updated 7/13/2006 10:35:01 AM ET 2006-07-13T14:35:01

Guests: Lawrence O‘Donnell, Matthew Sheffield, Jon Friedman, Bo Dietl

TUCKER CARLSON, MSNBC HOST:  Welcome to the show.  I‘m Tucker Carlson, taking over the timeslot recently vacated by Dan Abrams, his program about justice.  Well, this is a program about injustice.

On the left, on the right, no secret agendas on this show.  We‘ll tell you always what we think every day, no matter what.  That‘s a promise. 

Coming up, proof positive that Karl Rove was indeed one of sources in the outing of CIA officer Valerie Plame.  The question is, who cares?  Not me.  I‘ll tell you why in just a minute.

Also ahead, terror attacks on trains in India, stepped up security on

our own subways here in the U.S.  But don‘t worry, homeland security is on

the case.  They‘re protecting the country‘s petting zoos and doughnut shops

and a flea market or two. 

Any way to win the war on terror?  I don‘t think so. 

Then, Dan Rather says he‘s a political martyr who lost his job for standing up to powerful forces.  Maybe he‘s just a sloppy journalist.  We‘ll explain the difference in just a minute. 

But first, the latest on the CIA leak investigation. 

Bush haters everywhere are fired up about columnist Bob Novak‘s confirmation that Karl Rove was indeed one of his sources in the outing of Valerie Plame.  Not the first source or the main source, but a source, nonetheless.  It‘s not much, but it‘s enough to keep certain blogs going until Halloween, which incidentally is the official holiday of blogging. 

What does it all mean? 

Well, that, of course, depends on who you ask.  And today we ask Lawrence O‘Donnell.  He‘s the former chief of staff of the Senate Finance Committee.  He was a producer on “The West Wing,” an Emmy winner.  And a year ago he identified Karl Rove as the source of the CIA.  Leak. 

He joins us today from Los Angeles. 

Lawrence, thanks for coming on. 

LAWRENCE O‘DONNELL, FMR. CHIEF OF STAFF, SENATE FINANCE COMMITTEE: 

Good to be here, Tucker.

CARLSON:  Now, last October, which was one of the last times you and I spoke about this, you predicted that Karl Rove was going to be indicted. 

O‘DONNELL:  No I didn‘t. 

CARLSON:  Yes.

O‘DONNELL:  No I didn‘t.

CARLSON:  You said—I just read the transcript again today.  You said that he had committed a crime by lying to an FBI agent, Karl Rove. 

O‘DONNELL:  No.  No I didn‘t. 

CARLSON:  OK.  Well, we can quibble over the transcript later, but...

O‘DONNELL:  Please check it.  Please check it. 

CARLSON:  I just—I just read it.

O‘DONNELL:  You will never find—just for clarity, you won‘t find me predicting Rove‘s indictment. 

CARLSON:  Let me broaden the question.  Why is it, though...

O‘DONNELL:  My last prediction on it before indictment was that he would not be indicted.

CARLSON:  Why isn‘t Karl Rove being indicted then?  If we know now—if everybody says Karl Rove was the source of this leak, the leak that damaged national security, supposedly, why isn‘t he under arrest? 

O‘DONNELL:  Well, because violating that particular law about disclosing the covert agent is a very tricky law to violate.  And the very first thing I ever said about it on MSNBC, on “HARDBALL,” was exactly that, that it was very, very unlikely that they would get any indictments for anyone breaking that particular statute.  And they didn‘t.  And Rove‘s defense on breaking that statute seems pretty clear. 

It also may be, Tucker—this we don‘t yet know, and I‘m not sure what we‘re ever going to find out from Fitzgerald about this in the end—it may be that Valerie Plame didn‘t actually qualify under that statute.  So you could have actually maybe said anything to anyone about her and not violated that statute. 

CARLSON:  Right.

O‘DONNELL:  We don‘t yet know that. 

CARLSON:  Well, it seems very—it seems very clear to me that Valerie Plame did not at all qualify under that statute.  She was not in deep cover.  Anybody who lives in D.C.—you lived here a long time.  You know.

O‘DONNELL:  That‘s not necessary.  Tucker, if you read the statute...

CARLSON:  And I have.

O‘DONNELL:  If you read the statute, you do not have to be in deep cover.  It says nothing about deep cover.

CARLSON:  But hold on.  But hold on here.

We have a much broader question about American national security.  There has been this steady drumbeat from the left from day one about how this leak compromised our national security.  There‘s never been a shred of evidence, as far as I can tell, in support of that contention, but that‘s what people are saying. 

So doesn‘t it surprise you, if in fact that‘s true, if Karl Rove‘s leak to Bob Novak hurt our country, why isn‘t anybody going to jail for it?  I mean, that is confusing, don‘t you think?

O‘DONNELL:  Well, because you have to—you have to—there‘s plenty of things you can do that can hurt the country that don‘t violate a specific law.  You have to violate that specific law to go to jail for the actual disclosure.  And what we—what we don‘t know is exactly what Fitzgerald has on the disclosure. 

Fitzgerald, for example, knows who Bob Novak‘s primary source was, which Bob Novak has not yet revealed, and so Fitzgerald has evaluated clearly that that statute hasn‘t been violated in what these guys did.  What he has is a perjury case, and that became fairly evident just in the briefings that they were doing over the year when they were trying to get Matt Cooper and Miller to testify.

CARLSON:  Right.

O‘DONNELL:  There was a—there was a—go ahead, Tucker. 

CARLSON:  No, I agree with you.  I agree with you completely.  It became clear a long time ago that there were going to be no charges coming out of this case that stem directly from of the original charge, that it was wrong and a crime to leak this information.

