updated 10/30/2006 11:16:38 AM ET 2006-10-30T16:16:38

Guests: Ron Fournier, Steve Jarding, John Harwood, Chris Cillizza, Bob Kerrey

CHRIS MATTHEWS, HOST:  Dirt ball—desperate to survive, candidates do what works.  Dirt works. 

Let‘s play HARDBALL.  

Good evening.  I‘m Chris Matthews, and welcome to HARDBALL.

Does the end justify the means?  The negative ads being played across the country should be rated R, or even X.  The election swims in the gutter.  With only 11 days to go, don‘t believe what you see on television. 

A shift in power is what‘s at stake here.  Republicans currently control 55 seats in the Senate.  Democrats control 45.  If they pick up six new seats, they win control of the Senate.  If the Democrats pick up 15 seats in the House, they win control there. 

Today, the hot Senate race in Virginia just hot—just got hotter—well, maybe steamier. 

HARDBALL‘s David Shuster has this report. 

(BEGIN VIDEOTAPE)

DAVID SHUSTER, NBC CORRESPONDENT (voice-over):  Stuck in a dead heat in his Virginia race, and with just 11 days until the election, Republican incumbent George Allen is now accusing his Democratic opponent, Jim Webb, of demeaning women. 

Today, the Allen campaign distributed excerpts from novels Webb wrote more than 15 years ago.  As a Vietnam veteran, Webb‘s plotlines involve places and people torn apart by war.  But some of the passages include graphic descriptions of oral sex, incest, and sex between teenagers. 

The Allen campaign says—quote—“Webb‘s novels portray women as servile, subordinate and promiscuous, and assign his female characters base negative characteristics.”

Webb‘s response? 

JIM WEBB (D), VIRGINIA SENATORIAL CANDIDATE:  If you pull excerpts out like that, and stack them together, you‘re—you‘re—you are doing something that is not allowing the reader to discover the journey of a novel.  And those incidents either were illuminating characters or showing the average reader environments around the world.

SHUSTER:  Webb is the first candidate this year to get slammed over a fictional book, but he‘s not the first politician to write something for an adult audience. 

Lynne Cheney, wife of the vice president, wrote a novel in the 1990s featuring lesbians and lesbian sex.  Scooter Libby, Vice President Cheney‘s former chief of staff, wrote a novel 10 years ago that included passages describing pedophilia and bestiality. 

Until Libby was indicted in the CIA leak investigation, one of his top Senate defenders was George Allen.  The Allen strategy of hammering Jim Webb comes as Allen continues to face questions about his own character. 

This summer, there was the macaca moment and allegations Allen used the N-word to describe blacks.  And, throughout the campaign, Allen has refused to unseal the divorce records from his first marriage. 

But, as brutal as the Virginia Senate race has become, other races around the country are getting even nastier. 

Here is the Republican attack on a Democratic House member in Wisconsin. 

(BEGIN VIDEO CLIP, AD)

NARRATOR:  That‘s right.  Instead of pending spending money on cancer research, Ron Kind voted to spend your money to study the sex lives of Vietnamese prostitutes.  Instead of spending money to study heart disease, Ron Kind spent your money to study the masturbation habits of old men. 

(END VIDEO CLIP)

SHUSTER:  Actually, the House vote was to maintain peer review research standards at the National Institutes of Health. 

Still, the Republican effort in Wisconsin to bash Democrats includes an ad alleged that House candidate Steve Kagen is linked to a child rapist.  Why?  Because Kagen uses a civil lawyer who occasionally does criminal defense work. 

In New York, Republicans are running this. 

(BEGIN VIDEO CLIP, AD)

UNIDENTIFIED FEMALE:  Hi, sexy.  You have reached the live one-on-one fantasy line. 

NARRATOR:  The phone number to an adult fantasy hot line appeared on Michael Arcuri‘s New York City hotel room bill while he was there on official business.  And the call was charged to Oneida County taxpayers.  Arcuri has denied it, but the facts are there.  Who calls a fantasy hot line and then bills taxpayers? 

Michael Arcuri.

UNIDENTIFIED FEMALE:  Bad call. 

(END VIDEO CLIP)

SHUSTER:  But the call only cost taxpayers $1.25, and it was a misdial.  An Arcuri aide was trying to reach the Division of Criminal Justice, and got one digit wrong. 

(on camera):  If there is a theme to all of these attacks, it‘s a theme about deviant sex. 

From New York, to Wisconsin, to the Senate race in Virginia, Republicans are on the offensive, using material that makes a lot of people feel squeamish. 

The question is, will the strategy successfully take attention away from issues like the war in Iraq, or will voters see the Republican attacks as an act of desperation?

I‘m David Shuster for HARDBALL in Washington.

(END VIDEOTAPE)

MATTHEWS:  Thank you, David Shuster. 

We go now to Steve Jarding, campaign manager for Democratic Senate candidate Jim Webb of Virginia.  We were hoping to get someone from the Allen campaign, and thought we almost did, but they couldn‘t work it out. 

Let me go—Steve, you have been in a lot of campaigns.  Why do people believe junk?  Why would somebody believe that a guy, you know—and, then, they find out that it cost a buck and a quarter, because it was the wrong number.  And why don‘t they immediately get mad at the guy who put on the ad on the—and remember that somebody is lying to them?

STEVE JARDING, SENIOR ADVISER, JIM WEBB SENATE CAMPAIGN:  Right. 

Well, sometimes, they do.  And I think the risk involved, whether it‘s George Allen, at the 11th hour, throwing this kind of gutter politics out, or some of the ads that we just saw...

MATTHEWS:  Those books that he wrote, I don‘t want to defend book—I don‘t read many books like this.  But, you know, those books have been on market for years.  Anybody who wanted to talk about those books could have done it years ago.

JARDING:  Well, they could have.  And...

MATTHEWS:  And pulling it out at the last minute, it‘s obviously—well, maybe your guy has got a shot now.  I thought that—that the—it was tougher than it looks.  Maybe that‘s the only thing they got to beat him with...

JARDING:  Well...

MATTHEWS:  ... to beat Webb with.

(CROSSTALK)

JARDING:  ... only thing they have to beat him with.

And—and, when you look at it, I mean, you are right.  Not only were the books written a long time ago, they were reviewed by people like—

George Will did a jacket blurb on one of them, said it was a great book, and Cap Weinberger and John McCain.

MATTHEWS:  Why don‘t people vote on a real war in Iraq that has cost us 35-something guys‘ lives, mostly guys lives?

And a lot of people over at, you know—are in hospitals now, with their legs and arms missing.

