msnbc.com
updated 6/1/2006 9:22:34 PM ET 2006-06-02T01:22:34

Guests: Peter King, Bernard Trainor, Roger Altman, Ed Rollins and Hilary Rosen.

CHRIS MATTHEWS, MSNBC ANCHOR: Today, Bush’s war on terrorism crashed headlong into Bush’s busted budget. Faced with huge deficits, Congress cut hundreds of millions of dollars from security programs, cuts that have hit New York and Washington — the two 9/11 targets — the hardest.

Let’s play HARDBALL.

Good evening. I’m Chris Matthews. Welcome to HARDBALL.

Since the September 11th terrorist attacks, the Bush administration has defined itself by its self-proclaimed war on terrorism and has amassed its political power from President Bush’s promise to keep America safe.

Two cities were the target on that day, New York and Washington.  Today, the Department of Homeland Security, an agency created by the Bush administration, announced it would cut funds to both cities by nearly 40 percent.

Why? How could this happen? And is there a political price to be paid. More on this in a bit.

And later, despite FBI raids, immigration anger and Republican election fears, Denny Hastert now claims the title of being the longest serving Republican speaker of the House in history. How did he do it?

But first, New Yorkers woke up today to the news that the federal government is going to cut anti-terror grants to the places hit hardest or altogether on 9/11 and increase the money to the parts the country that were not attacked.

Here’s HARDBALL’s David Shuster.

(BEGIN VIDEO CLIP)

SHUSTER (voice-over): Less than five years after more than 3,000 people were killed in attacks on the Twin Towers and the Pentagon, the federal government is now slashing anti-terror funds to the Washington, D.C., area and New York City in an effort to redistribute money to 46 cities across the nation.

The anti-terror grants to Washington, D.C., are being cut from $77.5 million to $46 million. New York City’s grants are being cut from $207 million to $124 million. That’s a 40 percent decrease. And the cut, as well as the Homeland Security Department’s assertion that New York has no national landmarks, has left lawmakers infuriated.

SEN. CHARLES SCHUMER (D), NEW YORK: The president promised that he would stand by New York, and I don’t believe the president ought to come back to New York and express solidarity with us until he changes this formula.

SHUSTER: The new formula has meant increases for some cities, including Fort Lauderdale, Florida, and Newark, New Jersey. Other cities are having their grant money maintained. Omaha, Nebraska, is getting $8 million. Louisville, Kentucky, $8.5 million. Toledo, Ohio, $3.8 million.

For months, the Department of Homeland Security has been warning that it was going to make changes. Officials vowed to force more regional cooperation, award the grant money based on risk and cut down on waste, like Segway motor scooters. Last year, police in Santa Ana, California, used part of their money to purchase four of them.

This year, the Department of Homeland Security forced every local government to justify their requests. And in January, Homeland Security Chief Michael Chertoff told HARDBALL it was all going to add up to tighter controls.

MICHAEL CHERTOFF, SECRETARY OF HOMELAND SECURITY: Either we’re going to do this in a disciplined, sensible way and really focus the money where the highest risk is, or we’re going to play politics with it and spread it around like party favors.

SHUSTER: Still, the implication that Washington, D.C., and New York City have been getting money they don’t need isn’t sitting well with area political leaders.

REP. JOSEPH CROWLEY (D), NEW YORK: I can tell you, the gloves are going to be off on this one, and I think the entire New York delegation is outraged.

SHUSTER: New York Representative Peter King, chairman of the House Homeland Security Committee called the cut to New York a knife in the back.  Quote: “I’m going to do everything I can to make them very sorry they made this decision.”

King vows to hit back with a congressional investigation of the Department of Homeland Security, focused on agency’s links to the Duke Cunningham bribery and corruption case.

The Department of Homeland Security gave a $21 million contract to a Virginia limousine service that allegedly brought prostitutes to poker parties at the Watergate complex, attended by defense contractors Cunningham and other members of Congress.

Hearings on the limousine contract could be embarrassing to homeland security officials, at the very time the Bush administration is trying to get Congress to focus on the president’s second-term agenda.

Still, retribution is in the air, over a homeland security risk scorecard that said New York has zero national monuments or icons, despite the Empire State Building, Brooklyn Bridge, and Statue of Liberty.

MAYOR MICHAEL BLOOMBERG (R), NEW YORK: You stop a terrorist, they have a map of New York City in their pocket; they don’t have a map of any of the other 46 places.

SHUSTER (on camera): White House officials today referred this dispute to the Department of Homeland Security, but not before they noted the grant process relied on peer review teams representing police agencies from across the country.

That may help explain why the money was so spread out. But it’s not going to tamp down the political uproar in the two cities that were attacked on 9/11 and would seem to be the most likely to get hit again.

I’m David Shuster for HARDBALL in Washington.

MATTHEWS: Thank you, David Shuster.

Republican Congressman Peter King of New York, of the New York area, is the chairman of the Homeland Security Committee. And he said today that the Department of Homeland Security has declared war on New York City.

Congressman, how did this happen? Your city, New York, was the hardest hit in history by terrorism, and yet it’s been cut for anti- terrorism funds. How’d that happen?

KING: Chris, this is absolutely indefensible. The Department of Homeland Security changes the story by the hour. There has never been one allegation of even one penny being misspent on any of the counterterrorism money in New York.

