updated 8/30/2006 11:08:57 AM ET 2006-08-30T15:08:57

Guests: Mary Landrieu, David Vitter, Thad Allen, Douglas Brinkley, Al Sharpton, Jim Gilmore

NORAH O‘DONNELL, MSNBC HOST:  The floodwaters have dried, but Katrina still evokes torrents of emotion.  One year later, will Katrina be a factor, come election time?  Let‘s play HARDBALL.

Good evening, I‘m Norah O‘Donnell in for Chris Matthews.  Tonight, all eyes are on the Katrina-ravaged Gulf Coast.  One year later, how far have we come, and have we come far enough?  Have our leaders been held to account, and are we ready for the next natural disaster? 

Today President Bush continued touring the region, meeting with local residents and volunteer workers, a reminder that the hurricane is a human story, but it‘s also a political one. 

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES:  I take full responsibility for the federal government‘s response.  And a year ago, I made a pledge that we will learn the lessons of Katrina, and that we will do what it takes to help you recover. 

(APPLAUSE)

O‘DONNELL:  At issue, will the images of desperate, helpless Americans come back to haunt the president come election time this fall?  A new Associated Press poll shows that 67 percent of Americans disapprove of how George Bush handled Katrina, and a majority believe the country is still not ready for another major disaster. 

Tonight, we‘ll play HARDBALL with leaders from New Orleans.  Plus, author Doug Brinkley, whose book “The Great Deluge” takes an unsparing look at the Katrina response.  And we‘ll dig into the latest on Iraq and the November elections with the HARDBALLers.

But we begin with President Bush in New Orleans, where he sat down with NBC News nightly anchor Brian Williams and they talked about the president and the government‘s response to Hurricane Katrina. 

(BEGIN VIDEO CLIP)

BRIAN WILLIAMS, NBC NEWS:  You could not have been more contrite, as you were in today‘s remarks, that the government at all levels fell short of its responsibilities.  You have apologized for the damage, but what about the damage to your presidency? 

And, Mr. President, here is what I mean.  Most of the analysts call it your low point.  A lot of Americans are always going to believe that that weekend, that week, you were watching something on television other than what they were seeing.  And Professor Dyson from the University of Pennsylvania said on our broadcast last night it was because of your patrician upbringing, that it‘s a classic. 

BUSH:  Dyson doesn‘t know—I don‘t know Dyson and Dyson doesn‘t know me, but I will tell you this.  When it‘s all said and done, the people down here know that I stood in Jackson Square and I said we‘re going to help you, and we delivered.  And that‘s what matters, Brian, is that we helped the good people here rebuild New Orleans and the Gulf coast of Mississippi, and we‘re going to do that. 

You know, commitments in politics sometimes mean nothing.  I made a commitment that means something, and that‘s what‘s going to happen.  And, look, I understand people are second-guessing decisions, and Professor Dysons of the world say things. 

My heart and my soul is to help these people, and they know it.  And they understand that when the federal government makes a commitment, it‘s part of a renewal process, and that‘s what we need to be focused on.  How do we help people rebuild?  It‘s an important part of out country, and I‘m confident we will rebuild this part of the country. 

WILLIAMS:  What about what happened here would you like to have back in retrospect? 

BUSH:  You know, I think we should have better coordination with the state and local government.  There was—the enormity of the storm just overwhelmed all aspects of government, and I believe had we been better coordinated, communicated better, moved equipment better, coordinated better on who is responsible for troops, we could have done a better job. 

Having said all of that, the response was pretty remarkable, and I admit there was failures, but also one of the things I hope the people of America realize is there were great successes, like the Coast Guard pilots that flew endless hours to pull people off roofs, or the Louisiana Guard that, you know, moved in.  I mean, there were neighbors helping neighbors, or the Cajun Navy, these fishermen and folks down from the Bayou who pulled people out. 

And so, yes, things could have been better, but what I don‘t want people to do is overlook the great heroism of the local citizenry.  Really, they really did a remarkable job. 

(END VIDEO CLIP)

O‘DONNELL:  That was part of Brian Williams‘ exclusive interview with President Bush.  And there will be more of that interview be on “NBC Nightly News” tonight. 

And so we‘re joined now by both senators from Louisiana, Republican David Vitter and Democrat Mary Landrieu.  Senators, thank you very much for joining us.

SEN. MARY LANDRIEU (D), LOUISIANA:  Thank you. 

SEN. DAVID VITTER ®, LOUISIANA:  Thank you, Norah.

O‘DONNELL:  I want to begin with Senator Landrieu.  You heard the president there.  Are you getting everything you need from President Bush and the federal government? 

LANDRIEU:  No, absolutely not.  Now, I do know that the president is sincere in wanting to help.  In his speech today, he hit so many points that our delegation has been trying to bring home.  We need offshore revenue sharing to secure our coastline and build our levees.  We need a new school system for New Orleans, and to strengthen the schools that were ruined throughout the Gulf Coast, and he talked about infrastructure.