JARDING:  Right. 

MATTHEWS:  And there‘s 50,000 or so, or 100,000 Iraqis dead.  And the world hates us. 

Why don‘t they talk about a reality event, rather than some book written years ago?  Are people that much stupid to fall for that stuff? 

JARDING:  I don‘t believe they are.  And I do think this will backfire. 

MATTHEWS:  Who cares?

JARDING:  Because I think, at the end, people are going to look and say, this looks like a very desperate act from a candidate who has spent most of the summer fumbling over himself, his own words, the macaca deal, the N-word, wrestling with his Jewish heritage, the whole stock options stuff. 

I mean, we could talk about books.  There is—there is a—a nonfiction book that his sister wrote, if we want to get into books, where she talked about George Allen as not a very nice guy...

MATTHEWS:  Yes. 

JARDING:  ... that he dragged her up the stairs by her hair and...

(CROSSTALK)

MATTHEWS:  Well, that‘s when he was a kid.

JARDING:  Yes.  Well...

MATTHEWS:  Could we have a statute of limitations, like around 8? 

JARDING:  Well, that‘s right.  But...

(CROSSTALK)

JARDING:  But, again, the point is, that‘s the kind of politics that they invite. 

MATTHEWS:  Well, you‘re in business.  You‘re in the business.

(CROSSTALK)

MATTHEWS:  I want an honest answer.  Do dirty ads work? 

JARDING:  They can.  They don‘t always work.  Sometimes, they backfire.

And I think they will backfire in this case.  They tend to backfire, Chris, when you run them late, when you—it looks like desperation.  In this case, in Virginia, the polls have gone the other way.  We now have the first poll out to show—“The L.A. Time” polls shows Jim Webb is ahead for the first time. 

MATTHEWS:  Yes. 

JARDING:  ... 47-44.

And, all of a sudden, the Allen campaign goes into a panic, and they throw this kind of stuff out there.

MATTHEWS:  Is this all they got, or is more coming next week? 

JARDING:  Well, who knows what they will do?  Desperate campaigns do desperate things.

But, by the way, it doesn‘t appear they have very much.  They have been hammering...

(CROSSTALK)

MATTHEWS:  Well, the thing is, I pointed out, not to take sides, but they have had this material since the day Jim Webb announced.

JARDING:  That‘s right. 

MATTHEWS:  And they have chosen to use it now, with the risk that it implies, because everybody in Northern Virginia, in this area of the country, reads books. 

JARDING:  Right. 

MATTHEWS:  They think.

JARDING:  Right. 

MATTHEWS:  They know how politics is played.  They are very aware of politics, being in the Washington area.  They will know that some sleazy ad man put on a sleazy ad...

JARDING:  Right. 

MATTHEWS:  ... to win a sleazy election. 

JARDING:  Well, and, on top of it, Chris, I think they will know that. 

Again, I think this will backfire.  It is too late.  It is—it just doesn‘t smell right.  It doesn‘t feel right.  As you have said, they have had it for a long time.  They‘re—George  Allen went on TV two weeks ago and said, would we stop the negative ads and talk about issues?  And then he does stuff like this.  And that‘s all he‘s been doing.

MATTHEWS:  Well, he says this election is about principles now and issues. 

JARDING:  Yes.  Well, he has said its about principles.

But one—but one of the problems that I have with—with this attack, as well, a lot of these writings are about—about incidents that happened in Jim Webb‘s life that he witnessed.  War is hell out there.  George Allen didn‘t serve.  And he keeps coming back and says, well, Jim Webb wrote about this awful stuff.

Well, you know what, Senator?  War is hell.  And, if you maybe would have read this book before you committed American troops into Iraq, maybe we wouldn‘t have 2,800 American soldiers dead, and 10,000 wounded, and God knows how many Iraqis actually killed, whether it‘s 50,000 or 100,000 or 500,000, as some of the reports say.

War is hell, Senator.  And before you start burning this book, you ought to read it. 

MATTHEWS:  Jim Webb, the Democratic candidate against George Allen in Virginia, is going to be given the honor of responding to President Bush on his weekly radio address.  That‘s tomorrow.  What is he going to say?   

JARDING:  Well, I would—I would like say we will leave it up to let...

MATTHEWS:  Do you know?

JARDING:  Let people tune it.  I saw a draft of what he‘s going to talk about.

MATTHEWS:  Well, what is he going to say?

JARDING:  Well...

(CROSSTALK)

MATTHEWS:  Give us a break here. 

(LAUGHTER)

JARDING:  It‘s—it‘s Jim Webb‘s speech.  And I will let...

(CROSSTALK)

MATTHEWS:  Well, what‘s it about? 

JARDING:  Well, it‘s—it‘s going to be about where we are at in this country and some of the policies that we are making that Jim Webb takes issue with.  And you can imagine where some of that will go.

MATTHEWS:  OK.  Since you the tell me enough there, let‘s take a look at the latest ad attacking Jim Webb for the Tailhook scandal.  Remember that baby? 

(BEGIN VIDEO CLIP, AD)

NARRATOR:  A national sex scandal.  Washington 2006?  No.  Tailhook, ‘91, 83 women assaulted.  Jim Webb, he called this scandal a witch-hunt and a feminist plot, the same Jim Webb who declared the Naval Academy a horny woman‘s dream and women psychologically unfit for combat. 

Jim Webb, right for ‘06 -- 1806. 

The National Republican Senatorial Committee is responsible for the content of this ad.

(END VIDEO CLIP)

MATTHEWS:  Fact check, please? 

JARDING:  Well, it‘s inaccurate.  I mean, Jim Webb...

(CROSSTALK)

MATTHEWS:  What‘s inaccurate in there?  Did he ever say those things? 

JARDING:  No.  He didn‘t say them in the context that they use. 

(CROSSTALK)

MATTHEWS:  What was the context? 

JARDING:  The—the context was, he was talking about where—where the Naval Academy was at and what—what Tailhook was all about. 

What they didn‘t talk about in all the writings and all—the piece that they pull from, Chris, was a piece about how we need to actually change the climate at—at the Naval Academy, how we need to bring in programs that will help stop sexual harassment and different things...

(CROSSTALK)

MATTHEWS:  Don‘t we have women pilots now, combat...

(CROSSTALK)

MATTHEWS:  ... and fighter pilots?

(CROSSTALK)

MATTHEWS:  Well, what‘s this about psychologically unfit?  I think it would take a lot of nerve to get up in a plane, going at that speed, Mach 2 or something...

JARDING:  And he supports that.  And...