As David Shuster said, in their analysis they said there were no national icons in New York. I’ve looked further into the backup materials, the conclusions they came to. The NYPD’s Counterterrorism Unit, Ray Kelly is almost 1,000 cops working on counterterrorism and intelligence. It’s the premier unit in the country. Police departments come from all over to observe it.

This so-called peer review panel based their application in the bottom 15 percent. They said there were 467 applications and the NYPD Counterterrorism Bureau’s application ranked in the bottom 15 percent.  That shows either incredible bias, incredible ignorance or, in any event, it shows that that peer review panel or whoever was involved in this in the Department of Homeland Security should lose their jobs. There’s no explanation for this whatsoever.

I’m not begrudging other cities. I mean, Los Angeles certainly has a threat; Chicago, others — I’m not getting into that. But to cut New York City 40 percent when every intelligence threat estimate shows that New York is at the very top, to me is absolutely indefensible and Mike Chertoff and the others at the department are changing their story by the hour.

Today, he apparently said this was an averaging out of the first year and the second year and now the third is an average of the first two, which makes no sense at all — especially when they were coming up with all of these complicated formulas yesterday, which also added up to nothing.

MATTHEWS: Are they screwing Hillary and Chuck Schumer on this one?  Is this politics? Is this red state, blue state stuff?

KING: I don’t think so, because they’ve given a lot of money to Los Angeles and Chicago, both of which are Democratic mayors; the city of Newark, which obviously is Democratic, which also needs it, by the way.

No I think, if anything here, it’s a bias against New York. I saw it last time...

MATTHEWS: By whom? By whom?

KING: I say subway threats to New York — by people in the Department of Homeland Security, people who can’t get out of their own way. People who...

MATTHEWS: But Chertoff — isn’t Chertoff a New Jerseyite or a New Yorker himself? He’s from up around there.

KING: Yes, he worked in the U.S. Attorney’s Office under Giuliani, and he was U.S. attorney in New Jersey. But having said that, there’s a bureaucracy at the Department of Homeland Security which undercuts New York any number of times.

And I don’t know how familiar Mike Chertoff was with these final numbers. I heard people in the department say they were running around yesterday once the storm hit trying to find ways to justify it. So I’d like to know...

MATTHEWS: You’re well placed, you’re the chairman of the committee, Congressman — who in the White House have you talked to today? Name the guys?

KING: No, I haven’t spoken to anybody in the White House. I have sources within the Department of Homeland Security who told me that...

MATTHEWS: Well did a person in the White House make these kind of calls? I mean, is this politically hot stuff, Karl Rove stuff?

KING: That’s why I don’t think it was. This is like Dubai Ports.  Nobody in the White House knew about Dubai Ports either. Mike Chertoff didn’t know about Dubai Ports.

This stuff is handled, I’m afraid, at some middle level, because I don’t think Mike Chertoff knew all the ramifications of this.

By the way, he’s responsible. He’s the guy who’s on the hook for it.  But I have a feeling this was done by mid-level bureaucrats at the department. They come up with some formula that makes no sense, by a peer review panel who’s shrouded in secrecy. And they come up with this way — I mean, how can you possibly cut New York City by 40 percent when they have 1,000 police working on counterterrorism? The city of Chicago has four.

I mean, I can go through all these different comparisons.

MATTHEWS: Do you smell any corruption over at Homeland Security?

KING: I smell incompetency and I smell a bias and I think there’s a real bias against the NYPD. They resent all the coverage they get, all the publicity they get. It’s a real bias, it’s a real narrow-mindedness, and a lot of people over there should lose their jobs.

MATTHEWS: Well, what’s this Duke Cunningham, prostitutes, poker thing all about with Homeland Security? What’s that all about?

KING: What that’s about is that you had the orgies going on at the Watergate Hotel, with prostitutes, pimps, booze, card games, Duke Cunningham, lobbyists, CIA.

The people were driven and the prostitutes were driven to the Watergate Hotel in limousines owned by a company which was run by a crook, which lost two of its previous contracts but was given a $21 million contract by the Department of Homeland Security to drive the top executives of the department around Washington.

Now how they got this $21 million contract is a subject of a real investigation by my committee, and there’s going to be a lot coming out on that. But at the same time, they’re cutting $80 million in New York...

MATTHEWS: What could they give a government agency? You’re talking about kickbacks. They’re giving them prostitutes. What are you talking about on the other end of this deal? If they gave them what you think is a sweet deal or preferred let from the government, what do you think is coming from the other end?

KING: It’s either incompetency or there’s issues we’re looking into as to whether or not other companies were asked not to bid, not to — this story is not over yet.

MATTHEWS: You think...

(CROSSTALK)

MATTHEWS: In other words, Congressman, you think there’s a suspicion that’s logical here why they would hire a company that is all involved in the sleaze at the CIA?

KING: Absolutely. And there’s a lobbyist who was involved with the company who is also involved with Duke Cunningham and somehow mysteriously this company gets a $21 million contract to escort or to drive around the Department of Homeland Security’s top officials.

MATTHEWS: OK, what are you going to do about this?

(CROSSTALK)

MATTHEWS: Let’s talk politics about New York now. You pointed out today that the city is the prime target of the terrorists and we know it will continue, because it always is a prize target; it’s got, as you pointed out, the Statue of Liberty, it’s got the Brooklyn Bridge, it’s got the Empire State Building, lots of iconic targets.