But, Norah, the bottom line is that the federal bureaucracies that exist today are not sufficient in any way to deal with the catastrophic situation that occurred here.  And it‘s not just the hurricanes, Katrina and Rita.  It‘s the flooding that ensued when the federal levee system broke, collapsed, and left this region under anywhere from 10 to 18 feet of water, depending on where you were on that day. 

O‘DONNELL:  Let me turn this then to you, to Senator Vitter, the question about the levees.  Are the levees ready for another hurricane?  We have heard from the chief of the U.S. Army Corps of Engineers.  He‘s not sure they are ready, despite hundreds of millions of dollars being spent to repair them and get them ready. 

VITTER:  Well, they are much better than they were the day before Katrina, but that‘s not good enough, and we have still a long way to go.  We have appropriated, through the Congress, about $7 billion in terms of emergency repair work for southeast Louisiana, but only 20 percent of that is spent.  More work is being done on the ground, so we have much further to go.  Is it better than it was the day before Katrina?  Yes. 

Is it good enough?  Not yet by a long shot and that‘s the biggest area where the federal government still needs to focus.  But, of course, we had shortages at the state and local level too, trying to address those situations as well so that we‘re all better prepared. 

O‘DONNELL:  I have to ask you, Senator Vitter and also Senator Landrieu, you know, it‘s a year later and the levees still aren‘t ready yet?  I mean, both of you criticized the federal government and FEMA for not being quick enough to respond this disaster.  You represent that state.  How can you go back to look at those you represent and say, you know what? 

We‘re still not safe a year later—Senator Landrieu. 

LANDRIEU:  Well, Norah, let me begin.  I‘m an appropriator for the levees, and Senator Vitter is an authorizer.  So we‘ve been working on this very hard all year.  The fact is, we have made a lot of progress, but as Senator Vitter said, not enough. 

The Corps of Engineers a very bureaucratic, top-heavy organization that needs fundamental change, and that‘s what our message is to Congress.  We cannot go through what we went through again, and God help anybody else that has to go through what we went through. 

So we have some new ideas that Senator Vitter and I are presenting to Congress to bring more private sector involvement, make it less bureaucratic, more entrepreneurial.  I hope we can succeed.  Maybe Senator Vitter can add something to that. 

O‘DONNELL:  Senator Vitter ...

VITTER:  Norah, I certainly take this very seriously.  I live here in the area, so my one-story home is protected by these levees, so I take it deadly seriously, and we have a lot more work to do. 

You know, there are two categories, I think, that we can look to.  There are legitimate factors in terms of why we‘re not complete yet, namely, that we‘re trying to do about 10 years‘ work in one year, an unprecedented amount of work, $7 billion of work. 

But there‘s a whole other category which is the real shortcomings and failures of the Corps.  And the Corps is a dysfunctional agency in many ways, and we need fundamental reform.  I have introduced legislation about that, and got in included in the word of bill, but we need to enact that and truly reform the Corps in some pretty fundamental ways. 

O‘DONNELL:  Senator, I think that many people look at—you just mentioned $7 billion in taxpayer money to rebuild the levees, $110 billion altogether to the Gulf states.  That‘s what President Bush has been touting, the amount of money that‘s in the pipeline headed to the Gulf states.  About half of that has been spent, about $17 billion has gone to insurance companies.  How much of that is actually getting to the people who don‘t have homes? 

VITTER:  Well, only about 40 percent of that total figure has hit on the ground, and a lot of that, quite frankly, has been wasted through no-bid federal government contracts and other things.  So we have a lot further to go.  A lot of it is still stuck in the bureaucratic pipeline, including at the state level. 

So we need to push that through the pipeline and make sure it shows up here on the ground in the most devastated neighborhoods.  That‘s a big part of the challenge now, not just passing the money, but getting it here, making it work. 

O‘DONNELL:  But, Senator, with all due respect, that‘s your job.  You are the senator.  You‘re in Congress, the oversight.  Why aren‘t you pushing to do that?  And I‘ll ask the same question to Senator Landrieu when you‘re done.  I mean, it seems to me that they are not doing this, there‘s a lot of bureaucracy in the Army Corps of Engineers, yes, there‘s a lot of waste.  What are you doing to make sure that that stops? 

VITTER:  Well, Norah, on the Corps side, because that‘s a big focus of activity, I‘m on the phone in conference calls and meeting with the corps, literally two or three times a week on some level, pushing, pulling, demanding, yelling, to get this stuff done.  And I‘ve been at it as Mary Landrieu has since Katrina.  So you‘re right.  It‘s a big part of our job, and that‘s why we‘re spending an enormous amount of time trying to change the situation and get it done.

LANDRIEU:  But, Norah let me be clear here—let me just be clear about something.  The Corps of Engineers does not answer to us on a day-to-day basis.  They are an executive agency that answers to the president.

Yes, we have oversight.  We‘ve had hearing after hearing.  We‘ve done study after study and shown the problems and offered solutions, but ultimately, it gets down to this.  Does the federal government want to be ready for a major catastrophe or not?  We‘re not ready today, we weren‘t ready a year ago.  Now we need a better corps, a better FEMA and a better SBA and I could go on and on.

