updated 7/20/2006 3:07:33 PM ET 2006-07-20T19:07:33

Guests: Shimon Peres, Scott Wilson, Andrew Lee Butters, Trent Lott

CHRIS MATTHEWS, MSNBC ANCHOR:  Nuclear weapons and Hezbollah rockets. 

A top Israeli official reminds HARDBALL today that last week‘s Hezbollah attack on Israel came just 24 hours after its sponsor, Iran, rejected calls to stop its nuclear weapons drive.  Is the war we‘re watching now a warning of a far scarier one?  Let‘s play HARDBALL.

Good evening, I‘m Chris Matthews.  Welcome to HARDBALL.  Tonight from San Francisco on this the eighth day of the Mideast crisis, fighting has intensified as the death toll rises in Lebanon and in Israel.  Israeli warplanes today targeted, pounded Lebanon as people desperately tried to escape the war zone by land, by sea and by air.  One thousand Americans boarded a cruise ship in the first massive evacuation since the fighting began, many wondering why it took so long.  The militant Hezbollah group launched rockets into Nazareth, killing two children, while others fell on the city of have Haifa. 

Meanwhile Israeli troops crossed the border into Lebanon to attack Hezbollah posts there.  We‘ll talk to Israeli Deputy Prime Minister Shimon Peres, who tells me tonight that Iran‘s refusal to give up its nuclear program is directly related to this latest round of Hezbollah attacks.  We now know the crisis started, of course, with the kidnapping of two Israeli soldiers.  What we don‘t know tonight is how it will end.  HARDBALL has the region covered, with live reports from our NBC correspondents and all the news out of Washington today, including President Bush‘s veto of stem cell legislation, the first veto of the Bush presidency.  Right now we go to the Middle East and we begin with NBC‘s Mark Potter, who spent the day reporting if Nazareth and is now in Haifa.  Mark, tell us what happened in Nazareth today? 

MARK POTTER, NBC NEWS CORRESPONDENT:  Well, Chris, we just returned from historic Nazareth with its 70,000 residents.  It‘s home to the largest Arab community in Israel and there we witnessed a very somber scene tonight just about an hour or so ago.  Hundreds of people gathering outside a mosque for the funeral of two children killed today, Israeli Arab children killed today in a Hezbollah rocket attack.  Neighbors say that the two brothers were visiting their uncle and were playing on a narrow street, a hilly street between two apartment buildings when the rocket fell, killing both of them.  Many other people were also injured. 

And you can see as we were there just a short time ago, that crater still on the side of the road, windows blown out.  The walls pocked by the shrapnel.  This is one of four rockets to hit in that area today, on a day with 140 rockets, estimated, fell throughout northern Israel.  The most since the attacks between Israel and Hezbollah back and forth began last week. 

The irony of this fatal attack in Nazareth today is obvious.  Hezbollah rocket killing Arab children and adding to that irony, Chris, is the fact that many of the people that we talked to placed most of the blame on the Israeli government.  Saying that they didn‘t provide bomb shelters and working air raid sirens, they also blamed the Israeli government for ratcheting up the conflict with Hezbollah.  And of course, and sadly, caught in the middle of all that, were two small children today, just playing in the street.  Chris? 

MATTHEWS:  You mean when your brothers shoot you, you blame the police for not showing up fast enough? 

POTTER:  That‘s the argument we were hearing today. 

MATTHEWS:  Is your sense covering that region that the Israeli-Arabs feel more closer to other Arabs than they do to the Israeli government or are they caught in the middle? 

POTTER:  Caught in the middle, but the scene that we saw there in Nazareth surprised us a little bit.  We had read going in some wire accounts that that was the feeling, but we did clearly run in to that.  One man we talked to today said that this is the Israeli government‘s fault and when another family we talked to, we asked the same question, who is to blame, they didn‘t want to say anything at all, they felt very uncomfortable, so that sort of probably underscores both issues, caught in the middle and maybe siding with the Arab side in this, and again, caught very much in the middle today. 

MATTHEWS:  Let me ask you about coming back to Haifa, a huge city, number two city, actually number three city in Israel.  A very modern city, very much familiar to most of us in the west, it seems like home, dare I say it, many when I‘m over there.  Is the city now depopulated because of these rocket attacks? 

POTTER:  It‘s best to describe it as a ghost town.  If you know this town, you know that there are a lot of people here, a lot of traffic.  You‘d be surprised, Chris, if you came back now.  There are very few people on the roads, many people have left the area.  Our cab driver who took us to Nazareth said that he had taken people out to Tel Aviv and points south for safety. 

Even the ships in the port behind me have left, they‘ve gone down to the Tel Aviv area to get out of the area.  The port is closed.  Businesses are closed.  This town is feeling the effects of these rockets.  I witnessed two rocket attacks today, one this morning, a burst of rockets hitting, most of them hitting the water, but some hitting harmlessly on land.  We had another attack tonight.  Neither of those attacks by the way were preceded by sirens, so these things can just fall out of the sky, people know that and now most people are either staying away or staying indoors. 