MATTHEWS:  ... and then attacking an enemy plane. 

JARDING:  That‘s right.

And, at the time these things were written, 27 years ago, that was the policy of the U.S. military.  That—it was a debate this nation went through, Chris.

MATTHEWS:  Oh, I know. 

JARDING:  You—you know it was difficult.

MATTHEWS:  They still—we don‘t—still don‘t have woman, you know, in—in infantry fighting units, carrying M-16s...

JARDING:  That‘s right. 

MATTHEWS:  ... normally.

JARDING:  That‘s right. 

And it—and it...

MATTHEWS:  But...

JARDING:  It was a very difficult debate.  We went through that. 

Jim Webb, later on, became secretary of the Navy, and opened up more billets to—to—to—to women.

MATTHEWS:  Would he like to take back some of this stuff? 

JARDING:  He has said that some of the language that he used back then, that he apologized for.

MATTHEWS:  The thinking, though?  Would he like to take back the thinking? 

JARDING:  Well...

(CROSSTALK)

MATTHEWS:  I mean, everybody has changed. 

JARDING:  Well, sure.  But I think what he has said is:  Listen, the debate was important.  The nation had to have that debate.  And we did.  Did some of the language that I used, do I regret?  Yes, I do.  And I apologize for it.

MATTHEWS:  Is George Allen a racist, your opponent? 

JARDING:  No, I don‘t think he is a racist. 

MATTHEWS:  What do make of the macaca remark and all the other reporting about use of the bad words and all that stuff? 

JARDING:  Well, I like to believe—and I know this will sound crazy from somebody in my business—I—I still like to believe in the best of people.

I will tell you, though, that the record for George  Allen, the—the more that you hear, the more—it just seems to be broadening.  I mean, it started with macaca.  Then, you hear the N-word.  There was some question about some of his past and the history.  There‘s a question about the graffiti when he was in high school and got in trouble.

MATTHEWS:  I know, but high school stuff...

JARDING:  There is a pattern here that at least would cast doubt.  I -

I would like to believe and...

(CROSSTALK)

MATTHEWS:  And macaca is a racial slur?

JARDING:  It is a racial slur.  I mean...

(CROSSTALK)

MATTHEWS:  Thank you, Steve Jarding.

Coming up, we will talk about the fight in Virginia with CNBC‘s John Harwood and HotSoup.com‘s Ron Fournier.

And, later, former Nebraska Senator Bob Kerrey on the war on Iraq—he is tough on it now. 

You‘re watching HARDBALL on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Coming up:  Should a real-life election turn on a candidate‘s fiction?

When HARDBALL returns.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL. 

For more on the fierce fight in Virginia and other fights between Senator George Allen and Jim Webb, let‘s bring in John Harwood, CNBC‘s chief Washington correspondent and the political editor for “The Wall Street Journal,” and Ron Fournier.  He‘s the editor of HotSoup.com and the author of “Applebee‘s America.”

Ron Fournier, you first. 

Hillary Clinton is out front, saying she would support a move—or wouldn‘t stand away of a move in New York to allow gay marriage in New York.  The president‘s out there pushing the horn on that yesterday.

Is this going to liven up the Republican base?

(CROSSTALK)

MATTHEWS:  ... the gay marriage coming out—the Supreme Court decision coming out of New Jersey?

RON FOURNIER, CO-AUTHOR, “APPLEBEE‘S AMERICA”:  No, I don‘t know. 

I know, in 2004, that, coming out of the election, that Republicans, a lot of Republican strategists, including people in President Bush‘s inner circle, said that that—that the gay rights issue was overrated, as far as the impact it supposedly had in 2004.  I think that people who are going to be turned on or off by that issue are coming out anyhow.  I really don‘t think...

(CROSSTALK)

MATTHEWS:  John Harwood, what about bringing people to vote that normally wouldn‘t vote, the evangelicals, for example, as was the case, perhaps, in the 2004 election? 

JOHN HARWOOD, CNBC CHIEF WASHINGTON CORRESPONDENT:  Boy, I think it‘s awful hard to cut through the static on Iraq, on the Foley scandal, anxieties about the economy at this point with the gay marriage issue, especially when you have got people like David Kuo out with his book, saying that the president and his team are sort of exploiting religious conservatives. 

I—I think that‘s a big challenge to try to make that a cutting issue at this point in the campaign. 

MATTHEWS:  Do you think it will make it an issue in Florida now? 

HARWOOD:  Well, sure.  And they will try to make it an issue wherever they can.

MATTHEWS:  The gubernatorial—gubernatorial races, yes.

HARWOOD:  There are ballot initiatives up in several states, including Tennessee and Virginia.  But I‘m skeptical that that is going to drive a lot of voters in this particular election season. 

MATTHEWS:  John, you first this time.

What do you make of the Allen campaign, after weeks of campaigning against Jim Webb, the former secretary of the Navy, the former combat veteran, going back to his writings in fiction, and saying they show he is a bad person?  Is that desperate?  Or what the hell is that stuff?

HARWOOD:  Honestly—honestly, Chris, I think that‘s a little over the top. 

It‘s as if the Webb people went after Allen as somebody who is violent because he used to knock people around on a football field. 

MATTHEWS:  Yes. 

HARWOOD:  I mean, novelists include sex scenes.  That‘s sort of the way it goes. 

And Webb was a serious novelist, who got good reviews for “Fields of Fire” and some of his other work.  So, you know, I just think as—for the campaign—as one of our colleagues wrote in the paper today, this is kitchen-sink time in the campaign, where people are throwing up anything they can. 

MATTHEWS:  Yes. 

HARWOOD:  And this is an example of that.

MATTHEWS:  Yes.  Somebody called me up a few minutes ago and said, well, just because Tolstoy wrote about the burning of the Moscow doesn‘t mean he believed in the burning of Moscow. 

(LAUGHTER)

HARWOOD:  Exactly. 

FOURNIER:  Exactly. 

It is—it just—it is getting out of hand, but it happens this—you know, like this at every time in the election.  I know I‘m...

(CROSSTALK)

MATTHEWS:  Kitchen-sink time. 

FOURNIER:  Yes.  And there has been elections where it has been far worse, to be honest.

I know I‘m living in this online community right now at HotSoup.com.  And people are just—they‘re tired of the negative campaigning.  But they draw a distinction.  If it‘s a negative ad that points to somebody‘s record, that points to a real issue, they want to know about it.  And that‘s fair.

MATTHEWS:  Well, what about these obscure omnibus votes on something like NIH appropriations, where they say, somewhere in that bill was something that studied the masturbation habits of seniors, and how—first of all, I wish that the Congress would read these bills.  But...