What are you going to do to bolster the funding that’s been cut?

KING: Also, Chris, just two weeks ago, a guy was convicted in federal court of trying to blow up Herald Square. So, I mean, this is an ongoing threat we have against us.

I’m going to do all I can with the investigation to bring in all the people from the peer review panel, bring in Chertoff before the committee, bring in the police commissioner of New York, other police commissioners from around the country, to show how phony this whole process was and put as much pressure as I can on.

Listen, I mentioned yesterday this was a declaration of war against New York. I’m at war with the Department of Homeland Security. I think every well-intentioned member of Congress is, because they realized this was a total miscarriage of justice, totally inexcusable, indefensible. And they are changing the story by the hour.

MATTHEWS: OK. Let’s turn this pillow over a second to the cold side.

Do you hear the buzz that I’m hearing that New York may get the Republican Convention in 2008?

KING: I’m hearing talk of that, and if they do, it’s probably because of the great work that was done by the NYPD...

MATTHEWS: Yes, that’s ironic.

KING: ... in securing New York the last time around.

(CROSSTALK)

MATTHEWS: Because the same time they’re cutting funding for what matters, they may be, you know, shining you guys up with the convention site. I was thinking of that because you mentioned Herald Square and that’s where we were last time.

KING: That’s right, you did your show there.

Also, Chris, you know, again, any time in politics, you can debate whether a bridge should go in a certain place or a highway, whether or not you should cut funding for an agricultural subsidy or something, but here we’re talking about life and death.

I mean, this is really serious stuff. I lost, again, over 150 friends, neighbors and constituents. And I have cops and firemen all over my neighborhood. I can’t walk more than a few streets without seeing a street sign and a street dedicated to some guy who was killed on September 11th. So, I mean, this is a real issue for us, and for them to do it so casually, not to tell anyone in advance...

MATTHEWS: Have you talked to Chertoff today, the secretary of homeland security, have you talked to him yet?

KING: No, I spoke to Foresman yesterday, the undersecretary, and the excuse he gave me was he said New York City just wants the money, doesn’t want to tell us how they’re going to spend it. I lost it with that. was the most heated conversation I’ve ever had with an appointed official.

For him to suggest that New York just wants to grab on to money, when I can tell you every penny that New York has spent on homeland security over the last four years has been accounted for, it’s been well spent, it’s received the highest grades.

So this to me just shows a real bias these guys have. Somebody is being cute in that department. We’re going to find out who and why.

MATTHEWS: Do you think Karl Rove was involved in this decision or was it something he missed and therefore is to blame for that reason?

(CROSSTALK)

I mean, isn’t it the job of the top — the president’s top political kick (ph) to make sure that people like you aren’t offended?

(CROSSTALK)

MATTHEWS: It’s a noisy city, New York. When it gets pinched, it makes a lot of noise, as you’re doing right now.

I just wonder why — unless they’re going to calculate a red state- blue state strategy of giving favors to the people out in the red areas of the country and screwing guys in New York to make their point, why would they want to offend Peter King?

KING: Chris, I think maybe we’re giving them too much credit.

I think this was incompetency. I wonder how far up even the department this went. Because if they were going to cut New York and Chertoff knew about it, he had a political obligation to tell the president and the White House in advance. I don’t think he did.

MATTHEWS: Let me turn the tables on you a little bit here.

Their defense over at homeland security is that you in Congress, because you have a budget squeeze that we’re all facing in this country — you could argue whose fault it is, but we got one with the deficits rolling up to about a half trillion dollars a year — that you on the Hill cut $600 million from funding for these programs and that each — that Homeland Security Department, they simply had to divvy it out; and you don’t like the way they divvied out the cuts, but you were the guys that cut it overall.

Is that a fair shot at you?

KING: Chris, they’re changing the story by the day.

The actual cuts were about 14 percent to 15 percent. Most of them were recommended by the president. So there’s a 14 percent cut and they cut New York 40 percent. So it doesn’t add up.

No, again, this is like their fifth explanation. None of them work.  They’re phonies.

MATTHEWS: How are you going to fix this problem?

KING: Put as much pressure as I possibly can, keep going on shows like yours and keep bringing these people up before the committee. They’re going to regret the day they ever did this to New York.

MATTHEWS: OK. Thank you very much, U.S. Congressman Peter King of the state of New York.

Coming up, do U.S. troops need ethics training, by that, training in how to deal with civilians? The top American general in Iraq says yes, they do.

Is our military already changing its practices even before the Haditha investigation reaches a conclusion? We’ll talk about it with retired Marine Corps general Bernard Trainor, Mick.

You’re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL.

While the military’s continuing to investigate into the possible killings of Iraqi civilians in Haditha by American troops last November, Army General George Casey, the U.S. commander in Iraq, has ordered core values training for all U.S. and allied troops.

Here to explain what that means and what that can be expected to mean for the military’s final report is retired Marine general Bernard Trainor.  We call him Mick, an MSNBC military analyst.

General, this question, you know, do soldiers and Marines, Army soldiers and Marines need to be told at this point in 2006 that you don’t massacre civilians?

GEN. BERNARD TRAINOR (USMC), RETIRED: No, I don’t think so. I think...