MATTHEWS:  You know Mark, your report is so interesting today, in the horror today of Arab rockets hitting Arabs because I always thought that one thing protecting Israel from an Arab nuclear attack was the knowledge if you kill a lot of Jewish people, you‘ll kill a lot of Arab people and I thought that might stop them, but apparently it isn‘t stopping Hezbollah.  Thank you very much NBC‘s Mark Potter in Haifa. 

Let‘s get to the latest from Jerusalem.  The “Washington Post‘s” Scott Wilson joins us now by phone.  Scott, what are the Israeli demands as of today?  Is it just the soldiers back?  Is it a stopping of the rocket attacks or are they interested in a more thorough going solution here? 

SCOTT WILSON, “THE WASHINGTON POST”:  It‘s the two things that you mentioned, Chris, plus it‘s a disarmament of Hezbollah, according to U.N.  resolution 1559, which was approved by the Security Council last year following a Rafik Hariri‘s assassination in Beirut.  And a deployment of the Lebanese army in south Lebanon.  I mean, those are two very big demands, not to mention the immediate release of the captured soldiers.  It‘s fair to say that these are demands that are just not going to be met any time soon. 

MATTHEWS:  Here‘s where I‘m a little bit skeptical of the demands.  We have Shimon Peres coming up, we taped him a few hours ago and it‘s great stuff because he talks about the demands that Israel is making right now.  But why would Israel trust the Lebanese army to replace, much less take on Hezbollah? 

WILSON:  It‘s a good question.  I think pressed, the Israeli government will tell you we know that the Lebanese army cannot take on this job.  I mean, they‘ve never deployed in south Lebanon.  You‘ll recall when Israel occupied south Lebanon for 18 years, it was Hezbollah that was fighting Israel, it was never the Lebanese army.  The Lebanese army does have components that are Christian however, and the Christians have worked in the past with Israel in Lebanon.  Israel installed essentially a Christian president there in the early 1980‘s who was later assassinated by Syria, so there‘s some affinity there.  But, this is not really what it‘s about.  What it‘s about is about disarming Hezbollah, getting Hezbollah out of the south and weakening the movement once and for all. 

MATTHEWS:  So is Israel doing the dirty work itself?  It basically doesn‘t believe that any third party, like the Lebanese government, can control the negative potential of Hezbollah. 

WILSON:  I think that‘s very true, and you mentioned in the introduction, you know, we are, when we say Hezbollah, you know, Israel is also talking about Iran.  That the raid, the cross-border raid that captured these soldiers, occurred around the time when the United States, European Union and others were awaiting Iran‘s response about direct talks over its nuclear program.  Iran showing its hand in the region to some degree as well. 

MATTHEWS:  What do you make of that connection, which we‘ll see in a couple minutes, drawn by Vice Prime Minister Shimon Peres, that on one day, the 11th of July, the talks broke down, Iran said no to the world powers, we‘re going to keep going with our program and the very next day, Hezbollah attacked across the border into Israel? 

WILSON:  I think that, you know, they make a very persuasive argument that the two are connected.  Iran is very, I mean, the whole reason for Iran‘s support for Hezbollah is to project its presence, its influence in a volatile region, for just these kinds of times.  To show leverage at times when it is feeling pressure.  The United States obviously worries about Iranian pressure in Iraq, it‘s showing that it has pressure in farther to the west, where we are, and so I think there‘s a persuasive argument to be made that some of these messages and signals are being timed to strengthen Iran‘s position regarding its nuclear program. 

MATTHEWS:  Thank you very much Scott Wilson of the “Washington Post” who‘s on the phone from Jerusalem.  Earlier today I spoke with former Israeli Prime Minister and currently the Vice Prime Minister of Israel, Shimon Peres.  Mr. Vice Prime Minister, yesterday on the program, you told us that Israel would not engage in ground troop action on the Lebanese side of the border.  Now we have a new report from the “New York Times” and the “Associated Press” of a skirmish involving the I.D.F. on the Lebanese side.  Is there a change in tactic or what‘s going on now? 

SHIMON PERES, ISRAELI DEPUTY PRIME MINISTER:  No, we don‘t have the slightest intention to base ourselves again in Lebanon, on the Lebanese land.  What we are trying to do is to prevent the Hezbollah from coming back to the border of Israel and deploying their forces in the way of ambushes.  That‘s what they are doing. And we are waiting that the Lebanese will deploy itself along the border, instead of the Hezbollah, in accordance with United Nations resolution.

MATTHEWS:  Do you have confidence in the Lebanese army to provide a buffer between your country and Hezbollah?