FOURNIER:  Well, that‘s the point I was making.

Now, that obscure stuff, or the personal, you know, half-baked stuff, people just don‘t buy it.  People are more intelligent than we give them credit for.

(CROSSTALK)

MATTHEWS:  You mean, they know that that is just an oddity in a bill?

FOURNIER:  Yes.  Yes, they do.  They know that it‘s—that a lot of stuff they are seeing is—is B.S. 

(CROSSTALK)

MATTHEWS:  Do you think that‘s true, John?  You don‘t think people...

HARWOOD:  And, Chris, by the way, this is also true of that stock options issue that you see from the Webb campaign. 

MATTHEWS:  Yes. 

FOURNIER:  We are talking about options that were reported at an earlier point, left off later reports, because the options were underwater.  And, so, this is, you know, anything they can grab ahold on.

MATTHEWS:  Hey, look, I know all about underwater—I know all about underwater options, John...

HARWOOD:  You betcha. 

MATTHEWS:  ... that have absolutely no meaning whatever to you financially.  They just—they are something to keep in your drawer and hope for. 

But you mean—you mean the fact that—that Allen was—was

accurate in reporting them initially.  And, then, when they became to have

obviously have no value financially, he stopped reporting them—or failed to?

HARWOOD:  Well, if you were—if you were writing down the list of assets you had, and you had a bunch of options that were $20 a share underwater, it probably wouldn‘t occur to you that those were big assets in your portfolio. 

MATTHEWS:  Well, all they do is bother you.

Thank you, John Harwood.  Well, you‘re going to stay with us. 

John Harwood, Ron Fournier, stay with us. 

Up next, John Harwood‘s report on the Senate fight out in Montana. 

And, later, NBC‘s Tom Brokaw reports on the California governor‘s race. 

You‘re watching HARDBALL on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.

Democrats need six seats to take over the U.S. Senate.  One place where they think they might get it is in Montana.

CNBC chief political correspondent John Harwood reports.

(BEGIN VIDEOTAPE)

HARWOOD (voice-over):  At the annual livestock exhibition in Billings, plain talk goes a long way.  But Senator Conrad Burns may have taken it too far, tripping over his tongue with remarks that offended groups like Muslims, and more importantly out West, firefighters.

SEN. CONRAD BURNS ®, MONTANA:  Think before you speak probably is the worst—the worst habit I have got.

HARWOOD:  Burns has struggled with doubts about the Iraq war.

BURNS:  We‘re not seeing any progress in the—in the news.  On the ground, we are making a lot more progress.

HARWOOD:  And he faces fierce attacks from Democratic opponent Jon Tester over ties to a corrupt lobbyist, who bragged of winning favors after clients gave Burns campaign cash.

(BEGIN VIDEO CLIP, AD)

NARRATOR:  Conrad Burns, delivering for Jack Abramoff, not us. 

(END VIDEO CLIP)

HARWOOD:  The result, one recent poll shows Burns trailing by four percentage points, as voters in this Republican red state, like across the country, look for change. 

UNIDENTIFIED MALE:  Whether we disagree with them on their politics or whatnot, we—we want someone that we feel is being honest.  And Conrad has lost that for me. 

HARWOOD (on camera):  President Bush carried Montana easily in both his national campaigns.  But, as more newcomers move into big sky country, Democrats have shown an increasing ability to compete. 

(voice-over):  Especially rough-hewn Democrats like Jon Tester.

JON TESTER (D), MONTANA SENATORIAL CANDIDATE:  (INAUDIBLE) farm is becoming a hot-ticket item.

HARWOOD:  A farmer and state senator who shows off his flattop, his cowboy boots, and the hand mangled by a meet grinder when he was a boy. 

(BEGIN VIDEO CLIP, AD)

UNIDENTIFIED MALE:  It only takes about two minutes around Jon Tester to know that he‘s on our side.

(END VIDEO CLIP)

HARWOOD:  Tester also shows off his alliance with popular Governor Brian Schweitzer, who sparked a Democratic revival here by winning the statehouse two years ago.

TESTER:  My first priority is not going to be what any other Democrat wants or any other Republican wants.  It‘s going to be what the people of the state of Montana need. 

HARWOOD:  But, Burns, a former auctioneer and farm broadcaster, is still trying to close the deal on a fourth term, warning voters that Tester would raise taxes...

(BEGIN VIDEO CLIP, AD)

NARRATOR:  Tax-hike Tester is too liberal for Montana.

(END VIDEO CLIP)

HARWOOD:  ... and says he would deprive the state of the clout Burns brings as chairman of a powerful spending subcommittee. 

BURNS:  Effectiveness is important, and experience is important. 

UNIDENTIFIED FEMALE:  To start all over again, and not have that seniority, would be a major blow to Montana. 

HARWOOD (on camera):  In a state this consecutive, Democrats have seen big leads in the polls shrink on Election Day.  So, the great Montana voter roundup of 2006 isn‘t quite over yet. 

(END VIDEOTAPE)

MATTHEWS:  Well, that‘s an interesting report, Ron Fournier.

What do you make of that one?  Do you think that that—I thought Conrad Burns was finished until a couple days ago.  And his polls are getting closer.

FOURNIER:  Yes. 

MATTHEWS:  He looks like he might pull it out. 

FOURNIER:  He‘s got a chance.  That‘s a—that‘s an awfully tough race.  

But, I mean, that‘s a good example of a—of a race where people are

just, you know, looking for a change.  And they are taking a hard look at -

at this new guy. 

MATTHEWS:  Right.  That‘s right. 

Up next, NBC‘s Tom Brokaw reports on the hot governor‘s race in California.  We will talk more with CNBC‘s John Harwood, HotSoup.com‘s Ron Fournier. 

And, later, former Senator Bob Kerrey is going to join us.

You‘re watching HARDBALL on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.

A year ago, voters in California were ready to abandon their governor, Arnold Schwarzenegger.  But now that he has moved from the right to the political center, the story has changed. 

NBC News‘ Tom Brokaw interviewed Governor Schwarzenegger, and has the report. 

(BEGIN VIDEOTAPE)

TOM BROKAW, NBC NEWS (voice-over):  Six months ago, the governor was in so much political trouble, many thought not even “The Terminator” could rescue him.  But he moved from the right to the left on the environment, minimum wages, prescription drug prices for the elderly and suddenly his numbers are way up again.  But is he still a true Republican? 