So my question to you is, 10 years from now, looking back on this, will we feel the same way about it that we do about some of the Clinton investigations, that—what does this add up to?  Not a whole lot.  It‘s kind of embarrassing, actually. 

O‘DONNELL:  But it has—it has a spiritual connection to the Bush administration that is unlike the others, in that the Bush administration came in saying, we‘re going to be squeaky clean, we‘re not going to do anything like those Clinton people did.  And then, also, there‘s this notion that Republicans and the Republican administration are much more careful about this kind of thing, about national defense, about intelligence matters.  They handle them more carefully than administrations like Clinton‘s would have done, and that‘s clearly proven to be untrue. 

CARLSON:  A spiritual connection?  A spiritual connection?  I mean, come on, look, you know, the bottom line is people are mad at Bush...

O‘DONNELL:  No.  What I‘m talking about is consistency.  No, what I‘m talking about is consistency.  If the Clinton administration... 

(CROSSTALK)

CARLSON:  But you know what‘s going on, Lawrence.  People are mad about the war.  They‘re mad at Bush, they didn‘t like him in the first place.

O‘DONNELL:  No.

CARLSON:  And they‘re mad about Iraq.  It‘s fair to be mad about Iraq.

O‘DONNELL:  It‘s before you get to that.  It‘s before you get to that.

You know that if the Clinton administration had done this kind of leak, there would be an incredible outrage.  And the outrage...

CARLSON:  But the Clinton administration isn‘t in office.  That has nothing to do with anything. 

O‘DONNELL:  No, no, no.  But Democrats—an administration like Clinton‘s appear to be weak on intelligence and weak on defense.  This administration appears to be the opposite.

That‘s why this story has had so much traction.  And the complaint that got the investigation started did not come from any Democrats.  It came from the CIA. 

CARLSON:  Right.

O‘DONNELL:  The CIA requested the Justice Department to investigate it. 

CARLSON:  I don‘t know if you‘re being willfully naive or...

O‘DONNELL:  And John Ashcroft...

CARLSON:  Come on.

O‘DONNELL:  ... the attorney general, started the investigation...

CARLSON:  I know the story quite well.  Right, because there would be a conflict.

O‘DONNELL:  ... against this president (ph).  John Ashcroft started the investigation.

CARLSON:  All of that is technically true.  All of it, as you well know, is misleading.  The CIA  hates the Bush administration for various reasons.  John Ashcroft...

O‘DONNELL:  Oh, yes, that‘s very clear, yes. 

CARLSON:  Well, I think it is clear.  But look, here‘s even the clear...

O‘DONNELL:  There‘s no proof of that.  There‘s no proof of that at all.

CARLSON:  You say—you say—come on.  Come back from Los Angeles. 

We‘ll teach you.

But look, my point, Lawrence, is on obvious one.  If this administration is weak on defense and national security—and I think you can make a pretty good case that they are by doing dumb things like invading Iraq—then why not go after them on those grounds directly? 

O‘DONNELL:  They do.  I mean, politicians do and the left does.  But the CIA said—they said to the prosecutors, we think a crime was committed here, would you please investigate it?   John Ashcroft did. 

This investigation was started by John Ashcroft.  That‘s why we have Patrick Fitzgerald‘s investigation. 

CARLSON:  OK.  Without getting too deep into the specifics of this Byzantine case, it does seem clear, at least there is growing evidence that, in fact, Valerie Plame‘s name was not leaked as part of an organized effort to destroy her and her husband, as they have claimed to “Vanity Fair,” among others, but probably almost parenthetically.

I mean, people are saying, as you know, that Dick Armitage may have been the primary leaker here.  He was an aide to Colin Powell, not a hawk on the war in Iraq.  Hardly a neocon. 

If it turns out Dick Armitage is the source of this leak, everyone is going to have to stop saying, “They were trying to destroy Valerie Plame,” because Dick Armitage wasn‘t going to destroy Valerie Plame.  Come on.

O‘DONNELL:  Well, I‘ve never—I‘ve never accepted that angle that they were trying to destroy Valerie Plame.  It did seem like an incidental part of the story to them, and it did seem to me to be a mistake that they revealed it, with the one exception, the one caveat that Karl Rove is on the record as having said that his wife is fair game.  Wilson‘s wife is fair game. 

So let‘s leave Rove aside.  I don‘t see, except for Rove, I don‘t seewhat the game possibly could have been for the administration to somehow try to hurt Valerie Plame. 

I think they were simply trying to get journalists to stay away from the ideas that Joe Wilson was promoting...

CARLSON:  Right.,

O‘DONNELL:  ... and to tell them their side of the story, which involved a different set of intelligence information to use. 

CARLSON:  Well, I think that‘s...

O‘DONNELL:  And that makes perfect sense as a way of going forward. 

CARLSON:  I think on that score, you‘re completely right.  That‘s clearly exactly what they were doing. 

Lawrence O‘Donnell, thanks for joining us. 

O‘DONNELL:  Thanks, Tucker.

CARLSON:  Still to come, deadly terror attacks in India, beefed-up security in New York City.  Washington is protecting petting zoos?  That‘s right.  The latest outrage from the Department of Homeland Security.

We‘ll bring you more. 

And cable‘s queen of crime makes her second appearance on our “Beat the Press” segment. 

See for yourself just ahead.

(COMMERCIAL BREAK)

CARLSON:  Still to come, Dan Rather returning to television.  Why the 74-year-old has no plans to retire and why he probably should retire.

Plus, we‘ll unveil the five best-kept secrets in the world.  But beware, once we reveal them no one is safe.

(COMMERCIAL BREAK)

CARLSON:  Welcome back.  It‘s time for “Beat the Press.”

First up, Nancy Grace of CNN‘s “Headline News.”

