updated 8/1/2006 11:29:16 AM ET 2006-08-01T15:29:16

Guests: Nicolle Wallace, Howard Wolfson, K.T. McFarland, Mark Green

CHRIS MATTHEWS, MSNBC HOST:  From Rockefeller Center, New York, New York—the town so nice, they named it twice.  The Big Apple, Metropolis, Gotham.

Let‘s play HARDBALL.

(MUSIC)

MATTHEWS:  Good evening.  I‘m Chris Matthews.  Welcome to HARDBALL.  Tonight, as you can see we‘re celebrating the 10th anniversary of MSNBC.com, live from Rockefeller Plaza in New York City. 

Tonight we‘re surrounded by people here at this beautiful New York landmark.  Just take a look at this crowd on this very hot summer night. 

Later tonight, we‘ll go to one of New York‘s most beautiful locations, the top of the Rock to talk to Brian Williams. 

Later, we‘re going to have a big show tonight from America‘s biggest city.  In a moment, we‘ll get the latest on the Mideast crisis from NBC reporters from the region, plus a strong dose of New York-style politics from two candidates and two political professionals. 

We start in the Mideast with the latest from Haifa and NBC‘s Peter Alexander.  Peter, thanks for joining us tonight.  Is Israel still on the attack in this war? 

PETER ALEXANDER, NBC NEWS, HAIFA:  Well, they are at this hour, Chris.  The airstrikes have essentially lulled nearly to a stop, but the ground war continues.  Tonight, just a matter of hours ago, the prime minister of this country, Ehud Olmert, spoke only for the second time since the conflict began 20 days ago, speaking specifically to a group of mayors in the northern towns and cities in Israel that have been heavily targeted through the course of this war.  He said right off the bat, Chris, there is no cease-fire, there will not be a cease-fire.  He says Israeli forces continue fighting by air, sea, and by land. 

Also today, the Defense minister, Amir Peretz, announced that this will be expanded, and that they not just will they expand the ground war, but they will also strengthen their ground forces.  It amounted, the speech from the prime minister, essentially to a motivational speech.  The commentary here in Israel, articulated it as being a pep rally designed to rally the troops.  Those who have heard from different sides that there is a cease-fire in effect, Olmert wanted his troops to hear this war is not done, we continue the battle and will not stop until Hezbollah has been beaten and it has no more rocket capacity.  It‘s unable to fire any more of those rockets.  That and all three of the Israeli soldiers have been returned home.  Not just the two kidnapped in south Lebanon by Hezbollah, but those—that individual, Corporal Gilad Shalit, who was kidnapped last month by Hamas. 

One the other headlines of course over the last many days has been the number of rockets falling here.  There were 156 rockets, a record yesterday, Chris.  Today, zero.  Two mortars is all that fell.  Those two mortars fell in the city of Kiryat Shmona, a town that yesterday was hit by nearly 100 rockets. 

And finally today, as we visited streets of Haifa, went downtown to visit with shop keepers and members of families who just were, for the first time, emerging from their shelters and from their homes, the quiet was again interrupted by a new threat.  I shouldn‘t say a new threat, by a familiar threat, the threat of a suicide bomber.  Israeli police, including the chief of Haifa police, told me that they found two suspected suicide bombers.  They had a hot alert and they quickly determined which car it was, catching those two men, while we were on the scene watching it happen. 

They have dismantled the car.  They did not find any explosives, but they do believe these two men were likely to be meeting up with another individual to try to carry out this plot.  There have been at least five such thwarted efforts since this conflict began.  Chris? 

MATTHEWS:  Peter, let me ask you about the possibility of a wider war.  We just heard late this afternoon that the president of Syria, Bashir Assad, is readying his army—he‘s mobilizing it for possible defensive action.  How is that being received and understood in Haifa? 

ALEXANDER:  Well, the Israeli army is saying very little about the information we have about what is happening in Syria, but it‘s important to note that within the last several days, top government leaders here said they had no intention of drawing Syria in to a wider war, that right now they were satisfied confronting Hezbollah specifically on the south Lebanon border.  Chris? 

MATTHEWS:  OK.  Thank you very much, NBC‘s Peter Alexander in Haifa in Israel. 

Now to Lebanon and NBC‘s Richard Engle, who joins us from Tyre.  Thank you very much, Richard.  How is the attack coming there, are they hitting the rockets, the launchers, or are they hitting population centers—the Israeli air force? 

RICHARD ENGEL, NBC NEWS, TYRE, LEBANON:  Right now there was something of a lull.  Yesterday there was that major attack Qana.  We went back to the scene today.  All of the recovery efforts have effectively stopped.  The town was a ghost town—there was no one except for a few Hezbollah people who seemed to be mobilizing today in downtown Qana.  Everyone else was out of the city, and that was the scene we saw across south Lebanon today.  People are using this 48 hour reprieve that came on the back of that, what is called here the second Qana massacre, to leave the area.  All the civilians are getting out; Hezbollah seems to be mobilizing, restocking, resupplying, using this opportunity for a new phase in the fighting. 

Today, we heard artillery strikes and there were, I believe, at least two Israeli airstrikes, but nothing along the same scale that we‘ve seen in the last 20 days. 

MATTHEWS:  I guess what I‘m asking for is the toughest assessment I can ask you for.  Is it possible for Israel, for its splendid air force to be so exact in its attacks that it can hit the launchers and the rockets, which have been threatening and will threaten Israel, without killing people—civilians?

ENGEL:  I think the answer is obviously not.  It‘s obviously not.  I mean, more than 50 people were killed just yesterday.  Today the Red Cross was using this opportunity to look for more bodies and pulled out another 40 bodies from the rubble in other villages.  According to U.S.  intelligence, Israel is getting more effective in confronting these Hezbollah rocket launchers, the batteries of rockets, but to answer your question, are they able to do that with the kind of precision and accuracy and not kill civilians, that is the whole issue at hand right now, this tremendous loss of civilian life yesterday. 