MATTHEWS: So what’s the training needed for here?

TRAINOR: Well, I think what General Casey wants is just a re-emphasis on this sort of thing, to review what’s being taught to the officers and the enlisted men in both the Army and the Marine Corps concerning the rules of engagement and the laws of war and the ethical component, and the moral component of all of that, upon which our operations are based and simply re-emphasizing.

It’s being done. There are very, very good programs, but like everything else, things of this nature need reinforcement.

MATTHEWS: In Vietnam, how did you decide who was an enemy before you killed them?

TRAINOR: Well, it was very difficult. It wasn’t that much dissimilar to what’s happening in Iraq. You’re going down, you’re in the patties and you run into mines, you run into booby traps and then you come upon some villages, and you don’t know whether the villages are friendly or unfriendly, you don’t know whether you’re going to find spider holes there.

But the same rules apply. You have to make a quick decision based upon your understanding of the rules of engagement, which are not reflective, they’re reactive.

In other words, you should have those imbued in you, so you don’t have to think about should I or shouldn’t I, you act automatically based upon your training and your discipline, that you don’t deliberately shoot somebody who is not a threat to you.

MATTHEWS: OK, let’s try to do this judiciously and as friendly as possible to U.S. forces involved in this case, and I’ll probably get blamed on this from the left. But I want to try to do it as fairly as possible, assuming innocence.

If you’ve just been exploded by an explosive device, an IED or whatever, and you look nearby and you see a house nearby and you go over there, and there are people in there, they’re asleep. Can you assume that they knew that was there, because otherwise they would have tripped it?  And especially now there’s reason that may have been the case, because this kid who was interviewed said, “I was listening for the explosion and I heard it.”

If you listen to his interview, maybe there’s a bad translation there — it sounds like the kid knew there was going to be an explosion. They’re sitting there all night watching for something to explode. If you figured they were part of it because they didn’t trip it themselves because they’re there, they knew it was there, or else they would have been tripping it, can you assume they’re the enemy?

TRAINOR: Sure, you can assume that, but that doesn’t have any bearing on what your actions are going to be. You have absolutely no right to kill somebody on the basis of that assumption.

If you think that the person is in fact a terrorist, who is either directly or indirectly involved or either passively or actively, then your role is to take them in for interrogation, not to be a judge and jury and executioner all in one. And when something like that happens, it means that your leadership and discipline is broken down.

MATTHEWS: How do you stop — somebody was saying the other day that in every unit, there are mad dogs, there are people that are just, you know, they want to kill, they love the action, they’re just a little crazy about war, maybe they’re caught up in it too much. Is that the way you see it in the military, I mean, having been in with the marines and combat? Is there always a guy like in the movies, mad dog?

TRAINOR: No no.

MATTHEWS: It’s not true?

TRAINOR: No. There are the aberrations, there are characters like that that come along, but the way you handle that is you get rid of them right away, they’re psychopaths. And you spot a psychopath, and if you don’t, the troops do. Nobody wants to be with a guy like that. All he’s going to do is cause them trouble and grief. So no, you have somebody like that, you get rid of them right away. If you don’t the troops will find a way of getting rid of them.

MATTHEWS: How do you explain a problem where a whole unit seems to do something very wrong?

TRAINOR: Well what happens, as I say, break down in leadership and discipline when this happens. Let me tell you what happens, though. You have a small team out, because they’re not near their company commander or their platoon leader, they’re operating relatively independently and something like this happens. Maybe you have an overflow of frustration, too much bloodshed, they see too many of their friends killed and they go berserk. This can happen, but it’s not justifying it. It’s extenuating, mitigating.

MATTHEWS: Well they lost a really popular guy in the unit.

TRAINOR: Yes, but OK, so they overreact. Now they’re not going to report up the line that they deliberately killed innocent people by any means. They’re not going to put themselves on report, so they say, you know...

MATTHEWS: ... They all get hurt in it.

TRAINOR: Yes, that’s right, OK. So that’s the report that goes up the line, that’s the way it’s registered up the line. But I’m going to tell you when they get back to their base, their forward operating base, whatever it is, their encampment, it’s not long before the word gets out that something strange has happened. And it’s at that point that the leadership, whether it’s a corporal, a sergeant, a lieutenant, captain, all the way up the line, then it’s his responsibility to look into that and say hey, what really went on there?

MATTHEWS: So they’re charged with picking up the scuttlebutt?

TRAINOR: Sure. This happens, the scuttlebutt will be there. And they can choose either to ignore it, which they shouldn’t, or to take action to find out exactly what happened.

MATTHEWS: It’s helpful stuff. Thank you, we’ll be back with General Mick Trainor in just a moment. He’s the author of “New York Times” best seller, hot book right now, “Cobra II,” in the bookstores.

And later, Hillary Clinton kicked off her reelection campaign this week, we all know now. But what’s she really running for, hint, hint? Can we stop thinking about tomorrow. I think that’s our question. We’ll talk with veteran Clinton adviser Roger Altman. You’re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL. Continuing with us is MSNBC’s military analyst, General Bernard Trainor with more on the investigations into the possible killings of Iraq civilians by U.S. troops in the town of Haditha.