Now we‘ve passed some bills in Congress, but it‘s not enough, and so I hope the president‘s legacy will be that he, as he said today, recognizes the failings and will spend the next two years of his administration fixing it.  Meanwhile, here at home, we‘re fixing our own back yard.  We‘ve consolidated some of our levee boards, we‘re streamlining some of our operations.  And we must ask the federal government again to share those revenues that they are pouring in from our hard-working people and let us build some of our own levees, and we‘ll stop relying them so much and we can rely on ourselves.

O‘DONNELL:  All right, Senators Landrieu and Vitter, they are staying with us.  And later, the man who replaced Brownie nearly one year ago, U.S.  Coast Guard Commandant Thad Allen talks about the recovery and how prepared we are today.  You‘re watching HARDBALL, only on MSNBC. 

(COMMERCIAL BREAK)

O‘DONNELL:  Welcome back to HARDBALL.  We are back with Louisiana Senators Mary Landrieu and David Vitter. 

Let me begin by talking about some statistics one year later.  Half of the schools are still closed.  Only three out of the 10 hospitals are open.  Estimates that 60 percent of small businesses that were there previous to Katrina are open.  And only half of the population has moved back to New Orleans.  Senator Landrieu, is part of the problem that the Democratic mayor, Ray Nagin, has still not yet put together a blueprint for the city one year later?

LANDRIEU:  Well, there is no—there‘s no excuse, if you will, for the lack of organization here on the ground.  But let me be clear, St.  Bernard Parish, which is just south of New Orleans, that lost 100 percent of their homes and 100 percent of their people, less than 20 percent of the people are back.  And St. Bernard has been working awfully hard. 

So is St. Tammany.  Again, the magnitude of this destruction was unprecedented.  That‘s no excuse for the lack of local leadership that we have seen displayed.  But the fact of the matter is when we rebuild the school system, we obviously are not going to waste the taxpayer money by building the same old tired school system we had.  We‘re going to build the finest urban public school system in America.  And so we‘re not taking our time, but we‘re doing it carefully.  We want people to come back, but they need schools, they need clinics, hospitals, and the small businesses—

20,000 were lost, and the SBA has been extremely slow to help, so many business owners are on their own.

O‘DONNELL:  Senator Vitter, you are a member of the Republican Party and the former speaker of the house, Newt Gingrich, said the incompetence and the bureaucratic bungling after Katrina raised real questions about the Republican Party on issues of leadership and confidence and that that may hurt them in November.  Do you believe that the response endangers your party, come November?

VITTER:  Well first of all, Norah, quite frankly, I don‘t know and I don‘t care.  I‘m focused on the substance of this story, not the politics of the story and if everybody in Washington did the same, we would be a lot better off and a lot further along.  But certainly this whole episode for the last year has proven real shortcomings and real incompetence at every level of government, federal, state, and local as the president I think very directly said today.  And that‘s absolutely true, and that continues to be true to some extent in the recovery.  And we absolutely have problems and challenges, federal, state, local.

O‘DONNELL:  And let me get a quick response from each of you because many people look at the response to Katrina and ask the question, if this is how our government responded to a natural disaster, is our government ready to respond to a disaster brought by a terrorist attack.  Senator Landrieu?

LANDRIEU:  I don‘t believe we‘re ready.  No, I believe our military is ready, but I don‘t believe and I think the evidence shows that this country generally is not ready to take care of a large dispersal of civilian population.

We have three million people on the run at one time looking for a safe place, people that are looking for housing immediately.  We‘ve got a lot of work to do from communications systems to better housing plans.  And the government must work better so the private sector can step up in the faith-based community can be a help as well when the government helps to lead and stops getting in the way.

O‘DONNELL:  Quickly, Senator Vitter.

VITTER:  We certainly have more to do, absolutely, Norah, and we have more to improve.  Only one correction I would make in terms of what this, it‘s a natural disaster and a man-made disaster, because so much of our devastation was caused by the levee breaches, which was man made, engineering mistakes.

O‘DONNELL:  Thank you very much to Senator Landrieu and Senator Vitter, a Republican and a Democrat working hand in hand on this particular issue.  Thank you to both of you.  I appreciate it.

VITTER:  Thank you.

O‘DONNELL:  Thad Allan, the commandant of the U.S. Coast Guard talks to us from New Orleans about the recovery effort.  Are things moving too slowly?  You‘re watching HARDBALL only on MSNBC.

(COMMERCIAL BREAK)

O‘DONNELL:  Welcome back to HARDBALL.  When FEMA director Mike Brown was ousted last year as the top federal official overseeing the Katrina disaster efforts, he was replaced by Thad Allen, who was then the chief of staff of the Coast Guard.  Today he‘s the commandant of the U.S. Coast Guard, and he joins us from New Orleans.  Admiral, good to see you.

THAD ALLEN, COMMANDANT, U.S. COAST GUARD:  Hi, Norah.

O‘DONNELL:  Has the progress been slower and much harder than you expected and why?

ALLEN:  Well I think the progress has been harder for everybody that‘s been involved: federal, state, or local.  I think we need to remember this is an event that‘s completely off the scope or the scale of anybody‘s experience level and quite frankly, a disaster of epic proportions in the country.  So it‘s going to take some time I think the debris removal was frankly was pacing everything else and that appears to be almost done in Mississippi and a good ways along now in Louisiana.