(on camera):  The Democratic speaker of the California Assembly says that you have been a reliable partner in advancing the Democratic agenda, which leads a lot of people to believe that if you get elected governor again, that the state will not be going Republican, it will have a more Democratic governor than Republican governor.

GOV. ARNOLD SCHWARZENEGGER ®, CALIFORNIA:  Well, I think that it is a big mistake to put everything in the perspective of is it a Democratic or a Republican idea.  The bottom line is really to ask yourself is it an issue that is good for the people, rather than is it a Democratic issue or a Republican issue. 

BROKAW:  And does Uncle Teddy call and say, Arnold, you are one of us after all, you are moving that state to the center and you‘re involved in the Democratic agenda in a way I never thought you would be? 

SCHWARZENEGGER:  Well, I‘m very happy that he likes what I‘m doing and I enjoy always getting good lessons from Teddy.  We never talk about, you know, Democratic verses Republicans, because I think he recognizes I‘m a Republican and I go much more in that direction. 

BROKAW:  Are you much more like another famous California governor, Jerry Brown, than you are like Ronald Reagan? 

SCHWARZENEGGER:  I‘m—you can‘t compare me with anybody, really, because, I mean, everyone is unique and different.  But I think that Ronald Reagan was a man that was, you know, thinking always what‘s best for the people and he brought both of the parties together.  He was known for that. 

That is sometimes, you know, difficult for people to do when it is election year.  In election year, everyone is trying to derail everyone.  The Democrats try to derail the Republicans, the Republicans try to derail Democrats. 

But I think that we have gotten together and is what I think makes this state somewhat unique, that both parties got together and said let us accomplishment a lot this year. 

BROKAW (voice-over):  But the governor‘s Democratic opponent, Phil Angelides, warns that Schwarzenegger‘s move to the center won‘t last, and he ties Schwarzenegger to the Bush administration. 

PHIL ANGELIDES, DEMOCRATIC GUBERNATORIAL CANDIDATE:  What‘s he is doing is trying to act like a Democrat for the 90 days before the election but, in fact, when he has governor over the last two-and-a-half years, their policies have been the same. 

SCHWARZENEGGER:  I apologized to her ...

BROKAW (on camera):  You have also done something unusual.  You have apologized publicly for a number of statements that you‘ve made, calling the state legislators girlie men, making references to Latins having hot blood, and some of the comments that you had to say about immigrants.  You went public and apologized for them. 

SCHWARZENEGGER:  I come from a business of body building and from a sport where you speak much more kind of casual, and just whatever comes to your mind.  Now, all of sudden, you step into politics, you can‘t do that because one little mistake and you can offend a lot of people. 

And that is not my intention.  You know me well enough.  I mean, I‘m not out trying to attack people or say something prejudice or whatever.  But sometimes things slip out, and I think that the key is, is when you say something crazy that has offended some people, say it.  Say I‘m sorry.  I believe in that. 

BROKAW:  And when you get home at night, does Maria say, Arnold, you have got to go out there tomorrow and say you‘re sorry? 

SCHWARZENEGGER:  I don‘t think Maria ever says that, but, I mean, I tell you, when I go home, I have to say many times I‘m sorry at home to Maria. 

(END VIDEOTAPE)

MATTHEWS:  That was NBC News‘ Tom Brokaw.

As the campaigns get nastier and the ads get negative, which Senate candidates have run the best and worst campaigns? The “National Journal” asked that question of political insiders. 

And both the Republicans and Democrats agreed that Democratic Congressman Harold Ford of Tennessee ran the best campaigns, with Republicans also giving equal measure to Republican Michael Steele who is running for senator up in Maryland. 

And for who ran the worst Senate campaigns, Republicans and Democrats overwhelming agree it‘s George Allen—macaca—of Virginia.  Back again to the twists and turns of the hot races around the country.  Ron Fournier, editor and chief of the hotsoup.com, and CNBC‘s Chief political correspondent John Harwood, who‘s also with the “Wall Street Journal.”

John and Ron, I want to run through these.  As I looked at these races a couple of weeks—and everybody else, I‘m not unique—there were four chances the Democrats had to pick up seats fairly easily for the U.S.  Senate, but they need six: North Dakota, Ohio, Pennsylvania and Rhode Island. 

Ron, do they still all look good for the Democrats? 

RON FOURNIER, HOTSOUP.COM:  yes, I don‘t think anything looks sure for the Democrats right now, but ... 

MATTHEWS:  Looks better than not? 

FOURNIER:  Definitely Better than not, those four. 

MATTHEWS:  Do you agree, John Harwood, they still look like better bets for them than for the Republicans in those four states? 

JOHN HARWOOD, CNBC CHIEF POLITICAL CORRESPONDENT:  Sure, and you meant to say Montana rather than North Dakota, but if ...

MATTHEWS:  Right.  I‘m sorry, Montana.

HARWOOD:  ...you take Montana, Ohio, Pennsylvania and Rhode Island, both of those are all better than 50-50 for the Democrats, and so a baseline for Democrats is the prospect of picking up four seats. 

MATTHEWS:  So let‘s talk about what they need to pick up six.  They have three prospects: Missouri, Tennessee and Virginia.  What is their best prospect—you, John—to pick up another seat to make it five? 

HARWOOD:  Missouri is their best prospect.  That‘s what Republican and Democratic strategists both tell me.  Not going to be easy.  That is a tough, tough state for Democrats to win.  But Claire McCaskill is somebody who has a chance of holding down Talent‘s margins in the rural areas and doing well the big cities.  But that‘s the top prospect.

Probably next after that is Tennessee, then Virginia and that outside shot in Arizona where one poll recently showed Jim Pederson pulling a little bit closer to Jon Kyl. 

(CROSSTALK)

MATTHEWS:  I have been predicting that—well, I can‘t predict but I have been watching that for an upset for weeks now, that Kyl gets bounced. 

Let me go now right with—would you agree with that order?  John surprising me there.  He said after winning Missouri, Ohio, Pennsylvania, Rhode Island, that the Democrats‘ next best chance is Missouri, do you agree with that? 

FOURNIER:  I do, and I think the wildcard here, the thing to watch is the Republicans‘ ability which has been better the last two cycles to target, find and persuade their voters.  Their get out of vote operation has been phenomenal the last two cycles. 

MATTHEWS:  In Missouri? 

FOURNIER:  I think in all three of those states. 

MATTHEWS:  All right.  Let‘s talk about—do you think the next bet is Tennessee or Virginia? 

FOURNIER:  And actually, Missouri is the state where they have the GOTV of those three. 

MATTHEWS:  Get out the vote. 

FOURNIER:  Get out the vote.