Grace just doesn‘t report the news, she advocates on behalf of it, turning virtually every story into a personal crusade.  In the process, she leaves the impression that moral certainty and factual certainty are exactly the same thing.  And it turns out, you know what, they‘re not? 

Here‘s the most ferocious woman on television from last night talking about a serial killer in Arizona. 

(BEGIN VIDEO CLIP)

NANCY GRACE, “HEADLINE NEWS”:  What I‘m not getting—well, I think I am getting it, but you‘re not telling me, you‘re connecting this guy to shootings of animals.  You‘ve got to be basing this on ballistics.  I mean, who in their right mind would...

UNIDENTIFIED MALE:  Well, Nancy, I have to stop you there.

GRACE:  ... connect the shooting of a horse to the shooting of a person? 

UNIDENTIFIED MALE:  We‘re kind of confusing the two series of cases there.  We were still talking about the baseline killer...

GRACE:  Right.

UNIDENTIFIED MALE:  ... but the other crimes, these crimes of the baseline killer have nothing to do with animals and people. 

GRACE:  OK.

(END VIDEO CLIP)

CARLSON:  Wait.  What‘s that?  Oh, it‘s the wrong guy. 

I don‘t care.  I don‘t care.  He‘s evil.  Kill him and castrate him first.  They‘re all the same. 

More evidence you don‘t have to actually know what you‘re talking about to be really mad about it. 

Nancy Grace.

Well, next up, “The Situation Room” on CNN with my old friend Wolf Blitzer, a genuinely good guy.  Last night, that network was covering a train derailment in Chicago that sent 150 people to the hospital. 

Breaking news.  But apparently it wasn‘t the only breaking news in America. 

Listen to this smooth transition. 

(BEGIN VIDEO CLIP)

WOLF BLITZER, HOST, “THE SITUATION ROOM”:  Clearly an emergency situation having developed in Chicago.  CNN‘s Jonathan Freed is on the story for us.  We‘re going to go there live in a moment, get all the latest information. 

Clearly a significant story involving a passenger train in Chicago, a commuter rail train.  We‘ll get the latest information for you on this in a moment. 

Let‘s move on, though, to some other important news we‘re following. 

Global warming threatening California‘s multibillion-dollar wine industry. 

(END VIDEO CLIP)

(LAUGHTER)

CARLSON:  From train derailment, crisis in Napa Valley.  America‘s Chardonnay supply could be in peril.  Tomorrow, crabgrass threatens your putting green, only on CNN. 

And finally, get out your tissues, Dan Rather is changing jobs.  After more than 150 years with CBS News, rather was forced out earlier this year for running a phony politically-motivated news item about the president‘s time in the National Guard.  It was embarrassing, to put it mildly, but speaking to reporters yesterday, Rather did not sound a bit ashamed. 

“I have baggage and I‘m proud of it.  I‘m committed to independent

journalism, sometimes fiercely independent journalism if need be.  I‘m not

going to be bullied or intimidated by critics   who say, ‘Listen, you

report the news the way I want it, or else.‘”

According to spectators, the former anchor got a little choked up at that point.  He summed up this way: “When you face the furnace, you have to take the heat, and sometimes you get burned.”

Well, sometimes when you propagate phony stories that have no basis in truth that you got from politically motivated sources with very, very falsified backgrounds, and you don‘t accurately apologize and take credit for what you‘ve done, yes, you do feel heat. 

Dan Rather‘s transformation from sloppy journalist into martyr for the troops cannot be allowed to continue.  And we here on this program are going to do everything we can to stop it, including the next segment.  So please stay tuned for that. 

Still to come, the Army says to deal to its biggest contractor.  How Halliburton lost its exclusive multibillion-dollar contract in Iraq.  That just happened. 

And Washington runs on secrets.  From Bob Novak to Deep Throat, we‘ll unveil the capital‘s top five super-duper secrets.

It‘s all coming up. 

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

DAN RATHER, JOURNALIST:  I made a mistake.  I didn‘t did hard enough, long enough, didn‘t ask enough of the right questions.  And I trusted a source who changed his story.  It turns out he misled us, lied to us about one thing. 

But there are no excuses.  This is not a day for excuses.  I made a mistake, we made a mistake, and I‘m sorry for it. 

(END VIDEO CLIP)

CARLSON:  Welcome back.  That was Jimmy Swaggart—I mean, sorry, that was—excuse me, that was Dan Rather almost two years ago, apologizing for his role in a discredited report on President Bush‘s National Guard service.  That moment marked the beginning of the end of his long career at CBS News. 

Well, now Rather is back with a new series on HDNet, the high definition cable network co-founded by Dallas Mavericks owner Mark Cuban.  But the question remains, was Rather a target of the organized right, or was he just a sloppy journalist? 

Joining me he to answer that question, Matthew Sheffield.  He‘s the executive editor of newsbusters.org, also the co-founder of ratherbias.com. 

Matthew Sheffield, thanks for coming on. 

Thanks for having me, Tucker.

CARLSON:  So, conservatives have been after Dan Rather for these many decades.  A lot of liberals in the press, why Dan Rather?  I mean, how do we know Dan Rather is a screaming liberal? 

SHEFFIELD:  Well, you just look at what he says, quite honestly.  I mean, he—if you compare what he says about Republicans and you compare what he says about Democrats, he pretty much—the only bad thing he ever says about Democrats is they‘re not liberal enough.  And he said that about Bill Clinton when he did welfare reform.  He was, like, so, they‘re going to push—he‘s pushing a law that‘s going to, by anyone‘s analysis, put poor children into the streets.

And then with you look at what he says about Republicans, it‘s just they‘re evil, they‘re taking over the world, they‘re destroying the Constitution.  And blah, blah, blah, blah. 

CARLSON:  So—but you‘re—you‘re—in other words, you‘re inferring from his comments, what you believe are editorial comments, his political views, his own political views. 