O‘DONNELL:  One year later, polls show that American people think that the federal government has not learned from the bureaucratic bungling of Hurricane Katrina.  Former FEMA director Mike Brown was on the “Today” show this morning and this is what he had to say.

(BEGIN VIDEO CLIP)

MATT LAUER, CO-HOST, TODAY:  This is the anniversary of the day Katrina struck the Gulf Coast.  So a year ago today, were you confident as that storm approached that the federal government‘s plan was adequate to deal with anything that storm could deliver? 

MIKE BROWN, FORMER FEMA DIRECTOR:  What plan?  There wasn‘t a plan. 

(END VIDEO CLIP)

O‘DONNELL:  Admiral, is that true?  Was there no plan and is there a plan today?

ALLEN:  Well I think there was a plan before.  I don‘t think it had been practiced well enough, and I don‘t think we believed ourselves, especially after the exercises we learned in the hurricane exercise which preceded Hurricane Katrina.  I can tell you that the cooperation and the level of preparedness this year is unprecedented compared to any of my 35 years in the Coast Guard. 

Our cooperation between the Coast Guard and FEMA has never been better.  We are doing probably over 300 percent more exercises in advance of this hurricane season than we have ever done before.  And the predesignated principal federal officials that—the function that I performed last year at Katrina, we‘ve identified those folks for every region in the country and they‘ve actually trained and exercised with their FEMA counterparts.  There‘s no doubt we‘re better prepared.

O‘DONNELL:  So are the levees ready in case another hurricane strikes in New Orleans?

ALLEN:  Well Norah I‘m not technically competent to talk about the levees.  I do know there‘s been extensive work done on them.  There are over 300 miles of levee systems here that have been worked on by the Corps of Engineers.  I did have an opportunity to fly over the city yesterday as we came in with the president and just from my own personal observations, the amount of work that‘s been done on the levees is significant, especially the creation of the pumping station and the gates at the mouth of the Lake Pontchartrain, where the canals lead out of New Orleans and that is a significant improvement.

O‘DONNELL:  Of course, the chief the U.S. Army Corps of Engineers says it‘s not clear whether the levees would withstand a hurricane.  Senator Mary Landrieu, the democrat from that state, she says they could deal with a Category Three, but not a Category Five hurricane.  The New Orleans paper says today that $352 million has been spent reinforcing, repairing these levees, and yet they are still not ready.  How could that be one year later?

ALLEN:  Well, again, I would defer a technical answer on that to the Corps of Engineers.  We do know there has been a lot of work done on those levees.  I have been down here several times.  They have worked nonstop since last year.  But as far as the technical performance of the levees, I would have to defer to the corps on that.

O‘DONNELL:  Let me ask you admiral, because you gave a speech earlier this year that I took note of where you said that you thought that Katrina was a hybrid event between a natural disaster and what would be a terrorist strike.  What did you mean by that? 

ALLEN:  Norah, what I meant was.  And again, this goes back to the scale and the scope of this event.  This went well beyond what would have been a devastating hurricane, when have you problems with the levee breaches and the flooding of the city. 

What I‘ve told everybody is this is like a combination of a hurricane, a large hurricane hitting a part of the coastline and then the flooding associated with the levees was like a weapon of mass effect but without criminality visited on the city of New Orleans. 

And what happened as a result of that, you lost continuity of government and in some cases, civil society, where there was no command and control communication for first responders to use and that really created a kind of a job description that I had when I walked into the event.

O‘DONNELL:  Well admiral, that‘s why many people looked at New Orleans not only as the greatest natural disaster perhaps in American history that left and killed thousands and ruined the lives of tens of thousands more, but also the government response and had there been a terrorist attack that the government could not adequately deal with getting resources to American citizens. 

Is that one of your greatest concerns?  And how can you ensure the American people that steps have been taken by the Coast Guard, by others in the government to make sure those have been corrected? 

ALLEN:  Well, it‘s an excellent point, Norah.  I think what happened during Katrina was I don‘t think everybody adequately understood that there was not command and control or infrastructure available in and around New Orleans to take the resources that were flown in and apply those to what I would call mission effect.

For instance, we had a large number of urban search and rescue teams from FEMA.  We had disaster medical assist teams that had all been sent into the city.  But without command and control, the first responders in and around New Orleans are incapable of applying those resources.

When I got to Baton Rouge a week after the event and we went down to New Orleans, it was clear to me that somebody had to take control of those assets and apply them and direct them where they needed to go.  I think early recognition that we were beyond a normal event where local responders could take those resources was probably something that was missed and that‘s how I identified my job description when I got here.

O‘DONNELL:  Admiral, one of the reasons the president chose you to replace Mike Brown, or Brownie, as the president called him, was  because the Coast Guard was the only federal agency to be providing significant support during the first week of the storm.  Many people have argued and even Mike Brown has argued that one of the reasons FEMA couldn‘t do its job because it was a bureaucratic nightmare, it was under the Department of Homeland Security—the Coast Guard is under the Department of Homeland Security.  How then did you manage to function?