And the question, the core values training that’s now been ordered for all fighting forces. Do you think that this shocks the military guys? I mean, you’re a marine, the marines are out there fighting, they all read in the paper, they get back to their units, they’re sitting there talking in the barracks, and in their tents. What’s the reaction from the grunts, the regular fighting guy to the word that some other guy perhaps under the leadership of a sergeant engaged in something like this?

TRAINOR: I think I can talk for all marines, were they’re grunts or not, on this one. First of all, there’s a sense of surprise, shock, but there’s also a sense of empathy. You know, Jesus thank God it wasn’t me that was put in that sort of position, but I can understand, these guys lose their best friend. They’ve been going through all this thing, there’s this enemy that they can’t see, he’s mixed in with the people, you don’t know whether it’s a friend or foe. And it just kind of overwhelms them.  But in no way — well, with rare exceptions, they are going to say, it was the wrong thing to do, because they’re so trained in that moral ethic.

MATTHEWS: Is there a murky area here where they wake up a family in the middle of the night, they think that the father, whoever was going for a gun or — is there a trip-wire moment where somebody does something and everybody says, let’s finish him off?

TRAINOR: No, not in terms of a response. You know, you can make a mistake. It’s like a policeman coming into a raid and he’s faced with the same sort of dilemma. Do you act or don’t you act and you act on the basis of the way you’ve been trained. As I’ve said, the rules of engagement are not reflective, they are reactionary. So yes, you can go in there and you make a mistake, mistakes are made all the time. But when you come in there and deliberately take people out who clearly are not a threat to you, regardless of whether they were involved before...

MATTHEWS: Well that unfortunately, general, is what we’re getting the reports on, that these people were shot at point-blank range, execution style, including the young kids and the old people. That somebody went in there and said, well some unit agree, we’re going to punish this family totally.

TRAINOR: That possibly is the case and I think that’s the charge coming up, but we don’t know the results of the investigation.

MATTHEWS: Is this kind of war, counterinsurgency, almost guaranteed to present situations like this, because you’re fighting — you’re an occupying force fighting people who don’t want you there. They engage in asymmetric warfare against you. Sooner or later, a unit’s going to get hit by a bomb or a rocket or whatever, and they’re going to say, enough of this.

TRAINOR: Just on a percentage basis, yes, people are going to overreact. Now, I fought in two different type wars. In the Korean War, a clearly identified enemy in uniform, in positions, and then fought two tours in Vietnam. Vietnam was entirely different from Korea, because it was amorphous.

MATTHEWS: And this is even worse.

TRAINOR: And this is — that’s right. It’s particularly — it’s worse, and I think it’s very difficult for these kids to be making judgments like that, particularly when they see their friends getting blown away. But once again, discipline, and training and leadership are the key to the thing. They cannot commit crimes such as cold blooded murder.

MATTHEWS: And by the way, apathy and punishment are not separable.  It could be you could feel empathy for them and still have to punish them.

TRAINOR: Absolutely.

MATTHEWS: Thank you, General Trainor.

Tomorrow on HARDBALL, Iraqi war veteran and former Senate candidate Paul Hackett, who is now serving as attorney for a Marine captain under investigation for his role in this very case of Haditha.

Up next, only about 400 days now sit between Election Day 2006 and the Iowa caucuses in 2008. How does Hillary Clinton plan to use those days if, and right now it appears when, she wins a second term in the Senate. We’ll talk to veteran Clinton adviser Roger Altman.

You’re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

(MARKET REPORT)

MATTHEWS: Welcome back to HARDBALL.

Yesterday Hillary Clinton launched her campaign for Senate reelection, but for someone the country knows so well, many questions still loom large.  What is the Clinton partnership all about? What role would Bill play in a Hillary White House, and what does Hillary really believe about Iraq?

Tonight, we tackle all of those questions with a close Clinton adviser, Roger Altman. Roger, we had Howard Wolfson on last night. You’re now at bat. Question: What about the “New York Times” piece that ran last week about the Clinton marriage? Do the Clinton people consider that fair game, to talk about the relationship between the former president and the Senate reelection candidate?

ROGER ALTMAN, HILLARY CLINTON ADVISER: Well, Chris, I don’t precisely know what the Clinton people think but by most standards, everything is fair game. Exactly what the “New York Times” was thinking, putting that on the front page is a bit of a mystery to me, but I wouldn’t argue that it’s unfair game.

MATTHEWS: Does Hillary Clinton, your friend, does she seem offended by that kind of early press coverage of a presidential campaign?

ALTMAN: Not to my knowledge.

MATTHEWS: Let me ask you about her position on Iraq. A lot of people in her party, maybe four out of five Democrats, especially New York Democrats, are against this war, think we never should have gone into Iraq.

Hillary, on the other hand, OK’d the president’s authority to go to Iraq and has subsequently stuck to that position, that that was a decision that she still honors, believes in, is, by most standards, a hawk. How can she lead a dove-ish party as a hawk?

ALTMAN: Well, Chris, first of all, the primaries are a long way off and you know that better than anybody. They’re a millennium away by political standards and the general election is two millennia away.

So none of us knows what conditions will be in Iraq at the time of the Iowa caucuses, let along the general election, and none of us knows how the overall Iraq issue will play, but I think Senator Clinton’s position is very clear, very consistent.

She takes responsibility for that vote. She, obviously, believes that given the information she had at the time, that all of us had for that matter, it was the right vote and she has not recanted it or regretted.