PERES:  No, they won‘t be a buffer, but they will replace Hezbollah.  We don‘t have the slightest trust in Hezbollah.  They converted the border as a train of ambushes, shootings, trying to hijack our people.  And we don‘t want them there.  That‘s also the view of the United Nations.

But the Lebanese army should decide if they are an army.  They have 50,000 soldiers.  The Hezbollah is six or 7,000 soldiers.  Now it‘s not the Salvation Army.  It must be a fighting army—if they want to have an independent Lebanon, only the Lebanese army can provide them with independence.  Otherwise, Hezbollah conquers Lebanon in fact.

They don‘t serve the Lebanese interests.  They take orders and missiles from Iran, and they serve the Iranians.  It‘s a foreign body.  It‘s an army within an army.  And they should bring an end to it.

MATTHEWS:  Do you see any stiffening of the Lebanese government, a resolve that they hadn‘t had before, to truly be a government over all the territory of Lebanon?

PERES:  Not really.  I mean, they find it comfortable to declare their weakness.  But governments must govern, must defend themselves.  Look, the Lebanese came to us and say, “Land for peace.”  We gave back all the land.  We didn‘t get a piece of peace, you know?  All the time.

MATTHEWS:  Is there a way for Israel, unilaterally, to do the job? 

Can you, using your fine air force, destroy Hezbollah‘s striking power?

PERES:  That‘s what we shall try to do.  At war, there is no alternative but victory.  We don‘t fight the Lebanese.  We are very careful not to hit their infrastructure, and clearly, not to hit their people. 

Unfortunately, the Hezbollah has hidden some of their missiles in private homes.  And we are telling those persons, gentlemen, “Either you get rid of the missiles or leave your home.  But we shall not wait until you will fire the missile over our heads.” 

You know, in four or five days, we have had 1,500 missiles, day and night, over the skies of the schools, over the restaurants of Israel.  We‘ve behaved with restraint—I hear that some people say its “disproportionate.”  Is it proportionate to have 1,500 missiles in five days, and God knows what for?  What do they want to achieve? 

They are fanatics.  They serve the Iranians.  They destroy Lebanon.  And the prime minister of Lebanon should address himself to them, not to us.  We have nothing to ask of Lebanon.  We would like to live in peace with Lebanon.  We‘d like to see an independent, prosperous Lebanon, multinational, multi-religious.  They‘re an excellent candidate to be a good neighbor.

MATTHEWS:  What can the United States government do to push the government of Lebanon to accept its responsibilities to govern its entire territories?  How can Americans encourage them to be stronger?

PERES:  Well, let me first of all say the following.  We appreciate very much the position taken by the Americans—the administration, the Congress, the people.  Your support is very dear to us, spiritually.  And, you know, the right spirit is a very strong weapon as well. 

We know that we have to do the fighting.  We have never asked in our history an American soldier to fight instead of us.  We are small, but we are determined.  We are united, and we shall do the job. 

The problem of the United States, in my judgment, was two-fold.  One, you‘re engaged in many fronts:  in Iraq, in Afghanistan, in North Korea.  In Iran, all those evil groups raise their heads.  That‘s one thing. And Americans and President Bush took a very clear position.  But, alas, he found the world divided.

The world division created the Iranians strength.  I assure you, the minute there will be a unified position by the world, Iran will return to little strength which is rather weak.  If I read correctly the map, the president is trying to create a coalition with a united policy vis-a-vis Iran.  Iran is the masterminding force, here.

MATTHEWS:  Yes, what is the connection between America—our concern

Israel‘s concern—about a nuclear capacity, a nuclear weapons capacity by Iran, and this attack of Hezbollah?  Are they trying to divert world attention from their nuclear program?  Or what are they up to, do you think?

PERES:  It may be the case because the refusal, or the negative answer of Iran was given on the 11th of July and the attack of the Hezbollah started on the 12th of July.  So the proximity in time maybe tells the story.  They are serving the Iranians.  And the Iranians think that the world will remain divided, and they can make a mockery of it. 

They don‘t give a damn about world public opinion or institutions.  But the minute they will understand that there is a responsible world—and Iran is a problem for the world because, if Iran will have nuclear bombs, it will eventually reach the hands of terrorists, as well, as their missiles are going over to terrorist hands.  And then how are we going to govern the world? 

I mean, if North Korea, Iran, and if the two of them will do, other countries will follow suit.  They don‘t have a choice.  Everybody who is fanatic or has money or has a conflict or has a claim will have a nuclear bomb, it will be impossible to run the world in a normal way.  For that reason, I think Iran is the world‘s problem. 

I hope the world will unite itself and take the necessary position vis-a-vis Iran.  In the meantime, we shall fight against the envoys of Iran here, and we shall win.  It‘s costly, it‘s painful, but we don‘t have a choice.  And we feel we do the right thing, deeply convinced, and deeply anxious to have peace. 

MATTHEWS:  One last question, Mr. Peres.  Condi Rice, the secretary of State—is she coming to the region?