ALLEN:  Well the Coast Guard has a long tradition of what we would call on-scene initiative.  And where our rescue units were cut off from command and control to their higher levels and echelons in command, they knew what to do and how to act on scene.

Plus, in advance of the storm through our preparation and training, we redeployed our aviation assets, were able to bring them in right after the storm and be apply to apply them to mission effect.  I think that is something that every agency can do.  They just need to learn and need to internalize it into the culture.  That‘s something that we in the Coast Guard have grown up with over 200 years of our history.

And I think it‘s something that homeland security is moving towards too.  I can tell you that the relationship between FEMA and the Coast Guard has never been better.  We are a better agency because we‘re in the Department of Homeland Security with FEMA, and I believe FEMA will be a better agency because they are in the Department of Homeland Security with the Coast Guard.

O‘DONNELL:  And quickly, admiral, let me ask you on a personal note about what it‘s like to be back in New Orleans.  You know, half of the New Orleans schools have been reopened.  Only 60 percent of the businesses are back.  One year later, only three of the 10 hospitals have been reopened.  What‘s it been like for you personally to see this?  Did you expect to see a lot to have happened in the past year?

ALLEN:  Well walking into the situation a year ago, it was heart-rendering and it was just devastation beyond anything I had ever seen and you‘re permanently marked by that for the rest of your life.  It was a similar event of my personal and professional career. 

Coming back, I think everybody would like to see more progress than there has been, but I think what we‘re understanding now is the true scope and scale of this event and first starting with the gating mechanism of having to get all the debris out of the way before you can do anything else was much, much more difficult than anybody had imagined.

O‘DONNELL:  Admiral Thad Allen, commandant of the U.S. Coast Guard, thank you for your time.

ALLEN:  Thank you.

O‘DONNELL:  And up next, MSNBC‘s Joe Scarborough and historian Doug Brinkley will talk about the politics of the recovery from the ground in Mississippi and Louisiana.  Has the effort moved too slowly? 

You‘re watching HARDBALL, only on MSNBC. 

(COMMERCIAL BREAK)

(MARKET REPORT)

(BEGIN VIDEO CLIP)

BUSH:  The city is a story of hope and dignity and perseverance.  And it‘s these qualities that have seen you through trials of war and prejudice and natural disaster. 

(END VIDEO CLIP)

O‘DONNELL:  Welcome back to HARDBALL.  That was President Bush speaking today, the first anniversary of Hurricane Katrina.  In what ways did the Katrina debacle affect Bush‘s presidency, and was Katrina a turning point for his administration? 

Presidential historian Douglas Brinkley is a resident of New Orleans. 

He is critical of President Bush in his recent book, “The Great Deluge: 

Hurricane Katrina, New Orleans and the Mississippi Gulf Coast.”  And Joe Scarborough is the host of “SCARBOROUGH COUNTRY,” and he joins us from Biloxi. 

Joe, let me begin with you.  You reported from there last year.  How much has changed? 

JOE SCARBOROUGH, HOST, “SCARBOROUGH COUNTRY”:  An awful lot has changed.  And the spirit of the people here is positive, a lot better than what you get in New Orleans.  They feel like their leaders have come together and successfully put together a reconstruction effort. 

A lot of the debris is gone.  You know, in Pensacola we got hit—my hometown, we got hit by Hurricane Ivan a couple of years ago.  You still have debris in places.  Here, they have done a pretty remarkable job of clearing the place up, cleaning it out.  That‘s the first thing you have to do.  Sometimes it takes years to do that after a Category 4 or 5 hurricane.  They have done it fairly quickly here. 

The Beau Rivage opened today.  That is the economic engine for this

area, a massive Last Vegas-style casino, and that actually fuels a lot of -

actually, it‘s ironic.  A lot of the people that I saw the first day that were on the streets here after Katrina that had absolutely no help at all, we were giving them water, giving them suntan lotion, giving them supplies for their babies, they told us that they worked at the Beau Rivage. 

So a positive attitude here.  Even with people—even with 100,000 people or so that have been living in FEMA trailers, we are getting positive responses from a lot of people we are running into. 

O‘DONNELL:  Doug, why is it that, in some ways, Mississippi has been able to rebuild more quickly or clear more quickly than New Orleans? 

DOUGLAS BRINKLEY, AUTHOR, “THE GREAT DELUGE”:  There are a few reasons.  One is leadership.  I think Governor Haley Barbour and Trent Lott, Thad Cochran, understood how to get money quickly, how to appropriate it.  And also, you have a lot of medium-sized towns on the Mississippi Gulf Coast, like Biloxi, Gulfport, Bay St. Louis, Waveland, and the spirit there has always been a little more optimistic. 

In New Orleans, you have this major urban center, and you‘ve got 80 percent of it flooded out, and you have entire neighborhoods that there‘s zero work being done, no rebuild in the Lower Ninth, or in New Orleans East.  So have you pockets—this sliver by the river where I‘m standing now—that are doing very well in New Orleans, but the whole area surrounding it doesn‘t look a whole lot different than it did a year ago. 