Her — obviously, she’s been highly critical of the way in which the war has been prosecuted, just like most Americans have been of a lack of post-invasion planning, which as we’ve now learned from General Trainor among others in his book, borders on the criminal negligence; the lack of adequate protective equipment for our soldiers.

MATTHEWS: Yes.

ALTMAN: The lack adequate forces as a whole — we all know the failings that have taken place and Senator Clinton has been very outspoken about those, but in terms of whether she believes she cast the right vote given the information she had at the time, the answer is yes.

MATTHEWS: But it’s not just about the future, Roger. A lot of people, especially Democratic activists, who care about big issues like war and peace, are going to remember that when it got to the critical point of decision, she went with the Joe Liebermans and the Jane Harmans. She was one the hawks, where most of the party stood with opposing the war. You don’t think that’s going to be a problem for her in the primaries?

ALTMAN: I honestly don’t know whether that will be a problem or not, because I don’t think the conditions that will prevail politically so long down the road are knowable to you or to me or to anybody else.

But if I had to make a wild guess, I’d say no, they won’t be, because I think voters are looking for character and I think Senator Clinton showed her character in that regard and — by sticking by her principles, which others haven’t. It’s the character that will shine through and people will pay attention to.

MATTHEWS: Let’s talk about character. The former president, Bill Clinton, in the ad that was run at the — the video that was run at the Democratic convention up there in New York the other day, showed Hillary Clinton, the former president saying that Hillary Clinton gave up a lucrative career as a lawyer coming out of Yale Law. Does that — that bothers me, I must say.

What it seems to be saying — and I hear it and I don’t like it — is that if you choose public service, with the lower income that comes with it, that somehow there’s a sense of entitlement like, hey look, I gave up all these millions my classmates are making, therefore I’m either going to clean up afterwards or you owe me. Why does he say that, how she could have made money if she had done something else? Who cares and why should we be told that?

ALTMAN: Well, Chris, I don’t think that’s what President Clinton meant.

MATTHEWS: Well, what did he mean?

ALTMAN: I think what he meant was that she devoted herself over the last 15, 20 years at least, to public service. And that she decided that serving the country and serving the public was her highest calling and that that’s admirable.

And I think it is admirable, whether you’re wearing the uniform of the United States in Iraq or Afghanistan, or serving anywhere else. And I think that’s all he meant by that. He didn’t mean that she’s owed anything. I know Senator Clinton wouldn’t say that at all. And I don’t think there’s any entitlement whatsoever that she thinks is due her.

MATTHEWS: Yes, but is it wrong to brag about the sacrifice of public life? I thought people should thank the voters for giving them the opportunity to serve and not ask to be thanked for sacrifice. I find that a difficult to accept transaction, the notion that somehow people who could make a ton of money who serve the public deserve to be specially regarded rather than those very people who are privileged in their education, should be very happy that the public chooses them to serve them as leaders.

ALTMAN: You’re right. And that’s what Senator Clinton said in her speech. If I can quote that speech from yesterday, she said that having served the voters of New York for the past almost six years was the, quote, “privilege of a lifetime,” unquote. And that’s right out of the speech and that’s what she thinks.

MATTHEWS: Does Hillary Clinton have a sense of humor?

ALTMAN: Yes, she does.

MATTHEWS: Does she?

ALTMAN: Yes, she does. She has a good sense of humor.

MATTHEWS: OK. I’ve been asked to ask this question. What are Hillary’s hobbies? I’m sorry, it’s a hilarious question. Have you any idea what her hobbies are? What does she do besides think about the public and public policy and issues and politics and all that? Does she some other Hillary world out there that we should know about to understand her fully?

ALTMAN: Well, I mean, for example, she loves to travel and I don’t mean just for politics and senatorial duties, she loves to actually travel.  I was with Senator Clinton yesterday flying to — or two days ago, quite the wonderful memorial service for senator and Secretary Lloyd Bentsen.

And she was talking about the trip to Africa that she’d made with Chelsea, a couple of years ago and how she wanted to make another trip to Africa with Chelsea somehow this summer. And she went on and on about how wonderful the trip was and the wildlife was and what she had learned from that. So one thing I can just tell you from two days ago is that she loves traveling and she loves you know, the great experiences that travel provide all of us who do it.

MATTHEWS: That much we all share. Roger Altman, it’s great to have you on.

ALTMAN: My pleasure, Chris.

MATTHEWS:  By the way, what do you think of the new treasury secretary, the president’s appointment, Henry Paulson?

ALTMAN: I think it’s an excellent choice. He’s a really, really good man, he’s experienced, he’s extremely qualified for this job. It’s always important to have a person in that position of that kind of experience and gravitas in case we have a crisis. You know, we periodically had crises, the ’87 stock market crash, the Asian financial crisis.

I think he’s a great choice and they’re lucky to have him and I really admire him going into this job at this time, because we all know that with two years to go in a two-term presidency, it’s hard to get things done.  And the president’s poll ratings are what they are, so he’s really done something quite selfless. And all of Americans, and President Bush especially, should be grateful to him for doing it.