We were trying to figure out today, where all the men were in this village.  If you notice, all of the people in the basement of this three-story building that was hit yesterday by two Israeli airstrikes, were women and children, a lot of them young boys.  So we he went house to house and tried to figure out where all the young men were.  It seems that some of them were fighters, some of them were Hezbollah members that were out—this according to Hezbollah people who didn‘t want to be interviewed, but we convinced them to talk to us.  Others were in another house that was nearby—I‘m not sure if that was the initial target, but there was a separate apartment where young men were living that was not hit yesterday. 

MATTHEWS:  Well, take care of yourself, Richard Engel, NBC‘s bureau chief in rMD+BO_rMD-BO_Beirut. 

Let‘s go back to our customers we have right here at Rockefeller Center.  We have Nicolle Wallace, formerly of the White House, formerly George Bush‘s communications director, and had a higher job at the very end, I think, and Howard Wolfson, a very articulate spokesperson, to be politically correct, for Hillary Clinton up here in New York. 

Let me ask you both:  Is this war in Israel, the one between Israel and Hezbollah, a partisan question or do the American people agree on this war?  You first, Nicolle.

NICOLLE WALLACE, FMR WHITE HOUSE COMMUNICATIONS DIR.:  We talked about that actually, before we started here, and I think it‘s a hopeful sign that, at this moment, it is not.  I saw Senator Schumer yesterday with nothing but praise—I understood it to be praise; I don‘t want to speak for him, but—for the president‘s handling of the crisis. 

MATTHEWS:  You think he‘s handled this well from the beginning of taking office.  George Bush became president in 2001, with a proclamation of benign neglect—we‘re not going to get involved in shuttle diplomacy, that sort of thing, like Warren Christopher did before him, and Bill Clinton, to a large extent.  Do you think that was good for the region? 

HOWARD WOLFSON, ADVISER TO SEN. HILLARY CLINTON:  Do I think that the president could have been more engaged throughout this period, yes.  But the American people, the Congress are united in a bipartisan way, that Israel has a right to defend itself.  It‘s a tragic and a serious situation, but people right now are united in this country on it. 

MATTHEWS:  What about the connection between the Iraq war and the building of this Shia crescent, as King Abdullah calls it, between Tehran and Baghdad and now Beirut?  That was largely a construct; it wouldn‘t have been possible had we stayed out of Iraq.  Do you think our actions in Iraq have contributed to the problem on the northern border of Israel? 

WOLFSON:  I do.  I do think that the growing debacle in Iraq has created a scenario under which Iran feels emboldened to encourage Hezbollah to attack Israel.  I think Iran seems to neither fears us nor respect us right now, and that‘s a problem because Iran is a serious threat to this country. 

MATTHEWS:  Let me ask you about the politics—I‘m not going to ask you the same question, because you‘ll have a different answer.  Let me go to this one—

WOLFSON:  Maybe she would agree. 

WALLACE:  Chris, let me say one thing—I think that this back-handed insult of the president‘s policies is going to undermine our—

MATTHEWS:  You mean by King Abdullah? 

WALLACE:  No, by my colleague here. 

WOLFSON:  By Chuck Hagel today. 

WALLACE:  To say that the president‘s neglect of the region has brought us to where we are today, it‘s ludicrous.

MATTHEWS:  That‘s not what he said.  He said that our war in Iraq has opened up the Shia to launch an attack against Israel. 

WALLACE:  That was your question, but he started by saying the president‘s basically neglect the region brought us to where we are today, and that is the—I think that‘s what leaves Americans with an incredibly negative taste in their mouth and that‘s what we need to guard against, at moments like this.  We‘re heading into a moment where—where the midterm elections are going to take a back burner—at least I hope they would—to what is truly a crisis that should unite our country.  And it‘s this kind of, you know, back-handed insults for the administration and for our leaders. 

You know I see now—I‘ve been out of the White House only four weeks and it‘s real easy to sit in the cheap seats and throw political pot shots.  It‘s a lot harder to be Secretary Rice shuttling around the world, up 24/7...

MATTHEWS:  ... Well that‘s where most of the Democrats are, in the cheap seats.

WALLACE:  Well, you know, I think you‘ve got to be real careful at moments like this.

MATTHEWS:  So you‘re with Senator Lieberman who believes you‘re not supposed to criticize the president in the time of the war.

WALLACE:  Well you could lose the election for him by saying, “I‘m with Senator Lieberman.”  So be careful, I don‘t think we want to meddle.

MATTHEWS:  Well you be careful, I‘m asking you, it sounds like you‘re saying what he‘s saying in this very tough race up in Connecticut, the neighboring state is, it‘s wrong to criticize a president during time of war and that‘s what you just said.

WALLACE:  Well I think the president, more than anybody else, understands and celebrates that in a democracy, you can criticize your leaders, you can debate the policy.  What I take issue with, is you asked we are—if this is a moment of bipartisanship and I said I would hope it was.

MATTHEWS:  During Korea, the Republicans won the presidency by attacking Truman‘s handling of Korea.  In 1968, Nixon won the presidency by attacking Lyndon Johnson‘s handling of the war in Vietnam.  When did the rules change?  So that you can‘t criticize an incumbent president.

WOLFSON:  When President Bush got into office.

WALLACE:  I don‘t think the rules have changed.  I think there are movies made of those who are criticizing this president and his policy in Iraq.  But that‘s not going to make us safer, that‘s not going to bring our troops home any quicker, and it‘s not going to bring this struggle into focus for the American people, which again, having come out of six years of being...

MATTHEWS:  ... What‘s it like—here we are in Rockefeller Plaza, the splendid place.  I mean, it‘s one of the great places.  I guess everybody comes here.  They come to New York because of the Empire State Building, they take the ferry.

WOLFSON:  The “Today Show.”

MATTHEWS:  The “Today Show,” of course when they can watch that live.

WALLACE:  HARDBALL.

MATTHEWS:  Tonight, HARDBALL.  Does it feel different to come as a red-state politician working for the president up to the ultimate blue state, Hillary Clinton‘s home turf?