PERES:  That‘s what I read in the papers, but she will always be welcome.  We have the highest respect for her, as I have said, and I repeat it, we have the highest respect and thanks to the Americans for their position, for their support, for their understanding.

We know how difficult it is to fight terrorism, whether it‘s in America itself or in Iraq or elsewhere.  It‘s not a simple proposition.  But we have to fight, and we have to win, and we shall win, all of us, because we represent a responsible future for every person on Earth to remain free and secure.

MATTHEWS:  Thank you very much, Shimon Peres, vice prime minister of Israel.  Thank you very much, sir, for your time.

PERES:  Thank you.

(END VIDEOTAPE)

MATTHEWS:  Coming up, we‘ll have the latest news from Haifa with MSNBC‘s Tucker Carlson.  You‘re watching HARDBALL on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  The “Associated Press” is reporting that Israeli warplanes are bombing a bunker in south Beirut where senior Hezbollah leaders were thought to be.  Earlier today, Hezbollah rockets hit the northern Israeli port city of Haifa again.  My colleague, Tucker Carlson of MSNBC is in Haifa, he joins us this evening with an update.  Tucker, be Earnest Hemingway for us, that great correspondent, tell us what it looks like, smells like, feels like, surprises you with. 

TUCKER CARLSON, MSNBC ANCHOR:  Well it‘s a clear, breezy night.  You‘d think it was stormy because there are thunderous explosions in the background.  I just heard one about 15 seconds ago, interspersed with jet sounds, those fighter planes you just mentioned are flying directly over our heads to southern Lebanon, which is about 20 miles to my left, right up the coast from Haifa.  We‘ve been hearing explosions all day long, haven‘t seen the effects of many of them.  There was a seaside cafe here in the port city that was hit by one.  Some of the rockets have tumbled harmlessly into the ocean. 

Hezbollah, whatever you think of it, not very good marksmen, some of these rockets, which are not very accurate in the first place, have gone far, far off their marks.  It hasn‘t prevented the Israelis from responding sensibly to the threat of these attacks.  We spent a good part of the day north of Haifa, first up near the border and then in Nahariya, a town, a very pretty seaside town about 15 miles from here north of us.  Found it essentially abandoned.  Visited the sites of a couple buildings that had damaged quite heavily by the Katyusha rockets, basically nobody on the street. 

Even as we were wandering around, we heard the thump, thump of more rockets coming in, saw an explosion and the aftermath, a little mushroom cloud of smoke appearing on the horizon quite near us and then heard nobody responding to it.  We didn‘t hear any sirens of emergency vehicles, police, ambulance, fire truck, none of that.  We heard nothing at all.  In fact it was completely silent.  It was a ghost town.  Reminded the crew, we‘re traveling with an NBC crew, who covered Katrina for about a month and a half and I think it reminded them too of New Orleans right after the storm.  Really no one there, but clearly, clearly still, this fighting is going on.  Despite the reports we‘re getting of Hezbollah positions crushed in southern Lebanon, clearly they have rockets, because they‘re throwing them he into Israel again and again.  They‘re not letting up even at this late hour. 

MATTHEWS:  Tucker, what‘s the scuttlebutt in terms of fellow reporters, your colleagues there.  Usually a lot of American people there in that bureau.  Is there a sense that this is politically going to last about week or two or what‘s the outlook? 

CARLSON:  Well, that is of course what‘s been reported in the “New York Times” and in some of the London papers, that the United States has this tacit agreement with Israel to let it go on for another week, but there‘s a very strong feeling here that that‘s not going to be enough, that you can‘t rout out Hezbollah from the air.  It‘s the same old story.  It‘s the same story that we talk about all the time. 

The limits of air power, you can‘t rout out an enemy that really has metastasized throughout that country, like late-stage cancer, whose weapons caches are hidden in civilian neighborhoods, you‘re not going to end that.  Man, there was a big explosion behind me a second ago, excuse me.  You‘re not going to get rid of those weapons with air power.  Balance that against the feeling in Israel here that Lebanon really is like Vietnam, that it‘s a quagmire.  It‘s quick sand.  You don‘t want to get involved in it. 

Add to that one more factor, that I wasn‘t aware of until this week, and this is a broad generalization, but I think it‘s true, and it is that Israelis are very sensitive about casualties.  You‘d think this is a military society, a society in which everybody serves in the military, yet it is a society very, very hesitant, and I think this says something good about Israel, to shed the blood of its soldiers.  They don‘t like to see casualties at all.  So I think there‘s much hesitancy to sending ground troops in to Lebanon and yet in the end that‘s, I think, what‘s going to be required if they‘re truly going to disarm Hezbollah. 

MATTHEWS:  Yes, it looks like reconnaissance in force.  Thank you very much Tucker Carlson in Haifa.

CARLSON:  Thanks Chris.