MATTHEWS:  You‘ve got to explain these things to—get out the vote, GOTV.  You know, it took me awhile to learn that one. 

FOURNIER:  Missouri‘s a state that they targeted in 2004, so they have all the folks out there that ...

MATTHEWS:  So you all agree that the top four: Missouri—I‘m sorry -

Montana, Ohio, Pennsylvania, Rhode Island and then Missouri is the next best bet.  Of the other two, Tennessee or Virginia, Tennessee where Harold Ford Junior is running against John (sic) Corker, and Virginia, where—we‘re been talking about that a lot tonight.  That‘s where incumbent Senator George Allen is being faced by a strong challenge by Jim Webb.  What is the best bet for the pickup of the final six—final six, please? 

FOURNIER:  I agree Tennessee, and what nailed it for me was when I saw that highly negative, outrageous that the Republicans ran in Tennessee ...

MATTHEWS:  The sexpot ad. 

FOURNIER:  They must obviously be desperate to run an ad like that.

MATTHEWS:  So that‘s fascinating, because when you see a really—well, I‘ll call it sleazy ad like that, where they are clearly playing on racial prejudices and everything else, you think that‘s a sign that they‘ve got to dig deep because they‘re going to lose? 

FOURNIER:  It‘s a sign that they have to dig deep because they‘re afraid they‘re going to lose, definitely.

MATTHEWS:  John Harwood, do you see that as a sign of desperation, that ad we‘ve been showing a lot of?

HARWOOD:  Absolutely.  They wouldn‘t run the ad unless they felt like

they really, really needed something very, very provocative and close to

the edge.  It could have the effect—I talked to a Ford strategist today

of ginning up their base. 

On the other hand, it‘s getting tremendous discussion, not all of it flattering to the Republican side.  And there could be a backlash, particularly among independent swing women in that state. 

MATTHEWS:  So when you see an ad that is clearly aimed at scaring—let‘s be blunt about it—white men about a black candidate—an African-American candidate, being chased after—basically in the ad that‘s how that‘s portrayed—by a beautiful white woman, the women will read that and say, these guys are sleazeballs—John. 

HARWOOD: I mean, it really does strike you as an ad when you look at it that borders on the ridiculous.  It‘s kind of clever.  There‘s some funny aspects to it.  But is it a series discussion of what Harold Ford is all about?  I don‘t think so.  It‘s the kind of thing think that has some shock value but I‘m not sure there‘s a lot of persuasion going on there.  Like I said, there is base motivation that may be the biggest relevance on the Republicans. 

FOURNIER:  We have a lot of Republicans—a lot of Republican opinion leaders on hotsoup.com saying this ad turns me off.  I may not vote Republican because of this ad.

MATTHEWS:  Whoa, let me go to Chris Cillizza of WashingtonPost.com.

John—Chris, do you have any reading on that?  We had Harold Schaitberger in here, from the firefighters, and I know he is a partisan, but he said among his rank and file—they‘re regular people, they‘re firefighters over there, and most of them white guys in Tennessee—say they are really turned off by that ad? 

CHRIS CILLIZZA, WASHINGTONPOST.COM:  You know, I think you can talk to strategists on either side and get a different opinion.  Look, the people that I talked to, Republicans that I talked to, say we were down eight or nine points before the ad.  We are now tied or ahead.  Draw your own conclusions there, but they believe that it was effective. 

Whether it was effective because it was race baiting, whether it was effective because it showed Ford as out of mainstream, that‘s up for debate, but they believe fundamentally—and whether it was an act of desperation or not, they fundamentally believe it worked.  They‘re not debating the moral rightness here.

HARWOOD:  Chris, I have a hard time believing that that ad by itself swing that race by 12 percentage points.  I‘d be surprised if that were true.

CILLIZZA:  Oh, no.  I agree.  I don‘t think it‘s that ad in a vacuum.  I mean, the reality is that so many things are going on towards the end of a campaign that it‘s impossible to isolate, but ... 

MATTHEWS:  Well, could one of those things be—John, did Harold Ford hurt himself when he showed up at the other guy‘s—at John (sic) Corker‘s press event? 

HARWOOD:  Yes, I think he did.  And I think, again, that‘s the flipside.  We talked about desperation.  And it also goes to the point of how much this ad had something to do with Corker being ahead.  Corker was making some progress the last couple of weeks before this ad ever showed up, and you saw that reflected in Harold Ford trying to crash his press conference. 

Candidates don‘t look great when all of a sudden they are trying to sort of edge into the other guy‘s spotlight.  We saw that from the Deb Price, the House candidate in Ohio who got on a flatbed truck outside the headquarters of her opponent and said let‘s have a debate.

MATTHEWS:  And most of us ...

(CROSSTALK)

MATTHEWS:  ...will never forget watching vice president—what‘s his name—what is his name?  Vice president—the one before Cheney ...

CILLIZZA:  Gore.

MATTHEWS:  ...Gore walk into the space of George W. Bush during that debate and Bush gave him that look like what‘s the problem with you guys?

CILLIZZA:  Or Chris, what about Rick Lazio going over to ...

MATTHEWS:  With Hillary Clinton.  I thought of that.  Got it.

CILLIZZA:  ...Hillary Clinton‘s space and that was—you know, that was largely seen as sort of the straw that broke the camel‘s back for Rick Lazio.  He thought he was being proactive and challenging Senator Clinton, and clearly, women and other folks in New York did though the like that sort of confrontational tactic.

MATTHEWS:  Poor Al Gore has slipped off my list of names of politicians.  I‘ve got to get—come on back, Al. 

UNIDENTIFIED MALE:  Boy, how far they fall.

MATTHEWS:  Come on back.

More with John Harwood, Ron Fournier and Chris Cillizza after the break.

And also Sunday on CN—on MSNBC‘s “Meet the Press”, Tim Russert‘s going to moderate the debate between—these are hot candidates.  This is a hot race.  Ben Cardin of Baltimore, Democrat, running against Republican Michael Steele.  He‘s the lieutenant governor, going for the U.S. Senate. 

You‘re watching HARDBALL, only on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Coming up, the campaign ads are staying dirty.  Will they change any minds?  When HARDBALL returns.

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL.  We‘re talking mid-terms in the hot races across the country. 

Ron Fournier is editor-in-chief of the HotSoup.com.  That‘s where people talk online with each other.  And the “Wall Street Journal‘s” John Harwood is CNBC‘s chief political correspondent.  And Chris Cillizza is with the WashingtonPost.com.

Chris, I want you to catch up with these older fellows here and tell me...

UNIDENTIFIED MALE:  Hey...