WOLFSON:  We are actively working for her vote.  We talked about that before the show began.

MATTHEWS:  What‘s it like?  How does it feel different to be surrounded by Dems?

WALLACE:  You know, it is different.  And I am very grateful to have worked for a president who was humbled by this great debate, and who really understood that what he was doing and the changes that he seeks in this incredibly volatile region are hard and they‘re hard for people.

In response to a question David Gregory asked on Friday, Prime Minister Blair gave an incredibly eloquent explanation, I think, of this moments that we‘re in right now.  And I think that—you hear from people like Tony Blair and sometimes in a city like New York, that cuts through a little easier.  What he said was the only mistake we can make is to think that it wouldn‘t be hard, to think that it wouldn‘t be hard to bring change and to bring democracy in the Middle East.

MATTHEWS:  Do you think we should give every president who gets elected from now on should get English lessons from Tony Blair?  Because sometimes when you hear him speak, it sounds like a translation at the  U.N.?  I‘m talking all politicians, not just our president.

WALLACE:  No.  Look, Tony Blair, he‘s a poet.

MATTHEWS:  He‘s wonderful.  He‘s like Hugh Grant, right?  We‘ll be right back with—we‘re going to be out with the crowd here and see how she mixes in with these Democrats, these blue state types.  Howard Wolfson, Hillary‘s spokesperson.  Nicolle Wallace, ex-spokesperson for the president.  We‘re live in the plaza here in Rockefeller Plaza in a bipartisan way with the 10th anniversary of MSNBC.com.  And up next, we‘re going to talk to the people.  That‘s coming up right now.  You‘re watching HARDBALL.

(COMMERCIAL BREAK)

MATTHEWS:  You‘re looking southward right now, 30 Rockefeller Center, that‘s quite a view, looking down toward the battery of New York, the bottom part of New York that used to have the World Trade Center.  We‘re here with Nicolle Wallace, former communications director.  She essentially had a higher job with President Bush.  And a guy who would like to have a job like that, Howard Wolfson, who dreams at night of becoming Nicolle Wallace.  Thank you.  Let‘s get some questions here.  Your question, one sentence.

UNIDENTIFIED FEMALE:  Do you think President Bush will ever back off his mantra of allowing Israel to defend themselves?

WALLACE:  Well, Israel is a democracy, in the heart of the Middle East and certainly a democracy that‘s attacked by a terror network will and should retain the right to defend herself.

MATTHEWS:  Next question.

UNIDENTIFIED FEMALE:  I don‘t have a question.

MATTHEWS:  Oh my god.  Any other questions here, come on.

UNIDENTIFIED MALE:  I‘d like to know what happened at the U.N. today.  I know that Condoleezza Rice is coming back from overseas, and I haven‘t heard the latest.  I don‘t know what the latest was today.

MATTHEWS:  We don‘t know.

WALLACE:  We‘ve been out here.

UNIDENTIFIED MALE:  How come you keep pushing Hillary‘s candidacy? 

And can she get elected in the middle of the country?

MATTHEWS:  You‘re asking me?  Because she‘s leading every poll by about 3-1 and I go with the polls.  I have no other way of looking at things.  And Rudy leads the Republican polls, not as much.  But Hillary keeps walking away with it because Hillary is the only woman in the race and I think, as they say in Massachusetts, the shape of the race defines the winner.  Four guys against her, they split up the guy vote, she wins the women‘s vote and the liberal guys, the Alan Alda guys, you know, the real sensitive guys, she wins.  But I don‘t know.

UNIDENTIFIED MALE:  How long do you think the United States is going to let Israel kill all these Lebanese people?  How long until they let them go?  I mean, look how many people were dying right now in Lebanon.  How long are they going to let that go?

WOLFSON:  It is a tragic situation, and I would hope that Hezbollah would stop firing rockets from civilian populations, which is really the cause of the violence and the destruction there. 

You know, six years ago, Israel left Lebanon, they left Lebanon in the hopes that Lebanon would be a friend and a democracy.  And in that six years, Hezbollah used that time to acquire rockets, to launch attacks on Israel, and this latest war was precipitated by Hezbollah launching rockets into Israel and by kidnapping Israeli soldiers.

And the difference between Israel and Hezbollah is when Israel dropped the bomb and those civilians were killed and it was terrible, people in Israel agreed, with Hezbollah shoots missiles into Haifa, Hezbollah dances and celebrates, and that‘s the difference.

UNIDENTIFIED MALE:  What about all the—I mean, we‘re talking Hezbollah, you‘re—but you‘re dying all the civilians, thousands and thousands of civilians and you‘re talking about two hostages.  We‘ve got 11,000.

WOLFSON:  Hundreds of rockets have been launched by Hezbollah into Israel.

UNIDENTIFIED MALE:  We have 11,000 Lebanese hostages in Israel.  How come they don‘t let them out?  For two hostages?  That‘s the only negotiation they can get out of it.

MATTHEWS:  OK, thank you.

UNIDENTIFIED MALE:  Yes, 11,000.

MATTHEWS:  Nicolle, do you want to say something to this gentleman?

WALLACE:  I think this is why this illusion is to empower the Lebanese and to have the Lebanese army patrolling its own border.  And that‘s what you want, that‘s what America wants and that‘s where hopefully we‘re heading.

UNIDENTIFIED MALE:  How about we just protect?

WALLACE:  We need peace and a permanent settlement and I think the key is to have the Lebanese army and the Lebanese people protecting itself and to strengthen the Lebanese army.

UNIDENTIFIED MALE:  You think right now with all these bombings, you think you strengthen the Lebanese army.  Today, they just bombed two military armies, and they‘re trying to protect.  They‘re trying to do anything—they‘re not giving them a chance.

WOLFSON:  For six years they had a chance.

MATTHEWS:  OK, let me ask the crowd.  I want to ask the crowd, how many people here think the United States should support Israel down the line?

(APPLAUSE)

MATTHEWS:  How many people think we should be even handed?

(APPLAUSE)

MATTHEWS:  How many think we should be pro-Hezbollah?