MATTHEWS:  Be sure to watch Tucker himself tonight at 10:00 p.m.  Eastern as MSNBC airs his special report on the latest in the Middle East conflict.  Up next as this crisis unfolds, is President Bush facing a political backlash from neo-conservatives who want him to be even tougher?  You‘re watching HARDBALL, on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  We‘re getting more information now from the “Associated Press” about the new round of bombings in Beirut tonight.  Israeli military officials say warplanes dropped 23 tons of bombs on a bunker in south Beirut where senior Hezbollah leaders were thought to be, possibly including Hezbollah leader Hassan Nasrallah.  While violence rages in the Middle East of course, the Bush administration is under fire from some neo-conservatives mainly at home who think the president isn‘t doing enough, he‘s not being tough enough in the world.  Here is MSNBC‘s chief Washington correspondent Norah O‘Donnell with the report. 

(BEGIN VIDEOTAPE)

NORAH O‘DONNELL, MSNBC CHIEF WASHINGTON CORRESPONDENT:  In the White House east room, President Bush today thrilled conservatives with his first veto of a bill to expand stem cell research, but at the same time Mr. Bush is facing an open rebellion from the right over his foreign policy. 

UNIDENTIFIED FEMALE:  It is an unhappiness among conservatives about the gap between the president‘s words and America‘s actions. 

O‘DONNELL:  At issue, what neo-conservatives call timidity in dealing with the world‘s hot spots. 

UNIDENTIFIED FEMALE:  The North Koreans test seven missiles in the week of our Independence Day, and what did we do?  We responded by emphasizing the importance of getting back to the six-party talks. 

O‘DONNELL:  The result they argue is an emboldened Syria and Iran.  former Speaker Newt Gingrich calls the Bush administration‘s moves abroad appeasement this morning on “Today” with Matt Lauer.

NEWT GINGRICH, FORMER SPEAKER OF THE HOUSE:  When we were faced with this in World War II Matt, we didn‘t say let‘s negotiate with Adolph Hitler.

O‘DONNELL:  Bill Kristol argues in the “Weekly Standard” that weakness is provocative and he calls for war, saying “we might consider countering this act of Iranian aggression with a military strike against Iranian nuclear facilities.  Why wait?” 

But not all conservatives agree.  George Will in the “Washington Post” called such neoconservative complaints “so untethered from reality as to defy caricature.” 

(END VIDEOTAPE)

O‘DONNELL:  Now, Chris, the White House dismisses the criticism from those they say are part of the chattering class, columnists and think tank intellectuals.  But it‘s also important to point out that this president is also facing criticism from some who say the U.S. finds itself with so little leverage to help diffuse today‘s crisis in the Middle East because he has frozen out so many countries diplomatically with what they call, “go-it-alone cowboy diplomacy.”  Chris?

MATTHEWS:  Thank you, Norah O‘Donnell.  I believe if some of those neoconservatives had been in a schoolyard fight in high school like they should have been, we wouldn‘t be seeing the world we‘re getting from them today.

Up next, MSNBC‘s Pat Buchanan and HARDBALL political analyst Bob Shrum will talk about that pressure on President Bush from the neocons.  Plus we‘ll get a live report from Beirut.  You‘re watching HARDBALL on MSNBC.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE:  This is not acceptable.  This is Lebanon.  We are human beings. 

(END VIDEO CLIP)

(COMMERCIAL BREAK)

(MARKET REPORT)

MATTHEWS:  Welcome back to HARDBALL.  Israeli warplanes were reported to be bombing southern Lebanon tonight.  The “Associated Press” reports that the Israeli military is targeting a bunker believed to house senior Hezbollah leaders.  Let‘s go now to “Time” magazine‘s Andrew Lee Butters, who joins us now from Beirut by phone.  Andrew, what are you hearing?

ANDREW LEE BUTTERS, TIME MAGAZINE (on phone):  I have not heard any explosions in Beirut recently.  There were explosions throughout this day here, this was a bloody day, I think the bloodiest so far in the eight day escalation of violence.

And there was in fact an attack quite close to my house, right up my street, where the Israeli missiles struck, what looked like drill welling equipment, and I went to check it out, and these drill welling cranes really do look like missile launchers, but that‘s about the—as much action as I‘ve gotten around my place.

MATTHEWS:  Andrew, give us a quick picture if you can of Beirut.  I understand you have the two parts of the city,  There‘s a one very European part, people call it the Europe—the Paris of the Middle East.  Does it still seem like the Paris of the Middle East?

BUTTERS:  Well, it‘s quite quiet right now.  I was just down having a drink with some friends, and almost everything is shut in the city.  The night clubs, the bars, the restaurants, it‘s all shut down now, and the concern among the residents of this country is that they spent billions of dollars to become this kind of party central of the Middle East, and to kind of reclaim its role as the Paris of the Middle East.  Now they‘re worried that that all is for naught.

MATTHEWS:  So that nice part of the city, the Parisian part, has that been destroyed or is it simply shut down?

