, little Barney curled up at my feet.  But no, I’ve got to pretend I like being here.

The media really ticks me off.  The way they try to embarrass me by not editing what I say.  Well, let’s get things going or I’ll never get to bed.

BUSH:  Thank you, Mark.  I’m absolutely delighted to be here, as is Laura.

BRIDGES:  She’s hot, muy caliente.

BUSH:  As you know, I always look forward to these dinners.

BRIDGES:  It’s just a bunch of media types, Hollywood liberals,  Democrats like Joe Biden.  How come I can’t have dinner with the 36 percent of the people who like me?

The only thing missing is Hillary Clinton sitting on the front row, rolling her eyes.  There’s got to be a friendly face out there somewhere.  There is Justice Scalia, there is Justice Alito.  Hey, boys, bet it feels good to be out from under those robes.  Toga, toga, toga, toga!  There’s Alex Trebek from “Jeopardy!”  That boy is smart.  He knows a lot.  Maybe should I put him on the Supreme Court.  Let’s see the Democrats block that one.

BUSH:  You know, it is good to see so many influential guests here, Justice Scalia, Justice Alito.

BRIDGES:  Yes, all the usual suspects.  Speaking of suspects, where’s the great white hunter?

BUSH:  I’m sorry Vice President Cheney couldn’t be here tonight.

(END VIDEOTAPE)

MATTHEWS:  Well the imitator was the subconscious and the president was the public Bush.  It was unbelievably self-deprecating.

ALLEN:  It was.  Unlike Stephen Colbert, who went over about as well as David Letterman at the Oscars.

MATTHEWS:  Why do you he was so bad, Colbert?

ALLEN:  It really made you miss the gentle, more artful way that somebody like Jody Powell.  You know, Stephen Colbert is one of the most influential people of America, “Time” 100.  The issue on the stands right now has a great tribute to him by Brian Williams, very clever.  But you have to have a sense of the room and as you know, the standard at these dinners is singe, not burn.  He didn’t achieve that.

MATTHEWS:  The president’s our head of state, not just a politician.  Thank you, Mike Allen.  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.

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