MATTHEWS: Well he has made a sacrifice. Thank you very much. Up next — thank you, Roger. Up next, 2006 is going to be about anything but Iraq. Is it about anything but Iraq? With four out of five Americans believing we shouldn’t have gone to Iraq, can Democrats afford ford to have their best-known candidate — that’s a question I just asked, I’m asking it again. How can Hillary be a hawk when the rest of the Democrats are doves?

Plus today, House Speaker Denny Hastert became the longest serving Republican in that position in American history. Does Republican success or failure in these coming midterm elections this November depend on this guy’s legislative genius? We’ll see. This is HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL. Election Day 2006 is now just five months away, it’s in November of course. Have Republicans lost their confidence? Sounds like it. Are Democrats sounding too confident? We’ll talk about it with Hilary Rosen, Democratic Strategist, and Ed Rollins, the Republican strategist. He’s also advising KT McFarland, one of the Republicans hoping to beat Hillary Clinton this fall in New York.

Ed Rollins, you’re a tough guy. Assess Hillary Clinton’s performance yesterday in her speech announcing her run for renomination for the Senate.

ED ROLLINS, REPUBLICAN STRATEGIST: Incredible. I mean, she’s a great talent. She obviously has this state, the Democratic Party 100 percent behind her.

MATTHEWS: How good a speech did she give? Did you think her performance was good?

ROLLINS: I thought it is a good performance. I mean, I think that she is getting to be a much better performer and the critical thing is we don’t underestimate her. We’re going to have a tough primary on our side at the end of the day, these people pay attention to us. I think she’ll have a formidable opponent, particularly if my candidate gets the nomination. And I think the reality is — we’ll have to see. We have to bring Republicans back into the fold to be viable, but she is as good a candidate as I have seen. She’s not quite as good as her husband, but she’s a good a candidate as I’ve seen at the Senate level in a long, long time.

MATTHEWS: You’re not just pumping her up because you’re running against her, are you?

ROLLINS: It wouldn’t matter if is running against her not, there’s a talent there, and obviously her husband’s the best political strategist in America, bar none.

MATTHEWS: Let’s go to Hilary Rosen. Hilary, I thought her speech wasn’t too good yesterday. She was unsure how to use whatever notes she had. She was looking down. It just seemed to be an odd day not to be prepared if it was such a big hype.

HILARY ROSEN, DEMOCRATIC STRATEGIST: Well I actually agree with Ed.  I think that she put some things out there that people wanted to hear and I think in some respects, she’s so comfortable in that environment, that she felt like she could really just say some off the cuff and some prepared, and sometimes you go back and forth. But the things she said I think were important.

MATTHEWS: What’s all the dancing and clapping about? Why’d she come to the platform clapping and dancing? What’s the celebration about?

ROSEN: OK, this is the classic politician’s problem, right? You look at political conventions throughout history, they never really know what to do when the crowd is on their feet, the music is blaring. Nobody’s quieted down yet. You know, she’s got some rhythm and she’s excited about what she’s doing and that crowd loved her and she loves them. A lot of friends in the audience. I thought it was a good day for her.

MATTHEWS: Well, let’s turn the mood down a little bit, Hilary. I want to ask you, what did you think the “New York Times” story last week?  I wish I could send it to everybody. We ought to have it linked here. The “New York Times,” Paul (sic) Healy did a front page story right at the top of the paper, a long story, about the Clinton marriage and how all the Democrats — and you know them all better than I do.

All these insiders, the money people, the consultants, abuzz about the situation of the Clintons and how they’re getting along with each other and how that’s going to affect the big bet the Democrats are about to put on this woman.

It’s the Democrats turn, you could say historically, to get the presidency, they haven’t had it in eight years. If they put all their money on Hillary, is that a smart move? And is Bill Clinton going to distract from this with his behavior? Is that something you hear people talking about?

ROSEN: You know, I have to say, I am the last person in the world to cry this, but I just find this whole discussion so ridiculously sexist, that there is no ...

MATTHEWS: Sexist?

ROSEN: Sexist. There’s no rationale for focusing on a candidate’s husband’s love life at this point, who is not even a candidate. I mean, if we went down the list, for every potential presidential candidate between now and the next election, and talked about their marriage, their relationship, the potential extracurricular activities, it’s offensive, and I actually think.

MATTHEWS: Why don’t we just limit that discussion to people who have been impeached over the issue?

ROSEN: I actually think that people were offended when they read.  They were serious, but offended.

MATTHEWS: Why don’t we just limit the discussion to people who have been impeached over the issue.

ROSEN: Well, you know why? Because nobody was scrutinized the way he was. Are you claiming, Chris, really that that’s the first political marriage where there’s an ...

(CROSSTALK)

MATTHEWS: No, I think Margaret Trudeau embarrassed the hell out of her husband when he is he prime minister of Canada. She was all messing around with movie stars of whatever in the old days. I mean, this isn’t the first time this story has made tabloids.

ROSEN: You know, look, I think what people want in their presidents, in their senators, and in their elected officials is some authenticity. I think they want her he to be the best senator she can be and if she’s ever a presidential candidate, she’s going to have to figure out how to talk about her life in a way that relates to the American people.

MATTHEWS: So you don’t think he’s going to be a distraction, even though he already is on the front page of the “New York Times"?

ROSEN: Well, I’ll tell you something. If the Republicans think that playing dirty with the Clintons marriage is going to be a way to knock — whoa, whoa, whoa — excuse me.