UNIDENTIFIED MALE:  Nobody.  I‘m telling you.  We don‘t want to be pro-Hezbollah, but we want Lebanon to be safe.  We want Lebanon to be protected, not bombed like that.  Not in Israel killing everybody in Lebanon.

UNIDENTIFIED FEMALE:  (OFF-MIKE).  Lebanon is occupied by Hezbollah, not by Israel, not by America, not by the U.N.  It is occupied by a terrorist group that we have to get rid and if the U.S. has to get involved, I served in the Israeli army on the Lebanese border and I saw exactly with my own eyes what Hezbollah does to these citizens.  They use them as human shields daily.  They give them social services such as money, food, education, anything.

MATTHEWS:  We‘re going to come right back, right here, Rockefeller Plaza where the international debate is happening right here.  Back with more HARDBALL from Rockefeller Plaza in New York City. 

(COMMERCIAL BREAK)

MATTHEWS:  We‘re back at Rockefeller Plaza, back with Howard Wolfson, a very close friend of Hillary Clinton.  He has the power to speak for Hillary Clinton, what a honor.  And we have Nicolle Wallace, recently very powerful at the White House, now an absolute nobody.

WOLFSON:  Not at all.

MATTHEWS:  Let me ask the question of the crowd.  How many people here

now take a second to think, would like to see Hillary Rodham Clinton, the senator from New York, the next president of the United States?

(APPLAUSE)

MATTHEWS:  How many would not like to see her as the next president of the United States?

(APPLAUSE)

MATTHEWS:  Hillary wins.  How many would like to see Rudy Giuliani the next president of the United States? 

(APPLAUSE) 

MATTHEWS:  That‘s weak.  I‘m going to reassess my thinking here.  How many would not like to see Rudy Giuliani?  How about Senator John McCain?  Does nobody have any—tell me who you like?

UNIDENTIFIED FEMALE:  Al Gore.

MATTHEWS:  Al Gore.  How many would like to see Al Gore?  I think it‘s a lonely crowd here.  What do you make of that Howard?

WOLFSON:  A mixed audience.

MATTHEWS:  A mixed audience for Hillary, I think.

WOLFSON:  No, a good crowd for Hillary, but hopefully these folks know she‘s running for re-election and those of them who are New Yorkers will be voting for her in the fall.

MATTHEWS:  You‘re a spokesman for Hillary Clinton, right?

WOLFSON:  I am, yes.

MATTHEWS:  Tell me as spokesman spokesperson for Hillary Clinton, will the serve of a full U.S. Senate term if elected this November?

WOLFSON:  All she‘s doing, Chris, as you know, is focusing on her re-election.  That‘s the only thing she‘s thinking about right now.

MATTHEWS:  But if I were to ask you the question as her spokesperson, will she promise not to run for president and to serve a full Senate term, your answer is?

WOLFSON:  My answer is she‘s focusing on her re-election as the sole focus of her activity.

MATTHEWS:  What would you call that answer, Nicolle?

WALLACE:  Bad spin.

MATTHEWS:  Let me ask you this.  Will the Republicans ever win in history as long as we live, New York state?

WALLACE:  Oh, I don‘t know.  I‘ve only been here three weeks.  I don‘t have a good enough feel.

MATTHEWS:  Who out here would like to come forward real quickly and tell me who they think would be the best person they can think of to be the next president of the United States?  Come up and say it.

UNIDENTIFIED FEMALE:

UNIDENTIFIED MALE:  George Allen, Jeffersonian democracy and freedom.

MATTHEWS:  George Allen.  Anybody heard of George Allen?

This is the weakest political crowd.  Let me ask you, anybody from Connecticut?  Who‘s from Connecticut?  Step forward.  Are you a Democrat?

UNIDENTIFIED MALE:  Yes.

MATTHEWS:  Are you a Democrat voting in Connecticut?

UNIDENTIFIED MALE:  Yes, I am. 

MATTHEWS:  Who are you going to vote for, Lamont, the challenger or Joe Lieberman, the incumbent for Senate?

UNIDENTIFIED MALE:  Lieberman.

MATTHEWS:  Why?

UNIDENTIFIED MALE:  He‘s—I like his views, he‘s...

MATTHEWS:  ... Are you for the war in Iraq?

UNIDENTIFIED MALE:  Not for it, no.

MATTHEWS:  Well did you support it when it started?

UNIDENTIFIED MALE:  No.

MATTHEWS:  No, but you like Lieberman anyway.  That‘s interesting, so you‘re an anti-war Lieberman guy.  Who came—come up, who was the big mouth back here?  Who was the guy that said he‘s for Lamont?  Moveon.org.   He switched, now that‘s the sign of who is going to win, when the Lieberman guys stands up.  What do you think, who is going to win that race?

WOLFSON:  It‘s going to be very, very close, down to the wire, I think.

MATTHEWS:  I think so too.  What do you think?

WALLACE:  I think it‘s a sad, sad state for the Democratic Party that a guy who supported of the military and supports us defending ourselves is in dire straits with the Democratic Party.

WOLFSON:  Typical Republicans don‘t understand the debates.

WALLACE:  I don‘t understand the Democratic Party, I admit it.

MATTHEWS:  What‘s wrong with having an argument over whether we should be at war with Iraq or not and having an election about it?

WALLACE:  Nothing wrong with it and it really is about the Democratic Party.

MATTHEWS:  I think the Democrats—I think it‘s going to be too close to call, right?

WOLFSON:  Very, very close.

MATTHEWS:  I think it‘s too close to call.  How many here for Lamont? 

See, that‘s a problem.  How many here for Lieberman?

(APPLAUSE)

WOLFSON:  Well we are in New York, after all.

MATTHEWS:  We are in New York.  Anyway, thank you very much, Howard Wolfson, you‘re a great guest.  Nicolle, you‘re always a great guest.  Unemployed.  An unemployed beautiful woman.  Nicolle Wallace and Howard Wolfson, spokesman.  We‘ll be right back with much more serious business about the war in Iraq and the war in the Middle East between Israel and Hezbollah, the serious stuff when we come back.  We‘re here for the tenth year anniversary of MSNBC.com from Rockefeller Plaza in New York.  We‘ll be right back. 