O‘DONNELL:  What is the biggest failure today?  There is plenty of money in the pipeline headed to both where Joe is in Mississippi, and where you are in New Orleans.  What is the biggest failure of the federal or local government today that New Orleans has not progressed further? 

BRINKLEY:  Well, we all know the federal government had a—did a terrible job a year ago, but the money has come down here slowly but surely.  The big problem is Mayor Ray Nagin.  He has no plan for New Orleans.  He think that that‘s OK to operate without a plan.  Everybody is begging for one, and he doesn‘t want to alienate any constituencies.  He is pandering to voters, he talks out of both sides of his mouth. 

And, for example, this weekend, he should have been on national TV talking about his city, and instead he was spending his time defending the foot in the mouth disease.  So Nagin is one of the real problems to development, in my opinion, in New Orleans. 

O‘DONNELL:  Joe, let‘s talk about the political fallout for the president and perhaps the Republican Party.  Newt Gingrich, of course—the former speaker of the House who was ushered in in the Republican revolution when you were elected to Congress—said that what Katrina did was raise real questions in the minds of American people about competence and leadership of the Republican Party.  Will that come back to bite them come November? 

SCARBOROUGH:  Oh, there‘s no doubt about it.  The Republicans have been elected for years, since 1968 and 1972, by pointing to the Democratic Party and saying, hey, maybe you like what they believe in more than you like what we believe in, but they aren‘t competent to run government.  They don‘t know how to make the trains run on time.  They don‘t know how to fight wars.  They don‘t know how to officially run cities. 

That myth was shattered last year.  I‘m always reminded of that “Simpsons” episode where Bart Simpson went to the Democratic National Convention and they unfurled a banner that said “we can‘t govern.”  And Republicans always laughed at that and said, you know, that‘s basically—you know, when Michael Dukakis in 1998 said “It‘s about competence, not ideology,” you‘re exactly right. 

And Democrats aren‘t competent to run government, that myth was shattered last year, certainly on the federal level when the Bush administration seemed it be out of it for the first 72 hours at least, and had such a slow reconstruction effort because of FEMA, or I suspect now more because of the Department of Homeland Security. 

So that has a lasting impact, and it‘s not just moderates and liberals who started feeling that way about the Bush administration.  Most damningly, it‘s a lot of conservatives who ...

O‘DONNELL:  Republicans.

SCARBOROUGH:  ...are embarrassed—and Republicans, saying that he looked like Jimmy Carter in those months after Katrina hit.  And you just can‘t insult a Republican in a worse way than comparing them to Jimmy Carter. 

O‘DONNELL:  Joe, you hit the nail on the head.  Because remember, the president‘s approval ratings were in about 40 percent range, and then Katrina struck, and the Brownie debacle, like you see Brownie now, then it dropped into the 30‘s, and he hasn‘t been able to recover since.

SCARBOROUGH:  And, Norah, what‘s—what‘s also...

O‘DONNELL:  And that was because of the Republican fallout there.

SCARBOROUGH:  Right.  And what‘s so important also is right after that, we had the Harriet Miers debacle, where remember George Bush said you‘ve got to trust me?  George Bush said that a week after he told the nation that Brownie was doing a good job. 

It shattered the confidence he had with his own conservative basis.  They jumped on him after Harriet Miers, that was a one-two punch that really destroyed him with his own base, undercut that support.  And that‘s when he got down into the low 30‘s. 

He‘s slowing building it back up.  But boy, that was a one-two punch, and it all went back to competence. 

O‘DONNELL:  Doug, as a historian here, how will Katrina affect this president‘s legacy, which in many ways is so defined by 9/11 to some degree which many people saw him as a strong leader and competent and that we haven‘t had a terrorist attack since 9/11 and yet there are questions about his leadership when it comes to Katrina?

BRINKLEY:  Well, I think someday when there is a Bush Presidential

Library probably at Southern Methodist University in Dallas, the Katrina

display is going to be very hard to sell visitors that President Bush acted

responsibly during Katrina.  There will be something about the Coast Guard

who did an incredible job, when the 82nd Airborne came in over a year ago -

you know, a year ago at this time, they did a good job. 

But what people will remember of President Bush is the Brownie, you‘ve did a heck of a job, the sound bite that will live forever.  And that photo of the president looking out of Air Force One detached.  He never put his boot heels on the ground, he never smelled the floodwaters during that week. 

Lyndon Johnson in 1965 when Betsy hit came to the 9th Ward, he went in  the dark of night, put a flash light on his face and said, I‘m your president, I‘m here, meaning I care about you.  President Bush never had those moments with Katrina.

My view of today is that the president is going around doing kind of the right things, but the G.O.P. wants to get Katrina behind them. 

When you mention the word Katrina does not help them for the ‘06 elections coming up.  It‘s one of those things better put out of mind, because the president has not scored particularly high marks down here on the reconstruction effort either. 

O‘DONNELL:  All right.  Douglas Brinkley, you know I asked Michael Brown about what you‘ve said, about that line is going to be the most famous line remembered in Katrina to Michael Brown today, and he said, yes, it‘s probably going to be carved on my gravestone. 

BRINKLEY:  He may be right about that. 