MATTHEWS:  Yes, tell me if you agree that it‘s Montana, Ohio, Pennsylvania, Rhode Island as the best prospects for a Democrat pick-up in the United States Senate, followed by Missouri, Tennessee and Virginia?  Is that your sense of the races right now?

CILLIZZA:  Well, even if it wasn‘t, I would never disagree with Misters Harwood and Fournier on the air.  That could be career-understanding. 

Look, I think the most important race to watch is Missouri, because I think as Missouri goes, the country will go.  What I mean is that, in Missouri, you‘ve seen Senator Jim Talent run a very good race: well financed, good ads.  He hasn‘t made any offensive mistakes...

MATTHEWS:  He has nothing wrong, no firing offenses. 

CILLIZZA:  Exactly.  And you‘ve seen the Democrat, Claire McCaskill, doing essentially the same, run a nicely—nice looking, well-financed, good campaign.  Now, Missouri typically tilts slightly to Republicans.  The question is, is the national environment strong enough that it‘s going to tilt it towards Democrats? 

I believe that if Claire McCaskill wins, you have a real likelihood of both Harold Ford Jr. and Jim Webb or one or the other winning.  I think if Jim Talent wins that race, I think it‘s very unlikely that Tennessee and Virginia go, because it‘s a sign of how strong that wind is blowing.  And we‘re going to know based out of Missouri. 

MATTHEWS:  Do you agree, Ron Fournier?

FOURNIER:  It‘s a very good way to look at it, Missouri being the pivot point. 

MATTHEWS:  And it always has been.  The Show-Me State, and it also was the only state in the union, guys—anybody know what it did uniquely in history?  It‘s always picked the winner, except in 1956.  It split from voting for Ike back to Stevenson who had ran the last time.  They had rejected Stevenson in ‘52.  They went back to him in ‘56.  I think Harry Truman had something to do with it, but I‘m not quite sure.

Do you agree with that, John, that Missouri is the Show Us State now?

HARWOOD:  Well, I think there‘s something to what Chris is saying, but I don‘t think it‘s impossible that Claire McCaskill could win a close race in Missouri and still Democrats find that Tennessee and Virginia go south on them, which if that happens, they of course, would be dependent, as you and I were talking a few minutes ago, on Arizona.  Something like that coming through...

MATTHEWS:  A fluke, yes.

HARWOOD:  ... and getting at least a 50 if not more. 

MATTHEWS:  Is Mr. Peterson, the Democratic candidate in Arizona, putting in big money?  Is that why that is beginning to tilt back to even?

HARWOOD:  Well, he needs to put in big money, because the Democratic Senatorial Committee is no longer playing in that a race.  They got to the sort of triage point at the end of campaign and decided they had better opportunities elsewhere. 

Peterson has a lot of money.  He has self-funded most of his campaign.  The question is can he put in enough at the end to really make a big difference?  He‘s been behind.  Kyl‘s had a working lead for a while.

But again, part of it goes to Chris‘ point about races being reflective of what‘s going on nationally.  If the bottom drops out on Republican turnout, if that turnout machinery doesn‘t matter all that much, because the center of the electorate, independents, have collapsed on the Republicans, then you could see something happen there and other places, as well. 

MATTHEWS:  Could it be that Kyl is just too much of a hawk, Chris?  Is that what‘s going on?  Anybody have an idea about why a guy from Arizona would be in trouble?  Or is he in trouble? 

CILLIZZA:  I think Arizona is one of these states so—the population changes so much every six years.  Remember, Phoenix is this vast and growing city.  And so because the population turns over so much, the fact that Jon Kyl has been in the Senate doesn‘t mean as much in a state that grows that quickly.  So a lot of these people are new to Jon Kyl, and Jon Kyl is new to them, which gives Peterson a chance. 

Again, he‘s really going to have to spend, spend, spend.  And he‘s going to need, as Jon pointed out—he‘s really going to need a very strong wind at his back, I think here.  Kyl, as we talked about in Missouri, Kyl hasn‘t committed any fireable offense here.  He‘s not as prolific or as telegenic as John McCain, certainly, but that‘s—that‘s not something that incumbents usually get fired.  If they did, most of the incumbents in Congress would be gone.  So...

HARWOOD:  Let‘s talk about the issue of immigration, something that was talked about all year long as a major priority for Congress.  Not much happened. 

I was there a couple of weeks ago and talking to some of those hawks on border security and said, “Well, what about the fence that they‘re building.” 

And the reaction was, “They‘re not going to build that fence.”  And there‘s been some commentary lately about how Congress authorized the thing, didn‘t put up all the money for it.

MATTHEWS:  Right.

HARWOOD:  So you could have some skepticism and look at Congress as not getting much done.

MATTHEWS:  And they—John, didn‘t they leave the option of the president to spend the money in different ways?

HARWOOD:  Exactly. 

CILLIZZA:  And in fact, in Arizona...

MATTHEWS:  Let me ask you all about reality and the grim reality we live in, in this country.  We haven‘t talked about it.  We‘re having a little fun here.  But in reality, we‘re at war, and we‘re at war—we‘re at a war, involved in one that doesn‘t seem to be helping us defeat terrorism or actually get somewhere, with costing us casualties, American casualties every day. 

Is it possible that one reason why this election seems to be swinging slowly to the Democratic side, to the opposition side, gentlemen, is because people see casualties on the front page now, and it doesn‘t seem to be stopping?  Ron Fournier?

FOURNIER:  Definitely.  I think we haven‘t talked about yet today but Iraq and the war on terrorism, especially Iraq, is the biggest issue out there right now.  It‘s really cutting people close.  They realize that it‘s not going well.  They believe that they have—a lot of people believe that the administration hasn‘t been straight with them. 

They don‘t know what to do about it.  People don‘t want to—most people don‘t want to pull out.  Most people don‘t want to stay the course.  Especially on this web site, you see a lot of people looking for different alternatives.  They‘re looking for a better way to talk about it, a way that it actually might lead to solutions.  They‘re not seeing that in Washington right now. 

MATTHEWS:  John Harwood.

HARWOOD:  The hope for Republicans is that just before voting time, there‘s going to be a gut check by some decisive group of swing voters who say, you know what?  A Bush advisor told me this the other day.  I was kind of surprised by the candor.  He said, “You know, maybe they haven‘t been all that confident in how they‘ve run the war, but they‘re on offense.  They‘re trying.  Democrats would be weaker.”

MATTHEWS:  John—John Harwood, Ron Fournier, and Chris Cillizza, thank you. 