(COMMERCIAL BREAK)

MATTHEWS:  (INAUDIBLE) 30 Rockefeller Plaza.  We‘re celebrating MSNBC.com‘s 10th anniversary.  Later, I‘m going to go into the audience again to see what these folks have to say.  I‘m surprised by some of the politics before, but definitely pro-Hillary up here. 

We‘re going to be talking about the hot politics from two candidates right now, Democrat Mark Green—he‘s running for AG, here, attorney general of New York state, and Republican, K.T. McFarland, who has the daunting task of running for the United States Senate against incumbent, Hillary Rodham Clinton.  Well, we have to ask, why you think you can beat the unbeatable Hillary?  She‘s the only person out there that got a big applause. 

K.T. MCFARLAND, ® NY SENATE CANDIDATE:  Look, Chris, it‘s all about choices.  I worked for three Republican presidents, I spent my entire professional life fighting against single party rule, which was the communist system of the Soviet Union.  And why should we have single party rule in the United States, why should we have it in New York?  We should have a choice.

MATTHEWS:  Are you the sacrificial lamb? 

MCFARLAND:  I absolutely am not a sacrificial lamb.  Hillary Clinton is beatable. 

MATTHEWS:  What kind of odds would you want from me, to bet money?  If I were going to put $1000 down and you were going to put $1000, what odds would you demand from me, 40-1, 50-1? 

MCFARLAND:  I don‘t play the gaming table, so I really don‘t know.  I‘ll tell you I‘m ahead in the polls against Mrs. Clinton compared to where Mr. Green is against his opponent. 

MATTHEWS:  OK.  Let me talk about, you‘re running against a dynasty, Mark Green, you‘re running against Mario Cuomo‘s kid, Andrew Cuomo, right?

MARK GREEN (D) NY ATTY. GENERAL CANDIDATE:  Right.

MATTHEWS:  How can you dare take on the Cuomo dynasty in New York state among Democrats? 

GREEN:  If Mario Cuomo were running, I wouldn‘t run.  He would win.  But you don‘t automatically elect the son.  It happened to work like that in Texas for governor and president, a guy named George W. Bush.  At the end of the day, Chris, I actually have unjustified faith in voters.  They‘re going to look at who has the best record and agenda to succeed, not anybody, but Eliot Spitzer, who is the gold standard for attorney general.  And because we‘ve known each other a long time, I‘ve been the public advocate and consumer advocate of this city and this state, going after the tobacco companies and winning, going after racial profiling and winning, stopping companies from discriminating against women who are domestic violence survivors.  So if I‘ve done that for the city, my argument is, I can do that for the whole state. 

MATTHEWS:  Why is the murder rate going up in this city?  K.T., why is it going up?  Why is the murder rate going up in every East Coast city, right now, murder rate, violence rates, what‘s going on?  The economy is better. 

MCFARLAND:  The economy is better in New York City, but the economy in New York state is not.  The economy in New York state—it‘s the highest-taxed state in the country.  Jobs are fleeing New York state, upstate New York, western New York.

MATTHEWS:  You sound like Jack Kemp—you lower taxes and everything gets better. 

MCFARLAND:  Things do get better if you lower taxes.  Things get a lot better—

MATTHEWS:  You can cut the crime rate with lower taxes?

MCFARLAND:  Because people get jobs.  When taxes are lower, the economy gets stimulated, you cut the size of government. 

GREEN:  Chris, you asked why the murder rate going up, which is a hard question, and the answer is high taxes.  We are dealing with an ideological answer.

MCFARLAND:  No, the answer is no jobs.  The answer is, people don‘t have jobs. 

GREEN:  The greatest miracle in domestic policy in my mind in about the last decade and-a-half is the murder rate in the state and this city, which used to be the murder capital, has fallen two-thirds.  That doesn‘t help the 500 people who are killed every year, but it used to be 2000 a year. 

MATTHEWS:  I remember.

GREEN:  Now, maybe methamphetamine is up upstate and around the state

there‘s a small uptick, but in some other cities, like Detroit, the murder rate has spurted 20 percent.  Not yet like that in New York. 

MATTHEWS:  Let me—I want an honest answer, not a partisan answer.  Rudy Giuliani came into this city, he stopped the squeegee guys, he stopped the broken windows, he played tough, he rooted for the cops, he didn‘t (ph) go overboard with the cab drivers and some other crazy stuff.  Did he make this city safer when he was here? 

MCFARLAND:  Absolutely. 

MATTHEWS:  Did he make the city safer, yes or no?

GREEN:  Sure—yes.

MATTHEWS:  Good.  I love honest answers.

GREEN:  Dinkins and he reduced the crime rate. 

MATTHEWS:  Dinkins reduced the crime rate?  I have never, ever heard that. 

MCFARLAND:  I‘ve never heard that one. 

GREEN:  You aren‘t studying it.  Dinkins increased the number of cops

by 25 percent; Giuliani continued it.  The crime rate began to fall under -

MATTHEWS:  You‘re saying that Dinkins was good as a crime fighter? 

GREEN:  Look at the data.  You know who Dinkins‘ police commissioner was?  Ray Kelly, who is the current PC under Mike Bloomberg.  So if you look at crime reduction, it started in 1991, under Dinkins, it accelerated under Rudy Giuliani.  But I‘ll mention it to Rudy, who is umpiring a softball game I am playing in on Saturday.  And I will not yell, “Kill the ump,” because I‘ll get in big trouble. 

MATTHEWS:  That‘s a long answer.  Let me ask you about the president.  You know, the strongest security concern in this city—and I‘ve talked to a lot of people—is of course 9/11, and of course how it‘s changed the city.  And we‘re looking at one of the most beautiful places in New York—

I always say to people, come to Rockefeller Center if you want to feel the city, the metropolitan part of the city. 