O‘DONNELL:  Yeah.  He may. 

And Joe Scarborough, I understand you‘ve got Haley Barbour tonight on your show, so we will be watching.  Thank you very much to both of you.

SCARBOROUGH:  Thank you so much, Norah. 

O‘DONNELL:  And up next, HARDBALLers, Al Sharpton and Jim Gilmore will battle over the politics of natural disaster and national security.  Can President Bush repair his image on the Gulf Coast.  This is HARDBALL only on MSNBC. 

(COMMERCIAL BREAK)

O‘DONNELL:  Welcome back to HARDBALL.  One year after Hurricane Katrina struck, is President Bush still suffering from the political fallout?  And what can he do to repair the political damage? 

(BEGIN VIDEOTAPE)

O‘DONNELL (voice-over):  Days after Hurricane Katrina struck, this was the scene on the ground in New Orleans. 

CROWD:  Help, help, help, help!

O‘DONNELL:  And this was America‘s first glimpse of President Bush, peering down at the destruction from thousands of feet above. 

EUGENE ROBINSON, WASHINGTON POST:  It‘s an image kind of, of impotence, and frankly, in imageness terms, of cluelessness. 

O‘DONNELL:  Five days later, while Americans watched images of suffering in New Orleans and distress at the city convention center, the president hit the ground...

BUSH:  And Brownie, you‘re doing a check heck of a job. 

O‘DONNELL:  ...praising then FEMA director Michael Brown.

Analyst say Katrina called into question the president competence as a leader and may yet hurt Republicans in the November elections.

ANDREW KOHUT, PEW RESEARCH CENTER:  It was the first time we had seen a sizable percentage of the Republican base saying they had doubts about the president‘s performance.

O‘DONNELL:  The White House says they‘ve issued $100 billion in storm relief.  And the president is marking the one-year anniversary in Mississippi and New Orleans. 

BUSH:  It‘s amazing what the world looked like then and what it looks like now. 

O‘DONNELL:  But now as the Gulf Coast struggles to rebuild, the president is still feeling the political damage from his administration‘s botched response to the worst natural disaster in American history. 

(END VIDEOTAPE)

O‘DONNELL:  It‘s time to dig into the difficult politics of Hurricane Katrina, the president, the war in Iraq and the upcoming November elections.  And so our HARDBALLers tonight are the Reverend Al Sharpton and Jim Gilmore, the former governor of Virginia and the former RNC chairman.  Thank you to both of us—to both of you for joining us today. 

Governor, let me ask you about that, the president‘s political standing has not recovered one year later from his administration‘s response to Katrina.  Why? 

JIM GILMORE, RNC CHAIRMAN:  Well, the president is facing a lot of challenges both overseas and at home.  He has got a lot of challenges he‘s trying to meet. 

But you know what Norah, what really counts here is the candidates themselves, both for the House and the Senate, they have to carry their own water, they have to carry their own programs. 

And I believe that as long as Republicans cater to where their strengths are, which is controlling spending, controlling making sure we don‘t have higher taxes, focusing on education, inclusion of people, then I think we‘re going to be OK.  I think they‘re going to be OK.  And that‘s the focus we‘re going to do, offer a positive program in the upcoming elections. 

O‘DONNELL:  Reverend Al Sharpton, your response to that? 

AL SHARPTON, NATIONAL ACTION NETWORK:  Well I think that clearly the president is continuing to suffer damage, and that is why I think many of the Republicans are moving away from him. 

I agree with Governor Gilmore that they will have to carry their own water.  And I think that they don‘t want to be seen as having taken that water from Lake George W. Bush, because people are not going to drink from that water. 

I think that clearly the Democrats will have to prove we‘re strong on national security, at the same time we will right the question that Iraq had nothing to do with it, and that we‘re not fiscally irresponsible.  And I think it is irresponsible to spend billions of dollars on a war that was built on a false premise and have infrastructural problems like you had here in New Orleans.

I think that the one thing that the Republican and Democratic leadership will agree to is to get away from George Bush in these mid-term elections.

O‘DONNELL:  There‘s a new Associated Press poll out today that shows that 67 percent disapprove of how the president handled Katrina, only 31 percent approve.  Plus 56 percent say they deeply feel that the country is not ready for another disaster.

Governor Gilmore, that‘s not a vote of confidence in the Republicans who govern here in Washington.

GILMORE:  Well Norah, I‘ve chaired the advisory commission on Homeland Security for the United States Congress for five years, starting in 1999, all the way up through 2003.  Now while I think a lot of progress is made, we‘re not really ready yet.  I Think a lot of work still needs to be done. 

But the main point is you have to have a partnership between federal, state, and local people, the private sector and community leaders.  That still remains to be done. 

Now, we still have that work ahead of us.  And a lot of more work still needs to be done on that. 

But to put it all on just one guy, on the president, I think is improper politics, it‘s playing games with national and homeland security.  We shouldn‘t be doing that. 

O‘DONNELL:  What about that, Reverend Al Sharpton?  You know, Mayor Nagin who was re-elected recently, a lot of people are blaming him.  Where is the blueprint for rebuilding New Orleans?  And the fact that he—some critics say he doesn‘t come up with this plan is slowing the recovery in New Orleans. 