MATTHEWS: They’re not playing dirty. The “New York Times” — liberal “New York Times” put this on the front page.

ROSEN: If people believe ...

MATTHEWS: Bill Keller put this on the front page.

ROSEN: People are trailing, people are tracking, people are trying to dig up everything they can.

MATTHEWS: OK, it’s a vast right wing conspiracy.

ROSEN: If people believe that’s going to be a successful strategy ...

MATTHEWS: If that’s going to be the Democrats’ position on Bill Clinton, he’s going to love it.

ROSEN: No, I’m not speaking for the Democrats. I’m speaking for someone who just thinks that if this is going to be the subject of the presidential election, nobody is going to win in this.

MATTHEWS: OK, this wasn’t fed by the Republicans. This is the “Times” decision. We’ll be right back with Ed Rollins and Hilary Rosen in a moment.

Coming up, nine out of 10 Americans give the FBI — catch this — the high sign to search congressional offices. They’re fine with going into Bill Jefferson’s office. Raid all the offices as far as the public is concerned. You’re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS: Welcome back to HARDBALL.

We’re back with strategists Ed Rollins and Hilary Rosen.

Ed, I was giving Hilary a hard time there, Hilary Rosen, but the “New York Times” did make this the story. They’ve opened the gates. Is Bill Clinton going to be a distraction for the next couple of years?

ROLLINS: He’s the most significant player. It’s like asking whether Brad Pitt and Angelina Jolie, are going to pay attention to Brad Pitt? I mean, he’s a big player, and there’s a lot of people who admire his presidency and a lot of people who hated his presidency. So she can’t run free of him, but I think at the end of the day, it’s really about her and not him.

MATTHEWS: OK, let’s go to the big question. Let’s go to Hilary Rosen. You know, I was amazed. We got a new poll that just came out. We got 86 percent, like nine out of 10 people say — here it is — that — nine out of 10 think the FBI can raid a Congressman’s office. I mean, all these crocodile tears from Denny Hastert, the longest serving speaker of the House, doesn’t seem to be in sync with the public here.

ROSEN: Well, you know, Chris, you served in the speakers office.

MATTHEWS: I did. I worked there for 11 years.

ROSEN: You know how important — and you know how important it is when you are sitting in that office to sort of understand and respect the balance of power in the White House and in the Congress.

I think the problem here is that it is so out of sync for the American people that Congress seems to care more about protecting themselves than they do in any of the privacy issues that have come up in the last couple of years with this administration, that the outrage from Denny Hastert and the rest of the leadership saying, well, wait a minute, we want you to protect our offices but, you know, if you are going to go subpoena the phone companies for their records or you are going to go listen into calls, or you’re going to — go do all of that fine.

MATTHEWS: Their biggest priority is their own domestic security. Let me ask Ed Rollins this question. Do you think it looks like the Republicans on the Hill, led by Denny, have something to hide? They get Robert Ney up there. There are all kinds of people under the microscope in terms of criminal investigation.

ROLLINS: The issue here, and you understand it better than anybody having worked up there, is some criminal activity took place. I mean, Cunningham has already pleaded guilty. Several major staff people have pleaded guilty to crimes. This was the scene of the crime.

And if the FBI with a judicial warrant wants to go look for something they think is a criminal activity that took place, they have every right to do that. Richard Nixon discovered a long time ago that if the judicial process runs its course they can get whatever they want and they should be able to get whatever they want.

MATTHEWS: I hate to find agreement here. By the way, somebody mentioned on the show last week that — one of my colleagues that the Capitol Police who work for the Congress should be able to handle this.  The Capitol Police don’t have a bunko squad. They don’t investigate ethics violations. They protect the place and try to stop the drunken drivers once in awhile.

ROLLINS: Remember, it still was a judicial warrant that had been served by a federal judge. And at eight months they tried to get the documents and he wouldn’t give them up. So, obviously, they felt they had no other ability to go in and get it.

MATTHEWS: And is your client — or your candidate going to take on Hillary and knock her down somewhere below a three million vote victory or something, here?

ROLLINS: First, we’re going to knock out Spencer, the mayor of Yonkers, and make the debate about Hillary as opposed to potholes in Yonkers. I think the reality is in 10 weeks my candidate, K.T. McFarland, has basically beat the Republican establishment in New York and got a place on the ballot with the governor, the majority leader, and everybody else again her. So I think you’re going to find a much better race that people anticipate. 

MATTHEWS: Ed, we’ll help you with the race in this way. We will host a debate between the two wannabes against Hillary anytime you can delivery both of them. You offered yours tonight, will you?

ROLLINS: Absolutely. You bet. We’ll be on anytime.

MATTHEWS: You give us K.T., we’ll try to get Spencer, OK?

ROLLINS: Great, thanks a lot.

MATTHEWS: We’d love to see a Hillary wannabe debate here.

ROLLINS: Thank you.

MATTHEWS: Thank you, Ed Rollins. Thank you Hilary Rosen, our other Hilary. Play HARDBALL with us again tomorrow night at 5:00 and 7:00 Eastern. Right now it’s time for the “ABRAMS REPORT” with Dan.

Watch “Hardball with Chris Matthews” each weeknight at 5 & 7 p.m. ET

Copyright 2006 MSNBC and Voxant Inc.

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