How has the president done in protecting this city, since he took office and since he went through all this on 9/11? 

MCFARLAND:  I think the fact that we‘ve not had another terrorist incident is example number one.  The United States has not had a significant terrorist incident since September 11.  I give that—

MATTHEWS:  So what foiled the terrorists?

MCFARLAND:  I think a number of things have foiled it.  One,

particularly in New York, you just mentioned a minute going, Rudy Giuliani

well, Mayor Bloomberg has done a brilliant job.  When September 11 happened, he turned to the police department and he turned to Commissioner Kelly and he said, do whatever you have to do to make sure it doesn‘t happen again. 

MATTHEWS:  Mark, what do you think of my idea of taking the U.N., if it wants to expand—in fact, encourage it to expand—and put it down at World Trade Center, in the footprint, so that if they hit us again, they‘re hitting everybody? 

GREEN:  I like that idea.  But let me disagree—

MATTHEWS:  Hold the whole world hostage to our security—don‘t you think that‘s a good idea?

GREEN:  One second—let me just—

MATTHEWS:  If we‘re going to rebuild, why don‘t we put the U.N.—you guys have a problem, really, coming out against terrorism.  We‘ll put you in a situation where you face the terrorists head on. 

GREEN:  Chris—

MATTHEWS:  We‘re going to put you—

GREEN:  It‘s a good TV idea, but—

MATTHEWS:  Why isn‘t it a good idea in reality?

GREEN:  Symbolically it‘s a good idea, because they hit us there, and let the world come together there.  But I disagree on Bush and protecting New York.  It was eight years between the first and the second World Trade Center attacks.  As a New Yorker who saw the plane go into the World Trade Center on the day I had an election—of course I‘m relieved there no attack, but for four days of the Iraq war, we can inspect not 5 percent of all containers coming into this city, but 20 percent.  We could protect every airliner with antimissile devices.

So since terrorism around the world has tripled, I‘m not satisfied, oh, we haven‘t been hit in New York.  The war in Iraq has increased terrorism, isolated America.  We‘re spending it in the wrong place. 

MCFARLAND:  (INAUDIBLE) wait a minute.

MATTHEWS:  Who was president from ‘93 into 2001?  Who was president of the United States?

GREEN:  You know the answer.

MATTHEWS:  Bill Clinton.  Do you think he did a good job of stopping a second attack on the World Trade Center when he was president? 

GREEN:  We can‘t know whether he stopped it.  Richard Clark—

MATTHEWS:  We know he didn‘t stop it.

GREEN:  Richard Clark‘s book said that Clinton was on the case on terrorism.  Sandy Berger said, when he briefed Condoleezza Rice, he said your number one issue will be terrorism—

MCFARLAND:  Tell that to 2000 people who died. 

GREEN:  And Condoleezza Rice then focused on an ABM treaty.  They blew it on terrorism, according to Richard Clarke.

MATTHEWS:  What do you think?

MCFARLAND:  Well, I think that, you know, all of this is very interesting, but the root of the problem is that the United States is funding both sides in the war on terror, and until we have a national energy policy that gets us off the addiction of Middle East oil, we are going to have these problems again and again and again.  We‘re sending American dollars to Saudi Arabia to fund madrassas which train terrorists.  We‘re sending American petro dollars to Iraq...

MATTHEWS:  What do you make of the fact we‘re sending—we‘re helping Israel with the most advanced missiles, we‘re sending them over there?  At the same time, we‘re sending relief supplies to Lebanon, where those missiles are hitting?  Isn‘t that strange? 

MCFARLAND:  No, it‘s not.  America stands shoulder to shoulder...

MATTHEWS:  Why isn‘t it strange? 

MCFARLAND:  ... with Israel.

MATTHEWS:  But doesn‘t it seem odd that we‘re offering relief supplies to the people hit by the missiles we send over? 

MCFARLAND:  No.

MATTHEWS:  I‘m just talking about the ironies of war here.  You don‘t see that as an irony?

MCFARLAND:  I think it‘s wonderful the United States...

MATTHEWS:  Mark, isn‘t that an irony?

GREEN:  I agree.  It‘s an irony of war, but when you‘re in war and there‘s civilian casualties, of course you help the Red Cross, of course you help with supplies for the people who didn‘t start it, want to end it, and are innocent bystanders. 

MATTHEWS:  Let me ask you about your party, your political party.  Who should they nominate for president next time? 

GREEN:  If you‘re not in it, either Hillary or John Kerry.  I like them both.

MATTHEWS:  How about if I‘m in it? 

GREEN:  Guys with blond and gray hair should always run. 

MCFARLAND:  I thought you were a Republican. 

MATTHEWS:  Pardon me?

MCFARLAND:  I thought you were a Republican.

MATTHEWS:  You can—I love the confusion here, because it‘s part of my vocation to keep people confused. 

Let me ask you, do you believe that your party will run Rudy Giuliani or John McCain? 

MCFARLAND:  I think either one, and either one would be great.  I know them both, and they‘re both great candidates. 

MATTHEWS:  Will your party be held hostage by the Southern Christian conservatives who have litmus tests on abortion rights, marriage definitions and that sort of thing? 

MCFARLAND:  No.  I think that right now, the single most important issue on everybody‘s mind is national security, terrorism, and homeland security, and I think both Rudy Giuliani or John McCain would be excellent choices for that. 

MATTHEWS:  Is this going to be a race between Hillary—or has she got it locked?  

GREEN:  She doesn‘t have it locked.  One thing I‘ve learned is I‘m a favorite who couldn‘t lose, who did, and an underdog who couldn‘t win one and did.  And what I worry about is the Republican Party is so in the thrall of the religious right that President Bush has to ignore science and hurt—my grandfather died of Parkinson‘s.  I don‘t want other people dying of Parkinson‘s because he won‘t fund stem cell research, because James Dobson won‘t let him. 

MATTHEWS:  So you think the Republicans are a theocracy.

MCFARLAND:  Wait, wait, Republicans also...