SHEFFIELD:  Exactly. 

CARLSON:  But has he ever come out and said, you know, “I‘m a Democrat, I support Democrats”?  Has he ever been more explicit about it? 

SHEFFIELD:  Well, he actually did when he was in college.  He was the editor of a student paper there, and he wrote a column, and he said, “Why I Am a Democrat.”

Democrats are the party of the people, and he just went on a long schpiel about that.  And nobody has ever actually confronted him about that on the air, those former statements.  And everybody who knows him at CBS, we had a number of people over the years contact us, and they agreed very much that Dan was liberal, even though he would never admit it. 

CARLSON:  Right.  And, of course, he spoke at a Democratic Party fund-raiser in Texas...

SHEFFIELD:  Exactly.  Exactly. 

CARLSON:  ... not all that long ago. 

Now, to the—to the incidents that effectively ended his career in broadcast television, did he ever—did he ever concede—we just played the sort of apology a minute ago, but did he ever concede that the reprt, the documents that he used to attack Bush‘s service in the National Guard, or lack of it, that they were phony?  Did he ever admit that, it was it a made up story? 

SHEFFIELD:  No, he actually never has admitted that outright.  They said—he said—the official line is, “The documents cannot be authenticated.”  And that, you know, can mean anything other than—it can mean they‘re true, we think they‘re true. 

It can mean they‘re false.  It can mean we think they‘re true, but we couldn‘t prove they‘re true.  I mean, it‘s a very legalistic denial, really.  So it‘s a non-apology apology, essentially. 

CARLSON:  Right.  But we know I think conclusively, I believe conclusively, in any case, that they were false. 

Is this such a bad idea, though, that he‘s going to HDNet?  I mean, the complaint has always been, you know, the big three networks are liberal and they come into our houses, we don‘t pay for them, they kind of force themselves upon us and they push their point of view on us and we resent it.  Therefore, we create FOX News, or whatever.  But that‘s always been the complaint, correct?

But this is really narrow casting.  I mean, this is going to be essentially a service.  If you‘re liberal and you want to watch Dan Rather, you pay for it, and you can.  Or you pull him up and you can.

I mean, that‘s not bad, is it?

SHEFFIELD:  Yes.  Well, more power to him.  But it just shows that, you know, that‘s the kind of audience that he has left. 

I mean, you know, if you look at the ratings for “CBS Evening News” over the—over hes tenure, there was a steady trend downward.  And after he left, the ratings have gone up. 

So, I mean, there—there are probably some people out there that would want to watch it.  But I somehow suspect that they‘re not out buying HDTVs. 

CARLSON:  All right.  Well, I guess we‘ll get a chance to see. 

Matthew Sheffield, thanks a lot for joining us. 

SHEFFIELD:  A pleasure.

CARLSON:  Dan Rather also has his defenders.  My next guest is a fan, but he‘s got some advice for the veteran newsman as well.  Advice that could be summed up in just four words: take the high road. 

Joining me now, Jon Friedman, senior columnist from MarketWatch in New York. 

Jon, thanks for coming on. 

Thank you. 

CARLSON:  Shouldn‘t Rather admit that that story was phony?  I mean, whatever you think of Dan Rather and his politics, I think you‘ve got to be offended by what CBS News did with that story. 

Why can‘t he just admit it was false? 

JON FRIEDMAN, MARKETWATCH:  I think he did.  I think he basically said he regretted the story, he was sorry it was aired, and he must move on from there.  I think it‘s going a little too far sometimes with this criticism of Dan Rather. 

CARLSON:  Yes.  I mean, OK.  People can—I think you‘re probably right, people can beat up on him too much.  But on the other hand, don‘t you think it‘s a bit much of him to get up there as he did yesterday and paint himself as a victim of a right wing witch hunt when he screwed up, he committed sloppy journalism for which you, by the way, would be canned and I would be canned?  And he wasn‘t canned right away. 

FRIEDMAN:  Well, it‘s Dan being Dan, right?  I mean, that‘s the way he is.  He‘s theatrical, he‘s a martyr, like you said before.  He‘s all these things.  This is why people respond to him, pro or con. 

CARLSON:  But, I mean, doesn‘t he also just confuse the hell out of people?  What‘s the courage thing?  What does that mean? 

FRIEDMAN:  I don‘t know.  That was kind of strange, too.  Courage was a very strange (INAUDIBLE) those years. 

CARLSON:  But, I mean, did it have any meaning?  And what did the network brass say when he, you know, in the editorial meeting said, well, I think I would like to end the newscast tonight by staring into the camera like a crazed man and saying “Courage”? 

Do you suppose anybody...

FRIEDMAN:  Well, he was there for 24 years before he was tossed out.

CARLSON:  Yes.

FRIEDMAN:  That‘s pretty good.  Twenty-four years is a good record. 

CARLSON:  Actually—well, that‘s my second question.  Dan Rather is 74 years old, he‘s rich, he can do whatever he wants.  You know, he can join some foundation and, I don‘t know, go wherever he wants or do whatever he wants. 

FRIEDMAN:  So can we.

CARLSON:  Why does he want to be—why does he have to be on television at 74 years old?

FRIEDMAN:  He loves—he loves the life, obviously.  He loves the life of being on television, of talking to people.  He‘s hooked on it, it‘s like a drug for him.  He can‘t turn away. 

CARLSON:  But think of it this—I mean, he would go door to door if television didn‘t exist. 

FRIEDMAN:  Probably. 

CARLSON:  But think of it—think of it this way.  OK.  So, he‘s 74. 

How many 74-year-old heroin addicts are there?  Not all very many, right? 

Probably next to none.

FRIEDMAN:  I‘ll give you that.