Coming up, Senator Bob Kerrey will be right with us.  What a veteran he is.  You‘re watching HARDBALL on MSNBC. 

(COMMERCIAL BREAK)

MATTHEWS:  Welcome back to HARDBALL. 

For the latest today in Iraq, here‘s NBC‘s Jane Arraf in Baghdad. 

(BEGIN VIDEOTAPE)

JANE ARRAF, NBC NEWS CORRESPONDENT:  A relatively quiet day in Baghdad.  The city has been under curfew for most of the day.  This curfew was imposed with rising sectarian violence, and it was an effort to cut down on the number of car bombs and suicide car bombs around mid-day prayers. 

But in other parts of Baghdad, U.S. forces were out in full force in the neighborhood of Sadr City.  It‘s a huge Shia neighbor, home to loyalists to Muqtada al-Sadr.  U.S. forces say they‘ve been searching door-to-door and have imposed roadblocks there, in an attempt to find a missing American soldier who was kidnapped on Monday. 

Iraq‘s national security advisor says he believes that U.S. should not be too heavy-handed.  He says Iraqi officials have made it a priority to find the soldier and they are negotiating, talking to leaders of several groups in an effort to negotiate his release. 

A security advisor also says there could be drastic revisions in the Baghdad security plan.  Among them, he says, perhaps we need to reduce the visibility of American soldiers here in the capital. 

Jane Arraf, NBC News, Baghdad. 

(END VIDEOTAPE)

MATTHEWS:  Thank you, Jane Arraf. 

October has been the deadliest month this year for American forces in Iraq, and this week the president announced a plan for Iraqis to have benchmarks for progress.  Will this get our troops home any more quickly?

I‘m joined by former Nebraska senator, Bob Kerrey. 

Lots of new ideas about how to shorten this war.  One is—just came out from John McCain, your former colleague, says we needed 120 -- we need another 125,000 troops over there.  What do you make of that?  Will this help us?

BOB KERREY (D), FORMER NEBRASKA SENATOR:  I don‘t think it will help us.  I mean, maybe you get down to 500,000.  The problem is contained in two pieces of polling data in Iraq.  Seventy percent of the Iraqis want us to leave.  And 60 percent say it‘s OK to kill Americans.  You can‘t remain in an environment like that.

We‘re trying to save the Iraqi government, and in order to do that, we‘re operating, killing other Iraqis who were fighting with each other.  It just—you can‘t sustain that. 

At some point, you‘ve got to design a strategy to get out of there to allow the Iraqi people to do it on their own.  Because we‘re—I do think that we are creating a force that makes it hard for the Iraqi people to resolve their political conflicts. 

I‘m not talking about expeditious, put them all on planes and get them out of there.  But you‘ve got to get in your head that you cannot finish this job with a military effort.  It is a—it‘s going to require the Iraqi people to resolve their political conflicts, and it‘s not, I think, likely to occur as a sequence of U.S. forces being there. 

Because it looks like every time they do something, they‘re going to get attacked and accused by other people for doing it because the Americans told them to do it. 

MATTHEWS:  But didn‘t you see that going in?  In the beginning, you were supportive of the initial decision to go in, but didn‘t you see going in, knowing history, that eventually a third world people will resist and oppose and begin to kill any invader?

KERREY:  No, I didn‘t see it as clearly as I should have seen it going in.  I mean, in part because what I was hoping was a military effort that we had in place to contain with no-fly zone missions in the north and the south, in part because I, you know...

MATTHEWS:  Yes, they were working?

KERREY:  Well, they were and they weren‘t working.  I mean, they were not working in terms of their influencing Saddam Hussein‘s behavior to do what was necessary to get the sanctions off.  So it wasn‘t working from that standpoint.  I mean, I didn‘t think that they—it was going to come to an end. 

MATTHEWS:  You were in Nam, Vietnam.  You were a real fighter over there.  You were a SEAL.

KERREY:  Yes. 

MATTHEWS:  Did you ever get a sense of what point, if there was a point, that the people of Vietnam began to turn against the American commission there?

KERREY:  Well, no.  I didn‘t, actually.  I was—it was much later as I began to examine the history of it and talk to other people. 

There was a lot of South Vietnamese support for living independent of North Vietnam.  It was a different kind of a conflict than what we see in Iraq.  But it was the same in one big way, which is you‘re fighting inside of somebody else‘s country, and in order to win, you have to kill some of those people to be successful.  And it‘s always going to produce a bad feeling when you do. 

In some ways, though, it‘s worse, because I don‘t think there was as much deception about what was going on in Vietnam as there is in this Iraq war, and this much cronyism and corruption and incompetence.  I mean, my God. 

MATTHEWS:  You think we were talked into this war by people who wanted the war in the worst way, and they weren‘t honest with us?

KERREY:  Maybe, I mean, it‘s possible.  I mean, certainly, there was a lot more enthusiasm after 9/11 for going overseas and trying to reduce the threat.  So it‘s possible that that‘s the case. 

I think—certainly, there‘s strong evidence that the numbers were rigged about weapons of mass destruction and the presence of weapons of mass destruction, et cetera.  So it‘s possible that that‘s the case. 

Regardless, right now you‘re dealing with a situation where, the one way of saying it is this: you don‘t have to occupy a country in order to fight terrorists inside of that country. 

Remember, Zarqawi was brought down by external forces going in.  We had 22 successful efforts going overseas to bring people back to the United States.  We don‘t need Gitmo for Khalid Shaikh Mohammad.  We tried his nephew in New York City, and he‘s got 204 years in solitary confinement facing him. 

So the idea that I‘ve got to occupy a country is wrong in order to fight terrorism.  And indeed it can create more problems than it solves.  I think—and I think the only way to get out of this thing, in my view, is for all of to us try to face that essential fact. 

MATTHEWS:  Was Iraq a blunder?

KERREY:  Oh, I think—I mean, I‘ll tell you in 10 years.  I mean, I can‘t tell you now.  If the nation state of Iraq survives, if they manage to survive as a unified state in some form of democracy, then I‘ll say it‘s a success.  But right now the middle class is fleeing.  They‘re running away.  It‘s not a good place to send your kids to school there. 

MATTHEWS:  Senator Bob Kerrey, Vietnam veteran, former senator from the state of Nebraska. 

Thank you, Senator Kerrey.  Watch MSNBC all next week for nonstop Decision 2006 coverage all the way through until election day.  And watch HARDBALL at 7 p.m. Eastern on Monday night, when I‘ll moderate Florida‘s governor‘s debate. 

Right now it‘s time for Tucker. 

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

END   

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