GREEN:  It is a theocracy.  And McCain and Giuliani are very talented public people.  If they can be independent of the religious right—and there‘s not much evidence now that John McCain, who went to Jerry Falwell‘s, an angel of intolerance—an agent of intolerance, and now he joined with him—if they can be independent of that, then they can be competitive in a general election. 

MATTHEWS:  Al Sharpton just endorsed Ned Lamont up in Connecticut. 

Will he have an influence in that race? 

GREEN:  Probably not.  He‘s not from Connecticut.  He‘s famous (inaudible), but that‘s a local race turning on Iraq and Lieberman‘s Democratic credentials. 

MATTHEWS:  Do you agree with me that if he—if Sharpton had a really top quality education, he would have been an amazing figure in American politics? 

MCFARLAND:  I think he already is an amazing figure. 

MATTHEWS:  Don‘t you think?  Beyond what he‘s been able to do?  I think he‘s been held back.  That guy is the smartest...

MCFARLAND:  He is very smart. 

MATTHEWS:  The smartest person we have on this show.  Most times, he stands out intellectually from most people. 

K.T. McFarland, Mark Green, showing amazing, amazing intelligence here on Rockefeller Plaza.  When we come back, we‘re going to talk to the crowd here and see how they can stand up against them at Rockefeller Plaza.  Rockefeller Plaza.  This is HARDBALL, only on MSNBC.

(COMMERCIAL BREAK)

MATTHEWS:  We‘re celebrating the 10th anniversary of MSNBC.com.  Live from the plaza at Rockefeller Center, we‘ll be back with the Hardballers.

(COMMERCIAL BREAK)

MATTHEWS:  (inaudible) the Battery from the top of the rock.  That‘s where we‘re going to be tonight for the celebration of MSNBC.com, which has been incredibly successful. 

Let‘s get some more questions for our guests.  Question, sir?

UNIDENTIFIED MALE:  Hi.  Do you believe that Israel has been too aggressive with their attacks on Hezbollah? 

MATTHEWS:  K.T.?

MCFARLAND:  Absolutely not.  Israel has the right to defend itself. 

Hezbollah has attacked Israel.  Hezbollah has attacked Israel before.  Hezbollah has murdered American Marines.  No, I think Israel has the right to defend itself and to have a sustainable peace. 

MATTHEWS:  If you didn‘t think so, would you say so? 

MCFARLAND:  Look, I say the truth. 

MATTHEWS:  OK.  Next question. 

UNIDENTIFIED MALE:  I am surprised to hear that, since Israel is the occupier, and the Lebanese and the Palestinians have all the right to defend themselves against the occupiers. 

GREEN:  One second, one second.  The occupier?  Israel did occupy south Lebanon for 20 years, foolishly.  They withdraw.  Israel was in the Gaza Strip to protect itself.  It withdrew, unilaterally, without asking anything.  What did it get in response?  Kidnappings, Katyushas and killings.

So when you say occupy, Israel, you would agree, responded to the kidnappings, unprovoked, of its soldiers three weeks ago. 

I‘ll tell you, if Canada had kidnapped New York City cops and they were shooting missiles into Rockefeller Center, Michael Bloomberg and George W. Bush wouldn‘t say, restrain yourselves.  Excuse me.  They are in hot pursuit of people who are killing them, and when Hezbollah disarms and Lebanon has a government that can enforce the law, this will stop. 

MCFARLAND:  Yes, and Hezbollah is the occupying country.  This is the occupying force.  It‘s a subnational force.  It‘s occupying the land of Lebanon.  The Lebanese government isn‘t in favor of Hezbollah. 

MATTHEWS:  Next question.

UNIDENTIFIED FEMALE:  My question is, in terms of the way the news is contextualizing both of these issues, what do you think is lacking, particularly maybe with some of the social programs Hezbollah sometimes has focused on?  What is the way...

MCFARLAND:  I think the important thing to remember is that groups like Hezbollah, whether it‘s Hezbollah, Hamas, al Qaeda, the Iraqi militias, they‘re funded by petro dollars.  These are American dollars that are sent to the Middle East to buy oil, that in turn are recycled into terrorism.  So the whole point of—you know, these are minor details compared to the more fundamental detail, which is we‘ve got to get off the addiction to Middle Eastern oil. 

MATTHEWS:  But her point is that the reason Hezbollah is popular among the Shia in Lebanon is because, what? 

UNIDENTIFIED FEMALE:  Right.  Because their social programs...

MCFARLAND:  They‘re providing the social programs.  But the other point is that Hezbollah is hiding behind women and children in south Lebanon.  They‘re standing with the civilian population.  That‘s why there are civilian casualties. 

GREEN:  One thing—I agree with K.T. on that.  One other element:

They hate Jews more, and in some parts of the world, certainly in the Middle East, if there is a terrorist group who says not let‘s negotiate with Israel, but we‘re going to eliminate Israel and we hate Jews, there is a certain popularity in that. 

The other contextualization, we went to war in Iraq for reasons that were since discredited.  Finally the president said for democracy.  Now there‘s more war and less democracy and more terrorism in the Middle East and because our soldiers are occupying, we‘re losing blood and treasure and we don‘t have any real relations with Iran and Syria, whatever our petro-dollar situation is.  We have very little leverage there because of Bush‘s fiasco in foreign policy.

MATTHEWS:  Let‘s get one more question in.

UNIDENTIFIED MALE:  What is America planning to do on this issue? 

When is it going to get involved?

GREEN:  America apparently is involved.

UNIDENTIFIED MALE:  Militarily.

GREEN:  If we use our troops in the Middle East?

UNIDENTIFIED FEMALE:  It‘s not—it‘s a global war.  It‘s not just Israel against a terrorist group.  It‘s democracy against the extreme Islam terrorists?

GREEN:  I agree it is a kind of World War III. 

UNIDENTIFIED FEMALE:  It‘s a world war.

GREEN:  It would have been conceivable for the U.N. to be in south Lebanon with the Americans providing part of an international force, but now that we are rotating people back to Iraq who haven‘t seen their families in two years, we are running out of men and firepower.  We have next to no leverage for people to have any serious say, other than our moral style.