CARLSON:  And yet he‘s addicted to television.  I mean, how much more addictive is it then? 

FRIEDMAN:  He loves—he loves being on TV, he loves talking to people, he loves being powerful and rich and famous, and important.  That‘s all there is to it. 

CARLSON:  Is he going to be any of those things on HDNet? 

FRIEDMAN:  I think he‘s got more of a chance than what he was doing before on the sidelines, doing nothing at CBS, earning a paycheck, sure. 

CARLSON:  So your position is that the guy is just compelling television and that‘s why you support him? 

FRIEDMAN:  Absolutely.  I support him.  I think he did a good job for a long time, too.  I did like his work on CBS.  And I think he‘s an important journalist.  That‘s why I supported him. 

CARLSON:  Boy, I have to say, he is amazing to watch.  Do you think it‘s possible that one day he just goes completely bananas on the air and just explodes?  His head explodes or he starts screaming on the air, crying? 

FRIEDMAN:  Let‘s hope.  Let‘s hope.  Great TV right there, huh? 

CARLSON:  Yes. 

I like the way you analyze television. 

John Friedman, thank you for joining us. 

FRIEDMAN:  Thank you.

CARLSON:  Still to come, good news from the GOP.  Dennis Hastert—he‘s the speaker of the House—says we‘re winning in Iraq.  If that‘s news to you, stay tuned to hear him explain. 

And do prisoners have a right to porn behind bars?  The ACLU says of course they do.  We‘ll tell you how they‘re stepping up to protect inmates‘ porn rights in just a minute. 

(COMMERCIAL BREAK)

CARLSON:  Still to come, a report from the Department of Homeland Security lists petting zoos and flea markets as top Al Qaeda terror targets.  Feel more secure?

Plus, good news.  We‘re winning the war in Iraq.  That‘s what the Republican speaker of the house declared today.  You‘ll hear his logic in just a moment.  But right now, here‘s a look at your headlines.

(STOCK MARKET UPDATE)

CARLSON:  Time now to take a quick look at the people and stories making news today.  Everyone who claimed the war in Iraq was conceived to help Halliburton can just take a deep breath and get on with their lives, now.  The U.S. Army has discontinued its multibillion dollar contract with the oil services giant once headed by Dick Cheney. 

The Pentagon will split Halliburton‘s work between three other companies. You know, it‘s easy to laugh at the Halliburton conspiracy.  I know a lot of them well; I worked with some once upon a time.  But actually, they hurt this country. 

Rather than debate the war in Iraq at its core—why are we going, can we win, should the president get the power to take the country to war without the Democrats‘ support, all important questions that ought to have been debated, the Democrats wasted their time with these ludicrous and, in the end, untrue Halliburton conspiracy theories.  It was pathetic. 

Well, what will go down as a historic moment in the annals of self-delusion, House Speaker Dennis Hastert declared today that the Republican party will increase its majority in the fall‘s midterm elections.  That‘s right, increase.  Not that they‘re not going to lose the House and Senate.  They‘re going to get more seats.  Why?  Because the Iraq war is going so well.  OK. 

(BEGIN VIDEO CLIP)

REP. DENNIS HASTERT (R-IL), SPEAKER OF THE HOUSE:  We have a good story to tell.  We‘re winning in Iraq.  We are standing up Iraqi armies and Iraqi defense police forces.  And as we do that, we‘ll begin to bring our own people home.  That‘s our design. 

(END VIDEO CLIP)

CARLSON:  Save the tape.  It‘s July 12, 2006.  Ten years from now, look at that tape.  We will know whether the speaker of the house is insane or the living embodiment of Nostradamus.  Brilliant, a genius, enlightened, touched by God.

If is Iraq is threatening South Korea for its GDP, if it‘s more affluent than Belgium, then this man will be he renowned as a seer.  But I don‘t think that‘s going to happen, sadly. 

Is the FBI threatening to take away the green cards of Muslims who refuse to serve as informants?  That is the charge being made by some Muslims who say the government‘s aggressive pursuit of information about their community has led the FBI to give some people a choice; spy on your friends or risk deportation from the country. 

Well, of course, it all depends on who your friends are.  If they‘re people who might be plotting terror attacks, good for the FBI, I say.  Just when you think the government doesn‘t do anything right, finally, a clever strategy to fight terror at its source, among people who are most likely to commit it, which is radical Muslims.  Sorry, it‘s true. 

When you think about of the state with the most potential terror targets, New York probably jumps to mind immediately.  New York City, after all, was the target of the worst terror attack in our country‘s history.  But when the Department of Homeland Security thinks about terror, it thinks Indiana. 

A recent DHS report listed the Hoosier State as the most target-rich place in this nation.  Among the targets Homeland Security would have you Osama bin Laden is eyeing?  Old McDonald‘s petting zoo, the Amish Country Popcorn Factory, the Mule Day Parade, the Sweetwater Flea Market, and Wal-Mart stores in general. 

I‘m joined now by a man who thinks the Statue of Liberty is slightly more at risk than the Amish Popcorn Factor.  He is former NYPD detective and current security consultant, Bo Dietl. 

Bo, thanks for joining us.

BO DIETL, FORMER NYPD DETECTIVE:  Hey, Tucker.  How are you doing? 

CARLSON:  I‘m doing great.  Now, in all your years, fighting bad guys.  Indiana, was that, in the law enforcement community, widely recognized as a hotbed of potential terror attacks?

DIETL:  No, I don‘t think so.  I mean, you know, we have Congressman King, the head of the Homeland Security with the United States Congress.  And he‘s fighting to get us funds. 

And then all of a sudden, you‘ve got Chertoff, who came from New Jersey, was a U.S. attorney over there, and for some reason, he doesn‘t recognize the fact we were targeted back in 1993, when the nephew of Yousef -- that was the nephew of Mohammad Atta, who was the mastermind of the real successful attack on the World Trade Center in 2001.