BUTTERS:  No, it‘s simply shut down and the shelling is taking place on the suburban, people call it slums, but they‘re not quite that bad.  But there are very densely populated poor suburbs inhabited mostly by Shia Muslims who are the majority of this country, and they‘re also the majority of supporters for Hezbollah.

MATTHEWS:  Are the Maronite Christian centers being protected?  Is Israel avoiding hitting the Christian areas?

BUTTERS:  There has been so little bombing and damage in Maronite Christian areas.  I live in a Maronite Christian area, and so it‘s hard not to see that there‘s some kind of divide and conquer strategy going on.

MATTHEWS:  Great, thank you very much.  Please keep coming back, Andrew Lee Butters in Beirut.

Let‘s bring in now two political analysts, Pat Buchanan and of course Bob Shrum, both with us regularly.  Pat, let‘s go through the politics of this situation.  The neocons are out there complaining that this president isn‘t tough enough.  I have no idea what they mean, 50,000 dead in Iraq, it was supposed to be a cake walk.  Ken Edelman‘s out there today saying we should go other places, you have got guys who have wanted to blow up every Arab country on their list.  Why is going on in their complaint and why does the president pays five seconds attention to them?

PAT BUCHANAN, MSNBC POLITICAL ANALYST:  I don‘t know why he pays attention to them, Chris.  What they want, Chris, is a wider war, especially in the Middle East.  They want the United States to fight Israel‘s war against Hezbollah, Syria but especially Iran.

And the Israelis want us to fight Iran‘s well.  But it‘s not in the interest of the United States.  None of those countries, even Hezbollah and Hamas have not attacked the United States of America.  I don‘t think the country is listening to the neocons anymore.  I think they‘re discredited.  The question is, is Bush listening to them, because he was gone for awhile up through his second inaugural, very much according to a script they wrote.

MATTHEWS:  Literally. 

BUCHANAN:  Yes. 

MATTHEWS:  Shrum wrote it.  Not Shrum, Frum.  I keep saying you Shrum. 

It wasn‘t you Bob, it was that other guy we have on the show.  David Frum.  Hey Shrummy, are you willing to agree with Pat that there is a subculture now of the conservative movement who are extremely hawkish?  They are, of course, pro-Israeli.  Many Americans are pro-Israeli, but they‘re very hawkish on every front, not just the Middle East but China, they want to take on North Korea.  When we had that EP-3 incident early in the administration, they wanted to go to war with China.  Do they have the head of the president?

BOB SHRUM, HARDBALL POLITICAL ANALYST:  I don‘t know.  I don‘t know who has the president‘s head.  Dick Cheney used to, but maybe he‘s been discredited along with cowboy diplomacy.  Look, Pat and I differ in one way.  I strongly support Israel.  I don‘t expect to ever see any of the Buchanan brigades in the front lines of defending Israel.  The root of the problem here is that the United States is it tied down in Iraq, 130,000 troops there.  I don‘t know whether Bill Kristol and the neocons have thought about it, but if we were to bomb Iran, we essentially have right now 130,000 hostages in the middle of Iraq, who could be surrounded by hostile Shiites, it‘s a very, very difficult situation. 

MATTHEWS:  I just wonder Pat about the simple history.  We know from looking at the Arab world, as we‘ve come to understand it, that there‘s this division between the Shia, who are on the outs and they‘re coming to be the ins of course in Iraq and they‘re certainly already in control of Iran, taking on Sunnis, that‘s a war we‘re only vaguely understanding.  That‘s a 1,000-year-old war.  Do you think we‘re creating another 1,000 year war by killing so many Arabs?  I‘ve been afraid of this war from day one, because I‘ve always felt, based on history, every time you somebody, you‘ve got his brother, his mother, his family coming back to get you.  We‘ve killed 50,000 Iraqis in a war that was supposed to be a two-day wonder. 

When are we going to notice that the neocons don‘t know what they‘re talking about?  They‘re not looking at this country‘s long-term interests.  They‘re bound up in regional and global ideology and they have had no experience, I‘ll say it again, in even a school yard fight.  They don‘t know what physical fighting is all about.  They went to school and were intellectuals, but they he want our government to be their big brother.  I don‘t get it.  I don‘t know why we keep falling for it and the president, you say is he free of these guys yet or not? 

BUCHANAN:  Well, the president fell for it after 9-11 when they put their little precooked meal in front of him after he knocked down Afghanistan and so they said let‘s do Iraq now and Wolfowitz and all the rest of them.  But let me say this Chris, I think the president realizes now that we went into Iraq to pursue weapons that did not exist, a country that did not attack us, did not threaten us, and now we have created a great base camp for terrorism in the Anbar province, the west there, that did not exist. 