SHARPTON:  First of all, I think Mayor Nagin has some blame.  He‘s even said that in terms of the immediate evacuation.  I think Governor Blanco does. 

The problem is, you can‘t have a partnership if it takes five days for one partner to show up.  I think the problem is that George Bush and his administration did not show up.  And the problem that that gives is even with Blanco making mistakes and even with Nagin making mistakes, they don‘t control a region, they are not the governor of three states or president of three states.  The mayor can‘t control Mississippi, Alabama and Louisiana. 

So you can‘t on one hand say yes, the city should do more, and then you have a regional crisis. 

The president said nothing for days, while Americans watched people drowning on their television sets.  Americans sat in their living room watching people on rooftops, holding up help us signs.  The president said nothing. 

So it‘s not like you‘re blaming one person.  He was the only one that didn‘t show up.  So you kind of miss the one that‘s absent in class if you are taking attendance. 

O‘DONNELL:  All right.  We‘re going to be back more with Al Sharpton and Jim Gilmore in just a moment.  Are you watching HARDBALL only on MSNBC. 

(COMMERCIAL BREAK)

O‘DONNELL:  We are back with Reverend Al Sharpton and Jim Gilmore. 

Now, while much of the attention has been focused on New Orleans and in Mississippi today, there is also news when it comes to Iraq.  Several officials over the past several days have been addressing the American Leagen in Salt Lake City. 

And let me just show you part of what Vice President Cheney has said and Secretary Rumsfeld.  Rumsfeld is now saying that those who critique the administration‘s war strategy are trying to essentially act like appeasement of the Nazis in the 1930s. 

(BEGIN VIDEO CLIP)

DICK CHENEY, VICE PRESIDENT OF THE UNITED STATES:  Precipitous withdrawal from Iraq would be a victory for the terrorists, an invitation for further violence against free nations and a ruinous blow to the future security of the United States. 

DONALD RUMSFELD, SECRETARY OF DEFENSE:  Indeed in the decades before World War II, a great many argued that the fascist threat was exaggerated, or that it was somebody‘s else‘s problem.  I recount that history, because once again we face similar challenges in efforts to confront the rising threat of a new type of fascism. 

(END VIDEO CLIP)

O‘DONNELL:  Reverend Sharpton, let me ask you to respond to that.  As Rumsfeld is saying the world faces, quote, “a new type of fascism,” those that critique the war strategy essentially are doing like what they tried to do in the ‘30‘s appeasing the Nazis, he says.  And that those critics are suffering from moral and intellectual confusion.  Your response? 

SHARPTON:  I think that that is way over the top.  I mean, it‘s almost insulting on the intelligence of the American people. 

First of all, the national security are those that attacked us, and those that attacked us was al Qaeda and Osama bin Laden, not those in Iraq.  Thos in Iraq clearly are not good guys, clearly they are people that I don‘t know anyone that supported.

But if we are talking about protecting ourselves from the threat, and those who in fact attacked us, Iraq was clearly not part of that.  There is no evidence that despite Rumsfeld‘s best eforts that connected them, why are we going after who was not going after us?  In World War II that was not the case. 

O‘DONNELL:  Let me ask Governor Gilmore about this.  Because it‘s an interesting change of rhetoric that the administration has been using.  They‘ve been talking about Islamic fascists.  And now, of course, Rumsfeld today saying this essentially this is like apeasing the Nazis in the 1930‘s.  Trying to set the war up on terror like the fight in World War II.

But it‘s the strangest of turns, because as I‘ve covered this administration, they‘ve always made the point, especially from the Pentagon, this is not a traditional enemy that we‘re fighting.  This is not enemy with an army, with a navy, with uniforms.  So is that an appropriate analogy to say that it‘s like fighting the Nazis?

GILMORE:  Well, you know Norah, I would say several things.  Number one, I would say we should agree that a pricipitous withdrawal would be injurious to the United States.  I think most people agree with that.

And second of all, I think that this is a complicated situation.  I think that this is a different kind of war.  We have always said that it was a different kind of war. 

And if I were at this point trying to fight facsists, I would want to make sure that we were intolerant of them and trying to kill them the way that we should be with al Qaeda, and at the same time drawing to us people who are willing to ally with us.  Which means that we have to have a military strategy, a diplomatic strategy and we have to capture the moral high ground everywhere.  And that‘s the challenge that we face.

O‘DONNELL:  The Democrats responded to this, saying that this was a political rant by Secretary Rumsfeld to you cover up the incompetence of this administration.  That‘s the word the Democrats are going to use all through the next several weeks.

GILMORE:  Well, they‘re using that world again.  But I think that the American people have expressed confidence in the Republican Party, because of it‘s background of working and meeting these kinds of changes.  And I think we are still working to do that.

But it is going to take a complicated view of the world.  And I believe that absolutely.

O‘DONNELL:  All right.  Well, President Bush is also going to address the American Legion later this week.  We‘ll be watching.

Thank you to Al Sharpton and Jim Gilmore.  Play HARDBALL with us again on Wednesday.

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

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