I mean, this was the same thing happening, and the most important thing we have to realize?  We were, and we are, and we always will be the main target of an attack, is New York City. 

CARLSON:  Well, wait, wait, wait, wait.  Not according to the federal government.  I mean, New York, for instance, has, according to the federal government, their official database, 5,687 potential terror targets.  Indiana, meanwhile, has 8,591.  So it makes sense that Indiana would be getting scrutiny and funds that New York isn‘t getting, don‘t you think? 

DIETL:  You know, they have had dozens of plots against New York City.  We had plots against the subway system.  These plots have been broken over the last couple of years since 9/11.  And people have to realize, when you have these plots coming to fruition, these are the ones we know about.  We‘re not talking about the ones we don‘t know about today. 

And if you think, for any reason, that they‘re not going to try to come back and hurt us again, New York City, then you‘ve got to be smoking crack.  And any of these politicians who don‘t want to give us money in New York—you‘ve got the New York City Police Department, headed up by Ray Kelly.  You have an intelligence division that has intelligence sourcing now that they are going undercover, and they‘re getting information before these things occur. 

CARLSON:  Are at the going under cover in mosques?  I mean, the question that no one wants to address in public is, what should we do about Muslims in the United States? 

DIETL:  Well, you know what?  Everyone‘s worrying about our freedom and our rights.  I love my freedom, I love my rights.  But the fact of the matter is, where the people that are going to hurt us are hiding are in Muslim communities. 

I have nothing against Muslim people.  But you have Muslim fanatics that want to kill us.  In the Muslim community, of all the hijackers that came and that bombed on 9/11, all of them were in this country illegally.  The problem here is, we have people that are in our country. 

We have to be able to go out to the Muslim communities.  We have to be able to identify people.  And if they don‘t have their right identification, we should ship them out. 

Then we have to tighten up our borders.  You know, we have security technology right now where law enforcement people can go up to somebody, put their palm print, and know if that person is legally here or not.  And if they‘re not legally here, we‘ve got to ship them out before they start to develop—we‘ve to get the cancer out of this country. 

CARLSON:  Well, sure.  But that‘s your solution.  I want to read to you a little more of the federal government‘s solution.  I want to read you a list of potential terror sites.  These are places the federal government believes Al Qaeda may have be eyeing, even as we speak, even right now, Bo Dietl.

They are places such as Nick‘s Check Cashing, mall at Sears, ice cream parlor, a tackle shop, a doughnut shop, the Humane Society, the Beanfest.  Even the Apple and Pork Festival in Clinton, Illinois.  And I‘m wondering if a radical Muslim wouldn‘t be offended by a Pork Festival.  Pork, of course, being verboten to Muslims.  What do you think of that?

DIETL:  You know, Tucker?  It‘s not humorous to me.  I was down there on 9/11 when the buildings came down.  And I spent the whole night down there.  And you know what?  People become complacent; they forget about it. 

We are the target in New York City.  We need the protection.  We need the protection in the subway systems; we need the intelligence.  With intelligence is going to be how we could stop and avert the next attack that occurs in New York.  It‘s not going to be if it‘s going to happen.  It‘s going to happen; it‘s going to happen in New York, some shape or form. 

CARLSON:  Wait, wait.  Sum it up for me.  Everyone agrees with you that New York, obviously, ought to get more funds than the state of Indiana.  Obviously.  However, is New York under funded?  I mean, does New York not have enough money to fight terror? 

DIETL:  Well, if you feel as though this is the main target, and every conspiracy and every attack plan is against something in New York—I mean, we don‘t have to be rocket scientists to realize this is the target for the terrorists.  Because it‘s going to make the most impact when you attack something in New York. 

Not in Omaha, Nebraska, where my friend Warren Buffett lives.  No one really cares about Omaha, Nebraska.  I care about where the potential target is, and that‘s in New York.  When you have so much of a population here—and New York is the international capital of the world, and that‘s where they‘re going to hit us. 

So what we have to do is we have to get the lawmakers to change the funding, get Chertoff to wake up, have a little coffee, and realize we have to get more money earmarked for intelligence so we can avert the next attack on New York. 

CARLSON:  I have a feeling New York City will get it.  Just a guess.

Bo Dietl from New York.  Thanks. 

DIETL:  Thank you, Tucker.

CARLSON:  As we mentioned earlier, Columnist Bob Novak has broken his silence and confirmed what most everyone in Washington already knew.  Presidential aide Karl Rove, along with a CIA spokesman were indeed two of the three sources in the outing of CIA operative Valerie Plame. 

Novak‘s admission still leaves many Americans speculating about his third source.  We do, after all, love a good mystery.  So in today‘s top five, we take a peek at some of the nation‘s best kept secrets.  It‘s for your eyes only. 

(BEGIN VIDEOTAPE)

If you think some of the world‘s best kept secrets are confined to the inner sanctums of Foggy Bottom, think again.  A warning, however.  After disclosing coming of the following information, we may have to kill you have. 

RICHARD NIXON, FORMER PRESIDENT OF THE UNITED STATES:  I shall resign the presidency, effective at noon tomorrow. 

CARLSON:  He helped topple the presidency of Richard Nixon.  But few Americans knew his true identity.  This political whodunit lasted more than 30 years, until last year, when at the age of 91, former FBI official Mark Felt finally stepped forward and conceded he was of the guy they called Deep Throat. 

CARLY SIMON, MUSICIAN:  You‘re so vain.  I‘ll bet you think this song is about you.