In response to Mr. Shrum, not only the 150,000 hostages, you attack Iran, Hezbollah will retaliate against the 25,000 Americans in Lebanon, you will have massive hostage takings and killings.  Are these people nuts?  You‘ve got to ask yourself.  I certainly hope the president is not listening to them, because I really question whether they‘ve got America‘s national interest at heart.  They are calling for wars against people that never attacked us.  I don‘t care how bad they are.  There are wicked people all over this world, but you don‘t go after people unless they come after you. 

MATTHEWS:  Shrummy?

SHRUM:  Well, Pat, I think we have to help Israel oppose Hezbollah and oppose Hamas.  It took 30 years for Israel, fighting Arab governments, to get most of them to finally accept the fact that Israel was going to continue to exist.  It may take 30 years to convince the terrorists that that‘s going to happen.  But I‘ll tell you where Israel is being smart in a way that the United States isn‘t.  They‘re going into southern Lebanon.  They‘re going to hurt Hezbollah, then they‘re going to get out.  They may have to go back again and again, but they‘re not trying to occupy the place. 

MATTHEWS:  Let me just correct something here.  I think we‘ve got to be very careful about Israel‘s national interest, America‘s national interest and ideology.  You can go into Israel, as I‘ve done fairly recently and argue a more liberal, more moderate position against the far right, the people at the Jerusalem Post, et cetera.  Shimon Peres is a man of the middle, maybe middle-left, but when he was on our program tonight, he was saying we are very proud of the fact as Israelis, never ever in our history, since 1948, to have ever asked an American soldier to do our fighting for us.  I don‘t believe Shimon Peres would ever do that, Pat.  I think you‘re talking about the guys over there on the right who might do it, but I haven‘t even heard them say America should be their fighters for them. 

BUCHANAN:  Well, a lot of them want us to attack Iran, they‘ve said so publicly.  But, let me tell you where Israel has been stupid.  Israel was provoked and attacked by Hezbollah, grabbed those two soldiers, killed eight Israelis.  They had every right to go in and get their soldiers and when the rockets came, every right to go in there and clean out southern Lebanon.  What did they do?  They launched a massive blitzkrieg against the civilian economy, knocking down air fields, lighthouses, roads, bridge, oil depots, power stations, putting these people through hell.  You have 500,000 refugees there now. 

They fought, what they‘re doing is imposing collective judgment on a whole people for the crimes of Hezbollah, which the Lebanese people, many of them, abhor and which their government condemned.  This is what is stupid and outrageous.  Israel had the high moral ground.  I am for them cleaning out Hezbollah after that.  They gave it away by this massive assault on innocent people, destroying that country and I regret we have a president who can‘t stand up and say at least that.  Israel is right about Hezbollah, they are wrong what they did to Lebanon. 

MATTHEWS:  Isn‘t that a problem Bob, that this president seems to be unwilling to wear the two hats that every great American president has worn since 1948, when Israel was recreated?  They said we‘re friends of Israel, but also the great power in the region, the power that will come in and referee and try to bring peace and be an honest broker.  It seems to me this president has never accepted that second responsibility. 

SHRUM:  Yes, I think that‘s right, but if Bill Clinton or Al Gore or John Kerry were president, I don‘t think you‘d have this situation today, but if you did have it, they would be standing with Israel.  At the same time they would be talking to the Arabs.  What this administration did in a very conspicuous way was from the very beginning say they were going to absent themselves from the Palestinian-Israeli problem.  They could have sent a signal at the end of 2000 that they wanted Arafat to sign the agreement that had been hammered out by Barak and Clinton at Camp David and Taba.  The best agreement the Arabs were ever going to get.  Most of the West Bank and the capital and the old city of Jerusalem.  Instead, they sent a message, they were going to stay out of it and what we‘ve had ever since is this kind of violence and deterioration. 

MATTHEWS:  Bob Shrum, I still blame Arafat, I don‘t blame Bush. 

Anyway thank you Bob Shrum, great report.

SHRUM:  I blame Arafat too. 

MATTHEWS:  Always blame him first, it‘s the smart move.  Thank you Pat Buchanan. 

Up next, we‘ll talk with Senator Trent Lott of Mississippi about the chances for a diplomatic solution.  This is HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Right now in Cyprus, good news.  The luxury cruiser Orient Queen has arrived with about 1,000 Americans aboard, refugees from Lebanon.  NBC‘s Dawn Frantangelo is in Cyprus and joins us by phone.  Well that must be a happy scene, Dawn, or isn‘t it?

DAWN FRATANGELO, NBC NEWS (on phone):  Well, it is.  I mean, we haven‘t seen any people come off, Chris.  It really just pulled into the port here in Larnaca, Cyprus.  But I‘m sure that there is much relief among those 1,044 people who are onboard the Orient Queen.  It was an eight-hour journey for them, leaving Beirut, getting to Cyprus.