MCFARLAND:  The United States is the only country that all sides will talk to.  The United States is not going to participate in a peacekeeping force, it wouldn‘t be an acceptable solution to any of the sides.  United Nations force, multinational force or a NATO force.  The United States is the only country that can play.

UNIDENTIFIED FEMALE:  They can speak to Syria, start speaking, because they‘re the only ones that can speak to Syria.  Israel will not speak to Syria.

MCFARLAND:  We found this out in 1973, I worked for Henry Kissinger.  After the October war in ‘73, Kissinger went to the Middle East, he conducted shuttle diplomacy between Israel and Egypt, Israel and Syria, Israel and Saudi Arabia, Israel and Jordan, that‘s probably what needs to happen here.

UNIDENTIFIED FEMALE:  Right, I agree, thank you.

MATTHEWS:  Mark Green and K.T. McFarland are going to stay with us.  We‘re going to take more questions from the crowd.  This is a really good cross-section of the world.  We‘ll be right back from Rockefeller Plaza in New York.

(COMMERCIAL BREAK)

MATTHEWS:  We are back from Rockefeller Plaza in New York with Mark Green, who‘s running for attorney general of New York against Mario Cuomo‘s  son Andrew.  I‘ll pay for that one.  And K.T. McFarland who has the inimitable task of taking on Hillary Clinton in New York this November.

MCFARLAND:  We want to go at it.

MATTHEWS:  You‘re the Republican nominee, right, you got it?

MCFARLAND:  No, I have a primary in September.

MATTHEWS:  Oh, that‘s right.  Well let‘s ask a question.  I want everybody to think for three seconds and then answer this question.  Was it smart for the United States of America to invade Iraq in 2003?  Doesn‘t anybody think so?  Here‘s a guy.  Why was it smart?

UNIDENTIFIED MALE:  I think because you‘re going to have to take care of the issues in the Middle East sooner or later.  The sooner that Iran comes up with the big bomb, you‘re in deeper trouble.

MATTHEWS:  Should we invade Iran?

UNIDENTIFIED MALE:  Well, you‘ve got to take care of Iraq first.  We took care of Saddam.

MCFARLAND:  But you know, the point is, and it‘s an interesting commentary on everybody.  The point is not would have, could have, should have.  You know, we‘re there.  You can‘t undue the past, whatever you might feel.  The important thing is what do you do next?  Don‘t argue—we‘ll have plenty of time to find blame, and—but what do you do next?  So I think what you do next is you have to have a national energy policy, immediately, have a Manhattan project to develop energy, alternative energy sources, conserve energy, look at nuclear power again maybe and have alternate energy sources.

MATTHEWS:  Mark, what‘s your view of this issue?

GREEN:  Love your energy plan, we agree.  It‘s not going to do anything in Iraq.  When you are in a hole, stop digging.  And at the moment, American soldiers, as well-intentioned and heroic as they are, are targets and are provoking the insurgency.  By the way, I want America to prevail, but if we had another country here telling us what to do, there would be an insurgency in America.  The sooner we get out, the war will...

MCFARLAND:  ... the sooner we get out.  Now, I disagree.

GREEN:  The sooner we get out, there will—since terrorism has increased because we went in, and since we don‘t have the material to do anything with Iran or Syria, because we are tied down in Iraq, this war should end as soon as possible.  It was a fiasco to go in and the sooner it‘s over, the better.  I‘m sure you agree with that.

MCFARLAND:  Look, you pull out tomorrow, and what happens next?

GREEN:  Tomorrow?  Who said tomorrow?

MCFARLAND:  Well, you‘re saying today.

GREEN:  I said as soon as possible.

MCFARLAND:  What happens next?  The United States gets out of the area, and there is a civil war in Iraq. 

GREEN:  There is one now, K.T.

MCFARLAND:  It will be a regional civil war.  It will involve Iran, or a country which has already declared an enemy of the United States, and Israel and talked about developing nuclear weapons.  It could pull Syria into it.  You could have a regional civil war with nuclear weapons thrown in the mix, and then what happens to Israel and what happened to energy?

GREEN:  Bush used the mushroom crowd fear to get us in.  It‘s not going to work right now.

MCFARLAND:  The one thing I‘ve learned in American history, don‘t believe politicians.  They‘ll tell you anything to get elected.

GREEN:  I just heard that.

MCFARLAND:  Believe a dictator.  If a dictator is telling you he is going to develop nuclear weapons, and he‘s going to try to obliterate the state of Israel, that‘s the guy that I believe.

MATTHEWS:  Do you believe, K.T., that going into Iraq, killing—well, 50,000 people have been killed in the war so far, 2,500 Americans have lost their lives, about 20,000 wounded, some of them very seriously.  Do you think that was worth going into Iraq, looking backwards?  Looking backward now?  I just had a simple question.

MCFARLAND:  Nobody feels more strongly about—I have a daughter in the military who will be sent.

GREEN:  Answer his question.

MATTHEWS:  Why don‘t you answer my question?  People will say we were awful to go into World War II.

MCFARLAND:  It‘s a would have, could have, should have.

MATTHEWS:  People were very proud of the fact that we went into World War II.

MCFARLAND:  Look, we can debate that or we can debate what is next.

MATTHEWS:  Why are you trying to—if you go see a movie and it‘s absolutely terrible and somebody says, oh that guy who made that movie wants to make another one, you want to come?  Would you go?  Doesn‘t it matter the policy success?

MCFARLAND:  I‘m doing a campaign, I‘m not watching a movie.

MATTHEWS:  Don‘t you think the policy success...

MCFARLAND:  ... Look, there were mistakes made.

MATTHEWS:  OK, I think that‘s—wait a minute, where‘s that girl back here?  Just a minute.  Who‘s that girl that was up here with the flags?  Anyway, I loved her up there.  Anyway, thank you.  We‘ll be right back in an hour with more HARDBALL from Rockefeller Center in New York.

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

END   

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