CARLSON:  So who exactly is the self-absorbed mystery man Carly Simon mocks in her 1972 hit, “You‘re So Vain”?  Some have speculated it‘s one-time movie hunk Warren Beaty.  Elvis perhaps?  Maybe ex-husband James Taylor?  Or could it be Mark Felt himself?  After nearly 35 years, Simon says nothing. 

The truth is out there, but don‘t expect the Pentagon to reveal what really goes on within that remote stretch of Nevada known as Area 51.  Officially, it‘s just a government installation for testing secret military aircraft.  Conspiracy buffs, though, remain convinced its true purpose is a little more alien in nature than that. 

UNIDENTIFIED MALE:  There‘s a lot more out there than most people realize. 

CARLSON:  Since Coca Cola‘s inception in 1884, the world has thirsted for the knowledge of what makes the soda the real thing.  Insiders call it 7X, but won‘t say exactly what that mean.  In fact, Coke‘s secret ingredient is one of corporate America‘s most closely held trade secrets, known only to a few employees. 

UNIDENTIFIED MALE:  Some of this information is as important to its holders, in this case, the Coca Cola company, as classified information is to the government. 

CARLSON:  He‘s not a real secret agent, but he plays one in the movies.  And like his bring screen alter ego, Tom Cruise apparently has a knack for impossible missions, missions like keeping his 3-month-old daughter Suri away from the paparazzi‘s prying eyes. 

UNIDENTIFIED MALE:  We haven‘t even seen a picture of Katie Holmes carrying Suri in a blanket or them trying to hide from photographers with the baby.  We‘ve seen nothing. 

CARLSON:  Is this one of the biggest Hollywood mysteries since whatever happened to Baby Jane?  Or could baby Suri be, as some conspiracy theorists have suggested, Tom Cruise‘s greatest publicity stunt? 

TOM CRUISE, ACTOR:  You don‘t know, and I do. 

(END VIDEOTAPE)

CARLSON:  Coming up, on yesterday‘s show, I offered a guest $1,000 if he would walk a mile outside the green zone in Baghdad and live to tell about it.  Well, someone has taken me up on that offer. 

Plus, remember the good old days when you could fire up a cigarette on an airplane and blow the smoke at the guy wedged into the seat next to you?  Well, those days may soon be here again.  We‘ll explain when we come right back.

(COMMERCIAL BREAK)

CARLSON:  Welcome back.  Time for voicemails, where we ask you to supply the content of an entire segment.  And we oblige every day.  First up...

BILL IN ALEXANDRIA, VIRGINIA:  Bill in Alexandria, Virginia.  I‘ve been seeing that crack from the University of Wisconsin.  If he actually believes our government conspired to kill 3,000 of its own citizens, why is he still in the country, paying his tax dollars to a government that killed its own citizens?  It makes him complicit.

CARLSON:  That is a point, Bill, that I have made on this show a number of times.  I don‘t think you can make that point enough.  I think it‘s an excellent point.  If you think our government killed 3,000 of its own citizens—or is even capable of killing 3,000 of its own citizens—then you shouldn‘t be in this country.  You are, as you put it, again, complicit in that crime. 

America-hater after America-hater sits within the safety and comfort of America and throws darts at this country.  If they had the courage of their convictions, you know, they would move to another country and do it from there.  But they don‘t want to because the water‘s better here.  Next up.

SUE IN RENO, NEVADA:  Sue in Reno, Nevada.  Thank you.  Finally someone is questioning why pay all that humanitarian aid in Iraq to a country of people that hates us.

CARLSON:  And that aid won‘t buy us love, either.  America gives more in aid than any other country—any other country on the planet or in the history of the planet.  And do we get anything in return?  If, by anything, the measure is affection, do people like us more because we give them stuff?  No.  They like us less.  They have contempt for us. 

Our rule ought to be, if you don‘t like us, if you have contempt for our way of life, and certainly if you‘re trying to kill us, you get from us nothing.  We reward our friends and punish our enemies.  We a lot ought more like Israel in that way, in my view.  Next up.

JIM IN TAMPA, FLORIDA:  Jim Bailey, Tampa, Florida, here.  You said during the Einstein story that you were not passing judgment, but that was sick.  What‘s wrong with passing judgment?  I think we have too much non-passing judgment in today‘s society. 

CARLSON:  Well, Jim, just to remind our viewers who possibly weren‘t watching yesterday, here‘s the context.  Letters surfaced from Albert Einstein written before he died, of course, but held for 20 years in trust, just released yesterday, that indicated he wrote letters to his then-wife, telling her about his extramarital affairs. 

I said facetiously on the show, “I‘m not judging, but that‘s sick.” 

But you know what?  I‘ll let you in on a little secret.  I was judging. 

Deep down, I was judging.  Next up.

ROBERT IN PITTSBURGH, PENNSYLVANIA:  Robert from Pittsburgh, Pennsylvania.  I think the real reason that Zidane head butted that Italian player during the World Cup final was because it was at that very moment he finally realized he was French, and he didn‘t know how to handle such a horrible realization.  I mean, I don‘t know if I could either.

CARLSON:  So that‘s what the French do?  It‘s sort of like the old joke about the scorpion.  Why did the scorpion sting?  Because he‘s a scorpion.  He can‘t help himself?  I don‘t think that‘s fair.  Not all French head butt.  I know a lot of them, and not all of them head butt.  Next up. 

BETHANY IN LOS ANGELES, CALIFORNIA:  Bethany from Los Angeles, California.  I was going to take the Tucker Carlson challenge and go to Baghdad and walk around for a mile in exchange for $1,000.  I would probably be raped, killed, and subsequently set on fire.  So I decided to get drunk and belligerent and continue watching your show. 