And I really think that most of the people here are going to be expressing major relief, probably some frustration, but for the most part, relief to be here.  But they still have a long night in front of them.  They will be greeted by the U.S. ambassador here in Cyprus and then processed in a building about 100 yards from where this ship is.  They will be given food and water and also they will be able to speak to a couple of travel agents who have already set up inside this building to figure out any kinds of travel plans they may have.

Now there are three charters that the State Department has arranged that will leave tomorrow, and frankly, those three charters, they carry about 300 people a piece, can really carry just about everyone who was on this boat.  So by the time they are processed, by the time they make their travel plans, it‘s a very long day for all of these people.  So I think the overwhelming feelings: relief and exhaustion.

MATTHEWS:  OK, thank you very much for that good news, Dawn Frantangelo in Cyprus.  Coming up, Senator Trent Lott to talk about this war.  You are watching HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  Will the fighting between Israel and Hezbollah stop within one more week?  Can Lebanon crank down on Hezbollah units within its borders?  And can George Bush, the president help broker the piece?

Here to dig into it, especially the politics, globally and locally, Mississippi Senator Trent Lott.  Senator Trent, let me shine you up first.  You are a great old fashion conservative.  You don‘t have any special angles in these regions, you just want peace in America to prevail.  What can he do?  Is he doing the right thing or are we holding back too much over there, the president?

SEN. TRENT LOTT ®, MISSISSIPPI:  I don‘t think we are holding back too much.  I think it‘s going to be very difficult to bring the fighting to a conclusion within a week because I think it will be hard for Israel to bring Hezbollah under control in a week.

I do think the president needs to be engaged, you need to pursue every possible angle.  But this has ramifications beyond just southern Lebanon.  There are some real difficult problems that are going to have to be resolved and while diplomacy has always got to be pursued, it cannot be the primary principle in what you are trying to achieve here.

MATTHEWS:  If you got up some morning and you were told by a telephone call from the Hill that the president had attacked Iran, had attempted to blow up their nuclear facilities, would you immediately salute or would you say, “Wait a minute, why would he do something like that?”

LOTT:  I always like to know what is going on in advance, Chris.  I raise questions about going into Iraq when we did because I didn‘t think that we had thought it through, didn‘t have proper consultation with the Congress.  We started working on that. 

So the answer to your question is it would depend on what has been the conduct or had been the conduct of Iran, what had been the consultation, what was the situation.  Iran is a very big, huge problem in the world, and we cannot allow them to start freelancing with nuclear weapons.  so I am not saying no, but I would want to know in advance what the lead-up was.

MATTHEWS:  If they‘re the No. 1 worry in the world, why didn‘t we destroy—the No. 1 check on their power in the region, Iraq, why did we hand over the majority power in Iraq to their allies, the Shia in Iraq?  Why didn‘t we destroy their enemy and give them another country?  Why have we created, in the words of one of the leaders over there in the Sunni side, a Shiite crescent?  If we were afraid of them, why did we hand them so much stuff?

LOTT:  Well we did the right thing to take Saddam Hussein out, just think what the situation would be now if you added the problem and influence of Saddam Hussein in the situation in Lebanon and Israel.

MATTHEWS:  But they were offsetting powers, they weren‘t combined powers.

LOTT:  Well yes, Iraq and Iran fought.  That‘s like two wildcats in a bag.  It would be all right if we could just put them in a bag and let them fight it out.  But their influence in the entire region—in fact, beyond the region, is very dangerous, so I don‘t think that there is any use in going back and trying to re-create what has happened.

We just have to have to acknowledge there is a serious problem here now.  Now Hezbollah—you know, what I don‘t understand about a lot of the people involved in the region—they hate the Jews, they hate the Americans, and they hate each other.

The Sunnis and the Shiites kill each other, and you have got Hezbollah and you‘ve got Hamas.  I don‘t understand how they figure anybody wins by this continuing insane violence killing innocent men, women and children.  And this Hezbollah group is extremely dangerous.

MATTHEWS:  Well I hate to say it, you know, it‘s their part of the world, not ours.  And we had a civil war in this country that caused 600,000 dead and they didn‘t come in and get involved in our civil war.  Why are we involved in theirs?

LOTT:  We tried to get others to, if you recall, Chris, but the answer is, look, it‘s not only our problem.  It is a worldwide problem.  I don‘t think that we should expect that we as Americans just are going to step in and find a solution. 

I think we have to be concerned, I think we have to be involved constructively.  I think we have to understand that the Israelis have a right to defend themselves and the right to exist.  I think that we have to weigh what is going on in Lebanon and what is the influence of Syria and Iran.  But I am like you, now, I am not a guy that thinks that America has to take the lead and make the final decision on every conflict in the world.  What is in our best interest?

MATTHEWS:  Thank you very much.  It‘s great to have you on.  I wish we had more time.  Senator Trent Lott of Mississippi, sir, thank you for joining us in the middle of this war.  Right now it‘s time for “TUCKER,” tonight from Israel itself.

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

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