CARLSON:  Thank you, Bethany.  Let me just call into question one thing you said.  You wouldn‘t probably have those things happen to you.  You definitely would have those things happen to you.  But my challenge to Brad Blakeman remains open and on the table.  Baghdad‘s a great place.  It‘s becoming Belgium on the Tigris.  That‘s great.  You walk a mile in it without military guard, you survive, you get $1,000 from me.  So I look forward to him fulfilling that bet.

Keep the calls coming on anything and everything.  The number, again, 1-877-TCARLSON.  That‘s 1-877-822-7576.  You can also send any video clips featuring your opinions to Tucker.MSNBC.com.  We‘ll use those as well.  Again, if you‘ve got interesting video, send it to us.  We dare you. 

Still ahead, there‘s one sure-fire wave not to get out of a traffic ticket; backing into a police car.  We‘ll tell you what this driver was thinking when we come right back.

(COMMERCIAL BREAK) 

CARLSON:  Welcome back.  Time now for the cutting room floor, and that, of course, means the great Willie Geist, who has spent all day sweeping up the best stories in the nation.  They‘re prepared. 

WILLIE GEIST, MSNBC PRODUCER:  I have, Tucker.  How are you today, man? 

CARLSON:  Great.

GEIST:  Good.  I‘ve got a couple quick things out of the gate, here.  We want to wish a very happy birthday to a friend of this show, Mr. Richard Simmons.  There he is on our show a couple months ago.  I won‘t even give out his age.  Word is that he is on a competing cable network today wearing a purple suit.  We‘re going to look into that and get back to you tomorrow. 

CARLSON:  I have no doubt he‘ll be wearing his beloved dolphin running shorts, which he gets on E-bay, and his handmade sequin tank top. 

GEIST:  A note, here.  That interview was in February, and he was wearing a tank top and dolphin shorts. 

CARLSON:  I guess. And our viewers ought to know, he walked dressed that way through the snow to his waiting limosine. 

GEIST:  No jacket.  Exactly.  And one other note, some bad news, another friend of this show, the great Joey Buttafuoco, will be going to the slammer on November 1st for violating probation.  He was found possessing ammunition, which apparently you can‘t do if you‘re a convicted felon.  So, Joey, we‘ll see you in about a year and a half. 

CARLSON:  He‘s a martyr for love, Willie. 

Well, it‘s hard to believe it really wasn‘t that long ago you could still smoke cigarettes on airplanes.  Well, a new airline is seizing on that nostalgia for those times by making itself the first airline for cigarette smokers.  Smintair—short for Smoker‘s International Airways—will encourage cigarette and cigar smoking on its flights.  The airlines founder says the idea that secondhand smoke is harmful is, quote, “one of the biggest lies in the world.” 

GEIST:  Yes, Tucker.  These guys are aggressively pro-smoking.  The founder of the airline has this whole essay on the Web site.  It‘s just about the romance of smoking and harkening back to a time when we all smoked and how much better life was.

So you‘d better be serious about smoking if you fly on this airline.  But I have a feeling you might join this airline because—not many people know, Tucker Carlson, when he checks into a hotel, he doesn‘t smoke, but he requests a smoking room to keep smoking rooms alive. 

CARLSON:  That is true, that is true.  I don‘t smoke.  I quit.  And I‘m against smoking.  It‘s bad for you.  People have gotten sick from it.  On the other hand, I have a lot of sympathy for people who smoke cigarettes.  And they‘re very physically uncomfortable a lot of the time.  And I think we ought to let them smoke.  It‘s their business.

GEIST:  Fly Smintair.

CARLSON:  Exactly.

Well, backing into the squad car isn‘t going to win you a lot of points with the police officer who has just pulled you over on suspicion of drunk driving.  That‘s what this Texas woman learned the other night, among other things.  The dashboard camera in the car of a Frisco, Texas, cop, caught the sauced up woman stopping, initially, and then backing up when the cop got out of his car. 

GEIST:  Tucker, she‘s wrong; this is bad.  But, in her defense, when you‘ve had a few cocktails, the P for park and the R for reverse look awfully similar.  So I‘m going to give her a little slack. 

CARLSON:  You‘re a compassionate man, Willie.

GEIST:  Yes, I‘ve got a big heart. 

CARLSON:  Well, today was the sixth day of the running of the bulls in Pamplona, Spain.  And, of course, someone was injured during the Darwinian exercise.  A 55-year-old Spanish man was hospitalized with injuries to his head and back after he was tossed by one of the bulls.  If you haven‘t yet run this year, there are still two more days to get trampled and gored, possibly to death. 

GEIST:  Tucker, I‘ve never participated in this exercise.  It actually looks kind of fun.  But it seems to me the key to success and survival is cowardice.  Throw your friends and family in front of the bull.  You live, you survive, you live to see another day. 

CARLSON:  That‘s why it‘s literally Darwinian. 

GEIST:  Exactly. 

CARLSON:  It‘s a tough world out there. 

Well, you can take away a man‘s freedom and his dignity, but you‘d better not take away his porn.  That‘s the message being sent by a group of inmates in Indiana who are suing the Department of Corrections to overturn a policy that bans pornographic magazines. 

The class action suit claims that the policy bans not only publications such as “Playboy” and “Hustler,” but anything that contains nudity or sexual content.  That includes “National Geographic” or those motorcycle magazine with chicks in bikinis.

GEIST:  OK, Tucker.  But this one on the ACLU‘s greatest hits.  They say the corrections policy, this policy, includes prohibitions of much of the world‘s great literature and art.  I‘m so sure that‘s what the inmates are looking for.  If, by great literature, you mean “Swank” magazine.

CARLSON:  If you mean “Easy Rider,” which I actually think is a pretty good magazine.  I‘m on the inmates side.  Willie Geist.  Thanks, Willie.

That‘s it for us.  Thank you very much for watching.  Up next, “HARDBALL” with Chris Matthews.

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

END   

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